China vice premier says protectionism poses 'serious hazard' to global economy

Chinese Vice Premier Hu Chunhua talks with Vietnamese Prime Minister Nguyen Xuan Phuc during their meeting at the government office in Hanoi, Vietnam September 11, 2018. Nhac Nguyen/Pool via Reuters

HANOI (Reuters) - Chinese Vice Premier Hu Chunhua on Wednesday called for a rejection of protectionism and said unilateral trade policies by some countries posed a "most serious hazard" to the world economy.

His comments come at a time of a worsening trade dispute between China and the United States, which has been pursuing measures widely regarded as protectionist under President Donald Trump.

Leaders of Southeast Asian nations also voiced their support for multilateral pacts at a World Economic Forum event in Hanoi. Even so, Singapore flagged there was no guarantee a broad agreement on the world's biggest trade pact that the countries have been working on with China would be signed by year-end.

"Some countries' protectionist and unilateral measures are gravely undermining the rules-based multilateral trading regime, posing a most serious hazard to the world economy," Hu said in Hanoi at the World Economic Forum on the Association of Southeast Asian Nations (ASEAN).

"We must categorically reject protectionism and unilateralism, firmly support multilateralism, and uphold the world economy and multilateral trading regime," he said.

Last week, Trump said he was ready to levy additional taxes on practically all Chinese imports, threatening duties on $267 billion of goods over and above planned tariffs on $200 billion of Chinese products. China on Monday said it will respond if the United States takes any new steps on trade.

He has criticised China's record trade surplus with the United States, and has demanded that Beijing cut it immediately.

If the United States imposes additional tariffs of 25 percent on $200 billion of Chinese goods, unemployment in China could increase by 3 million assuming Beijing does not take any counter measures, JP Morgan analysts wrote in a note.

If Washington moves ahead with 25 percent tariffs on all Chinese imports, about 6 million jobs in China could be affected, assuming no counter steps by China and no change in the value of the Chinese yuan, according to JP Morgan.

Meanwhile, Singapore Prime Minister Lee Hsien Loong said he was not sure if there would be an agreement this year on the Regional Comprehensive Economic Partnership (RCEP) trade pact, which includes the 10 ASEAN countries plus China, Australia, India, Japan, South Korea and New Zealand.

"(We) hope to achieve a substantial conclusion to the RCEP by the end of this year, but that is not yet assured," Lee said in Hanoi.

Singapore's trade minister earlier this month said nations were aiming to reach broad agreement on the pact at a leaders summit in the city-state in November, six years after talks began.

The Beijing-backed RCEP was given new impetus by the United States' withdrawal from the Trans-Pacific Partnership (TPP) trade agreement, to which China is not party.

(Reporting by John Geddie, Khanh Vu, James Pearson, Mai Nguyen; Additional reporting by Ryan Woo in BEIJING; Writing by A. Ananthalakshmi; Editing by Christopher Cushing)