By Alexander Miller, consultant in emerging markets. Eurasia Business News – May 22, 2023

China’s President Xi Jinping. 

The leaders of the G7 countries want to ensure the resilience of the supply chain of goods critical to the economy, in particular semiconductors and batteries. This is one of the tools that the G7 countries are committed to use to “counter China’s economic pressure“, according to a joint statement adopted at the summit in Hiroshima. China responded by demanding an end to “intimidation.”

“The COVID-19 pandemic and Russia’s war of aggression against Ukraine has laid bare vulnerabilities in supply chains in countries around the world.”

We will strengthen sustainable supply chains through partnerships around the world, especially critical goods such as critical minerals, semiconductors and batteries,” the document says.

In addition, the G7 countries plan to conduct stress tests of economies based on the assumed scenarios. In a statement, the leaders of the G7 countries also noted the importance of projects that increase resilience in the field of information and communication technologies: mobile and satellite communication networks, submarine cables and cloud storage.

As Assistant to the President of the United States Jake Sullivan said at the G7 summit, tools to ensure economic security will include steps to increase the resilience of supply chains, attract foreign investment and export controls, designed to protect confidential technologies. According to the Financial Times, the United States and its allies are concerned about China’s ability to obtain foreign technologies that go to the development of military power.

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The New York Times noted that the G7 countries also want to reduce dependence on Chinese production and help their companies compete in the new energy economy. This has been the goal of US President Joe Biden’s policies in recent years: he passed bills to develop the production of semiconductors, low-emission energy sources, allocated subsidies for electric vehicles, batteries, wind farms, solar power plants and much more.

This clean technology race is an opportunity to go faster and further together,” said European Commission President Ursula von der Leyen after a meeting on the economy at the summit.

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G7 leaders also warned that states trying to use the trade as a weapon would face “consequences” – as Reuters notes, this was a separate signal to China. We must use all means to force support for Ukraine and the protection of its territorial integrity and sovereignty,” the French presidential aide said.

According to Bloomberg, China, in response to statements by G7 leaders, called on the United States to stop “intimidation” in order to force allies to disrupt the stability of global supply chains, and also called on countries to abandon their “Cold War mentality.”

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