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G7, Russia Agree to Work to Boost Domestic Economies - 2003-02-22

Group of Seven ministers from industrialized nations plus Russia agreed Saturday to work on boosting their domestic economies amid a gloomy world financial outlook. The ministers also addressed the effects of the Iraqi crisis during their meeting in Paris.

U.S. Treasury Secretary John Snow told reporters Saturday that the finance ministers agreed that the Iraqi crisis added to the world's economic problems, and a quick solution would be best.

"There was a recognition that the geopolitical situation that we find ourselves today in the G-7 is an important backdrop," he said. "It is influencing markets and serving as a restraint to capital expenditure and equity expenditure. There was the expectation that once the situation resolves itself, both capital spending and equity markets would respond." Mr. Snow spoke during a one day meeting of ministers from industrialized nations, ahead of a June summit in the French city of Evian.

Ways to solve the Iraqi crisis have split members of the group, with the U.S. considering military action, and France and Russia urging a peaceful solution.

Besides war jitters, slow growth in Asia, Europe and the United States, along with the continued slide in the stock market, have all undermined world economic growth.

Nonetheless, the ministers announced they were confident of an economic rebound, and pledged to take steps to revive their own, domestic economies.

Jump starting African economies was also a top item at the Paris meeting. French Finance Minister Francis Mer outlined France's so-called "affirmative action" plan for Africa, which will be discussed during the Evian summit.

Mr. Mer said Africa needed a transition period, in which it could benefit from more favorable financial terms. He pointed out that the summit would address ways to better help African nations combat AIDS, and improve their health care and access to drinking water.

Earlier this week, French President Jacques Chirac proposed a 10-year period in which Africa could benefit from favorable terms of trade. Mr. Chirac outlined his suggestion at a Franco-African summit in Paris.