Japan's Abe fails in bid to have G7 warn of global crisis risk

[ISE-SHIMA, Japan] Japanese Prime Minister Shinzo Abe failed in his bid to have Group of Seven leaders warn of the risk of a global economic crisis, in a communique issued as their summit wraps up Friday in central Japan.

The final statement declares that G-7 countries "have strengthened the resilience of our economies in order to avoid falling into another crisis." Leaders had discussed a Japanese proposal to use stronger warning language.

Japan had pressed G-7 leaders to note "the risk of the global economy exceeding the normal economic cycle and falling into a crisis if we did not take appropriate policy responses in a timely manner."

On Thursday, Mr Abe presented documents to the G-7 indicating there was a danger of the world economy careering into a crisis on the scale of the 2008 Lehman shock.

Mr Abe has frequently said he would proceed with a planned increase in Japan's sales tax in April 2017 unless there is an event on the scale of the Lehman shock or a major earthquake. He is expected to announce next week he is deferring the tax rise, Japanese media reported.

The G-7 leaders also added in an 11th-hour warning on Brexit, saying the departure of the UK from the European Union would "reverse the trend towards greater global trade and investment and the jobs they create, and is a further serious risk to growth."

The warning was not included in the same section of a working draft of the communique as of Thursday evening.

BLOOMBERG