G-7 Finance Ministers Aim to Avoid Public Spats With US Despite Trade Turmoil

Jerome Powell, chairman of the US Federal Reserve Photo by Tierney L. Cross /Photographer: Tierney L. Cross/B

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(Bloomberg) — When Germany’s Angela Merkel was photographed at the 2018 Group of Seven meeting, surrounded by others and leaning over a cross-armed Donald Trump, the image was seen as a public display of world leaders pushing back against a disruptive US president. 

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As Canada hosts the G-7 meetings again, US allies broadly agree: they don’t want to recreate that moment. They’ll make every effort to avoid public confrontations with US officials this time, even as the White House targets their countries with tariffs, worsening the global economic outlook. 

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G-7 finance ministers gathered in Alberta this week hope to make their case against Trump’s trade policy to Treasury Secretary Scott Bessent while also alleviating tensions and finding common ground, especially on China, according to people familiar with the matter, asking not to be identified in order to discuss private deliberations.

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Ahead of the summit, intensive work was underway to find common language on trade policy and Ukraine, two key sticking points. 

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Some G-7 members will want to pin down the Americans on wording about trade but it will be difficult, according to one of the people. Bessent — who has emerged as one of Trump’s chief trade negotiators — is expected to hold bilateral meetings with each of his counterparts.

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One topic where the G-7 is likely to find some consensus is China. The Canadian hosts have made sure to put Chinese trade practices on the agenda — uniting the interests of all members, though some are wary of doing too much China-bashing. Bessent will advance the US position that Chinese overcapacity is doing great harm to manufacturing and output in other nations. 

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Countries have stepped up their trade actions against Asia’s largest economy to align themselves more with the US. France is pushing to add fees to small packages from discount retailers such as China’s Temu and Shein, while the UK is weighing a similar move — akin to the US step of removing the de minimis exemption. Canada broadly matched US tariffs on Chinese electric vehicles, steel and aluminum last year.

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But the group’s ability to unite against China has been fractured somewhat by Trump’s aggressive trade moves against traditional allies, including Canada and the European Union. One person involved in the preparations described this week’s meeting as a family needing to get together and sort out its own internal issues before being able to talk about a showdown with an outsider.  

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UK Chancellor of the Exchequer Rachel Reeves hopes to stress the importance of open and free trade to boost growth after her country recently signed agreements with the US, India and the EU. She’ll try to present herself as leading the push on trade, said a person familiar with her thinking, though her conversation with Bessent may also need to address some of the unanswered questions left in the UK-US agreement.