G7, with Canada's backing, issues stern warning to China over its support for Russia and unfair trade practices

Leaders from the Group of Seven (G7) concluded their summit with a direct and forceful message for Beijing, warning of significant consequences if it continues to support Russia's war effort in Ukraine and engage in what the bloc describes as harmful economic practices. Canada, represented by Prime Minister Justin Trudeau, stood firmly with its allies in delivering the strongly-worded communiqué, marking a new peak in coordinated pressure on China.

The primary focus of the warning was China's role in sustaining Russia's military-industrial complex. G7 leaders expressed "deep concern" over Beijing's transfer of dual-use materials and components, which they assert are being used by Moscow to reconstitute its defense sector. While China is not directly supplying lethal weapons, the provision of items like microelectronics, machine tools, and other industrial goods allows Russia to bypass Western sanctions and continue its aggression against Ukraine. The statement called on China to "cease the transfer of dual-use materials... as it is prolonging the conflict and threatening international peace and security."

Prime Minister Trudeau emphasized Canada's alignment with this position, stating that enabling Russia's war is unacceptable. "We are united in our message to President Xi: stop supporting Russia's war of aggression," Trudeau remarked during a press conference. "The G7 will not stand by while any country fuels this illegal conflict. We are prepared to take further measures to counter this activity." This united front represents a critical development, as detailed in recent reports on how G7 leaders, including Canada, confront China on support for Russia and unfair economic practices.

Economic Tensions and Industrial Overcapacity

Beyond security concerns, the G7 leaders addressed China's economic policies, particularly its state-driven industrial overcapacity. The communiqué highlighted non-market policies and practices that lead to "harmful overcapacity" in sectors such as electric vehicles (EVs), solar panels, and semiconductors. This flood of low-cost, state-subsidized goods, the G7 argues, undermines fair competition, threatens industries in member countries, and creates risky dependencies in global supply chains.

For Canada, this issue is particularly salient. The Canadian automotive sector is in the midst of a massive transition to EV production, supported by significant federal and provincial investments. The prospect of a market flooded with inexpensive Chinese EVs poses a direct threat to the viability of this nascent industry. Similarly, Canadian clean technology companies face stiff competition from Chinese firms that benefit from state support. The G7's statement signals a collective intent to protect their domestic industries, with leaders agreeing to "monitor the negative impacts of overcapacity" and consider steps to "ensure a level playing field."

The summit's focus on these dual threats—security and economic—underscores a comprehensive and increasingly assertive strategy toward Beijing. The explicit linkage between China's support for Russia and its trade practices suggests the G7 sees them as two sides of the same coin: a challenge to the rules-based international order. The message from the summit was clear, as G7 leaders, including Trudeau, issue a stern warning to China over Russia support and trade practices, indicating that patience with Beijing is wearing thin.

China's Reaction and the Path Forward

Beijing was swift to condemn the G7's statement, dismissing it as "full of arrogance, prejudice and lies." A spokesperson for the Chinese Foreign Ministry accused the bloc of using China as a scapegoat for its own economic problems and of engaging in protectionism. China maintains that its trade with Russia is normal economic cooperation and denies providing military assistance. It has consistently framed the G7's actions as an attempt to contain its economic and technological rise.

Despite China's denials, the G7 appears poised to act. The communiqué did not specify the exact nature of potential future sanctions or trade measures, but officials have hinted at targeting Chinese financial institutions and companies directly involved in supplying Russia's defense industry. The United States has already imposed some sanctions on Chinese firms for this reason, and the G7's unified stance suggests that European nations and Canada may soon follow suit with more robust measures.

For Canada, navigating this complex relationship remains a delicate balancing act. China is a vital trading partner, but its actions on the world stage present direct challenges to Canadian interests and values. The Trudeau government's participation in the G7's hardline stance signals a prioritization of collective security and economic fairness, even at the risk of economic retaliation from Beijing. The coming months will be crucial in determining whether the G7's warning leads to a change in Chinese policy or an escalation in geopolitical and economic tensions.