US ‘back at the table’ to help global economic recovery

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Janet Yellen/Photo: AP

US President Joe Biden’s administration told allies on Friday it was re-engaging with them to help steer the global economy out of its worst slump since the Great Depression, a contrast with the go-it-alone approach of Donald Trump.

US Treasury Secretary Janet Yellen told her peers from the Group of Seven rich democracies that Washington was committed to multilateralism and “places a high priority on deepening our international engagement and strengthening our alliances.”

Yellen spoke to the G7 in a virtual video meeting, chaired by Britain, at which she called for continued fiscal support to secure the recovery, saying “the time to go big is now.”

Britain said officials discussed giving help to workers and businesses hit by the pandemic while ensuring sustainability of public finances “in the long term.”

As well as the United States and Britain, the G7 includes Japan, France, Germany, Italy and Canada.

Italian Economy Minister Roberto Gualtieri said the group had committed to continuing coordinated action to support the economy. “The withdrawal of policy support is premature,” he wrote on Twitter.

Biden has proposed a further $1.9 trillion in spending and tax cuts on top of more than $4 trillion of coronavirus relief measures enacted by his predecessor Trump.

British finance minister Rishi Sunak is expected to say next month that he will extend his economic rescue programmes and that reining in public finances will have to be addressed later.

Britain said G7 officials also agreed that making progress on reaching “an international solution to the tax challenges of the digital economy” was a key priority.

Countries have been trying to revive attempts at a global approach to taxing giant digital firms – many of them American, such as Amazon and Alphabet’s Google – after progress was blocked by Trump’s administration.

Britain called on G7 countries to agree a joint approach to taxing internet giants by mid-2021, a deadline agreed by the wider Group of 20 nations.❐

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