G7 united against Brexit but can only hope for an 'In' vote

Sat May 21, 2016 5:45am EDT
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By Stanley White and Megumi Lim

SENDAI, Japan May 21 (Reuters) - Finance leaders of the Group of Seven industrial powers united over the weekend in wishing that Britain stays in the European Union, but acknowledged they could do little more than hope.

"The G7 did not talk about a Plan B to respond to what would happen if Britain left the European Union," French Finance Minister Michel Sapin told Reuters on Saturday. "We talked about ways to help Britain stay in the EU."

Britain's momentous referendum on whether to stay in the EU has been a prime issue for global markets and policymakers, who can largely only wait and see what Britons will say at the polls on June 23.

The ups and downs of polling data have swayed financial markets for months. Concern over the looming vote is a major risk for the Federal Reserve, which has indicated it may raise U.S. interest rates at its mid-June meeting but expressed concern about a "Brexit."

Sapin did not elaborate on any steps the G7 discussed to keep Britain in the EU, during an interview on the sidelines of their meeting of finance ministers and central bankers in Sendai, northeast Japan.

"A Brexit would have heavy consequences," Sapin said. "It would be bad for Britain and bad for Europe, because investors would have doubts and this would affect capital flows."

But G7 ministers were able to do little but rally around Prime Minister David Cameron's call for the EU's second-largest economy to remain in the union.

"We clearly are concerned, collectively, at the risk of Brexit and do believe that could potentially have some economic impacts," Canadian Finance Minister Bill Morneau told Reuters in Sendai. But he added, "We haven't spoken of specific measures that might be taken in that regard."   Continued...