G-7 to Review Paris Accord in Washington - Lawson

The Group of Seven industrialised countries will make use of next week’s International Monetary Fund meetings in Washington to evaluate the Paris accord on currency stabilisation, U.K. Chancellor of the Exchequer Nigel Lawson told reporters.

“On Tuesday I shall be going to Washington for meetings of the (IMF) Interim Committee and Development Committee, and we shall of course be having a meeting of the G-7,” Lawson said.

“And on the G-7, although there is no formal agenda, I would imagine that the first thing we do would be to review how the Paris accord has gone since it was agreed in February.”

Lawson said G-7 finance ministers will be reviewing medium-term economic objectives and projections involving domestic and external variables. Also examined will be performance indicators for each country.

The Paris accord set objectives for such sectors as growth, inflation, current account and trade balances, budget performances, monetary conditions and exchange rates.

Lawson said “At both the G-7 and the Interim Committee we will undoubtedly be discussing the debt problem. Clearly the debt problem is still with us, and still with us in quite a big way.”

“In many ways the problems of the big debtor countries, and indeed the poorest countries, are every bit as acute as they were when they began. It will be with us for a very long time.”

Lawson said he knew of no new debt initiative which might be presented and discussed next week in Washington. “We’ve got to go on a case-by-case basis,” Lawson said. Possibilities for a coordinated approach to the problem would be something he would raise within the IMF, Lawson said.

He noted the rise this week in U.S. Short-term interest rates, and said that a significant rise in borrowing costs would make the debt problem more acute.

Special attention would go to Brazil next week, but Lawson added, “I do not expect anything to come to a head on that.”

Lawson said he told Brazilian Finance Minister Dilson Funaro here in February that Britain would not intervene and press British commercial banks into giving Brazil easier borrowing conditions. “I told him it was a matter for the banks, not governments,” Lawson said.

The IMF Interim Committee is to meet formally in Washington next Thursday, while the Development Committee was set to convene on Friday, Treasury officials said.