U.S's President Donald Trump and European Commission's President Jean-Claude Juncker give statement on their meeting at the White House on July 25 - Photo by EC

JAKARTA (TheInsiderStories) – United States’s (U.S) President Donald Trump and European Commission (EC) President Jean-Claude Juncker has agreed to avoid trade war and to work toward zero tariff, barriers and subsidies, said the two leaders in a written statement on July 25.

At the meeting in White House, Trump and Juncker agreed will work together toward zero tariffs and other economic barriers on non-auto industrial goods. Trump promised won’t place a 25 percent tariff on European cars coming into his country.

The both leaders would also to stop any future tariffs while they continue to negotiate over Trump’s steel and aluminum tariffs placed last May. Furthermore, they agreed the European Union will import billions of dollars more in U.S soybeans and liquefied natural gas, which will also help Europe somewhat move away from its reliance on Russian energy.

U.S and EU, together count for more than 830 million citizens and more than 50 percent of the global GDP or more than 50 percent of global trade. As of today, the U.S and EU have a US$1 trillion bilateral trade relationship — the largest economic relationship anywhere in the world.

Previously, G20 finance ministers (FM) and central bank (CB) governors warned that increasing trade tensions risk undermining the global economy. The communiqué comes out over the weekend at the meeting in Buenos Aires, Argentina over the week end.

The ministers and governors said, amid growing tensions between the U.S and its major trading partners, finance ministers of the G20 end their summit without major controversy. But give a signal trade conflicts will be resolved anytime soon.

The ministers and CB governors meeting comes days after U.S President Donald Trump accused both Europe and China of manipulating their currencies to boost exports and threatened to impose up tariffs on hundreds million dollar goods.

The global policy makers emphasized the need “to step up dialogue and actions” between countries to minimize risks to global growth and improve confidence on trade. It also noted “downside risks” posed to the global economy as a result of “heightened trade and geopolitical tensions.”

Non-tax Revenues Bill Approved

From domestic side, yesterday Commission XI of Indonesian parliament has approved the draft of the State Non-tax Revenue Bill to be passed into Law. According to Finance Minister Sri Mulyani Indrawati the bill is an important strategy to keep the state revenues.

Previously, President Joko Widodo has issued Presidential Instruction No. 4 of 2018 on Increasing Supervision of Tax Receipts on Government Expenditures and Non-tax Revenues. Through the new regulation, Widodo instructed the supervision on the implementation of the treasury tax obligation in government expenditure and the management of non-tax revenues could be improved.

Meanwhile, political issues are also become investors attention, especially the annoucement of vice president’s name to accompany Widodo and Prabowo Subianto in the 2019 presidential election. The meeting of political elites continues on the eve of the registration of the names of presidential and vice presidential candidates to the General Elections Commission on August 4 to 10.

This various issues we believed will bring different sentiments in the financial markets. But in the other side, investors could get advantage from it.

Email: linda.silaen@theinsiderstories.com