US isolated as trade outrage roils G7 ministerial meet

Delphine Touitou and Douglas Gillison, Agence France-Presse

Posted at Jun 03 2018 08:00 AM

Delegates pose for an official photo at the G7 Finance Ministers Summit in Whistler, British Columbia, Canada, June 1, 2018. Ben Nelms, Reuters

WHISTLER, Canada - Washington's main allies delivered a unified message of shock and dismay at a Group of 7 ministerial meeting Saturday, urging US President Donald Trump to rescind punishing metal tariffs that took effect Friday.

US Treasury Secretary Steven Mnuchin was the odd man out as major trading partners rebuked Trump's multi-front trade offensive while their government's announced countermeasures and legal challenges that brought much of the global economy to the brink of open trade conflict.

Finance ministers at this snow-capped mountain resort north of Vancouver, British Columbia spoke of exasperation and an abiding sense of betrayal by a longtime ally.

Mnuchin, however, downplayed the disagreements and said the United States remained committed to the G7 process.

Canadian Finance Minister Bill Morneau announced the host government and 5 others had urged Mnuchin to express their "unanimous concern and disappointment" to the White House over new US tariffs.

French Finance Minister Bruno Le Maire also expressed France's outrage as the meetings ended.

"I want to make it clear," Le Maire said, "that it is up to the US administration to make the right decisions to alleviate the situation and ease the difficulties."

Avoiding trade war, he added, "will depend on the decision the (US) administration is ready to take in the next few days and in the next few hours -- I'm not talking about weeks ahead," Le Maire said.

The European Union and Canada are the largest sources of US steel and aluminum imports respectively.

German Finance Minister Olaf Scholz told reporters the US tariffs were "a very severe problem" for transatlantic relations.

"No one understands that due to security reasons there should be extra tariffs on steel and aluminum," he said.

Trump's tariffs on America's largest foreign providers of the crucial metals upended the agenda for this normally convivial event for consensus-building among countries that account for about half of global GDP.

No joint final statement emerged from the G7 ministerial meeting, a sign of the strong discord now at the heart of the global economy.

How such complaints would be received remained unclear, however. As the ministers' meet ended, Trump was as bellicose as ever, taking to Twitter to denounce "stupid trade" in which he said the US saw foreign tariffs on its exports without responding in kind.

"When you're almost 800 Billion Dollars a year down on Trade, you can't lose a Trade War! The U.S. has been ripped off by other countries for years on Trade, time to get smart!" he wrote.


Chairing a meeting on Friday, Morneau allowed participants to register grievances with Mnuchin one at a time, according to a Canadian source.

Behind closed doors, sources briefed on the talks said Mnuchin listened but spoke little, saying instead the discussion could continue at next week's G7 summit in the French-speaking province of Quebec at which Trump is expected to participate.

Mnuchin said he had informed Trump of his discussions but that trade was only one of many issues on a full agenda.

"These are our most important allies or some of our most important allies. We've had long-standing relationships with all these countries that are very important across all different aspects," Mnuchin told reporters.

"I believe there was a comment out there that this was the G6 plus one. It was not. This was the G7. We believe in the G7."

The week's whirlwind global developments in trade suggested de-escalation was unlikely.

On Friday, Trump mooted the possibility of scrapping the 24-year-old North American Free Trade Agreement in favor of seeking bilateral agreements with Canada and Mexico.

G7 governments were also digesting Trump's threats to impose tariffs on hundreds of billions of dollars in US auto imports on purported national security grounds.

In China, US Commerce Secretary Wilbur Ross was due to conduct trade talks with Chinese officials even as Washington finalizes planned sanctions on Beijing.

Potential measures include restrictions on Chinese investment in the United States, new export controls and 25 percent tariffs on about $50 billion in tech-sector goods.

The talks come despite the Trump administration's apparent announcement last month of a truce with Beijing following talks in Washington last month.

China has threatened to hit back with tit-for-tat tariffs on tens of billions of dollars in US goods -- as have Canadian, EU and Mexican authorities.

They have targeted goods manufactured in key US political districts that could weaken Trump's hand after November's mid-term elections.

The final list of Chinese imports affected by US tariffs will be announced June 15 and imposed shortly thereafter, while the proposed investment restrictions and enhanced export controls will be announced by June 30, according to the White House.

"China's door for negotiation remains open," foreign ministry spokeswoman Hua Chunying said Friday.

© Agence France-Presse