WASHINGTON (Reuters) – President Joe Biden will hold his first event with other leaders from the Group of Seven nations in a virtual meeting on Friday to discuss the coronavirus pandemic, the world economy and dealing with China, the White House said on Sunday.
The meeting is the first by top leaders from the G7 group of rich democracies since April, it said.
“This virtual engagement with leaders of the world’s leading democratic market economies will provide an opportunity for President Biden to discuss plans to defeat the COVID-19 pandemic, and rebuild the global economy,” the White House said in a statement.
The White House said Biden would focus his remarks on a global response to COVID-19 vaccine production and distribution as well as “continued efforts to mobilize and cooperate against the threat of emerging infectious diseases by building country capacity and establishing health security financing.”
Biden, a Democrat who took over from Republican former President Donald Trump on Jan. 20, has sought to project a message of re-engagement with the world and with global institutions after four years of his predecessor’s “America First” mantra.
Trump withdrew the United States from the World Health Organization and the Paris climate accord and largely scoffed at multilateral organizations and groups.
Biden brought the United States back into the WHO and rejoined the Paris accord and has signaled a desire to work with allies in confronting China on a host of thorny issues.
“President Biden will also discuss the need to make investments to strengthen our collective competitiveness and the importance of updating global rules to tackle economic challenges such as those posed by China,” the White House said.
Trump challenged China over its trade policies by imposing punishing tariffs, an instrument he also used on traditional allies, drawing criticism for not taking a more unified approach with U.S. friends to stand up to Beijing on issues such as intellectual property theft and other economic practices.
Domestically, Biden is pressing Congress to pass a $1.9 trillion stimulus package to boost the U.S. economy and provide relief for those suffering from the pandemic.
The White House said he would discuss his economic agenda with G7 counterparts and encourage them and all industrialized countries to maintain “economic support for the recovery” and other collective measures.
Climate change would also be on the agenda.
U.S. Treasury Secretary Janet Yellen spoke to her G7 counterparts last week and called for continued fiscal support to secure the economic recovery.
Reporting by Jeff Mason; Editing by Daniel Wallis and Peter Cooney
UK's Sunak says vaccine passport idea might help the economy – TheChronicleHerald.ca
LONDON (Reuters) – British finance minister Rishi Sunak said the idea of giving people vaccine passports or certificates to allow them to enter venues or events might be a way to help the country and its economy recover from the coronavirus pandemic.
“Obviously it is a complicated but potentially very relevant question for helping us reopen those parts of our country like mass events,” Sunak told BBC television on Sunday.
Prime Minister Boris Johnson said last week that the government would hold a review to consider the scientific, moral, philosophical and ethical questions about using vaccine certificates for people who have received a coronavirus shot, which could help entertainment and hospitality venues reopen.
(Reporting by William Schomberg and David Milliken; Editing by David Clarke)
CBI calls for 'lasting budget boost' to protect UK economy – Yahoo Movies Canada
The Confederation of British Industry (CBI) has outlined three areas for chancellor Rishi Sunak to focus on in next week’s Budget to help businesses out of lockdown.
It comes after prime minister Boris Johnson announced a step-by-step roadmap out of lockdown, which could see England return to “normal” by 21 June.
The CBI has called on Sunak to focus on jobs, confidence and investment to give firms the “boost they need to bring the UK back to growth.”
CBI, which represents 190,000 businesses of all sizes and sectors across the UK, is urging the chancellor to hone in on “policies that will catalyse business investment” in key areas like jobs, skills and innovation.
It said that business is also looking to Sunak to incentivise green investment to set them on track to net zero.
The group warned that firms that are still in “emergency mode” are “sounding alarm bells” that any significant tax rises in the short-term will “stifle their ability to invest, hamper UK competitiveness and hold back our recovery.”
Rain Newton-Smith, CBI Chief Economist, said that “this Budget is like no other, with many businesses still on their knees” after the impact of the coronavirus pandemic.
“The prime minister’s roadmap for easing restrictions and the chancellor’s forthcoming Budget represents two parts of the same story — bookending the immediate COVID-19 crisis by relieving firms under pressure and setting the economy on a path to recovery,” he added.
The three key areas that the CBI has identified are:
Protecting jobs, firms and livelihoods in the immediate term by extending furlough, providing further VAT deferrals and giving firms (including in vital supply chains) a further business rates holiday.
Get businesses investing, by using incentives to spur investment in skills, jobs and innovation. This includes vouchers to get SMEs investing in digital technologies; unlocking investment in training by reforming the Apprenticeship Levy; and setting up the new National Infrastructure Bank to crowd-in investment.
Provide the vision for a long-term plan for economic growth. From green investment incentives to laying the groundwork for a fundamental reform of the unfair and uncompetitive business rates system, businesses want a signal of intent about the future of the economy.
Newton-Smith continued: “But this can’t just be about the here and now. We need to match the urgent need to protect jobs and firms with giving everyone a glimpse of an ambitious vision for the future of the economy. That means giving firms the confidence they need to invest by committing to the kind of pro-business environment that would help them to compete with the world’s best.
“Consumption and government spending alone can’t set us on the path to recovery. We need a dynamic and competitive business community powering us forward. That means avoiding any moves in the short-term that would hold business back from doing what it does best: innovating, creating jobs and delivering greater prosperity for all.”
CBI’s calls follow a slew of plans the Treasury announced ahead of the chancellor’s second Budget on 3 March to help get the country back on track post-Brexit and the coronavirus pandemic.
“Now we’ve left the EU and taken back control of our borders, we want to make sure our immigration system helps businesses attract the best talent from around the world,” Sunak said.
On Friday evening, it announced a £126m investment to bolster traineeships and create 40,000 new posts to help people back into the jobs market.
The Treasury also unveiled a mortgage scheme to help first-time buyers with low deposits buy a home. Under the plans, buyers will pay just 5% deposits to buy homes worth up to £600,000 and will offer lenders the guarantee to provide mortgages covering the remaining 95%.
Additionally, it has also revealed plans to create a task force to crack down on fraudsters exploiting the UK government COVID-19 support schemes. Sunak will unveil at the Budget on Wednesday a £100m investment to launch the task force.
WATCH: What UK government COVID-19 support is available?
Bond Rout Shows Risk of Uneven Recovery in World's Top Economies – BNN
(Bloomberg) — The U.S. economy appears primed to recover from the Covid-19 slump much faster than others, causing havoc on bond markets this week and potentially exacerbating the kind of imbalances that caused trouble after the last crisis.The prospect that the U.S. recovery could decouple from developed-world peers and the implication of that for global currencies and trade is likely to figure high on the agenda when finance ministers and central bankers from the Group of 20 major economies meet online later today.“A multi-speed rebound in the global economy continues with a strong U.S., a moderating China and a choppy euro-area,” said Catherine Mann, chief economist at Citigroup Inc. “For 2021 at least, the U.S. as global locomotive is back on track.”
The speed differences are the result of economic policy choices as well as variance in the severity of virus outbreaks, rules for containing them and rollout of vaccination programs. If the gaps persist for too long, it could stir up tensions over trade and currencies like the ones that followed the financial crisis — as well as deepening inequality between countries.The U.S., where President Joe Biden is pushing another $1.9 trillion in pandemic relief measures through Congress, appears most committed to running its economy hot. U.S. officials are calling on others to keep their foot on the gas too.“I urge G-20 countries to continue to take significant fiscal and financial policy actions and avoid withdrawing support too early,” Treasury Secretary Janet Yellen wrote to fellow attendees before today’s meeting. “Together, our efforts will be greater than the sum of our individual responses.”
The U.S. will expand 6.2% this year, recouping all its 2020 losses and then some, JPMorgan economists forecast. By contrast, the euro area, Japan and the U.K. aren’t expected to reach their pre-Covid GDP until 2022.While all major economies boosted government spending to shore up growth in 2020, hardly any except the U.S. will be running expansionary fiscal policy this year, according to JPMorgan’s calculations.
In the near term, everyone gets a lift out of rapid growth in the U.S. –- because it’s the world’s biggest importer.For countries that have weaker economies or are less willing to stimulate them, “it basically means more external demand,” said Alicia Garcia Herrero, chief Asia-Pacific economist at Natixis SA in Hong Kong.She sees no problem for the rest of the world if the U.S. embarks on a big stimulus, provided it doesn’t trigger the kind of inflation that would lead investors in dollar assets rushing for the exit. “That is the big if,” she says.In the longer run, the perception that other economies were taking advantage of the U.S. role as consumer of last resort can fuel trade conflicts, like it did with China under President Donald Trump. Even before that, in the early 2010s, U.S. officials would complain that Europe was running too-tight policy and not contributing enough to global growth.The same kind of tensions could await in a post-Covid world if policy support is withdrawn “in an uncoordinated or haphazard manner,” wrote Neil Shearing, chief economist at Capital Economics, in a Chatham House paper published last week.“Countries that under-stimulate their economies must rely on demand from the rest of the world,” he wrote. “There are already ominous signs that the recovery has become unbalanced,” like growing current-account surpluses in China, Vietnam and Taiwan, and deficits in the U.S.
Currencies may be another cause of contention. The dollar has been declining steadily after a spike early in the pandemic, causing anxiety among countries that don’t want their exports to become less competitive. Yellen has said the U.S. will let markets determine the greenback’s value.“The U.S. is likely to push back against other countries’ intervention in foreign exchange markets to weaken their currencies, despite other major advanced economies being in worse economic straits,” said Eswar Prasad, a professor at Cornell University.Australia’s central bank has argued the local dollar would be stronger if it weren’t for its latest stimulus measures. In Japan, Prime Minister Yoshihide Suga said he’s watching foreign exchange rates more closely than any other financial or economic indicator.
China’s yuan has gained about 10% against the dollar since June, spurring the government to consider relaxing restrictions on taking money out of the country in order to take the pressure off. Bloomberg Economics’ yuan stress indicators suggest the currency’s strength is set to continue in the near term.As well as addressing the uneven recovery in their own economies, G-20 leaders are also under pressure to prevent the gap with the world’s poorest nations from widening further. Those countries haven’t been able to ramp up government spending to fight the virus like their wealthier peers did, and they struggle to obtain vaccines.The G-20 has been working on a debt forgiveness plan that would involve private creditors. Yellen praised the effort in her letter, though she said implementation would be the real test. She also signaled support for boosting the International Monetary Fund’s lending power.“Without further international action to support low-income countries, we risk a dangerous and permanent divergence in the global economy,” Yellen said.
©2021 Bloomberg L.P.
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