In the backdrop of a grim global economic scenario, the G7 industrialised nations have stressed on reviving global growth and discussed steps to prevent another major crisis.
“Global growth remains moderate and below potential, while risks of weak growth persist,” the G7 leaders said after a two-day summit in central Japan. “Global growth is our urgent priority.” The G7 summit was held on May 26-27.
Emphasising on the need to take appropriate policy decisions, the G7 in a statement said: “We have strengthened the resilience of our economies in order to avoid falling into another crisis and, to this end, commit to reinforce our efforts to address the current economic situation by taking all appropriate policy responses in a timely manner.”
The G7 nations reiterated their commitment to market-based exchange rates and agreed to avoid “competitive devaluation” of their currencies. They also warned against wild exchange-rate moves. The G7 agreed to implement a more forceful and balanced policy mix to “achieve a strong, sustainable and balanced growth pattern.” The G7 also decided that they would take each country’s circumstances into account, while continuing efforts to put public debt on a sustainable path.
Impact of global issues on growth
Focusing on important global issues that are likely to impact global growth, the G7 discussed the issues of South China Sea, North Korea and Brexit – the prospects of Britain’s exit from the EU. Without mentioning Beijing directly, the G7 reiterated its commitment to the peaceful settlement of maritime disputes and to respecting the freedom of navigation and overflight.
Britain’s referendum in June on whether to stay in the European Union was also discussed by the members. The G7 said that an exit “would be a serious risk to global growth.
The members also demanded that North Korea should fully comply with United Nations Security Council resolutions and halt nuclear tests, missile launches and other “provocative actions”.
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