G7 finance ministers ended three days of talks in Niigata, Japan, with a statement pledging to control inflation, help countries struggling with onerous debt and strengthen financial systems.
In the joint statement, those responsible also pledged to collaborate in the creation of more stable and diversified supply chains for the development of clean energy sources and to “increase economic resilience around the world in the face of various shocks.”
The statement does not include any specific mention of China or “economic coercion” in pursuit of political goals, such as penalizing companies from countries whose governments take actions that anger another country.
The G7 finance ministers agreed on the “urgency” of solving the debt problems of low- and middle-income countries through multinational cooperation.
These vulnerabilities “should be resolved through multilateral coordination involving all official bilateral creditors acting swiftly,” said the joint statement released today at the end of the forum’s three-day meeting in the west coast city of Niigata. from Japan.
G7 financial authorities, joined in their talks by representatives of the European Union, India, Indonesia and Brazil, stressed the importance of private creditors “facilitating debt deals on terms at least favorable enough to ensure a fair distribution of the burden”.
The forum welcomed the voluntary channeling of special drawing rights and the additional contributions promised by Japan and France, which aim to provide more liquidity to the global economic system, and called on more countries to contribute to raising the value of the fund. to 100 billion dollars. .
The G7, which has set out to increase its alliances outside the group, is committed to strengthening economic collaboration and political dialogue with African countries.
In an unusual attitude in this forum, the Japanese presidency invited, this time, several emerging economies to participate, including the Comoros, current president of the African Union.
This approach is reportedly motivated by the group’s desire, among other things, to counter China’s growing influence in African countries through increased investment.
The G7 financial representatives also addressed the need for a coordinated and collaborative management of the climate crisis and the impact that the economy is having on it.
In this sense, they underlined the importance of migrating to more sustainable policies aimed at decarbonization and helping emerging economies to reduce their dependence on fossil fuels for the transition to be effective.
The finance leaders’ talks laid the groundwork for a G-7 leaders’ summit in Hiroshima next week, which President Joe Biden is expected to attend despite the crisis over the US debt ceiling. ., which could result in a national default if not resolved in the coming weeks.
While in Niigata, US Treasury Secretary Janet Yellen warned that failure to raise the debt limit to allow the government to continue paying its bills would unleash an economic catastrophe, destroying hundreds of thousands of jobs and could disrupt the world’s financial systems. No mention was made of this issue in the financial leaders’ statement.
The G7 economies account for only a tenth of the world’s population, but around 30% of economic activity, up from half 40 years ago. Developing economies such as China, India and Brazil have made enormous progress, raising questions about the relevance and role of the G7 in leading a world economy increasingly dependent on the growth of less wealthy nations.
Despite the recent turmoil in the banking sector, the G7 statement claims that the financial system is “resilient” thanks to reforms implemented during the 2008 global financial crisis.
“However, we must remain vigilant, agile and flexible in our macroeconomic policy, amid heightened uncertainty about the global economic outlook,” he said.
However, inflation remains “elevated” and central banks are determined to control it, he said.
The Group of Seven’s top financial leaders were united in their support for Ukraine and their determination to sanction Russia for its aggression, but they did not openly mention China.
Source: TSF
