G7 Summit in Japan: Industrialised Countries Commit to World Trade and Decarbonisation

© Lawrence Jackson, Wikimedia Commons, Public Domain

In Japan the G7 states reiterated their commitment to globalisation and free trade. They were unable to agree on a global regulatory framework for CO2 trading. Under the Italian Presidency in 2017 the G7 need to demonstrate strong leadership.

At the G7 summit at the end of May in Ise-Shima (Japan) the G7 states left no doubt that they remain firmly committed to globalisation. Together they intend to strengthen the rule-based multilateral trade system and advance the WTO talks. They also support efforts to liberalise trade through regional agreements like TTIP and CETA. Global overcapacity, especially in the steel industry, needs to be urgently tackled.

Global Energy Transition Requires the Establishment of a Global Regulatory Framework for CO2 Trading

 

In the area of climate and energy, the evaluation of the summit outcomes is mixed. On a positive note, the G7 seek to implement the Paris Agreement by the end of this year. They also commit to implement their respective national contributions. That the idea of a global carbon market has not been taken up is on the other hand regrettable. Although the G7 again underlined the importance of decarbonising the global economy, a successful global energy transition will require the establishment of a global regulatory framework for CO2 trading. The G7 must demonstrate its leadership role and jointly advocate that goal at the G20 level.

In 2017 Italy assumes the G7 Presidency. With Germany holding the G20 Presidency, two European countries will take the lead in the global governance arena.