G20 wrangles on trade as it warns of risks to global growth

A draft communique seen by Bloomberg says 'trade and geopolitical tensions' remain risk factors for the global economy.

    Finance ministers at the G20 nations meeting in Japan are divided over the language on trade disputes for their final communique [File: Petar Kujundzic/Reuters]
    Finance ministers at the G20 nations meeting in Japan are divided over the language on trade disputes for their final communique [File: Petar Kujundzic/Reuters]

    Finance chiefs gathered in Fukuoka, Japan, for meetings of the Group of 20 are wrangling over language on how to describe global trade disputes in a communique that is to be published at the meeting’s conclusion.

    A fifth draft version of the statement seen by Bloomberg News referenced the need for a "pressing need to resolve trade tensions" amid an escalating conflict between the U.S. and China. The section of text on trade was in red, indicating agreement had yet to be reached

    Officials haven’t yet been able to agree on wording, with discussions expected to continue, according to two officials familiar with the discussions. Talks wrapped at 5:32 p.m. local time and will resume Sunday.

    In the draft communique, G-20 officials said global growth appears to be stabilizing, but risks remain skewed to the downside. Risks "include, in particular, intensified trade and geopolitical tensions. We will continue to monitor and address risks, and stand ready to take further action," it read.

    On currencies, the draft reiterates a pledge to not devalue in order to boost their economies’ competitiveness.

    The draft communique states that the G-20 will complete a review of the International Monetary Fund’s quotas by October. It also will back a push for greater debt transparency.

    Japanese officials are aiming to make their mark on the G-20 presidency by emphasizing global external imbalances as a high-priority issue, with Finance Minister Taro Aso pitching before the weekend’s meetings that greater debt transparency is needed, especially among lower-income countries.

    "We support the work of the Institute of International Finance on the Voluntary Principles for Debt Transparency to improve debt transparency and sustainability of private financing and look forward to follow up," the draft reads.

    SOURCE: Bloomberg