sunny.png
Monday July 15th, 2019 2:15PM

Trade war clouds outlook as finance chiefs meet in Japan

By The Associated Press
Related Articles
  Contact Editor

FUKUOKA, Japan (AP) — Finance ministers and central bank governors meeting in Japan this weekend will try to make headway on longstanding issues such as how much global giants like Facebook and Amazon should pay in taxes.

They're likely to end up focusing a large share of their attention, however, on how to keep global growth on track when the world's two biggest economies are entrenched in an escalating trade war.

U.S. Treasury Secretary Steven Mnuchin, who has headed trade talks with Beijing along with U.S. Trade Representative Robert Lighthizer, was due to meet with Yi Gang, governor of China's central bank, on the sidelines of the G-20's annual financial gathering in Fukuoka in southern Japan.

But it was unclear if their meeting, a possible prelude to talks at the G-20 summit later this month between President Donald Trump and Chinese President Xi Jinping, might lead to a restart of those talks after weeks of stalemate.

As the Trump administration prepares to expand retaliatory tariff hikes of up to 25% to another $300 billion of Chinese products, Beijing has sought to highlight China's capacity to endure and overcome hardship.

Yi told Bloomberg Television in an interview broadcast Friday that he expected the meeting with Mnuchin to be "difficult." But he said China's central bank, the People's Bank of China, had plenty of room to maneuver to help keep the economy growing despite the pounding the country's export manufacturers are taking as the toll from higher tariffs mounts.

Speaking Thursday in France, Trump said he plans to make a decision about ramping up tariffs on China after speaking with Xi at the summit in Osaka at the month's end.

"I will make that decision I would say over the next two weeks — probably right after the G-20," he said.

The Trump administration began slapping tariffs on imports of Chinese goods nearly a year ago, accusing China of resorting to predatory tactics to give Chinese companies an edge in advanced technologies such as artificial intelligence, robotics and electric vehicles. These tactics, the U.S. contends, include hacking into U.S. companies' computers to steal trade secrets, forcing foreign companies to hand over sensitive technology in exchange for access to the Chinese market and unfairly subsidizing Chinese tech firms.

Trump has also complained repeatedly about America's huge trade deficit with China — a record $379 billion last year — which he blames on weak and naive negotiating by previous U.S. administrations.

The United States now is imposing 25% taxes on $250 billion in Chinese goods. Beijing has counterpunched by targeting $110 billion worth of American products, focusing on farm goods such as soybeans in a deliberate effort to inflict pain on Trump supporters in the U.S. heartland.

Unease over trade tensions and their potential impact on other economies has deepened since Trump announced he would impose a 5% tax on Mexican products starting Monday — a tax that would reach 25% by Oct. 1 if the Mexican government fails to stop the flow of Central American migrants into the United States.

Trump said Friday in a tweet that there was a "good chance" to make a deal with Mexico. If so, "they will begin purchasing Farm & Agricultural products at very high levels, starting immediately. If we are unable to make the deal, Mexico will begin paying Tariffs at the 5% level on Monday!"

While the tariffs have taken a minor toll on the U.S. economy, the uncertainty and slowing demand are rippling across the globe. Earlier this week, the World Bank downgraded its forecast for the global economy in light of trade conflicts, financial strains and unexpectedly sharp slowdowns in wealthier countries.

The weakness has prompted central banks, most recently in Australia and India, to slash interest rates to fend off recession.

WASHINGTON (AP) — A sharp pullback in U.S. hiring for May intensified fears that the economy has weakened and that many employers have grown nervous, in part from President Donald Trump's escalating trade wars.

Yet the stock market soared and bond yields fell because investors found a reason to cheer: The tepid employment report magnified their expectations that the Federal Reserve will cut interest rates in the coming months, perhaps beginning in July, to support the economy.

Japan, hosting the G-20 for the first time since it was founded in 1999, has plumbed the limits of that strategy. The Bank of Japan's policy interest rate has been at minus 0.1% for years, to keep credit cheap and support a modest pace of expansion.

As the trade conflicts percolate, the officials gathering in Fukuoka, a bustling port city on the southern main island of Kyushu, will carry on chipping away at financial reforms and other perennial issues.

Some European members of the G-20, especially, want to see minimum corporate tax rates for big multinationals.

Japan's Kyodo News service reported Friday, citing a draft communique, that the finance leaders are also discussing the issue of how developing countries are handling debts incurred through major construction projects, efforts to combat money laundering and to prevent terrorist groups from using cybercurrencies as a source of funding.

  • Associated Categories: Associated Press (AP), AP Business, AP Business - Corporate News, AP Business - Economy, AP Business - Industries, AP Business - Financial Services
© Copyright 2019 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
Facebook stops Huawei from pre-installing apps on phones
Facebook stops Huawei from pre-installing apps on phones
9:41AM ( 4 minutes ago )
Warsaw's plastic palm tree 'dies' to mark climate threat
A giant plastic palm tree that has become an artistic symbol of Warsaw has "died" as part of a stunt to draw attention to climate change
9:38AM ( 8 minutes ago )
University of Alabama trustees meet on refunding $21M gift
The University of Alabama board of trustees is expected to vote Friday on whether to return a top donor's $21.5 million donation and strip his name from the law school
9:27AM ( 18 minutes ago )
Associated Press (AP)
Rights group asks for worker-safety probe at Tokyo Olympics
Human-rights watchdog group asks IOC, Tokyo Olympic organizers to investigate worker safety
9:05AM ( 41 minutes ago )
US employers add a weak 75,000 jobs; unemployment stays 3.6%
US employers pulled back on hiring in May, adding just 75,000 jobs; unemployment stays a low 3.6%
8:42AM ( 1 hour ago )
Conservative rivals battle as May exits, defeated by Brexit
Prime Minister Theresa May formally steps down as Conservative Party leader on Friday, defeated by the Brexit conundrum
8:36AM ( 1 hour ago )
AP Business
Solid US jobs report could allay fears of weakening economy
A solid US jobs report could allay fears of weakening economy
6:50AM ( 2 hours ago )
US-Mexico talks continue, Trump says more progress needed
Talks between US, Mexican officials continue as Trump's 5% Mexico tariff deadline looms
4:18AM ( 5 hours ago )
Asian stocks trail US rise on US-Mexico trade deal optimism
Asian shares are mostly higher on optimism about a possible trade deal between the US and Mexico before tariffs take effect
3:01AM ( 6 hours ago )
AP Business - Economy
The Latest: Probe finds 'state actor' led attack on tankers
International investigators say last month's attacks on oil tankers in a United Arab Emirates port were led by a foreign state
4:58AM ( 4 hours ago )
US commander says Mideast buildup prompted Iran 'step back'
US commander in Mideast: Iran appears to 'step back' in response to American buildup in Persian Gulf area
2:45AM ( 7 hours ago )
Japan plans carbon emission cuts, more nuclear energy
Japan is calling for further efforts to cut carbon emissions by promoting renewables but also nuclear energy despite the 2011 Fukushima reactors meltdowns
1:53AM ( 7 hours ago )
AP Business - Industries
After Fed, Europe also helps economy cope with trade war
The European Central Bank has taken action to support the economy in the 19 countries that use the euro, responding to fears about global trade conflicts
11:17AM ( 22 hours ago )
Car buyers' best cost-saving move: shop for a loan first
With the cost to own a new vehicle rising, it's more important than ever to consider what you'll pay for a car loan and to shop for the best interest rate
10:41AM ( 23 hours ago )
After Fed, Europe also helps economy cope with trade concern
The European Central Bank has taken action to support the economy in the 19 countries that use the euro, responding to fears about global trade conflicts
7:59AM ( 1 day ago )
AP Business - Financial Services
Facebook stops Huawei from pre-installing apps on phones
Facebook stops Huawei from pre-installing apps on phones
9:41AM ( 4 minutes ago )
Warsaw's plastic palm tree 'dies' to mark climate threat
A giant plastic palm tree that has become an artistic symbol of Warsaw has "died" as part of a stunt to draw attention to climate change
9:38AM ( 8 minutes ago )
University of Alabama trustees meet on refunding $21M gift
The University of Alabama board of trustees is expected to vote Friday on whether to return a top donor's $21.5 million donation and strip his name from the law school
9:27AM ( 19 minutes ago )
US employers add just 75,000 jobs as unemployment stays 3.6%
US employers pulled back on hiring in May, adding just 75,000 jobs; unemployment stays a low 3.6%
9:25AM ( 21 minutes ago )
Prominent investigative journalist detained in Russia
Russian police says a prominent investigative journalist is facing charges of drug dealing
9:24AM ( 21 minutes ago )