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Jokowi doubtful US, China can patch up

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"This is the first time in 29 years of Apec that an Apec meeting produced no communique. Apec shows that the trade war between the US and China will likely persist." - Indonesian President Joko Widodo

Jakarta

INDONESIAN President Joko Widodo expressed pessimism on Tuesday that the United States and China will resolve their trade dispute when the leaders of the world's two biggest economies meet at the G-20 summit in Argentina at the end of this week.

"I'm hoping for a miracle during the G-20 meeting, that they will come together, but my feeling is they won't," he said.

Washington and Beijing, represented by Vice-President Mike Pence and President Xi Jinping, respectively, were hostile during meetings at the Asia-Pacific Economic Cooperation (Apec) gathering in Port Moresby last week, Mr Joko said.

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Indonesia had sought to mediate between the two during the Apec meeting, but by the afternoon, it was clear that the two giants could not agree, Mr Joko said.

"This is the first time in 29 years of Apec that an Apec meeting produced no communique," he told a forum in Jakarta attended by chief executives of Indonesian companies.

"Apec shows that the trade war between the US and China will likely persist."

US President Donald Trump said on Monday that he expected to move ahead with raising tariffs on US$200 billion in Chinese imports to 25 per cent from the current 10 per cent, and repeated his threat to slap tariffs on all remaining imports from China.

In an interview with The Wall Street Journal ahead of his high-stakes meeting with the Chinese President, Mr Trump said that it was "highly unlikely" that he would accept China's request to hold off on the increase, due to take effect on Jan 1.

Mr Trump, who is due to meet Mr Xi on the sidelines of the G-20 summit in Buenos Aires, said that if negotiations were unsuccessful, he would also put tariffs on the rest of America's Chinese imports.

At the Jakarta forum, Mr Joko urged Indonesian CEOs to face such global headwinds by looking for export opportunities.

Indonesia, South-east Asia's largest economy and a G-20 member, will likely not be one of the economies worst hit by the trade war due to its relatively small role in the global supply chain, according to analysts.

But its financial markets have suffered as investors cut their risk appetites this year, partly due to the brewing trade war. Earlier this year, the rupiah hit its weakest level since 1998, but has recently strengthened. REUTERS