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G7 search for holy grail: growth

Wednesday, May 25, 2016 - 01:43

Japan's Prime Minister Shinzo Abe says he hopes the G7 summit will deliver a ''strong message'' about the global economy. But, as David Pollard reports, agreements on how to tackle the slowdown may be hard to reach.

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(TV TOKYO - Broadcasters: NO ACCESS JAPAN/CNN & CNNI, BBC WORLD, NBC, CNBC MUST ON-SCREEN COURTESY 'TV TOKYO' IF PICTURES TO BE SHOWN ON CABLE, COMMUNICATIONS SATELLITE IN JAPAN. Digital: NO ACCESS JAPANESE WEBSITES) If Shinzo Abe had a balance sheet of global growth, he might put a new Greek debt deal, rising oil prices and better euro zone data under assets. China and Brexit under liabilities. And Japan itself: struggling with a strong yen, a row over a controversial sales tax hike, and insipid growth. (SOUNDBITE) (Japanese) JAPANESE PRIME MINISTER, SHINZO ABE, SAYING: "I want to make this a summit during which the G7 sends a clear, strong message to respond to all situations and contribute to the sustainable, strong growth of the world economy." Then there's the prospect of a Fed rate hike. The US no doubt keen to flag that as a signal of a return to normality. Others worried about the drag on emerging markets. (SOUNDBITE) (English) FIDELITY WORLDWIDE INVESTMENT, INVESTMENT DIRECTOR, TOM STEVENSON, SAYING: "Japan is very much keen on coordinated government spending, fiscal stimulus to boost the global economy. Germany, on the other hand, is much more interested in instituting more long-lasting economic reforms." And Brexit will be high on the agenda - the UK's June referendum getting closer. Though with polls pointing to a narrow win for David Cameron's campaign to stay in the EU, there too investors see little call to joint G7 action. (SOUNDBITE) (English) FIDELITY WORLDWIDE INVESTMENT, INVESTMENT DIRECTOR, TOM STEVENSON, SAYING: "What we'll end up with is a compromise. We'll have a statement which talks about fiscal stimulus, talks about monetary stimulus, and talks about economic reform. So, in a way, it's going to be apple-pie and motherhood." Just before the summit, Abe was paying his respects at one of Japan's most revered Shinto shrines. The visit for some making unwelcome associations with Japan's imperialist past. For others, a hint perhaps that even global leaders need a little help from above as they search for the holy grail: growth.

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G7 search for holy grail: growth

Wednesday, May 25, 2016 - 01:43