G-7 finance chiefs to discuss coronavirus impact on Tuesday
The G-7 finance ministers are expected to issue an emergency statement in which they plan to call for vigilance over the spread of the virus, considering it a downside risk to global growth, while affirming they will coordinate closely to minimize the impact, according to the official, Kyodo reports.
«We'll continue to deal with the coronavirus with a sense of crisis and alertness,» Japanese Finance Minister Taro Aso told reporters in the morning without confirming whether or not the G-7 ministers' discussions will be held.
«(The virus issue) has been causing a stir in countries such as Italy, so we'd like to cooperate with each country,» Aso added.
On Monday, French finance minister Bruno Le Maire said in an interview that the G-7 finance ministers will hold a conference call «this week» to address the global economic impact of the outbreak.
International Monetary Fund chief Kristalina Georgieva and World Bank Group President David Malpass issued a joint statement Monday, saying their organizations «stand ready to help our member countries address the human tragedy and economic challenge» posed by the virus, which originated in China.
«We will use our available instruments to the fullest extent possible, including emergency financing, policy advice, and technical assistance,» they said.
The planned G-7 talks come amid growing concerns over the negative economic effects of the COVID-19 outbreak and heightening expectations that the central banks of major economies may implement measures to stabilize financial markets, which have been fluctuating wildly on fears about the virus' worldwide spread.
The Organization for Economic Cooperation and Development on Monday lowered its forecast for the world's gross domestic product growth in 2020 to 2.4 percent from an earlier prediction of 2.9 percent, citing the impact of the pneumonia-causing coronavirus outbreak on the manufacturing and travel sectors.
The Paris-based organization said that global growth this year could even drop to 1.5 percent depending on virus-related developments.
U.S. Federal Reserve Chairman Jerome Powell suggested in an emergency statement on Friday that the central bank will consider lowering interest rates, saying, «We will use our tools and act as appropriate to support the economy.»
U.S. President Donald Trump, however, criticized Powell and the Fed as being «slow to act» in a Twitter post on Monday. «Germany and others are pumping money into their economies. Other central banks are much more aggressive. The U.S. should have, for all of the right reasons, the lowest rate,» he tweeted.
Bank of Japan Governor Haruhiko Kuroda issued Monday a rare emergency statement, saying that the central bank «will closely monitor future developments, and will strive to provide ample liquidity and ensure stability in financial markets through appropriate market operations and asset purchases.»
In June 2016, finance chiefs of the G-7 economies affirmed close cooperation to seek financial stability in a joint statement, after Britain's referendum vote to leave the European Union caused turbulence in global financial markets.
The G-7 groups Britain, Canada, France, Germany, Italy, Japan and the United States plus the European Union.