BRICS Slam Protectionism as China-U.S. Spat Overshadows G20 Talks

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G20 leaders summit in Buenos Aires
U.S. President Donald Trump, Britain's Prime Minister Theresa May, French President Emmanuel Macron and Japanese Prime Minister Shinzo Abe wave hands during a family photo at the G20 leaders summit in Buenos Aires, Argentina November 30, 2018. REUTERS/Kevin Lamarque
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By Vladimir Soldatkin and Roberta Rampton
BUENOS AIRES (Reuters) 

Chinese President Xi Jinping and the leaders of major developing economies condemned protectionism at a G20 summit in Argentina on Friday overshadowed by U.S. President Donald Trump’s threat to escalate tariffs on China

This year’s two-day gathering is a major test for the Group of 20 industrialized nations, whose leaders first met in 2008 to help rescue the global economy from the worst financial crisis in seven decades.

 

G20 leaders summit in Buenos Aires
U.S. President Donald Trump and Russia’s President Vladimir Putin are seen during the G20 leaders summit in Buenos Aires, Argentina November 30, 2018. REUTERS/Marcos Brindicci TPX IMAGES OF THE DAY

 

With a rise in nationalist sentiment in many countries, the G20 – which accounts for two-thirds of the world population – faces questions over its ability to deal with trade tensions, which have roiled global markets.

Hanging over the summit in Buenos Aires is the trade dispute between the United States and China, the world’s two largest economies, which have imposed tariffs on hundreds of billions of dollars worth of each other’s imports after Trump launched an effort to correct what he views as China’s unfair commercial practices.

 

G20 leaders summit in Buenos Aires
Chinese President Xi Jinping attends the opening of the G20 leaders summit in Buenos Aires, Argentina November 30, 2018. REUTERS/Sergio Moraes

 

Global financial markets will take their lead next week from the outcome of talks between Trump and Xi over dinner on Saturday, aimed at resolving differences that are weighing on global economic growth.

Xi and other leaders from the BRICS group of leading emerging economies – Brazil, Russia, India, China and South Africa – issued a statement calling for open international trade and a strengthening of the World Trade Organization (WTO).

 

 

“The spirit and rules of the WTO run counter to unilateral and protectionist measures,” they said. “We call on all members to oppose such WTO-inconsistent measures, stand by their commitments undertaken in the WTO.”

Beijing hopes to persuade Trump to abandon plans to increase tariffs on $200 billion (156.8 billion pounds) of Chinese goods to 25 percent in January, from 10 percent at present.

 

G20 leaders summit in Buenos Aires
Saudi Arabia’s Crown Prince Mohammed bin Salman speaks with Russia’s President Vladimir Putin during the opening of the G20 leaders summit in Buenos Aires, Argentina November 30, 2018. REUTERS/Sergio Moraes TPX IMAGES OF THE DAY

 

U.S. stocks closed higher on Friday on hopes that a deal could be reached.

Trump said there had been some positive signs.

 

G20 leaders summit in Buenos Aires
U.S. President Donald Trump and Britain’s Prime Minister Theresa May speak as they attend the opening of the G20 leaders summit in Buenos Aires, Argentina November 30, 2018. REUTERS/Sergio Moraes

 

“We’re working very hard. If we could make a deal that would be good. I think they want to. I think we’d like to. We’ll see,” he said.

A Chinese foreign ministry official in Buenos Aires said there were signs of increasing consensus ahead of the discussions, although differences remained.

 

SEEKING COMMON GROUND

On the eve of the summit, G20 nations were still trying to reach consensus on wording for the summit’s communique on major issues including trade, migration and climate change, which in past years have been worked out well in advance.

 

G20 leaders summit in Buenos Aires
French President Emmanuel Macron and his wife Brigitte Macron look out from a car after arriving at Ministro Pistarini International Airport for the G20 leaders summit in Buenos Aires, Argentina November 28, 2018. Argentine G20/Handout via REUTERS

 

Officials hammering out the communique, known as “sherpas,” said they expected to work into the night.

“This has been an unprecedentedly long drafting,” said Russia’s sherpa, Svetlana Lukash. “It’s very complicated,” she said, adding that differences remained on all the key issues.

 

G20 leaders summit in Buenos Aires
French President Emmanuel Macron and U.S. President Donald Trump pose for a family photo during the G20 summit in Buenos Aires, Argentina November 30, 2018. REUTERS/Marcos Brindicci

 

Earlier in November, officials from countries attending a major Asia-Pacific summit failed to issue a joint statement for the first time after the U.S. delegation clashed with China over trade and security.

However, delegates to the Buenos Aires talks said good progress had been made on economic sections of the final communique. Argentina’s presidency voiced cautious optimism that consensus would be reached, but a White House official said the United States would walk away from any statement that prejudiced U.S. interests.

 

G20 leaders summit in Buenos Aires
Jared Kuchner receives the Order of the Aztec Eagle from Mexico’s President Enrique Pena Nieto before the G20 leaders summit in Buenos Aires, Argentina November 30, 2018. REUTERS/Kevin Lamarque

 

Highlighting the deep rifts within the G20, European Council President Donald Tusk said the European Union would extend its economic sanctions on Moscow in December, after Russian ships fired on Ukrainian vessels in the Sea of Azov last week, seizing the boats and sailors.

“As this is a difficult moment for international cooperation, I would like to appeal to the leaders to use this summit … to seriously discuss real issues such as trade wars, the tragic situation in Syria and Yemen and the Russian aggression in Ukraine,” Tusk told a news conference.

 

G20 leaders summit in Buenos Aires
Saudi Crown Prince Mohammed bin Salman prepares for a family photo during the G20 leaders summit in Buenos Aires, Argentina November 30, 2018. REUTERS/Kevin Lamarque

 

Trump cited Russia’s seizure of the ships as the reason he cancelled a planned bilateral meeting with Russian President Vladimir Putin, where they had been expected to discuss the U.S. leader’s threat to withdraw from the Cold War-era Intermediate-Range Nuclear Forces treaty.

Moscow said U.S. domestic politics may have been the real reason behind the cancellation after Trump’s former personal lawyer pleaded guilty on Thursday to lying to Congress about a proposed Trump Organization skyscraper in the Russian capital.

 

G20 leaders summit in Buenos Aires
Britain’s Prime Minister Theresa May arrives ahead of the G20 leaders summit in Buenos Aires, Argentina November 29, 2018. G20 Argentina/Handout via REUTERS

 

A White House spokeswoman denied this and Trump said on Friday the ships’ seizure was the “sole reason” he scratched the meeting.

A Kremlin spokesman said Putin was ready to continue talks with Trump.

 

LONELY SAUDI PRINCE

The presence of Crown Prince Mohammed bin Salman at the summit also raised an awkward dilemma for leaders, and Saudi Arabia’s de facto leader cut a lonely figure standing at the edge of the G20 family photo.

 

G20 leaders summit in Buenos Aires
U.S. President Donald Trump and first lady Melania Trump arrive ahead of the G20 leaders summit in Buenos Aires, Argentina November 29, 2018. REUTERS/Kevin Lamarque

 

Prince Mohammed arrived under swirling controversy over the murder of Saudi journalist Jamal Khashoggi in the Saudi consulate in Istanbul on Oct. 2. Human Rights Watch asked Argentine prosecutors to investigate him for human rights abuses.

U.S. Secretary of State Mike Pompeo and Saudi Foreign Minister Adel al-Jubeir discussed the importance of making progress in the investigation into Khashoggi’s killing during talks in Buenos Aires on Friday, the U.S. State Department said.

 

G20 leaders summit in Buenos Aires
Japanese Prime Minister Shinzo Abe and his spouse Akie Abe arrive ahead of the G20 leaders summit in Buenos Aires, Argentina November 29, 2018. REUTERS/Martin Acosta

 

British Prime Minister Theresa May told the prince that the killers of Khashoggi should be held to account, her office said after the two leaders met. Saudi Arabia said the prince had no prior knowledge of the murder.

French President Emmanuel Macron told the prince in a separate meeting that Europeans will insist on international experts being part of the investigation into Khashoggi’s killing.

 

G20 leaders summit in Buenos Aires
G20 leaders pose for a family photo during the G20 summit in Buenos Aires, Argentina November 30, 2018. REUTERS/Marcos Brindicci

 

Oil markets were awaiting a bilateral meeting between Putin and Prince Mohammed on Saturday afternoon for any sign that Russia will participate in a production cut by the OPEC oil cartel next month.

Putin was the only leader to exchange a warm greeting with the prince, high-fiving him when he entered the main summit room.

 

TRUMP AND TRADE

One bright spot before the summit opened was the signing of a revised U.S.-Mexico-Canada trade pact to replace the North American Free Trade Agreement.

 

G20 leaders summit in Buenos Aires
U.S. President Donald Trump and Argentina’s President Mauricio Macri meet before the G20 leaders summit in Buenos Aires, Argentina November 30, 2018. REUTERS/Kevin Lamarque

 

Signing the agreement alongside Canadian Prime Minister Justin Trudeau and Mexican President Enrique Pena Nieto, Trump said he looked forward to working with the U.S. Congress to complete the terms of the deal and did not anticipate problems.

The three countries agreed a deal in principle to govern their trillion dollars of mutual trade after a year and a half of contentious talks concluded just an hour before a deadline on Sept. 30.

 

G20 leaders summit in Buenos Aires
Canada’s Prime Minister Justin Trudeau gestures alongside his wife Sophie Gregoire Trudeau, Argentina’s President Mauricio Macri and his wife Juliana Awada at the Olivos Presidential Residence ahead of the G20 leaders summit in Buenos Aires, Argentina November 29, 2018. Picture taken November 29, 2018. Argentine Presidency/Handout via REUTERS ATTENTION EDITORS – THIS IMAGE WAS PROVIDED BY A THIRD PARTY.

 

Trudeau still had a few barbs on Friday. He called the deal by its old name NAFTA, prodded Trump over U.S. steel and aluminium tariffs and said General Motors Co‘s decision to cut production and its North American workforce, including in Canada, was a “heavy blow.”

 

(Reporting by Roberta Rampton, Michael Martina, Matt Spetalnick, Maximilian Heath, Scott Squires, Cassandra Garrison and Kylie Maclellan in Buenos Aires; Writing by Daniel Flynn; Editing by Ross Colvin, Frances Kerry and Rosalba O’Brien)

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