
G20 communique delivers rare show of unity amid Trump trade war
"The global economy is facing heightened uncertainty and complex challenges, including ongoing wars and conflicts, geopolitical and trade tension,' the communique said. "We emphasize the importance of strengthening multilateral cooperation to address existing and emerging risks to the global economy.'
The agreement, forged during the G20 summit in South Africa's eastern KwaZulu-Natal province, was reached despite simmering tensions over U.S. President Donald Trump's trade war, which is set to intensify when higher tariffs take effect on Aug. 1.
They have strained the G20's multilateral foundations and complicated South Africa's efforts — as this year's rotating president — to keep the group's agenda on course.
"The fact that all members consented to language covering debt relief, climate finance, tax cooperation, and financial stability during such a period demonstrates the success of the approach that we have adopted,' said South African Finance Minister Enoch Godongwana.
It was the first G20 communique this year.
Tariffs were not explicitly mentioned in the five-page document. But Godongwana played that down, noting it was a relatively recent issue "and in any case I feel that our discussion on the broad number issues affecting global growth have included the range of risk to economic growth, without singling out tariffs.'
The G20 communique did note the importance of the World Trade Organization to advance trade issues, while adding that it recognized "the WTO has challenges and needs meaningful, necessary, and comprehensive reform to improve all its functions.'
Officials also sided with Federal Reserve Chair Jerome Powell, who Trump has excoriated for opposing him by not lowering interest rates, out of concern the levies could spur inflation.
"Central banks are strongly committed to ensuring price stability, consistent with their respective mandates, and will continue to adjust their policies in a data-dependent manner,' the communique said. "Central bank independence is crucial to achieving this goal.'
South African Reserve Bank Gov. Lesetja Kganyago told reporters at a closing news conference that the issue of independence "came out strongly in the conversation.'
Powell did not attend this G20, with the Fed being represented by Vice Chair Philip Jefferson.
The communique also included a prominent reference to "frequent extreme weather events and natural disasters which impact economic growth, financial and price stability.' Climate-change language has been a sticking point with the Trump administration in the past.
U.S. Treasury Secretary Scott Bessent skipped the event in favor of a trip to Japan, but Washington still sent a delegation to represent its interests.
By imposing trade levies, scorning South Africa's G20 motto of "solidarity, equality and sustainability' and pulling billions of dollars in funding for climate finance and international aid, the U.S. is testing a world order that has dominated since the end of World War II.
That makes achieving a communique all the more impressive, said German Finance Minister Lars Klingbeil prior to its adoption.
"This is a major achievement for the G20 presidency, which has conducted these negotiations with prudence and skill,' he told reporters at the gathering, at a lush resort on the Indian Ocean near the port city of Durban. Issuing the communique sends "a strong signal in favor of multilateralism,' he said.
Still, tariff uncertainty has dented global economic growth. The International Monetary Fund in April cut its projection for 2025 to 2.8% from a January forecast of 3.3% and IMF First Deputy Managing Director Gita Gopinath, who attended the G20, said that while financial conditions have improved, vigilance was important.
"While we will update our global forecast at the end of July, downside risks continue to dominate the outlook and uncertainty remains high,' she said in a statement as the gathering concluded.
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles


Yomiuri Shimbun
36 minutes ago
- Yomiuri Shimbun
Trump Agreed to Tariff Deal With Japan After 70-Minute Talks; U.S. President Tried to Trade Concessions for 1% Reductions
There was just about one week remaining until the Aug. 1 deadline when Japan and the United States reached a 15% tariff deal. Tokyo had managed to avoid the worst-case scenario of U.S. President Donald Trump's administration levying duties of 25% from next month. Japan succeeded in lowering not only what Trump calls 'reciprocal tariffs,' imposed on dozens of countries including Japan, but also the automobile tariff that was a top priority for this nation. Patience Economic revitalization minister Ryosei Akazawa faced off against Trump at the White House on Tuesday. The talks had been arranged just the previous day and represented the first such meeting since April. U.S. Treasury Secretary Scott Bessent and U.S. Secretary of State Marco Rubio were also present. According to sources involved in the negotiations, the U.S. side made detailed demands — asking Japan, for example, to provide a certain item in return for lowering tariffs by 1%, and to increase rice imports and boost investment and support for semiconductors. Trump was said to have pushed for a deal in which he would lower tariffs by 1% in exchange for each concession. 'Mr. Trump made demands, citing specific figures. It felt like we needed at least 10 people to handle it,' one source said. In response, Akazawa patiently persuaded Trump, using various bargaining chips. After about 70 minutes of talks, Trump finally agreed, stood up and asked Akazawa for a handshake. 'Automobiles are Japan's bedrock' In the negotiations that began in April, Akazawa prioritized the revision of a proposed automobile tariff. In their first face-off at the Oval Office, Trump threatened Akazawa, saying steel was the bedrock of America, and Akazawa riposted with 'Automobiles are the bedrock of Japan.' As negotiations progressed, the Japanese side concluded that it was impossible to get the United States to withdraw its demands and shifted its goal to a reduction. The United States and the United Kingdom reached an agreement on May 8 in which the U.S. levy on British vehicles was dropped to 10% in exchange for British carmakers being limited to exporting 100,000 cars a year to the United States. Japan has a bitter history of voluntarily restricting its automobile exports to the United States in response to trade friction in the 1970s. Focusing on avoiding a limit on the quantity of its auto exports, Japan gradually lowered its goal, believing that 'if the United Kingdom was hit with 10%, it will be hard for Japan to get a 10% tariff,' according to a Japanese government official. The negotiations made significant progress in mid-May, according to Japanese government officials. The Japanese side presented investment plans in nine areas, including automobiles, iron and important minerals and also proposed the integration of supply chains. U.S. Commerce Secretary Howard Lutnick and others praised the proposals, and an agreement was reached between the ministers at the end of May. Before the Japan-U.S. summit in June, Prime Minister Shigeru Ishiba told those around him that 'negotiations are 90% complete.' However, Trump was not satisfied with the plans and increased pressure on Japan, saying Japan was 'very tough' and 'so spoiled.' He hinted at raising tariffs to 30%-35%. Mission accomplished Nevertheless, Japan did not change its proposals. Instead, it changed the way it prepared documents and explained them in order to gain Trump's understanding. Lutnick, meanwhile, explained the proposals to Trump nearly 10 times, and the green light was given for an agreement in the middle of July. The day before Tuesday's meeting, Lutnick invited Akazawa to his home to rehearse the meeting. After the meeting with Trump, Akazawa posted on X 'Mission accomplished.' A senior government official recalled: 'Only Trump has the authority to make the final decision on the numbers. Some countries have had their decisions overturned at the last minute. We could not let our guard down at all.'


NHK
2 hours ago
- NHK
Nikkei 225 reaches new high for the year for 2nd day
Tokyo's benchmark stock index has reached a new high for the year for the second day in a row. Shares continued to climb following the Japan-US deal on hopes for more agreements between Washington and other trading partners. The Nikkei 225 closed Thursday at 41,826, up 1.6 percent. Investors picked up a wide range of shares soon after the opening. The index briefly hit the 42,000 mark for the first time since last July when it set its all-time high. The benchmark jumped 3.5 percent on Wednesday after Japan and the United States struck a trade deal. Analysts say there are growing expectations among investors for an agreement between the US and the European Union. Meanwhile, the broader TOPIX closed at its all-time high of 2,977.


Nikkei Asia
3 hours ago
- Nikkei Asia
A good day for AI, a rough one for Elon Musk
Hi from Yifan, your #techasia host this week, sending this newsletter from the unusually busy Silicon Valley. Summer is normally a quieter time as people go on vacation and enjoy some breeze. But not this year. More U.S. trade deals are being announced and Big Tech earnings season kicked off this week. But what excites Silicon Valley the most is probably the government's long-awaited AI action plan unveiled on Wednesday. The 28 pages of guidelines detail how U.S. President Donald Trump's administration plans to govern AI. It's a long document, so if you want to save some time, here's the gist: no regulation, no "wokeness," more exports. Silicon Valley had feared U.S. regulators might throw up roadblocks in front of the fast-moving technology revolution, as the European Union did with the EU AI Act. But they can breathe a sigh of relief now. Trump assured the companies that the federal government will not get in their way as long as they can beat China in the AI race -- he even said he would block state-level regulations on AI. Trump also said he will further relax some export rules so that other countries will buy more tech products from the U.S. and build their AI future on American hardware and software. The action plan doesn't address copyright infringement, misinformation, deepfakes and many other key issues with AI, but judging by the share prices of Nvidia and other AI-related companies on Wednesday, it at least makes investors happy. Speaking of happy, one thing Trump is not entirely pleased with when it comes to artificial intelligence is its name. "I don't like the name artificial anything, because it's not artificial. It's genius. It's pure genius," Trump said of AI on Wednesday, suggesting the technology be renamed. But what the president dislikes even more is "woke" AI. Trump said his administration will make sure the American people do not have "woke Marxist lunacy" in their AI, starting by signing an executive order that directs the federal government not to use AI to generate output that embraces DEI, or diversity, equity and inclusion. AI with American characteristics While much of Trump's U.S. AI action plan is focused on competing with China, the day may still come when Washington and Beijing are far more aligned on AI governance. During a keynote speech on Wednesday, Trump said the U.S. has to "be able to play by the same set of rules" with China if it wants to win the AI race, Nikkei Asia's Yifan Yu reports. Trump specifically said he wants the AI industry to be more patriotic, similar to what Beijing has demanded from its own tech sector. "Perhaps most importantly, winning the AI race will demand a new spirit of patriotism and national loyalty in Silicon Valley," Trump said. "We need U.S. technology companies to be all in for America. We want you to put America first. You have to do it, that's all we ask." The AI action plan repeatedly mentions that AI models should reflect "American values." China has language in its generative AI regulations emphasizing that content produced through the use of generative AI must reflect "Socialist Core Values" -- the governing credo of the Chinese Communist Party. Value adding Top multinationals like McDonald's and UK insurer Bupa are joining giants such as Goldman Sachs and Tesco to set up back offices in India to drive their in-house innovation in artificial intelligence, writes the Financial Times' Krishn Kaushik and Chris Kay in Bengaluru. As many non-tech companies struggle to compete for hires in the red-hot market for AI in their home countries, India offers an opportunity to recruit tech talent at scale. Groups are doing so by setting up so-called global capability centers that can perform a wide range of big data-related tasks. Analysts predict these centers, which employ nearly 2 million people today, can reach $100 billion in revenue by 2030, up from $65 billion revenue last year. For India, this presents a step up the value chain, as these back offices move from providing support services to performing core competitive functions that directly affect companies' profitability. In search of stability South Korea's new government under President Lee Jae Myung is eager to issue won-backed stablecoins -- digital tokens pegged to traditional currencies -- hoping to nurture the country's digital asset market and give it a prominent place globally, Nikkei Asia's Kim Jaewon and Stella Yifan Xie write. Seoul's move comes amid a broader battle surrounding the crypto technology's geopolitical influence, following an aggressive push for dollar-pegged coins by the U.S. Earlier this month, the U.S. House of Representatives passed the GENIUS Act, which sets up a federal framework to regulate dollar-pegged stablecoins. The bill is being sent to Trump, who is expected to sign it into law. Such developments have in turn brightened investor sentiment toward digital assets, lifting the price of bitcoin, one of the most-traded cryptocurrencies, above $123,000, an all-time high. A rough patch of road Attending an AI summit in Washington D.C. on Wednesday, Trump gave shout-outs to Nvidia CEO Jensen Huang and other tech leaders present at the event. But one noticeable absence was Tesla CEO Elon Musk. That could be because Musk was busy answering questions at Tesla earning's call on Wednesday afternoon, during which he warned investors that there might be more "rough quarters" ahead as the U.S. EV giant tries to transform into an AI and robotics company, starting with the recent launch of robotaxis, Nikkei Asia's Yifan Yu reports. It could also be because of the falling out between Musk and Trump. The once-hailed "first buddy" tech billionaire has left his post as a special advisor in the White House and engaged in several virtual shouting matches with the president since. At the same time, Huang appears to have become Trump's new favorite tech rock star. The Nvidia CEO is also becoming a more prolific figure in geopolitics, as Beijing looks for a business leader who could replace Musk as a bridge to Trump, Nikkei Asia's Ken Moriyasu and Yifan Yu write. Can China ever match ASML's lithography mastery? Welcome to the Tech Latest podcast. Hosted by our tech coverage veterans, Katey Creel and Shotaro Tani, every Tuesday we deliver the hottest trends and news from the sector. In this episode, Shotaro speaks with Taipei tech correspondent Annie Cheng Ting-Fang about how China's chip ambitions are being tested by the challenge of matching ASML's lithography capabilities. Find us on Apple Podcasts | Spotify | Amazon Music | Voicy | YouTube | YouTube Music Suggested reads 1. Japan bets big on ultrathin, ultralight solar panels (Nikkei Asia) 2. Microsoft accuses Chinese hackers of exploiting SharePoint software (FT) 3. LG bets on AI as government pushes for 'sovereign' models (Nikkei Asia) 4. Xi Jinping warns Chinese officials against over-investment in AI and EVs (FT) 5. SK Hynix's Q2 profit hits record on strong AI chip demand (Nikkei Asia) 6. Amazon to shut down Shanghai AI research lab (Nikkei Asia) 7. 'No longer a pet project': tiny Beijing stock exchange becomes IPO hub (FT) 8. Asia's 'peak polarization' is yet to come, says Taiwan's Audrey Tang (Nikkei Asia) 9. AI demand powers Taiwan's TSMC to its highest-ever quarterly profit (FT) 10. The Magnificent 7 growth slowdown (FT)