PARIS -- Finance ministers from the world's most industrialized countries Monday urged Germany and Japan to reduce interest rates and increase public spending to stimulate the world economy, but Bonn and Tokyo indicated they would not change policies under pressure.
Meeting on the first day of their annual summit, the finance ministers of the 24-member Organization for Economic Cooperation and Development discussed how best to reduce unemployment in their countries and insure that the current recovery does not go flat, as happened last summer.
But analysts said few if any concrete measures would be decided during the two-day Paris session that ends Tuesday. Major decisions would probably be made at the July summit of the world's seven richest countries in Munich when the extent of the current recovery would be clearer.
Many of the ministers, however, wasted little time in singling out Germany and Japan and in urging those governments to stimulate their internal growth.
'We expect the German government to create the conditions that will permit a lowering of interest rates,' British Treasury Secretary Michael Portillo told the opening session.
His comments were echoed by French Finance Minister Michel Sapin and the Italian representative, Umberto Vattani. Italy was not represented at the ministerial level because of the government crisis in that country.
'It is the high interest rates that are contributing to weak investments and growth,' Vattani said.
The United States also criticized Germany's economic policies, with Commerce Secreatary Barbara Franklin saying that high budget deficits 'rob public savings and investments.' Germany's deficit has risen substantially due to the higher than expected costs of reunification.
Johann Eekhoff, the German secretary of state, defended his government's policies, criticizing any short-term policy to stimulate the economy as shortsighted. He argued that Germany's priorities are the return to price stability and the reduction of its budget deficit.
Economic analysts said increasing government spending to stimulate growth is impossible because most industrialized countries have unusually high budget deficits. As expected, many of the 24 ministers urged Japan, one of the few member countries with its deficit under control, to increase internal demand by further increasing public spending.'
But Japan's minister of Industry and International Commerce, Kozo Watanabe, said his government would refuse to tailor its policies to the demands of the OECD.
The OECD, composed of the world's most industrialized nations, has reduced its forecast for world growth this year to 1 percent from the 2. 2 percent it predicted at the end of 1991. The OECD now expects growth in 1993 to be 3 percent rather than the 3.3 percent it predicted in December.
The Paris-based agency also revised the growth rate in the United States for next year to 3 percent from 3.8 percent and said that growth in Japan will be only 3.1 percent instead of the 3.5 percent previously expected. Germany's growth rate was revised downward to 2.3 percent from 2.5 percent.
While inflation in the 24-member countries is slightly lower than expected, unemployment remains the major problem. Unemployment in Europe is expected to reach 9.4 percent by early next year before falling back almost imperceptibly in the second half, according to OECD projections.
One of the most delicate problems before the finance ministers is how to handle the requests by 40 countries to join the organization, which is widely perceived as a rich man's club. Five countries -- Mexico, South Korea, Czechoslovakia, Hungary, and Poland -- already attend as observers in a number of OECD committees.
The organization, which provides technical assistance but no financial aid to countries, also maintains informal dialogues with fast- growing countries such as Taiwan, Malaysia, Singapore, and Thailand.
