Is the G7... back?

There’s an interesting air of elation mixed with relief coming from the French town of Évian-les-Bains, where G7 leaders just wrapped their annual summit. Reminder, that’s the annual meeting of seven major advanced economies (🇺🇸🇨🇦🇬🇧🇫🇷🇩🇪🇮🇹🇯🇵).

Why so happy? Let’s find out, in their own words. 

“This G7 is objectively a success” - French President, Emmanuel Macron

There’s nothing surprising about a world leader who literally claimed his thoughts were “too complex” for journalists, also immediately declaring his own summit a success.

But in this year of our Lord, it’s genuinely impressive that nothing at this G7 went wrong! No public tongue-lashing, no mid-summit walk-out, no viral Trump vs the World pic (though this ‘Trump alone’ pic has done the rounds).

In fact, the group even managed to find enough common ground to issue joint communiques covering spicy topics like Ukraine, the Middle East, and the Indo-Pacific!

As the sole German in the friends group (Chancellor Merz) put it, characteristically bluntly, “this is ​the first ‌time ‌since president Trump took office ‌that we have issued a joint declaration at a G7 summit and found common language on ‌the major foreign and security policy issues of ​our time.” Trump himself agreed, noting “we found a great deal of unity”. 

“We commend Ukraine for its resilience and progress on the battlefield in recent months and emphasize there is now a new momentum.” - G7 statement on geopolitical issues

That’s a huge vibe shift from last year, when the G7 couldn’t even jointly utter the word ‘Ukraine’ amid strong Trump 2.0 pushback, which was ostensibly to protect the peace talks.

Why this vibe shift? It’s thanks partly to Ukraine itself, rapidly developing and deploying its own long-range missile and drone capability that’s now fried so much of Putin’s energy infrastructure, he’s now having to import seaborne gasoline from Asia!

Drone tech has also helped Ukraine rebrand as more of a free world asset than liability.

And maybe the White House is also processing the notion that Putin was only ever using those peace talks to distract and divide the West while continuing his attacks.

But does a G7 vibe shift really matter? Well yes in the sense that…

• These key economies no longer see backing Ukraine’s self-defence as a lost cause

• They’ve instead vowed to boost support while baking more Russia sanctions, and

• Trump himself is also now pressuring Putin (not Zelensky) to make a deal, while hinting he might soon reimpose the Russia sanctions he waived amid Iran.

“Reducing global imbalances could facilitate achieving more durable and balanced growth.” - Leaders’ statement on resilient growth 

This year, the G7 also pumped out a statement dedicated to “a more balanced, durable, resilient growth”. Translation? It repeats the word ‘imbalances’ 13 times (!), so it’s really all about China, whose epic overcapacity continues to rattle and divide the G7.

• It rattles because no G7 factory can compete with China’s subsidised tsunami, and

• It divides because the pain — and urgency to push back — hits Europe unevenly.

So… does this G7 statement solve that problem? No, but it’s still a big step, adding public momentum to what’s now emerging in private: rather than keep getting picked off alone via China’s threats to tariff cognac, cars, or whatever else, Germany is now reportedly backing France’s push for more of a US-style joint tariff and quota wall. That might enable the survival — and diversification — of Europe’s industrial base.

“We aim to significantly reduce our dependencies on a single supplier outside the G7 and partner countries for rare earths and permanent magnets to under 60 per cent by 2030” - Leaders’ declaration on critical minerals 

Amid China’s quasi-monopoly over the supply of the critical minerals we need for energy, defence, tech, and beyond (leverage China has now flexed on several occasions), this G7 response is pretty remarkable. Sure, it pledges some familiar answers on the supply side: think more mines, plants, recycling, stockpiles, and diversification.

But it also pledges some big stuff on the demand side, flagging a willingness to actively tilt demand towards diversified and recycled supply, rather than just hoping the market sorts it out — it’s this that theoretically generates guaranteed offtake, the single biggest thing new mines and plants really need before they can get off the drawing board.

Sound even smarter:

• No global summit is complete without some spicy hot-mic moments. Our faves this year have included the WHO chief congratulating Italy’s Meloni for kicking her smoking habit; Brazil’s Lula flaming his FM for arriving early; and Meloni’s young daughter stealing the spotlight by actively avoiding it.