EXPLAINER: The G7 provides a forum for like-minded democracies

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ELMAU, Germany — In 1975, leaders of the world’s wealthy democracies came together to address an energy crisis triggered by a war and runaway inflation. These same pain points plague their successors representing 46% of the global economy this week. Group of Seven Summitwith high consumer and energy prices threatening to trigger recessions in the US and Europe.

Here are the key facts about the Group of Seven:


It is a group of wealthy democracies with large advanced economies and a high standard of living. Annual summits give leaders the opportunity to develop common approaches on just about anything what they want to talk about.

The early peaks of the 1970s were called to deal with the first post-World War II recession and focused on fiscal stimulus and exchange rates. Economic policy always tends to come to the fore. Energy, terrorism, the Cold War and the environment have been major themes in the band’s history.

The members are: Canada, France, Germany, Italy, Japan, United Kingdom and United States. Representatives of the European Union are also present.

In 1975, French President Valéry Giscard D’Estaing formally convened what was then a Group of Six outside Paris. The goal: to face a recession accompanied by high unemployment and inflation following the Arab oil embargo against the United States and other countries for supporting Israel during the Arab-Israeli war of 1973. Canada was invited the following year.


Their annual meetings offer leaders the opportunity to gauge each other and negotiate face-to-face on a wide range of issues involving all departments of their firm – the big picture.

The G-7 does not have a bureaucracy to carry out its decisions nor a permanent headquarters. The rotating host country takes care of the organization and the preparatory meetings. National governments are responsible for monitoring and implementation. The agreements do not have the force of law, but peer pressure plays a role in pushing governments to implement them.


Leaders meeting in the German state of Bavaria are looking for ways to help Ukraine defend itself against Russia and review sanctions aimed at limiting Russia’s ability to wage war.

One proposal is a Russian oil price cap that would reduce a key source of Kremlin revenue. But that has to be weighed against the economic impact, especially in Europe which is more dependent on Russian oil and gas.

It’s a tough juggle as fears grow of a recession in the US and Europe as central banks raise interest rates fight against inflation. The G-7 is also looking for ways to facilitate grain shipments out of Ukraine and ease inflation and global food shortages.


Membership is by invitation of existing members. The G-7 stands out because its members are all democracies. This contrasts with the broader Group of 20, which accounts for more than 80% of the global economy, but where like-minded democracies have to sit with a monarchy like Saudi Arabia and authoritarian governments like Russia and Turkey. China, as well as developing countries like Indonesia.

Russia previously belonged to the small group. He joined the G-8 in 1998 but was expelled after Moscow invaded and annexed Ukraine’s Crimean peninsula in 2014.

The G-7 invites invited countries to participate in certain summit sessions, and the 27 member countries of the European Union have a seat at the table thanks to the presence of the president of the council and the EU commission.


Projects initiated or pushed by the G-7 included debt relief for poor countries during the 1990s, managing relations with the Soviet Union, and trying to rally Russia to the West after the collapse of the Soviet Union, and the promotion of free trade, a global minimum corporate tax and efforts to combat climate change.

The G-7 has faced several criticisms over the years – for excluding developing economies and for its lack of a formal institutional structure. Anti-capitalist and anti-globalization activists are protesting the meetings as a club for the wealthy, while anti-poverty and environmental groups are urging leaders to do more in these areas.

Follow AP’s coverage of the Russian-Ukrainian War at https://apnews.com/hub/russia-ukraine

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