Tensions among members, already high after public trade disputes, loom large in geopolitical talks

Clockwise from background center, Prime Minister Justin Trudeau sits with President of France Emmanuel Macron, Japanese Prime Minister Shinzo Abe, Italian Prime Minister Giuseppe Conte, President of the European Commission Jean-Claude Juncker, President of the European Council Donald Tusk, British Prime Minister Theresa May, German Chancellor Angela Merkel, and U.S. President Donald Trump as they take part in the Group of Seven industrialized nations summit in Canada, on June 8, 2018.
Clockwise from background center, Prime Minister Justin Trudeau sits with President of France Emmanuel Macron, Japanese Prime Minister Shinzo Abe, Italian Prime Minister Giuseppe Conte, President of the European Commission Jean-Claude Juncker, President of the European Council Donald Tusk, British Prime Minister Theresa May, German Chancellor Angela Merkel, and U.S. President Donald Trump as they take part in the Group of Seven industrialized nations summit in Canada, on June 8, 2018. PHOTO: SEAN KILPATRICK/ASSOCIATED PRESS

President Donald Trump’s suggestion to have Russia rejoin the Group of Seven industrialized nations and his recent imposition of metals tariffs on U.S. allies rattled the start of the G-7 summit, exposing fissures among the group’s members.

The summit is emerging as a test of whether the exclusive group of major industrialized economies can overcome growing tensions to focus on more common-ground issues such as bringing stability to the Korean Peninsula and the Middle East—including the complex question of the Iran nuclear accord.

An afternoon session on the economy and trade was predictable and inconclusive, and saw Mr. Trump pitted against the six other countries, according to a person familiar with the deliberations. There was strong disagreement among the leaders but no significant clash, the person said.

Mr. Trump’s surprising comment ahead of the summit for Russia to be allowed back into the G-7, four years after it was expelled over its annexation of Crimea, added to the uncertainty.

“Why are we having a meeting without Russia?” the president asked as he left the White House for the summit Friday. “We have a world to run…We should have Russia at the negotiating table.”

The comment added another wrinkle to a two-day gathering already rife with tension over U.S. tariffs on steel and aluminum produced by its closest Western allies—and triggered sharply different responses from other G-7 members.

Canadian Foreign Minister Chrystia Freeland told reporters Friday inviting Russia back is a nonstarter: “There are no grounds whatsoever for bringing Russia with its current behavior back into the G-7.” ​

Hot Button IssueTrade plays an increasingly important role in the global economy. And concerns about recent U.S. tariffs willlikely take center stage at the G-7 meeting.Trade as a share of GDP for G-7 countriesSource: World Bank
%U.S.CanadaJapanFranceGermanyU.K.ItalyWorld1970’75’80’85’90’952000’05’10’150255075100

U.K. Prime Minister Theresa May said in an interview with Sky News the G-7 needed to be wary of Russian re-entry.

“Before discussions could begin on any of this, we would have to ensure Russia is amending its ways and taking a different route,” said Mrs. May.

Yet Italy’s new prime minister, Giuseppe Conte, backed Mr. Trump’s suggestion on Friday. “I agree with President Trump: Russia should re-enter the G-8. It’s in everyone’s interests,” he said on Twitter.

Moscow appeared indifferent in its initial response to Mr. Trump’s comment.

“We are concentrating on other formats” apart from the G-7, Kremlin spokesman Dmitry Peskov said, according to Russian state news agencies’ reports.

European Council President Donald Tusk said Friday that it was evident that Mr. Trump and the leaders of other G-7 countries continue to disagree on trade, climate change and the Iran nuclear deal.

“The rules-based international order is being challenged, quite surprisingly, not by the usual suspects, but by its main architect and guarantor, the U.S.,” he said during a briefing in the Quebec resort town of La Malbaie, where the G-7 summit is being held.

A Japanese official said Japan is in sync with the Europeans on trade and is trying to persuade the U.S. to rethink its tariffs, which the Trump administration imposed on national-security grounds.

G-7 leaders posed for the customary family photo during the summit Friday.
G-7 leaders posed for the customary family photo during the summit Friday. PHOTO: /AGENCE FRANCE-PRESSE/GETTY IMAGES

Mr. Tusk said a priority is persuading the U.S. to strengthen the current format of the G-7 as a guarantor of the world order.

John Kirton, head of the University of Toronto’s G-7 research group, said it is for the best that Mr. Trump is at the table talking to America’s longstanding allies.

“It’s much better to talk to him face to face and ask him, ‘What’s on your mind? What do you want? Isn’t there a deal to be done?’” he said.

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Tensions escalated between Mr. Trump and President Emmanuel Macron of France, who until now has been Mr. Trump’s closest ally in the European Union, on Thursday.

Mr. Macron said at a news conference with Canadian Prime Minister Justin Trudeau in Ottawa on Thursday that the U.S.’s steel and aluminum tariffs against the European Union and Canada are pushing the six remaining nations of the G-7 to become a force of their own.

“Maybe Mr. Trump doesn’t mind that he’s being isolated,” Mr. Macron said, “but these six countries have shared values that represent an economic market of true international strength.”

Uneven RecoveryWhile most advanced economies have rebounded from the global economic crisis, some still lag.Change since 2007 in inflation-adjusted GDP among G-7 countriesSource: International Monetary FundNote: Germany’s 2016 data and all 2017 and 2018 data are estimates.
%U.S.CanadaJapanFranceGermanyU.K.Italy2007’08’09’10’11’12’13’14’15’16’17’18-10-505101520

Mr. Trump fired back with a message on Twitter that said, “Please tell Prime Minister Trudeau and President Macron that they are charging the U.S. massive tariffs and create nonmonetary barriers. The EU trade surplus with the U.S. is $151 Billion, and Canada keeps our farmers and others out. Look forward to seeing them tomorrow.”

Eswar Prasad, senior professor of trade policy and economics at Cornell University, said Mr. Trump’s actions and words leading up to and at the G-7 meetings “punctuate his dismissive view of multilateralism.”

“It is remarkable to see the U.S. so isolated amidst a gathering of longstanding allies that have traditionally shared similar economic and political systems and a common set of values,” he said.

Statements from some leaders ahead of the G-7 gathering warned that blunt talk with Mr. Trump would be likely and that the seven countries might fail to agree to a summit-ending communiqué, which would buck tradition.

“We will see where we land,” Ms. Freeland said about plans to issue an agreed-upon communiqué.

A European official said officials are exploring a final statement that would list the countries’ different views, but a failure to agree on a common document is still possible.

Mr. Trump leaves Saturday around mid-morning, before the G-7 tackle issues surrounding climate change, and the protection of coastal communities. The other G-7 leaders will hold press conferences late Saturday afternoon.

This week, Germany showed signs of trying to dial down tensions. Germany is one of the world’s largest exporters, and its economy is highly dependent on trade.

On Wednesday, German Chancellor Angela Merkel pledged to increase Germany’s defense budget in a partial concession to the U.S., which has long objected to Germany’s relatively low military spending.

Mr. Trump had raised the pressure on Berlin in recent weeks by linking the issue to his attempt to rewrite the terms of the U.S.-Europe trade relationship.

Write to Kim Mackrael at kim.mackrael@wsj.com, Paul Vieira at paul.vieira@wsj.com and Rebecca Ballhaus at Rebecca.Ballhaus@wsj.com

COURTESY: WSJ

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