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IMF's Lagarde says global economic outlook darkening by the day

12.06.2018

International Monetary Fund (IMF) chief Christine Lagarde led an attack by global economic organisations on U.S. President Donald Trump's "America First" trade policy on Monday (June 11), warning that clouds over the global economy "are getting darker by the day".

Trump backed out of a joint communique agreed by Group of Seven leaders in Canada at the weekend that mentioned the need for "free, fair and mutually beneficial trade" and the importance of fighting protectionism.

The U.S. president, who has imposed import tariffs on metals, is furious about the United States' large trade deficit with key allies.

In response, Lagarde unleashed a thinly veiled attack on Trump's trade policy, saying challenges to the way trade is conducted were damaging business confidence, which had soured even since the weekend G7 summit.

The Washington-based IMF is sticking to its forecast for global growth of 3.9 percent both this year and next, she said, before adding: "But the clouds on the horizon that we have signalled about six months ago are getting darker by the day, and I was going to say by the weekend."

The IMF managing director spoke after a meeting in Berlin with German Chancellor Angela Merkel and the chiefs of the World Trade Organisation (WTO), the World Bank, the Organisation for Economic Cooperation and Development (OECD), the International Labour Organization and the African Development Bank.

Merkel said the EU would implement counter-measures against U.S. tariffs.

WTO Director-General Roberto Azevedo told the Berlin news conference: "We must ... stop this escalation of tensions. A tit-for-tat process is not going to be helpful."

He also criticised the United States' conduct at the WTO.

The European Commission, which coordinates trade policy for the 28-member EU, aims to target 2.8 billion euros worth of U.S. imports, including bourbon and jeans, with additional 25 percent duties from early July.

Source: https://uzreport.news