The Group of Seven (G7) has sought “constructive” relations with China while criticising its human rights record and territorial claims. The G7 sought collaboration in areas such as climate change while also expressing concerns over Beijing’s growing influence, particularly in the East and South China Seas, and the crackdowns on freedoms in Hong Kong, Tibet, and Xinjiang. The club of wealthy democracies acknowledged the need for “de-risking and diversifying” rather than decoupling from China to ensure economic resilience in the face of their increasing “non-market policies and practices”. China rejected the G7 statement as interference in its internal affairs.
The Ukraine conflict was at the forefront of G7 meetings in Hiroshima, Japan, over the weekend. Ukrainian President Volodymyr Zelenskyy was among the invitees to the meetings, which discussed China's growing dominance and issues affecting the so-called "Global South." Canadian Prime Minister Justin Trudeau expressed the need for a "resilient and diversified" approach to supply chains, while UK Prime Minister Rishi Sunak commented on the summit's significance for consolidating peace. Meanwhile, Japan's Prime Minister Fumio Kishida called for the issue of nuclear weapons to be discussed openly, and said it was "historically significant" for the G7 leaders visiting the Peace Memorial Museum to publish a focus on nuclear disarmament – known as the Hiroshima Vision. The G7 summit heralded a number of warm bilateral meetings, concluding with talks between Ukrainian President Volodymyr Zelenskyy and South Korean President Yoon Suk Yeol on the conflict on Sunday afternoon.
The Group of Seven (G7) summit in Japan has ended, with discussions centring around the Ukraine war, China’s growing dominance and support for the “Global South”. According to a communique, the G7 nations have agreed to support public-private initiatives to swerve China's “belt and road” initiative, to implement measures to counter state-backed “malicious cyber activities”, and to decarbonise energy systems by the end of the century. The G7 also signed a declaration committing to the protection of international maritime regulations, including the peaceful resolution of maritime disputes, navigation rights, and safety along sea lanes. G7 leaders expressed concern over the situation in the East and South China seas. The summit also saw the invitees from Indonesia, South Korea, India and Australia discuss issues such as Ebola, the impact of Brexit, terrorism and trade. President Zelenskyy of Ukraine was in the spotlight throughout the summit.
The G7 summit concluded with a clear message to China, stating that the nation's rise pose the "the greatest challenge of our age". Via two statements, the leaders of the G7 democracies took exception with Beijing's interference in the Indo-Pacific and Taiwan, warned that China could undermine foreign and domestic policies and positions of the group's members, and claimed China was "increasingly authoritarian at home and abroad". They also voiced concern over the "weaponisation" of economic vulnerabilities, but did not propose any specific changes, instead seeking to "de-risk" policy. Beijing lodged a complaint with summit organiser Japan.
Canadian Prime Minister Justin Trudeau has insisted that Russia is to blame for conflict in Ukraine, and said at the G7 Leaders’ Summit: “We will not hesitate to continue to ensure that Russia does not succeed in making might make right once again in this world.” Meanwhile, US President Barack Obama has extended for one more year US sanctions on Russia over its role in the conflict alongside Ukraine. The European Union (EU) is expected to follow Obama’s lead on 1 June when its measures against Moscow come up for renewal.
Canadian Prime Minister Justin Trudeau has praised the “significant military support” of the West in aiding Ukraine against Russian aggression. Speaking after the G7 leaders’ summit in Hiroshima, where he also spoke about the need for nuclear disarmament and the challenge posed by China, Trudeau said: “Russia will not succeed in making might make right once again in this world... We will not hesitate to continue to ensure that Russia does not succeed in making might make right once again in this world.” The US has recently agreed to allow western allies to send US fighter jets to aid the Ukrainian conflict.
Ukrainian President Volodymyr Zelenskyy received positive feedback after his speech and calls for support at the three-day G7 summit last week. US President Joe Biden revealed an additional $375m military aid package for Ukraine, as other G7 leaders committed to further support for Ukraine as it rises above its war-torn past. Japan’s Prime Minister Fumio Kishida also joined to express support by referencing the symbolic importance of hosting the summit in Hiroshima, where the dropping of atomic bombs nearly erased the city and its inhabitants. Japan’s unwavering support for Ukraine — in contrast with other Asian countries who have refrained from condemning Russia’s 2020 invasion — has increased its profile as mediator and gained Kishida domestic popularity. The summit also marked a rare occasion for Indian Prime Minister Narendra Modi to engage with Zelenskyy and address the conflict. Experts highlight the importance of united action against the common challenges posed by China and Russia as member states work to translate their collective policy consensus into action.
The G7 aims to protect critical advanced technologies and diversify supply chains away from China whilst also taking steps to resist economic coercion, US President Joe Biden said. However, he made clear that the world’s seven wealthiest nations were not looking to decouple from China, which is the second-largest economy in the world. Beijing accused the US of unfair practices and real coercion. Biden expressed hope that there will be a thaw in frosty relations with China "shortly". Some G7 leaders sought to strike a more amiable tone; German Chancellor Olaf Scholz said big investments and exports to China will continue as no one had an interest in curbing growth in China.
Last year, when Germany was abruptly cut off from Russian energy supplies, the economy proved it could cope, according to a study by economists. Some economists had predicted a significant loss of economic output and job losses when Russia blocked gas supplies to Germany after invading the Ukraine; however, the country found substitute sources of energy and no business closures or layoffs occurred. The authors also found that temperatures remained the same despite the notion Germany benefited from an unusually mild winter. The report states that Germany's resilience is something to celebrate, and it is important to learn from the experience.
The renminbi has fallen 2% against the dollar in the past month, dropping to RMB7 per dollar, its weakest point since early December. This fall was prompted by warnings from the US Federal Reserve that it may increase domestic interest rates further, and doubts about China's post-Covid economic rebound, fuelled by soft data for April, indicating slow consumer spending and youth unemployment. Analysts expect the onshore renminbi to fall to RMB7.3 per dollar in Q4 and remain at this level for Q1 of 2024. The bank's preferred level is RMB6.5 per dollar to buffer against the adversities caused by fickle global forces.
Chinese air-conditioning company Gree Electric is reportedly closing down its smartphone unit due to low consumer spending on electronics. Gree's smartphone team in the southern tech hub of Shenzhen had reached 100 members at its peak, but the company has now disbanded its core team. The home appliance maker unveiled smartphone ambitions in 2015, aiming to compete with China's popular brands including Oppo, Vivo, Huawei and Xiaomi, but the Chinese smartphone market has experienced continuous headwinds.
The US government's focus on four Mexican individuals known as "Los Chapitos" as the culprits behind the influx of synthetic opioid fentanyl into the country is a convenient distraction from the real causes of the crisis, writes Lisa Tilley in Al Jazeera. As Tilley indicates, over-prescription of opioids and the pharmaceutical industry's irresponsible practices that fuelled the crisis have not been adequately addressed. There has been no reappraisal of the wide-reaching implications of America's capitalist foundations, in which corporate profit is deemed more important than human life. The poorest in society, who are disproportionately affected by the fentanyl crisis, are also the least valued. Additionally, a lack of healthcare, insurance, and secure housing has made at-risk groups more vulnerable to opioid overdoses. Tilley argues that the capitalist superstructure, built on the misery of impoverished communities, is responsible for society's addiction to cheaper painkillers.
Treasury Secretary Dr Steven Kennedy has argued that Australia's increased employment levels could be lost unless unemployment is maintained without increasing inflation. Low inflation is a tricky balancing act as it has a trade-off with low unemployment. The Treasury secretary argued that giving central bankers charge of Australia's economy in the 1980s was asking for inflation to be given priority at the expense of unemployment. Kennedy said near-record low unemployment and near-record participation rates in the labour force are adding to demand and the economy's capacity to supply goods and services. Kennedy also said that getting a higher proportion of the working-age population into jobs (including more full-time roles) improves prospects for economic growth and prosperity. Kennedy warned that full employment was the one thing Australia should aim to maintain as it is a prize that should not be lost.
Attendees of the London Metal Exchange's flagship annual Asian event in Hong Kong reported lacklustre acitivity from the world's top commodity consumer, China. While this would normally occasion caution, attendees were observed to be particularly gloomy given Beijing's tightened political grip and frayed relationship with the West. A lack of recovery, and a weaker-than-expected start to China's peak building season, has so far weighed heavily on hopes around China's ability to bolster copper demand following the Covid-19 pandemic. However, Chinese economy is still expected to grow over 5% this year, and that shows the economy is still resilient.
Pimco has said it sees long-term opportunities in Asia's bond markets following the recent banking sector problems and economic downturn in the US, although geopolitical issues and concerns about moderating growth in China could prove risky. Pimco's Chief Investment Officer, Daniel Ivascyn, said the US economic downturn is not expected to be as severe as the one which followed the global financial crisis, however, setting portfolios up for something worse is still sensible. With China remaining one of the few markets globally without an inflation problem, there is potential for monetary easing as it looks to avoid a slowdown. Ivascyn added that Asia’s bond market would benefit if the Federal Reserve eased monetary policy, as this would spark a rally in the region’s currencies, reducing the cost to fund investments.
A new report published in the journal Science reveals that El Niño, the natural climate pattern that sees ocean water temperatures in the eastern and central Pacific Ocean heat up every three to five years, could cost the global economy trillions of dollars as its effects linger over years. Some of the most intense past El Niño events reportedly cost the global economy more than $4tn over the years that followed. As climate change could increase the frequency and strength of future El Niño events, the report estimates that global economic losses could amount to $84tn by the end of the 21st century, even if carbon emissions pledges to reduce carbon emissions are met. The report found that lower income nations will bear the greatest burden of the costs. This month, forecaster the National Oceanic and Atmospheric Administration revealed strong evidence indicating that intense El Niño activity is expected to occur later in 2023 following record-high ocean temperatures earlier this year.
The Biden administration used the G7 summit in Japan to push the details of a US-led industrial policy around climate, particularly in the global south. This is a new approach, as the traditional Washington consensus model has focused on unfettered growth via deregulation and trade liberalisation. The administration aims to bring a greater coalition of nations into a new economic order, prioritising sustainability and equitable GDP growth, value incentive over capital and limit dangerous concentrations of power in any nation or company. This message was well received by the G7 nations and many others.
FT columnist Rana Foroohar has backed US de-risking rather than decoupling when it comes to China. She said targeting economic chokepoints and concentrations of power that granted monopoly power to nations or private businesses would lessen economic coercion by safeguarding chips, gas, digital data, raw materials, and manufacturing capacity. This allowed for cooler US-China relations while still tackling the core issues. However, she also questioned China's reasons for pursuing tougher espionage rules, which will hinder any foreign business sending digital information across its borders.
India, which chairs this year’s Group of 20 (G20) meetings, has hosted more than 100 such meetings across the country. The G20 was convened in 1999 as an international forum to deal with economic crises. It comprises the European Union and the 19 largest countries in the world, accounting for 85% of global GDP and two-thirds of the global population. This week, New Delhi hosted a tourism meeting in disputed Kashmir, aimed at achieving sustainable development goals in the sector. The meeting drew protests from China and Pakistan. The Himalayan territory is claimed by both India and Pakistan.
Hiroshima's tragic legacy a reminder of potential dangers of today's no-limits technologies
CBC
23-05-22 12:45
Leaders of the G7 nations have urged the adoption of technical standards to maintain trust in artificial intelligence (AI). The development of generative AI, which can create realistic text, has been a source of concern for some who argue it could potentially create realistic-looking so-called "deepfake" videos or other forms of misinformation. Many tech entrepreneurs and AI researchers, including Elon Musk and Apple's head of machine learning, recently called for a pause in generative AI's development, citing potential risks. Politicians have also been increasingly concerned: the EU is on the verge of signing the world's most comprehensive law to regulate AI. Meanwhile, US President Joe Biden has appeared more relaxed, saying it remains to be seen whether AI poses a danger.
