G7 pushes action on trade imbalances amid divisions over Russia sanctions

Finance ministers from the G7 group of advanced economies agreed on the need to address global trade imbalances during talks in Paris, warning that the current situation was unsustainable amid rising economic uncertainty and ongoing geopolitical tensions.

The ministers and central bank governors discussed the economic impact of the US-Israeli war on Iran, volatility in global bond markets and disruptions to energy and supply chains, while reaffirming their commitment to multilateral cooperation, News.Az reports, citing France 24.

In a joint communiqué released after the meeting, the G7 highlighted “multiple and complex global challenges requiring coordinated responses” and warned that uncertainty was increasing risks to global growth and inflation.

The statement also stressed the need for a swift return to free and safe transit through the Strait of Hormuz, where shipping has been heavily disrupted following Iran’s blockade during the conflict.

French Finance Minister Roland Lescure said ministers held “frank, sometimes difficult” discussions aimed at finding both short-term and long-term solutions to global economic challenges. He added that all members shared the view that current trade imbalances were unsustainable, pointing to China’s under-consumption, US over-consumption and Europe’s under-investment.

Despite broad agreement on economic issues, divisions emerged over Russia sanctions after the United States extended a temporary waiver on sanctions covering Russian oil stored at sea.

EU Economy Commissioner Valdis Dombrovskis criticised the move, saying it was not the time to ease pressure on Moscow and arguing that Russia was benefiting from higher fossil fuel prices linked to the conflict in Iran.

US Treasury Secretary Scott Bessent said the extension was intended to provide flexibility and help stabilise the global crude market. European officials, however, expressed concern that the measure had already been extended beyond its original timeline.

The Paris meeting was held under France’s rotating G7 presidency ahead of a leaders’ summit scheduled to take place next mont.

News.Az 

By Leyla Şirinova