The world is facing a “historic turning point,” Japanese Prime Minister Fumio Kishida says, as Group of Seven advanced economies prepare for a summit next week in Hiroshima.
G-7 finance leaders were expected to confirm a show of unity on support for Ukraine, strengthening financial systems and supply chains and a range of other pressing global issues as they wrapped up three days of meetings in the Japanese port city of Niigata on Saturday.
“The international community is facing a historic turning point, facing divisions and conflicts such as Russia’s invasion of Ukraine and Sudan,” Kishida said in a statement issued late Friday.
The G-7 will “resolutely reject the threat or use of nuclear weapons and uphold the international order based on the rule of law,” Kishida said. “As G7 chairman, I will convey my strong will to have an impact on history.”
The G-7 economies comprise only a tenth of the world’s population but about 30% of economic activity, down from roughly half 40 years ago. Developing economies like China, India and Brazil have made huge gains, raising questions about the G-7's role in leading the world economy.
China has blasted as hypocrisy assertions by the U.S. and other G-7 countries that they are safeguarding a “rules based international order” against “economic coercion” from Beijing and other threats.
The finance ministers and central bank governors gathered in Niigata face a host of challenges in promoting a strong and stable world economy. A joint statement to be released later in the day was due to reiterate the G-7's condemnation of Russia for its war on Ukraine and its determination to support Ukraine “for as long as it takes.”
The group was also expected to voice confidence in the global financial system despite recent turmoil in the banking industry and the potential of a default on the U.S. national debt if President Joe Biden and Congress do not resolve soon an impasse over the debt ceiling as the government runs out of funds to pay its bills.
As host of the G-7 this year, Japan was also seeking support for launching a “partnership” to strengthen supply chains to reduce the risk of disruptions similar to those seen during the pandemic, when supplies of items of all kinds, from medicines to edible oil to high-tech computer chips, ran short in many countries.
Tensions with China, and with Russia over its war on Ukraine, have loomed large during the talks in Japan, the G-7's only Asian member.
The G-7 finance ministers and central bank chiefs said they would discuss ways to prevent what they are calling “economic coercion” by China. That drew sharp retorts from Beijing.
China is a victim of economic coercion, Chinese Foreign Ministry spokesperson Wang Wenbin said Friday.
“If any country should be criticized for economic coercion, it should be the United States. The U.S. has been overstretching the concept of national security, abusing export controls and taking discriminatory and unfair measures against foreign companies,” Wang said in a routine news briefing.
China accuses Washington of hindering its rise as an increasingly affluent, modern nation through trade and investment restrictions that U.S. Treasury Secretary Janet Yellen said were narrowly targeted to protect American economic security.
Asked what G-7 countries mean by trying to prevent “economic coercion," namely by China, Yellen cited trade actions by Beijing against Australia as one example.
“We in the G-7 share a common concern with this kind of activity and are looking to see what we can try to do to try to counter this kind of behavior,” she said.
China's relations with the 27-nation European Union, which is also a member of the G-7, have also been frayed by friction over trade and over its tacit support for Russia.
The G-7 financial chiefs also discussed ways to prevent countries from skirting sanctions against Moscow meant to hinder its ability to continue the war.
Their broader responsibility is to help guide the world economy toward a sustained recovery from the pandemic while cooling inflation that surged to multi-decade highs in the past year.
The collapses of Silicon Valley Bank and other lenders stemmed largely from the pressure of interest rate hikes that, by making borrowing more expensive, are designed to slow business activity and rein in surging prices.
Associated Press journalist Haruka Nuga contributed.