KONTAN.CO.ID - FUKUOKA. Financial leaders of the world’s top economies are likely steer clear of promises to avoid protectionism in their communique on Sunday, amid an escalating trade conflict between the United States and China, officials said on Saturday.

Finance ministers and central bank governors from the world’s 20 biggest economies, the G20, are meeting this weekend in the Japanese city of Fukuoka to discuss the global economy, with trade tensions between the world’s two biggest economies seen as a key risk to global growth.

“As for trade, the language will be reminiscent of previous communiques,” said one G20 official familiar with the draft of the joint statement.

On the insistence of the new administration of U.S. president Donald Trump, G20 financial leaders replaced in 2017 a standard phrase about avoiding all forms of protectionism with a sentence that they would work “to strengthen the contribution of trade to our economies.”

Asked if the new phrasing would be kept also this time, a second G20 official said: “Yes, most probably”.

Officials said the U.S.-China trade conflict was spilling over to other areas of discussions at the G20, making the drafting of the final statement increasingly difficult.

“If we go down this route, we risk clogging the G20,” the first official said.

China warned its companies operating in the United States on Tuesday they could face harassment from U.S. law enforcement agencies, and Beijing also rebuffed U.S. criticism of a Chinese trade white paper as “singing the same old tune”.

Relations between the world’s two largest economies have nosedived in recent months due to a tariffs battle, U.S. sanctions against Chinese telecoms giant Huawei Technologies Co Ltd and U.S. support for Chinese-claimed Taiwan.

The G20 pledge not to use competitive devaluations to gain advantage in international trade will remain in place, although the language on foreign exchange had not been finalised yet, officials said.

U.S. President Donald Trump and China’s President Xi Jinping are expected to meet on the sidelines of the G20 summit in Osaka later this month to seek a deal that would end the trade tensions, but officials have said hopes for a solution were low.

Editor: Wahyu T.Rahmawati