G-7 trade chiefs agree to deter economic coercion, eyeing China

Joint statement opens door to develop new tools for fair and free trade

Yasutoshi Nishimura, Japan's trade minister, participated in the Group of Seven online meeting April 4. (Photo courtesy of Japan's Ministry of Economy, Trade and Industry)

ANNA NISHINO, Nikkei staff writer

April 5, 2023 06:33 JST

 

TOKYO -- The trade ministers of the Group of Seven leading industrial nations agreed Tuesday to cooperate on measures to deal with economic coercion such as import-export restrictions and tariff hikes, with an eye on China's outsize role in global trade.

Their online meeting had a goal of ensuring free and fair trade as well as economic security, the first time that the latter was included as an agenda item. After the meeting, Japan's Economy, Trade and Industry Minister Yasutoshi Nishimura told reporters that he wanted to solidify G-7 cooperation. Japan serves as chair of the G-7 this year.

A joint statement released after the meeting refrained from naming countries, but indicated an intention to counter import-export restrictions and tariff hikes, measures that China has taken.

It defined economic coercion as something that "interferes with legitimate choices of another government" and opened the door for G-7 countries to develop new measures to respond jointly.

China increasingly uses its economic clout as a diplomatic card. It restricted imports of coal, wine, barley and more from Australia after that country called for an inquiry into the origins of the coronavirus pandemic.

Lithuania, which has strengthened relations with Taiwan, also was hit with import and export restrictions. In 2010, China cut off exports of vital rare earth minerals to Japan amid tensions over the Senkaku Islands.

The G-7 statement also confirmed that transparency, diversification, security, sustainability, trustworthiness and reliability are essential principles for building and strengthening a stable supply chain.

The statement acknowledged the importance of cooperation with like-minded non-group partners, especially emerging countries, in order to mitigate supply chain disruptions. The sentiment is to be echoed in a May statement from G-7 leaders when they meet in Hiroshima.

The ministers also emphasized the importance of respecting human rights in business activities, and alluded to further cooperation in securing critical minerals.

Russia, a major producer of minerals like nickel and palladium, has destabilized the world's supply through its invasion of Ukraine.

The ministers also agreed on the need to reform the World Trade Organization due to the suspension of its dispute settlement system.

The G-7 trade ministers meeting is usually held twice a year, with a face-to-face gathering slated for Osaka in October.

https://asia.nikkei.com/Economy/Trade/G-7-trade-chiefs-agree-to-deter-economic-coercion-eyeing-China