Competing or collaborating?

Even as the G7 aligns on a common approach to China, competitive industrial policy threatens fragmentation across Western economies

The G7 summit in Hiroshima last weekend was striking for its coherence and bluntness on China.  It was not that long ago that the G7 was an ineffective grouping, writing communiques that were quickly forgotten (or failing even to do that while Mr Trump was in office).  But it has a new lease of life in an era of strategic competition, and particularly since the Russian invasion of Ukraine.

Economic risk & resilience

Beyond the security concerns in Asia and Europe, a key focus of the G7 meeting was on managing the economic risks from China.  The G7 agreed to ‘coordinate our approach to economic resilience and economic security that is based on diversifying and deepening partnerships and de-risking, not de-coupling’. 

Our policy approaches are not designed to harm China nor do we seek to thwart China’s economic progress and development. A growing China that plays by international rules would be of global interest. We are not decoupling or turning inwards. At the same time, we recognize tha…