With growth slowing and families struggling to make ends meet, it is an appalling injustice when money ends up in the hands of criminals – money that could be spent on much-needed global growth and development” // MARK SOBEL Mark Sobel is US chair at the Official Monetary and Financial Institutions Forum. He represented the United States on the International Monetary Fund executive board between 2015 and 2018, and was deputy assistant secretary for international monetary and financial policy at the US Treasury between 2000 and 2015. He helped lead Treasury preparations for meetings of G7 and G20 finance ministers and central bank governors, formulated US positions at the IMF, and coordinated Treasury and regulatory agencies’ work in the Financial Stability Board. He played a key role in US foreign exchange policy, including coordinating the Treasury’s semi-annual foreign exchange report on China and other countries.
X-TWITTER @sobel_mark omfif.org
readmitted to the G7, despite its barbaric war against Ukraine and Putin’s dicta- torship. Other G7 leaders have rejected Trump’s mistaken call. Trump has shown utter disregard for Ukraine, even denying that Russia was the aggressor against Ukraine, notwith- standing the rest of the G7’s steadfast strong support. His berating of Ukrain- ian president Volodymyr Zelenskyy, supported by US vice-president JD Vance, sent chills up the backs of European lead- ers and was quickly rebuffed by them. Trump has turned America’s policies on climate change on their head, while Europe continues to do its best to forge ahead. European officials have reservations about trusting and working with Trump’s intelligence team. Moreover, Trump’s deprecations and disdain for Canadian sovereignty will only exacerbate the underlying tensions surrounding the Kananaskis Summit. The foundations supporting the west- ern alliance, NATO, liberal trade and the G7 – and, frankly, American global leadership – are being torn asun- der by the current US administration. Whatever the status of these issues at Kananaskis, enormous damage has been done. The G7 Kananaskis Summit may be a frigid affair, even if it is warm and sunny outside.
statecraft, including the first Trump administration’s pursuit of a more pro- tectionist and isolationist course. A REINVIGORATED ROLE FOR THE G7 As the G20 stumbled, the G7 gath- ered renewed momentum. It was not a smooth ride, as epitomised by the strained US relations with the rest of the G7 at the 2018 Charlevoix Summit, when Trump shamefully disavowed the com- muniqué to which all had just agreed and launched verbal attacks on the summit’s host, Canadian prime minis- ter Justin Trudeau. The administration of US presi- dent Joe Biden, however, helped revive the G7 as a cohesive, democratically aligned forum. The G7 rolled out sanc- tions on Russia, including blocking $300 billion in Russian central bank and oli- garch assets. It helped raise support for Ukraine, including by transferring pro- ceeds from Russia’s immobilised assets, although unfortunately failing to seize and send all those Russian holdings to Ukraine. The G7 limited Russian energy revenues, including imposing a price cap on Russia’s oil exports. Members worked together on tackling cybersecu- rity, which would not have been feasible by the G20 given the presence of Russia and China. The G7 adopted a hardened line against China’s challenge to west- ern security. All this cohesion, trust and unity are unravelling as the Kananaskis Summit approaches. US relations with its long- time allies in Europe have become highly strained. Donald Trump is tearing apart the glue that holds the G7 together and it now faces the question of whether it can even continue, or function properly at least over the next four years while Trump is president. It is hard to reach a positive answer for several reasons.
Trump’s attacks on the European Union, claiming that the EU was formed to ‘screw’ America, fly in the face of transatlantic unity and basic comity, and America’s longstanding support for the EU. His tariff threats undermine the liberal trade policies that promoted dec- ades of transatlantic prosperity. He is right in arguing that Europe must do more for itself, especially on defence. But shunning America’s closest democratic allies while embracing Rus- sian president Vladimir Putin and other authoritarian leaders undermines the cohesion underpinning the G7’s revival. German chancellor Friedrich Merz, always an ardent pro-Atlanticist, shock- ingly said that his absolute priority will be to strengthen Europe as quickly as possible in order to achieve independ- ence from the US, because Americans under this administration are clearly indifferent to the fate of Europe. Other European leaders have echoed his star- tling remarks. AVOIDING A FRAGMENTED FUTURE Trump seemingly wishes to abandon the North Atlantic Treaty Organization, or disregard its responsibilities. He appears to see little value or have any interest in the G7 as a ‘democracy’ club, given his support for authoritarians. Indeed, he has again called for Russia to be
“Cohesion, trust and unity are unravelling as the Kananaskis Summit approaches. US relations with its long-time allies in Europe have become highly strained. Donald Trump is tearing apart the glue that holds the G7 together”
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