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Japan pushing for multilateral efforts to address imbalances

  • June 2, 2019
  • , Jiji Press , 12:32 p.m.
  • English Press

Tokyo, June 2 (Jiji Press) — Japan is pushing for multilateral, not bilateral, efforts to address global current account imbalances, considered a major source of trade tensions between the United States and China, officials said.

The administration of U.S. President Donald Trump has been resorting to tariffs to pressure Beijing to make concessions in their trade fight.

Washington is also considering introducing restrictions on Japanese vehicle exports to the United States while calling on Tokyo to open the Japanese agricultural markets further.

To address imbalances, Japan is focusing on the current account, which covers investment in addition to goods and services trade, instead of the trade balance that includes only goods trade.

Imposing tariffs on goods from a certain country to improve the trade balance “isn’t a fundamental solution” as this leads to an increase in imports from other countries, a senior Japanese Finance Ministry official said.

Japan plans to push this current account focus approach when it chairs a two-day meeting of the Group of 20 finance ministers and central bank governors in the western city of Fukuoka, set to start Saturday.

In addition, Tokyo will pursue multilateral efforts to address imbalances instead of a bilateral mechanism favored by the Trump administration.

China’s excessive infrastructure-related loans that impose heavy debt burdens on developing countries are also expected to be high on the agenda of the G-20 meeting.

The finance chiefs of the G-20 countries, including China, are likely to agree on the importance of ensuring developing countries’ debt sustainability.

The G-20 officials are also expected to approve a roadmap for introducing fair taxation of Google and other technology giants by 2020.

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