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The G7 leaders committed Friday to increase global funding on migration and refugee challenges, after a two-day summit that also focused on Russia's actions in Ukraine and Chinese claims in the South China Sea.

The group of leading industrialized nations met in the Japanese resort of Ise-Shima to coordinate their response to a range of global challenges and set priorities for the months ahead.

The European Union, which attends G7 meetings by invitation, had pushed for migration to feature on the summit agenda. The bloc was overwhelmed by a surge of more than 1 million migrants reaching Europe last year.

"The G7 recognizes the ongoing large-scale movements of migrants and refugees as a global challenge which requires a global response," the leaders said, adding that they "commit to increase global assistance to meet immediate and longer-term needs of refugees ... as well as their host communities."

They also pledged to enhance legal channels for migration, such as resettlement schemes. However, no concrete figures were put on the table.

The EU is "quite satisfied" with the outcome, a source said on condition of anonymity, while noting that words must now be turned into actions.

Many of those on the move are fleeing conflict in Syria and Iraq.

The leaders pledged to mobilize 3.6 billion dollars in aid for Iraq, aimed in part at countering the causes of migration, according to German Chancellor Angela Merkel. The Islamic State extremist group controls large swathes of the country.

The funding, which is primarily intended to help Iraq address fiscal challenges and carry out economic reforms, includes 500 million euros (560 million dollars) in previously announced German credit, Merkel said.

The leaders also discussed the conflict in eastern Ukraine, where Russia is accused of supporting pro-Moscow separatists.

They remained firm regarding sanctions on Russia, noting that their lifting would be "clearly linked" to the full implementation of a peace deal for eastern Ukraine, and warning that they could be ratcheted up if Moscow fails to do its part.

Attention also turned to tensions in Japan's neighbourhood, notably Chinese claims in the South China Sea, a key shipping lane believed to be rich in natural resources that is also claimed by five neighbouring countries.

Without naming China, the leaders called for a "rules-based maritime order" and warned against "unilateral actions which could increase tensions" as well as the use of force or coercion.

Similar language by the G7 foreign ministers last month drew a sharp response from Beijing, while on Thursday a Chinese Foreign Ministry spokeswoman warned the leaders against "meddling" in the affairs of another country.

Global economic instability was the official headline topic, with the summit host, Japanese President Shinzo Abe, seeking backing for his domestic efforts to boost Japan's languishing economy with fiscal stimulus. Germany in particular is opposed to the approach.

The joint text on how best to boost the economy proved the most contentious, the EU source said. The G7 finally agreed to "reaffirm the important role of mutually reinforcing fiscal, monetary and structural policies."

"It means that 'Abenomics' will be deployed globally going forward," the Japanese premier said, referring to his policy approach. German Chancellor Angela Merkel, meanwhile, insisted that the joint text also mention "efforts to put debt on a sustainable path."

The leaders weighed in on Britain's upcoming referendum on EU membership, warning of the risks of Brexit, or departure from the European Union, on the global economy.

"A UK exit from the EU would reverse the trend towards greater global trade and investment, and the jobs they create, and is a further serious risk to growth," their statement says.

"I think we should listen to our friends, we should listen to people who want us to do well," British Prime Minister David Cameron later said.

The G7 comprises Britain, Canada, France, Germany, Italy, Japan and the United States, while the EU is also at the table.

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