G20 calls for greater dialogue on trade tensions
(Adds quote from Australia treasurer)
By Daniel Flynn and Luc Cohen
BUENOS AIRES, July 22 (Reuters) - Finance ministers and
central bankers from the world's largest economies said on
Sunday that heightened trade and geopolitical tensions risk
derailing global growth, and called for greater dialogue,
according to the final communique of a G20 meeting.
The weekend talks in Buenos Aires come at a time of
escalating rhetoric in the trade conflict between the United
States and China, the world's largest economies, which have so
far slapped tariffs on $34 billion worth of each other's goods.
U.S. President Donald Trump raised the stakes on Friday with
a threat to impose tariffs on all $500 billion of Chinese
exports to the United States unless Beijing agrees to major
structural changes to its technology transfer, industrial
subsidy and joint venture policies.
The communique noted that global economic growth was robust
and unemployment was at a decade low. However, it warned that
growth was becoming less synchronized among major economies and
downside risks over the short- and medium-term had increased.
"These include rising financial vulnerabilities, heightened
trade and geopolitical tensions, global imbalances, inequality
and structurally weak growth, particularly in some advanced
economies," said the communique.
The ministers reaffirmed the conclusions from G20 leaders at
their most recent summit in Hamburg last July, when they
emphasized that trade was an engine of global growth and that
multilateral trade agreements were important.
"We ... recognise the need to step up dialogue and actions
to mitigate risks and enhance confidence," the communique said.
The language marked an incremental toughening from the
communique issued at the previous ministerial meeting in March,
which had only noted that the leaders "recognise the need for
"The latest language suggests a great deal of urgency about
resolving these issues," Australia Treasurer Scott Morrison said
in an interview, adding that the ministers had made it clear in
the discussion that they were concerned about "tit-for-tat
measures" and that open trade was the goal.
"The language previously had been a bit ambiguous about
that, a bit sheepish."
Trump has angered European allies by imposing import tariffs
of 25 percent on steel and 10 percent on aluminum, causing the
European Union to retaliate with similar amounts of tariffs on
Harley-Davidson Inc motorcycles, bourbon whiskey and
Trump, who frequently criticizes Europe's 10 percent car
tariffs, is also studying adding a 25 percent levy on automotive
imports, which would hit both Europe and Japan hard.
"We were in mutual listening mode and I hope that this is
the beginning of something," European Commissioner for Economic
and Financial Affairs Pierre Moscovici told reporters on Sunday,
referring to the G20 negotiations. "But still the positions are
U.S. Treasury Secretary Steve Mnuchin has sought to use the
meeting to woo Europe and Japan with the offer of free-trade
deals, as Washington tries to gain leverage with allies in its
dispute with China.
European Council representative to the G20 Hubert Fuchs said
the United States' removal of tariffs was not a necessary
precondition for trade talks to begin and he welcomed the candid
approach adopted by Mnuchin at the meeting.
"Even the (Treasury secretary) of the United States says
that he's in favor of fair and free trade, but the problem is
that the United States understands something different under
fair and free trade," he said.
Canadian Finance Minister Bill Morneau said Mnuchin had over
the weekend expressed a goal for all G7 countries to "drop all
tariffs, non-tariff barriers and subsidies," which Morneau
characterized as a "great idea" and an "aspirational target" but
difficult to execute.
The communique emphasized that structural reforms were
needed to enhance growth, and reaffirmed commitments from
March's ministerial meeting to refrain from competitive
devaluations that could have adverse effects on global financial
(Reporting by Daniel Flynn
Additional reporting by Luc Cohen, David Lawder, Eliana
Raszewski and Scott Squires
Editing by Lisa Shumaker and Rosalba O'Brien)
First Published: 2018-07-22 00:58:08
Updated 2018-07-22 22:29:08
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