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Wednesday, June 26, 2019, 14:14
Draft communique of G20 summit 'backs free trade'
By Reuters
Wednesday, June 26, 2019, 14:14 By Reuters

A welcome sign is seen near a venue for the G20 Summit as a police officer stands guard in Osaka, western Japan, June 26, 2019. (JAE C. HONG / AP)

TOKYO — Leaders of the G20 top economies will call this week for the promotion of free trade to achieve strong global growth, Japanese media said on Wednesday, as the United States and China seek to resume talks to resolve their bitter trade dispute. 

The widening fallout from the US-China trade dispute has jolted markets and tested the resolve of members of the Group of 20, whose leaders are meeting in the western city of Osaka this week, to present a united front in averting a global recession. 

A draft of the joint communique shows G20 nations will highlight the promotion of free trade and technological innovation as two of the key drivers of the global economy, according to the Asahi newspaper

In preparing a joint communique, Japan, the chair of the meetings, seeks common ground between the United States, which opposes language denouncing protectionism, and other nations, which want a stronger warning against the risk of trade tension. 

A draft of the document shows G20 nations will highlight the promotion of free trade and technological innovation as two of the key drivers of the global economy, according to the Asahi newspaper. 

It also stresses the importance for nations of the grouping to create a positive cycle so that the benefits of solid growth are distributed broadly, the paper added. 

READ MORE: WTO chief hopes G20 summit will help ease trade tensions

The proposed language promoting free trade would respond to demands by some European countries for a warning in the summit communique against the spread of protectionist policies, according to the paper. 

Since an inaugural meeting in 2008 to tackle the global financial crisis, the grouping's leaders have included a phrase pledging to battle protectionism in annual communiques. 

Under pressure from the administration of US President Donald Trump, however, it dropped the phrase from the communique issued after last year's summit. 

Since then, the word "protectionism" has become taboo among G20 policymakers, as Trump's administration became sensitive to criticism over its tariffs imposed on China and other members of the grouping. 

A communique signed off by G20 finance leaders at a meeting this month also featured no denunciations of protectionism. 

ALSO READ: Japan's Aso urges G20 to renew pledge against protectionism

Markets are focusing on whether Trump and Chinese President Xi Jinping could pave the way to resolving the trade imbroglio in their meeting set for the margins of the summit. 

Last year's summit ushered in a five-month trade truce to allow for talks between the United States and China to end their intensifying trade war. 

Those talks hit an impasse last month, prompting both sides to impose higher tariffs on each other's goods as the dispute nears its first anniversary. 

US Treasury Secretary Steven Mnuchin has said the US and Chinese leaders' planned meeting has some parallels with their Buenos Aires summit last December that postponed a tariff hike.

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