Finance chiefs from the Group of Seven nations see the need to urgently tackle emerging challenges posed by the widespread use of messaging apps and online banking, despite the financial system so far maintaining resilience in the wake of several U.S. bank failures, a Japanese government official said Friday.

As the possibility of a U.S. default looms over an ongoing three-day meeting of the G-7 finance ministers and central bank governors, the United States explained the current economic situation regarding its debt ceiling, the official added.

The gathering is partly meant to shore up confidence and ensure financial stability while seeking to establish coordination on addressing debt woes affecting low- and middle-income nations. U.S. Treasury Secretary Janet Yellen has warned of an "economic and financial catastrophe" if the U.S. defaults.

Finance chiefs from the Group of Seven nations attend a photo session during the second day of their three-day meeting in the city of Niigata, northwest of Tokyo, on May 12, 2023. (Kyodo) ==Kyodo

Japan, which holds the presidency this year, is aiming to set a clear schedule for the launch of a "mutually beneficial" partnership with low- and middle-income countries to build robust supply chains for critical products needed to tackle climate change through decarbonization.

During Friday's meeting, many were supportive of the plan, the official said.

One of the G-7's priorities is to make supply chains robust and more resilient to future risks at a time when China's strong position on critical technologies and resources, such as semiconductors and rare earth materials, is causing concern.

The finance chiefs' talks are laying the groundwork for the leaders' summit next week in Hiroshima, where they are expected to stand firm against Russia's war on Ukraine and China's increasing assertiveness in the Indo-Pacific.

The G-7 agreed on the need to support Ukraine "for as long as necessary" and to address efforts by Russia to circumvent sanctions imposed by the West for its unprovoked war on Ukraine.

A joint statement is expected on Saturday when the G-7 member states -- Britain, Canada, France, Germany, Italy, Japan and the United States plus the European Union -- wrap up their talks.

In a rare move, six other nations, including Brazil, India and South Korea, joined an outreach session to beef up coordination on debt issues and other global challenges.

The meeting comes as concerns about the global economy grip financial markets following the collapse of three major U.S. regional banks -- Silicon Valley Bank, Signature Bank and First Republic Bank.

"It's become clear that financial worries can spread in an instant via social networking sites. Additionally, online banking, which allows money withdrawals outside business hours, can cause bank runs," Japanese Finance Minister Shunichi Suzuki said Thursday.

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