As it turns out, the United States and its western allies have completely failed to narrow their divisions over trade and tariffs in the latest G7 summit.
Worse still, there is a chance their divisions may deepen as US President Donald Trump suddenly changed his mind and refused to endorse the joint statement of the summit which vowed to fight protectionism.
Trump later explained on Twitter that he decided to back out of the joint communique because Canadian Prime Minister Justin Trudeau, this year’s host of the summit, had made “false statements” during his news conference.
As we can see, the Group of Seven is witnessing probably its worst internal divisions ever as a result of Trump’s flip-flopping.
Things might go from bad to worse for the G7 as the White House has threatened to impose tariffs on all imported automobiles on top of those on steel and aluminum imports which have already come into effect.
The bitterly divided G7 indeed bears a stark contrast to the relatively harmonious Shanghai Cooperation Organization (SCO), which recently held its two-day annual summit in Qingdao in China’s eastern Shandong province.
Before attending the meeting, Russian President Vladimir Putin met with Chinese President Xi Jinping last Friday, during which he was awarded China’s first friendship medal and was referred to as Beijing’s best friend by Xi.
The fact that the G7 summit and the SCO meeting were held almost simultaneously would inevitably lead to comparison of the two supranational bodies by international media.
That Iran attended the SCO meeting this year as an observer has sparked widespread speculation that Tehran might have the intention to seek some sort of assistance from Beijing in the face of mounting US hostility after Washington’s withdrawal from the Iran nuclear deal.
Putin also expressed support for Iran to become an official member of the SCO, thus bringing China and Iran closer, and for Iran and Russia to develop a closer relationship.
There is a view that the SCO is mainly a platform to address regional security issues, including how to combat separatism, extremism and terrorism.
However, in our opinion, we believe it is quite unlikely that China would form any sort of a close alliance with Iran at least in the short run.
Even though trade disputes between Beijing and Washington have not escalated to a critical level, China could risk further unsettling the US by getting closer with Tehran and jeopardizing the prospect of establishing a new form of Sino-US relationship as Xi has proposed.
Apparently, further fuelling its ongoing tension with Washington for whatever reason is not in Beijing’s best interests at this delicate moment.
As far as the SCO is concerned, we also don’t think it is powerful enough to become an equal rival to the G7, despite the fact that the latter is now seriously split.
Besides, the SCO itself also has its own internal issues. Clear examples would be the intense rivalry between India and Pakistan as well as New Delhi’s lukewarm response towards Beijing’s Belt and Road Initiative.
This article appeared in the Hong Kong Economic Journal on June 11
Translation by Alan Lee with additional reporting
[Chinese version 中文版]
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