Washington — Financial leaders of the G20 major economies on Wednesday approved a global arrangement to revise corporate taxes and promised to maintain financial support for their economies while paying attention to inflation.
The G20 Finance Minister and Central Bank Governor also in a communiqué issued after a meeting in Washington, the International Monetary Fund is a new trust to direct the issuance of the $ 650 billion IMF currency reserve to a wider range of vulnerable countries. He said a fund should be set up.
In a statement, financial leaders said the economic recovery “remains highly diverse domestically and internationally” and is vulnerable to new variants of COVID-19 and the uneven pace of vaccination. ..
“We maintain financial stability and long-term fiscal sustainability, protect against downside risks and negative spillover, while prematurely withdrawing support measures,” the G20 financial leader said in a statement. And continue to maintain recovery. “
Given the rising inflationary pressures caused by supply chain bottlenecks and shortages as the economy struggles to normalize, the central bank “is closely monitoring current price movements,” he said.
“They will act as necessary to meet their obligations, including price stability, consider temporary inflationary pressures, and remain committed to clear communication of their policy stance,” the G20 communiqué said.
Bank of Italy Governor Inhazio Bisco said in a press conference that G20 financial leaders will be in many developed countries as temporary factors such as supply bottlenecks, shortages of semiconductors, delays in shipments and weather problems diminish. I think the inflation rate is rising.
“But again, these can take months to disappear, so you need to be well prepared and communicated about how to perceive the problem, and this is the central banking community. That’s why we’re discussing it at the ECB, “says Visco.
G20 financial leaders are also committed to addressing the lack of tools to combat the COVID-19 pandemic in low- and middle-income countries in the coming months, including vaccines, treatments and diagnostics. bottom.
The G20’s financial leaders meet in Washington next to the IMF and the World Bank’s annual meeting. The meeting will take place a few days after 136 countries have agreed to adopt a minimum corporate tax of 15% and redistribute the tax rights of large, profitable multinationals to some countries. .. Sell products and services.
G20 leaders approved the OECD tax treaties, guided the implementation of national agreements, and called for the rapid development of so-called “model rules” that “guarantee that new rules will be implemented at the global level in 2023.” ..
New IMF Reserve Vehicle
The G20 also has a new “resilience and sustainability confidence” that will allow some of the $ 650 billion special drawing rights reserves allocated to IMF member countries to be directed to support low-income countries. We have agreed to support the IMF proposals we make. Middle-income countries, and other small developing countries.
“The new RST needs to maintain the reserve asset characteristics of SDRs channeled through the trust,” said the financial leader, adding that he is ready to consider options for channelizing SDRs to multilateral development banks. ..
“We call on additional IMF members to consider signing a voluntary SDR trading agreement to strengthen market capacity,” they said.
By David Lawder and Andrea Shalal