US-Mexico deal is significant and positive for world economy, say G-20 ministers

Semi-trucks cross the border at the Zaragoza International Bridge, in Juarez, Mexico, across the border from El Paso, Texas, on May 31, 2019.
Semi-trucks cross the border at the Zaragoza International Bridge, in Juarez, Mexico, across the border from El Paso, Texas, on May 31, 2019.PHOTO: AFP

FUKUOKA (AFP, BLOOMBERG) - US Treasury Secretary Steven Mnuchin on Saturday (June 8) hailed a deal between the United States and Mexico on tariffs and immigration as "very, very significant" with a "very important outcome".

Speaking to reporters on the sidelines of the G-20 finance ministers and central bank governors, Mr Mnuchin said: "We couldn't be more pleased with the agreement that we reached. It is very, very significant and we very much appreciate the commitments that Mexico has made to help us on those important immigration issues."

Late on Friday, Washington and Mexico City reached an 11th-hour deal to crack down on migration from Central America, with President Donald Trump relenting on threats to slap potentially devastating tariffs on the neighbouring country.

With Mr Trump ready to impose 5 per cent tariffs on all Mexican goods starting on Monday, senior officials hammered out an agreement after three days of intense negotiations at the State Department.

"As a result of (the deal), the President agreed that we will not be moving forward with the tariffs so that was a very important outcome," Mr Mnuchin said.

Indonesian Finance Minister Sri Mulyani Indrawati and Bank of Japan Governor Haruhiko Kuroda said the US-Mexico deal is a clear positive for the world economy.

Ms Indrawati said the move also signalled a broader US willingness to compromise on its trade conflict with China, describing it as "very plus plus" in an interview with Bloomberg Television in Fukuoka, Japan, where finance and central bank chiefs from the G-20 nations are meeting this weekend.

 
 

Speaking separately to reporters, Mr Kuroda said the impact of Mr Trump's decision reached beyond the two countries involved and would be great for the global economy, though he cautioned that trade-related issues still loomed large on the list of uncertainties for the economic outlook.

The remarks came during a morning devoted to the challenges of raising tax from the digital economy, one of many questions on the minds of G-20 finance ministers and central bankers struggling to shore up growth amid trade tensions and a global slowdown.