As leaders prepare for the Hiroshima summit, there seems to be no consensus on how to deal with the risk posed by China.
Tokyo, Japan – All G7 countries agree with the threat of Chinese economic coercion.
But reaching consensus on concrete action to counter Beijing promises to be a challenge for the club of wealthy democracies amid disagreements over how to manage ties to the world’s second-largest economy.
The G7 leaders – Canada, France, Germany, Italy, Japan, the UK and the US – have signaled that China’s use of punitive trade measures will be high on the agenda of their three-day annual summit, which begins in Hiroshima, Japan, on Friday. The leaders of the European Union will also be present.
China’s use of coercive economic measures has been a growing concern in Asia-Pacific and Europe in recent years as Japan, South Korea, Australia and Lithuania have faced trade restrictions after disputes with Beijing over issues ranging from the origins of COVID-19. 19 pandemic in Taiwan.
While the G7 is expected to issue a statement expressing concerns about China’s economic coercion and suggesting ways to work together on the issue, it is unclear how far Japan and European members might be willing to go in measures that could anger Beijing. given their plight. dependence on Chinese trade.
Japan and the European Union consider China their main trading partner. The United States, which has led the global effort to counter Beijing, trades the most with Canada and Mexico, with China third among their biggest partners.
Sayuri Shirai, an economics professor at Keio University in Tokyo, said Japan and Europe may be more cautious than the US about actions that could disrupt trade relations with China.
China’s GDP [gross domestic product] is going to surpass the US in the next decade and have a huge market… Therefore, access to the Chinese market is important for advanced economies,” Shirai told Al Jazeera.
“Japan is in a military alliance with the US, so they may be closer to the US, but they may also need to be careful about their companies’ interest in China, as many companies have made a lot of FDI in China,” Shirai added. .
“Economic NATO”
Some of the loudest calls for coordinated action against China have come from the United States, where President Joe Biden has made opposition to Beijing the centerpiece of his foreign policy.
Earlier this year, Bob Menendez, Democratic chairman of the Senate Foreign Relations Committee, called for the formation of an “economic NATO” in response to economic coercion, military aggression and violations of sovereignty.
Former British Prime Minister Liz Truss also floated the idea of an economic version of NATO in a speech in February in which she urged world leaders to be ready to impose coordinated sanctions on China if it takes aggressive steps against self-ruled Taiwan, which Beijing claims to own.
In March, the EU unveiled an “anti-coercion tool” for member countries that includes a new dispute resolution mechanism and countermeasures such as customs duties and restrictions on public procurement.
China has dismissed accusations that it is weaponizing trade and has accused the US of hypocrisy given its own use of sanctions and export controls.
“If the G7 summit puts ‘resisting economic coercion’ on its agenda, I suggest that they first discuss what the US has done,” Chinese Foreign Ministry spokesman Wang Wenbin told a regular press conference last week.
“China itself is a victim of US economic coercion, and we have always been strongly opposed to economic coercion by other countries.”
Law enforcement is key
Disagreements between the United States and other G7 members on China are not the only disagreements that have arisen ahead of this weekend’s summit.
The Financial Times reported last month that Japan and the EU objected to a US proposal to ban virtually all G7-wide exports to Russia as unrealistic.
However, US officials have been keen to raise expectations that the G7’s stance on economic coercion will go well beyond rhetoric.
On Tuesday, U.S. Ambassador to Japan Rahm Emanuel, who criticized the World Trade Organization’s dispute resolution as slow and urged the U.S. to lead collective action against China’s coercion, told his social media followers to “anticipate action.”
“G7 members are developing tools to deter and protect against China’s economic intimidation and retaliation,” Emanuel tweeted.
Mark Kennedy, director of the Wahba Institute for Strategic Competition at the Wilson Center in Washington, DC, said he expects the G7 to make progress towards coordinated action because of growing awareness of the dangers of over-economic dependence on any one country.
“Europe has witnessed the impact of coercion in its ranks more vividly than the US, most recently in Lithuania, and experienced the pain of overdependence on a single supplier as it weaned itself from dependence on Russian energy,” Kennedy told Al Jazeera.
“The focus on reducing risk through supply chain diversification…by building partnerships with low- and middle-income countries through investment and aid is very unifying. It can also be presented to the Global South as a place for alternative sources.”
However, Henry Gao, a Chinese trade expert at Singapore Management University, said the actual implementation of any coordinated measures would likely be difficult.
“It’s easy to make statements, but enforcement will be a big challenge, especially for Asian countries that have very close economic ties to China,” Gao told Al Jazeera.
“One model that could be useful in this regard is the EU anti-coercion instrument, which shifts decision-making from the country level to the EU level, but this would be very difficult to replicate even at the G7 level, let alone on a global basis.”
