06 February 2008

G7 to talk with Russia, three Asian economies

The Group of Seven financial leaders will hold an "outreach" session Saturday with China, South Korea, Indonesia and Russia to discuss macroeconomic conditions, Finance Minister Fukushiro Nukaga said Tuesday.

After their one-day meeting, finance ministers and central bank governors from Britain, Canada, France, Germany, Italy, Japan and the U.S. will meet officials from the four economies over dinner, a Finance Ministry official said.

Nukaga reiterated that as chair of the Tokyo gathering, Japan intends to work out a G7 message to stabilize global financial markets rattled by the U.S. subprime mortgage crisis.

"We will discuss how current uncertainty over financial markets and high oil prices will affect the real economy," he told reporters. "It is important to regain market participants' confidence and stabilize the markets by disclosing losses suffered by financial institutions" hit by the U.S. subprime meltdown.

Nukaga indicated Tokyo can explain to the rest of the G7 members its experience from the financial crisis following the collapse of the asset-inflated economic bubble in the early 1990s.

He said Japanese financial entities' disclosure of damage resulting from that mess sent a reassuring message to market participants.

© Graham Bishop