The Group of 20 finance ministers’ statement that trade tensions have “intensified” puts the onus on the United States and China to solve their trade dispute, European Union Commissioner for Economic Affairs Pierre Moscovici said on Monday.
Moscovici, who spoke in Tokyo after attending the G20 finance ministers’ meeting in Fukuoka over the weekend, expressed hope that the United States and China could reach an agreement at a G20 leaders’ summit in Osaka later this month. The G20 finance ministers’ statement issued on Sunday said trade and geopolitical tensions have “intensified”, raising risks to improving global growth.
“The road map is set to go further, and this means two things,” Moscovici told a news conference. “First is reforming the World Trade Organization; second is finding bilateral solutions. There we expect the United States and China to find a way to get to an agreement. Maybe the Osaka summit will be an important moment for that.”
The United States and China have levied tit-for-tat tariffs on each other’s goods as U.S. President Donald Trump’s administration renegotiates trade relationships to address practices it considers unfair. After fiery negotiations that nearly aborted the issuance of a communique, finance ministers and central bank governors repeated tepid support for a rules-based multilateral trading system.
The communique stopped short of calling for a resolution of the U.S.-China trade conflict.The communique was the best outcome possible from the EU’s perspective, because it used the word “intensifying” to describe the fraught stand-off between the world’s two largest economies, Moscovici said.
The widening fallout from the U.S.-China trade war has tested the resolve of the group to show a united front as investors worry if policymakers can avert a global recession. U.S. Treasury Secretary Steven Mnuchin has said that Trump and Chinese President Xi Jinping would meet at a June 28-29 G20 summit in Osaka, but the meeting has not been confirmed by China.
The planned meeting was said by Mnuchin to have parallels with the two presidents’ Buenos Aires meeting on Dec. 1, when Trump was poised to increase tariffs on $200 billion of Chinese goods.
Trump took that step in May and will be ready to impose similar 25% tariffs on a remaining $300 billion list of Chinese goods around the time of the Osaka summit.