Banff (Canada) (AFP) – Top finance leaders from the G7 nations gathered in Canada starting Tuesday, in talks set to be clouded by economic worries stemming from US President Donald Trump’s tariffs, while concerns about Ukraine remain at the fore. In meetings through Thursday, leaders will discuss global economic conditions, with participants seeking a common position on Ukraine, while issues like financial crime and non-market practices are also on the agenda. The talks come amid an uncertain approach among G7 democracies towards war in Ukraine — after Russia’s invasion in 2022 — since Trump returned to the presidency this year.
Ukrainian Finance Minister Sergii Marchenko is present as well at the meeting of Group of Seven finance ministers and central bank governors in Canada’s western province of Alberta, and will address reporters Tuesday. Once broadly unified, the G7 — Britain, Canada, France, Germany, Italy, Japan, and the United States — has been rattled by Trump, who reached out to Russia and slapped tariffs on both allies and competitors. Economists warn tariffs could fuel inflation and weigh on growth, and the effects of US trade policy will loom over Treasury Secretary Scott Bessent’s engagements.
While Trump’s levies are not formally on the agenda, a Canadian official told reporters that “trade and tariffs will be embedded in the discussion on the global economy.” The official expressed hope for the G7 to reaffirm support for a well-functioning trade and investment system. A US Treasury spokesperson meanwhile said Bessent seeks to get the grouping “back to basics and focused on addressing imbalances and non-market practices,” including in non-G7 countries. G7 members could find more consensus on China. A source briefed on US participation expects China’s excess industrial capacity to be discussed, with members sharing concerns on the issue.
A Japanese official told AFP its finance minister plans for a meeting with Bessent, seeking to address topics like foreign exchange. But there is currently no bilateral meeting scheduled between Bessent and his Canadian counterpart Francois-Philippe Champagne. While the grouping discusses policies and solutions to issues like trade, security, and climate change, analysts warned of unpredictability this time amid internal tensions.
– ‘A test’ –
The Banff, Alberta gathering will be “a test or signal” of the G7’s ability to agree on a final statement, a French finance ministry official told reporters Tuesday. Although Canada’s presidency hopes to issue a communique, this outcome must reflect “a shared understanding of the global economic situation and common goals in addressing the challenges outlined in the statement,” the official said. “We will not be able to accept language that is completely watered down.”
The source briefed on US participation said Washington is not inclined to “do a communique just for the sake of doing a communique,” noting a consensus should align with Trump administration priorities too. German Finance Minister Lars Klingbeil warned Tuesday that trade disputes with the United States should be resolved as soon as possible. In comments before meeting his counterparts, Klingbeil said tariffs and uncertainties are a burden on the economy and job security. Trump has slapped a blanket 10 percent tariff on most US trading partners, threatening higher rates on economies including the European Union and sending jitters through the world economy.
He has also imposed tariffs on imports like steel and aluminum, raising the temperature with G7 countries. “A possible metric for success is that the US wants to engage and negotiate a trade deal,” said Ananya Kumar, a deputy director at Washington-based think tank the Atlantic Council. Officials told AFP they are not expecting trade agreements this week, but said the gathering is another chance to find common ground. Trying to progress on trade will help with other issues, said Kumar. She expects members to also seek “commitment towards the status quo with Ukraine.”
The issue of sanctions on Russia remains uncertain. Trump said Russia and Ukraine would start peace talks after he spoke Monday with Russian President Vladimir Putin, while the EU formally adopted a new round of Russia sanctions Tuesday. A source briefed on US participation maintained that all options remain regarding sanctions, but these should be aimed at outcomes like the peace process.
© 2024 AFP
