Finance ministers and central bank governors of the Group of Seven industrial countries met on October 6 in Washington, DC, to discuss international efforts to combat the financing of terrorism and to address the impact the September 11 attacks may have on the global economy. In addition to a statement issued at the end of the one-day meeting, the Group of Seven ministers and governors also released their Action Plan to Combat the Financing of Terrorism (see page 328).
In their statement, ministers and governors said, “we stand united in our commitment to vigorously track down and intercept the assets of terrorists and to pursue the individuals and countries suspected of financing terrorists. We will implement United Nations (UN) sanctions to block terrorist assets.” [See related story, page 329.] Group of Seven officials said they were encouraged by the number of countries throughout the world that have already joined in international action to wage a successful fight against the financing of terrorism and welcomed the decision by the Financial Action Task Force to hold an extraordinary plenary session in Washington on October 29 and 30 to expand its mandate for combating terrorist financing.
On the economic impact, the Group of Seven statement noted that the September 11 attacks “could delay the resumption of strong growth in our economies … [but], notwithstanding remaining short-term uncertainties, we are confident about our future prospects. We are strongly committed to bringing forward needed measures to increase economic growth and preserve the health of our financial markets. We will continue to monitor exchange markets closely and cooperate as appropriate.”
Turning to the prospects for emerging market and developing economies, which have already felt the effects of the slowdown of economic activity in the industrial economies, ministers and governors said these countries could be affected by the uncertainty following last month’s attacks, and the prospects of the poorest countries could be damaged. However, ministers and governors pledged to take all necessary steps to mitigate these effects. They also urged countries adversely affected by recent developments to create the conditions for strong economic growth and sustained private capital flows. “The international financial institutions,” the statement said, “stand ready to assist.”
On global integration and linkages among the world’s people, the Group of Seven officials said increased productivity growth and a higher rate of potential growth are key to raising living standards and reducing poverty. They pledged to do so by “promoting free trade and regulatory reform, strengthened capital markets, and enhanced educational opportunity.”
Noting that greater economic integration calls for increased international cooperation to support sound governance and strong institutions, the statement said “we will continue to take steps to address dislocations associated with economic adjustment and work to ensure that all can benefit from integration, including through well-targeted and well-coordinated development assistance, effective implementation of the HIPC [Heavily Indebted Poor Countries] Initiative, and poverty reduction strategies.”
Ministers and governors welcomed Russia’s continued economic growth, progress on reform, and ratification of new anti-money laundering legislation.
The full text of the Statement of the Group of Seven Finance Ministers and Central Bank Governors is available on the U.S. Treasury Department’s website at http:www.treas.gov/press/releases/po669.htm.