Japan to 'continue to buy' EFSF bonds: official

"The Japanese government will continue to buy the EFSF bonds that we have been issuing," Klaus Regling said after meeting with Takehiko Nakao, Japan's top financial diplomat in Tokyo, on Monday, Kyodo news reported.

Japan has so far purchased around 20 per cent of the debt issued by the continent's bailout fund, and had indicated its willingness to buy more.

After a marathon meeting in Brussels last week EU leaders announced measures including quadrupling the firepower of the fund to one trillion euros ($1.4 trillion) from 440 billion euros.

But with the European governments wary of putting more money into the fund, Regling was forced to look abroad.

He arrived in Tokyo over the weekend after a visit to Beijing during which China said it would seek more clarity before stumping up cash for the bailout.

On Friday Prime Minister Yoshihiko Noda offered vague promises that he would help Europe overcome its sovereign debt crisis, but gave no details on what form this help might take.

"During the upcoming G20 summit, I will map out Japan's contribution to settling down the global economic crisis sparked from Europe," Noda told parliament, referring to the gathering of global heads in France next week.

"Our determination and capacity as politicians is challenged at a time like this when a storm blown from Europe is ripping through global financial markets."

His remarks, in a policy speech, came after Japan's Finance Minister Jun Azumi said Tokyo was ready to take "necessary measures" to help revamp the eurozone in the interests of its own economy.

Japan, already stumbling to recover from the effects of the March earthquake and tsunami and the nuclear emergency they sparked at Fukushima, is facing further headwinds from the slowdown in global trade.

The country's vital export sector is also battling a stubbornly strong yen, hitting profits and threatening domestic production, as investors flock to the currency as a safe haven, pushing up its value.

Manufacturers have been hit by the uncertainty over Europe's persistent debt problems.

After 10 hours of tense talks in Brussels, Europe's leaders on Thursday thrashed out a deal aimed at providing new funds to Greece in a bid to stop the region's crippling debt troubles sparking another global financial meltdown.