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The G-20 warns of the risk for growth by the commercial tension and calls to the dialogue

The trade war unleashed by Trump against China marks the meeting of finance ministers in Buenos Aires

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The G-20 warns of the risk for growth by the commercial tension and calls to the dialogue

The trade war arouses a growing concern. America's adamant stance on taxing Chinese imports eclipsed agenda of G-20 meeting of finance ministers and central bank leaders in Buenos Aires. Like IMF, representatives of world's highest economies warned of "increased trade and geopolitical tensions" and risk y pose for global growth. In final document, countries underscored importance of financial system remaining "open, silent, and supportive of growth," and called for reinforcement of dialogue.

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  • US ratifies G-20 trade war against China
  • The trade war marks agenda of G-20 finance ministers meeting in Buenos Aires

The world trade scenario has worsened since last meeting of finance ministers held in Buenos Aires in March. America's warnings to China and EU are now a reality since Donald Trump's government imposed a 25% tariff on Chinese products by 34 billion of dollars at beginning of month, which could add anor 16 billion. A 10% tax on goods valued at 200 billion is also under study.

The commercial tension was reflected this time in final document. "Growth has been less recently synchronized and medium and short term risks have increased," agreed text among all countries said. "These include growing financial vulnerabilities, increased trade and geopolitical tensions, global imbalances, inequality, and structurally weak growth, particularly in some advanced economies," he explained.

The Argentine Minister of Finance and Finance, Nicolás Dujovne, considered meeting a "success". Dujovne admitted existence of differences between members of G20 but valued search for consensus within G-20, a forum born to cope with global economic crisis. "In bad times is when you see how important it is," underlined Dujovne.

There are few protests on street demonstrators against IMF and G-20 in Buenos Aires. Ap

The Argentine government shielded Exhibition and convention Center for G20 meeting. The surrounding streets were cut, subway was closed and hundreds of police officers guarded place for fear of violent protests against encounter. But protests were lower than expected. Hundreds of people from left-wing parties, social and trade union organizations demonstrated on Saturday against G-20 and IMF but failed to reach CEC by security operative. The demonstrators criticized adjustment plan designed by government of Mauricio Macri to meet deficit reduction agreed with IMF in exchange for loan of 50 billion dollars.

Trump will attend G-20 summit

At end of meeting, US Treasury Secretary Steven Mnuchin reiterated intention that "China would move towards a more balanced trade" that would reduce current trade deficit of 505 billion dollars, according to its calculations. Mnuchin confirmed Trump's presence at G-20 leaders summit in Buenos Aires at end of November.

The G-20 ministers expressed mselves against protectionism. "The financial system must remain open, resilient and supportive of growth," y stressed in text. They also emphasized importance of conducting structural reforms to improve potential expansion and to avoid competitive devaluations that could have adverse effects on global financial stability.

The disagreement between United States and European Union has been evident in Buenos Aires. The European Commissioner for Economic and Financial affairs, Pierre Moscovici, warned at press conference of "risk of a greater escalation of protectionism". "Trade wars are not good for anyone, do not create winners, only damage," said Moscovici. "We call for reason to United States, to respect multilateral rules and to respect its allies," said French minister of Economy, Bruno Le Maire. "Americans and Europeans are allies. We cannot understand why we Europeans are affected by increase in trade tariffs decided by US, he added.

The Spanish Minister of Economy, Nadia Calviño, also expressed opposition to those who present "foreign trade as a threat or try to return to protectionist attitudes." In a meeting with European media, Calviño remarked beneficial role that foreign trade played in departure of Spain from its last economic crisis.

The cost of trade war is not yet quantifiable, but IMF has already warned that consequences will be seen in medium term. The fund's headline, Christine Lagarde, reiterated in Buenos Aires that "in worst-case scenario, current [commercial] measures can have an impact of about 0.5 [negative] points of global GDP" in 2020. Lagarde clarified that IMF takes into account impact of "measures announced and in process," but does not "speculate on what may come."

Argentina, host country of G20, proposed an agenda that discusses public policies around technological changes affecting employment and a commitment to more global investments in infrastructure, as well as effective regulation to phenomenon of Criptomonedas. But trade war has put everything else in background.

International support to Argentina

The recent economic storm has laid down Argentina's economic forecasts, but Mauricio MACRI's government maintains extensive international support. The Argentine President thanked support samples received during G-20 finance summit. In his closing speech, Macri admitted bad economic moment, but expressed his confidence that "accelerate pace in 2019."

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  • US ratifies G-20 trade war against China
  • The trade war marks agenda of G-20 finance ministers meeting in Buenos Aires

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