US Treasury secretary Steven Mnuchin joined finance ministers from the worlds leading economies in highlighting the risk from “heightened trade and geopolitical tensions” at a G20 meeting marred by the continued dispute over tariffs.
A communique from the finance ministers and central bankers of major economies, including British chancellor Philip Hammond and Bank of England governor Mark Carney, acknowledged that there had been an increase in risks to global growth.
The meeting, which took place over two days in Argentine capital Buenos Aires, was dominated by discussions over tariff disputes which threaten to escalate into a full-blown trade war.
Read more: IMF: Trump's trade war is significantly harming world economic health
US President Donald Trump believes that tariffs will help the US to reduce its trade deficits with multiple countries. At the end of last week Trump said he would consider imposing levies on all $500bn of Chinese imports.
At the same time the US has infuriated traditional allies in the EU by imposing levies on billions of euros worth of imports, with economists expecting him to follow through with a threat to tax car imports.
"We refuse to negotiate with a gun to our head," French finance minister Bruno Le Maire told reporters on the sidelines of the G20 meeting yesterday.
Mnuchin, a former Goldman Sachs investment banker, claimed that the US is open to a trade deal with the EU.
"If Europe believes in free trade, we're ready to sign a free trade agreement" which would eliminate all tariffs, non-tariff barriers and subsidies, Mnuchin said, according to Reuters.
Read more: IMF warns of $440bn risk to global growth from Trump's trade war
The finance ministers communique emphasised the growing risks to the global growth outlook.
“Global economic growth remains and unemployment is at a decade low. However, growth has been less synchronized recently and downside risks over the short- and medium-term have increased," the communique said, according to Reuters.
"These include rising financial vulnerabilities, heightened trade and geopolitical tensions, global imbalances, inequality and structurally weak growth, particularly in some advanced economies."
The G20 meeting has come amid a strong lobbying effort from businesses across the world to try to force the White House to reverse course.
Dieter Kempf, head of Germanys powerful BDI industry association, told Die Welt newspaper: “Tariffs under the cover of national security should be abolished.” He added: “Europe should not be blackmailed and should be self-confident in its behaviour towards the United States.”
Christine Lagarde, managing director of the International Monetary Fund, again urged that trade conflicts be resolved "via international cooperation without resort to exceptional measures".
Meanwhile, web commerce giant Amazon, car manufacturer Toyota and aluminium producer Alcoa are all considering more forceful interventions to attack the tariffs, Reuters reported.
Read more: Trump's trade war to knock a fifth off US stock markets say UBS analysts
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