For all the fanfare around its most recent meeting, the G7 summit in Hiroshima speaks to the group’s struggles to remain relevant and effective in coordinating solutions to major global issues.
The grouping has experienced a steady decline in its share of the global economy over the decades. Its members accounted for about 63 per cent of global gross domestic product when it was founded in 1975, falling to about 52 per cent by the time of the 2008 global financial crisis and reaching 44 per cent in 2021.
G7 nations are also seeing their soft power wane. Non-Western nations are increasingly willing to stand up for their national interests and demand a say in world affairs. More countries are expressing interest in trading with each other in their own currencies.
The Organisation of the Petroleum Exporting Countries and other major oil producers went ahead with surprise cuts to oil production in April despite requests from the United States not to do so. Meanwhile, not many countries from the Global South went along with the West’s sanctions on Russia following its invasion of Ukraine.
As the summit host, Japan might have sensed the waning ability of the G7 to dictate the course of world affairs and invited several non-member countries to Hiroshima. This decision also suggests the diminishing global influence of the Western powers.
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Ukraine’s Zelensky made surprise appearance at Hiroshima G7 summit
Ukraine’s Zelensky made surprise appearance at Hiroshima G7 summit
Moreover, the summit’s failure to seriously address the deficit in funding for global development risks making it appear out of touch with the real world. The grouping did very little in the way of financial aid announcements or addressing any of the top priorities of the Global South, including the US$100 billion in climate finance mobilisation for developing countries the G7 committed to but has yet to provide.
The G7’s expression of concern about debt sustainability in developing countries was an attempt to deflect criticism of its member countries’ increases in interest rates which helped exacerbate the crisis by increasing those poor countries’ debt burden. This was a ploy to avoid taking responsibility while trying to claim the moral high ground.
There are further concerns about the G7’s ability to deliver on its promises given the lack of demonstrable progress in implementing the Partnership for Global Infrastructure and Investment that US President Joe Biden announced last June. If this trend continues, the partnership is likely to suffer the same fate as the Power Africa initiative, which ultimately did little to boost electricity access in sub-Saharan Africa.
Meanwhile, if Western countries’ efforts to “de-risk” economic ties with China succeed, they will only do so at the expense of developing countries. This is just an attempt to maintain Western hegemony by regaining global economic dominance. It is trying to achieve this by reshaping global supply chains in a way that will position G7 countries at the centre of global economic activity and ensure the concentration of high-value added sectors and productive activities in their lands.
If this effort succeeds, it would place developing countries on the periphery of global supply chains and limit them to the production of low-end goods. G7 countries’ attempts to increase their economic security would only result in increasing the Global South’s economic dependence on the West and further marginalise developing countries in the global economy. This is anti-development, not real development.
The G7’s waning importance in the world is also shown in its desire to pursue confrontation with China. Contrary to calls for cooperation between the world’s major powers, the G7 summit featured repeated discussion of the perceived threat from China and pledges to confront China’s rise.
As part of its latest moves against China, the G7 countries called for coordinated action against Beijing’s use of “economic coercion” and other “malign practices”. In fact, it is the G7 countries who are the undisputed champions of economic coercion, actively restricting the imports, exports and investment from their adversaries.
Just on its own, the US has imposed sanctions on dozens of countries, with some measures such as the embargo of Cuba dating back to the 1960s. The rest of the world could be spared enormous carnage and suffering if Washington and its Western allies gave up their flagrant bullying of other countries.
The G7’s confrontational approach towards China could have hugely harmful consequences for the global economy. Nobel Prize-winning economist Joseph Stiglitz has warned that hostile US policies towards China risk making it difficult to deal with pressing global issues. He has suggested other G7 members try to put pressure on the US to be less hostile in its pursuit of strategic competition.
Looking at its agenda, the G7 members’ efforts are clearly preoccupied with serving their own interests. The grouping is an exclusive club of, by and for rich countries which considers itself “the steering committee of the free world”, as Biden’s national security adviser Jake Sullivan has called the G7.
Financial Times commentator Gideon Rachman wrote: “The use of the phrase ‘free world’ is redolent of the cold war and accurately conveys the mood in Washington.” By prioritising its geopolitical goals, the G7 risks turning itself into an economic Nato and becoming a destructive force rather than one for global stability and prosperity.
The G7 leaders have produced a long shopping list that is far beyond the capabilities of their countries. Given the grouping’s irrelevance to the modern world, this summit might as well have been held to give them a place to vent their frustration and anger in public. It is fitting, then, that they met in Japan, the birthplace of karaoke.
Zhou Xiaoming is a senior fellow at the Centre for China and Globalisation in Beijing and a former deputy representative of China’s Permanent Mission to the United Nations Office in Geneva
