Mnuchin Optimistic on Trade Standoffs 04/22 10:01
The International Monetary Fund and the World Bank repeatedly warned at
their meetings this week that intensifying trade tensions could jeopardize a
healthy global economic expansion.
WASHINGTON (AP) -- The International Monetary Fund and the World Bank
repeatedly warned at their meetings this week that intensifying trade tensions
could jeopardize a healthy global economic expansion.
But U.S. Treasury Secretary Steven Mnuchin expressed cautious optimism
Saturday that countries could settle their differences without a trade war.
Mnuchin met during the past three days with financial officials from China,
Japan and Europe over a series of punitive tariffs unveiled by the Trump
administration against China and other trading partners.
In a session with reporters, Mnuchin refused to say how close the United
States was to resolving the various trade disputes, but he did say progress had
The United States and China are on the brink of what would be the biggest
trade dispute since World War II. Each has proposed imposing tariffs of $50
billion on each other's products; President Donald Trump is looking to impose
tariffs up to $100 billion more on Chinese goods.
In a speech earlier this month, Chinese President Xi Jinping vowed to open
China's market wider to foreign companies, raising hopes the dispute with
Washington could be resolved. Mnuchin said he discussed Xi's proposals with
Chinese officials. "We are cautiously optimistic," Mnuchin told reporters,
saying that he may soon travel to Beijing for further talks.
The Commerce Ministry in Beijing said Sunday that China welcomes a visit
from the U.S. to Beijing to discuss trade issues and confirms it has "received
information" regarding Washington's interest in such a trip.
Trade tensions dominated the three days of talks among top finance officials
attending meetings of the Group of 20 major economies, the 189-nation
International Monetary Fund and its sister lending agency, the World Bank.
The officials roundly criticized Trump's get-tough approach to trade, a
reversal of seven decades of U.S. support for increasing freedom in global
commerce. In his speech to the IMF's policy committee Saturday, Yi Gang, the
head of China's central bank, said that global growth could be hurt by "an
escalation of trade frictions caused by unilateral actions," an obvious
reference to America's threatened tariffs against China.
Mnuchin insisted that the United States was not trying to provoke a global
trade war but seeking to protect American jobs from unfair competition. "The
president has been very clear on what our objectives are," Mnuchin said. "We
are looking for reciprocal treatment. This is not about protectionism."
There were signs of conciliation. The U.S. dropped its objection to the
first increase in the World Bank's capital resources since 2010, clearing the
way for the bank's board to OK a $13 billion increase in its capacity to make
loans to poor countries. The move was tied to a package of reforms the U.S. had
Both the World Bank and IMF held meetings of their policy committees on
Saturday. In a closing communique, the IMF expressed concern that the rising
trade tensions could dim what at the moment are bright prospects for the global
economy, which is expected to grow this year at the fastest pace since 2011.
"Trade tensions are not to the benefit of anyone," said Lesetja Kganyago,
who leads the policymaking committee and is governor of the South African
Reserve Bank. "If there is a trade conflict, there could never be winners. We
could all only be losers."
On Friday, Mnuchin had called on the IMF to do more to police countries
running large trade surpluses, a role that has traditionally been left to the
Geneva-based World Trade Organization. The final IMF communique did state: "We
will work together to reduce excessive global imbalances in a way that supports
global growth." The communique did not spell out how this would be accomplished.