The Group of Seven finance chiefs on Thursday "unequivocally" condemned attacks on Israel by the Palestinian militant group Hamas and expressed concern about the situation in the Middle East, amid heightened uncertainty over the global economy already hit by Russia's war on Ukraine and high inflation.

The G7 finance ministers and central bank governors were united in their support of Israel during their meeting in the Moroccan city of Marrakech as the conflict has unnerved financial markets.

"We unequivocally condemn the recent terror attacks by Hamas on the State of Israel and express our solidarity with the Israeli people," the G7 said in a joint statement.

After chairing the meeting, Japanese Finance Minister Shunichi Suzuki said he expressed "serious concern" about the Israel-Hamas conflict, noting that the sentiment was shared by many others. Japan holds this year's presidency of the group of highly developed economies.

Japanese Finance Minister Shunichi Suzuki (C) speaks at the meeting of the G7 finance ministers and central bank governors in Marrakech, Morocco, on Oct. 12, 2023. (Photo courtesy of the Japanese Finance Ministry)(Kyodo)

Participants were concerned about the impact of the violence on crude oil prices, financial markets and the broader economy, a senior Japanese official said, without giving further details.

The G7 reaffirmed its unwavering support for war-torn Ukraine as the former Soviet republic seeks to defend itself against Russia and rebuild from destruction.

The group has implemented a spate of sanctions on Moscow for what it sees as "unprovoked" and "unjustifiable" attacks, in its effort to diminish the Russian war chest.

The finance chiefs said they will ensure that Russia pays for the long-term reconstruction of Ukraine, adding the group will "explore all possible avenues to aid Ukraine, consistent with our respective legal systems and international law."

The European Union has proposed using profits from frozen Russian assets to help fund Ukraine's reconstruction, an idea which U.S. Treasury Secretary Janet Yellen has reportedly backed.

Thursday's meeting was held on the fringes of gatherings organized by the International Monetary Fund and World Bank. It came at a time when entrenched inflation in the United States and European nations is raising the specter of additional rate hikes that could hamper economic growth.

Besides chair Japan, the group includes Britain, Canada, France, Germany, Italy and the United States, plus the European Union. Their finance chiefs previously met in July when they gathered in Gandhinagar, India, for a meeting of the Group of 20 economies.

Their agenda this time included building more robust supply chains to ensure economic security and reforming multinational development banks.

The G7 is seeking to make supply networks for critical components more resilient after the COVID-19 pandemic laid bare the vulnerabilities and national security risks of relying heavily on China.

In line with a G7 push to build robust supply chains with like-minded partners, Japan and other nations have decided to set up a fund to help developing nations process critical minerals and produce parts for solar panels and electric vehicles that are necessary for decarbonization.

Britain, Canada, Italy, South Korea and Japan will initially contribute over $40 million to the new World Bank fund.

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