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In Germany, a G7 to try to cushion the shocks of the war in Ukraine

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German Chancellor Olaf Scholz has been receiving his G7 counterparts for three days since Sunday June 26 in a Bavarian castle in Elmau. On the menu of this summit of Heads of State and Government is above all a question: how to continue to put pressure on Russia while limiting the disturbances which could contaminate all the economies of the world, due to the rise in the prices of energy and food? First subject: the United States would like to prevent Russia from taking advantage of soaring oil prices, and to do so set a maximum purchase price for Russian oil, beyond which the buying countries would be liable to suffer sanctions. This proposal will be at the heart of future discussions in Elmau, but the Europeans are reserved.

Limit the effect of speculation

“The European Union has already taken the decision to ban 93% of Russian oil purchases, observes the Elysée. Our objective is to move towards a non-purchase of Russian oil, but also to limit the surge in all prices, so what would be much more powerful for us is to set a maximum price oil from all countries. »

France thus wishes to launch a discussion with all the producing countries so that they accept “a proactive policy to hold prices” by limiting the speculative boom that the market is currently experiencing.

Despite these differences of opinion, the objective for all the G7 countries remains the same: to prevent Moscow from imposing its version of the facts about the current surge in crude oil prices. “Russia says economic disruption comes from sanctions. But that is false, they come first of all from the war”, recalls the French presidency.

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Towards an Alliance for Food Security

The question is exactly the same with regard to cereals: the prices of foodstuffs are now experiencing a sharp rise, due to the blocking of Ukrainian exports and Russian bombardments, which have targeted several grain storage silos in Ukraine. The G7 heads of state are looking for answers to limit the consequences for African countries, some of which are very dependent on imports.

The German presidency of the G7 has therefore proposed to launch an Alliance for food security, on the model of what has been done for the sharing of vaccines. Moscow uses hunger “deliberately as a weapon of war” and take “the whole world hostage”, denounced German Foreign Minister Annalena Baerbock on the eve of the G7 summit. Berlin wants to create a platform that will buy wheat and supply it to the countries that need it most. This alliance could also fund longer-term action to develop subsistence agriculture in the countries most dependent on imports. And France is also pushing for discussions with grain traders, so that they limit the effects of upward speculation.

All of these proposals aim to demonstrate that the developed countries can remain a driving force. Since it embarked on the invasion of Ukraine, Russia has repeatedly asserted that their role is no longer decisive in a world where they are competing with new emerging powers.

Emerging countries invited

Faced with this challenge, the Heads of State and Government of the G7 will have to prove that they can provide concrete responses to the problems of the world and unite beyond their traditional allies. This is why the leaders of Indonesia, India, Senegal, South Africa and Argentina are also invited to this summit. With these countries will be discussed in particular a Partnership for infrastructures, which aims to invest in the development of emerging countries, by offering an alternative to Chinese financing set up within the framework of the “new silk roads”. “We aim to mobilize $600 billion by 2027 for global infrastructure investment”the White House said shortly before Joe Biden’s speech at Elmau.

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Another subject not on the official menu of discussions: the acceleration of the delivery of arms to Ukraine. Ukrainian President Volodymyr Zelensky, who will intervene by videoconference at the G7, is asking the developed countries to do so, in order to arrive at “the parity of fire” with Russia. The question is already the subject of consultation between allies. By inviting the Ukrainian President to speak, the Forum of Heads of State and Government aims in any case to show his support.

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US supports embargo on Russian gold

US President Joe Biden arrived at the G7 summit with a proposal to strengthen sanctions against Moscow: he wants developed countries to impose an embargo on Russian gold purchases. Russia is indeed a major producing country. Its gold exports represented nearly 15 billion euros in 2021, or 5% of the world market. It is the second source of foreign currency for Russia, after energy. The proposal has the support of the British, Japanese and Canadians, but must still be approved by the members of the G7 who belong to the European Union (France, Germany, Italy), because the sanctions, for them, are decided at 27 .

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