Warnings and tensions at the G20 summit
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President of China Xi Jinping officially opened the two-day summit of leaders of the world’s largest economies, the Group 20. He said that he needed their agreement on measures to create a new momentum of economic growth and to avoiding protectionism. At the start of the G20 to be held in the eastern Chinese city, Si shook hands photographed with leaders, including President Barack Obama, German Chancellor Angela Merkel, and Russian President Vladimir Putin. In opening remarks, you said that the world economy is recovering, but the goal is to overcome multiple challenges in finance, trade, and investment. He said that at the summit to talk about the growth-based, innovation and the efficient management system in the world economy and finance. One of the main topics at the G20 summit in China are the results of a British referendum on leaving the EU, a move that some see as the first in a series of attempts of governments to withdraw from free trade. China, the host of the G20 summit, has placed emphasis on trade talks at a rally in the city southwest of Shanghai. Chinese officials have announced that they will propose a plan to strengthen trade through closer cooperation on the regulation of finance, taxation, and other issues. Beijing hopes to put the role of the host of the G20 will bring greater influence in the regulation of the global economy. Chinese officials want the G20, launched in order to better coordinate responses to the financial crisis of 2008, to take a long-term role in monitoring global economic management.
EU leaders at the opening of a summit of the Group of 20 (G20), called on China to take action in its steel industry and defend the decision of the European Commission (EC) to Apple’s door Ireland 13 billion euros of tax incentives, indicating a growing trade tension. European Commission President Jean-Claude Juncker called on G20 leaders, including the US, China, Germany and other developed economies, to urgently find a solution to the overproduction of steel. Junker urged Beijing to accept a mechanism for monitoring the overproduction of steel, one of the main reasons for low prices and job among Chinese trading partners. He also rejected US criticism of the decision of the EC to the American giant Apple Ireland must return $ 13 billion in tax relief. Free trade must be a fair trade. He rejected the accusation that the EU deliberately throwing the US company, stating that they are targeted because of their illegal tax exemptions found numerous European companies. Sharp comments are an indication of the political pressures that the government, at a time of weak global growth, protection of domestic industry.
Germany, South Korea, and other countries want to speak at the summit on climate change, energy and the possible reform of the global tax system to reduce evasion moves. On the eve of a two-day economic summit, the presidents of the US and China, Barak Obama, and Si Điping jointly signed the Paris agreement on climate. However, US officials want to bet on the agenda the question of China’s industrial excess and other difficult topics. Washington has imposed import duties, especially on Chinese steel, to compensate for unfair subsidies. China, the world’s largest steel producer, has pledged to cut steel production by 100 to 150 million tons by 2020.
May has said that Britain intends to use the opportunities in free trade as it prepares to exit the European Union. She emphasized that there will be attempts to avoid the implementation of decisions of the June referendum on leaving the EU. Obama and May were at a joint press conference indicated that they want to reduce the influence of the British exit from the EU to the relations between their two countries. However, the US president has hinted that London will have to wait before the US establish a new trade agreement with Great Britain, outside the EU. According to him, the US is focused on the completion of trade talks with the region Asia-Pacific and the EU. Obama said he believes that the current priority for Britain to discover what Brexit means for Europe.
In a joint statement the presidents of the US and China, the leaders of Britain, Japan, Russia and other members of the G20 pledged to boost ailing global growth by improving innovation and strengthening the global financial system. Seeking to bolster public support for trade, they have promised to increase the benefits of greater global integration felt by millions of people. Tons of cheap steel poses a threat to jobs in the US and Europe and results in a restriction of trade.
In a joint statement calls on the G20 to establish a forum for steel under the auspices of the Organization for Economic Cooperation and Development to examine the question of heavy capacity. The root of the problem in China’s national steel industry that provides half of the world production. However, this reduction accounts for only half of China replete capacity estimated at 300 million tons and more reductions are needed in order to bring production into line with demand. The market is distorted by subsidies and other support measures, and this is a fundamental problem. The presidents of China, the United States and other leaders throughout the summit called for the government to defend free trade. Benefits of trade and open markets must be transferred to the wider public as efficiently as the G20 joint statement.
G20, despite the positive tone of the statement, is unlikely to do much to stimulate trade and economic growth. It is alleged that the negotiations on free trade agreements slowed to Britain deals with the impact of the decision to leave the EU and that some economies, including Russia and Nigeria, in a recession.