G20 leaders worried over tariff war

G20 leaders worried over tariff war

Some leaders from the Group of 20 major economies have expressed fears about the potential negative impact of a U.S.-China trade war on the world economy at a session of their two-day summit that started Friday, a Japanese government official said. However, as Japan Times writes in an article "G20 leaders worried over tariff war", it remains to be seen whether the G20 can agree on a joint communique, as the United States and China, the world’s two largest economies, have been engaged in tit-for-tat rounds of punitive tariffs on hundreds of billions of dollars of each other’s imports.

At the Asia-Pacific Economic Cooperation summit last month, leaders of the 21 members failed to finalize a joint declaration for the first time since the forum began in 1993, against a backdrop of the deepening divide between Washington and Beijing.

If the G20 summit also falls short of adopting a joint communique for the first time since its inception in 2008, skepticism would grow about the ability of the current international framework to find common ground, blurring the outlook for the global economy.

On the sidelines of the G20 gathering, designed to concentrate on fiscal and monetary policy matters, U.S. President Donald Trump and Chinese President Xi Jinping were slated to hold their first face-to-face talks since November 2017.

At the outset of his meeting with Prime Minister Shinzo Abe in Buenos Aires on Friday, Trump voiced optimism about the prospects of the planned U.S.-China summit, saying, “We’re working very hard.”

“If we can make a deal, that’d be good. I think they want to, I think we’d like to,” Trump said, adding, “There’s some good signs. We’ll see what happens.”

Speaking with Abe, Trump urged the prime minister to address the trade imbalance between the two countries “very quickly,” a sign that Washington will push Tokyo in the upcoming talks to cut the U.S. goods trade deficit.

Calling the deficit “massive” and “pretty substantial,” Trump said, “We hope that we’re going to be balancing it very quickly.”

Trump praised Japan’s purchases of F-35s and other U.S. fighter jets, a move that would significantly reduce the deficit. “Japan is buying large amounts of our fighter jets, our F-35s and others, and we appreciate it very much,” he said. “They are really working with me on trying to balance our deficit.”

A senior Japanese official said the government had not decided on the new purchase of F-35s, but that the Defense Ministry is reviewing the nation’s whole fighter jet system for the future.

Trump has been criticizing Japan over its hefty and chronic goods trade surplus with the United States. His administration is expected to push Japan for increased market access for automobiles and agriculture.

The U.S. goods trade deficit with Japan totaled $68.85 billion in 2017, the third-largest among countries with which the United States generated a trade deficit, according to U.S. Commerce Department data.

During a meeting with Xi in the capital of Argentina, Abe said he hopes that the United States and Chinese leaders will have a fruitful discussion, according to the Japanese official.

Citing U.S. and Chinese officials, the Wall Street Journal reported Thursday that the two sides are considering launching new talks looking at “big changes” in Chinese economic policy in return for Washington holding off on further tariffs through the spring.

Speculation, however, is rife that the two leaders will not easily make concessions over trade issues, as Trump has continued his threats to take additional measures against China despite Xi’s eagerness to resolve the ongoing trade dispute through dialogue.

So far, the United States has imposed tariffs on $250 billion of Chinese imports — or about half the goods it imports from China each year — in response to Beijing’s alleged theft of intellectual property and technology, as well as other trade complaints.

In retaliation, China has levied tariffs on more than 80 percent of all goods imported from the U.S.

“We need to safeguard the multilateral trade system by adhering to the spirit of openness and cooperation,” Xi was quoted by the official Xinhua News Agency as saying at a session of the G20 summit on Friday.

Trade problems “should be widely debated” and each nation “should not become dogmatic,” Xi told his G20 counterparts, according to the state-run media.

Criticism, meanwhile, has been lingering among the international community about Beijing’s alleged unfair business practices. China has also been lambasted by many G20 countries for providing opaque benefits to state-owned firms.

Trump has apparently been attempting to not only curb massive U.S. trade deficits with China but also to sell U.S. products in Chinese markets without concern about intellectual property and technology theft, diplomatic sources said.


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