Key facts
- 19 G20 members agreed to address global economic imbalances caused by cheap exports.
- China dissented from the G20 consensus on export trade distortions.
- U.S. Treasury Secretary Scott Bessent criticized China's export policies.
- The G20 chair's statement urged countries to avoid unnecessary export restrictions.
- Global bond markets experienced a selloff, with Japan's 10-year yield reaching 3%.
G20 finance leaders, with the exception of China, have agreed to take action against "non-market" policies that create an over-reliance on exports and hinder global economic growth. U.S. Treasury Secretary Scott Bessent stated that 19 countries supported addressing the issue of non-market-based economies pushing a continuous stream of cheap exports, which he described as unsustainable. The G20 chair's statement urged nations to eliminate such policies that exacerbate imbalances and to avoid unnecessary export restrictions.
China's significant export push has put pressure on economies worldwide, with its total exports rising 23.9% year-on-year in July. Despite calls to reduce industrial subsidies, China has shown little interest in rebalancing its economy, and its goods trade surplus with the European Union reached 360.6 billion euros last year. European officials, including European Economy Commissioner Valdis Dombrovskis, identified China as a major source of economic imbalances. German Finance Minister Lars Klingbeil also pointed to U.S. tariff disputes and the Iran war as sources of global economic uncertainty.
Meanwhile, global bond markets experienced a selloff, with Japan's 10-year bond yield reaching 3%. Treasury officials indicated that Bessent had also urged sound monetary policy to anchor inflation expectations and avoid currency volatility in discussions with Bank of Japan Governor Kazuo Ueda, remarks seen as supporting a potential rate hike by the BOJ.