The G7 finance ministers have issued a warning about the "heightened uncertainty" surrounding the world economy and the need, in the wake of financial sector unrest, to address regulatory gaps in the banking system.
Following a three-day ministerial meeting in Japan on Saturday, the world's most developed economies said in their closing statement that "the global economy has shown resilience against multiple shocks."
Despite the increased uncertainty surrounding the outlook for the global economy, we must maintain our vigilance and be adaptable and flexible in our macroeconomic policy.
Also Read: The US will engage Iran with fresh naval deployments
The failures of Silicon Valley Bank, Signature Bank, and First Republic in recent weeks, as well as the need to close "data, supervisory, and regulatory gaps" in the banking system, were all mentioned by the finance ministers.
In recent months, the US and its G7 allies have prioritised closing sanctions loopholes and stopping evasion as the desire to impose restrictions on new facets of Russia's economy has waned more than a year after Russia's full-scale invasion of Ukraine.
In light of this, the finance ministers also decided to increase intelligence sharing on potential sanctions evasion and keep an eye on the success of price caps on Russian crude oil and petroleum products. The communique stated, "We remain committed to thwarting any attempts to evade and undermine our sanction measures."
The G7 agreed to give Ukraine $44 billion in economic support, which allowed the IMF to approve a $15.6 billion, four-year lending programme.
"It was a big achievement for us that the G7 was able to strengthen its unity rather than going in separate ways to address major international challenges," said Shunichi Suzuki, the finance minister of Japan, on Saturday.
In order to prevent crucial components from reaching the Ukrainian battlefield, Brussels is also reportedly discussing restrictions on some EU exports to nations that it suspects are re-exporting sanctioned products to Russia.
US Treasury Secretary Janet Yellen had urged "coordinated action" by G7 nations against Beijing's use of economic coercion prior to the finance ministers' meeting. The G7 agreed to release a framework for supply chain cooperation in clean energy by the end of the year, but the 14-page document made no mention of worries about China's economic security.
Also Read: Zelensky will visit the Vatican in Rome and meet with Pope Francis
As Washington completed a new outbound investment-screening system targeted at China, Yellen made the remarks.
A senior member of the Japanese finance ministry acknowledged that the topic of economic coercion came up during the meeting but would not elaborate or say whether China was brought up specifically.
