BUENOS AIRES • World financial leaders have pleaded for an endorsement of free trade amid worries about US metals tariffs and looming trade sanctions on China, but Trump administration officials said they would not sacrifice US national interests.
The Buenos Aires meeting of finance ministers and central bank governors of the world's 20 biggest economies on Monday was meant to discuss a brightening economic outlook, the future of work, cryptocurrencies like bitcoin, and corporate tax avoidance.
But trade dominated the discussions after United States President Donald Trump on March 8 announced global tariffs of 25 per cent on steel and 10 per cent on aluminium.
Mr Trump is expected on Friday to announce new tariffs on up to US$60 billion (S$79 billion) worth of Chinese technology and consumer goods annually, to punish Beijing over its drive to acquire US intellectual property, sources told Reuters.
Group of 20 (G-20) finance leaders fretted about the dangers that a potential trade war posed to world economic growth.
"The first risk is the risk of inward-looking policies and protectionism," European Commissioner for Economic and Financial Affairs Pierre Moscovici told reporters after the first day of talks.
Protectionism could damage growth, he added.
A draft G-20 communique seen by Reuters last week said something similar but it was not clear if it would be retained in the final version of the statement to be published yesterday and which has to be agreed by unanimity.
US Treasury Secretary Steven Mnuchin pushed back at the meeting, saying the US could not sacrifice its own interests so that the system worked.
"There's no doubt that the Secretary represents the President's very strong view that we believe in free trade," one US official told reporters.
"But the environment we're in now, where the expectation is America totally subordinates its national interests in order for the free trade system to work, is just one we don't accept. So, we've been very clear, we believe in free trade with reciprocal terms that leads to more balanced trade relationships," he said.
Others at the G-20 meeting shared Europe's concerns.
"There is a solid understanding among the global community that free trade is important," Mr Haruhiko Kuroda, Japan's central bank governor, told reporters.
G-20 finance leaders will likely reflect many members' concerns over "inward-looking" policies like protectionism in the communique to be issued, Japan's Vice-Finance Minister Minoru Kihara said.
In a sign that negotiations over the communique's wording were ongoing, however, another senior Japanese Finance Ministry official said disagreement remained over whether to address trade friction through a bilateral or multilateral framework.