Meeting at G20 reveals big gap
China, US stress cooperation despite differences
Finance chiefs of China and the US on Saturday stressed the need to enhance bilateral economic cooperation, but their diplomatic statements were overshadowed by vast differences between the world’s two largest economies on free trade policies, which were on vivid display during the meeting of the G20 finance ministers in Germany over the weekend.
Chinese Finance Minister Xiao Jie and his US counterpart, US Secretary of the Treasury Steven Mnuchin, agreed after a meeting that economic cooperation between China and the US will benefit both countries as well as the world economy and that their countries need to further strengthen economic cooperation, the Xinhua News Agency reported on Sunday.
The statement came after the two ministers pursued contradictory paths at the first G20 finance ministers meeting after US President Donald Trump, who has been signaling a protectionist approach in trade, took over the White House.
Mnuchin reportedly, in defending Trump’ policies, rebuffed a concerted effort by other finance chiefs to oppose protectionism, while Xiao stressed firmly fighting against protectionism.
Jiang Yong, a research fellow at the China Institute of Contemporary International Relations, said such dynamic provided a clear picture of the bumpy road ahead for Sino- US economic relations under Trump.
“They will say what they have to say when they meet as diplomats, but the fact is that there will be increased conflicts between the two countries,” Jiang told the Global Times on Sunday. He added that while the US is not against free trade, Trump is determined to take protectionist actions against foreign industries to protect domestic ones.
He said that as the US is likely to target “medium- to high- level manufacturing,” China will have support from countries in Europe in fighting against protectionism coming out of the US, despite its strong dominance in global trade.
That dominance was on display at the G20 finance ministers meeting in Germany. In a communiqué issued after the meeting, earlier statements to “resist all forms of protectionism,” which were agreed to by the G20 finance ministers at a meeting last year in China, were dropped.
Mnuchin claimed that earlier statements were not “relevant” for him because this is his first G20 meeting, Bloomberg reported on Sunday. He also failed to deliver a clear vision of the Trump administration’s trade policies under its “America First” principle.
Xiao, in pointed remarks both at the G20 meeting and at a meeting of finance ministers of the BRICS countries, stressed that countries should “unswervingly oppose trade protectionism” and called for cooperation, according to statements posted on the Chinese Ministry of Finance’s website.