Trade damage feared

HONG Kong Financial Secretary Donald Tsang Yam-kuen has warned Japanese Finance Minister Masayoshi Takemura that Japan's slumping economy and banking problems could hurt trade links. He fears Japanese banks may be forced to reduce their operations in Hong Kong while dealing with bad loans at home.

But Mr Takemura assured Mr Tsang yesterday that the bad debt problem weighing on Japanese banks would be overcome in a few years, an official said. Mr Tsang said sustained economic growth in Japan played a key role in the economic advancement of China and Hong Kong because of mutual trade links.