[The Editors' Verdict] Expectations for the Expanded G7 Summit

Roundtable on Japanese Government's Export Regulations, Professor Jeong In-kyo, Inha University. Photo by Kim Hyun-min kimhyun81@

The other day, U.S. President Donald Trump announced plans to expand the Group of Seven (G7), a gathering of major advanced economies, to find solutions for the global economic turmoil caused by the COVID-19 pandemic. He invited South Korea, Australia, India, and Russia to the G7 summit, postponed to September. The U.S. appears to be considering adding Brazil as well, potentially creating a G12 framework.

During a phone call between the South Korean and U.S. presidents on the 1st, President Moon Jae-in expressed his willingness to accept President Trump's invitation to the expanded G7 summit. For the South Korean government, which had been fully committed to arranging a visit by Chinese President Xi Jinping, deciding to participate in the G7 summit was likely not an easy choice. However, amid the worsening global economic outlook due to the overlapping G2 conflict and the COVID-19 crisis, South Korea, as the world's sixth-largest trading nation, joining efforts to find global solutions represents a significant opportunity to enhance its international standing and develop a national survival strategy.

The most internationally recognized summits are the G7 and G20. The G7 consists of advanced economies with large economic scales, including the U.S., Japan, the U.K., France, Germany, Italy, and Canada. It began in 1973 during the first oil shock when finance ministers from the world's five largest economies at the time?the U.S., U.K., France, Germany, and Japan?met. The first summit was held in 1975 following the second oil shock. Italy and Canada joined the following year, and Russia became a member the year after that but was expelled in 2014 due to its annexation of Crimea in Ukraine.

The G20 started in 1999, a year after the East Asian financial crisis, when the International Monetary Fund (IMF) agreed to hold meetings between the G7 and emerging countries. The G20, which includes South Korea, China, Brazil, India, Australia, Indonesia, Mexico, Russia, and Saudi Arabia, accounts for 90% of the world's gross domestic product (GDP). The G20 summit played a leading role in overcoming the 2008 global financial crisis.

The COVID-19 pandemic is a global issue that is difficult to resolve without international cooperation. However, the U.S. has clearly drawn a line regarding cooperation with China. While inviting Russia, with whom relations are strained, China was deliberately excluded. Holding an expanded G7 summit instead of the existing G20, which includes China, is closely related to the U.S.'s China policy. Excluding China from the expanded G7 summit is part of this strategy. The U.S. has already begun decoupling efforts from China through the Indo-Pacific Strategy and the Economic Prosperity Network (EPN). Inviting Russia extends the scope of China's isolation, seemingly aiming to break the China-Russia alliance and neutralize the Shanghai Cooperation Organization led by China.

By raising the "COVID-19 responsibility theory," the U.S. is isolating China and establishing a new global trade order. The White House stated that the expanded G7 summit excluding China is intended to consult with traditional allies on future issues related to China. President Trump has also described the G7 framework as outdated and not reflective of current realities.

Participation in the expanded G7 summit signals a shift in South Korea's foreign policy. The possibility of resolving U.S.-China conflicts is very low. Instead, the new Cold War dynamics are intensifying. As the country with the highest trade dependence in the world, South Korea must actively prepare for the new Cold War situation more than any other nation.

Japan, the only G7 member in Asia, seems reluctant about the expanded G7 summit. Moreover, it appears to have considerable discomfort regarding South Korea's participation. We hope that South Korea can explore its foreign policy in the new Cold War era through participation in the expanded G7 summit, and diplomatic efforts should focus on ensuring that this meeting does not end as a one-time event but becomes a newly regularized summit.

Jung In-kyo, Professor, Department of International Trade, Inha University