Italy at G7 warns about risks of trade tensions, dollar weakening

Italy is concerned about trade tensions triggered by the threat of U.S. tariffs, and about the devaluation of the dollar, its economy minister told his international partners on Friday at a meeting of G7 finance chiefs in Durban, South Africa.

"We are concerned about the impact of economic uncertainty and persistent trade tensions on our economies," Minister Giancarlo Giorgetti said in a statement issued by his staff on the sidelines of the gathering.

In an escalation of a trade war that has angered U.S. allies and rattled investors, President Donald Trump this month announced a 30% tariff on imports from Mexico and the European Union starting on August 1, after weeks of negotiations with the major U.S. trading partners failed to reach a comprehensive trade deal.

Italy in April estimated a negative impact of 0.3% on its economic output this year, under the assumption of a 20% U.S. tariff on European Union countries.

"The weakening of the U.S. dollar exchange rate is adding to the effect of increased trade tariffs," Giorgetti said in his comments in Durban on Friday.

The minister also said that firms that have helped Russia fund its war on Ukraine by doing business with Moscow should be excluded from Ukraine's reconstruction, reiterating a position he has already expressed.