TOKYO, Reuters – Asian countries must consider spillover risk as a decade’s worth of unorthodox easing policy by central banks is withdrawn more quickly than anticipated, International Monetary Fund (IMF) Deputy Managing Direct Kenji Okamura stated.

Okamura said that this risk was especially relevant to the most fragile economies without naming them.

He said that Asian countries faced the dilemma of supporting growth through more stimulus or withdrawing it in order to stabilize debt and inflation.

The Bank of Japan has been attempting to counter a worldwide shift toward monetary tightening. However, the central banks of Australia, Britain and the United States recently raised interest rates.

Okamura was a Japanese former vice finance minister for foreign affairs. He also stated that the COVID-19 Pandemic, war in Ukraine, and tighter global financial circumstances would make the year challenging for Asia.

According to him, the war was having an adverse effect on Asia because of higher commodity prices in Asia and slow growth in Europe.

Okamura spoke out at the first media event after he was appointed one of four vice managing directors of the global lender.

He stated that there is the possibility of inflation expectations drifting, which could lead to a more severe tightening.

Okamura demanded clear communication and policies that are well-thought out.