Participants attend a photo session at the end of the G20 finance ministers and central bank governors meeting Sunday in Fukuoka. Photo: AP/Eugene Hoshiko

G20 finance leaders say trade, other tensions 'intensifying,' but pledge action to counter risks

By Elaine Kurtenbach

Finance ministers and central bank chiefs from the Group of 20 major economies wrapped up a meeting in Japan on Sunday with a pledge to use all the policies they can to protect global growth from disruptions due to trade and other tensions.

The G20 finance leaders said in a joint communique that risks from trade and geopolitical tensions were "intensifying." They did not refer directly to the tariffs war between the United States and China, though leaders participating in the meetings indicated it was the No. 1 concern.

"We will continue to address these risks, and stand ready to take further action," the statement said. "We reaffirm our commitment to use all policy tools to achieve strong, sustainable, balanced and inclusive growth, and safeguard against downside risks."

Global growth appears to be stabilizing and is expected to pick up later this year and next year, the statement said.

But there was an evident rift between most participants in the meeting and the U.S., which has shifted away from support for tackling issues in multilateral forums such as the World Trade Organization in favor of a country-by-country "America First" approach.

French Finance Minister Bruno Le Maire said the current global slowdown was linked to political issues, "especially trade tensions."

"So it's high time that we put an end to those tensions and we should avoid trade wars which would have real deep negative impact and long-term impact on global growth," he said.

He urged China and the U.S. to resolve their disputes through the WTO, saying it "is only within the multilateral framework that we can find long-term solutions for present trade tensions."

Christine Lagarde, managing director of the International Monetary Fund, likewise was blunt in warning of the potential toll from the tit-for-tat tariff hikes and other retaliatory moves between Washington and Beijing with talks on resolving their dispute in a stalemate, saying that the "road ahead remains precarious."

"The principal threat stems from continuing trade tensions," said Lagarde, adding that the IMF estimates the tariffs could reduce the level of global GDP by 0.5 percent in 2020, or about $455 billion.

"To mitigate these risks, I emphasized that the first priority should be to resolve the current trade tensions - including eliminating existing tariffs and avoiding new ones - while we need to continue to work toward the modernization of the international trade system," Lagarde said.

Japanese Finance Minister Taro Aso appeared to have wearied of the issue by the end of the meetings.

"The China-U.S. issue is all you ask about. We have plenty of other issues that we need to consider," he said.

While they urged the U.S. to stick to the international rules that it spent decades promoting before President Donald Trump took office, the officials both in the southern Japanese city of Fukuoka and at parallel talks on trade and the digital economy in Tsukuba, near Tokyo, said there is a consensus on the need to revamp the WTO to bring it more in line with the digital economy realities of the 21st century.

Trump has said he prefers deal-making on a country-to-country basis. While there is no sign Beijing and Washington are ready to resume trade talks that stalled last month after 11 rounds of negotiations, U.S. Treasury Secretary Steven Mnuchin said he had a constructive meeting Sunday with China's central bank Gov Yi Gang on the sidelines of a financial leaders' meeting in Fukuoka.

In a Twitter post that showed the two clasping hands, Mnuchin said he and Yi "had a candid discussion on trade issues." He gave no details.

Mnuchin told reporters that he expected that any major progress in resolving the impasse would likely come at a meeting of Presidents Donald Trump and Xi Jinping during the G20 summit in late June in Osaka, Japan.

Trump has yet to decide, Mnuchin said, on whether to impose more 25% tariffs on $300 billion worth of Chinese exports. That would be on top of tariffs of up to 25% on $250 billion in Chinese goods. Together they would encompass almost everything China exports to the U.S.

There was no immediate word from the Chinese side about the meeting between Yi and Mnuchin.

At the meeting of trade and economy ministers in Tsukuba, a government research hub, the officials endorsed a similar set of recommendations, while also issuing a mild call to "handle trade tensions and to foster mutually beneficial trade relations."

"We strive to realize a free, fair, non-discriminatory, transparent, predictable and stable trade and investment environment, to keep our markets open," they said. "We recognize our business community's call for the G20 to continue supporting the multilateral trading system."

Japan, the world's third-largest economy, is hosting the G20 for the first time since it was founded in 1999.

The venue for the annual financial meeting, Fukuoka, is a thriving regional hub and base for startups. Much attention at the G20 meetings this year has focused on how to adapt tax systems and regulation to the increasingly digital nature of business.

While Mnuchin and other officials made it clear that they disagreed on the details of how to do that, the officials said they had agreed that the G20 and Organization of Economic Cooperation and Development would work together on drawing up an agreement by the end of 2020.

The G20 group includes Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Japan, South Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States and the European Union.

© Copyright 2019 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

©2019 GPlusMedia Inc.

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Who's causing trade tensions? It couldn't be the imbecile in the WH, could it?

-1 ( +5 / -6 )

Could be anyone in the picture above. Trump is just the way they distract you from what they are doing.

-1 ( +4 / -5 )

Looks like the government ministers are doing all the actual work now and this week, before their bosses arrive to shake hands and take pictures (and close down our highways).

1 ( +2 / -1 )

Impotent, as soft as that.

-4 ( +1 / -5 )

Not that it matters to Trump since his knowledge of anything is pretty minuscule because he doesn't read, but has Mnuchin informed him exactly which two countries owns close to 30% of the U.S. debt? Does the Trump base know that? What is Trump going to do if China decides to slash its Treasury holdings like Russia? And Japan who is second to China who holds U.S. debt? Trump is going to hit Japan with auto tariffs after the Japanese election to save Abe's face? Not exactly playing with a full deck if you ask me. If they call him he's going to fold. How about sound domestic economic policies that add disposable income to the populace by providing adequate and fair wages, and social services that sustain the health and well being of the work force? G20 is nothing but the rich trying to get more of their share, damn the people.

3 ( +5 / -2 )

You can’t have your cake and eat it too.

The international monetary system is based on the dollar. Needless to say, there are benefits to that, but it it were not so and the dollar devalued, prices of products would be more competitive.

If you would be willing to reduce profits and pay more for wages, you could manufacture in your own country. Keep jobs in the America is a message for US companies

Why go to a country and take advantage of low labor costs, manufacture your products there, then complain that country is exporting more than you are exporting?

If you reduced your deficit with country A and moved some of your factories to country B, you’d still have an overall trade deficit Unless you gave up the saved costs of production and moved the factories back home, the problem would remain

If you spent less, reduced your budget deficit, and had a higher savings rate, interest would be lower and the dollar wouldn’t be as high and your trade deficit would not be as imbalanced.

1 ( +2 / -1 )

And where are the rest of the women?

-1 ( +1 / -2 )

The central bankers shown in the photo might work with the finance ministers. But ultimately they work for the Bank of International Settlements, the central bank of central banks and a privately owned corporation. The politics and 'tensions' is mostly a distraction.

2 ( +2 / -0 )

...tackling issues in multilateral forums such as the World Trade Organization...

Haha! "Tackling"?! Forced technology transfers, IP theft, hacking, etc. were rampant in China during the era of "multilateralism." Finally, now, something is being done about it. And it's not because of the WTO, LOL.

2 ( +3 / -1 )

Terrible photographer ‘ editor. Faces were cut off, some are not facing the camera, etc. Disrespectful.

-2 ( +0 / -2 )

For the common intelligence in me, why are they attacking China when they should be attacking Trump & the U.S.A ???.

-1 ( +1 / -2 )

You want to help us? Hows about not charging ATM fees for customers visiting their own bank atm.

0 ( +0 / -0 )

If there ever was a cheering squad for the world's 1%ers this selfish, sordid crowd represent it.......

2 ( +2 / -0 )

Too much generalities of intentions and no real plan or goals or even objectives stated to make much difference. Let them go through the motions at least and wait for the final announcement.

1 ( +1 / -0 )

We reaffirm our commitment to use all policy tools to achieve strong, sustainable, balanced and inclusive growth, and safeguard against downside risks.

'Right after we finished our foie gras, lobster and champagne' and not before some of us return from Club de Les Girls Avec Tres Grande Boobs'

0 ( +0 / -0 )

Easy solution: forget the US and trade among yourself, drop the US$ as standard and isolate the US. Don't forget what trump said: "America first" and to hell with the rest.

-1 ( +0 / -1 )

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