Broad agreement at G-20. Continue to support economies through the pandemic and economic recovery.
NIKKEIAsia February 27, 2021 18:25 JST “G-20 Agrees not to ease fiscal stimulus to keep up recoveries” “US raises hopes of global tax rule for Google, Amazon and Facebook
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Summary of the article
G-20* made up of the world's richest countries met virtually to discuss and coordinate on shared economic and pandemic challenges. “The world’s financial leaders [including Biden for the first time] agreed on Friday to maintain expansionary policies to help economies survive the effects of COVID-19 and committed to a more multilateral approach to the twin coronavirus and economic crises.” According to the G20 Italia 2021 Italian President, Daniele Franco, “We agreed that any premature withdrawal of fiscal and monetary should be avoided." The European Union has already spent $3.63 trn and America is likely to add another $1.9 trn on its ongoing effort. It was noted that the near-future economic recovery is less predictable due to uncertainties about the global coronavirus vaccine rollout and the potential impact by emerging COVID-19 variants.
Biden, for his part, “pledged to rebuild U.S. cooperation in international bodies.” There was much enthusiasm additionally as “the thorny issue of taxation of multinational companies” the likes of Google, Amazon and Facebook appeared to gain some conceptual consensus. “Janet Yellen told the G-20 Washington had dropped the Trump administration’s proposal to let some companies opt out of new global digital tax rules…and that plans are being made to “reform U.S. minimum tax regulations in line with an OECD proposal for a global effective tax.”
In discussing the world’s poorest countries, “hit hard by the crisis…there was broad support for boosting the capital of the International Monetary Fund to help it provide more loans, but no concrete numbers were proposed.” There’s a sense that the U.S. economy will return to “precrisis levels” by year’s end with Europe lagging “until the middle of 2022.” Also noted China’s and Japan’s growth has slowed recently.
*G-20 includes; Mexico, China, Argentina, Russia, Germany, Australia, Brazil, India, Saudi Arabia, Indonesia, France, Canada, South Africa, Turkey, Japan, Italy, South Korea, United Kingdom, United States and the European Union