The International Monetary Fund has called for a speedy end to the deepening trade war between the United States and China after calculating that the tit-for-tat tariffs will cost $455bn (£357.5bn) in lost output next year – more than the size of South Africa’s economy.
Christine Lagarde, the IMF’s managing director, underlined her organisation’s growing concern at the most serious outbreak of trade tension since the 1930s and said “self-inflicted wounds” had to be avoided.
In a paper prepared for the meeting of G20 finance ministers and central bank governors in Japan this weekend, the IMF calculated that the recently announced intensification of protectionism would cut global gross domestic product by 0.3% in 2020.
The Washington-based IMF said that taken together with the tariffs announced last year the total impact would be a 0.5% hit to activity next year.
“This amounts to a loss of about $455bn, larger than the size of South Africa’s economy,” Lagarde said, noting that there was strong evidence that the US, China and the global economy were the losers from the conflict.
Via The Guardian
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