It's in everyone's interest to avoid protectionism: Obama

Just a week ahead of the G20 summit in Pittsburgh, US President Barack Obama has said it is in everyone's interests to avoid protectionism, especially at a time when the world trade is starting to bounce back.

Obama also said he would urge global powers to do more to "aggressively reform" the financial system.

Obama's comments on protectionism came ironically after the US slapped duties on imports of tyres from China over the weekend.

“I think it's in China's interests and our interests and the world's interests to avoid protectionism, particularly just as world trade is starting to bounce back from the huge declines that we had seen last year,” he said in course of an interview with CNBC television.

On Friday, Obama had approved the duties on the imports after a labour union blamed these for the loss of thousands of American jobs. Two days later, China, in response, filed a WTO complaint, challenging the higher US tariffs as a violation of free-trade rules. And there was apprehension in certain quarters that there could be over a trade war between the two.

Obama, confident that he can avoid a trade war, said, "when, as happened this weekend, we invoke provisions of existing agreements, we do so not to be provocative or to promote self-defeating protectionism, we do so because enforcing trade agreements is part and parcel of maintaining an open and free trading system."

Obama said he believed in trade agreements that can make America more prosperous and its trading partners more prosperous.

“I have always said that, and I continue to believe it. I have also believed that if we don't enforce the rules that are contained in our trade agreements, then it's very hard to have credibility and it's hard to get the American people to support future trade agreements,” he said.

Obama said he was not surprised that China is upset about it. “But keep in mind, we have a huge economic relationship with China.  We have cultivated a strong strategic relationship with China,” he said.