Rising trade tensions can seriously hit global growth: EU

Brussels: European Union countries will tell the world's financial leaders next month that rising trade tensions can have a "serious adverse" effect on global growth and that they should reject protectionism and commit to solving disputes through the WTO.
Finance ministers and central bank governors of the world's 20 biggest economies are to meet Oct. 11-12 on the Indonesian island of Bali, and a trade war between the United States and China and tensions with Europe will top the agenda.
"We are concerned about the risk of escalating trade tensions, which can have a serious adverse impact for strong, inclusive, sustainable and balanced global growth and investment," EU finance ministers said in a document prepared for the meeting that is to be formally approved on Oct 2.
"The G20 should reconfirm its commitment to promote market openness, the fight against all forms of protectionism, including all unfair trade practices, an enhanced rule-based multilateralism and a level playing field for trade in goods and services, investment and intellectual property rights," the document, seen by Reuters, said.
The United States and China imposed fresh tariffs on each other's goods on Monday, showing no signs of backing down from an increasingly bitter trade dispute that is expected to hit global economic growth.
The US tariffs covered $200 billion worth of Chinese goods. China retaliated with tariffs on $60 billion worth of US products.
The United States has also imposed tariffs on steel and aluminium imports from the EU and threatened duties on European car imports. Those are on hold as long as EU and US trade representatives are in talks on a broader trade deal that would reduce the US trade deficit with Europe.
EU officials say they fully agree with the US that China uses unfair trading practices and steals intellectual property but disagree on how to bring Beijing into line.
The EU believes it would be better to address China concerns through the World Trade Organisation (WTO) rather than a trade war, but the administration of US President Donald Trump says the WTO is not up to the job.
European Union trade officials will travel to Beijing shortly before the G20 meeting for talks with their Chinese counterparts on reforms of the WTO.
The WTO has been under increasing pressure to reform since Trump blocked the reappointment of WTO judges and imposed its tariffs on China and other countries.
China is widely seen as the principal target of Trump's ire, so getting it to acquiesce to tougher WTO rules on subsidies, state-owned firms and preferential treatment could be key to achieving the "shape-up" of the WTO that Trump has demanded.
"Enhanced international cooperation is needed, and thus the EU calls on G20 members to support the modernization of the WTO, working together with other WTO members to fill the gaps in the multilateral rulebook, and the swift development of a new set of guidelines for publicly supported export finance by the International Working Group on Export Credits," the EU document said.