NIIGATA (Japan) (AP). The world is at a 'historical turning point', says Japanese Prime Minister Fumio Kishhida, as the Group of Seven advanced economies gear up for a summit in Hiroshima next week.
As they concluded three days of meetings on Saturday in Niigata, Japan's port city, G-7 finance leaders are expected to show unity regarding support for Ukraine and strengthening of financial systems and supply chain. They will also discuss a variety of other global issues.
In a late-Friday statement, Kishida stated that the international community was facing a historical turning point. It is faced with divisions and conflicts, such as Russia’s invasion of Ukraine, and Sudan.
Kishida stated that the G-7 would'resolutely refuse the threat or use nuclear weapons, and uphold an international order based upon the rule of law'. As G7 Chairman, I will express my strong desire to make a difference in history.
The G-7 economies only account for a tenth (or 10%) of the global population, but they are responsible for 30% of all economic activity. This is down from about half (or 50%) 40 years ago. China, India, and Brazil are developing economies that have seen huge growth, which raises questions about the G-7’s role as the global economy leader.
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China has called out the U.S., and other G-7 nations for their hypocrisy in claiming that they were protecting a "rules-based international order" against "economic coercion" from Beijing and other threat.
Finance ministers and governors of central banks gathered in Niigata are facing a number of challenges to promote a strong, stable and prosperous world economy. The G-7 was to release a joint statement later that day to condemn Russia's war against Ukraine and to reiterate its commitment to support Ukraine "for as long it takes."
The group is also expected to express confidence in the global finance system, despite recent turmoil within the banking industry. There's also the possibility of a U.S. default on its national debt in the event that President Joe Biden or Congress fail to resolve the impasse regarding the debt ceiling before the government runs out funds to pay their bills.
Japan, as the host country of the G-7 meeting this year, also sought support to launch a "partnership" to strengthen supply chain to reduce the risks of disruptions like those experienced during the pandemic when supplies of products of all types, from medicine to edible oil to computer chips of high-tech, were in short supply.
During the G-7 talks in Japan, which is the only Asian member, tensions between China and Russia, over Russia's war against Ukraine, were prominent.
G-7 Finance Ministers and Central Bank Chiefs have said that they will discuss ways to stop what they call 'economic pressure' from China. Beijing reacted with sharp criticism.
Wang Wenbin, spokesperson for the Chinese Foreign Ministry, said on Friday that China was a victim of coercion.
If any country is to be criticised for its economic coercion it would be the United States. In a routine press briefing, Wang stated that the U.S. had been overextending the concept of national safety, abusing export control and taking unfair and discriminatory measures against foreign firms.
China claims that Washington is preventing its growth as a modern, affluent nation by imposing trade and investment restrictions. U.S. Treasury Sec. Janet Yellen claimed these were aimed at protecting American economic security.
When asked what G-7 countries meant by trying to stop "economic coercion", namely from China, Yellen cited the trade actions taken by Beijing against Australia.
She said, 'We share a concern about this type of activity in the G-7 and we are trying to figure out what we can do to counteract this behavior.
China's relationship with the European Union (a 27-nation bloc that is a G-7 member) has also been strained by friction over trade, and its tacit support of Russia.
The G-7 chiefs of finance also discussed how to stop countries from evading the sanctions imposed on Moscow to prevent it from continuing its war.
They have a broader responsibility to guide the global economy towards a sustained recovery after the pandemic, while reducing inflation which has soared to record highs over the last year.
Silicon Valley Bank, and other lenders, collapsed largely due to the increasing pressure on interest rates. By making borrowing more costly, they are intended to slow down business activity and reign in surging prices.