G7 leaders meet amid fear of a global trade war

Leaders of the Group of Seven rich nations meet at a summit in Canada on Friday more divided than at any time in the group’s 42-year history, as US President Donald Trump’s policies risk causing a global trade war.

In a bid to rebuild America’s industry, Trump has imposed hefty tariffs on steel and aluminum imports, including those from key G7 allies like Canada, Japan and the European Union.

The summit is being held in the picturesque Quebec town.

Trump and other world leaders don't agree on a wide range of issues from trade to the environment as well as Iran and the construction of a new US embassy in Jerusalem.

The US president signaled that he was in no mood to compromise as he met Japanese Prime Minister Shinzo Abe.

Fragile friendships

Pleas by the G7 member countries for exemptions from the US steel and aluminum tariffs, which went into effect on June 1, have fallen on deaf ears in Washington.

The US president has frosty relations with Canadian Prime Minister Justin Trudeau, the summit host.

“We will also obviously have some very robust discussions on trade,” Trudeau said.

The Canadian leader is embroiled in rows with Washington over steel and aluminum and negotiations over the North American Free Trade Agreement.

French leader Emmanuel Macron stressed however that the US was no longer the sole economic superpower in the world and urged other industrialised countries to stick together.

His plea for unity may fall, even within the EU as its members scramble to safeguard their own industries. 

Germany has suggested making accommodations over trade with the US for fear of triggering a ratcheting up of tensions over cars that would embroil companies like BMW and Mercedes.

Europe faces renewed domestic economic and political challenges in addition to those posed by Trump’s unilateralism.

Japan is also expected to take a less confrontational approach than its G7 peers, while still quietly pressing its case on trade.

Despite the lobbying and pleas, Trump has pressed ahead with tariffs as well as pulling out of the Paris climate accord. 

Intense diplomacy from Europe to save an international nuclear agreement with Iran also failed.

Trump has threatened to impose tariffs on car imports - something which can be damaging for Europe's economy.