Ladies and gentlemen of the media, a very good afternoon.

It’s a great pleasure to be back in Japan for this G7 Summit.

My message to G7 leaders is clear: while the economic picture is uncertain everywhere, rich countries cannot ignore the fact that more than half the world – the vast majority of countries – are suffering through a deep financial crisis.

The crushing economic impact of the COVID-19 pandemic, the climate crisis, Russia’s invasion of Ukraine, unsustainable levels of debt, rising interest rates and inflation are devastating developing and emerging economies.

Poverty and hunger are rising; development is sinking.

As I see it, the problems facing developing countries have three dimensions: moral, power-related, and practical. 

First, moral.

There is a systemic and unjust bias in global economic and financial frameworks in favour of rich countries, which is naturally generating great frustration in the developing world.

Access to COVID-19 vaccines was deeply unfair.

The recovery has been extremely unbalanced. Rich countries recovered from the economic impact of the pandemic with expansionary monetary and fiscal policies. Trillions and trillions were spent. Basically, they printed money and spent their way out of trouble.

But developing countries, many with substantial debts, were unable to do so. If they did, they would have seen their currencies sinking.

On the other hand, the IMF allocated 650 billion US dollars in Special Drawing Rights – or SDRs – during the pandemic. The G7 countries, with a population of 772 million people, received 280 billion US dollars.

The African continent, with 1.3 billion people, received only 34 billion US dollars.

And this was done according to the rules. It was done by the book, but from a moral point of view, there is something fundamentally wrong with the rules themselves. 

Around the world, fifty-two countries are in technical default, at high risk of default, or face extremely expensive market financing. Middle Income Countries, including many small island developing states – with few exceptions – do not qualify for concessional funding and have no access to debt relief. 

Second, the power dimension.

The Bretton Woods system and the Security Council reflect the power relations of 1945.

And many things have changed since then. The global financial architecture became outdated, dysfunctional and unfair.

In the face of the economic shocks from the COVID-19 pandemic and the Russian invasion of Ukraine, it has failed to fulfil its core function as a global safety net.

It’s time to reform both the Security Council and the Bretton Woods institutions.

This is essentially a question of redistributing power in line with the realities of today’s world.

Third, the practical problem.

Even within the present unfair global rules, more can and must be done to support developing economies.

We have proposed an SDG Stimulus that would provide an effective mechanism for debt relief and scale up long-term and contingency funding.

If Multilateral Development Banks would work together and changed their business models and approach to risk, they could leverage enormous amounts of private finance for developing countries at reasonable cost. And without a massive amount of private finance there would be no effective climate action and there would be no way to implement the Sustainable Development Goals.

Massively reallocating SDRs – as Japan has done and others should follow –and channelling them through Multilateral Development Banks would have a multiplying effect on finance for sustainable development. 

Innovative financial tools could enable swaps that convert debt into investments in climate adaptation to build resilience in vulnerable communities around the world.
  
The list goes on.

But ladies and gentlemen of the media,

G7 countries are also central to climate action.

With the present policies, we are heading for a temperature rise of 2.8 degrees by the end of this century. The next five years are likely to be the hottest on record.

Climate action is working but not enough and we are clearly off track to limit temperature rise to 1.5 degrees Celsius by the end of the century.

The Acceleration Agenda I proposed aims to make up for lost time.
 
It calls for all G7 countries to reach net-zero as close as possible to 2040, and for emerging economies to do so as close as possible to 2050.

The Climate Solidarity Pact we suggested calls on all G7 countries, national and multilateral development banks, and the private sector, to mobilize financial and technical resources to support emerging economies that today are large emitters to accelerate decarbonization – so that we stay within the 1.5-degree limit of global heating.
 
And this requires faster timelines to phase out fossil fuels and ramp up renewables.

It means putting a price on carbon and ending fossil fuel subsidies.

It’s high time for developed countries to provide the promised $100 billion US dollars per year.

And the Loss and Damage Fund agreed in Sharm el-Sheikh must be operationalized.

Ladies and gentlemen of the media,

The city of Hiroshima is a testament to the human spirit. It’s my third visit to this city and I feel always very emotional when coming back.

Whenever I visit, I am inspired by the courage and resilience of the hibakusha.

The United Nations stands with them. We will never stop pushing for a world free of nuclear weapons.

I thank Japan for its generous support to the Youth Leader Fund for a World Without Nuclear Weapons. We must invest in and empower today’s young people to be changemakers for a safer and more secure world.

At the same time, Hiroshima is a global symbol of the tragic consequences when nations fail to work together and settle their differences peacefully.

In our multipolar world, as geopolitical divisions grow, no country or group of countries can stand by as billions of people struggle with the basics of food, water, education, healthcare, and jobs. 

Here in Hiroshima, it’s time to demonstrate global leadership and global solidarity.

Thank you.