Japan’s Aso ‘feels sorry’ for Mnuchin amid tariff outrage
G7 OFFICIALS FRUSTRATED AT US ALIENATION OF ITS HISTORICAL TRADING PARTNERS
US Treasury Secretary Steven Mnuchin faced so much criticism from his Group of Seven counterparts this week over the new metal tariffs that Japanese Finance Minister Taro Aso said he almost “felt sorry” for the US finance chief.
“He’s not directly in charge of the metal tariffs, so in that sense it was very tough for him,” Aso told reporters after the second day of G7 finance minister meetings in Whistler, British Columbia. “I felt sorry for him, but I guess it’s not the sort of issue I should sympathise with.”
The G7 officials expressed frustration over how the US is alienating its historical trading partners with new tariffs on steel. They cautioned the Americans are losing sight of the real challenges faced by the global economy, even as they held out hope of a change of heart.
“We will be divided — it will not be a G7, it will be a G6 plus one,” French Finance Minister Bruno Le Maire said in a Bloomberg Television interview at the meeting in a ski resort near Vancouver. “It is dangerous for growth, dangerous for the economic development of the world, and dangerous for our jobs in the EU.”
The trade disputes are hijacking a summit that was initially seen as an opportunity to tout the successes of the global economic upswing, and is severely testing the resiliency of economic ties among Western nations. Canada and the European Union have said they will take immediate steps to retaliate after the Trump administration imposed steel and aluminium duties on national security grounds.
High drama
Frictions in Whistler this weekend could foreshadow even more high-drama at a G7 leaders’ summit this week in Quebec that Trump will attend.
“We won’t negotiate under pressure. We will never accept to negotiate under pressure,” said Le Maire, adding that the EU should be granted an exemption to the metal tariffs.
The security designation used by Trump to justify the tariffs has been particularly grating to the Europeans and Canadians.
“We’re obviously all very disappointed as close allies and partners of the US that they have taken this step, especially as they’ve taken it on national security grounds,” UK Chancellor of the Exchequer Philip Hammond said in a separate interview with BNN Bloomberg Television. He said the leaders summit this week may offer an opportunity to resolve the dispute.
“We know that President Trump’s way of doing business is very personal and the fact that he is going to have direct interactions with the leaders of the countries most affected by these measures gives us hope,” Hammond said.
Mnuchin
Mnuchin, who is representing the US at this week’s meetings, bore the brunt of the attacks, and was scheduled to speak to reporters at the end of the meetings later yesterday.
German Finance Minister Olaf Scholz said the US levies on imported metals from the European Union, Mexico and Canada are probably illegal. Canadian Finance Minister Bill Morneau said he’ll “clearly” express his displeasure to Mnuchin with the protectionist measures.
“The decision by the US government to unilaterally implement tariffs is wrong, and — from my point of view — also illegal,” Scholz told reporters. “We have clear rules, which are determined at the international level, and this is a breach of those rules.”
Mnuchin held a string of bilaterals in the first few hours after his arrival in Whistler, meeting individually with Japan’s Aso, Scholz and Morneau. While a Treasury Department readout of the Aso meeting made no mention of trade coming up in the discussions, a Japanese finance ministry official said the trade dispute was discussed.
Mnuchin deflected some of the criticism, urging his counterparts to talk to Trump, according to Aso.
“He was in a tough spot, tough, tough,” the Japanese minister said. “In all honesty, this issue, I can’t do anything about it, you have to say it directly to Trump otherwise nothing will change.”
National security
In imposing the tariffs, Trump invoked a seldom-used section of a 1960s trade law that allows him to erect trade barriers when imports imperil national security. Trump in March imposed 25 per cent duties on imported steel and 10 per cent on aluminium, but he gave temporary reprieve to a handful of allies for further talks to take place.
That reprieve ended Thursday, prompting swift retaliation from Canada, which announced duties on $12.8 billion worth of US imports, ranging from steel to whiskey and maple syrup.