Trade tensions simmer as Morneau, finance ministers hold G20 meetings

Finance minister Bill Morneau is set to meet this weekend with G20 counterparts in Argentina amid escalating tensions over trade and tariffs.

The finance ministers of G20 countries gathered in Buenos Aires for talks on Saturday and Sunday that are set to see the Trump administration‘s protectionist policies and implementation of tariffs on billions of dollars worth of goods in recent months be a major source of frustration.

READ MORE: G20 protests: Why the international summit attracts so much anger

Earlier in the day, the head of the International Monetary Fund issued a sharp warning about the impact Donald Trump‘s tariffs – both implemented and threatened – could have on global economic growth.

“It certainly indicates the impact that it could have on GDP (gross domestic product), which in the worst case scenario under current measures … is in the range of 0.5 per cent of GDP on a global basis,” Lagarde said at a joint news conference with Argentine treasury minister Nicolas Dujovne.

WATCH: IMF warns G20 leaders that tariffs will harm global economy

1:14 IMF warns G20 leaders that tariffs will harm global economy

Her remarks come one day after Trump said he is willing to slap tariffs on all $500 billion worth of Chinese imports.

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READ MORE: Donald Trump says he’s willing to slap tariffs on every single Chinese product the U.S. imports

Currently, he has ordered tariffs put in place on roughly $34 billion worth of Chinese products.

As well, steep tariffs on steel and aluminum imports from Canada, the European Union and Mexico have resulted in a wave of retaliatory tariffs in response.

The question now is whether the trade war he has cultivated will escalate to include new tariffs on auto imports.

WATCH BELOW: Trump threatens almost all imports from China as Beijing fires back

1:01 Trump threatens almost all imports from China as Beijing fires back

Finance ministers from the G20 last met in March and could not come to any agreement on how to address the problem.

Now it appears there is little optimism that the meeting taking place this weekend will end any differently.

“Unfortunately, it does not look like we will take big steps forward in Buenos Aires,” German finance minister Olaf Scholz told Reuters.

With files from Reuters.