(BUENOS AIRES, Argentina) – The world's top financial officials called on Sunday for a dialogue on trade disputes that threaten global economic growth, with a warning that the differences may persist and tensions continue to escalate.
The two-day gathering of finance ministers and central bankers of the Group of 20 Nations took place when the United States quarreled over trade with China and other nations, with tariffs on billions of dollars of the other's goods.
A final communiqué states that despite a continued strong global economy, growth is "less synchronized" and risks have increased in the short and medium term.
"These include rising financial vulnerabilities, increased trade and geopolitical tensions, global imbalances, inequality and slow growth, especially in some advanced economies," the statement said. "We … recognize the need to strengthen dialogue and action to mitigate risk and build confidence."
On Friday, US President Donald Trump renewed his threat to cut tariffs to a total of $ 500 billion from China – roughly equivalent to all the goods Beijing delivers to the US every year. The White House has also imported another $ 200 billion This may lead to tariffs.
The United States has also imposed tariffs of 25 percent on steel and 10 percent on aluminum, including from Europe. China, the European Union, Canada, Mexico and Turkey have counteracted taxes on US goods. EU tariffs for American products include Harley-Davidson motorcycles, cranberries, peanut butter, playing cards and whiskey.
European Commissioner for Financial Affairs, Pierre Moscovici, warned that such disputes pose a threat.
"Protectionism, I want to insist, is good for nobody," Moscovici told reporters. "Trade wars are not easy … they do not make winners, only losses."
US Treasury Secretary Steven Mnuchin denies that protectionism is the problem.
"People are trying to do this about the United States and protectionism, which is not the case at all," he said at a press conference. "The point is that the United States wants fair and free trade … We very much support the idea that trade is important to the global economy, but it must be fair and reciprocal."
Mnuchin said there was no "substantive discussion" with China over the trade during the meeting. When asked what would be needed to resume talks with the Asian giant, he said, "Whenever they want to sit down and negotiate meaningful change, I and our team are available."
As the meeting gathered, Moscovici said that the differences persisted despite the talks.
"These meetings took place in an international context that is very challenging … The tensions in the trade remain high and continue to escalate," he said.
Christine Lagarde, managing director of the International Monetary Fund, warned that a tariff wave could weigh heavily on the global economy and, in the worst case scenario, reduce growth by about 0.5 percent.
Mnuchin disagreed with Sunday, saying that the US economy was not damaged by the trade disputes sparked by Trump's hard line. However, he acknowledged that some individual sectors were injured and said US officials are looking for ways to help them.
"We see some micro-influences where people, our colleagues, are looking for very, very specific things in very specific communities," he said. "But from a macroeconomic point of view, we do not yet see any significant impact on the economy."
So far, global markets have generally remained calm despite the trade war between the US and China and other trade conflicts.
However, analysts believe they expect Trump to impose more tariffs on China and possibly other major US trading partners. With these nations almost certain to retaliate, the result could be higher prices for Americans, reduced export sales and a weaker US economy until next year, they say.
Moscovici said the G20 meeting was not tense. He said that countries need to "stay cool and maintain a sense of perspective" and that the EU remains open to dialogue.
"That's why EU President Jean-Claude Juncker and EU Trade Commissioner Cecilia Malmstrom will meet Trump in Washington next week," he said. "We hope that this meeting will be productive and successful."
Mnuchin said the US is looking forward to these discussions.
The group of 20 nations consists of traditional economic powers such as the USA, Japan and Germany as well as emerging economies such as China, Brazil, India and Argentina.
Officials in Buenos Aires also discussed issues such as the future of work and infrastructure for development, the international tax system and financial inclusion. It is the third of five meetings of finance ministers and central bankers planned in the run-up to a meeting of the G-20 leaders in Argentina from 30 November to 1 December. Mnuchin said Trump plans to attend.
Associated Press author Patricia Luna and AP video journalist Paul Byrne have contributed to this report.