Ministers from the G7 group of industrialised nations have discussed how to respond to the rise of China as they held their first face-to-face meeting in more than two years.

Dominic Raab welcomed his counterparts to London for a meeting held with strict coronavirus restrictions.

The Foreign Secretary and the other ministers were separated from each other by clear screens at the summit table, the number of aides present in meetings was also limited and the traditional family photo saw the dignitaries masked and socially distanced on the stairs of the Lancaster House venue.

Awkward forearm bumps replaced the usual handshakes as the Foreign Secretary welcomed his counterparts from France, Germany, Italy, Japan, Canada, the US and EU.

The ministers discussed how to use their combined political clout to respond to China’s economic power and increasingly assertive foreign policy agenda.

Although differences remain within the G7 over how to approach Beijing, there is a recognition that economic ties and the need for co-operation on health and climate change mean that China cannot be treated as an adversary in a new Cold War.

Asked what message the summit communique to be issued on Wednesday will send to authoritarian regimes, Mr Raab said: “We believe in keeping trade open, we believe in standing up for open societies, for human rights and democracy, we believe in safeguarding and promoting public good, whether it is the environment and tackling climate change, particularly with (climate change summit) Cop26 coming up in November, but also dealing with pandemics and public health more generally.”

US secretary of state Antony Blinken said: “We have to be able to engage China from a position of strength, and that means a few things.

“It means actually working with allies and partners, not disparaging them. That is a position of strength.

“It means leaning in and engaging in the vast array of multilateral and international organisations because that’s where so many of the rules are made. That’s where the norms are shaped.

“And if we’re not leaning in, we know that Beijing is likely to be trying to do so in our place.”

The summit meeting, after months of video conference diplomacy, is a key moment for the UK – which also hosts Cop26 this year.

The G7 finance ministers will meet in Lancaster House early next month, followed by the summit of leaders – US president Joe Biden’s first overseas visit – in Cornwall a week later.

Prime Minister Boris Johnson hosted Mr Blinken in Downing Street in a further attempt to build ties with the Biden administration.

Downing Street said the pair discussed the “close alignment” between foreign policy in London and Washington during their meeting, touching on issues in China, Iran and Afghanistan.

A No 10 spokeswoman said: “They agreed that UK-US co-operation will be instrumental in achieving progress on tackling Covid, protecting the environment and other international priorities.”

Regular testing and cleaning regimes are in place at the G7 summit – with one insider joking that there was “hand sanitiser running down the walls” – with the UK keen to avoid any coronavirus issues as it begins hosting the series of international meetings aimed at securing its place on the global stage following Brexit.

The G7 discussions also covered the coup in Myanmar, the situation in Libya and the ongoing war in Syria.

Mr Raab was using Tuesday evening’s working dinner to outline a vision of co-operation between the G7 and Indo-Pacific nations to develop stronger trade ties, ensure stability and tackle climate change, according to the Foreign Office (FCDO).

Australia, India, Japan, South Korea and South Africa have been invited as guests as the UK tries to deepen ties with the Indo-Pacific region.

G7 ministers will invest 15 billion US dollars (£10.9 billion) in development finance over the next two years to help women in developing countries access jobs, build resilient businesses and recover from the impacts of Covid-19.

They are also expected to sign up to new targets to get 40 million more girls into school, and 20 million more girls reading by the age of 10 in poorer nations by 2026, the FCDO said.

But the commitments come as Mr Raab faces sustained criticism for cuts to foreign aid, from 0.7% of national income to 0.5%, citing the financial impact of the pandemic.

The Foreign Secretary told the joint UK-US press conference on Monday that aid cuts had been a “difficult decision” but that the UK still has scope “to be an even greater force for good in the world”.