Disputes over trade tariffs, Russia overshadow G7 meeting

1

Differences over trade tariff disputes and calls to re-admit Russia have overshadowed a summit in Canada attended by leaders from seven of the world’s wealthiest nations.

US President Donald Trump left the Group of Seven (G7) meeting earlier than other leaders to head to Singapore for a much-anticipated summit with North Korea’s leader Kim Jong-un on June 12.

In a lengthy, wide-ranging press conference before his departure on Saturday, Trump accused foreign countries of treating the US like a “piggy bank” and said tariff-free-trade would be “the ultimate thing”.

“The United States has been taken advantage of for decades and decades,” Trump told reporters on the second and final day of the summit in the Quebec resort town of La Malbaie, reiterating his long-standing view that Washington has been exploited for too long by existing trade arrangements

He said he blamed his White House predecessors going back decades and not the G7 leaders for the “unfair” trade deals.

WATCH

G7: Donald Trump versus the rest of the world

“In fact, I congratulate leaders of other countries for so crazily being able to make these trade deals so good for their countries,” Trump said, while insisting that his relationships with Europe and Canada were “outstanding”.

He vowed, however, to get rid of what he described as “ridiculous and unacceptable” tariffs on US goods.

“It’s going to stop. Or we’ll stop trading with them. And that’s a very profitable answer, if we have to do it,” Trump said. “We’re like the piggy bank that everybody’s robbing – and that ends.”

Later on Saturday, German Chancellor Angela Merkel acknowledged differences between the US and the six other G7 members remained, but said a joint statement on trade was expected to be issued at the end of the two-day summit.

“For us, it was important that we have a commitment for a rule-based trade order, that we continue to fight against protectionism and that we want to reform the World Trade Organization,” Merkel told reporters.

“This is not a detailed solution to our problems. The differences in opinion have not been taken off the table.”

France’s Emmanuel Macron and Germany’s Angela Merkel in La Malbaie [Yves Herman/Reuters]

Collision course

The informal gathering of seven advanced economies is attended annually by leaders from the US, Germany, Japan, Britain, France, Italy and Canada.

But even before this year’s G7 summit began, the USand the other participants were on a collision course on a number of issues.

Is the world on the brink of a trade war?

In advance of his trip to Canada, Trump fired off a provocative proposition by calling for Russia to be readmitted into the G7.

The suggestion was quickly shot down by his European allies, except for Italy.

“Canada’s position is absolutely clear. That there are no grounds whatsoever for bringing Russia with its current behaviour back into the G7,” said Canadian Foreign Minister Chrystia Freeland.

Her words echoed statements from France and Germany, with German Chancellor Angela Merkel saying Russia could not be readmitted until it had made “substantial progress”

Trump ‘confused’

But tensions had already been seething over trade after the Trump administration confirmed on May 31 it would apply additional tariffs on steel and aluminium imports from Canada, Mexico and  European Union   countries, ending a two-month exemption period.

In response, Canada, Mexico and the EU said they were putting in place their own retaliatory measures.

During his press conference on Saturday, Trump warned foreign countries not to retaliate against the US tariffs.

“If they retaliate, they’re making a mistake because, you see, we have a tremendous trade imbalance,” he said

‘G6 plus one’: Frustration with US grows ahead of G7 summit

Trump also played a wild card, suggesting that rather than both sides boosting retaliatory tariffs they could declare for entirely free trade in the G7 zone.

“No tariffs, no barriers. That’s the way it should be. And no subsidies. I even said, ‘no tariffs’!” Trump said. “That would be the ultimate thing, whether or not that works, but I did suggest it.”

The US president’s utopian idea was greeted with scepticism.

“Trump is completely incoherent,” political economist Philippe Legrain told Al Jazeera.

“He is talking about launching a global trade war; he’s taken action against his closest allies; he’s gone through a meeting where it’s six against one – and then blind-sides people by talking about abolishing tariff subsidies and other trade barriers,” said Legrain.

“I think you need to take that with a huge fistful of salt.”

Legrain said it is true that the US has a large trade deficit but added that this was “mostly because Americans consume a lot and produce less”.

Trump “is confused about both the source of the trade deficit and the consequence of the trade deficit,” said Legrain.

“He thinks that it’s due to unfair trade practices but it’s actually primarily due to the consumption behaviour of Americans. He thinks it means that, somehow, America is losing out and actually it doesn’t … The average tariff is almost the same in each country.”

Canada’s Prime Minister Justin Trudeau opens a session on gender equality [Leah Millis/Reuters]

‘G6 + 1’

Another source of disagreement has been the unilateral US withdrawal from a multinational nuclear deal with Iran.

Trump announced the move last month to the dismay of partners in Europe and beyond who were left scrambling to keep the landmark 2015 agreement in place.

READ MORE

G7 Summit: Trade frictions dominate talks

G7 participants were also angered by Trump’s stance on climate change – a key issue on the group’s agenda.

Trump withdrew the US from the Paris climate accord and his attendance of a G7 session on the issue was in question well into the last minute.

Earlier on Saturday, Trump arrived late for a breakfast G7 discussion on gender equality, with summit host, Canadian Prime Minister Justin Trudeau, kicking off things off without waiting for those he described as “stragglers” to arrive.

“Trump came late, he’s leaving early and he gave no ground whatsoever,” Al Jazeera’s John Hendren, reporting from Quebec, said.

“The other leaders have been calling this G6 + 1 because Trump has been so isolated ever since this began, and that’s because he launched an outright attack – that’s in the view of the other members – on the global trading system by raising tariffs on steel and aluminium.”

SOURCE: Al Jazeera