By Swaha Pattanaik
WASHINGTON- One of their number even earned the nickname “Super Mario.” But the world’s financial heroes aren’t invincible.
Finance ministers and central bankers who attended last week’s International Monetary Fund annual meeting have found their kryptonite: It’s gravel in the gears of world trade.
This friction is one of the main reasons why the multilateral lender’s new boss, Kristalina Georgieva, expects the weakest world GDP growth in a decade this year, at 3 percent, with 90 percent of the global economy expanding more slowly than last year.
There were glimmers of hope during the meetings in Washington, like signs of a temporary truce in the US-China trade row and fresh potential for Britain to avoid a chaotic European Union exit.
But Bank of England Governor Mark Carney on Friday articulated what’s jangling nerves.
He told a packed hall that for the first time in 16 years of attending the meetings he was seeing an “almost existential uncertainty” about the structure of the trading system.
Fixing this problem is beyond the prowess of finance ministers and even once-mighty central bankers.
That’s less because commerce is technically outside their remit.
Rather, US President Donald Trump’s readiness to slap tariffs on allies, for example in Europe, as well as on pricklier counterparts such as China, has turned trade into a political hot potato best left to heads of government. – Reuters