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G7 fret over global growth prospects

Friday, May 27, 2016 - 01:37

On the final day of their summit in Japan, G7 leaders pledge to boost global growth - amid warnings of financial crisis. Kirsty Basset reports.

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A stark warning on the last day of the G7 meeting in Japan. (SOUNDBITE) (Japanese) JAPANESE PRIME MINISTER, SHINZO ABE, SAYING: "The greatest risk we face is that if we do not take appropriate action, the global economy will go beyond the range of usual economic cycles and fall into a crisis." Government sources say Abe will justify postponing a planned sales tax by as much as three years, saying it's part of the G7 effort to prevent another crisis. The G7 leaders agree their urgent priority is global growth, but talk of a crisis could be premature. (SOUNDBITE)(English) COMMERZBANK ANALYST PETER DIXON SAYING: "I think they may be overdoing it a little bit. Certainly the original Japanese attempt to insert a phrase into the statement warning of a repeat of the 2008-style meltdown was probably overdone. But obviously the G7 as a whole are concerned about global risks, justifiably I think." One that everyone is keeping an eye on is China. Its economy may be losing steam again, after profit growth at industrial firms slowed in April. It follows a string of disappointing economic data suggesting a challenging outlook. (SOUNDBITE)(English) COMMERZBANK ANALYST PETER DIXON SAYING: "I think as long as we have a stable Chinese economy then perhaps it'll be something which moves away from the list of things for markets to worry about but as and when things begin to heat up, uncertainty will of course percolate throughout the entire global financial system." And though they didn't explicitly mention China, the G7 also pledged to tackle a global glut in steel.

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G7 fret over global growth prospects

Friday, May 27, 2016 - 01:37