Is China in Their Sights?
May 20, 2023 | Expert Insights
From 19 to 21 May, Japan as the current G7 president, will host the 49th G7 Summit at Hiroshima. As the war in Ukraine touches the threshold of serious nuclear sabre rattling, the choice of location could not have been more significant. This exclusive club of France, the U.S., the UK, Germany, Japan, Italy and Canada represents the hardcore of the 'Democratic Liberal West', which today faces the most serious challenge from a 'Russian -China Axis'.
Unsurprisingly, the presser on the G7 summit placed on the internet by the Japanese Foreign Ministry reflects this concern. It states that “the international community is now at a historic turning point, having experienced the COVID-19 pandemic and being faced with Russia’s aggression against Ukraine, which has shaken the very foundation of the international order. Therefore, the perspective of the G7 would be to uphold the international order based on the rule of law, firmly rejecting any unilateral attempt to change the status quo by force or the threat to use nuclear weapons, as Russia has done."
The issues to be discussed in the G7 are the ones that are on the front page of every newspaper these days.
As mentioned earlier, Ukraine will figure prominently as all the G7 members have vigorously endorsed the sanctions regime, whatever may be the cost to their respective economies.
As a message to the other pole of the opposing axis-China- the G7 will ‘reaffirm and strengthen cooperation on the free and open Indo -Pacific.” This should please India.
Japan has been a leading advocate of denuclearisation of the world, and towards that aspect, discussion on Nuclear Disarmament and Non-proliferation were expected during the conference. Hopefully, the G7 will be able to come to some 'realistic and practical efforts' to take the world away from the 'reality of the harsh security environment' to the 'ideal world without nuclear weapons,' a utopian world by any count but not entirely unachievable!
Of greater interest to the rest of the world is the promise of considering the woes of the Global South with ‘greater deliberations and efforts.’ In this sphere, the G7 promises to work on issues related to resilient supply chains, non-market policies and practices and economic coercion, of which the G7 itself is a great practitioner.
The Ukraine war has choked global food supplies, and the poor are its biggest victim. With the war in its 15th month, there seems to be no let-up in the global grain supply, with next year's harvests equally seriously jeopardised. To this end, the G7 has promised to ‘identify structural vulnerabilities in the global food system and set pathways to overcome them, while addressing pressing food issues in the short term’.
Climate and Energy always surface in any agenda of any high-power meeting nowadays, and it will also figure at the G7 summit. However, it too will have a geopolitical angle as dependence on Russian oil and gas will definitely be on the table and measures, short and long term, how to get out of the 'oil trap'.
G7 Leaders aim to “de-risk” essential supply chains, such as those of critical raw materials, by diversifying away from China. This aims to ease China’s influence, as they fear dependency on China would allow China greater success with attempts at economic coercion, such as those made targeting Japan, Lithuania and Australia in the past post various disputes with Beijing on a variety of issues, ranging from the Covid-19 pandemic to Taiwan. The European Commission president is on record clarifying, “We seek a multifaceted approach to our economic relations with China.” Adding, “It is characterised by de-risking, not decoupling.”
These fears are all too real to the EU members of the G7, who recently experienced the consequences of being overly dependent on a singular economy, as they must move away from their reliance on Russian energy.
China shouts hypocrisy at accusations of using trade as a weapon. "If the G7 summit puts 'countering economic coercion' on its agenda, I suggest that they should first discuss what the U.S. has done,” Chinese Foreign Ministry spokesperson Wang Wenbin told a regular press conference last week.
The movement to combat Beijing's growing power has been led by the United States, with Washington taking an aggressive approach - blocking China's access to the most advanced semiconductors and the equipment to make them - but it is unclear how far Japan and EU will be willing to go to support this motion, as China stands as the largest trade partner for both economies.
The European G7 members are disgruntled by China's unwillingness to reciprocate the openness of the EU market and the relative lack of Chinese investment in their economies, despite having signed cooperation agreements. They hope to gain greater economic benefits from China by establishing a more level playing field, which member states believe can only be achieved by reducing dependency, using the EU's market power more assertively, and showing a greater willingness to participate in geo-economic confrontations.
The economic concerns of the G7 regarding China are accompanied by political ones as well.
The member states are uneasy about China's increasingly brash ability to dominate bilateral agreements as well as China’s violations of human rights and international commitments in places like Xinjiang and Hong Kong.
Meanwhile, in the East, Japan has become increasingly serious in regard to the Chinese military threat they face, outlining their plan to increase military budgets and improve their ability to defend against and dissuade potential enemies. This will certainly be discussed among the G7 leaders to thwart any fears of the reincarnation of a militarised Japan.
Neighbouring China, Japan holds the highest stakes in the discussion to be held at this G7 summit in regard to maintaining the peace across the Taiwan Strait, which lies merely a few hundred kilometres away from Japan, as China’s territorial ambitions turning violent here would certainly have an immediate impact on Japanese security.
Japan has also invited several regional partners to join G7 leaders at this summit, including leaders from the Quad, as well as South Korea and Vietnam. This is vital to the efforts of the G7 to win over important "middle-ground" countries in what they are calling a global "battle of offers" with Beijing and Moscow.
This involves increased and improved coordination between G7 leaders and these countries on existing infrastructure projects, high-level engagements, and bespoke action plans for every economy identified as a key partner in this programme's objectives.
The programme is a recognition of how China's provision of infrastructure investment and Russia's supply of weapons, nuclear -energy technology and fertilisers is winning over more countries than Western appeals. It is believed the two countries are using such economic assistance and anti-west messaging to create inroads.
Middle-ground countries have begun to realise that the dramatic developments in recent years have resulted in Western powers losing the leverage they once held, reducing their ability to pressure developing countries politically and economically.
U.S. Assistant Secretary of State for Western Hemisphere affairs, Brian Nichols, stated, "It's important that we give countries in our hemisphere and around the world options," and that the U.S. needs to provide countries with "a clear perspective and vision on what they can do to have successful economies" also stating that countries like China are not delivering on some of the promises they make.
- The G7 faces numerous and varying hurdles, most stemming from the fact that China is a major trading partner for a number of economies, and its GDP is set to overtake that of the U.S. in the next decade, making it important for advanced economies to have access to its market.
- India will likely back the Quad security alliance with the US, Japan and Australia if it must choose between the West and China, but its security and foreign policy establishment remains suspicious of the U.S.
- While it may benefit from diversifying from China, Vietnam cannot afford to turn a blind eye to its top trading partner, right over the border.