MNI EXCLUSIVE: France Moots G7 Communique Skip Over US Spat

--U.S., Other Sherpas Push For G7 Reassurance As Global Economy Deteriorates

by David Thomas

     LONDON (MNI) - French President Emmanuel Macron is pushing for G7 leaders

to abandon their customary communique following their summit in Biarritz,

France, next week in a bid to try and avoid the embarrassing disputes over

wording which pitted U.S. President Donald Trump against the rest of the group's

leaders at last year's Charlevoix, Canada, gathering.

     But sources close to France and the EU say that some G7 sherpas, including

the U.S. itself, are pushing back, arguing that the deterioration of global

economic conditions is too serious for the G7 not to issue some kind of

'reassurance' statement about this part of the discussions, albeit if only a

summary of the talks to try and reassure markets.

     "It's important for some to show that we are at least discussing these

issues," one source close to the Sherpa preparations for the G7 said.

     --POLICY THEMES

     Sources close to the French presidency characterise the new approach of the

G7's 2019 chair as a "pragmatic" one, given the recent embarrassing discords

over the G7 communique drafting process and the need to keep the U.S. "at the

table", while at the same time conceding that it is impossible to reflect many

of the differences of views between the U.S. and the rest of the G7 on big

policy themes, such as international aid and climate change.

     "It's a way of saying, 'let's just move on'," said one official, "but let's

keep the strategic dialogue going among ourselves and see what we can hang on

to."

     "We still have strategic links with the U.S. and shared values, and we want

to have that discussion that promotes our values."

     Sherpas are due to meet next week ahead of the August 24 - 26 summit in

Biarritz, France, with one source saying that the meeting may "provide more

clarity" on whether and what kind of a text on the global economic situation and

the stance of G7 policymakers can and should be released.

     "Given the evolution of the global economy and the whole discussion on how

to support growth, on foreign exchange developments, on tariffs, ECB, other

central bank warnings on growth. All of this has to be discussed by G7 leaders

and some kind of text on this needs to be released," one source said.

     "We just need to show the outside world that we are discussing these

things."

     --DIFFICULTIES

     Officials concede, however, that sharp differences of views between the

current US administration and European G7 member states on issues such as trade,

monetary policy and foreign exchange will make the customary agreed text

difficult to achieve.

     Reflection of the changing nature of the G7 agenda, with issues such as

reducing economic inequality, Africa and women's empowerment topics featuring

more strongly in the talks, which formerly focused on macroeconomic

developments. In addition, the involvement of multilateral agencies like the

IMF, World Bank, UN and WTO in the talks this time round, as well as a number of

leading non-government agencies, will make communique on those parts of the

discussions highly elusive.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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