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G-7 pledges $4.5 bil. for food security, to tackle China market abuse

A Group of Seven summit is held in Schloss Elmau, southern Germany, on June 27, 2022, with Ukrainian President Volodymyr Zelenskyy is participating online. (Pool photo/Kyodo)

MUNICH (Kyodo) -- Leaders from the Group of Seven industrialized nations on Tuesday committed $4.5 billion to address global food security amid Russia's war on Ukraine, while eyeing a "coordinated approach" to what they view as China's harmful economic practices, according to a senior U.S. government official.

    Later in the day, the G-7 will wrap up three days of talks in Schloss Elmau, southern Germany, where discussions have been largely dominated by rising inflation and shortages in energy and food, issues that have put the global economy in a perilous situation.

    With Russia seen using food as "weapon of war" such as by blocking Ukrainian grain exports at Black Sea ports, Britain, Canada, France, Germany, Italy, Japan and the United States plus the European Union said in a statement that their latest commitment on food security is to "protect the most vulnerable from hunger and malnutrition."

    "We reiterate our urgent call upon Russia to, without condition, end its blockade of Ukrainian Black Sea ports, destruction of key port and transport infrastructure...illegal appropriation by Russia of agricultural commodities and...all other activities that further impede Ukrainian food production and exports," the group said.

    According to the U.S. official, the leaders are also expected to agree to task their countries' ministers to work "urgently" toward developing a price cap on Russian oil, a move aimed at both squeezing Russia's finances and also minimizing the disruption in global energy markets and providing greater supply to the markets.

    On China, an "unprecedented" collective statement will be expected from the G-7, which will acknowledge the "harms" caused by what the members view as Beijing's nontransparent, market-distorting industrial directives, the official said.

    The leaders will commit to working together to develop a coordinated approach to "remedy" such practices to help ensure a level playing field for businesses, he said. China has often been accused of extensive use of industrial subsidies and intellectual property theft.

    Japanese Prime Minister Fumio Kishida attended the summit with an eye on setting the stage for next year when Japan takes over the G-7 presidency from Germany.

    With Russia showing few signs of ending its onslaught, Kishida is expected to explain that having Hiroshima host the 2023 leaders' gathering will be a symbolic step in promoting peace given the city, which was devastated by an atomic bomb during World War II, is an example of the horrors of war.

    Since Russia's invasion began in February, the G-7 has rolled out a raft of sanctions to hold Moscow accountable for the war, including asset freezes and disconnecting Russia from a key international payment system. Fresh punitive measures agreed on during the summit include a ban on gold imports from major producer Russia.

    Despite some G-7 members' dependence on Russian energy sources, the group has also imposed sanctions targeting crude oil and coal.

    With higher energy, raw material and food prices threatening to curb economic growth, major economies are scrambling to tame cost-push inflation at levels unseen in years, while rejecting Russia's assertion that Western sanctions are to blame for shortages.

    "We remain appalled by and continue to condemn the brutal, unprovoked, unjustifiable and illegal war of aggression against Ukraine by Russia and aided by Belarus," the G-7 leaders said in a statement Monday. "This devastating war has produced dramatic consequences far beyond Europe."

    For Japan, the war in Ukraine has increased concern that China could be emboldened in the Indo-Pacific region where it has become increasingly assertive.

    Kishida has told his G-7 counterparts the group should prevent other countries -- most notably China -- from taking the "wrong lessons" from Russia's use of force to change the status quo.

    In a counter to Beijing's "Belt and Road" cross-border infrastructure scheme, the G-7 launched its own plan to promote development among low- and middle-income nations by announcing a program to make available $600 billion by 2027.

    The G-7 leaders are expected to highlight in the envisioned communique China's role in enticing developing nations into so-called debt traps, apparently in connection with Belt and Road initiative that critics say is intended to draw countries deeper into Beijing's economic orbit.

    The communique will also include language on Taiwan, a self-ruled island that Beijing views as its own, the U.S. official said, noting that the wording would be "very similar" to last year's G-7 summit statement.

    The communique last year underscored "the importance of peace and stability across the Taiwan Strait."

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