Published: Mon, April 23, 2018
Global Media | By Jackie Banks

United States tells International Monetary Fund to fight global trade imbalances

United States tells International Monetary Fund to fight global trade imbalances

"We agree that the IMF will need to consider the effects of technology and digitalisation in its macroeconomic analysis, including on inequality, productivity, labor and financial markets, fiscal policy, monetary policy, and measurement of the digital economy", it said.

The IMF's policymaking committee said on Saturday that a strong world economy was threatened by increasing tension over trade and countries' heavy debt burden.

The gathering of world finance ministers began with heightened anxiety about the potential damage a US-China trade war could do to the economic recovery but ended Saturday with a door open to negotiations.

Mei said China can conduct negotiations with the USA under World Trade Organization rules, and on the other hand prepare measures to firmly fight back the unilateral and unfair trade moves if both sides failed to reach deals via talks. Mnuchin said they also discussed China's planned further opening of some of the country's markets, a move that USA has encouraged and "appreciated".

For the second consecutive day, the Treasury Secretary said that the United States strongly supports recent efforts of the World Bank and the IMF to better track these risks and improve transparency through the debt sustainability frameworks and urge the robust application of the IDA Non-Concessional Borrowing Policy and IMF Debt Limits Policy. "They will discuss this issue", she said.

The US has resisted pressure to back off President Donald Trump's protectionist America First trade policies.

The US and China have proposed imposing tariffs of $50 billion on each others' products and Trump is looking to impose tariffs on up to $100 billion more of Chinese goods.

Regarding trade with Japan, Mnuchin said the United States administration wanted a bilateral trade agreement.

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Secretary Mnuchin indicated he is now involved in a "dialogue" with the Chinese government to resolve the trade dispute.

In a statement on Saturday to the International Monetary and Financial Committee, Yi said China would "vigorously" push forward the reform and opening of its financial sector, significantly relax market access restrictions, create a more attractive investment environment, strengthen the protection of intellectual properties, and actively expand imports.

"The president has been very clear on what our objectives are", Mnuchin said.

The IMF said upside and downside risks to the short-term outlook were broadly balanced, but beyond that they "clearly lean to the downside".

Mnuchin said China has been "very helpful" in supporting USA sanctions against North Korea, and he welcomed Kim's suspension of nuclear testing that was announced less than a day earlier.

Global cooperation "has served us so well and delivered more progress for more people than at any time in history", but is now being questioned, Lagarde said.

Mnuchin differed markedly from his counterparts, saying the risk to global growth was from unfair trade practices, rather than the trade tensions.

"I hope that these International Monetary Fund meetings will be marked by this spirit".

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