April 9, 2025 – Ottawa, Canada – As global financial markets reel from President Donald Trump’s escalating tariff blitz, Canada, the 2025 chair of the Group of Seven (G7) advanced economies, has taken the lead in rallying Japan and the European Union to safeguard stability in the financial system. Canada’s Ministry of Finance confirmed today that Finance Minister François-Philippe Champagne held urgent talks with Japanese Finance Minister Katsunobu Kato and EU Commissioner for Economy and Productivity Valdis Dombrovskis, signaling a concerted push to counter the economic fallout from U.S. tariffs that spiked to 104% on Chinese goods this morning.
The discussions, detailed in a ministry statement, underscore heightened alarm among G7 leaders as Trump’s reciprocal tariff regime—launched April 2 with a 10% baseline and ballooning to 20% for the EU and 25% for Canada—unleashes chaos. The S&P 500 has shed 12% since the announcement, the VIX fear index hit 46.98, and bond markets are in a rout, with Goldman Sachs now pegging U.S. recession odds at 45%. Against this backdrop, Champagne’s Wednesday phone conference with Kato zeroed in on shared concerns over the U.S. tariff wave, while his dialogue with Dombrovskis tackled the broader impact and potential responses. “Canada is committed to stabilizing markets as G7 chair,” a ministry spokeswoman said, noting Champagne’s outreach to other G7 counterparts over recent days.
Japan, a key G7 player, pledged cooperation with Canada and the International Monetary Fund (IMF) to tame the market upheaval, with its top currency diplomat echoing the urgency in a separate statement today. “We’re seeing violent swings—coordination is critical,” the diplomat told reporters, per Reuters. Champagne welcomed Japan’s stance, emphasizing their robust trade ties under frameworks like the CPTPP, which could anchor stability efforts. The EU, meanwhile, fresh off imposing its own 25% tariffs on $23 billion in U.S. goods—effective April 15—aligned with Canada’s call for a unified front, though specifics remain under wraps as talks evolve.
The context is dire. Trump’s April 2 “Liberation Day” tariffs, now averaging 25% across imports per JPMorgan, have triggered a global tit-for-tat—China’s 84% duties on $20 billion in U.S. exports kicked in today, and Canada’s $20.7 billion retaliation looms. Italy’s Economy Minister Giancarlo Giorgetti captured the G7’s non-U.S. bloc sentiment: “We’re trying to calm this and bring Trump to the table,” he told reporters in Rome. Yet, the White House and Treasury have stayed mum, with Trump doubling down on Truth Social: “They’ll come begging—watch!”
Historically, G7 finance chiefs have soothed markets through joint messaging—think 2008’s post-Lehman coordination. This time, the instigator is the G7’s economic titan, the U.S., complicating the playbook. Posts on X reflect the tension: “Canada’s stepping up while Trump swings the tariff bat,” one user noted, while another mused, “G7 minus US vs. US—wild times.” The ministry’s push aligns with Canada’s G7 presidency agenda, set to peak at the June 15-17 Kananaskis summit, where tariffs will dominate alongside climate and Ukraine.
For now, Canada’s outreach—backed by Japan’s market heft and the EU’s trade clout—aims to blunt the tariff storm’s edge. Champagne’s talks signal a G7 lifeline, but with Trump hinting at pharmaceutical tariffs next and the IMF’s spring meetings looming, stability hangs by a thread. As Britain’s Rachel Reeves told Reuters, “This’ll be front and center at G20—count on it.”
