A popular narrative — especially in Moscow — is that the G7 is increasingly irrelevant as BRICS rise
• Granted, the G7's share of global GDP has dropped from 61% in 1980 to 45% in 2024
• Yet the five BRICS countries accounted for just 25% of global GDP in 2024 - meaning narrative is misleading [9/9]
Second trap dodged: initial fears of Russia returning to the G7(/8) have proved unfounded
• G7 sanctions on Russia remain in place, with no indication that they could be relaxed any time soon
• This is welcome at a time when Moscow finds it increasingly difficult to finance the war in Ukraine [8/9]
Paris has managed to dodge two traps
• First, Trump has confirmed he'll attend Evian summit, although White House said it "won't produce actual signed deals"
• Keeping US engaged entailed quietly dropping climate change (or finding creative workarounds like "energy abundance"), though [7/9]
AI will also likely feature high on the agenda — the one topic Trump actively wants to discuss in Evian
• Yet what the G7 can concretely deliver beyond in practice remains unclear
• The two leading AI powers are the US and China, with not much space for other G7 economies to play driving role [6/9]
Another area of G7 focus has been fertilisers
• Conflict in Iran has trapped one-third of globally traded fertiliser supplies in Hormuz
• Yet top two producers and exporters are China & Russia, both outside the G7
• G7 will also not conclude with US promise to end war to boost food security [5/9]
Concretely, what to expect from Evian? Not really groundbreaking stuff
• G7 secretariat dedicated to critical minerals - a priority for all G7 members - is on the cards, hosted by OECD or IEA (conveniently both Paris-based)
• Details about missions & governance of such secretariat remain vague [4/9]
US, Japan, China and Germany account for two-thirds of global imbalances
• As with Draghi report, question is not what needs to be done, but political will to do so
• US: reduce fiscal deficit, ditch tariffs; EU: boost investment; China: redistribute to households
(None of this will happen) [3/9]
France's flagship G7 priority — tackling global imbalances — was a bold bet
• Reducing imbalances would require the US to curb consumption or investment, a non-starter for Washington
• Tackling imbalances without China is a quixotic endeavour; Beijing decries the G7 as gathering of old powers [2/9]
The Evian G7 summit will take place in just a few days - some thoughts about what's at stake, what to expect and what's next for G7 economies (yes, BRICS are rising, but the G7 is far from irrelevant) 👇 [🧵 A thread with graphs - 1/9]
Active and passive funds are probably going to have to fork out over $14bn for SpaceX stock simply because of the recent indexing fiddles. 👉 www.ft.com/content/d406...
