U.S. Treasury's Mnuchin says U.S. reserves right to be protectionist

Jay Anderson
May 20, 2017

US Treasury Secretary Steven Mnuchin rejects the idea that under President Donald Trump the United States is reviving protectionism, yet asserting that the US would still do that if "trade is not free and fair".

G7 finance chiefs vowed Saturday to unite against cyber crime as they wrapped up talks marked by signs of a thaw in the frosty relations between the USA administration and its main partners.

Coming after a global cyber attack infected tens of thousands of computers in almost 100 countries on Friday.

The G7 said banks should strengthen their resilience to attacks through regular exercises and simulations, known as "penetration tests", and it called on a cyber security task force it set up in 2015 to accelerate its work.

The statement said fiscal policy should be used to help job creation while keeping public debt on a sustainable path and monetary policy should help economic activity without fuelling strong inflation.

At the moment it seems not to have created any problems for the financial system.

Italian Finance Minister Pier Carlo Padoan said Saturday's session on cybercrime was "unfortunately very timely", an apparent reference to the wave of ransomware attacks in which files were locked and payment demanded to unlock them. "This is a reminder to all of us the importance of cybersecurity".

The talks, scheduled before Friday's events, focused particularly on the potential threat to the global financial system in the event of hackers being able to infiltrate the computer systems that run the global banking system, capital and equity markets.

G7 finance ministers prior to the Bari summit.

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Aso told Mnuchin that it is necessary to recognize the situation is a crisis.

Of course there are differences and divergences ... but we are working well together on common areas of concern and joint measures.

Mnuchin's presence was overshadowed by a political firestorm in Washington after Trump fired Federal Bureau of Investigation chief James Comey, whose agency was investigating links between the president's 2016 election campaign and the Russian government.

Mnuchin said his meetings with finance leaders had led to better understanding of the USA president's position that trade must be fair and balanced as well as open.

Mnuchin meets with Padoan May 11. "On the trade side, our objective is to grow exports, to give more opportunities to American workers to make things and sell them". Under the administration of Donald Trump, the U.S. are feeling disadvantaged in global trade, not least due to other major currencies being undervalued compared to the dollar and unfavourable trade deals that the United States had signed up to in the past 25 years. The US government seems to be favouring a bilateral, rather than multilateral, approach to global affairs, which falls in line with Trump's idea of global trade as "reciprocal".

"We don›t want to be protectionist but we reserve the right to be".

They also say the United States demand to balance trade bilaterally was not economically sound, because trade deficits and surpluses could only be analysed in a global context.

The communique said: "We will strive to reduce excessive global imbalances and in a way that supports global growth".

The issue of protectionism is expected to feature in discussions in Sicily, which take place in the town of Taormina.

Other reports by BadHub

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