G7 Financial Leaders Vow More Cyber Cooperation And Reiterate FX Pledges

Not to use foreign exchange to gain competitive advantage, but sticking to their cautious wording on trade is the strategy of the financial leaders of seven leading world economies against cyber crime who pledged stronger cooperation against cyber crime.

In order to discuss the world economy, combating terrorist funding, cyber security and taxes, finance ministers and central bank governors from the United States, Canada, Japan, France, Germany, Italy and Britain met in the Italian city of Bari.

To boost economic growth, the seven countries would use all policy tools – fiscal, structural and monetary, the final communique of the meeting said.

To counter cyber threats such as a global online attack which infected tens of thousands of computers in nearly 100 countries on Friday, the G7 financial leaders would strengthen cooperation, it also said.

monetary policy should help economic activity without fuelling strong inflation and fiscal policy should be used to help job creation while keeping public debt on a sustainable path, the statement said.

“We reaffirm our existing G7 exchange rate commitments to market-determined exchange rates and to consult closely in regard to actions in foreign exchange markets,” it said.

“We reaffirm our fiscal and monetary policies have been and will remain oriented towards meeting our respective domestic policy objectives, using domestic instruments and we will not target exchange rates for competitive purposes,” it said, underlining the importance of refraining from competitive devaluations.

But reflecting pressure from the United States where President Donald Trump has signaled his scepticism about free trade deals, the Bari meeting did not endorse free trade and reject protectionism, unlike a G7 leaders’ communique of 2016.

“We are working to strengthen the contribution of trade to our economies”, was a line agreed by the broader Group of 20 in March and the G7 financial leaders repeated that line.

agreed by the broader Group of 20 in March which said: “We are working to strengthen the contribution of trade to our economies.”

“We recognize that cyber incidents represent a growing threat for our economies and that appropriate economy-wide policy responses are needed,” the G7 financial leaders said as a global cyber attack infected tens of thousands of computers in nearly 100 countries on Friday.

They stressed the importance of effective measures to assess cyber security among individual financial firms and at sector level even as they called for common shared practices to spot quickly any vulnerabilities in the world’s financial system.

Italian finance minister Pier Carlo Padoan told reporters that the discussions, which had been scheduled before Friday’s attacks, were “unfortunately very timely.”

(Adapted from Reuters)


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