Following the sharp worldwide decline in stock prices, Japan's business leaders on Tuesday expressed serious concern over the nation's economic prospects and called for effective government measures to shore up the country's economy.

Many urged the government to implement tax reforms such as corporate tax cuts and land-related tax reduction.

Keiichi Konaga, vice chairman of the Japan Federation of Employers' Associations (Nikkeiren) and president of Arabian Oil Co., said that the nation's economy is in a serious condition. "Despite the recent announcement of an economic package by the Liberal Democratic Party, stock prices remain low, and that shows how the market perceives the current state of economy," Konaga said. To ensure an economic recovery, tax reforms that include the reduction of corporate and land-related taxes are indispensable, he said.

Shoichiro Toyoda, chairman of the Japan Federation of Economic Organizations (Keidanren), agreed. "An international scheme that can drive away people's growing concern over Asia's currency crisis should be established," he said.

Kosaku Inaba, chairman of the Japan Chamber of Commerce and Industry, said that the government should implement income tax reductions in addition to other tax cuts. He also said that small and medium-size enterprises are having a difficult time obtaining necessary funds for their businesses, and government-related financial institutions must not hesitate to expand their loans to these companies.