Group of 20 members has pleaded for increased dialogue to defuse escalating trade tensions that could hit global economic growth hard.
Finance ministers and central bankers from 20 leading economies closed a two-day meeting in Buenos Aires on Sunday warning that “heightened trade and geopolitical tensions” threaten the economic expansion.
It comes at a time when US President Donald Trump’s protectionist policies have provoked ire from traditional allies such as the European Union, Canada and Mexico, and sparked a series of retaliatory measures.
The G20’s final communique stressed “the need to step up dialogue and actions to mitigate risks and enhance confidence” amidst fears of an escalating global trade war.
While the statement did not mention the United States, which is at the centre of trade disputes with G20 members China, the EU and others, it demonstrated more concern than in March, when the group avoided the issue altogether.
Argentina’s Economy Minister Nicolas Dujovne hinted that the G20 could not afford a rupture over trade disputes which he said should be resolved directly between governments or through the World Trade Organisation.
“It’s not about denying differences,” Dujovne told reporters at the conclusion of the meeting. But “we have to try to emphasize consensus because we recognize the importance of keeping this group alive and in harmony.”
During the 2008 global financial crisis the G20 was critical in preventing an even worse outcome and saved millions of jobs, he said, noting that “it’s in the bad times when you see how essential it is.” But Treasury Secretary Steven Mnuchin reiterated his claim that the US merely wants “more balanced trade” with other countries.
Mnuchin also dismissed the economic impact of the raft of tariff hikes and retaliatory duties, saying so far they have only affected the US on a “micro” scale. But from a “macro standpoint we do not yet see any significant pattern on the economy.” US businesses have been hit with a series of punitive measures by China, the EU, Canada and Mexico, including tariffs on soybean, motorcycles, bourbon and other goods, while manufacturers are complaining about rising prices of key supplies subject to new US duties.