U.S. officials used the G20 finance meeting in Asheville, North Carolina, to press fellow members to prioritize economic growth over debt worries, as the Iran war disrupts energy supplies and global debt sits near record highs. Treasury Secretary Scott Bessent dismissed talk of bond market turmoil and pushed G20 members toward isolating Iran and rebalancing trade with China.
U.S. officials urged Group of 20 finance leaders on Monday to push harder for economic growth as the best way to counter concerns over rising global debt. The two-day meeting in Asheville, North Carolina, opened as an energy shock from the Iran war rattles the global economy, alongside tension over China's trade surplus and questions over how an AI investment surge will play out.
Debt near record levels, but no "turmoil"
Global debt levels hit a record of nearly $353 trillion earlier this year, prompting some investors to reappraise even traditionally safe havens such as U.S. Treasuries. Yet Bessent pushed back on the narrative before the talks even began.
According to Reuters: "I'm not sure where the bond market turmoil is", he told Reuters in an interview on Sunday, adding that U.S. growth remains a key strength even as the country runs large budget deficits. Bessent said the U.S. had benefited from AI infrastructure investment, which has also helped push up Treasury yields by absorbing savings that once flowed into government debt.
Growth as the way out
Bessent framed growth as the only real remedy for the debt overhang built up since the 2007-2009 financial crisis and the pandemic. He told G20 finance leaders that global growth had underperformed its potential for too long, and that the causes could no longer include policy failures of the country's own making.
Federal Reserve Chairman Kevin Warsh, attending his first international economic policy meeting since taking office in May, described the moment as one of a global investment surge that has reversed a prior period of idle capital.
Iran, China and Canada on the agenda
A top U.S. objective for the meeting is to persuade other G20 members — including through the threat of secondary sanctions — to isolate Iran and end the standoff over the Strait of Hormuz that has disrupted global energy supplies. Washington is also pressing members to re-examine trade terms with China to shrink global imbalances.
Bessent said China's trade surplus stands at $1.2 trillion and argued Beijing is trying to export its way out of a weak domestic economy. He also confirmed he would meet his Canadian counterpart at the meeting, after Canada announced counter-tariffs set to take effect in coming days once trade talks to avert new U.S. levies collapsed last week.
Source: Reuters (via Yahoo Finance)
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