G20 fails to agree on free trade endorsement

He said it was "important to create a comfort zone" where leaders could have their first discussions with the new administration, "to make them feel that this is a place where we can talk, we can ventilate the areas where we have common ground and the areas where we may have differences".

Acquiescing to an increasingly protectionist United States after a two-day meeting in the German town of Baden-Baden, the finance ministers and central bank governors of the 20 biggest economies dropped a pledge to keep global trade free and open. To be driven by a former Goldman Sachs banker, Steven Mnuchin, borders on freaky.

US Treasury Secretary Steven Mnuchin today shrugged off an outcry over the omission of a long-standing anti-protectionist pledge from a G20 statement, saying language used in the past is "irrelevant".

"I think that accurately reflects what we as a group talked about". This breaks with a decade-old tradition of the G20 endorsing free trade and rejecting protectionism. "I understand what the president's desire is and his policies, and I negotiated them from here", Mnuchin said. But the new U.S president, who has promised to put "America First", has made no secret of his disdain for multilateral trade deals that he says have treated America unfairly. USA unilateralism threatens to clash with everyone else, including countries like China who feel, as massive beneficiaries, duty bound to defend the current trade setup.

The conspicuous omissions come as Trump champions a "Buy American" strategy that includes threats to penalise companies that manufacture overseas by heavily taxing their products.

The conspicuous omission came amid a push by U.S. President Donald Trump to pursue an "America First" policy that includes penalising companies that manufacture overseas by heavily taxing their products.

His stance has been condemned by Washington's trading partners, and led Beijing to issue a stern warning against sparking a trade war.

"It is totally undisputed that we are against protectionism, but it is not clear what we all mean by that", German Finance Minister Wolfgang Schäuble said at the press conference following the meeting, adding that Mnuchin did not have the authority to get creative on trade language.

French Finance Minister Michel Sapin said if no agreement could be found on both sticking points, that could be reflected in Friday's final statement. "Our world and France would have liked to see the G-20 continue to take firm and concerted action", he went on.

However, German Finance Minister Wolfgang Schauble struck a conciliatory tone, noting that in the U.S. the matters of finance and trade were divided in two portfolios.

Related:

Comments


Other news