US says not seeking trade war, but is not afraid of one

BUENOS AIRES: The United States is not seeking a trade war over tariffs but does not fear one, US Treasury Secretary Steven Mnuchin said on Tuesday after a meeting of G20 finance ministers.

A trade war “is not our goal, but we are not afraid of it”, he said at the end of the two-day meeting in Buenos Aires aimed at averting a crisis sparked by looming US tariffs on steel and aluminium.

“We have to be prepared to act in the US interest to defend free and fair reciprocal trade. In doing that there is always a risk,” he said. “That’s not our goal. But we are not afraid of it.”

Mnuchin was speaking after ministers agreed not to condemn the US move in the meeting’s final statement, but instead spoke of “heightened economic and geopolitical tensions”.

“Downside risks persist and, over the medium term, challenges remain to raise growth and make it more inclusive,” the ministers from the most developed and emerging economies said.

The final communique, approved three days before US trade tariffs on steel and aluminium go into effect, comes as the world’s two biggest economies – the US and China – clash over trade rules, in which European and other US allies could sustain collateral damage.

“There is a desire to see China open their markets so we can participate in their markets they way they participate in ours, in a much more balanced and reciprocal trading relationship,” the US Treasury chief said of the general view among his G20 counterparts.

On the tariffs row, he added that his delegation had “very productive conversations” with G20 allies.

“We sensed a willingness of the Americans to reduce tensions,” a French ministry source said after a meeting on Monday between France’s Finance Minister Bruno Le Maire and Mnuchin.

Mnuchin’s veiled threat was echoed by EU Economic and Financial Commissioner Pierre Moscovici, with a statement carrying the same hint of steel in a velvet-gloved hand.

“The EU does not want an escalation on trade, it does not want a trade war, but it is ready to react, even if our preferred option is dialogue,” he said. “Our countermeasures are ready.” – AFP