Washington (AFP) – The Group of 20 major economies have reached a “broad consensus” that a continued rise in protectionism would be damaging to the global economy, German Finance Minister Wolfgang Schaeuble said Friday.
“The general mood of the discussion was a broad agreement in the direction that free trade is better for global growth,” Schaeuble said following a meeting of G20 finance ministers in Washington.
“Protectionism would be damaging to the global economy and the concerned economies as well,” Schaeuble, whose country holds the rotating presidency of the G20, told reporters, adding: “There was a broad consensus.”
The ministers also agreed that growth must be made “more inclusive” in order to stem the rise of protectionism, he said.
“We need to tackle this, otherwise we will see more protectionism,” Schaeuble said, adding that officials had agreed on the “need to do more” to share the proceeds of growth more equitably.
Schaeuble deflected repeated questions about the stance of the United States, saying Treasury Secretary Steven Mnuchin had told his counterparts the incoming administration has not made any decisions on specific trade policies.
Rising protectionist sentiment in major economies, including President Donald Trump’s threats to impose tariffs on countries that have surpluses with the United States, created a tense atmosphere at the normally placid gathering of finance ministers.
The G20 officials were meeting ahead of the semi-annual meeting of the International Monetary Fund, which has flagged protectionism and possible trade wars as a threat the global economic recovery, which is finally gaining momentum.
German central bank chief Jens Weidmann said the G20 is focusing more on inclusive growth because “rising inequality puts strain on potential growth” and as a result “people become more disenchanted with globalization.”