G-7 can still pack a punch

The leaders of the Group of Seven nations gathering in Italy have all suffered political setbacks and are striving to prove their forum is still relevant. [View in browser]( [Bloomberg]( Welcome to Balance of Power, bringing you the latest in global politics. If you haven’t yet, sign up [here](. The leaders of the Group of Seven nations gathering today at the Italian luxury resort of Borgo Egnazia appear like the walking wounded. Apart from the host, Prime Minister Giorgia Meloni, they’ve all suffered recent political setbacks or are in danger of doing so. UK Prime Minister Rishi Sunak will probably be out of office after a July 4 election, and Joe Biden is in a bruising fight for the US presidency with his predecessor, Donald Trump. France’s Emmanuel Macron has been [forced to deny rumors]( he’s ready to quit as president after a snap legislative election [he didn’t need to call]( for next month. The wealthy club is also wrestling with key economic challenges: aging workforces, soaring debt, and stagnant productivity gains. On major global issues too, the group’s influence appears to be waning. Take the Russian invasion of Ukraine. While the G-7 and the European Union have provided the vast majority of aid and military support, most other nations have remained aloof or even backed Moscow. China is effectively supporting Russia through bilateral trade, and the diversion of goods through third countries still enables President Vladimir Putin to wage war. Yet G-7 leaders are still capable of pulling together. They [sealed an agreement today]( to provide Ukraine with about $50 billion of fresh aid in the form of loans repaid using the profits generated by frozen Russian sovereign assets. And there’s growing unity in the face of China’s export juggernaut. While the Biden administration is tightening sanctions on everything from steel to semiconductors, the EU [announced yesterday]( it will hike tariffs to as high as 48% on electric vehicles imported from China. Don’t forget the G-7 accounts for 44% of the world economy. When its leaders show they have the will, it [can still pack a punch](. —[Karl Maier]( A police officer walks with a sniffer dog near the media center at the G-7 Summit. Photographer: Tiziana Fabi/Getty Images Global Must Reads Argentine President Javier Milei’s signatute reform package won key victories when the Senate [approved his omnibus bill]( and gave initial approval to separate legislation in razor-thin voting after violent protests erupted in front of the congress building. Its passage proves Milei can legislate despite a hostile relationship with members of Congress he continues to vilify. Anti-government protesters clash with police outside Congress in Buenos Aires yesterday. Photographer: Gustavo Garello/AP Photo Fresh doubts emerged over a truce in the devastating war in Gaza after US Secretary of State Antony Blinken said some of [Hamas’s latest demands]( on a cease-fire proposal backed by Biden are unacceptable. Washington has also been unable to explain why Israel, which has said it won’t stop until the Palestinian militant group is destroyed, would agree to a proposal that lets the group survive. Macron said that Marine Le Pen would “impoverish” citizens and scare off investors if her party gets its hands on power in the legislative elections he unexpectedly called after losing badly to her in last weekend’s European ballot. Trouble is, it’s a warning that increasingly seems to fall on deaf ears in France and elsewhere in Europe as voters [embrace the nationalist right](. Keir Starmer said he will put economic growth and wealth creation at the heart of Labour’s manifesto for the UK election on July 4, as his opposition party [seeks to blunt attacks]( about taxation by the ruling Conservatives. With a [poll lead]( of over 20 points, Labour is on track to oust Sunak’s Tories and take power for the first time in 14 years. With five months to go before the [COP29 climate summit](, the biggest fights are set to be over how to channel trillions of dollars from developed nations to emerging markets — and how China fits into the equation. At a gathering in Bonn this week, negotiators representing more than 190 countries got a clear sense of the scale of the challenge facing Azerbaijan, a relatively small player on the international stage that stepped in to host COP29 [at the last minute](. Israeli scientists say they are experiencing a growing academic boycott over the country’s war with Hamas in Gaza — potentially damaging not only Israel but also science, which [relies on global collaboration](. South Africa’s top court dismissed an application to stop parliament from convening tomorrow [filed by a party]( led by former President Jacob Zuma, which argued the May 29 national election was rigged. Greece is shifting the focus of its LGBTQ rights agenda to changing attitudes rather than legislation, Greek Prime Minister Kyriakos Mitsotakis [told us](, a blow to activists hoping for further reform after a landmark same-sex marriage bill was introduced this year. Washington Dispatch With Joe Biden out of town at the G-7, Donald Trump returns to the capital today to a sort of triumph that seemed unthinkable when he left office in the wake of his defeat in the 2020 election and the Jan. 6 insurrection. The former president [will meet with Republican senators]( to discuss strategy in next year’s Congress. The Republican-controlled US House [has voted]( to hold Attorney General Merrick Garland in contempt of Congress over his refusal to turn over audio recordings of Biden’s interview with a special counsel investigating his handling of classified documents. Trump will also [take part]( in a business forum with around 100 chief executive officers. That gathering takes place after many wealthy donors who shunned him after the attack on the Capitol have [returned to his fold](. Their support hasn’t flagged since his felony conviction in a New York court two weeks ago. Two people to watch today: Securities and Exchange Commission Chair Gary Gensler and Rostin Behnam, chairman of the Commodity Futures Trading Commission, are due to testify on their 2025 budgets before the Senate subcommittee on Financial Services and General Government. [Sign up for the Washington Edition newsletter]( for more from the US capital and watch Balance of Power at 1 and 5 p.m. ET weekdays on Bloomberg Television. Chart of the Day East African finance ministers will need to strike a balance between burdening their nations with more loans and boosting their economies pounded by heavy rains and flooding when they [present their spending plans]( today. Kenya, Tanzania, Uganda and Burundi have already signaled that they will increase expenditure funded by fresh borrowing and taxes. And Finally Barely a year after Las Vegas casino operator Wynn Resorts announced [plans for a $4 billion resort]( in the United Arab Emirates, the area is crawling with construction workers erecting five-star resorts, shops and $7 million villas. At least 20 developers have projects in various stages of design and construction on the artificial Marjan islands off the emirate of Ras Al Khaimah, according to Abdulla Al Abdouli, head of the state entity that developed them. He expects most projects to be completed within just six years. Rendering of Wynn’s proposed resort on the Marjan islands. Source: Wynn Resorts More from Bloomberg - Check out our [Bloomberg Investigates]( film series about untold stories and unraveled mysteries - [Bloomberg Opinion]( for a roundup of our most vital opinions on business, politics, economics, tech and more - [Next Africa](, a twice-weekly newsletter on where the continent stands now — and where it’s headed - [Economics Daily]( for what the changing landscape means for policy makers, investors and you - [Green Daily]( for the latest in climate news, zero-emission tech and green finance - Explore more newsletters at [Bloomberg.com](. Follow Us Like getting this newsletter? 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