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World leaders back Biden G7 calls for more economic stimulus

Joe Biden garnered support at the G7 summit for a ‘spending continuation’ plan as Western leaders rejected austerity in a post-Covid world and pledged to tackle inequality at home and abroad. ‘foreign.

Biden’s call for continued economic recovery was backed by his fellow leaders at the Cornish summit in south-west England, in a rally framed by leaders as the West begins a retaliation against a rising China.

The US president opened the first session of the summit in Carbis Bay and – according to a witness – was supported by all G7 leaders as he called on the West to “respond now and support the economy”.

Mario Draghi, Italian Prime Minister and former head of the European Central Bank, followed Biden and said: “There are compelling arguments for expansionary fiscal policy.

Draghi argued that it was right to spend now, even if Western countries had to commit to long-term fiscal prudence to reassure markets and ensure central bankers don’t get scared and fall back. excessively interest rates.

In a statement that summarized the West’s apparent conversion to social democracy, summit host Boris Johnson said it was vital that the pandemic did not cause a “lasting scar” of inequality.

Opening the summit, he said: “It is vital that we do not repeat the mistakes of the last great crisis, the last great economic recession of 2008, when the recovery was not uniform across all parts of society.

The British Conservative Prime Minister has previously called the austerity policies adopted by the government of David Cameron, his predecessor, “a mistake”.

Johnson also said the recovery should be built with the environment in mind and in a “more neutral and feminine way”.

While G7 commitments are not binding, the West’s appetite for fiscal expansion sets the stage for delicate talks this fall between Johnson and his fiscally conservative Chancellor Rishi Sunak.

G7 countries will use the summit to pledge to increase spending to help the developing world, with a clear message that the West offers an alternative to the support offered by Beijing.

The leaders agreed to deliver 1 billion doses of vaccines to the poorest countries, in response to China’s “vaccine diplomacy”. The United States has claimed that Beijing is offering its medical aid with “conditions attached.”

The G7 will use weekend meetings to discuss a plan to help poor countries tackle climate change, a capital investment program devised by some UK officials as a counterweight to China’s global infrastructure agenda “the Belt and the Road”.

Meanwhile, the summit will approve plans for a new tax system for larger multinational corporations, though there is still a dispute over which companies should fall within its scope.

US President Joe Biden and French Emmanuel Macron walk together by the sea during the G7 summit © Phil Noble / Reuters

Biden does not want an excessive burden on American tech companies, while Britain is fighting to exclude the big banks. “The United States does not see a conceptual basis for excluding financial services,” said a US Treasury official.

After four years of Donald Trump’s presidency, as the G7 has become a dark forum of division and resentment, the mood on the Cornish coast was decidedly optimistic at the start of the three-day summit.

Emmanuel Macron, French President, threw his arm around Biden – on his first trip abroad as US President – on the beach at Carbis Bay and discussed the need for democracies to work for “the classes averages ”.

Meanwhile, Canadian Justin Trudeau – who had previously warned that austerity programs had contributed to the rise of populism – was among those who plunged into the sea.

On Friday evening, G7 leaders and partners traveled to the Eden Project, a futuristic environmental park, to meet Queen Elizabeth and other members of the royal family. On Saturdays, a barbecue on the beach is planned.

The summit continues on Saturday with a new discussion on the economy, foreign policy and health; it ends at lunchtime on Sunday after a discussion on the fight against climate change.

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