What Is the Group of Seven (G-7)?
The Group of Seven (G-7) is an intergovernmental organization made up of the world's largest developed economies: France, Germany, Italy, Japan, the United States, the United Kingdom, and Canada. Government leaders of these countries meet periodically to address international economic and monetary issues, with each member taking over the presidency on a rotating basis.
The G-7 was, for a while, known as the Group of Eight (G-8), until 2014 when former member Russia was removed after annexing the region of Crimea illegally from Ukraine. The European Union (EU) is sometimes considered to be a de-facto eighth member of the G-7 since it holds all the rights and responsibilities of full members except to chair orhost meetings.
Key Takeaways
- The Group of Seven (G-7) is an intergovernmental organization that meets periodically to address international economic and monetary issues.
- G-7 countries consist of the U.S., U.K., France, Germany, Italy, Canada, and Japan.
- The G-7 was formerly referred to as the G-8 until Russia was suspended from the group in 2014 after illegally annexing Crimea.
- The G-7 is not an official, formal entity and, therefore, has no legislative or authoritative power to enforce the recommended policies and plans it compiles.
How the Group of Seven (G-7) Works
The major purpose of the G-7 is to discuss and sometimes act in concert to help resolve global problems, with a special focus on economic issues. Since its inception in the early 1970s, the group has discussed financial crises, monetary systems, and major world crises,such as oil shortages.
The G-7 has also launched initiatives to fund issues and relieve crises where it sees an opportunity for joint action. Those efforts include several aimed at debt relief for developing nations.
In 1996, working with the World Bank, the G-7 launched an initiative for the 42heavily indebted poor countries(HIPC), along with a Multilateral Debt Relief Initiative (MDRI), a 2005 pledge to cancel the International Development Association debt of countries that have gone through the MDRI program.
$300 million
The amount of money the G-7 provided in 1997 to help build the containment of the reactor meltdown at Chernobyl.
In 1999, the group also decided to get more directly involved in "managing the international monetary system" by creating theFinancial Stability Forum (FSB). The FSB is made up of major national financial authorities, such asfinance ministers,central bankers, and international financial bodies.
History of the Group of Seven (G-7)
The origins of the group date back to the early 1970s, when leaders of the U.S., U.K., France, West Germany, and Japan met informally in Paris to discuss the thenrecessionand oil crisis. That, in turn, inspired French President Valéry Giscard d’Estaing to invite the leaders ofthose countries, plus Italy, to Rambouillet in 1975 for further discussions on global oil, this time with the country's leaders joining the finance ministers—an attendance roster that has endured. The next year, Canada was invited to join the group.
The host of the G7 summit, also known as the presidency, rotates annually among member countries in the following order: France, United States, United Kingdom, Germany, Japan, Italy, and Canada.
Expansion to G-8
The G-7 has responded as the global economy has evolved, including when the Soviet Union pledged to create an economy with freer markets and held its first direct presidential election in 1991. Following a 1994 G-7 meeting in Naples, President Boris Yeltsin held meetings with G-7 member countries, in what became known as the P-8 (Political 8). In 1998, after urging from leaders including U.S. President Bill Clinton, Russia was added to the G-7 as a full member, creating a formal Group of Eight, or G-8.
The G-8 ended up being short-lived. In 2014, Russia was suspended from the group after the annexation of Crimea and tensions in Ukraine. As of 2021, Russia has not been invited back to the G-7.
The Group of Seven (G-7) vs. the Group of 20 (G-20)
As developing nations began to represent a larger part of the global economy, the absence of a forum about international financial matters that included those emerging economies became more glaring.
In response, the Group of 20 (G-20) was created in 1999, comprising all the members of the G-7, plus 12 additional countries and the EU. As the economies and trade activity of marketssuch as China, Brazil, India, Mexico, and South Africa—all G-20 members—surge, many observers now see the G-20 as usurping much of the role and eminence once held by the G-7.
2021 G7 Summit
From June 11 to June 13, 2021, the G7 met in Cornwall, England. According to statements released from the group, many of the discussions at the 2021 summit focused on two distinct issues: the ongoing coronavirus pandemic and the climate crisis. The G7 committed to distributing 1 billion vaccine doses over the next 12 months.
In response to the climate crisis, the group committed to the following actions: achieving net-zero carbon emissions by 2050, limiting the increase in global temperatures to 1.5 degrees, increasing and improving climate finance, and conserving at least 30% of our land and oceans by 2030.
FAQs
The G7 is an informal bloc of industrialized democracies—the United States, Canada, France, Germany, Italy, Japan, and the United Kingdom (UK)—that meets annually to discuss issues such as global economic governance, international security, and, most recently, artificial intelligence (AI).
What is the work of G7 countries? ›
At these summits the G7Group of 7, seven major industrial countries heads of state and government discuss key global policy issues, exchange views and work together to develop constructive solutions.
What is the group of seven member countries? ›
The Group of Seven (G7) is an informal grouping of seven of the world's advanced economies, including Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States, as well as the European Union.
Why was Russia removed from G7? ›
In March 2014 Russia was suspended indefinitely following the annexation of Crimea, whereupon the political forum name reverted to G7.
Which of the following describes correctly the group of seven countries G7? ›
The Group of 7 is a group consisting of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States. These countries, with the 7 largest advanced economies in the world, represent more than 62% of the global net wealth. They are industrialised economies.
How does the G7 work? ›
The G7 is an informal bloc of industrialized democracies—the United States, Canada, France, Germany, Italy, Japan, and the United Kingdom (UK)—that meets annually to discuss issues such as global economic governance, international security, and, most recently, artificial intelligence (AI).
Is G7 for the richest countries? ›
The G7 countries have together a population of about 780 million people (or almost 10% of the world population) and comprise around 50% of worldwide nominal net wealth.
Why is China not in the G7? ›
Is China a part of the G7? No, China is one of the biggest economies in the world but due to its low nominal GDP and non-liberal democracy, it is not included in the G7.
Who is the chairman of the G7? ›
The leader who has been in office the longest of the seven leaders is considered the Senior G7 leader; currently Justin Trudeau since December 2021. While the current G7 consists of seven nations, it didn't always. The group was formed as the Group of Six, G6, including all of today's members minus Canada.
Why was G7 created? ›
The G7 was born as a result of the huge economic problems facing the world in the 1970s. The first oil shock and the collapse of the Bretton Woods fixed exchange rate system had the world on tenterhooks. These were grounds enough for the heads of state and government to consult on international economic policy.
The G8, the Group of 8 is made up of Canada, France, Germany, Italy, Japan, Russia, the USA and the UK. The European Union is represented by the President of the European Commission, and the President of the European Council.
What is the difference between G7 and G20? ›
The G20 has similar aims to the G7 but includes an additional 13 members to reflect the growing economic importance of countries such as Brazil, India, and Indonesia.
Why is Sweden not in G7? ›
A country with 10 million citizens not have an economy big enough to get a place in the G7 group. If the five Nordic countries of Sweden, Denmark, Norway, Finland and Iceland were considered as one economic entity, the Nordic countries combined could possibly have claim for a place in G7.
Which country is not part of the G7? ›
The correct answer is India. It is an intergovernmental organization that was formed in 1975. The bloc meets annually to discuss issues of common interest like global economic governance, international security, and energy policy. The G7 countries are the UK, Canada, France, Germany, Italy, Japan, and the US.
Is the G7 the organization of nation? ›
The G7 (Group of Seven) is an organisation of the world's seven largest so-called "advanced" economies, which dominate global trade and the international financial system. They are Canada, France, Germany, Italy, Japan, the UK and the United States.
What countries are in the G7 alliance? ›
The G-7, which includes Canada, France, Germany, Italy, Japan, the United Kingdom and the United States, has met regularly since the mid-1980s at the finance minister and central bank governor level.
What is the role of G7 and G20? ›
Summits or meetings of the leaders of the G7 / G20 countries offer the opportunity for the US and other group members to develop closer economic ties to expand trade. In addition, it allows the US another forum to discuss issues of global concern such as: environmental issues. terrorism.
Why is China not in G7? ›
Is China a part of the G7? No, China is one of the biggest economies in the world but due to its low nominal GDP and non-liberal democracy, it is not included in the G7.
What is the difference between G7 and G8 countries? ›
Russia began to engage in separate meetings with G7 leaders in 1994 and formally joined the group in 1997 at the invitation of U.S. President Bill Clinton and U.K. Prime Minister Tony Blair. The group then became the Group of Eight (G8) as it is known today. The G8 Presidency rotates among the members annually.
What do the G8 countries do? ›
The Group of Eight (G8) refers to the group of eight highly industrialized nations—France, Germany, Italy, the United Kingdom, Japan, the United States, Canada, and Russia—that hold an annual meeting to foster consensus on global issues like economic growth and crisis management, global security, energy, and terrorism.
