If Russia doesn’t agree to a ceasefire in its conflict with Ukraine, Group of Seven (G7) nations have threatened to impose additional sanctions on Russia.
The finance chiefs said on Thursday night that they would look at how to force Moscow to step up if efforts to end Russia’s “continued brutal war” in Ukraine failed at the end of their G7 meeting in the Canadian Rocky Mountains, where foreign ministers were also meeting this week.
In a final communication, it read, “If such a ceasefire is not agreed, we will continue to look at all possible options, including those that could increase pressure, such as increasing sanctions,” the final statement read.
The G7, which included Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States, also pledged to work together to ensure that no war-financed nations would be able to take advantage of Kyiv’s reconstruction.
That was a “very big statement,” according to Canadian Finance Minister Francois-Philippe Champagne, who called it a pillar.
The group, however, avoided mentioning China, which the West has previously accused of supplying weapons to Russia.
Russia’s sovereign assets in G7 countries would continue to be obstructed until Moscow ended the conflict and paid Ukraine compensation for the harm it caused.
“Clear signal?”
Champagne stated at the G7’s final press conference, “I believe it sends a very clear message to the world that the G7 is united in purpose and action.”
However, the statement made no mention of US President Donald Trump’s tariffs, which are causing shaky economic conditions and global trade disruptions.
The strategy for Russia’s conflict in Ukraine also showed differences.
Trump has unnerved US allies by putting them at risk by holding bilateral ceasefire talks with Moscow, which US officials have used to refute.
The G7 statement from October, which called the conflict “illegal, unjustifiable, and unprovoked war of aggression against Ukraine,” was revised down in the statement.
The G7 Finance Ministers and Central Bank Governors’ Meeting in Banff, Alberta, Canada on May 21, 2025 [File: Todd Korol/Reuters]
Tariffs
Since Russian crude was selling below that level, the ministers discussed a proposal to lower the $60-per-barrel price cap on Russian oil exports, according to Valdis Dombrovskis, executive vice president of the European Commission.
An unnamed European official told the Reuters news agency that the official G7 communiqué did not include the plan because the US was “not convinced” about lowering the price cap.
The European Parliament approved tariffs on Russian imports of fertilizer just before the G7 meeting.
Trade will be halted if duties are implemented as per the European Union bill’s proposed tariffs starting on July 1 and gradually increasing over the course of three years, from 6.5% to about 100%, bringing about a halt.
“Not yet agreed upon”
After holding their first face-to-face meeting last week, the two parties’ diplomatic efforts to end the conflict have increased as international organizations continue to impose sanctions on Russia for its invasion of Ukraine.
Moscow appears to be stumbling, as it has since the US’s effort to broker a truce began.
Following rumors that the Vatican was willing to hold a meeting to discuss a ceasefire, the Kremlin stated on Thursday that new discussions were “yet to be agreed.”
Russia and Ukraine continue to exchange attacks.
Russian Defense reported on Friday morning that 24 of its air defense systems had crashed into 112 Ukrainian drones overnight, including 24 over the Moscow region.
In response to unwavering rhetoric on both sides, Iran and the United States are scheduled to hold a fifth round of discussions on Tehran’s nuclear program.
On Friday, Steve Witkoff, the US president’s Middle East envoy, and Iranian Foreign Minister Abbas Araghchi are scheduled to meet in Rome.
The Oman-mediated discussions are aimed at achieving a new agreement that would prevent Iran from producing nuclear weapons while lifting international sanctions. Little progress has been made, though, and both Washington and Tehran have recently taken a tough stance in public, particularly regarding Iran’s uranium enrichment.
According to Witkoff, Iran is prohibited from enriching any country.
Tehran has rejected that “red line,” saying that it has raised its enrichment to about 60%, which is significantly above the civilian level but below the 90% required for weaponization.
Ayatollah Ali Khamenei, the leader of the Supreme Court, warned that the ongoing discussions are unlikely to lead to any conclusions. He called the demand “excessive and outrageous.”
While acknowledging that achieving a deal that would allow Iran to have a civil nuclear energy program but not enrich uranium, US Secretary of State Marco Rubio stated on Tuesday that it “will not be easy to reach a deal”.
Iran’s construction sector was put under new sanctions by the State Department on Thursday.
Araghchi stated on social media on Friday morning, “Finding out the path to a deal is not rocket science.” We DO have a deal, according to the saying “zero nuclear weapons.” We don’t have a deal, so zero enrichment means. Time to make a decision.
Tehran’s Ministry of Foreign Affairs spokesman attacked the new sanctions, calling them “vicious, illegal, and inhumane.”
High stakes
Both sides have high stakes. Trump wants to stop Tehran from developing nuclear weapons that could stoke a regional nuclear arms race.
Iran insists that its nuclear ambitions are purely for civilians, but it wants to slam international sanctions that threaten its economy.
Trump resisted the Joint Comprehensive Plan of Action (JCPOA), a 2015 agreement that allowed Iran to reduce its nuclear program in exchange for easing sanctions during his first term, in 2018.
Trump renewed his “maximum pressure” program in January, including one that focused on Iran, adding to the country’s economic pressure, for example, by stifling China’s oil exports.
Ayatollah Ali Khamenei, Iran’s supreme leader, has rejected US demands to end enrichment and said the ongoing discussions are unlikely to succeed (File: Reuters).
Iran reacted defiantly, promising to stand up to any attack and agender-related enrichment that was unavoidable under the 2015 pact.
Tehran’s enrichment program has become a major source of contention since the two nations started the talks through Oman in April.
The cost could be prohibitive if the talks ultimately go badly. Trump has threatened military action on occasion if no agreement is reached.
On Thursday, the Trump administration revoked Harvard University’s ability to accept international students. The White House and the Ivy League university are at a crossroads as a result of this action.
Due to rising inflation and supply shortages, Japan’s favorite staple food’s price almost doubled in the past year, making it “rice crisis.”
According to government data released on Friday, rice’s price increased by 98.4% year over year in April after increasing by 92.5% year over year in March.
The surge is straining Japanese consumers’ wallets, further lowering Prime Minister Shigeru Ishiba’s and his ruling Liberal Democratic Party’s popularity.
Prices have increased by about 5, 000 yen (about $35) this month for 5 kg (11 pounds) of the well-known Koshihikari brand of rice despite emergency measures like tapping into government rice reserves. Early this month, according to Japanese media, the other varieties hit 4,200 yen (roughly $29).
Ishiba, who was speaking during a questioning session with Japan’s parliament this week, said, “We don’t know why we haven’t been able to push prices down.
He said, “We will first determine exactly how much rice there is and where it is.”
Rice prices are still being subject to an upward trend, according to Tim Harcourt, chief economist at the University of Technology Sydney (UTS), who is also the chief economist at the Institute for Public Policy and Governance.
According to him, “one is panic buying as a result of rumors of a mega-earthquake,” referring to an online rumor about Japan. “Which causes the shortage of wheat to replace rice because of the Russia-Ukraine war. And three more important things are that the Japanese tourism industry is expanding, and the demand for rice is rising.
Additionally, a particularly hot summer in 2023, which resulted in a poor harvest for Japanese farmers, has been linked to shortages.
Restaurants in Japan and some consumers have abandoned the traditional Japanese preference for locally grown rice and instead have started purchasing less expensive imported varieties as a result of rising prices.
In Tokyo, Japan, in February 2024, a seafood restaurant’s employees work in their kitchen. [Issei Kato/Reuters]
As voters turn out for parliamentary elections later this year, Japan’s “rice crisis” could affect its minority government’s chances in the future.
An economic crisis automatically turns into a political one, according to Harcourt of UTS, according to Harcourt.
According to a recent poll conducted by Japanese media, Ishiba’s cabinet’s approval rating decreased by 5% from April to 27.4% this month.
Due to the numerous gifts of rice supporters he received, agricultural minister Taku Eto was also forced to resign this week after causing outrage by declaring that he “never had to buy rice.”
The statement was deemed out of touch with voters, who are currently experiencing a cost-of-living crisis and high inflation.
Shinjiro Koizumi, his replacement, announced on Friday that he wants to raise rice prices by about 3, 000 yen (roughly $20) for a 5kg bag of rice.
The Bank of Japan’s latest data shows that Japan’s core inflation rate increased to 3.5% in April, its highest annual rate in more than two years. According to the BOJ, the consumer price index increased by 3.5 percent in April, which includes the price of oil but excludes fresh foods.
As Japanese businesses began their new fiscal year, food prices increased by 7.0 percent in April, according to government data. The price increased came after the March increase, which was 6.2% higher.
Japan was once renowned for having low inflation levels, but the COVID-19 pandemic and the Ukraine war helped to reverse the decades-long trend in 2022.
Four people were killed and tens of thousands were stranded in eastern Australia as a result of record-breaking floods.
On Friday, New South Wales Premier Christopher Minns and Prime Minister Anthony Albanese visited affected communities, some of whom have experienced the worst flooding on record this week.
Minns praised the emergency services and volunteers who have saved 177 lives in the past 24 hours in addition to 678 in recent days.
According to Minns, “it’s an amazing, heroic logistical effort where many volunteers risk their lives to rescue a complete stranger” in extremely challenging circumstances.
“We would have had hundreds of deaths without the volunteers, and we are deeply, deeply grateful.”
One person is reported missing in addition to the four fatalities.
New South Wales, the state with the highest population, has about 50, 000 people still living alone. After months of precipitation, roads and villages across Ireland are still blocked and roads are submerged.
Rural communities were ruined by flash floods, destroying homes, and turning streets into rivers. Debris and dead animals are now a common sight in coastal areas.
Residents who return have been issued a warning to remain vigilant.
You must consider the risks associated with swimming in bodies of water because they contain contaminants such as vermin and snakes. Emergency Services Deputy Commissioner Damien Johnston remarked that electricity can also present a threat.
According to experts, climate change is at the root of Australia’s recent history of extreme weather events.
According to Davide Faranda, a climate researcher at ClimaMeter, “what used to be rare downpours are now becoming the new normal,” climate change is rewriting Australia’s weather patterns one flood at a time, according to comments made by the Reuters news agency.
Further disruption is now being caused by the storm system’s extension southward movement toward Sydney.
flooded tracks affected both train and airport services. Flights were delayed by Sydney Airport’s two of its three runway closures for an hour on Friday morning.
According to experts, negotiations to end a ceasefire between Russia and Ukraine may soon be in progress, but Ukraine’s economic recovery won’t be as strong unless the European Union accelerates its membership and offers hundreds of billions of euros in insurance and investment, according to experts.
According to historian Phillips O’Brien, “I believe what Ukraine needs is some kind of future where it will have a stable and defendable border,” according to Al Jazeera.
Following a crucial Kremlin demand, President Donald Trump’s administration gave Ukraine and Russia a ceasefire proposal that forbade the country from joining NATO, leaving Ukraine without the security guarantees it demands.
What industry is willing to take the risk of entering that industry? posed by O’Brien. “With NATO off the table, I believe that a quick EU membership will be necessary if Ukraine wants to rebuild and be integrated into Europe.”
Although the European Commission began negotiations in record time in June, and Ukraine enjoys the support of EU heavyweights like France and Germany, membership is not guaranteed.
[Al Jazeera]
Ukraine would still face a depressed economy that would call for significant investment if it were to join the EU.
According to the Kyiv School of Economics (KSE), Moscow’s assault on its infrastructure had destroyed $170 billion in the first two months of its full-scale invasion, which took place in February of 2022 and November of last year.
The loss of 29 percent of Ukraine’s gross domestic product (GDP) from the invasion in 2022 was not taken into account for the damage caused by the almost a decade of war in the eastern regions of Luhansk and Donetsk since 2014. Additionally, the estimate did not account for Russia’s current occupying of almost a fifth of Ukraine’s territory.
According to SecDev, a Canadian geopolitical risk firm, the region contains almost half of Ukraine’s untapped mineral wealth, which is estimated to be worth $ 12 trillion.
Additionally, some reconstruction costs, such as those incurred by chemical decontamination and mine clearing, are excluded.
The World Bank projects that reconstruction and recovery will cost about $525 billion over the course of ten years, up from $ 176 billion in this year’s figure.
The Kremlin has undoubtedly plunderned occupied territory.
According to Maximilian Hess, a risk analyst and expert on Eurasia at the International Institute of Strategic Studies, Russia’s strategy has been centered on economic war since its 2014 invasion of Donetsk and Luhansk.
Hess told Al Jazeera, “The Kremlin has undoubtedly looted occupied territory, including for coking coal, agricultural products, and iron.”
According to the KSE, Russia allegedly snatched half a million tonnes of grain, which was included in the agricultural sector’s $1.9 billion damages bill.
Russia also targeted industrial centers that were outside its control with long-range rocketry.
The Kharkiv Tractor Plant, Zaporizhia Automobile Plant, Dnipro’s Pivdenmash rocket manufacturer, and numerous other large steel plants were all left over from the Soviet Union.
In his most recent book, Economic War, Hess wrote that “all were targeted by Russian forces.” The Kremlin hoped that the attack would result in a decrease in Kyiv’s support for the country, but they also raised the cost of supporting Ukraine in the conflict. This is where Russia’s attacks were primarily intended to be.
Russia managed to rob Ukraine of its prosperous metallurgy sector through occupation and targeting.
The war resulted in a 66.5% decrease in metallurgical production, according to the US Geological Survey.
Given that Ukraine once produced a third of the region’s manganese ore, a third of its titanium, and almost a third of the iron ore in Europe, Russia, and Central Asia, that is a significant loss. Uranium, which is a significant resource in the continent’s effort for greater energy autonomy, is still the only producer of it in Europe.
A rare example of a wartime economic success story stems from Ukraine’s claims that it helped create a $20 billion defense industrial base with allied support.
Hess said that can compensate for the losses in metallurgy, “but only in some and various regions of the nation where those mining and metallurgical losses were concentrated. It will be necessary to promote metallurgical activity in places like Kryvyi Rih, Dnipro, Zaporizhzhia, and ideally, territory that is ultimately free of Russian occupation.
Trump’s minerals deal and other instruments
A memorandum of intent to mine the country’s mineral wealth was signed by Ukraine and the US a few weeks ago.
Experts doubted the idea that mineral wealth could help rebuild Ukraine, despite the country’s commitment to putting half of the proceeds from its metallurgical activities into a Reconstruction Fund.
The KSE Institute’s head of strategic projects, Maxim Fedoseienko, stated to Al Jazeera, “Projects have a long launch period… from five to ten years. You need three years to build this mine, and you also need to conduct an environmental impact assessment and documentation.
Because “we have more than 24 kinds of materials from the EU list of critical]raw materials,” the US and EU might invest in these mines, Fedoseienko said, but they would only make an equitable investment.
Trump referred to the minerals deal as reversing the military’s billions.
Nothing about it is even remotely fair. O’Brien claimed that the aid was not being returned.
It is unfair if everyone says, “OK, we will help you in a time of war, so you are owned by] us,” as Fedoseienko put it.
Residents are seen outside of Kyiv next to houses that have been severely damaged by a Russian drone strike.
Ukraine requires money in addition to fairness. That also requires insurance in some cases.
For instance, a state-backed war-risk insurance agreement Kyiv and the United Kingdom reached in 2023 that reintroduced bulk carriers into Ukrainian ports and defeated Russian attempts to obstruct Ukrainian grain exports.
In consequence, according to the agriculture ministry, Ukraine exported 57.5 million tonnes of agricultural products between 2023 and 2024, and was on track to export 77 million tonnes in the same period until 2024-2025.
Hess argued that “there needs to be a significant expansion of public insurance products specifically and a move to seize frozen Russian assets.”
Although it was deemed controversial to seize $300 billion in EU funds, the initiative is now popular.
O’Brien claimed that the Russian state has committed these war crimes and broken international law by causing this harm to Ukraine, which ultimately serves as a justification for helping Ukraine recover. “Europeans have a very strong argument against this, but they lack the political will to do it right now.”
Volodymyr Zelenskyy, the president of Ukraine, has asked Europe to use the funds for its defense and reconstruction on numerous occasions.
What the Europeans have accomplished thus far has had an impact on the reconstruction of Ukraine.
Every year, about $300 million in interest payments made from Russian assets are diverted to reconstruction.
A program funded by the European Commission offers financial assistance worth 9.3 billion euros ($11.05 billion) to encourage private sector investment.
Ukrainian banks are given loan guarantees by financial institutions like the European Bank for Reconstruction and Development, which provides them with liquidity.
“So Ukrainian banks can loan Ukrainian businesses to invest and run in Ukraine. This is a significant ecosystem that can support economic investment and operational needs in Ukraine, Fedoseienko asserted.
The KSE runs an online portal that provides information on the various instruments available, which has already resulted in the successful completion of 165 investments worth $ 27 billion, in collaboration with the finance ministry.
