G7 Summit 2019: The super-rich countries fight against inequality they themselves created
25 August 2019
The 45th Summit of the seven richest capitalist countries, known as the Group of Seven or G7, opened in the south-western French city of Biarritz, in the French Basque Country, on 24 August. Presided over by the French president Emmanuel Macron, this year’s focus is on fighting global inequality. The host country of the summit normally takes the leadership in setting the objectives. The G7 is composed of Canada, France, Germany, Italy, Japan, the UK and the US. Represented jointly by the president of the European Council and the president of the European Commission, the EU participates in all discussions as a guest.
Their discussions on fighting inequalities cover an ambitious scope spanning broad aspects of the theme. It includes inequalities produced by huge imbalances in people’s access to opportunities; a healthy environment; social benefits of globalisation; security threats and terrorism; and digital technology and artificial intelligence. In addition, there are also concerns over Brexit, China, Russia and Iran.
A summit on inequality by the heads of governments of countries that are considered by many as creators of global inequality and benefiting from inequality may be too absurd. Setting this aside, however, it will also be too optimistic to think that there will be agreements on issues where there are huge differences to overcome.
To prevent the possibility of the 2018 G7 summit’s crisis caused by US president Donald Trump’s withdrawal of support for the 2018 summit communique and accusation of back-stabbing against host country Canada’s prime minister Justin Trudeau, French president Emmanuel Macron decided not to have a communique at this year’s summit. This is the first time that there will be no such document since the group started originally as Group of Five in 1975.
Trade wars amidst impending global recession
Europe, Japan and the US, despite Trump’s optimism about the state of his country’s economy, are experiencing a slowdown in economic activity and industrial production. This was also the conclusion at the meeting of central bankers, leading academics and representatives of international organisations from around the world in Jackson Hole, Wyoming last week. It is no longer a question of ‘if’ but ‘when’ the next crisis will occur. The more important question of course is how far will it go? It took more than 10 years for the major economies to recover from the 2008 crisis. Now that the global economy is more integrated, a crisis like 2008 will be bigger, will hurt more and affect more people.
Prior to the G7 meeting last year, Trump accused his co-attendees of abusing his country and of treating the US as a piggy-bank for allies. He imposed tariffs on their exported goods to the US. Hours before this year’s summit, he announced measures that will further escalate the trade war between the US and trade partners.
In retaliation to the US’s new round of tariffs planned for December, China announced a round of tariffs on $75 billion (£61bn) worth of US goods. In reaction, Trump immediately announced that he was going to hike the rates on his existing tariffs on $250bn of Chinese goods and impose 10% more tariffs on another $300bn of imports. He also ordered US companies to quit China. The China-US trade war is seen by European leaders as a contributing factor to their economic problems. These latest salvos in the trade war sent financial markets all over the world tumbling.
Climate change and security issues
Trump also called for the G7 to re-admit Russia, which was ejected from the group after its annexation of Crimea in 2014. In a call between Trump and Macron, the latter agreed that President Vladimir Putin should be invited to the summit when it is held in the United States in 2020.
Another sticky issue is the US withdrawal from the Iran Nuclear Deal, an agreement concluded in Iran in July 2015 between Iran, China, France, Germany, Russia, the United Kingdom, the US, and the European Union. It provided that Iran’s nuclear activities would be limited in exchange for reduced sanctions. In the lead-up to the summit, Macron held discussions with Iranian foreign minister Mohammad Javad Zarif in an effort to save the deal. If the US does not come back to the deal, the European countries that are party to it will need to decide about the future of the agreement. The deal is not just an agreement between the parties involved, but backed by a UN Security Council resolution.
Another area of disagreement between Trump and other G7 leaders is on climate change. Trump created the major difference when he pulled the US out of the Paris climate accord and he did not attend a meeting to discuss the issue at the G7 2018 meeting in Canada.
Counter-summit and protests
President Macron hosted a “day of dialogue” with civil society representatives in Paris a day before the summit, to address issues such as equality between men and women and climate change. NGOs including Climate Action Network, Greenpeace and Oxfam have decided to boycott the summit to protest the presidency’s decision to limit the number of accreditations to 25 slots.
In Biarritz, more than 13,200 police officers have been deployed to protect the summit, transforming the whole city into a fortress. France’s Interior Ministry warned of the threat of “outbreaks” of violence, citing the examples of protests in Prague in 2000; Genoa, Italy, in 2001, Rostock, Germany, in 2007; and London in 2009.
Anti-globalisation and climate activists called for a Counter-G7 mobilisation in Hendaye, which is in the southern part of Biarritz and near the Franco-Spanish border. They organised workshops, discussions and protest actions attended by thousands of activists already camped there two days before the summit. They were joined by the French Yellow-Vest protesters and members from Basque nationalist groups.
Activists view the discussions on inequality as lip service. According to ATTAC France activists, “it is the height of irony that the G7 countries, after imposing neoliberalism, which has led to damaging inequalities and some irreversible environmental impacts from which the countries in the global South will find it difficult to recover, are now championing the fight against inequality”. Organisers say that the Counter-G7 was organised to offer radical solutions as a response to the summit of G7 leaders.
Peaceful marches were planned in Hendaye and Irun for Saturday, coinciding with the opening of the summit. The Yellow Vest protesters took part in a bloc, as their 41st Saturday protest, while Basque nationalists also formed a bloc.
The Basque region of France has long been associated with resistance, with people there calling for autonomy. They have a unique language and culture. There are lots of community-led innovative programs that were set up, owned and managed collectively by local organisations. In recent decades, an alternative economy has been created, including the use of the Eusko currency. Like other micro-currencies around the world, the Eusko was created with the aim of boosting the local economy by encouraging custom for neighbourhood businesses. There is also a renewable energy network in the region that is managing its own renewable energy.
Photo: White House