Trade ministers from the world’s most advanced economies will seek strategies to make global supply chains more resilient and governments less vulnerable to economic coercion from the likes of China when they gather in Osaka this weekend.
Group of Seven trade ministers convene on Saturday and Sunday against a backdrop of soaring geopolitical risk due to the Middle East and Ukraine conflicts and diplomatic relations frayed by sanctions and trade barriers meant to enhance industrial security. In an indication of the importance of supply chains, the G-7 will hold talks with India, Indonesia, Australia, Chile and Kenya.
The ministers will discuss a wide range of trade-related matters in four different sessions, including measures to address food security, climate change, fair trade rules, economic coercion and supply chain resiliency, according to the trade and foreign ministries of Japan, this year’s G-7 chair. The group plans to issue a statement at the end of the gathering on Sunday.
The group meets as developed nations scramble to bring production closer to home, especially in key areas such as semiconductors and medical devices. Both sectors saw severe supply disruptions during the pandemic, wreaking havoc on the global economy.
The war in Ukraine has created food and energy supply bottlenecks, and the crisis in Israel and Gaza threatens to worsen global polarization as the human toll mounts.
Nations have rolled out trade barriers, sanctions and subsidies to secure their interests with like-minded partners. At the center of those actions are items like chips, which are essential for everything from AI development to weapons making, and critical minerals used in manufacturing batteries for electric vehicles.
Meanwhile, as the global economy takes hits from high inflation in the US and Europe and China’s sluggish post-pandemic recovery, global commerce is expected to grow at less than half the pace predicted six months ago, according to the World Trade Organization.
Source: The Financial Express