‘ Darker days ahead for global economy’

Berlin. June 12: International Monetary Fund chief Christine Lagarde led an attack by global economic organisations on US President Donald Trump’s “America First” trade policy on Monday, warning that clouds over the global economy “are getting darker by the day”.

Trump backed out of a joint communique agreed by G7 leaders in Canada at the weekend that mentioned the need for “free, fair and mutually beneficial trade” and the importance of fighting protectionism.

The US president, who has imposed import tariffs on metals, is furious about the US’ large trade deficit with key allies. “Fair trade is now to be called fool trade if it is not reciprocal,” he tweeted on Monday.

In response, Lagarde unleashed a thinly veiled attack on Trump’s trade policy, saying challenges to the way trade is conducted were damaging business confidence, which had soured even since the weekend G7 summit.

The Washington- based IMF is sticking to its forecast for global growth of 3.9 per cent both this year and next, she said, before adding: “But the clouds on the horizon that we have signaled about six months ago are getting darker by the day, and I was going to say by the weekend.”

“The biggest and darkest cloud that we see is the deterioration in confidence that is prompted by ( an) attempt to challenge the way in which trade has been conducted, in which relationships have been handled and in which multilateral organizations have been operating,” Ms Lagarde said.