800 measures to spur world economy
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LEADERS from the G20 group of nations yesterday agreed to boost flagging global growth, tackle climate change and crack down on tax avoidance. However, ties between the West and Russia plummeted to a new low over the crisis in Ukraine.
Security and climate change overshadowed talks in Brisbane, Australia, on boosting global economic growth, although the leaders did sign off on a package of measures to add an extra 2.1 percentage points to global growth over five years.
“This will add more than US$2 trillion to the global economy and create millions of jobs,” said a communique issued at the end of the two-day summit, which also committed to tackle global tax avoidance.
The communique from the Group of 20 wealthy and emerging nations revealed that the plan for jumpstarting growth includes investing in infrastructure, increasing trade and the creation of a global infrastructure hub that would help match potential investors with projects.
Leaders also aim to reduce the gap between male and female participation in the workforce by 25 percent by 2025, saying that would put 100 million more women in employment and reduce poverty.
The United States and other nations overrode host Australia’s attempts to keep climate change off the formal agenda. Australia is one of the world’s biggest carbon emitters per capita.
The final communique called for strong and effective action to address climate change with the aim of adopting a protocol, with legal force, at a United Nations climate conference in Paris next year.
US President Barack Obama put climate change squarely on the G20 agenda with a speech on Saturday calling on all nations to act, and committing US$3 billion to the Green Climate Fund. Japan yesterday pledged US$1.5 billion to the fund.
The leaders also agreed to unite in the fight against Ebola, which British Prime Minister David Cameron described as not only a humanitarian crisis but also a security threat. “The best way we can keep out people safe from Ebola is by tackling it at source,” Cameron said.
Speaking at the end of the summit, Australia’s Prime Minister Tony Abbott said countries will hold each other to account by monitoring implementation of their commitments to boost growth.
The group said the International Monetary Fund and OECD will also play a role in monitoring progress and estimating the economic benefits of the growth plan.
Abbott said countries agreed on more than 800 new measures to spur the global economy. “People right around the world are going to be better off,” he said.
But the G20, which represents around 85 percent of the global economy, faces an uphill struggle to implement its plan after international agencies downgraded their global growth forecasts in recent months.
Growth in China and Japan has weakened and Europe is teetering on the brink of another recession.
Abbott said the group had been most productive on the issue of trade, calling it the “key driver of growth.”
The leaders adopted reforms to streamline customs procedures and reduce regulatory burdens.
Despite Australia’s push to keep the summit focused on the economy, the meeting was largely overshadowed by tensions between Russian President Vladimir Putin and Western leaders over the escalating conflict in Ukraine.
Putin was the first leader to leave Australia. He told reporters he was going ahead of a final leaders’ lunch because he wanted to rest before returning to work.
Obama accused Russia of “invading Ukraine” and Britain warned of a possible “frozen conflict” in Europe. Several Western nations warned Russia of further sanctions.
Obama said Russia’s “isolation” was unavoidable.
“We would prefer a Russia that is fully integrated with the global economy,” he told a news conference. “But we are also very firm on the need to uphold core international principles ... you don’t invade other countries or finance proxies and support them in ways that break up a country that has mechanisms for democratic elections.”
Before leaving, Putin said a solution to the Ukraine crisis was possible, but did not elaborate.
Abbott has been particularly strong in his criticism of Russia since a Malaysia Airlines plane was shot down in July over a part of Ukraine controlled by pro-Russian rebels. Australia lost 38 citizens and residents in the MH17 disaster.
Abbott said he and Putin had engaged in a “very robust” discussion about Ukraine at the summit.
The G20 also tackled the issue of tax evasion by multinationals, declaring that profits should be taxed in the country where they are earned. There has been an ongoing effort by governments to crack down on the practice of companies such as Google and Amazon moving profits in one country to others with lower tax rates.
The G20 endorsed a common standard for the automatic exchange of tax information, to begin by 2017 or 2018.
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