Japan, China agree trade war will harm global economy

Wang Yi, China's foreign minister, and Taro Kono, Japan's foreign minister, pose during a photo session ahead of a high-level Japan-China economic dialogue in Tokyo, Japan, on April 16, 2018.
Wang Yi, China's foreign minister, and Taro Kono, Japan's foreign minister, pose during a photo session ahead of a high-level Japan-China economic dialogue in Tokyo, Japan, on April 16, 2018.PHOTO: REUTERS

TOKYO (REUTERS, AFP) - Japan and China agree that a trade war will have serious consequences for the world economy, Japanese Foreign Minister Taro Kono said on Monday after a high-level economic dialogue between the world’s third- and second-largest economies. 

Concern is growing about a trade row between China and the United States in which the two nations have threatened each other with tariffs. Japan has been criticised by US President Donald Trump on trade and been hit with tariffs on steel and aluminium, but it has not yet threatened counter-tariffs.

“We have shared understanding that a trade war, no matter which country has brought it about, would have a very large impact on the prosperity of the international economy,” Kono told reporters after the first such dialogue in more than seven years.

Kono and the Chinese government’s top diplomat, State Councillor Wang Yi, co-chaired the Tokyo meeting. Wang is also China's foreign minister.

Wang said China and Japan should jointly oppose trade protectionism, safeguard multilateral trade systems, and together promote an open world economy, according to a statement from China's Foreign Ministry.

Financial markets have been roiled recently over fears that a full-blown U.S.-China trade war could shatter global trade and economic growth.

Trade issues will likely be at the forefront of a summit between Japan’s Prime Minister Shinzo Abe and President Trump later this week.

Tokyo is eager to avoid being pushed into talks on a two-way free trade agreement aimed not only at market access but at monetary and currency policies. Kono also said it was possible that Japan works with China on Beijing’s Belt and Road projects.

 

“It is quite possible that Japan cooperates with China on various (Belt and Road) projects on a case by case basis where international standards are met,” Kono said.

Chinese President Xi Jinping’s Belt and Road Initiative, unveiled in 2013, aims at building a modern-day Silk Road connecting China by land and sea to Southeast Asia, Central Asia, the Middle East, Europe and Africa.

Abe and Xi pledged last year to reset the sometimes touchy relationship between Asia’s two largest economic powers.

Wang, who spent eight years in Japan as a diplomat including three as ambassador, said the changing economic climate presented fresh opportunities.

“After reopening these talks, we’re both standing at new starting points to discuss future cooperation that will, I hope, lead to fresh economic growth for both nations,” Wang said at the start of the economic dialogue.

Relations between the pair are entering an "important phase of improvement and growth", Mr Wang added, on a rare visit by a top Chinese official to Japan.

Wang is the first Chinese foreign minister to visit Japan in a bilateral context in nine years. He and Kono discussed a broad range of issues, including North Korea, on Sunday night.

Relations between the pair are entering an "important phase of improvement and growth", Mr Wang added, on a rare visit by a top Chinese official to Japan.

Tokyo is battling to stay relevant amid a string of summits on North Korea's nuclear programme, in which Beijing is likely to be a major player.

With this in mind, Japan is pushing to host a trilateral meeting between Prime Minister Shinzo Abe, Chinese Premier Li Keqiang and South Korean President Moon Jae In.

Bilateral visits by Mr Abe and Chinese President Xi Jinping are also being planned.

China demonstrated its significant influence over its reclusive ally when Mr Xi hosted the North's leader, Mr Kim Jong Un, and his wife in Beijing last month.