The recent summit held in Buenos Aires, Argentina by the Group of Twenty ended in a disappointing note, as there were no agreements or solutions to President Trump’s trade wars. The meeting saw several finance ministers from all around the world, who had reportedly been discussing how the president’s recent actions surrounding trade could be damaging for the entire world. After two days of talks, all the ministers sent a joint final statement, where they expressed how continuing trade wars could depress growth in the global economy. The document stated:
Growth has been less synchronized recently and downside risks over the short- and medium-term have increased. These include rising financial vulnerabilities, heightened trade and geopolitical tensions, global imbalances, inequality and structurally weak growth, particularly in some advanced economies.”
Some events previous to the meeting shaped the conversations into ones that were more focused in finding solutions, rather than attempting to defend U.S. measures. The International Monetary Fund had stated that the world’s economic output could possibly decrease in $430 billion by the end of the decade. In fact, IMF argued that the tariffs are not even beneficial to the United States, who could find themselves to face an unmanageable amount of retaliatory tariffs from several countries. The director of the fund urged world leaders to work their situations via diplomacy and international cooperation since these measures would not have a positive outcome.
However, unsurprisingly, the Trump administration has chosen to ignore any negative projection to their actions and disagreed with the IMF’s statements. Treasury Secretary Steven Mnuchin denied the increasing danger that the U.S. could potentially face in the near future, and that the tariffs will only hurt some industries yet not the economy as a whole. This can be considered to be quite untrue, as the country’s trade wars tackle several areas in the economy: from the apparently failed negotiations to revive the North American Trade Agreement, to the scaling and consecutive tariffs with China and the backlash and retaliatory measures from European countries. The latter of which seems to be especially concerning, as several EU members are currently working on trade deals to maintain a well-functioning economy.
After the meeting, the representative of France stated: “World trade cannot base itself on the law of the jungle, and the unilateral increase of tariffs is the law of the jungle. We call on the United States to see sense, to respect the rules of multilateralism and to respect their allies.” Based on his conclusions, and those of other leaders, we can only assume that Mnuchin didn’t really do much to help foreign relations at the summit, which seems to have become a trend for the Trump administration.
Similar situations occurred during the president’s meetings with the G7 and NATO allies. In fact, Mnuchin’s main goal for this meeting was to work on convincing other countries into pressuring China, so that they would change their trade practices. This approach doesn’t leave any space for the Trump administration to compromise or admit that the tariffs will not work as an effective trade measure.
Featured image via Wikipedia