- Jul 14
- 4 min read
By Jomo Kwame Sundaram and Nurina Malek
KUALA LUMPUR, Malaysia, Jul 14 2026 (IPS) - Trump insists the West must unite on his terms against the Rest, particularly China and Iran. Europe, however, wants greater Trump support for Ukraine’s Zelensky regime to replace Putin’s leadership of Russia.
Europe v China?
In June 2026, European officials accused China of training Russian military personnel to fight in Ukraine.
After Secretary of State Marco Rubio’s Munich appeal for Western unity based on shared race, culture and imperial history, this appears to have been a European effort to strengthen its alliance with the US.
The unsubstantiated charge of Chinese military support to Russia against Ukraine, a claim never corroborated by Kyiv, is expected to worsen relations between Europe and China.
Portraying China as a strategic threat to Europe justifies greater belligerence against Beijing. It no longer seems to matter that China has never endorsed Russia’s invasion of Ukraine.
However, China retains strong ties with Kyiv, calling for a ceasefire and political settlement, while repeatedly offering to mediate between the warring neighbours.
The G7summit of the seven largest rich economies in late June followed the EU in trying to consolidate Western strategic solidarity against Russia, China and Iran.
With financial crises from 1997 threatening G7 legitimacy, then US Treasury Secretary Larry Summers initiated the G20. But the recently expanded G7 role marginalises the more inclusive but less amenable G20.
Neoliberalism over
Since the 2008 global – actually Western – financial crisis, Europe has become even more protectionist.
More Chinese goods have entered European markets, with prices and quality that most others cannot match. For years, Western leaders happily enabled this by liberalising trade, appreciating cheap Chinese imports, for keeping inflation low.
After decades of state-encouraged investment, China’s still growing industrial capacity now supplies the world, enabled by Western-drafted WTO rules.
Before Trump 2.0, Washington had imposed investment restrictions, Section 301 measures, sanctions, tariffs and more following Obama’s ‘pivot to Asia’. Facing less US market access, more Chinese exports have gone elsewhere.
European industry can no longer compete, even where it once led. Instead of neoliberal WTO trade liberalisation, EU protectionism supposedly ‘levels the playing field’.
US advisers increasingly warn European officials that China’s industrial ‘overcapacity’ will soon scale up the ‘China shock’ in most industrially significant supply chains.
China now refines and processes most of the world’s ‘rare earth’ minerals, exercising near-monopsonistic leverage over suppliers by processing at scale at much lower cost.
With China successfully countering Trump’s trade policies, Western leaders worry Beijing will abuse its near-monopolistic control of rare earth elements, which downstream industries need.
Jeffrey Sachs argues that New York and London rare earth market reactions indicate major institutional investors view recent developments as significant.
G7 vs China
Protecting European industry, labour and economic sovereignty is now constrained by the rules Western leaders put in place over decades, often coordinated by the OECD.
Splits inside the EU soon extended beyond commercial faultlines to ostensible strategic interests defined by the fluid geopolitics after the first Cold War.
German car exports to China have been superseded by Chancellor Metz’s military Keynesianism, in line with Trump’s demand for NATO allies to spend much more on the military to greatly strengthen Western military power and global dominance.
French President Emmanuel Macron’s earlier push for unaligned European ‘strategic autonomy’ has given way to a NATO+ strategic view embracing Western imperialism.
Meanwhile, smaller EU member states remain cautious, fearing the collateral effects of new Western ambitions, such as Chinese restrictions on imports that Europe depends on.
Great power rivalry
With the Iran war refusing to fade from daily headlines despite Trump’s on-off-on ceasefire, other myths are also evaporating. Few still believe Israel will accept a ‘two-state solution’ or that peace will prevail between trading partners.
NATO, OECD, G7, EU and other such arrangements have become variable links in the hegemonic US-led bloc. Such coalitions – including Europe, Canada, Australia, and Japan – were never seamless together or fully fit-for-purpose.
Trump expects unilateral US aggression against Washington’s chosen enemies must be fully supported and subsidised by NATO allies, with reluctance deemed disloyal, even antagonistic.
Countries not aligned with the major poles may be alternatively courted and coerced by rival poles, especially by the affluent West. Cooperation among others may be seen and portrayed as proof of the existence of an antagonistic bloc.
Multiple poles are likely to coalesce into the West versus the Rest, competing for support and influence, as those courted try to gain from their suitors.
With reduced government engagement and less sustained inter-state cooperation and order, disruptions in an increasingly anarchic world economy have required governments to prioritise resilience as businesses, consumers and labour face rising costs.
As the US and its allies weaponise economic rules and arrangements to discipline both friends and foes, the world economy is slowing unevenly as prices rise sporadically.
The US-Israel war on Iran underscores how current conflicts can develop in unpredictable ways as states and other significant non-state ‘actors’ innovate strategically in unexpected conditions.
