G-7 moneymen to oppose protectionism
Finance ministers and central bank chiefs of the Group of Seven major economies plan to voice strong opposition to protectionism at their upcoming meeting in Rome, according to the agenda of the G-7 talks The Yomiuri Shimbun obtained Tuesday.
At the meeting, which will start Friday, the G-7 countries are also expected to discuss a new US financial rescue plan and agree on measures to further strengthen monitoring of financial institutions and markets.
Shoichi Nakagawa, finance minister and state minister in charge of financial services, and Bank of Japan governor Masaaki Shirakawa will attend the meeting.
The G-7 meeting, which will open with a dinner tomorrow, is scheduled to release a joint statement after Saturday's plenary session.
The focal point of the meeting is likely to be whether the G-7 countries can cooperate to stave off a growing trend toward protectionism, which contributed to worsening the Great Depression in the 1930s. The G-7 talks were originally intended to provide a forum to discuss financial issues. However, as the economic downturn is likely to continue, those attending the Rome meeting plan to discuss trade and the adverse effects of protectionism.
The US stimulus package bill, which has been discussed by Congress, includes a Buy American provision that will require the US government to favour US-made products in their procurement efforts. If such a move spreads around the world, trade volumes likely will decrease and may cause a spiral of negative effects, leading the global economy to shrink.
In light of this, countering protectionism has come up as the main theme of the G-7 talks.
During the meeting, participants also will discuss the progress of measures that were agreed upon at last year's financial summit to strengthen regulation and monitoring of financial markets and institutions and enhance the functions of the International Monetary Fund and the World Bank.
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