Why Should We Care About the G7? What This Weekend's Summit in Canada Means for Australia
As world leaders gather in the Canadian Rockies, here's why every Australian should be paying attention
Something significant is happening in the mountains of Alberta, Canada, right now. From June 15-17 (Canadian Time), the leaders of the world's seven largest advanced economies are meeting for the 51st G7 Summit in Kananaskis, and what happens there could reshape Australia's economic and strategic future.
What Exactly is the G7?
The Group of Seven might sound like an exclusive club – and in many ways, it is. Comprising the United States, United Kingdom, Germany, France, Italy, Japan, and Canada, the G7 represents about 40% of global GDP and has been the primary forum for economic coordination among the world's largest democracies since 1975.
While Australia isn't a member, we're what diplomats call a "natural partner," often invited to participate in discussions and deeply affected by the decisions made around that table. Prime Minister Anthony Albanese is in attendance at this week’s summit.
Why This Summit Matters More Than Usual
This isn't your typical diplomatic gathering. Several factors make the 2025 Canadian summit particularly consequential for Australia:
Trump's Return to the Stage: This marks Donald Trump's first G7 appearance since 2019, and early signs suggest he's bringing his confrontational trade agenda with him. The President, who once called Australia's trade relationship "not fair", is now wielding tariffs as his primary diplomatic weapon, creating uncertainty for our export-dependent economy.
New Faces, Old Challenges: The summit features several leaders attending their first G7 meeting, including British PM Keir Starmer, Canadian PM Mark Carney, Japanese PM Shigeru Ishiba, and German Chancellor Friedrich Merz. This changing of the guard comes at a time when global unity is being tested.
Economic Turbulence: With trade tensions escalating and economic nationalism on the rise, the G7's traditional role as a stabilising force in global economics is under pressure. For Australia, which relies heavily on international trade, the outcomes here will directly impact our prosperity.
The Australian Connection
Australia's absence from the G7 table doesn't mean we're absent from G7 consequences. Here's how the summit's decisions will ripple down to us:
Trade and Economy: As one of the world's most trade-exposed economies, Australia is particularly vulnerable to shifts in G7 trade policy. The leaders meeting in Canada will discuss everything from digital taxation to supply chain security – issues that directly affect our mining exports, agricultural products, and services sector.
Security and Defence: The G7 increasingly functions as a security alliance, not just an economic forum. With growing tensions in the Indo-Pacific region, Australia often finds itself implementing policies that align with G7 positions on China, regional security, and defence technology sharing.
Climate and Energy: As a major energy exporter undergoing an energy transition, Australia watches G7 climate commitments closely. These summits often set the tone for global climate policy, affecting everything from our coal exports to renewable energy investments.
What's at Stake This Weekend
Several key issues on the G7 agenda will have direct implications for Australia:
Digital Economy and AI Governance: As artificial intelligence reshapes the global economy, the G7's approach to AI regulation and digital trade rules will influence Australia's tech sector and our position in the global digital economy.
Supply Chain Resilience: Post-pandemic supply chain security has become a G7 priority, with implications for Australia's role as a reliable supplier of critical minerals and resources.
China Strategy: While not always explicitly stated, the G7's approach to China fundamentally shapes the strategic environment in which Australia operates. The summit's outcomes will influence how democratic allies coordinate their China policies.
The Wildcard Factor
This summit carries particular uncertainty because of President Trump's unpredictable approach to traditional alliances. His "America First" agenda and willingness to use tariffs against allies creates a challenging environment for consensus-building, something the G7 traditionally relies upon.
For Australia, this matters because our security relationship with the United States and our economic relationships with other G7 members sometimes pull in different directions. A fractured G7 could force Australia into difficult choices between economic and security priorities.
Why Every Australian Should Care
The G7 might seem like a distant talking shop, but its decisions affect ordinary Australians in concrete ways:
Your job security: Trade disputes affect employment in export industries
Your cost of living: Global economic instability drives inflation
Your super fund: Market volatility impacts retirement savings
Your children's future: Climate and technology policies shape long-term prospects
Looking Ahead
As the Kananaskis summit unfolds, Australian policymakers will be watching closely for signals about the future direction of the global economy and democratic cooperation. The outcomes will influence everything from our trade negotiations to our defence planning.
The G7 was created fifty years ago to manage economic crises and coordinate responses among like-minded democracies. Today, as those democracies face internal divisions and external pressures, the summit's success or failure will help determine whether the rules-based international order that has served Australia so well can adapt to 21st-century challenges.
So while we may not be a member of the G7, we certainly have skin in the game, and our Prime Minister will be there. The conversations happening in the Canadian Rockies this weekend will echo through Australian boardrooms, parliament, and eventually, our daily lives.
The G7 matters because in an interconnected world, Australia's fate is tied to the decisions made by the world's most powerful democracies – whether we're in the room or not.