NUSA DUA (Bali) • US Treasury Secretary Steven Mnuchin pushed back yesterday against warnings that Washington's trade fight with China imperils the world economy, saying that pushing Beijing to open up will be good for all.
The International Monetary Fund (IMF) has warned at annual meetings in Bali that the escalating United States-China trade confrontation would hobble global economic growth, as the fund lowered its forecasts for this year and next.
But Mr Mnuchin told reporters on the Indonesian resort island that President Donald Trump's drive to punish China with tariffs, to encourage it to adopt fairer trade practices, would have the opposite affect.
"Our objective with China is very clear: it's to have a more balanced trading relationship," Mr Mnuchin said. "I think that if we are successful, this is very good for US companies, US workers, Europeans, Japan, all of our other allies, and good for China."
Mr Mnuchin said, however, that the IMF's warnings were "all the more reason" for China to be incentivised to address these issues with the US.
The IMF on Tuesday cut its outlook for global gross domestic product growth by 0.2 percentage point to 3.7 per cent for 2018 and 2019, saying that "everyone is going to suffer" from a clash between the world's two biggest economies.
Tensions have soared in recent months, with the Trump administration rolling out billions of dollars in tariffs against China in a bid to reduce the trade deficit and rein in what Washington views as unacceptable trade practices by the Asian giant.
"Our objective is to increase exports and have a more balanced, fair relationship where our companies can do business there on terms that are similar to how they can do business (in the US)," Mr Mnuchin said.