G7 Faces Tariff Tensions, Backs Ukraine

Finance ministers from the Group of Seven nations concluded the first day of their meeting in the Canadian Rockies with a fractured front on trade policy but a renewed collective pledge to support Ukraine in its war against Russia.

Germany’s Finance Minister Lars Klingbeil declared that G7 members remain firmly committed to aiding Ukraine. “It became clear that within the G7 format, support will continue unchanged, and that Ukraine can rely on strong solidarity and substantial support from the G7 countries,” Klingbeil stated after meetings in Banff.

Tensions Over Tariffs and China

Yet beneath the expressions of unity, tensions simmered. U.S. Treasury Secretary Scott Bessent — representing the Trump administration — pressed G7 counterparts to toughen stances on China’s non-market economic policies. European officials, however, stressed that tariffs were not the right response.

The G7 is struggling to craft a joint communique due to U.S. demands to remove language describing Russia’s invasion of Ukraine as “illegal.” Italy and the U.S. also pushed to bar countries that supported Russia’s war effort from participating in Ukraine’s reconstruction, a move targeting China’s indirect assistance to Moscow.

Diplomatic Manoeuvring Behind Closed Doors

Bessent sought to ease concerns, holding bilateral talks with finance chiefs from Japan, France, Germany, Canada, and others. French Finance Minister Eric Lombard noted “a marked improvement in the mood,” calling the exchanges “sincere and honest.” Still, agreement on the communique remained uncertain by late Wednesday.

“We expect a thorny discussion on the price cap,” a European official warned, referring to ongoing talks about lowering the $60-per-barrel limit on Russian crude — a key element of Western sanctions.

A Difficult Path Toward Consensus

Officials acknowledged that Trump’s expanded tariff regime was a central obstacle to unity. Canada, the UK, and several EU countries remain subject to steep U.S. duties, with potential increases looming in July. G7 delegates appeared determined to avoid a repeat of the “G6+1” fallout from the 2018 summit, which collapsed over Trump-era tariffs.

Despite the unresolved issues, German minister Klingbeil expressed “cautious optimism” that a final statement could still be reached. “We’re working intensely on it — there are still a few points we need to resolve,” he said.

G7’s Balancing Act

This year’s summit reflects the G7’s precarious effort to balance geopolitical unity with economic divergence. While Ukraine remains a binding issue, the bloc is facing rising internal disputes over global trade architecture, China policy, and the future of multilateralism — all intensified under Trump’s second presidency.