Aso, Mnuchin agree to avoid competitive currency devaluations


An early draft communique circulating among the G20 members meeting in German resort town of Baden-Baden did not include any references to trade or protectionism.

Treasury Secretary Steven Mnuchin and Federal Reserve Chair Janet Yellen represented the two days of meetings with their counterparts from the world's 20 largest economies in Baden-Baden, Germany.

The annual G20 meeting of the 20 financial leaders closed without a set agreement on free trade after the U.S. rejected past commitments regarding the open flow of goods.

They see that formulation as a way to hem in the economic nationalism advocated by President Donald Trump's "America First" platform.

Germany has been found itself in the crosshairs of United States criticism over its massive trade surplus.

"Our objective is getting more balanced trade agreements", he said, confirming that having border taxes is an option.

The United States has already said it would keep a close eye on the levels of key global currencies, but pursue policies in the interest of "economic growth that is good for the USA and the rest of the world".

Seeking to put "America first", Trump has already pulled out of a key trade agreement and proposed a new tax on imports, arguing that certain trade relationships need to be reworked to make them fairer for USA workers.

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The failure by ministers to agree on trade and climate action was met with dismay by France, whose Finance Minister Michel Sapin said: "I regret that our discussions today were unable to reach a satisfying conclusion".

But he said he would press fellow finance ministers from China, Japan, Germany and other G20 countries to abide by existing currency vows and to not to use their exchange rates for competitive gain and others' disadvantage.

The AP reports that Wolfgang Schaeuble, Germany's finance minister, suggested there had been tension during the two-day meeting. "Free trade has led to a lot of bad things happening".

Trump's anti-globalisation agenda wins against the bloc's decade-old tradition of rejecting protectionism. "But it is not very clear what (protectionism) means to each (minister)". Those could include targeted job training and education.

Chinese President Xi Jinping and Merkel also took the unusual step of stressing their commitment to free trade ahead of the G20 meeting.

The focus will be on the final statement issued jointly by the finance ministers on Saturday.

The Group of 20 is comprised of 19 countries plus the European Union.

The U.S. Treasury Department said Mnuchin and Aso underscored the need to "work closely and constructively" to foster strong global economic growth. Before the group meeting, the two talked for about 35 minutes in the first face-to-face between finance ministers of Japan and the USA since the inception of the new administration in Washington.