Prof. Syed Munir Khasru
Australian Institute of International Affairs
July 4, 2025
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The 2025 G7 Summit was overshadowed by war, wildfires, and walkouts—most notably President Trump’s abrupt exit before launching strikes on Iran. What was meant to be a forum for unity on trade, energy, and climate instead exposed the deep fractures defining today’s global order.
It has been 50 years since the G7 was launched on 15 November 1975 in Rambouillet, France, with six members (as Canada joined a year later). The G7 summit 2025 held in 16-17 June in Alberta, Canada, was overtaken by the Israel-Iran conflict over the initial focus on global economic stability, energy security, critical mineral supply chains and the Ukraine-Russia war. Six members of the G7 had their fingers crossed speculating what their person of interest, i.e., US President Trump, would bring to the table.
Now that President Trump has declared a ceasefire between Iran and Israel after the US became directly engaged by dropping bunker buster bombs in three Iranian nuclear sites on 22 June 22, 2025, the complexity of the Iran-Israel conflict is not over yet as it is not clear what lies ahead. Although President Trump had thanked Iran for telegraphing to the US ahead of time the largely symbolic missile attack on US military bases in Qatar, larger issues like “regime change” or the fate of a negotiated nuclear deal with Iran is still up in the air.
Trump subsequently declared a ceasefire between Iran and Israel. However, what lies ahead is far from certain. Iran’s largely symbolic missile response on US military bases in Qatar thankfully did not call for a larger US response. However its threat to block the Strait of Hormuz, a crucial oil transit chokepoint responsible for about 20 percent of the world’s oil trade, could cause oil prices to skyrocket, and destabilise the global economy. Other issues like “regime change” or the fate of a negotiated nuclear deal with Iran is still up in the air.
There are differing views among the G7 an dlike-minded partners about how to manage the situation, including Israel’s increasingly aggressive military activities. Japan’s position on the Israel-Iran conflict is as a mediator, emphasising its “long-standing diplomatic relations with Iran” while describing Israel as “a friendly nation.” Recently, the UK, Australia, and Canada sanctioned right-wing Israeli ministers Itamar Ben-Gvir and Bezalel Smotrich with asset freezes and travel bans for inciting violence against Palestinians and supporting West Bank settlement expansion. France is leaning towards a two-state solution and has been pushing European countries, including the UK, to recognise Palestinian statehood.
At the G7 summit, Ukraine received new aid from Canada, but no strong joint G7 statement or US arms support. Rather Trump suggested that Russia’s expulsion from the G8 in 2014 was a mistake which further complicated discussions with other leaders about Russia’s role on the international stage, especially in light of the ongoing war in Ukraine. His abrupt departure meant missing a much-anticipated meeting with Ukrainian President Volodymyr Zelensky. The G7 was expected to discuss further sanctions on Russia, but US reluctance to impose harsher economic measures complicates the issue. Despite this, the UK and EU are proceeding with their own plans to apply more pressure on Russia, including sanctions and price caps on oil import from Russia.
The leaders could not let the trade issue slide given Trump’s sweeping tariffs on nearly every G7 nation, including a ten percent tariff on most imports, and threatening larger tariffs on countries with trade surpluses against the US. The initial core agenda of the summit was for six countries to negotiate with the US—a task complex and multifaceted in nature, given each country’s agenda catering to its best interests.
President Trump unveiled a new trade deal with Keir Starmer, aimed at avoiding further tariffs between the US and UK. Although Trump held discussions with German Chancellor Friedrich Merz, French President Emmanuel Macron, European Commission President Ursula von der Leyen, and European Council President António Costa, they yielded no concrete results on tariffs, and there was little indication that Trump would soften his stance. Despite months of negotiations, Japanese Prime Minister Shigeru Ishiba also failed to reach a trade deal with Trump.
Given that Trump has promised deals by his own 9 July deadline, marking the end of a 90-day pause on his “Liberation Day” tariffs, ongoing blanket tariffs remain, risking the broader global disruption of supply chains. This inadvertently strengthens China’s position in the global economy.
Despite the backdrop of devastating wildfires in Canada and severe weather impacts worldwide, the summit statements failed to include any mention of climate change, let alone ambitious policy reforms to tackle the climate crisis. Unlike previous summits, absence of ministerial meetings on energy and the environment was disconcerting, and it has left the G7 arriving at COP30 in Brazil without concrete climate commitments.
The G7 Summit 2025 is symbolic of the fractured state of international diplomacy, where the leaders issued a joint statement urging de-escalation of hostilities in the Middle East but stopped short of calling for a ceasefire between Israel and Iran, though they did call for a ceasefire in the Israel-Gaza conflict. The decision by Prime Minister Mark Carney to abandon the traditional comprehensive joint communique is an acknowledgment that President Trump’s presence had made unified G7 positions quite tricky to achieve. That does not take away from the fact that as some of the most powerful economies, the G7 still has an important role to play to save the world from man-made catastrophes, while also being a unifier for an increasingly fractured and polarised world.
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