G20 finance ministers have warned “trade and geopolitical tensions” pose a risk to international growth in an official statement, without directly addressing the US-China trade dispute.
After much debate over the wording of a “communique” from their meeting in Japan, ministers today said they will “continue to take joint action to strengthen international cooperation and frameworks”.
The statement came a month after US President Donald Trump slapped 25 per cent tariffs on $200bn of Chinese goods in a move that has rocked global stock markets.
Yet the communique did not condemn the ongoing trade war or say it should be resolved, likely as a result of US opposition to such a statement.
US Treasury secretary Steve Mnuchin attended the two day meeting in Fukuoka, Japan, which convened the G20’s finance chiefs and central bankers. He has been a key negotiator with China over trade.
The communique from the meeting said: “Global growth appears to be stabilising, and is generally projected to pick up moderately later this year and into 2020.”
It went on: “However, growth remains low and risks remain tilted to the downside. Most importantly, trade and geopolitical tensions have intensified.”
The statement also included a pledge to “redouble our efforts” to find a solution to tax avoidance by giant technology companies by 2020.
Closing the meeting in Fukuoka, Christine Lagarde, the head of the International Monetary Fund (IMF), tackled the issue of US-China trade tensions head on.
She said “the principal threat” to the global economy “stems from continuing trade tensions”, and revealed the IMF thought US-China tariffs could reduce the level of global GDP by 0.5 per cent or around $455bn (£357bn) in 2020.
“To mitigate these risks, I emphasised that the first priority should be to resolve the current trade tensions – including eliminating existing tariffs and avoiding new ones,” she said.