G20 agree trade issues threaten globe

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A fifth draft of the communique seen by Bloomberg News on Saturday included a reference to a "pressing need to resolve trade tensions", which was omitted in the final statement.

U.S. Treasury Secretary Steven Mnuchin met People's Bank of China (PBOC) Governor Yi Gang.

The world's top finance policymakers Sunday weighed the impact of ballooning trade tensions on the global economy amid differences over the extent to which they are dragging on growth.

"We discussed the ongoing close cooperation between the USA and Japan across a number of economic and security issues", Mnuchin said in a tweet.

Following 30 hours of wrangling in what one official described as a "tense" atmosphere, the G20 finance minister and central bank chiefs produced a final statement acknowledging that "growth remains low and risks remain tilted to the downside".

"Importantly, these results suggest that if the USA follows through on its threat to impose 25 percent tariffs on its remaining $300 billion of imports from China, it could lead to substantially more import substitution, given that a much larger proportion of this tranche of imports comprise of electronic products", said the report.

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U.S. Treasury Secretary Steven Mnuchin has reiterated that President Trump will decide whether to hit China with more tariffs after meeting with Chinese President Xi Jinping on the sidelines of the G20 world leader's summit in Japan later this month. "If not, as the president said, we'll move on with tariffs". The PBOC said in a statement that the two finance officials "exchanged views on global economic and financial situation, G20 issues, as well as topics of mutual interest".

"The two countries don't have any issues on this point", Aso told a news conference after a meeting of G20 finance leaders in Fukuoka, southern Japan.

Trump took that step in May and will be ready to impose similar 25% tariffs on a remaining $300 billion list of Chinese goods around the time of the Osaka summit.

Japan's Finance Minister Taro Aso (C) stands with International Monetary Fund managing director Christine Lagarde (L) and Bank of Japan governor Haruhiko Kuroda (R) before a family photo of the G20 finance ministers and central bank governors meeting in Fukuoka on June 8, 2019. They did not refer directly to the tariffs war between the United States and China, though leaders participating in the meetings indicated it was the No. 1 concern.

The widening fallout from the US-China trade war has tested the resolve of the group to show a united front as investors worry if policymakers can avert a global recession.

Relations between the United States and China have deteriorated since US President Donald Trump in early May accused Beijing of reneging on commitments to change its ways of doing business with the rest of the world. "We recognize the contribution that the multilateral trading system has made to that end".

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