HONG KONG (Dispatches) - As the standoff between the U.S. and China keeps unfolding, Christine Lagarde warned that "darker clouds are looming” over the currently bright picture and outlined the main goals for the global economy.
Managing Director of the International Monetary Fund (IMF) Christine Lagarde lashed out at protectionism, which casts a shadow over the future of global trade, stating that "restrictions hurt everyone, especially poor customers.”
"Not only do they lead to more expensive products and more limited choices, but they also prevent trade from playing its essential role in boosting productivity and spreading new technologies,” Lagarde said during her speech at the University of Hong Kong.
According to her, "the current global picture is bright,” but there are "darker clouds looming.”
The "significantly increased” uncertainties include trade tensions, rising financial and fiscal risks, as well as more uncertain geopolitics. She warned that the world trade system of "rules and shared responsibility is now in danger of being torn apart.”
"This would be an inexcusable, collective policy failure,” emphasized Lagarde in her speech ahead of the annual spring meetings of country leaders and top bankers of the IMF’s 189 members, which is to take place in Washington next week.
U.S.-China tensions are expected to dominate the agenda of the summit according to the Guardian.
In March, the United States imposed new tariffs on steel and aluminum imports that targeted China, among other countries. Beijing retaliated in April by introducing duties on certain U.S. imports.
Last week, Washington announced yet another set of tariffs that would cover about $50 billion in Chinese goods, while U.S. President Donald Trump suggested introducing tariffs that would target $100 billion in Chinese goods imports. Shortly after the statements, Beijing announced similar duties on US imports of comparable value.
****International Monetary Fund chief Christine Lagarde warned against protectionist policies and talk of trade war in a speech to the Asia Global Institute at the University of Hong Kong.