US hints at China truce as world warns of trade war
US treasury secretary Steven Mnuchin said he’s considering a trip to China amid a trade dispute with Beijing that finance chiefs warn could derail the global economic upswing.
Mnuchin said he’s “cautiously optimistic” of reaching an agreement with China that bridges their differences over trade.
“A trip is under consideration,” Mnuchin told reporters on Saturday in Washington at the IMF’s spring meetings. “I’m not going to make a comment on timing, nor do I have anything confirmed.”
China’s ministry of commerce said Sunday it is aware that the US is considering a visit to Beijing to negotiate economic and trade issues and welcomes such a move.
A visit by the US Treasury secretary to China could signal a breakthrough in the spat between the world’s two biggest economies, whose threats to slap tariffs on each other have rattled markets and raised fears of a trade war.
It would come at a sensitive time for the region’s geopolitics, with negotiations under way on a planned meeting between US President Donald Trump and North Korean leader Kim Jong-Un.
Mnuchin’s remarks came as finance ministers and central bankers at the IMF meetings gave their latest economic assessments, often citing trade as a threat looming over the strongest upswing in seven years.
Global growth has strengthened and is increasingly broad based, the IMF’s main advisory committee said Saturday. However, it noted that “rising financial vulnerabilities, increasing trade and geopolitical tensions,
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and historically high global debt threaten global growth prospects.”
IMF first deputy managing director David Lipton summed up the main takeaway he heard from officials at the meetings this week as “time’s are good but it’s getting risky.”
Mnuchin said he met with Yi Gang, governor of the People’s Bank of China, at the IMF gathering this week. The discussions focused on issues related to the Chinese central bank, not trade, said the secretary.
Mnuchin said they also discussed China’s planned further opening of some markets, a move that US has encouraged and “appreciated.”
“China will vigorously push forward the reform and opening-up of the financial sector, significantly relax market access restrictions, create a more attractive investment environment, strengthen the protection of intellectual properties and actively expand imports,” Yi said in a statement on Saturday.
China has announced plans to gradually remove foreign ownership caps for limits for car-, ship- and aircraft-makers.
JAPAN LIKELY TO SOFTEN STANCE AS US KEEPS UP HEAT
Despite calls to resist protectionism and for the United States to rejoin a multilateral TPP, Japan is gradually shifting gear to adjust to a trade environment shaken up by US President Donald Trump.
Japan’s finance minister Taro Aso said this week that inward-looking policies would destabilise markets and benefit no country.
Tokyo also sought to play down the rift emerging between Washington and its Group of 20 counterparts, with one official saying the proceedings on the sidelines of the International Monetary Fund and World Bank meetings this week were “hardly contentious.”
REUTERS
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