Can the New G7 Commitments Survive Internal Political Uncertainty?

August 15, 2024

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On June 15, the leaders of the wealthiest countries in the world concluded the three-day 50^th G7 summit in Apulia, Italy, with an official statement that underscored ongoing challenges and aimed to address pressing global issues.

The G7, home to over 776 million people, includes the advanced industrialized economies of Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States, with representatives from the European Union (EU) also attending. It represents around 60% of the global net wealth and about 44% of the global economy, and has been widely viewed as an important constituent of the global governance system and a key contributor to the stability of global economic and financial relations.

This year, G7 leaders held six working sessions focusing on: Africa, climate change, and development; the ongoing situation in the Middle East; Ukraine conflict; migration; "Indo-Pacific" and economic security; and AI, energy, and Africa-Mediterranean.

With the exception of the host, Italian Prime Minister Giorgia Meloni, the other attendees were all politically weakened at home, and many were busy with elections. Despite being haunted by domestic issues, the G7 leaders managed to deliver a strong message of unity concerning matters they believe might affect Western stability, particularly regarding Russia, China, and the Middle East.

G7's Expanding Engagement with the Global South

The G7 attempted to broaden its engagement beyond Western nations by taking some emerging powers on board. Recent years have seen the Global South countries altering world economic and political dynamics, though they do not form a coherent and organized grouping with a leader and a secretariat. Nevertheless, the Global South represents a tangible geopolitical force. As the geopolitical and geoeconomic landscape shifts, the G7's exclusivity clashes with the demands for a bigger say in global affairs from the Global South.

In adjusting to this new paradigm, Italian Prime Minister Giorgia Meloni invited a record number of leaders from countries and international organizations, including Pope Francis and the leaders of Ukraine, India, Brazil, Argentina, Türkiye, the United Arab Emirates (UAE), Kenya, Algeria, Tunisia, Jordan, and Mauritania, for extended sessions. The goal of the expanded guest list, as Meloni said, was to "strengthen its dialogue with nations in the Global South."

Obviously, Prime Minister Meloni aimed to bridge the "West vs. the rest" gap, presenting the G7 as a voice representing more than just the wealthy West.

In the last few years, the G7 governments, led by the Biden administration, have spared no effort in pushing the Global South to join the West in confronting Russia and China. In their eyes, China and Russia intend to change the world order with the aim of diminishing the role of the US and its allies.

Influenced by this mindset, the G7 governments have tried to create what they call an alliance of democracies, dividing the world into two blocs: "democracy and autocracy," with the G7 countries and other nations such as Australia and the Republic of Korea (ROK) on one side, and Russia, China, etc., which are labeled "illiberal," on the other side. This division encompasses not only democracy promotion, but also economics, military cooperation, human rights, and diplomacy.

The G7 summit supported and reaffirmed partnerships with African countries, launching new policies such as the Energy for Growth in Africa initiative, which was expected to contribute to African stability and prosperity. However, these G7 African policies are partially motivated by the desire to counter a rising China. In other words, the G7 seeks to provide Africa with an alternative investor to China.

This strategy is proving futile. Many Global South countries prefer to focus on issue-based cooperation rather than permanent alliances. They do not see any benefits in choosing between so-called "democratic" and "authoritarian" systems of governance. As the G7-China competition intensifies, African countries are struggling to balance their relationships with these global powers.

Whether admitted or not, democracy takes on a wide range of forms based on different countries' political, economic, cultural, religious, and social backgrounds and histories. It can never be said that Western-style democracy or "liberal democracy" is true democracy, and the rest are "fake" democracy or "authoritarianism," even though there are totalitarian regimes amongst this group. Making hasty conclusions leads to wrong decisions.

The world is not black and white. There are quite a few countries that fall somewhere in the middle of that divide. If the G7 ignores the new realities and misinterprets the needs of the Global South, it will be extremely harmful. The Global South countries won't buy into arguments that irrevocably divide the world into two opposing camps, each representing a distinctive way of political ideology.

Take India as an example. In the ongoing Ukraine conflict, both the G7 and Russia want India on their side. It's no secret that both the US and India see each other as natural allies, and the G7 has a clear interest in dragging the world's most populous democracy, India, into what they describe as a "democratic camp" to increase the efficacy of sanctions on Russia.

Unfortunately, there seems to be no way for the G7 to ask India to do more and take on its democratic responsibilities due to divergent interests and strategic concepts. In fact, India plays both sides with great skill. On one hand, being eager to serve as the indispensable bridge between the North and South, East and West, New Delhi is tempted to strengthen relations with the G7, the United States in particular, with an eye on China. On the other hand, India cannot stop buying Russian arms due to its heavy dependence on Soviet-origin weapon systems, which is a thorn in the flesh for Washington.

In addition, there are other conflicts of interest between the G7 and India that are difficult to iron out. For example, when the G7 countries imposed an import ban on Russian-origin diamonds in the 12th round of sanctions against Moscow, it hurt India's domestic diamond export industry, which uses Russian diamonds as raw materials.

Some people in India are not supportive of New Delhi venturing into global power politics at this stage. They argue that India should prioritize uplifting its people above the poverty line and improving governance above everything else. In this context, it is unrealistic to expect India to embrace the G7's demands to stop buying oil or diamonds from Russia, or to impose sanctions on Russia. It's understandable for India to maintain a delicate balance in its relationships with the G7 and Russia.

In the foreseeable future, India won't give up its close historical relations with Russia, unless the United States makes substantial concessions. If bilateral relations between the G7 and Russia deteriorate further or a hot war breaks out in Europe, perhaps the United States will consider loosening the restrictions on the provision of US weapons to India to replace Russian weapons.

Anyhow, it won't be an easy job for India to get access to more sensitive technologies from the US. India will have to fight an uphill battle to convince the US Congress and the US State Department to ease the strict rules governing the export of military technology, such as the International Traffic in Arms Regulations (ITAR). Since the United States is reluctant to share military technology even with its formal allies, it is doubtful that India will be lucky enough to receive such privileges.

The reverse is also true. Up till now, around 40 countries from the Global South have lined up for membership in the BRICS Plus. That does not necessarily mean the BRICS Plus will become a rival or adversary of the G7, because unlike the G7, which comprises "like-minded" democracies, the BRICS Plus countries are diverse with different national interests and distinct political, economic, social, and cultural systems.

Moreover, there are tensions within the BRICS Plus. The tensions between China and India, as well as between Iran and Saudi Arabia, will have negative impacts on the effectiveness of the organization. With an unresolved simmering border dispute between the world's two most populous countries, how can anyone expect India to ally with China to challenge the Western narratives of international affairs?

During the Cold War era, a Non-Aligned Movement emerged. This could occur today as well. As one of the pivotal swing powers in world politics, India is competing with China for influence in the Global South. More likely, India will engage with the G7 countries, trying to portray itself as a bridge between the West and the rest while retaining strategic autonomy to the greatest extent possible.

As a responsible major country, China has a lot to do to make the Global South in general, and the BRICS Plus in particular, more cohesive, coordinate policy with leaders of these countries to democratize international relations, and support and foster the trend toward a more multipolar world, balancing against American hegemonism and unilateralism supported by the G7.

Old Habits Die Hard.

Since the outbreak of the Ukraine conflict, the reconfiguration of international relations has accelerated much faster than expected. In the face of profound changes unseen in a century, the Global South keeps trying to get the voices of rising powers heard in a Western-dominated world, and has been constantly gaining political, strategic, and demographic influence.

Last August, BRICS leaders agreed to invite six countries, namely Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the UAE, to join the group during the annual summit, which The New York Times said had "surprised" some Western countries. The Global South leaders have repeatedly called for "greater representation of emerging markets and developing countries" in international institutions – from the United Nations and its Security Council to the International Monetary Fund (IMF) and the World Bank – seeking to work together toward a more just and inclusive world order.

In spite of the efforts made by the G7 to reach out to the Global South, the gap between the two sides is widening due to the G7's long-standing paternalistic relationship with the developing world, Africa in particular. The G7 regards African nations primarily as recipients of aid instead of fully fledged partners in global affairs.

It seems that G7 governments are eager to deepen collaboration with developing countries on matters of development, food security, energy security, and climate change, to enhance their collective outreach to Africa. At present, there are various aid projects specifically designed for the Global South by the G7, especially those for African countries.

Will G7 governments succeed in galvanizing this West-rest collaboration in the context of the ongoing Ukraine conflict and increased geopolitical competition between the United States and China? It depends on whether the G7 can change its perception and end the "disaster begging bowl" system of international aid. The Global South countries hope to engage with each other on equal terms, treat each other as equals, and be treated as equals. Some African leaders have already expressed fears about double standards in terms of international aid set by the G7.

The old ways of paternalism are no longer effective. Being perceived as dogmatic and sometimes arrogant, the G7 won't get the expected returns if it simply throws money into development aid without a comprehensive paradigm shift. It must be realized that international aid is not an "us vs. them" game, but relates to building a community with a shared future for mankind.

Doubling Down on Efforts to Defeat Russia in the Ukrainian Battlefield

Just one day before the 2024 G7 Summit began, the US announced a new round of sanctions and export control measures, targeting more than 300 individuals and entities in Russia and China, intensifying the pressure on Russia.

During the summit, the Biden administration announced steps to restrict access to certain US software and information technology services, to crack down on the diversion of goods through shell companies, and to more extensively restrict exports to entities that supply Russia with US-branded items produced overseas. Furthermore, on the sidelines of the event, US President Joe Biden and Ukrainian President Volodymyr Zelensky signed a historic 10-year security pact, while a similar deal was signed between Ukraine and Japan.

The summit's most "significant" achievement was the announcement of a plan that drew on earnings from 300 billion USD in frozen Russian assets to provide Ukraine with a 50 billion USD loan to support its efforts in continuing the war against Russia, meeting Kiev's military and reconstruction needs. The G7 leaders reaffirmed their commitment that Russia's sovereign assets within G7 jurisdictions would remain immobilized until "Russia ends its aggression and pays for the damage it has caused to Ukraine."

The new funds will help cover Ukraine's immediate needs. The United States will work with Ukraine and G7 partners in the coming months to work out the details and issue the loan by the end of the year. However, the 50 billion USD loan is essentially a stopgap measure covering Ukraine's current financing gap. If the conflict continues, the West must prepare to make a more sustained financial commitment in the coming years to support Ukraine's defense.

More probable than not, once the conflict ends, more aid will be needed. It cannot be ruled out that the compensation claims for the damages inflicted on Ukraine will exceed the value of the frozen Russian reserves in Europe, which will force the G7 to reconsider whether to seize the 300 billion USD in frozen reserves. Still, perspectives differ as to what strategies their countries should pursue among the G7. There is strong opposition in Europe to confiscating Russian sovereign assets.

The crux of the concerns for European officials is that seizing Russia's sovereign assets would violate international law, weaken the international role of the dollar and the euro, dampen the willingness of countries to hold dollars or euros in their international reserves, and provoke further Russian retaliation against G7 countries, especially those Western firms doing business with Russia or with investments in Russia.

Apart from alleviating Europeans' initial concerns about the adverse effects on the strength of the euro to some extent, the Biden administration was quite successful in convincing other G7 leaders that China is playing an increasingly active role in supporting Russia, which causes direct harm to Europe's security interests, and in exaggerating China's industrial "overcapacity." So far, the G7 governments' attitudes toward China have turned much more assertive, indicating a major shift in their China policies.

In the context of the political right growing as a political force in both Europe and America, the domestic political turmoil in most of the G7 countries could undermine the G7's policy continuity in the next few months. Particularly, the assassination attempt on Donald Trump has worsened a bitter division in America, and will most likely change the landscape of the US presidential election.

This is not good news for the G7. During the first Trump administration, the G7 was effectively paralyzed when then-President Trump disowned the communiqué after it had been agreed on by all other members at the 2018 summit in Quebec, Canada. If Donald Trump were to be reelected, the consequences for the G7 would become very uncertain and would raise doubts over the actual implementation of what had been decided at the Apulia summit. It cannot be ruled out that the G7 will enter a chaotic period of discord and uncertainty after the US presidential election in November. 

 

 

 

Please note: The above contents only represent the views of the author, and do not necessarily represent the views or positions of Taihe Institute.

 

This article is from the July issue of TI Observer (TIO), which focuses on the recently concluded 2024 G7 Summit, examining the global governance dilemmas and domestic political challenges faced by the G7 countries, and discussing their efforts to engage Global South countries. If you are interested in knowing more about the June issue, please click here:

http://en.taiheinstitute.org/UpLoadFile/files/2024/7/31/135526382bbd6aa96-0.pdf

 

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