By inviting Volodymyr Zelensky to Hiroshima, the G7 leaders delivered a clear statement to Russia, but they also had China on their thoughts as a potential threat.
According to British Prime Minister Rishi Sunak, China is “increasingly authoritarian at home and abroad” and represents “the greatest challenge of our age” to international peace and prosperity.
The leaders of the wealthiest democracies in the world also communicated to Beijing their positions on contentious subjects like the Indo-Pacific and Taiwan in not one but two declarations. But what they dubbed “economic coercion” was the main focus of their argument.
The G7 has a tricky balancing act to perform. Through trade, their economies have become utterly dependent on China, but Beijing has gotten more competitive, and they have divergent views on several topics, including human rights.
They believe they are currently being held captive.
Beijing hasn’t been reluctant to impose trade restrictions on nations that have angered them in recent years. This includes Australia during a tense time of ties and South Korea when Seoul built a US missile defence system.
When China halted shipments to Lithuania after the Baltic nation permitted Taiwan to establish a de facto embassy there, the European Union became especially concerned.
THEREFORE, the G7’s condemnation of what they regard as a “disturbing rise” in the “weaponization of economic vulnerabilities” is not surprising.
According to them, this coercion aims to “undermine the foreign and domestic policies and positions of G7 members as well as partners worldwide”.
They demanded “de-risking,” a strategy Ms. von der Leyen, who is in attendance at the meeting, has backed. This is moderate version of US’s “decoupling” from China’s proposal, wherein they would use more forceful diplomatic language, diversify their trading partners, and safeguard commerce and technological innovation.
To combat the coercion and collaborate with rising economies, they have also established a “coordination platform”. While the specifics of how this would operate are still unclear, nations are expected to support one another by boosting trade or funding to get around any barriers China may erect.
The G7 also has plans to improve digital infrastructure to deter hacking and technology theft, as well as supply lines for vital products like semiconductors and minerals.
But multilateral export controls will be their biggest hurdle. This entails cooperating to prevent “malicious actors” from using their technologies, especially those utilized in the military and intelligence.
With its prohibition on the export of semiconductors and chip technology to China, which Japan and the Netherlands have joined, the US is already doing this. Despite Beijing’s objections, the G7 is made plain that such efforts would continue and intensify.
Additionally, they said they would keep up their pressure against “inappropriate transfers” of technology acquired through research efforts. People accused of stealing tech secrets for China have been imprisoned because the US and many other nations are concerned about industrial espionage.
The G7 leaders said they wanted to keep the relationship on simultaneously.
In an apparent diplomatic effort to avoid explicitly criticizing Beijing, they avoided mentioning China in a large portion of their statement regarding economic pressure.
When they did discuss China, they did so in a discreet manner.
By claiming that their actions “are not intended to harm China” and that they “do not seek to obstruct China’s economic progress and development,” they attempted to appease Beijing. They were “not decoupling or inwardly turning.”
However, they also pressured the Chinese to cooperate, claiming that a “growing China that plays by international rules would be of global interest”.
They also demanded “candid” engagement, indicating their desire to maintain open lines of contact in a sensitive situation while yet being able to convey their concerns to China.
We must be aware of how Chinese diplomats and leaders will interpret the G7 statement privately. State media, however, has previously retaliated against the West for attempting to have it both ways by criticizing China while still taking advantage of their mutually beneficial economic relationship.
Beijing has continued using its customary irate language in its public discourse.
In the days before the conference, China’s state media and embassies published articles accusing the US of its economic coercion and hypocrisy, showing that it had anticipated the G7’s words.
They complained to the summit’s organizer Japan on Saturday night, accusing the G7 of “smearing and attacking” China.
Additionally, they encouraged the other G7 nations to refrain from “joining in economic coercion” with the US and to “stop banding together to form exclusive blocs” and “containing and bludgeoning other countries.”
It’s important to remember that China has also tried to forge alliances with other nations.
Late last week, right before the G7 conference began, it organized a similar gathering with Central Asian countries.
It must be determined if the G7 proposal will succeed. However, it will be well received by those who have demanded a clear policy to deal with China’s incursions.
Expert on the Indo-Pacific and China Andrew Small complimented the statement, saying it had “the feel of a real consensus” and conveyed the G7’s “centre-ground” viewpoint.
According to Dr Small, a senior transatlantic fellow with the German Marshall Fund think tank, “There are still significant debates playing out around what ‘de-risking’ actually means, how far some of the sensitive technology export restrictions should go, and what sort of collective measures need to be taken against economic coercion.”
But there is now a distinct and explicit framework for how the advanced industrial economies must rebalance their economic relations with China.