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Cornwall's Take-off on Trade Matthew Kieffer
Matthew Kieffer, G7 Research Group
June 13, 2021
Trade has been a staple of the G7 since its inception. With countries around the globe still reeling from the economic impacts of COVID-19, it is crucial for G7 leaders at Cornwall to support free trade and kickstart economic recovery. Historically, the G7 has struggled with trade compliance, averaging only 65%, as compared to the overall average compliance of 76%. However, the 2020 G7 Virtual Summit saw 100% compliance across all three trade commitments assessed. To build upon this momentum, leaders must make transparent, precise and politically binding commitments.
The lead-up to Cornwall looked promising. A trade ministers meeting on March 31 – the first one since Tokyo 1999 – produced 17 commitments outlined in the chair's statement. The subsequent meeting on May 28 produced a proper communiqué, which, in addition to commenting on classic trade subjects, included several synergistic commitments incorporating climate change, gender equality, human rights, health and digitization. However, with the summit now underway, early signs indicate that trade has taken a backseat to more pressing global crises on climate change and COVID-19.
On 11 June 2021, leaders met for the first plenary session to discuss economic recovery and gender equality. They spent most of their 97-minute meeting on the first topic, engaged in very active discussions. Japan's Prime Minister Yoshihide Suga's remarks contained the usual suspects: affirming the importance of promoting multilateral trade, reforming the World Trade Organization (WTO) and bolstering global supply chains. Suga recognized issues such as industrial subsidies, digital protectionism and technological information leakage, but did not suggest concrete actions to address these market distortions. Such statements largely reiterate previous commitments made at the recent trade minister meetings.
On 12 June 2021, WTO director general Ngozi Okonjo-Iweala gave a briefing that focused primarily on equitable vaccination, affirming that vaccine policy is trade policy. She suggested that accelerating the vaccine rollout will jumpstart growth, and pointed to vaccine inequity as a source of the divergent recovery path between developed and developing markets. Dr. Okonjo-Iweala encouraged leaders to mobilize synergies between trade and vaccination and to fight vaccine protectionism.
To drive forward trade and speed up economic recovery, G7 leaders need to build on their trade ministers' commitments made in May and produce synergistic commitments that incorporate trade into the vaccine rollout and climate solutions.
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