G20 Finance Ministers Discuss Global Economic Stability

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Europe wants to keep G-20 language rejecting protectionism but the US wants reciprocal treatment or fair trade.

Last year, the group of the world's 20 largest economies vowed to "resist all forms of protectionism".

Finance ministers from 20 world powers have failed to reach an agreement to endorse free trade and rejection of protectionism in the face of USA opposition, according to the communique of the G20 participants.

The statement issued by finance ministers at the G20 meeting was milder than 2016's.

USA treasury secretary Steven Mnuchin has insisted that President Donald Trump's "America First" policy does not mean Washington is seeking to start "trade wars" with Europe.

The meeting of the most powerful economies' finance ministers in Germany this week will likely be dominated by talk about whether to commit to free trade, as previous meetings have - or implicitly accept that some countries may put up barriers, like tariffs, as Trump has promised. But whether the statement will steer clear of anti-protectionist language out of consideration for the increasingly protectionist United States under Trump is a focal point.

In an unusual turn of events, hinting growing tensions, German Chancellor Angela Merkel and Chinese President Xi Jinping emphasized in a telephone conversation the importance of free trade for a growing global economy, according to a statement from Merkel's office.

"It's not true we are not agreed", he said.

Finance ministers from 20 world powers have struggled at talks in Germany to find a common position on trade in the face of resistance from the United States. He said trade agreements need to be "free and fair" and balanced.

Mnuchin and Japan's Finance Minister Taro Aso are both in Germany to attend the Group of 20 meeting of finance ministers and central bank governors that opened Friday afternoon.

European countries and China are said to be pushing for a stronger stance in favor of free trade and cooperative, multi-country frameworks for trade such as the World Trade Organization.

The G20 countries are expected to issue a final communique reiterating that "excess volatility and disorderly movements" in exchange rates can have "adverse implications" for economic and financial stability. The finance ministers' meeting will pave the way for a summit of national leaders in Hamburg, Germany, on July 7-8. Without mentioning a country by name, he said, "Maybe one or the other important member state needs to get a sense of how worldwide cooperation works".

Trump's top trade adviser, Peter Navarro, previously accused Germany of using a "grossly undervalued" euro in order to gain advantage over the US and its own European Union partners.

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