London, UK

[Provisional Translation]

1.Opening Statement
PRIME MINISTER ABE:  Today, May 5th, is a national holiday in Japan, a day on which we wish for the healthy growth of children.
Building a better world for the sake of children, who will lead the next generation, is a duty all politicians share.  Moreover, I believe that the determination to do so is the same for any national leader the world over.

Three weeks from now, the G7 Summit to be held in Ise-Shima, Japan will turn that determination into action.  I intend to make the G7 Ise-Shima Summit a venue for taking a major step forward in joining hands to deal with the various challenges facing the world.  The G7 nations, which share the fundamental values of freedom, democracy, human rights, and the rule of law and have driven world peace and prosperity, have great responsibility in this regard.

One of the major outcomes reaped from my visit to Europe was that I was able to share that sense of mission and sense of responsibility with Prime Minister Cameron, with whom I have just held summit talks, and also President Hollande of France, Prime Minister Renzi of Italy, as well as Chancellor Merkel of Germany.

(The Kumamoto earthquake)

The leaders I met all extended their condolences for those who lost their lives in last month’s earthquakes in Kumamoto and conveyed their sympathy to all those affected by the disaster.

There are many children who regrettably spent this May 5th in gymnasiums where they are under evacuation after losing their homes.  And yet, last week, at the evacuation centers I visited, there were disaster victims who were working hard towards reconstruction, encouraging and assisting each other, with smiles that did not disappear despite their very uncomfortable lives.  In order to live up to their sentiments, currently the national government is also making its utmost efforts for reconstruction measures.

The disaster-stricken areas of Kumamoto and Oita in Kyushu are world-class tourist spots in Japan.  During this trip, I again made an all-out appeal to each national leader I met with, underlining Japan’s attractiveness as an investment destination and as a tourism destination.  In Belgium, thanks to participation by Mayor Hisamoto of Kobe and Mayor Ichihara of Tsukuba, I sent out the message of the appeal of Japan’s local areas.  I would really like for the people of Europe also to come to Japan, and come to Kyushu, during their summer vacation this year.  I would like them to enjoy the rich natural beauty of the area as well as the hot springs there.  I would be truly delighted if people confirmed with their own eyes the reconstruction vigorously underway.

I would like to take this opportunity to extend once again my sincere thanks for the great many expressions of encouragement and heartwarming support for the disaster-stricken areas that have arrived from Europe and indeed from all around the world.  The bonds of friendship that reach beyond national borders are serving as a great source of strength, encouraging the people in the disaster-affected areas tremendously.

(World economy)

In a world where mutual interdependence has deepened to this extent, in the present day we must share various risks, including natural disasters, and face them together.  That is the era we are now poised to enter.

In Belgium, I visited the site where that inhuman act of terrorism occurred.  There I prayed for the repose of the souls of the victims and offered flowers to the deceased.  Violent extremism has now become a major threat to world peace and prosperity.  The response to the refugees surging into Europe from the Middle East is not only a political challenge but also an issue that impacts the world economy tremendously.

In addition to the intensification of these risks, the recent sharp drop in crude oil prices is imparting a major blow to the economies of resource-rich countries and other emerging economies.  Furthermore, against a backdrop of concerns over an economic slowdown in China, with the problems of overcapacity and nonperforming loans being pointed out, since the start of 2016 markets have been fluctuating dramatically worldwide and the unpredictability of the world economy has been rising. 

The downside risks and vulnerability of the global economy are escalating.  The most important topic for the G7 Ise-Shima Summit is how the G7 will be able to cooperate in facing up to such risks.  With the G7 taking the lead, we must set out a path towards sustained and vigorous growth for the world economy and hammer out a powerful message for policy coordination.

What we must do is clear.

We must develop the “three arrows” of Abenomics at the global level once again.

New technological innovations and indeed new added value will arise out of free competition.  We must push ahead with structural reforms and build free and fair markets in which good quality items are evaluated as such.  For these reasons and others, Japan is pressing forward quickly to make the TPP and the Japan-EU EPA into reality.

A large number of experts anticipate a further economic downturn and a slowdown in global demand this year.  Aiming at a stable growth trajectory we will break free from this sluggish state of affairs at a single stroke.  What is strongly required to increase our speed so that we can achieve escape velocity is agile responses in not only monetary but also fiscal policies.　It will also be necessary to further expand investments in high-quality infrastructure and in the field of the environment, centering on emerging economies.

The words of the quintessentially British conservative politician Prime Minister Churchill come to mind:  “I don’t worry about action, but only inaction.”

We must take action before the risks latent in the world economy become actualized and plunge us into crisis.  What is required of us, the G7, at this moment is action.

About a month ago, President Obama of the U.S., Prime Minister Trudeau of Canada and I all agreed on this recognition while in Washington, D.C. I believe that through this visit, I have also become able to hold this recognition in common with my friends in Europe.

(Visit to Russia)

Tomorrow I will visit Russia.

I also wish to build relations with Russia through which we will take on the various issues facing the world.  The constructive engagement of Russia will be indispensable towards the resolution of the Ukraine issue, the situation in Syria, and the North Korea issue as well.  I plan to hold discussions with President Putin regarding a wide range of topics.

An unnatural state of affairs has existed between Japan and Russia for more than 70 years since the end of World War II until the present day, with no peace treaty concluded between us.  The summit talks I will hold with President Putin will be our thirteenth, and this issue is one that cannot be resolved without direct exchanges between us, the leaders.  Working towards our shared goals of resolving the issue of the attribution of the Four Northern Islands and concluding a peace treaty, I intend to hold frank talks in which we speak to each other without reserve.

The people of Japan and Russia, neighboring countries, have cultivated deep-rooted friendships throughout our long history.  I wish to discuss with President Putin the course forward for dispelling the current unnatural state of affairs and for realizing in the economic area and elsewhere the enormous potential within Japan-Russia cooperation.

2. Questions and Answers
REPORTER (HARA, NHK):  You stated that you wish to send out a strong message regarding agile fiscal policies at the G7 Ise-Shima Summit, but I felt there were different degrees of enthusiasm among the leaders of Italy, France, the EU, the UK, and Germany with whom you met during this trip.  How do you regard this point?  And how do you intend to bridge those gaps in how the leaders view this matter?

I would also like to ask about the exchange market.  Within the context of the world economy, the yen has been appreciating as the exchange market fluctuates, and there are concerns about its impact on Japanese companies.  Do you have any plans to discuss the exchange market or examine concrete response measures at the G7 summit?

PRIME MINISTER ABE:  In each of the summit meetings I held during this visit, I conveyed to each leader the fact that the G7 is called upon to have agile fiscal spending together with accelerated structural reforms, in order for the world economy to avoid the risk of falling into a crisis beyond the normal economic cycle as we revitalize the world economy.  I told each leader that is why at the G7 Ise-Shima Summit I wish to send out an even stronger and clearer message as the G7.  I received a solidly encouraging response regarding this point, and I consider this to be a major outcome of the series of summit talks I held during this visit.

That is to say, I was in agreement with each national leader that it is important to press forward with monetary policy, an agile fiscal policy, and structural reform cooperatively, in a balanced manner, reflecting the circumstances of each country.  Prime Minister Renzi of Italy, President Hollande of France, Chancellor Merkel of Germany, Prime Minister Cameron of the UK and I were all concurred with each other on the points I just stated.

We also agreed that at the G7 Ise-Shima Summit the leaders will come together under one roof and deepen our discussions still further and send out a clear, strong message as the G7 on the basis of this common recognition I just shared with you.

As for the exchange market, first of all, I would like to refrain from commenting as the prime minister regarding the exchange rate level and other such matters.  Having said that, I would say that sudden fluctuations in the exchange market are undesirable, as they may have a major impact on for example Japanese companies involved in international trade, among other reasons. 

We are seeing abrupt speculative movement in the exchange market recently.  In the G20 as well, we confirmed our recognition that excessive fluctuations and disorderly movements in the exchange market may cause adverse effects and that exchange rate stability is important.  President Hollande, Chancellor Merkel, and I were in agreement that exchange rate stability is important and that sudden fluctuations are undesirable.  We will keep a careful eye on movement in the exchange market and respond as necessary.

We will engage in wide-reaching discussions on the world economy at the G7 Ise-Shima Summit, and within those discussions, I expect that we will also discuss the exchange rate as necessary.

REPORTER (NARDELLI, BUZZFEED):  Do you think that there is a prospect of any tangible outcomes on issues such as security, Ukraine, and the Middle East, given the current relationship between the G7 and Russia?

PRIME MINISTER ABE:  I think there are issues related to security in addition to what you mentioned as examples just now, namely Syria, terrorism, and refugees, as well as Ukraine.  There are also issues with Russia, as well as South China Sea issues and others.

The G7 is a group of countries sharing the fundamental values of freedom, democracy, human rights, and the rule of law.  We are truly called upon to come together and hold discussions, as well as to send out a message, firmly confronting the issues that I just mentioned.  This is also a duty of the G7.

In that sense, regarding terrorism in particular, we wish to set forth a G7 action plan on counter-terrorism.  I believe the important point is that what is required of us now is for the G7 to demonstrate solidarity as it squarely takes on such issues, to work out solutions for actions that challenge the world order we have built up, and to put forward a prescription for them.  I wish to send out a clear message in this regard at the G7 Ise-Shima Summit.

I said just now that I want to send out a clear, strong message regarding the economy, but I also want to set forth a firm and strong message regarding security, demonstrating the G7’s solidarity.

REPORTER (YAOKA, NIPPON TELEVISION NETWORK):  I would like to ask about the Japan-Russia summit talks to be held tomorrow.  Mr. Prime Minister, while aiming for the resolution of the Northern Territories issue and the conclusion of a peace treaty, you are also in a position to send out a united message from the G7 regarding the Ukraine issue and the Syria issue, in line with what you discussed with the various G7 leaders.  How do you intend to strike a balance between your position as the Prime Minister of Japan and your position as the Chair of the G7 Summit in your summit talks with President Putin tomorrow?

PRIME MINISTER ABE:  Not to have concluded a peace treaty even 70 years since the end of World War II is an unnatural state of affairs.  President Putin and I concur on this recognition.  The Northern Territories issue is one that cannot be resolved except through exchanges between the leaders.  Grounded in the basic policy of resolving the issue of the attribution of the Four Northern Islands and concluding a peace treaty, I intend to hold direct talks with President Putin and tenaciously continue negotiations towards the resolution of the territorial dispute.  Moreover, Japan and Russia have the bilateral relationship with the greatest potential.  Ways of bringing this potential into realization through mutually deepening our cooperation in terms of business, the economy, and our people’s daily lives will also be important.  I intend to hold a dialogue on these and other aspects with President Putin in an unreserved manner.  The conclusion of a peace treaty is necessary to truly make this potential into reality.  I would like to have discussions with President Putin keeping such matters firmly in mind.

I also intend to speak frankly with President Putin about the fact that it is imperative to have Russia’s constructive engagement regarding Syria, ISIL, Ukraine, North Korea, Iran, and other issues.

In addition, as we regard President Putin’s visit to Japan as significant, we will continue to look for an appropriate time for it.

Naturally, with Japan serving in the presidency of the G7, I intend to firmly uphold the G7 framework and the unity of the G7.

REPORTER (MORALES, BLOOMBERG NEWS):  The U.S. recently put Japan on a watch list of countries for currencies that bear monitoring.  I was wondering if you have a reaction to that.  And, if the yen strengthens further, are you prepared to intervene, and would you do so before the G7 Summit?  And finally, a question, if I might:  is a possible “President Trump” someone that Japan can work with constructively?

PRIME MINISTER ABE:  First, with regard to foreign exchange, as I mentioned earlier, sudden fluctuations in the exchange market are undesirable, as they have the potential to greatly affect Japanese companies involved in international trade, among other reasons.  In the recent exchange market, we are seeing abrupt speculative movement.  This is true within the G20 as well, but we have confirmed the recognition that excessive fluctuations and disorderly movements in the exchange market may cause adverse effects and that exchange rate stability is important.  We will continue to watch movement in the exchange market carefully and respond as necessary.

As for the United States’ response, Japan has been designated [for the currency watch list] in view of the fact that Japan enjoys a trade surplus within Japan-U.S. trade.  It is not that we are continually influencing the exchange market.

Regarding the U.S. presidential election, I would like to refrain from making comments on the election itself.  But to comment having said that, as the regional security environment becomes increasingly severe, I consider the Japan-U.S. Alliance, with the Japan-U.S. Security Arrangements at the core, to be the cornerstone for the peace and prosperity of Asia and the Pacific and this will remain unchanging into the future.

Whoever becomes the next president, in the context of the role of the Japan-U.S. Alliance increasing and becoming of greater and greater importance, I intend for us to make efforts to further deepen and reinforce the Japan-U.S. Alliance while we continue to work in close cooperation with the new U.S. administration going forward.  I believe this will contribute to the peace of the Asia-Pacific region.

REPORTER (YOSHINO, TV ASAHI):  The economies of emerging nations and South China Sea issues were also among the topics you discussed in this round of visits.  I believe that these issues will also be topics at the upcoming G7 summit, and I think that all of them are issues connected closely to China as well. 

The autumn G20 meeting will be run by China.  How do you intend to connect these topics to the G20 meeting?

PRIME MINISTER ABE:  Downside risks for the world economy are increasing against a backdrop of concerns about the economic slowdown in China and other emerging economies as well as the plunge in crude oil prices, geopolitical risk, and other concerns.  It is exactly at times like this that the G7 must drive the sustained and vigorous growth of the world economy.

At the G7 Ise-Shima Summit I intend for us to send a clear message out to the world and to connect that to the G20 meeting this autumn.

As for the South China Sea issues, highly substantial discussions were held at the G7 Foreign Ministers’ Meeting in Hiroshima as well.  Free and open seas are also the cornerstone for the prosperity of the international community.  From that perspective, at the G7 Ise-Shima Summit, I expect to see consensus among the national leaders in recognizing the importance of the rule of law and the peaceful settlement of international disputes.

The G20 summit will be held in Hangzhou, China in September, and I would also like to have a Japan-China bilateral summit on the sidelines of the G20 summit in Hangzhou.  The economies of emerging nations and South China Sea issues are both important topics and going forward I would like to urge the constructive engagement of China towards world peace and prosperity, taking the outcomes of the G7 summit as a base.