US MAKES TRADE DEMANDS AMID GLOBAL SLOWDOWN THREAT

BUENOS AIRES— The United States demanded that Europe and Japan sign a free trade deal to resolve the stiff tariffs the world’s largest economy slapped on its allies.

“If Europe believes in free trade, we’re ready to sign a free trade agreement,” US Treasury Secretary Steven Mnuchin said at a G-20 finance ministers meeting dominated by trade tensions.

Mnuchin said such a deal would require the elimination of tariffs, nontariff barriers and subsidies.

“It has to be all three issues,” he said.

French resistance

But Mnuchin’s overtures faced stiff resistance from France which refused to trade talks unless the United States first withdraws its stiff tariffs.

“We refuse to negotiate with a gun to our head,” said French Finance Minister Bruno Le Maire.

International Monetary Fund (IMF) Managing Director Christine Lagarde also attended the summit and warned that stiff tariffs would significantly harm global growth if the exchange of stiff tariffs remained.

World slowdown

“It certainly indicates the impact that it could have on GDP (gross domestic product), which in the worst case scenario under current measures... is in the range of 0.5 pct of GDP on a global basis,” Lagarde said.

German Finance Minister Olaf Scholz said he would use the meeting to advocate for a rules-based trading system, but that expectations were low.

Bank of Japan Governor Haruhiko Kuroda said he hoped the debate at the G-20 gathering would lead to an easing of retaliatory trade measures.

Mnuchin’s offer to the European Union and Japan—along with a renewed bid to restart talks with Mexico and Canada—came as the United States and China are also disputing stiff tariffs.

Mnuchin was tasked to rally G-7 allies to join the United States in more aggressive action against China, but they may be reluctant to cooperate because of the US tariffs.

China in the middle

The world’s two largest economies have slapped tariffs on $34 billion worth of each other’s goods so far.

On Friday, Trump threatened to impose even more tariffs on all $500 billion worth of Chinese exports to the United States unless China agrees to major structural changes to its technology transfer, industrial subsidy and joint venture policies.