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G20 deeply divided on trade and climate change

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The G20 has staged a show of unity by signing up to a unanimous communique but only by papering over deep divisions on trade and climate change.

After two days of discussions in Osaka, Japan, leaders of the world’s biggest economies warned that trade and geopolitical tension had intensified and risks to the global economy “remain tilted to the downside”.

Their success in crafting a communique shows that the G20 is getting better at managing the disruptive challenge from US president Donald Trump, but at the price of weak agreements that do little to bind national leaders.

Officials involved in the talks said that trade, environment and the digital economy were the toughest issues with the debate on climate change going all the way to the deadline.

Shinzo Abe, chairing the G20 as prime minister of Japan, said that trade-related tension was a risk to the global economy. “There are concerns that the postwar free trade system may be wobbling,” he said. “Rather than playing up the differences between the G20, we strove to find common ground.”

On trade, the G20 did that by adopting a bland set of positive principles that were hard for anybody to disagree with: freedom, fairness, non-discrimination, open markets and a level playing field.

It did not repeat past promises to fight protectionism but there was agreement to take action on the dispute settlement system at the World Trade Organization, which is in danger of collapse because the US is refusing to appoint appellate judges. “Reform of the WTO is unavoidable,” said Mr Abe.

The biggest struggle was over climate change, with the G20 eventually meeting French president Emmanuel Macron’s demand for a strong reference to the Paris Agreement on reducing greenhouse gas emissions.

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As at the G20 summit in Buenos Aires last year, the communique said that participants in the Paris agreement regarded it as irreversible and were determined to implement it in full. But a separate paragraph noted that the US rejected the deal.

Mr Macron said leaders “held the line” on climate change and averted the threat of Donald Trump convincing Turkey and Brazil to join him in withdrawing from the Paris agreement. 

“The risk was having fewer states than the 19 [supporting the Paris agreement],” he said. “But we held together”.

The price was to include a strong statement of US objections and praise for its climate policy. “The United States reiterates its decision to withdraw from the Paris Agreement because it disadvantages American workers and taxpayers,” said the communique. “The United States is a world leader in reducing emissions.” 



Via Financial Times

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