World fi­nance of­fi­cials re­ject anti-trade at­tacks

Malta Independent - - BUSINESS -

More pro­tec­tion for work­ers harmed by free trade is the best way to counter grow­ing at­tacks on glob­al­iza­tion, say world fi­nance lead­ers dis­dain­ful of new trade bar­ri­ers.

Trea­sury Sec­re­tary Jacob Lew on Satur­day urged the 189-na­tion In­ter­na­tional Mone­tary Fund to "more boldly and force­fully" push mem­ber coun­tries to pur­sue all eco­nomic pol­icy op­tions to spur growth.

In the face of a back­lash against glob­al­iza­tion, Lew said it was im­por­tant to en­sure broad shar­ing of the ben­e­fits from ex­panded trade.

"We must not close our­selves off to the world, but rather re­dou­ble our com­mit­ment to en­sur­ing shared growth," Lew told the IMF's pol­icy com­mit­tee.

Global fi­nance of­fi­cials were con­clud­ing three days of talks Satur­day with meet­ings of the pol­icy com­mit­tees of the IMF and its sis­ter lend­ing or­ga­ni­za­tion, the World Bank.

The meet­ings come at a time grow­ing un­hap­pi­ness with glob­al­iza­tion, re­flected in a June vote in Bri­tain to leave the Euro­pean Union and the pres­i­den­tial cam­paign of Repub­li­can nom­i­nee Don­ald Trump, who has fo­cused on his com­plaints about il­le­gal im­mi­gra­tion and Amer­ica's huge trade deficits.

Trump has threat­ened to im­pose puni­tive tar­iffs on coun­tries such as China and Mex­ico that he feels are pur­su­ing un­fair trade prac­tices and cost­ing mil­lions of Amer­i­can jobs.

But of­fi­cials at these meet­ings say that a decades-long ef­fort to tear down trade bar­ri­ers has lifted mil­lions of peo­ple in poor na­tions out of poverty. Of­fi­cials say the prob­lem is that not enough has been done to protect work­ers who have lost jobs be­cause of the greater com­pe­ti­tion from de­vel­op­ing coun­tries.

Ja­panese Fi­nance Min­is­ter Taro Aso told re­porters that coun­tries need to do more to re­move ob­sta­cles to free trade at a time of pro­tec­tion­ist sen­ti­ment. He said free trade had ex­panded the global econ­omy since World War II and re­mained cru­cial for driv­ing global growth.

Added IMF Man­ag­ing Di­rec­tor Chris­tine La­garde: "If we re­ally want jobs and higher in­come, if we care about poverty re­duc­tion and eco­nomic fair­ness ... if we care about growth, then we need to be se­ri­ous about fos­ter­ing global trade and about mak­ing sure that global trade works for all."

World Bank Pres­i­dent Jim Yong Kim noted the "tremen­dous anger against trade." But, he said, "We are here be­cause we be­lieve in our mission of end­ing ex­treme poverty," Kim said. "We are not go­ing to do it with­out more ro­bust trade."

Be­fore the IMF and World Bank meet­ings, fi­nance min­is­ters and central bankers of the Group of 20 ma­jor economies re­newed a pledge to uti­lize all the pol­icy tools at their dis­posal to com­bat what has been an ane­mic global re­cov­ery from the Great Re­ces­sion trig­gered by the 2008 fi­nan­cial cri­sis.

The G-20 in­cludes tra­di­tional eco­nomic pow­ers such as the United States, Ger­many and Ja­pan and emerg­ing economies such as China, Brazil and In­dia.

Con­cerns about fi­nan­cial mar­kets were high­lighted ear­lier Fri­day when the Bri­tish pound plunged sharply, slid­ing 6 per­cent in just a cou­ple of min­utes to its low­est level in more than three decades, be­fore re­bound­ing.

Bri­tish Trea­sury chief Philip Ham­mond, in Wash­ing­ton for the fi­nance meet­ings, said the plunge was the re­sult of a grow­ing re­al­iza­tion of in­vestors that Bri­tain is pro­ceed­ing with plans to leave the EU. Mar­kets have also been roiled in re­cent days by wor­ries about the health of Ger­many's largest bank, Deutsche Bank.

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