Chinese President Xi Jinping called on member states to reject protectionism ‘outright’.
Brazil, Russia, India, China and South Africa want a rules-based multilateral trade system as embodied by the World Trade Organization to be central to global commerce as the BRICS block’s biggest member faces billions of dollars of additional tariffs from the U.S.
“We recognize that the multilateral trading system is facing unprecedented challenges,” the BRICS nations said Thursday in a declaration drawn up at their 10th annual summit held in Johannesburg. “We call on all WTO members to abide by WTO rules and honor their commitments.”
Escalating trade tensions are threatening to derail a global upswing that’s already losing momentum amid weaker-than-expected economic growth in Europe and Japan as financial markets seem complacent to the mounting risks, the International Monetary Fund warned July 16.
The U.S. and China clashed at a WTO meeting Thursday, with Washington demanding reforms to make the Asian nation’s economy more responsive to market forces. The office of the U.S. Trade Representative is preparing levies on an additional $200 billion of Chinese goods and President Donald Trump said he is “ready to go” with tariffs on as much as $500 billion, roughly the value of all China’s annual exports to the U.S. The two countries last month launched their initial salvos by imposing duties on $34 billion of each other’s imports.
Trump said this month that the WTO treats the U.S. unfairly, responding to questions about reports he’s considered withdrawing the U.S. from the organization. The American government wins most of the cases it initiates with the body.
Earlier at the summit, Chinese President Xi Jinping called on BRICS nations to reject protectionism “outright” and promote trade and investment liberalization. There are no winners in a trade war, he said.
“We must work together at the UN, Group of 20 and World Trade Organization to safeguard a rule-based multilateral trading regime,” Xi said, adding disputes should be resolved through dialog.
Strengthening trade and investment ties with BRICS nations “is one of the priorities,” Russian President Vladimir Putin said at the same event.
The BRICS countries agreed to strengthen their cooperation in energy, and want nations to fully implement the Paris Agreement on climate change.
The countries also reaffirmed a need for “comprehensive reform” of the United Nations and its Security Council to make it more representative and for more developing countries to be present, they said. –Bloomberg