First G7 Meeting Ahead in Post-Trump Global Economy: What’s On The Table?
Britain is set to host the G7 meeting this week, the first since US President Joe Biden took office last month. participating nations hope to see a renewed approach to global matters following Trump’s nationalistic approach over the last 4 years. The G7 is a meeting of representatives of the United States, Britain, Italy, France, Japan, Germany, and Canada. This week, the heads of their respective central banks, as well as the head of the European Central Bank, will be present.
What will be discussed?
As expected, one of the main topics on the agenda is the COVID-19 pandemic. The countries will discuss plans to approach stimulus programs to bring the global economy back on its feet. Another pressing matter that has been problematic for lawmakers over the past few years is how to tax digital firms. While most of these firms are American, they have a direct impact on all G7 countries due to their worldwide reach.
Fighting the pandemic
President Joe Biden has put forward a proposal for $1.9 trillion in tax and spending cuts. This is in addition to Trump’s $4 trillion plan that helped the country deal with the effects of the pandemic last year. In Britain, finance minister Rishi Sunak presents the budget next month and is likely to borrow more money. His government has already accrued the largest deficit in history, excluding times when Britain was at war. He is already under immense pressure at home, dealing with the effects of COVID-19 and Brexit at the same time.
World governments have been slow in dealing with the tax implications of large digital companies like Google, Amazon, Apple, and Facebook. At the moment, about 140 countries are working on the first draft for rules on taxation of cross-border commerce. It is quite possible that a deal on how best to tax these digital giants will be reached soon.
Helping vulnerable countries
While rich countries have been better able to help themselves in dealing with the effects of the pandemic, poorer nations aren’t so well equipped. . In that regard, an agenda for helping out developing countries on their path to economic recovery is also on the table. Central bank governors and finance ministers are expected to sign a statement at the summit.
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