G7 finance leaders pledge financial stability, supply chain diversity

His release did not name China, but the language of supply chains spoke of “buddy-shoring” efforts by industrial democracies to work with each other to become less dependent on the Asian manufacturing powerhouse for battery minerals, semiconductors and other strategic goods. fits in with.

The G7 said, “We are committed to jointly empowering low- and middle-income countries to play a greater role in supply chains through mutually beneficial cooperation combining finance, knowledge and partnerships that drive sustainable development.” and help increase the resilience of supply chains globally.” finance ministers and central bank governors said in the statement.

Finance chiefs on the sidelines of International Monetary Fund and World Bank meetings in Washington said they discussed recent financial sector developments following the failure of two US banks and the forced sale of troubled global lender Credit Suisse. He said these “highlight the uncertainty about the global economic outlook and the need to remain cautious.”

He reiterated that the financial system is resilient, supported by quick government responses to upheaval and reforms implemented after the 2008 financial crisis.

“We will continue to closely monitor financial sector developments and stand ready to take appropriate actions to maintain the stability and resilience of the global financial system,” the G7 finance leaders said.

shared values’

The ministers noted that supply chains needed to achieve both efficiency and resilience to maintain macroeconomic stability and help make economies more sustainable. The statement cited the need to diversify “highly concentrated” supply chains for clean energy technologies.

“In this endeavor, we will be determined to defend our shared values ​​while maintaining economic efficiency while upholding an open, fair and rules-based multilateral system and international cooperation,” the G7 finance leaders said. Other autocracy.

The G7 is made up of the United States, Canada, Britain, France, Germany, Italy and this year’s chair, Japan – all wealthy industrial democracies.

The International Monetary Fund has warned in its latest economic forecasts that the fragmentation of the global economy across geopolitical blocs is a key factor in reducing long-term growth potential, with growth expected to grow by only 3% in 2028. The IMF began issuing such forecasts in the 1990s.

But French Finance Minister Bruno Le Maire, who attended the G7 meeting, said such diversification away from China and alliances with allies was necessary.

“We need to be more independent as far as the production of green hydrogen, or artificial intelligence or semiconductor chips, or electric batteries, or other strategic goods are concerned,” Le Maire told reporters.

joint research

In addition to working more closely with developing countries on supply chains, the G7 finance officials pledged to encourage joint research and development efforts between G7 members and other “interested parties”.

They will empower the private sectors in their countries to diversify their supply chains through the transparent and predictable use of public finance tools that catalyze private resources, they said.

The ministers also pledged to support education, training and skills development, “based on good governance and compliance with human rights” and to reduce greenhouse gas emissions and enhance environmental protection in their supply chains. (Reporting by Christian Kramer; Additional reporting by David Lauder and Andrea Schaal; Writing by David Lauder; Editing by Leslie Adler and Andrea Ricci)