Washington: The Group of Seven major countries should come together to address China's tighter rare earth export controls, Japanese Finance Minister Katsunobu Kato emphasized during a meeting of the G-7 finance and central bank chiefs in Washington. Kato shared his concerns with reporters after the session, highlighting Japan's apprehension about China's measures.
According to Philippines News Agency, Kato's remarks came after a bilateral meeting with US Treasury Secretary Scott Bessent, where they reaffirmed a previous agreement from September. The statement emphasized that fiscal and monetary policies should not be used to target exchange rates for competitive purposes. Kato urged Bessent to continue promoting Japan's investment and loans to the United States as previously agreed upon during Japan-US tariff negotiations.
Bessent later posted on social media about the discussion with Kato, mentioning the US administration's expectation that Japan should cease importing liquefied natural gas from Russia due to ongoing geopolitical tensions arising from Russia's invasion of Ukraine. During the G-7 meeting, Kato, along with Bank of Japan Governor Kazuo Ueda and other participants, also addressed measures to support Ukraine.
The meeting, attended by representatives from Britain, Canada, France, Germany, Italy, Japan, and the United States plus the European Union, occurred amid growing friction between the US and China over China's rare earth export controls. This tension is seen as a destabilizing factor for the global economy. In response to US President Donald Trump's decision to impose additional tariffs on China, Beijing appears poised to retaliate.
Kato warned of the potential global economic impact if the situation escalates. "If our responses cause a chain of retaliation, that could adversely affect the global economy and markets," he stated. He stressed the importance of monitoring risks that could affect financial markets due to these developments.
Regarding the foreign exchange market, Kato noted recent rapid movements, particularly the yen's weakening, and expressed Japan's commitment to monitoring excessive and disorderly currency market activities closely.
Simultaneously in Washington, finance ministers and central bank chiefs from the Group of 20 advanced and emerging economies began a two-day meeting. The discussions are expected to focus on the impacts of the US high tariff policy on the global economy, as well as risks in financial markets and debt issues in developing countries.
