International Monetary Fund chief Christine Lagarde expressed concern on Tuesday over fresh trade tensions between the United States and China. “Clearly, the tensions between the United States and China are a threat for the world economy,” AFP quoted Lagarde as saying at a conference in Paris.
US President Donald Trump announced on Sunday that the United States would increase tariffs on $200 billion of Chinese goods to 25% from their current level of 10% this week as trade talks were going “too slowly”.
French Economy Minister Bruno Le Maire, who was also present at the Paris Forum event, warned about the impact of a trade war between China and the US. “We are following the current negotiations very closely between China and the United States and we want them to respect the principles of transparency and multilateralism,” Le Maire said, according to AFP.
Lagarde’s concerns were also shared by billionaire investor Warren Buffett who had said on Monday that a trade war would be “bad for the whole world”. “If we actually have a trade war it will be bad for the whole world, and could be very bad depending on the extent of war,” he had said.
China and the US have imposed tariffs on $360 billion in two-way trade since last year. However, Trump and his Chinese counterpart Xi Jinping came to an agreement in December last 2018 to stop further escalation. Trump had accused Beijing of indulging in unfair trade practices.