G7 leaders meet in Canada hoping to avoid Trump clash
BANFF, Alberta: Group of Seven leaders gather in the Canadian Rockies starting on Sunday (Jun 15) amid growing splits with the United States over foreign policy and trade, with host Canada striving to avoid clashes with President Donald Trump.
While Prime Minister Mark Carney says his priorities are strengthening peace and security, building critical mineral supply chains and creating jobs, issues such as US tariffs and the conflicts in the Middle East and Ukraine are expected to feature heavily.
Israel and Iran launched fresh attacks on each other overnight into Sunday, killing scores hours before the leaders of the world's industrialized democracies meet.
"This issue will be very high on the agenda of the G7 summit," German Chancellor Friedrich Merz said. He said his goals are for Iran to not develop or possess nuclear weapons, ensuring Israel's right to defend itself, avoiding escalation of conflict and creating room for diplomacy.
The summit takes place in the mountain resort of Kananaskis, some 90 km west of Calgary.
The last time Canada played host, in 2018, Trump left the summit before denouncing then Canadian Prime Minister Justin Trudeau as "very dishonest and weak" and instructing the US delegation to withdraw its approval of the final communique.
"This will be a successful meeting if Donald Trump doesn't have an eruption that disrupts the entire gathering. Anything above and beyond that is gravy," said University of Ottawa international affairs professor Roland Paris, who was foreign policy adviser to Trudeau.
Trump has often mused about annexing Canada and arrives at a time when Carney is threatening reprisals if Washington does not lift tariffs on steel and aluminum.
"The best-case scenario ... is that there's no real blow-ups coming out of the back end," said Josh Lipsky, the chair of international economics at the Atlantic Council think tank and a former White House and State Department official.
Carney's office declined to comment on how the Israeli strikes would affect the summit.
Diplomats said Canada has ditched the idea of a traditional comprehensive joint communique and would issue chair summaries instead, in hopes of containing a disaster and maintaining engagement with the US.
A senior Canadian official told reporters Ottawa wanted to focus on actions the seven members, Canada, France, Germany, Italy, Japan, the United Kingdom and the United States, could take together.
Canadian Senator Peter Boehm, a veteran former diplomat who acted as Trudeau's personal representative to the 2018 summit, said he had been told the summit would last longer than usual to give time for bilateral meetings with the US president.
Expected guests for parts of the Sunday to Tuesday event include leaders from Ukraine, Mexico, India, Australia, South Africa, South Korea and Brazil, who all have reasons to want to talk to Trump.
"Many will want to talk to President Trump about their own particular interests and concerns," Boehm said by phone.
A senior US official said on Friday working discussions would cover trade and the global economy, critical minerals, migrant and drug smuggling, wildfires, international security, artificial intelligence and energy security.
"The president is eager to pursue his goals in all of these areas including making America's trade relationships fair and reciprocal," the official said.
The visit of Ukrainian President Volodymyr Zelenskyy to the Oval Office in February descended into acrimony and has served as a warning for other world leaders about the delicate dance they face in negotiating with Trump.
But diplomats say the frustration of dealing with the Trump administration has made some keener to assert themselves.
'THE BIG TEST'
Canada has long been one of Ukraine's most vocal supporters. Trump came to power promising to end the war with Russia within 24 hours but diplomatic efforts to end the conflict have stalled.
One Ukrainian official involved in preparations for the summit said hope had faded for a strong statement in support of Ukraine. Instead, success for Kyiv would merely constitute an amicable meeting between Trump and Zelenskyy.
A European official said the G7 summit and the NATO summit in The Hague later in June provided an opportunity to underscore to Trump the need to press ahead with a sanctions bill put together by US senators alongside a new European package to pressure Russia into a ceasefire and broader talks.
Trump's first international summit will offer some early clues on whether Trump is interested in working with allies to solve common problems, said Max Bergmann, a director at the Center for Strategic and International Studies.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
CNA
an hour ago
- CNA
Explainer-What are bitcoin treasury strategies, the latest trend in the public markets?
Certain public companies, including one founded by President Donald Trump, have been going on a cryptocurrency buying spree, capitalizing on higher token prices and a softening regulatory environment to load up on the attention-grabbing investment. Sixty-one publicly-listed companies not primarily engaged in digital assets have adopted what are known as bitcoin treasury strategies, in which firms allocate a portion of their cash and reserves toward the world's largest cryptocurrency, according to a report from Standard Chartered. Here is what you need to know about the trend: WHY ARE COMPANIES DOING THIS? Many of those companies are seeking to replicate the success of Strategy, formerly known as MicroStrategy, a software company that began accumulating bitcoin in 2020 and now holds more than $63 billion worth. Its stock is up more than 3,000 per cent since 2020 as the price of bitcoin has skyrocketed, hitting fresh all-time highs above $110,000 this year. Strategy copycats have doubled their holdings in bitcoin in just the last two months to collectively hold just under 100,000 bitcoin, Standard Chartered said. Those firms include Trump Media & Technology Group, which raised $2.5 billion last month to invest in bitcoin. While investors can readily buy bitcoin directly or through an exchange-traded fund, investors typically cannot get the same kind of leverage a public company might be able to get through the convertible debt markets to buy bitcoin. Companies like Strategy trade at a premium to their bitcoin holdings because investors believe that those firms can utilize their access to credit markets to purchase even more bitcoin. Strategy and Trump Media & Technology Group did not immediately respond to requests for comment. WHICH COMPANIES ARE DOING THIS? Besides Strategy and Trump Media & Technology Group, a joint venture announced in April between SoftBank, stablecoin issuer Tether, and Cantor Fitzgerald - previously helmed by U.S. Commerce Secretary Howard Lutnick - caught investors' attention. The group is launching a $3.6-billion venture called Twenty One with the goal of acquiring bitcoin. SolarBank, a Toronto-based solar energy company, announced this month it would implement a bitcoin treasury strategy, saying it would expose the company "to a new category of tech-savvy investors." SolarBank has not disclosed how much bitcoin it plans to buy, only saying that the allocation strategy will be determined by management. "Traditionally, people invest in utilities as (an) afterthought. It's a very low return. It's a stable return," said SolarBank CEO Richard Lu. "So, how do we bridge the excitement of the new world and a classic industry? We feel that the crypto part of that is a bridge we need to cross." Upexi, a consumer products company, recently launched a treasury for Solana, another top cryptocurrency. "It is a great way for a company to really bring attention to itself and grow," said Brian Rudick, the firm's chief strategy officer. "If a company has a fiduciary duty to do what's best for shareholders, and if you're going to raise funds and invest it in the operating business, or if you can invest in funds and put it into a digital asset treasury that the market is rewarding companies that do so, you should do the latter," Rudick said. WHY NOW? The trend comes as Trump has sought to overhaul U.S. cryptocurrency policy after courting cash from the industry on the campaign trail. He signed an executive order in March to establish a strategic bitcoin reserve and has hosted industry leaders at the White House. Those moves have boosted the price of bitcoin and other cryptocurrencies. "It may be that some firms are trying to get political attention. This is clearly something President Trump has signaled his interest in," said Chester Spatt, a finance professor at Carnegie Mellon University. The stark shift in policy under Trump "is a serious tailwind for more and more institutions to get into the space," said Roshan Robert, CEO of crypto exchange OKX. "How institutions are looking at building out treasury applications is just a part of that broader picture." WHAT ARE THE RISKS? It is unclear if the various crypto treasury strategies will ultimately be successful, particularly if firms are buying in now as prices flirt with record highs in a sector that is no stranger to volatility. Charles Schwab, in a report last month, noted that if a company has significant crypto holdings that suddenly collapse in value, the firm could experience a liquidity crisis. Standard Chartered estimated that if bitcoin were to fall back below $90,000 it would put half of companies' bitcoin treasuries underwater. "As always, there will be some really, really big winners and some really big losers whenever there's a mania like this," said Ravi Doshi, the global co-head of markets at crypto platform FalconX.
Business Times
an hour ago
- Business Times
Asia-Pacific equities are a compelling investment proposition
A MONTH is a long time in equity markets. Since Apr 9 when US President Donald Trump announced a 90-day pause in his plan to impose 'reciprocal' tariffs on the rest of the world, the S&P 500 has rallied hard. The 90-day detente between the US and China, announced on May 12, and soft US inflation data on May 13 solidified the US market gains, putting talks of a rotation from US assets on the back burner. Given the US' trade framework agreement with the UK and its 90-day detente with China still imply much higher tariffs levels, we think the euphoria may be premature. The negative impact of Trump's trade policies will hit the US the hardest – and that is not yet reflected in economic data. In previous cycles, equity market weakness has translated to US dollar strength in a 'flight to safety'. But that appears to have changed in this cycle with the US dollar proving vulnerable to swings in market confidence. Moreover, the US fiscal position is likely to worsen, with Trump certain to plough revenues from tariffs into tax cuts, and that would be US dollar-negative. Global investors remain very overweight on US equities, and we believe there will be a gradual move to increase allocations to other regions, and especially the Asia-Pacific. Asia-Pacific starting to get inflows Investors remain very underweight Asia-Pacific equities which is more a reflection of the past decade of US dominance than Asia's economic fundamentals. However, in recent weeks, there has been a nascent change in trend with April 2025 inflows into Asia equity exchange-traded funds at US$33.3 billion, exceeding flows into the US (US$31 billion) and European (US$9.1 billion) equivalents. This indicates that the region is a destination for those seeking to diversify. Japan is seen as a particularly attractive market for the 'dedollarisation' trade, attracting US$57 billion into equities and bonds, the biggest monthly inflows since records began. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Asia-Pacific equity valuations are close to trough levels compared to the US. On that basis, even given the US tariff headwinds, there is significant value to unlock. This makes the region a target-rich stock-picking environment. Pressure on to reduce US tariffs Asia-Pacific economies are very exposed to global trade flows. Major export economies such as Japan, South Korea and Taiwan potentially face very high tariff levels (24 per cent, 26 per cent and 32 per cent, respectively), unless they can agree on a framework for reductions by early July when the 90-day reciprocal tariff pause expires. Emerging export-driven economies are in the same boat, with Vietnam (46 per cent), Indonesia (32 per cent), and Thailand (37 per cent) all seeking to negotiate. Given the detente with China, the Trump administration's desire to be seen to do deals, and geopolitical leverage via longstanding security ties, we expect the tariff levels to trend towards the baseline 10 per cent Trump originally set. The net effect on transpacific trade will be negative. Economically, this means 2025 Asia-Pacific gross domestic product growth estimates of around 3.7 per cent at the start of the year could be difficult to achieve. But growth will still be much higher than projections for the US and Europe. For the region, the most immediate countervailing policy response will be fiscal expansion in key economies including China, India and Indonesia. Moreover, inflation is already trending lower across the region, giving central banks room to ease policy more – especially if the US dollar weakens further. Positive Asia fundamentals For investors seeking long-term diversification from an overweight position in US equities, Asia-Pacific equities have a compelling investment thesis. An Asia-Pacific portfolio gives exposure to developed markets such as Australia and Singapore as well as emerging markets like Indonesia and India across all sectors – from commodities and industrials to technology, financials and consumer discretionary. We believe exposure to the North Asian industrial economies of China, South Korea, Taiwan and Japan is essential, with world-class companies and an increased focus on shareholder value. We retain a positive stance on Japan equities, thanks to reasonable valuations, increased shareholder returns, governance reform and structural reform. South Korea's 'value up' initiative is at an earlier stage but should have a similar impact on corporate governance there. Confidence in China's international competitiveness and continued ability to innovate was boosted in January 2025 by the release of the DeepSeek Large Language Model (LLM), which was developed at lower cost than similar LLMs from the US. China is already capitalising on advantages – such as rapid adoption of new technologies, a vast domestic market and an unrivalled manufacturing base – to lead in key industries including electric vehicles and renewable energy. Dynamic emerging economies In the emerging markets of South-east Asia where population is growing, technology adoption and mass consumption are underpinning domestic-driven growth to complement traditional strength in commodities and manufacturing. Recent weakness due to fears over the impact of US tariffs is providing good entry points for long-term opportunities that fit into our value-driven investment process. In contrast, India equities have been richly valued compared to Asian peers so we are being very selective and remain underweight on the country. Nevertheless, India is building on its economic momentum by extending its manufacturing base. Trade deals with the UK, and perhaps later in the year with the US, help. From the market peak in 2024, Indian equities have underperformed Asian peers. Combined with the recent tension with Pakistan, this has brought valuations to more reasonable levels, and investors can now gradually increase India exposure. Valuation gap will close Our conviction is that the enormous valuation gap between Asia-Pacific and the US will narrow in 2025 and beyond. It is crucial to focus on the fundamentals and take advantage of the volatility to identify medium-term alpha opportunities. We believe an active approach with a prudent stock selection process is the best way to build and hold long-term exposure to Asia-Pacific equities. The writer is head of Asia equities, Robeco
CNA
2 hours ago
- CNA
US senator moves to limit Trump's war powers on Iran, as Mideast conflict escalates
WASHINGTON: A Democratic senator introduced legislation on Monday (Jun 16) to prevent US President Donald Trump from using military force against Iran without Congress's authorisation, as an escalating battle between Israel and Iran raised fears of broader conflict. Tim Kaine of Virginia has tried for years to wrest back Congress's authority to declare war from the White House. During Trump's first term, in 2020, Kaine introduced a similar resolution to rein in Trump's ability to wage war against Iran. That measure passed both the Senate and House of Representatives, winning some Republican support, but did not garner enough votes to survive the Republican president's veto. Kaine said his latest war powers resolution underscores that the US Constitution gives Congress, not the president, the sole power to declare war and requires that any hostility with Iran be explicitly authorised by a declaration of war or specific authorisation for the use of military force. "It is not in our national security interest to get into a war with Iran unless that war is absolutely necessary to defend the United States. I am deeply concerned that the recent escalation of hostilities between Israel and Iran could quickly pull the United States into another endless conflict," Kaine said in a statement. Under US law, war powers resolutions are privileged, meaning that the Senate will be required to promptly consider and vote on the matter. Israel's military launched attacks on Iran on Friday with the stated aim of wiping out Iran's nuclear and ballistic missile programmes. Iran, which says its nuclear programme is for peaceful purposes, responded with missile attacks on Israel. Both countries have kept up their attacks, killing and wounding civilians and raising concern among world leaders meeting in Canada this week that the biggest battle between the two old enemies could lead to a broader regional conflict. Trump has lauded Israel's offensive while denying Iranian allegations that the US has taken part and warning Tehran not to widen its retaliation to include US targets. Before leaving for the summit in Canada on Sunday, Trump was asked what he was doing to de-escalate the situation. "I hope there's going to be a deal. I think it's time for a deal," he told reporters. "Sometimes they have to fight it out."
