In a recent meeting held at Borgo Egnazia, Italy, the Group of Seven (G7) leaders are contemplating additional measures to address the trade imbalance with China and safeguard their economic interests. According to a senior U.S. official, there is an expectation of unprecedented unity among the G7 nations in confronting China’s non-market policies and practices.
The U.S. official mentioned that China has been operating on unequal terms for an extended period, engaging in unfair and anti-competitive economic behavior. Washington asserts that China’s policies and subsidies have led to global spillovers and excessive overcapacity that harms businesses outside China. This situation has also resulted in supply chain dependencies in various sectors like solar energy, wind power, electric vehicles, lithium-ion batteries, medical devices, mature-node semiconductors, and steel.
To counteract this challenge, the U.S. and its G7 counterparts, including Britain, Canada, Germany, France, Italy, Japan, and the European Union, are focusing on developing diversified supply chains and promoting more resilient economies. Some steps have already been taken, such as the implementation of increased tariffs on specific sectors like electric vehicles by both the U.S. and the European Union.
While the exact details of the additional measures under consideration by the G7 leaders remain undisclosed, it is evident that China’s practices have reverberating effects on international partners across the globe, affecting a wide range of economies from advanced to developing countries. The U.S. official emphasized the importance of unified action within the G7 to denounce harmful practices and commit to a collaborative response.
The U.S. official clarified that the objective is not to stifle China’s economic progress but to ensure a level playing field and protect American workers from unjust practices by China. This stance reaffirms the commitment of the G7 nations to uphold fairness and integrity in international trade relations.
The deliberations among G7 leaders underscore the pressing need for concerted efforts to address the challenges posed by China’s non-market policies. By fostering unity and cooperation, the G7 aims to establish a more equitable global trade environment that safeguards economic security and promotes fair competition.