G7 Leaders to Address Concerns Over Chinese Overproduction

G7 Leaders to Address Concerns Over Chinese Overproduction

The government sources of Japan had mentioned that the question was to be raised during the Italy summit.

According to Japanese government sources, the Group of Seven nations are expected to express worry about excessive government backing of overproduction in China at a summit that will commence in Italy next Thursday.

At the three-day meeting, the leaders of the nations will also discuss countering Chinese export controls on key minerals, including gallium, germanium, and graphite, and strengthening supply chains in the U.S., Germany, Japan, France, the U.K., Canada, and Italy.

One of the things that will be discussed is economic stability due to many electric vehicles (EVs) and solar panels being manufactured in China.

China has been widely criticised by Japan, the U.S., and European countries for providing huge subsidies and tax advantages that result in overproduction and distort free and fair international competition.

The overproduction problem has hit both EVs and solar panels. In late 2023, the U.S. and the European Union came out with countermeasures. In as much as China remains on the prowl to give explanations on overproduction, it is expected that the G7 will all maintain a common policy perspective aimed at countering this particular narrative put forward by China, which in turn serves as a good reminder that international economic order cannot be sustained when developing countries decide to produce too much.

According to the sources, the text of a statement by leaders is finished to consider certain countries’ points of view on the problem such as the United States, Japan, and European Union are strongly against unnecessary production and it is Germany and France who are much more reserved when it comes to assessing China’s role in it.

In addition to addressing issues facing economic security like the incursion of China and Russia into fragile economies, and re-building supply chains for critical minerals, the declaration will also stress the necessity to guard against and eliminate advanced technology drain items using universities for instance.

The statement of the leaders will urge unity with Ukraine, which was invaded by Russia in 2022, and support for military operations, particularly air defence. At the same time, they will approve a scheme to financially aid Ukraine drawing from blocked Russian money.

Regarding sanctions against Russia, mention will be made of instead punishing companies and people in other countries, not necessarily China, who help Russia avoid restrictions on exports or imports.

There are suspicions that Russia could be supplied with goods that may be used for military purposes from China and other sources thus raising the need for such a measure. The sources say that Japan will soon take a similar action over certain third countries’ businesses like some from China.

“The leaders will discuss how to handle artificial intelligence risks. By chair Italia’s invitation, Pope Francis will talk on AI ethics. Besides, G7 will discuss the supervisory policy as provided for in last year’s code of conduct for AI companies and stakeholders under the Hiroshima AI Process that was launched by the Japanese Prime Minister Kishida.”

The leaders will clearly state that a stable supply of energy is important because there will be more data centres that power AI computing leading to an increase in electricity demand.

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