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G20: Protectionism damaging for global economy

  • Published at 11:44 pm April 22nd, 2017
G20: Protectionism damaging for global economy
The Group of 20 major economies sent a message Friday on the threat that rising protectionism poses to the global economy, but the United States cast doubt over its adherence to that stance. US Treasury Secretary Steven Mnuchin reiterated the Trump administration’s emphasis on defending America against what it sees as unfair trade practices, and called on the IMF to do more in its watchdog role. His comments came just hours after a meeting of G20 finance ministers in Washington which saw Germany’s Wolfgang Schaeuble say there was “broad agreement” that “free trade is better for global growth.” “There was a broad consensus” that “protectionism would be damaging to the global economy and the concerned economies as well,” the German minister, whose country holds the rotating G20 presidency, told reporters. That seemed to mark a striking change of tone since the last finance ministers meeting in Germany, one month ago, when the United States prevented the G20 from including a traditional pledge against protectionism in its final communique, calling the language “irrelevant.” It was unclear how far the renewed “consensus” extended. The group did not release a communique this time, and Mnuchin’s statement appeared to weaken Schaeuble’s declaration of unity. Rising protectionist and anti-globalization sentiment in key economies has created a tense atmosphere at the normally placid and formulaic gathering of finance ministers, where the G20 officials met ahead of a semi-annual meeting Saturday of the International Monetary Fund. Concerns have been fuelled by President Donald Trump’s threats to impose tariffs on countries that have trade surpluses with the United States, by the British decision to leave the European Union, and anti-internationalist rhetoric by some candidates in the French presidential election campaign. In a short but tough statement, Mnuchin said the United States “will continue to promote an expansion of trade with those partners committed to market-based competition, while more rigorously defending ourselves against unfair trade practices.”