Compass World: G20 Buenos Aires Summit 101
Leaders of the world’s 20 largest economies met in Buenos Aires, Argentina, on November 30 and December 1 for the 2018 Group of Twenty (G20) summit. The meeting comes at a turbulent time for the global economy, with tit-for-tat retaliatory tariff exchanges between China and the United States and the renegotiation of the North American Free Trade Agreement (NAFTA).
Beyond economic concerns, the G20 meeting was also politically fraught do to tension between the U.S. and its European allies, acrimony stoked by the murder of journalist Jamal Khashoggi, and recent brinkmanship by Russian President Vladimir Putin in the Black Sea. Read below for in-depth coverage from Compass World of important new developments out of the 2018 G20 summit.
Pouring Gas on the Fire
Outside the 12-square-kilometer (4.6-square-mile) cordon surrounding the G20 meeting in Buenos Aires, hundreds of thousands protested against the presence of President Donald Trump, Saudi Crown Prince Mohammed bin Salman, and Argentine President Mauricio Macri, as well as against globalization.
The Argentine government closed public transit services during the summit, and protesters were kept about five kilometers (3.1 miles) away from the event. Many of the protesters represented anti-capitalist and socialist organizations, drawing on the long legacy of Peronism in Argentina. "We will march up to the security fence so the functionaries ... can see there's resistance from the people," said Sebastian Dominguez, a member of the Argentine Regional Workers' Federation, an anarchist organization.
Robert Kennedy of the Motorcade Resistors, an anti-Trump group, flew a giant balloon depicting a caricature of the president as a diaper-wearing infant clutching at a cellphone to Buenos Aires on November 29 to join the protests. The balloon was also flown in London during Trump’s visit to the country in July. The balloon was crowdfunded and has its own Twitter account.
Argentine Security Minister Patricia Bullrich told the press on November 30 that police had discovered six rudimentary bombs in an area of the city that was hosting large anti-G20 demonstrations. The bombs, which were filled with gasoline and modeled off Molotov cocktails, were safely removed by Argentine officials. It remains unclear who placed the explosive devices and who was their intended target.
99 Problems, And a Trade Deal Is One
A widely anticipated dinner between Trump and Xi yielded a surprising detente between China and the United States amid an acrimonious trade war. Trump agreed to a 90-day pause on new tariffs planned to impact more than $200 billion of Chinese imports to the United States.
In March, the White House announced 25 percent import duties on steel and aluminum from most countries, including China, Canada, and European Union states, among others. The move sent American steel and aluminum stocks up, but caused turmoil for manufacturers using foreign steel and aluminum as inputs in globally integrated supply chains. In response, Beijing imposed $3 billion worth of targeted tariffs on American products from stainless steel piping to wine and pork.
The trade dispute escalated further when the U.S. Trade Representative’s Office recommended a 25 percent levy on Chinese goods worth about $50 billion. Just a day later, however, China responded with equally large tariffs on soybeans, chemicals, and car components. The tit-for-tat tariffs spiralled into a costly trade war. As of December 2018, the U.S. has imposed $250 billion in tariffs on Chinese imports, and China has responded with $110 billion of its own countervailing duties.
After a steak dinner with Xi in Buenos Aires on the sidelines of the G20 summit, Trump said that he would put on hold previously announced plans that would have raised tariffs on $200 billion worth of goods from 10 to 25 percent. This abatement will allow American and Chinese trade negotiators to continue debate aimed at solving key differences over agriculture, intellectual property, and trade-distorting subsidies. In return for the breathing space, Xi agreed that China would purchase “a not yet agreed upon but very substantial, amount of agricultural, energy, industrial, and other product from the United States,” according to the White House.
Because of its large (and widening) trade deficit with China, experts say the U.S. has the upper hand in the current trade dispute. China will run out of new American imports on which to impose retaliatory tariffs long before the U.S. runs out of new Chinese imports to target. Economists say this may give Trump leverage in negotiations with China, where the economy is also more dependent on foreign trade: international trade was 38 percent of GDP in China in 2017; in the U.S., it was just 26 percent. This imbalance makes China comparatively vulnerable to the instability that has come with American trade policies under Trump, so it is expected that Xi wants to normalize trade relations as soon as possible and return to business as usual.
“Murder Incorporated.”
Putin and bin Salman, who is commonly known by the acronym MBS, made international headlines for an enthusiastic greeting caught on tape at the G20 meeting. MBS has made headlines for other reasons in recent months: in mid-November, American intelligence officials confirmed that MBS had likely directly ordered the brutal torture, killing, and dismemberment of Saudi journalist Jamal Khashoggi inside the Saudi consulate in Istanbul on October 2.
Khashoggi was a non-citizen permanent resident of the United States and an opinion columnist for the Washington Post, where he expressed views critical of the Saudi government’s handling of human rights and press freedoms, among other issues. His murder sparked international condemnation and increased scrutiny of the West’s relations with Saudi Arabia.
MBS is not the only one to be culpable for violence against the press. It is widely believed that Putin’s government was responsible for the murder of prominent Russian journalist and human rights activist Anna Politkovskaya in 2006. Politkovskaya was gunned down in the elevator of her apartment block after years of critical reporting on the brutal conflict in Chechnya. She received many awards for this journalism, including the 2001 Amnesty International Global Award for Human Rights Journalism. She is not the only journalist to die in Putin’s Russia: the Committee to Protect Journalists reports that 83 Russian journalists were killed from 1993 to 2018.
Garry Kasparov, who was born in the Soviet Union, is the chairman of the Human Rights Foundation.
While aboard Air Force One en route to Buenos Aires on November 29, Trump decided to cancel a meeting he had previously planned with Putin, which the Kremlin blamed on “domestic politics” in the United States. The two did have a brief conversation about Russian military action in the Black Sea, but Putin said no progress was made.
What’s In a Name?
In a ceremony at the G20 meeting including Canadian Prime Minister Justin Trudeau and Mexican President Enrique Peña Nieto on November 30, Trump officially signed the United States-Mexico-Canada Agreement (USMCA), which, if ratified, will replace NAFTA and set the new terms of trade for North America. In early 2017, the Trump administration announced its intention to renegotiate the terms of NAFTA, which it viewed as disadvantaging American exporters and shipping jobs to low-wage Mexico.
The first trilateral talks took place on August 16, 2017, and officials set a timeline for negotiating the agreement, which was signed and ratified during the Clinton administration in the 1990s. It was not until August 2018 that a draft deal was reached between Mexico and the U.S., and it initially appeared that Canada would sit out the new agreement after a series of bitter and often personal barbs were exchanged by Trump and Trudeau.
The provisions of the USMCA are not much different from the terms of NAFTA. However, there are several small differences: new enforcement mechanisms for labor standards; a more open Canadian dairy, egg, and poultry market; and higher domestic content requirements and wage thresholds for automotive production.
To speed Congressional ratification of the USMCA, Trump told reporters aboard Air Force One returning from the G20 that he would act to cancel NAFTA. The move is intended to force Congress to assent to the new deal when it reconvenes in January with a new Democratic majority in the House. Implementation of the USMCA will restore some stability to the global economy after the G20 meeting, but the agreement does not end American tariffs on imports of steel and aluminum from many countries, Canada and Mexico included. Canadian opposition politicians are thrashing Trudeau in the press for his failure to secure the cancellation of the tariffs.
The G20 summit in Buenos Aires belied cracks in the international economic order amid rancorous conflict that has pitted longtime allies in North America and Europe against one another, cleaved once-cordial economic relations between America and China, and exposed unsavory friendships between the West and human rights abusers. As these stories continue to develop, turn to Compass World for timely and balanced coverage.