G7 vows strong global growth

The Group of Seven industrial powers pledged on Friday to seek strong global growth, while papering over differences on currencies and stimulus policies and expressing concern over North Korea, Russia and maritime disputes involving China.

G7 leaders wrapped up a summit in central Japan vowing to use “all policy tools” to boost demand and ease supply constraints.

“Global growth remains moderate and below potential, while risks of weak growth persist,” they said in a declaration. “Global growth is our urgent priority.”

Japanese Prime Minister Shinzo Abe, talking up what he calls parallels to the global financial crisis that followed the 2008 Lehman Brothers bankruptcy, said the G7 “shares a strong sense of crisis” about the global outlook.

“The most worrisome risk is a contraction of the global economy,” led by a slowdown in emerging economies, Mr Abe told a press conference after chairing the two-day summit. “There is a risk of the global economy falling into crisis if appropriate policy responses are not made.”

In the broad-ranging, 32-page declaration, the G7 committed to market-based exchange rates and to avoiding “competitive devaluation” of their currencies, while warning against wild exchange-rate moves.

The group condemned Russia’s “illegal annexation” of the Crimean peninsula from Ukraine. The declaration threatened “further restrictive measures” to raise the costs on Moscow but said sanctions could be rolled back if Russia implemented previous agreements and respected Ukraine’s sovereignty.

The G7 also called large-scale immigration and migration a major challenge and vowed to increase global aid for the immediate and long-term needs of refugees and displaced people.

Referring to Britain’s referendum in June on whether to leave the European Union, the G7 said an exit “would be a serious risk to global growth”.

The leaders also pledged to tackle a global glut in steel.