The Group of 20 (G20) held a U.S.-led meeting of finance ministers over two days from the 31st to the 1st (local time) but failed to issue a joint statement. Nineteen members, including the United States, agreed on a joint statement, but China alone rejected it over a specific word, leaving the meeting split 19-1.
The Financial Times (FT) reported on the 1st (local time), citing U.S. and European officials, that China broke the consensus on a joint statement at this year's G20 finance ministers' meeting. The other members, excluding China, decided to issue a "chair's statement" instead of a joint statement. U.S. Treasury Secretary Scott Bessent told reporters on the 1st, "We hoped to be able to issue a unanimous joint statement today." He added that the fact that the remaining 19 countries, excluding China, signed on "shows strong cohesion."
The G20 is a forum of 19 countries plus the European Union (EU) and the African Union (AU), accounting for 85% of global gross domestic product (GDP) and 75% of trade. FT reported that China pushed back to the end against the phrase in the joint statement calling to eliminate "non-market policies." Non-market policies refer to a method in which the state nurtures specific industries with subsidies and low-interest loans and encourages the export of products at prices below cost. The United States and the EU view China's global push to export low-priced products as stemming from excess production in China. According to EU figures, China's trade surplus with the EU swelled to 360 billion euros (about 572 trillion won) last year. That amount is equivalent to 60% of the $709.7 billion Korea earned from exports last year.
The wording China took issue with was not limited to trade imbalances. China also objected to a passage calling on G20 members to keep supply chains for energy, food, fertilizer and critical minerals running smoothly. In diplomatic documents, the phrase "keep supply chains running smoothly" is close to a pledge not to block exports for political reasons. Starting in 2023 with gallium and germanium, semiconductor materials, China placed exports of graphite, antimony and tungsten—types of rare earths—under a licensing regime in succession. In Oct. last year, it issued a rule requiring Chinese government approval even for foreign products containing even trace amounts of Chinese rare earths. FT reported that China demanded that the word "critical minerals" itself not be included in the joint statement.
China also opposed language to ensure predictable navigation in the Strait of Hormuz. According to FT, China argued that the logic of the international community jointly guaranteeing passage through a specific strait could be applied as is to the Taiwan Strait and the South China Sea. China currently claims sovereignty over both waters. A senior U.S. official said, "In the end, it was a matter of a few words," adding, "China, as always, tries to slow things down and tweak the terminology bit by bit. If we cannot agree even on the words, we will not be able to implement any actions."
On the very day China rejected a joint statement at the U.S.-led G20 meeting, Chinese President Xi Jinping took the opposite diplomatic course in Bishkek, the capital of Kyrgyzstan. On the 31st, Xi stood alongside Russian President Vladimir Putin and Iranian President Masoud Pezeshkian at the Shanghai Cooperation Organization (SCO) summit.
The SCO is a forum created in 2001 by China and Russia to address Central Asian border issues. It has now expanded to 10 members, including India, Pakistan, Iran and Belarus. Combined, the member states have a population of 3.4 billion, or 40% of the world's population, but their share of global GDP is 25%, about one-third that of the G20.
The New York Times (NYT) on the 1st compared the two meetings and called it "a screen partitioning over who gets to set the next phase of the world order." The members on the 1st adopted the "Bishkek Declaration," which calls for a multipolar order and a stronger role for the UN, and described the SCO as a practical forum with a non-military character.
President Putin called the SCO "one of the independent and influential centers of the emerging multipolar world" at the meeting. He separately met President Pezeshkian and praised the Iranian people's "courage and resilience," saying, "We are supplying the necessary goods in this difficult time." Xi told Putin, "The foundation of China-Russia relations will only grow stronger."
Ryan Hass, a senior fellow at the Brookings Institution, told the NYT, "China is pursuing a strategy of securing support from the global majority of countries to steer the international political order in the direction it wants." Hass, who served at the U.S. State Department and the White House National Security Council, added, "The fact that Xi attends such gatherings in person shows how important they are to China."
Zhou Bo, a Tsinghua University researcher and former colonel in the People's Liberation Army, told the NYT, "The SCO is not provocative because it is not based on a military alliance," adding, "That is why each country accepts and participates without burden." He added, "The more the United States steps back and the world becomes multipolar, the more countries will choose practical forums with fewer conditions," and "Every country is spreading out its risk factors."
The two meetings were held in tandem ahead of a U.S.-China summit in Washington at the end of this month. Despite agreeing to a trade truce in Oct. last year, the Trump administration blocked imports of Chinese robots and expanded sanctions on Chinese corporations buying Iranian crude. The U.S. State Department is preparing to send warning letters to dozens of countries that if they join China-led artificial intelligence (AI) initiatives, they will be excluded from the U.S.-led coalition "Pax Silica."
Wu Xinbo, director of the Center for American Studies at Fudan University and an adviser to the Ministry of Foreign Affairs, told the NYT, "China is pursuing two goals: rallying other countries' consent so the United States cannot set the agenda alone, and taking a more proactive role in driving the world economy."