ANNEX I

STATEMENT BY EUROPEAN UNION FINANCE MINISTERS

We reviewed prospects for the European economies.We reaffirmed our view that there is increasing evidence of broadly based economic growth and that this will provide the basis for new employment opportunities and greater prosperity.We are determined to provide the conditions for sustained growth by implementing the sound policies set out in the Broad Economic Guidelines.We went on to review recent international economic developments.

We welcome and support the Russian Government's economic reforms, in particular the reforms to strengthen the tax administration and improve tax collection.We are ready to consider further conditional support for Russia as necessary and appropriate.Any such assistance should be provided by the IMF and World Bank, which are the right and proper instruments for that purpose.We intend to support Russia's new 1998 program at the IMF Board.

We discussed the latest situation in Asia.We noted the data published in Japan on Friday which showed GDP falling by 1.3% in the first quarter of this year.The economic impact of the recently announced fiscal stimulus has still to come through.Further structural reform and the implementation of measures to strengthen the financial system are necessary to restore business and consumer confidence.

We also discussed the latest developments in Indonesia.We welcomed the statements committing the Indonesian government to economic and political reform and stressed the importance of both transparency and its continuing good cooperation with the international financial institutions.We recognized the economic hardship faced by the people of Indonesia and welcomed the humanitarian assistance being provided by the European Community and the Member States individually.

We, as European Union Finance Ministers, will continue to monitor developments closely.

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