The G20 has dropped a decade-long pledge to uphold and promote the principle of global free trade in the face of mounting opposition from the US.
Representatives of the world's biggest economies recently concluded a meeting of G20 financial leaders in Germany, with a closing statement that omitted the usual pledge to maintain opposition to all forms of tariffs and international trade rules that favor one economy over another.
The issue was mentioned in only a cursory reference to strengthening trade, a change of approach that can be attributed to the increasingly protectionist approach adopted by the US since the inauguration of Donald Trump as president.
Germany is reported to have actively fought the US's attempt to water down the G20 commitment to free trade, meaning this outcome represents a political setback. Other leading members of the G20, including China and Japan, were also said to be unhappy with the statement.
This is indicative of the Trump administration's new America First trade policy, which is motivated by a sentiment that free trade has led to US manufacturing job losses. This philosophy has already seen the US exit the Trans-Pacific Partnership and commence steps to renegotiate the North American Free Trade Agreement with Mexico and Canada.
A number of the attending leaders expressed disappointment with the outcome of the meeting, with Michel Sapin, the French finance minister, saying that a firmer commitment to free trade is "absolutely essential in today's world".
Meanwhile, EU economic affairs commissioner Pierre Moscovici described the summit as "not the best meeting we've had", while expressing hope that progress can be made on this front during the G20's July meeting in Hamburg.
However, US treasury secretary Steven Mnuchin said: "We believe in free trade - we are in one of the largest markets in the world, we are one of the largest trading partners in the world. Trade has been good for us; it has been good for other people. Having said that, we want to re-examine certain agreements."
