Japan tells G7 it is focusing on China

Japanese Finance Minister Naoto Kan told his Group of Seven counterparts that Tokyo was focusing on China's economy as it was showing signs of a bubble.

He also said the G7 finance ministers and central bank governors spent much time discussing Greece's financial problems at a working dinner on Friday which kicked off a two-day G7 gathering in the Arctic town of Iqaluit, Canada.

"I said Japan's focus was on China's economy as there were some signs of a bubble," Kan told reporters after the dinner, adding that there were no objections when he explained Tokyo's view that stable Chinese growth was necessary.

He did not say whether there was any specific talk on the Chinese yuan. Beijing has continued to shrug off pressure from its major trading partners to let the yuan appreciate, repeating its line that stability is in everybody's best interests.

The G7 leaders also discussed Greece's financial woes, with much time spent on how much role the IMF and the European Union should each play in seeking a solution to the problem, Kan said.

He also said France circulated its own proposal on G7 reform as a basis for debate, but that no conclusion was reached at the working dinner.

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