Garmisch Partenkirchen G7 Gipfel 2022 G7 Gipfel 2022, 28.06.2022, Garmisch Partenkirchen/Schloss Elmau, Deutschland G7 Summit 2022 in Garmisch Partenkirchen/Schloss Elmau, Germany on 2022/06/28 Buehne und Rednerpult fuer die Pressekonferenz von Olaf Scholz *** Garmisch Partenkirchen G7 Summit 2022 G7 Summit 2022, 28 06 2022, Garmisch Partenkirchen Schloss Elmau, Germany G7 Summit 2022 in Garmisch Partenkirchen Schloss Elmau, Germany on 2022 06 28 stage and lectern for the press conference of Olaf Scholz Copyright: xEibner-Pressefoto/RogerxBuerkex

A common signal should go out from Schloss Elmau, the venue of the most recent G7 summit, of strong democracies, fully aware of their global responsibility.

Ultimately, however, the opposite was the case: in the wake of Vladimir Putin’s war against Ukraine, the “community of leading democracies” tried in vain to include important emerging countries such as India, Indonesia and South Africa in their alliance against Russia.

With good reason, their political leaders avoided joining the Western sanctions against Moscow. With their well-intentioned but strategically short-sighted punitive measures, the Western states are not only damaging their own economies, but also the “rest of the world”, which the G7 often look down on from their supposedly higher, because democratic, perspective.

The fact that the democracy of the leading Western power, the USA in particular, has been severely damaged is being suppressed. The commission of inquiry into the storming of the Capitol is uncovering more and more troubling facts of militant Trumpism. The majority of the US population now fears that their democracy could soon be replaced by an autocracy.

As a reminder, on January 6, 2021, the mob instigated by loser Donald Trump even attempted the life of then-Vice President Mike Pence. In order to allow Trump a second term in office, Trump’s Republicans are currently manipulating the electoral law in the individual states without any constitutional scruples.

The former Grand Old Party is still under the spell of a man who calls the war criminal Putin a “genius”. In any case, it is anything but impossible for Trump to return to the White House after the 2024 presidential elections – especially since incumbent Biden is massively losing popular support.

The G7 summit in Quebec, Canada, at which Trump caused an uproar in 2018 with his exclusive demand to include Russia back in the club of the most important industrialized countries, has also been largely forgotten.

During the US election campaign, he had already demanded incriminating material from Ukrainian President Volodymyr Zelenskyj against his challenger Biden and his son Hunter. Hunter was on the payroll of Ukraine’s gas company Burisma, even though his father was Vice President in charge of the Ukraine dossier during Barack Obama’s administration. Without incriminating evidence, Trump’s undisguised threat was that the United States, under his leadership, would scale back military aid to Ukraine.

Against this background, it is to be welcomed that the German G7 Presidency intends to coordinate the measures to support Ukraine in close cooperation with its allies. But this also includes far-reaching financial and economic sanctions against Russia that fail to have the intended effect – changing Putin’s behavior or changing the regime in Moscow.

While all G7 countries, i.e. Germany, France, Italy, Japan, Canada, Great Britain and the USA, have implemented economic sanctions against Russia, a number of countries in the “Global South” are resisting because they simply accept these punitive measures can not afford.

This applies, for example, to Argentina, Brazil, China, India, Indonesia, Mexico, Saudi Arabia, South Africa and Turkey. In any case, it is no coincidence that the states that support sanctions are rich countries.

There is also another aspect: in the major geopolitical conflict of our time, the USA and China are using the economy as a weapon in order to achieve their strategic goals. The supply chains further disrupted by Russia’s aggression against Ukraine point to an accelerated process of deglobalization. Because economic interdependence makes vulnerable, Germany can sing a song about it because of its gas dependency on Russia.

That’s why “resilience” is now a popular buzzword – at the expense of efficiency, such as internationally networked “just-in-time” production. This “friendshoring”, “nearshoring” or “reshoring” means: Western companies are relocating their production back home instead of relying on Russian or Chinese suppliers.

This is likely to have serious consequences for Germany and Europe. The consequences of decoupling in the short and medium term could already be seen during the Corona crisis. When there were no containers from China at the beginning of the pandemic, important basic materials and everyday products were quickly missing.

After the economy started to pick up again, the still disrupted supply chains caused significant supply problems – and drove inflation to levels not seen for a long time.

If the Western economies were to continue to disengage themselves from China, as Washington would have it, this would fuel the spiral of inflation – playing with fire, which would not be in Europe’s interests.

The West’s sanctions front against Russia is also beginning to crumble, because it is becoming increasingly clear that economic weapons are double-edged swords. The oil embargo against Russia, which is already full of holes, has the macabre effect, in view of the price increases it has caused, that not less, but more money is flowing into the Russian state budget than before. At the same time, the sanctions threaten the prosperity of Western societies.

US Treasury Secretary Janet Yellen is now even advising Europeans not to completely boycott Russian oil supplies, out of their own interest. Because the higher oil prices are fueling inflation and forcing the US Federal Reserve to adopt an increasingly restrictive monetary policy, which in turn is likely to lead to further slumps on the US stock markets and the US economy.

However, the emerging and developing countries are much more affected by the sanctions policy and its consequences than Western economies. This applies in particular to those states that have borrowed in US currency. You are already threatened with serious payment difficulties because of the rise in the dollar exchange rate.

In addition, the emerging and developing countries must fear that the more restrictive monetary policies of western central banks will result in a massive outflow of investment funds. In any case, the danger of simultaneous growth, energy, food and debt crises is more than worrying for many countries.

Against this background, the refusal of India, Indonesia and South Africa to join the Western sanctions is only logical. Seen in this way, despite all the noble rhetoric, the most recent G7 summit at Schloss Elmau could not send out a common signal from strong democracies.