The G7 Summit is the annual meeting of the Group of Seven leaders. It's hosted by the G7 president for that year. The summit doesn't have any legal or political authority. But when these seven world leaders agree on something, it has the power to shift the direction of global economic growth.
G7 Member Countries and Other Attendees
The G7 member countries are the United States, the U.K., France, Japan, Germany, Italy, and Canada. The first six countries were the original members of the G6. Its first summit was held at Rambouillet, France, in 1975. Canada joined in 1976, making it the G7. In 1997, Russia joined, making it the G8.
In 2013, however, the G8 became the G7 once again. when Russia invaded Crimea. The other G8 members imposed sanctions against Russia, including exclusion from the G8.
Other important global leaders are invited, including representatives of the European Union, China, India, Mexico, and Brazil. Invitations are also extended to the leaders of important international organizations, including the International Monetary Fund (IMF), World Bank, and United Nations.
The 2021 G7 Summit was held June 11-13, 2021, at Carbis Bay, Cornwall in the United Kingdom. The Summit resulted in four major outcomes on key global issues:
- COVID-19: The G7 pledged to provide over 1 billion doses of COVID-19 vaccines to the developing world.
- Climate Change: The G7 pledged to phase out coal-fired power generation in G7 countries and to phase out funding in the developing world for coal-fired power generation, as well as to provide additional funding for clean energy production.
- U.S. Foreign Policy: U.S. President Joe Biden proclaimed "America is back at the table." He committed to be more supportive to the G7 allies in promoting common values on the global stage.
- Global Tax Policy: The G7 pledged to move towards a minimum 15% tax to put pressure on multinational firms to refrain from locating in low-tax jurisdictions.
The United States was scheduled to host the G7 summit in June 2020. However, President Donald Trump postponed the summit indefinitely due to the COVID-19 pandemic.
The last time the U.S. hosted the event was in 2012, when President Barack Obama held it at Camp David.
France hosted the 2019 Summit at Biarritz on August 25–27, 2019. Its official focus was on fighting income and gender inequality and protecting biodiversity. French President Emmanuel Macron also used the Summit to promote Europe as a global leader on several issues. Most notable was a solution to the Amazon forest fires—the G7 promised $20 million to fight the fires. Macron convinced Trump to soften on his trade war efforts. He also got him to tentatively agree to meet with Iranian President Hassan Rouhani.
Canada hosted the 2018 Summit at La Malbaie, Quebec, on June 8–9. President Trump antagonized the other members by refusing to sign the final joint statement because he objected to any mention of "the rules-based international order." Members were upset about the trade war Trump had initiated when he imposed tariffs on steel and aluminum. Trump also wanted the EU to spend more on its own defense.
Italy hosted the 2017 Summit at Taormina on May 26–27. President Trump agreed to back a pledge against protectionism. He refused to endorse the Paris climate change accord. Members agreed to further sanction Russia if it intervened again in Ukraine. President Issoufou of Niger reminded leaders of the need for further economic development in Africa to stop the flow of migrants. He also asked for intervention to end the crisis in Libya, which was the transit point for migrants heading to Europe.
Japan hosted the 2016 Summit at Ise-Shima on May 26–27. The leaders promised to support free trade agreements, including the Transatlantic Trade and Investment Partnership and the Trans-Pacific Partnership. They agreed to improve infrastructure within their own and other countries. The group established a new cyber-terrorism working group to enhance cooperation. It promised to help stabilize the Middle East to reduce the flow of refugees into Europe. The leaders promised to fight global warming by entering the Paris Agreement.
Germany hosted the 2015 Summit at Elmau Castle on June 7–8. The G7 announced a plan to phase out all fossil fuels worldwide by 2100. It addressed terrorism issues but did not create a unified plan to attack ISIS. It also left the Greek debt crisis to the EU and IMF to resolve.
Russia's President Vladimir Putin was supposed to host the G8 in Sochi on June 14–15. Instead, the G7 canceled the meeting and held an emergency summit in Brussels, Netherlands, on June 4–5. The group continued economic sanctions against Russia and gave $5 billion in aid to Ukraine. It also pledged to provide national emission reduction plans, unveiling its plan to reduce emissions from existing power plants by 30% by 2030 compared to 2005 levels. Additionally, the G7 committed further support to the World Health Organization's efforts to reduce infectious diseases like Ebola and Tuberculosis.
The 2013 Summit was held on November 17–18 at Lough Erne, Enniskillen in Northern Ireland. It was hosted by U.K. Prime Minister David Cameron. The leaders agreed a number of commitments, including:
- They would hold a conference to reach a political solution to the Syrian conflict. The G8 tried to overcome Russia's resistance to intervening in Syria, its ally.
- They planned to work together to find tax evaders.
- They would support the Transatlantic Trade and Investment Partnership, negotiations over which began following the Summit. They also expressed support for the EU-Japan and the EU-Canada trade agreements.
- They committed to stamping out ransom payments to terrorists, a major issue that the countries were seeking to address.
U.S. President Barack Obama hosted the 2012 Summit on May 18–19 at Camp David in Frederick, Md. The focus was on the global threat of the EU crisis. The G8 leaders agreed that Greece should be kept in the Eurozone. As a result, the EU shifted from austerity measures to promoting growth. The leaders agreed on a host of wide-ranging issues, including:
- They would seek to ensure the safety of the world's energy supply, support alternative sources, and reduce climate pollutants, such as methane, black carbon, and hydrofluorocarbons.
- They targeted improving food security in Africa with the New Alliance for Food Security and Nutrition, with the goal of lifting 50 million people out of poverty over the next decade.
- They would contribute $16 billion annually through 2017 to address Afghanistan’s debt.
- The G8 agreed to support Arab countries in transition with the Deauville Partnership.
The 2011 Summit was hosted by French President Nicolas Sarkozy at Deauville, France on May 26–27. They responded to the Arab Spring uprisings by creating the Deauville Partnership to promote political and economic reform in these countries. According to the European Commission on the G8 France 2012, they created the first-ever declaration on human rights, democracy, and sustainable development for Africa.
In response to Japan's nuclear disaster, the leaders agreed to stress test their nuclear plants and review international safety standards.
On June 25–26, 2010, the G8 Summit was held in Huntsville, Ontario, and hosted by Canadian Prime Minister Stephen Harper. At that meeting, the G8 committed an additional $5 billion to the Muskoka Initiative on Maternal, Newborn, and Child Health. Leaders focused on responding to the threats from nuclear proliferation in Iran and North Korea and on encouraging stability in Afghanistan and Pakistan.
Controversial Prime Minister Silvio Berlusconi hosted the July 8–10 Summit in L'Aquila, Italy. The primary focus of the conference was an agreement to continue the ongoing efforts to contain the global financial crisis. This conference included many members of the G20, who had not seen the same level of economic destruction.
Members also agreed to a host of wide-ranging commitments. These included efforts to reduce climate change, recommit to supporting African countries, spend $20 billion over the next three years to boost farming in rural areas, condemn Iran's nuclear program, support a reduction of nuclear arms in the United States and Russia, and support the two-state solution for Israel and Palestine.
This critical conference was held in Tokyo, Japan from July 7–9 2008. Hosted by Prime Minister Yasuo Fukuda, the leaders still promoted optimistic views about the global economy while it crumbled around them. In fact, they were more concerned about inflation, a result of record-high oil, gas, and food prices.
Leaders also held hopes that the WTO Doha Round of negotiations would be successful. They stated a goal of 50% reduction of global emissions by 2050, to reverse global warming. Like the other summits, leaders supported the reduction of poverty in Africa and expressed concern over hot spots like North Korea, Iran, Afghanistan, and Israel, as well as Sudan, Myanmar, and Zimbabwe.
How the G7 Lost Power
In 2008, a subtle shift of power occurred. While the G8 talked about food inflation and all kinds of other admittedly important world issues, they completely missed the 2008 global financial crisis. As a result, it signaled the end of the old world order and the beginning of a new one.
The meeting was held in July, while Fannie Mae and Freddie Mac were going bankrupt. It was after bank-lending Libor rates went haywire. It also occurred after the Fed held its first emergency meeting in 30 years to rescue investment bank, Bear Stearns. In other words, there were plenty of clues that these world leaders needed to do something fast.
Instead, the G20 countries stepped in at their summit and addressed the root of the problem. They requested that the United States regulate its financial markets more. The United States refused, allowing unregulated credit default swaps and other derivatives to plunge the world into financial crisis and recession.
After that, it became apparent that the G20's emerging market countries, which had largely escaped the crisis, were necessary partners of any global initiative. And the G20 Summit superseded the G8 as the world's most important meeting of all global leaders.
Unfortunately, the G8 missed a critical opportunity to avert the 2008 global economic recession. They refused to agree to a code of conduct for hedge funds, which are located primarily in the United States and the United Kingdom. They recognized it was needed but didn't have the political will to follow through.
Instead, German Chancellor Angela Merkel agreed to meet with these hedge funds to convince them of the wisdom in establishing a self-regulating code of conduct. As we now know, her efforts were not enough to reduce the global risks that unregulated hedge funds created.
In 2007, Merkel was Chair of the G8 Summit. She brokered a historic climate change agreement that included getting the United States to agree that its climate change policy is under the auspices of the U.N. Until then, the United States had resisted subjugating its actions to U.N. policy.
Merkel got the United States to agree to “seriously consider” cutting greenhouse gas emissions in half by 2050. Chancellor Merkel’s leadership on this issue seemed to indicate that the EU was becoming more of a global leader than the United States. This would have represented a significant change from the post-WWII Marshall Plan era.