The G7 meeting of finance ministers and central bank governors in Charlevoix, Canada was a hard one for the U.S. Every one of America’s allies battered it for a set of tariffs which may hurt free trade.
The members of the group are the largest developed nations in the world, some of which have been allies since the 19th Century, although some have also been bitter enemies at some point in that time span. They include Japan, Germany, France, the United Kingdom, Italy, and Canada. Canada has been particularity irked recently by the possible breakdown in NAFTA, the North American Free Trade Agreement, which was signed in 1994, and includes Mexico. President Trump argues that the other two countries have used the deal to import goods to the United States in a manner which has undermined job creation, and therefore parts of the economy.
In the Chair’s Summary of the meeting, the U.S. was hit from all sides:
Over two days of discussions, G7 Finance Ministers and Central Bank Governors engaged on a range of topics including the importance of rules-based international trade, and ways of ensuring that economic growth works for everyone.
G7 Finance Ministers and Central Bank Governors agreed that, when they work together, the G7 can build on strong inter-personal and economic relationships to advance our common goals.
Concerns were expressed that the tariffs imposed by the United States on its friends and allies, on the grounds of national security, undermine open trade and confidence in the global economy.
Finance Ministers and Central Bank Governors requested that the United States Secretary of the Treasury communicate their unanimous concern and disappointment.
Since the meeting was widely covered by the media, Treasury Secretary Steven Mnuchin does not have to mention the criticism to President Trump.
Other than the comments on free trade and other measures which could boost the global economy, the G7 showed both worries and facilitation with the rise of crypto-assets. The primary anxiety was about a lack of regulation:
Ministers and Governors discussed crypto-assets. While the associated technologies have the potential to make the financial sector more efficient, crypto-assets may also be used to carry out illicit transactions, and may raise issues of investor protection and market integrity. Ministers and Governors agreed that international coordination is needed to ensure that regulatory actions are effective in a globally interconnected financial system.
The U.S. is in the midst of addressing the problem now by setting up federal regulation of the trading and use, particularly of cryto currencies.
It will only be a matter of weeks before the G7 nations find out how wide and deep the Trump tariffs, which will also hit China, will be.