G7 offers little to calm markets on growth, debt

Group of Seven finance chiefs pledged on Friday to make a coordinated response to a slowdown in the global economy but offered few specifics and differed in emphasis on Europes debt crisis.The United States pressed Europes strongest economies to give unequivocal financial support to weaker euro zone states to overcome a debt crisis threatening world economic recovery, but Germany stressed the top priority of cutting deficits.In joint terms of reference agreed after hours of talks in the French port city of Marseille, G7 finance ministers and central bankers signaled no shift in policy to try to revive flagging growth.We met at a time of new challenges to ... growth, fiscal deficits and sovereign debt... There are now clear signs of a slowdown in global growth. We are committed to a strong and coordinated response to these challenges, they declared.Given the still fragile nature of the recovery, we must tread the difficult path of achieving fiscal adjustment plans while supporting economic activity, taking into account different national circumstances, they said in an attempt to square reconcile austerity and growth.But the thin statement, which a German government source said was issued at host Frances insistence to try to calm anxious markets, broke no new ground.We have to get away from the idea that there is only one solution for all.... Its not rigor (austerity) versus growth, French Finance Minister Francois Baroin told a news conference.Yet there was a clear difference in tone between U.S. Treasury Secretary Timothy Geithners call for more generous aid for Europes debtors and German Finance Minister Wolfgang Schaeubles emphasis on cutting high deficits.