2023-05-13 11:26:56
The G7 countries decided on Saturday May 13 to put in place by the end of 2023 ” at the latest “ a new mechanism to diversify global supply chains, a way to notably reduce their dependence on China in this strategic area.
This system will combine financial aid, exchanges of know-how and partnerships for low- and middle-income countries, to help them play higher value-added roles in this key process for the global industry, according to a communiqué of the G7 finance ministers published at the end of their meeting in Niigata (central Japan).
“Strengthening a resilient and inclusive supply chain”
Called Rise (“Resilient and Inclusive Supply-chain Enhancement”, or “strengthening a resilient and inclusive supply chain” in French), this mechanism, the main lines of which had already been unveiled in April, will be carried out in collaboration with the World Bank and other competent international organizations, it is specified. The financial envelope dedicated to this new instrument has not yet been determined.
Concretely, Rise should, for example, help countries to no longer only ensure the extraction of raw materials for industry, but also to make them capable of processing them on site, which would make it possible to partially do without China to ensure such services.
Rise, not presented as an anti-Chinese instrument
This approach embraces a concept shared within the G7 aiming to reduce risks in supply chains but without “decoupling” with China. The G7 finance ministers did not present Rise as an anti-China instrument, and China was not named anywhere in their press release.
“Diversifying supply chains can help preserve energy security and help us maintain macroeconomic stability”justified the ministers. “The pandemic has shown us the downsides of too much concentration of supply chains in one place”added Japanese Finance Minister Shunichi Suzuki at a press conference, as the long confinements in China had caused major disruption for the global industry last year.
“Unwavering” support for Ukraine reaffirmed
The G7 countries (United States, Japan, Germany, United Kingdom, France, Italy and Canada) also reaffirmed their support on Saturday “unwavering” to Ukraine and their condemnation of the “illegal and unjustifiable war of aggression” led by Moscow.
Their budgetary and economic support for Ukraine has been increased to 44 billion dollars (40 billion euros) for 2023 and the beginning of 2024, they announced on Saturday, compared to 39 billion dollars (36 billion euros) during their a previous tally in February.
They also reiterated their determination to “counter any attempt” to circumvent G7 economic and financial sanctions against Russia, but without announcing specific new measures or naming specific countries.
The fear of an American default
The Niigata meeting, which was also attended by G7 central bankers and heads of major organizations such as the International Monetary Fund (IMF) and the World Bank, also touched on many other issues, from banking sector concerns to global fight against global warming.
The current deadlock in negotiations in Washington on raising the American public debt ceiling, which raises fears of an unprecedented default by the United States this summer, also hovered over the Niigata meeting, without being an official subject. debated.
General rehearsal before the G7 in Hiroshima
This three-day meeting was above all a forum for informal exchanges, with the air of a dress rehearsal before the G7 leaders’ summit organized in Hiroshima (western Japan) at the end of next week. Support for Ukraine, monitoring sanctions against Russia, relations with China and economic resilience are expected to dominate this summit.
The G7 is also eagerly awaited on the issue of funding for developing countries, in particular to support their energy transition and help them limit the impact of global warming on their economies and populations.
An international summit aimed at creating a “New financial pact” face of the climate challenge is also scheduled for the end of June in Paris, an important step to create momentum on this subject before the United Nations climate conference (COP28) scheduled for Dubai at the end of the year.
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