NIIGATA, JAPAN (AP) – The Group of Seven’s (G7) top financial leaders united yesterday in their support for Ukraine.
The finance ministers and central bank chiefs ended three days of talks in Niigata, Japan, with a joint statement pledging to bring inflation under control, help countries struggling with onerous debts and strengthen financial systems.
They also committed to collaborating to build more stable, diversified supply chains for developing clean energy sources and to “enhance economic resilience globally against various shocks”.
The statement did not include any specific mention of “economic coercion” in pursuit of political objectives, such as penalising the companies of countries whose governments take actions that anger another country. The finance leaders’ talks laid the groundwork for a summit of G7 leaders in Hiroshima next week that United States (US) President Joe Biden is expected to attend despite a crisis over the US debt ceiling that could result in a national default if it is not resolved in the coming weeks.
Japanese Finance Minister Shunichi Suzuki said that Treasury Secretary Janet Yellen mentioned the issue in a working dinner, but he refrained from saying anything more. While in Niigata, Yellen warned that a failure to raise the debt ceiling to enable the government to continue paying its bills would bring an economic catastrophe, destroying hundreds of thousands of jobs and potentially disrupting global financial systems. No mention of the issue was made in the finance leaders’ statement. The G7’s devotion to protecting what it calls a “rules-based international order” got only a passing mention.
The leaders pledge to work together both within the G7 and with other countries to “enhance economic resilience globally against various shocks, stand firm to protect our shared values, and preserve economic efficiency by upholding the free, fair and rules-based multilateral system”, it said.
G7 economies comprise only a 10th of the world’s population but about 30 per cent of economic activity, down from roughly half 40 years ago. Developing economies like India and Brazil have made huge gains, raising questions about the G7’s relevance and role in leading a world economy increasingly reliant on growth in less wealthy nations.
