The world’s largest economic powers need to sort out the politics of the trade war between the United States and China because that’s the only thing holding global growth back, Scott Morrison believes.
The prime minister is heading to the G20 leaders’ meeting in Japan on Friday, where the trade fight is expected to be a major focus.
He said on Monday he was very concerned about the impact of the tensions on the global economy, as were other world leaders.
“The fundamentals more broadly are quite sound globally,” he told business leaders on Perth.
“The only barrier to that is actually political – and I don’t mean in a partisan sense, I mean by the actions of these key players at this stage not being able to resolve some pretty significant issues.”
Treasurer Josh Frydenberg has been at the G20 finance ministers’ meeting over the weekend and reported the conflict between the two giants, along with increasing protectionist sentiments around the world, was dragging heavily on confidence both internationally and domestically.
But it wasn’t Australia’s place to be drawn into the dispute, Mr Morrison said.
Chinese President Xi Jinping and US President Donald Trump will meet on the sidelines of the summit in Osaka to restart trade talks.
Mr Morrison said while everyone wanted them to resolve the dispute quickly and effectively, he was just going to wait and see what happened.
“There were the same hopes – and I held them – when we went into the Buenos Aires meeting last year which looked promising at first but ultimately didn’t get there,” he said.
“We will continue to press the urgency of the need for this to be resolved because it is impacting on confidence, it is impacting on investment.”