HIROSHIMA, Japan — Leaders of the Group of Seven advanced economies are generally united in voicing concern about China. The question is how to translate that worry into action.
Over the past two years, President Joe Biden’s administration has sought to reframe the relationship with Beijing and build support among like-minded nations for a strong response to what officials in Washington and some other Western democracies say is “economic coercion.”
But the G-7 also needs to cooperate with China on broader global issues such as climate change, North Korea, the war in Ukraine and the debt problems of a growing number of developing economies. And all the G-7 countries have a big stake in strong ties with the world’s second-largest economy.
At a summit this week in Hiroshima, US officials say they expect leaders of the G-7 to jointly endorse a unified strategy on “economic coercion,” which they define as economic retaliation for policies deemed contrary to another country’s interests, in this case, China’s.
Advisers to Biden have been pushing for this approach since he took office in early 2021. His administration has taken clear actions against China in restricting trade and investment in the name of national security, despite the economic spillovers.
The issue is retaliation against “countries that take actions that China’s not happy with from a geopolitical perspective. That’s a matter that should be of concern to all of us,” Treasury Secretary Janet Yellen said last week at G-7 finance meetings in Niigata, Japan.
“We would like to work jointly with our partners and are continuing our conversations about that,” Yellen said.
Efforts to safeguard economic security would be most effective, she said, with coordinated action, though the US has no interest in breaking up economically with China.
Meanwhile, the European Union also has moved to enact its own platform for dealing with “economic coercion,” an effort spurred by actions taken by President Donald Trump’s “America First” moves against fellow G-7 members.
“While we all have our independent relationships with China, I’m confident that the G-7 leaders will convene on a set of very core shared principles,” EU President Ursula von der Leyen said in a news conference Monday.
Echoing similar comments by Yellen and other US officials, she said the EU’s strategy is aimed at “derisking, not decoupling.”
Yellen says US limits on trade with and investment in China, which are still being worked out, would be “narrowly scoped” and targeted to protect technologies with national security implications. (AP)