'US troops coming to the ramparts' to defend trade interests, US commerce chief says

US Secretary of Commerce Wilbur Ross at the World Economic Forum annual meeting in Davos, Switzerland, on Jan 24, 2018. PHOTO: REUTERS

DAVOS, Switzerland (AFP) - US officials moved to reassure the World Economic Forum at the Davos summit that "America First" did not mean going it alone, but US Commerce Secretary Wilbur Ross also warned that in trade, "US troops are now coming to the ramparts" to defend American interests.

In response, French President Emmanuel Macron and German Chancellor Angela Merkel laid out defences of the liberal world order against the trade protectionism espoused by US President Donald Trump.

But they acknowledged the system would have to be overhauled.

"Globalisation today is going through a major crisis" and "those who have been left behind" must be defended, Macron said in a speech.

"The question is to know if we are able to recreate a true global contract that does not only belong to governments." But in a challenge to protectionists, the French leader added: "Those that don't want to move forward should not block the most ambitious people in the room."

At Davos, France and Germany urged world powers and businesses on Wednesday (Jan 24) to make globalisation serve the masses and not just the few. The European heavyweights stepped up to position themselves as a counterweight to Trump's "America First" agenda.

Macron shared the billing on Wednesday's Davos schedule with Merkel in a double-act dubbed "Merkron" by various media.

"Shutting ourselves off, isolating ourselves, will not lead us into a good future. Protectionism is not the answer," the German leader said in her own speech.

"Let us keep pace with the best in the world and let us canvas for this multilateral approach."

Merkel was late in confirming that she would attend Davos, tearing herself away from efforts to form a new government after an election setback in September.

Macron on the other hand is flying high, touting domestic economic reforms during an hour-long speech in English and French. "France is back at the core of Europe," he declared.

A former banker, Macron is a darling of Davos - the antithesis to Trump.

The 40-year-old French leader arrived in the Swiss ski resort after rallying some 140 chief executives at a meeting in the Palace of Versailles on Monday in his drive for a business "renaissance". Many of the bosses were in Davos, too.

Macron also defended gender equality, another prominent topic at Davos this year and even more delicate in light of Trump's past remarks about women.

As delegates wondered what the abrasive US leader will say in his speech on Friday to the liberal Davos jet-set whom he ridiculed during his election campaign, Treasury Secretary Steven Mnuchin moved to smooth the way for his arrival.

"This is about an America First agenda but America First does mean working with the rest of the world," he said, before Merkel and Macron's appearances.

"It just means that President Trump is looking out for American interests, no different than other leaders look out for their own."

Trump's harsh stance on trade angered China and South Korea this week with new tariffs on solar panels and large washing machines.

Commerce Secretary Ross defended the tariffs and said Washington would not flinch from reprisals against countries that flout the rules.

"Trade wars are fought every single day... and unfortunately every single day there are various parties violating the rules and trying to take unfair advantage," Ross said.

"Trade wars have been in place for quite a little while. The difference is the US troops are now coming to the ramparts."

The man behind China's economic policy also took the stage at Davos on Wednesday, pledging to further open the country to the world in a direct echo of President Xi Jinping's speech at the forum last year.

Liu He, Xi's main economic advisor, promised foreign companies greater access to China's financial services market, manufacturing and some service industries.

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