G20 divided over US stance on excess capacity

By the Editorial Team · Sunday, October 4, 2026

G20 trade ministers failed to agree on U.S. proposals aimed at curbing excess industrial capacity and non-market economic practices, with only a few countries backing the U.S.-led initiatives. The deadlock highlights continuing trade tensions, as the U.S. plans further tariffs and investigations while only limited support emerged for efforts to remove forced labor goods from supply chains.

Trade ministers from the Group of 20 (G20) failed to reach full agreement on U.S. proposals targeting excess industrial capacity and non-market economic practices, highlighting persistent divisions among the world’s largest economies. The U.S. Trade Representative’s Office (USTR) released a statement on Friday following a two-day meeting in Milwaukee, noting that only a small number of members endorsed efforts led by the United States to address these issues.

According to the USTR, a “handful” of G20 countries opposed the U.S.-backed language that sought to establish a cooperative framework aimed at reducing excess industrial capacity. While the statement did not specify which members dissented, it reaffirmed disappointment from the U.S. presidency of the group. Previously, China openly opposed similar measures during a G20 finance leaders’ meeting in North Carolina last month. Beijing has consistently denied allegations that its industrial subsidies and policies contribute to excess capacity, accusing Western nations of using the issue as a pretext for protectionist practices.

In a related development, only Mexico and Argentina joined the United States in endorsing a separate statement calling for enhanced collaboration to eliminate goods produced with forced labor from global supply chains. This limited support came amid increasing trade tensions, underscored by tariff actions enacted by the Trump administration. Since March, the U.S. has imposed duties ranging from 10 to 12.5 percent on imports from 59 countries and the European Union, citing inadequate enforcement of forced labor bans. Moreover, the USTR is conducting a second "Section 301" investigation targeting 16 trading partners over concerns related to excess industrial capacity, with new tariffs expected in the near future.

Despite disagreements on these trade disputes, the ministers achieved consensus on condemning the use of food exports as tools of economic or political coercion, agreeing that such practices should not be weaponized. This consensus underscores ongoing complexities within the G20, where collaboration on global trade issues remains challenged by competing national interests and geopolitical tensions.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.