G7 Finance Ministers Reject ‘Barter’ For Ukraine Support

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US Treasury Secretary Janet Yellen tried yesterday at a meeting of G7 big moneymakers (US, Japan, Germany, UK, France, Italy and Canada) in India to allay concerns that which massive support for Ukraine would come at the expense of aid to developing countries.

“I reject the idea of a barter” between these two issues, which are in fact closely associated, she said, according to comments collected by AFP during a press conference in Gandhinagar, in the west. India, where a G7 Finance is held ahead of a similar G20 meeting today and Tuesday. A “key priority” is to “redouble our support for Ukraine” because “ending this war is above all a moral imperative. But it’s also the best thing we can do for the global economy,” said Ms. Yellen, echoing comments she had already made in November just before the G20 summit in Bali.

Russia’s intervention in Ukraine, two major breadbaskets on the planet, has sent shockwaves through the global economy since last year by inflating food and energy prices. An agreement on Ukrainian grain exports transiting through the Black Sea expires today, and Moscow is refusing to renew it so far.

The “illegal” war launched by Russia in Ukraine is one of the causes of the recent worsening of the over-indebtedness of developing countries, Ms Yellen argued yesterday.

The G7 countries are determined to support Ukraine as long as necessary to repel the Russian invasion, as they recalled earlier this week in Vilnius, on the sidelines of a NATO summit. Insisting on support for Kyiv, however, may be potentially uncomfortable for the G20 host country this year, with India failing to condemn Russia’s offensive in Ukraine so far. Many countries in the South are also reluctant to openly take sides on the subject.

“Mistrust” and “frustration”

Eager to demonstrate that the industrialized countries are not sparing their efforts for the emerging countries either, Ms Yellen mentioned a series of advances or reforms on various fronts in terms of development aid, which will be discussed at the G20 Finances of Gandhinagar. She thus cited the ongoing efforts to reform the multilateral development banks, starting with the first of them, the World Bank, in order to boost their effectiveness by better adapting their aid to the immense challenge of global warming. .

She also mentioned progress in restructuring the debt of countries such as Zambia, and said she was counting on the imminent finalization of similar files for Ghana and Sri Lanka.
On difficult US-China relations, another fault line in the G20, Ms Yellen, who visited China earlier this month, said yesterday it would be ‘premature’ to lift trade restrictions vis-à-vis Beijing, initiated by the previous American president, Donald Trump.

These trade barriers “were put in place because we had concerns about unfair trade practices by China”, but this problem “continues”, according to Ms. Yellen.

The G20 Finances of Gandhinagar, a new Indian town, created in the 1960s and named in honor of the national hero of independence, Gandhi, will also be an opportunity to continue negotiations for an international agreement on the taxation of multinationals. A preliminary project in this direction has been validated by nearly 140 countries under the aegis of the Organization for Economic Co-operation and Development (OECD), but there are still stumbling blocks.

For his part, the new president of the World Bank, Ajay Banga, worried this week about the “deep mistrust” separating the countries of the North and the South, “at a time when we must unite” to overcome the challenges. “interrelated” that are the fight against global poverty, the “existential” climate crisis and the post-pandemic economic recovery jeopardized by inflation and the war in Ukraine

. “The frustration of countries in the South is understandable. In many ways, these countries are paying the price for the prosperity of other states (…). They are worried that the means that have been promised to them will be redirected for the reconstruction of Ukraine, ”he said in a column published online.

This article is originally published on elwatan-dz.com

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