US-China breakthrough at G20 meeting is unlikely since tensions go beyond trade, analyst says
- ‘If the two sides agree to anything, it will be partial and short-lived because it’s not just about tariffs,’ said Anne Van Praagh of Moody’s
- The firm, which tracks geopolitical risks globally, also cut its estimate of China’s growth rate in 2019 to 6 per cent from 6.7 per cent this year
The US and China are not likely to walk away from the Group of 20 summit meeting in two weeks with a deal on tariffs as the tensions between them go well beyond trade, Moody’s Investors Service said on Thursday in New York.
US President Donald Trump and his Chinese counterpart, Xi Jinping, are expected to meet on the sidelines of the summit in Buenos Aires, Argentina, which begins on November 30.
Moody’s, a New York-based ratings analysis firm that tracks geopolitical risks globally, expects the strain between the world’s two largest economies to escalate. Specifically, Moody’s analysts said they saw the 10 per cent tariffs on US$200 billion of Chinese goods increasing to 25 per cent on January 1.
“We don’t expect much breakthrough at G20,” said Anne Van Praagh, managing direct of the global credit strategy and research unit at Moody's. “If the two sides agree to anything, it will be partial and short-lived because it’s not just about tariffs. It’s about geopolitical tensions around a rising China that is challenging to the US.”
So far, preparation for talks between officials from the two countries haven’t shown much progress. The discussions are designed for the two sides to come up with a framework that Trump and Xi can agree on at their G20 meeting.
