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G7 officials brush off calls for more unity

By Greg Keller

Associated Press

Published: Friday, Sept. 9 2011 4:55 p.m. MDT

Britain's Chancellor of the Exchequer George Osborne, left, sits with International Monetary Fund (IMF) Managing Director Christine Lagarde during a debate entitled 'Challenges for the Global Economy' at Chatham House in London, Friday Sept. 9, 2011. Osborne told journalists that the UK austerity plan is stable enough, although Lagarde warned about job prospects.

Facundo Arrizabalaga, Associated Press

MARSEILLE, France — The financial leaders of the world's most developed economies ignored calls for a stronger unified response to Europe's debt crisis, insisting Friday that each country should tread its own path back to growth amid concerns of a global slowdown.

The so-called Group of Seven economies — the U.S., Canada, Japan, Britain, France, Italy and Germany — are all facing a similar challenge. The recovery that began a little over a year ago is already running out of steam, but governments' ability to boost growth is hampered after the financial crisis pushed up their deficits.

Earlier as the financial ministers gathered in Marseille, France, Christine Lagarde, the head of the International Monetary Fund, had urged policymakers to take concerted action quickly.

That call didn't gain much traction.

"We must tread the difficult path of achieving fiscal adjustment plans while supporting economic activity," French Finance Minister Francois Baroin told reporters as he summed up Friday's discussions.

But he added that each country would have to respond differently and that the choice was not between austerity or growth.

That hedge seemed to reflect a general lack of strong unity at the meeting, which also failed to produce any big new measures.

Instead, the ministers recommitted to the measures they have already promised, including a new bailout for struggling Greece and expanding the powers of the eurozone's 440 billion euro bailout fund.

Markets, which have been exceptionally volatile in recent weeks, were either unimpressed with or ignored the meeting and headed severely down on Friday.

"For governments, to restore confidence in our decision-making process we need to respect the engagements we've made. That will reassure the markets," Baroin said.

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