Leaders of the Group of Seven industrialized nations pledged during a call on Friday to sustain government spending to help economies recover from the coronavirus pandemic as they attempted to start a new chapter in multilateral cooperation.
As U.S. President Joe Biden made his debut as leader on the world stage the discussion centered on how to, in the words of British host Boris Johnson, “build back better” after the health crisis.
“We will continue to support our economies to protect jobs and support a strong, sustainable, balanced and inclusive recovery,” the G-7 said in a statement published after the call. “Recovery from Covid-19 must build back better for all.”
The G-7 nations committed to considering debt relief for developing nations and promised to eliminate net carbon emissions by 2050 at the latest.
Global Rebound
They also underlined the importance of multilateralism, a sign that the group wanted to move past the Donald Trump era. It agreed to strengthen the World Health Organization, a body that the previous U.S. administration had chastised and then withdrawn from.
“Drawing on our strengths and values as democratic, open economies and societies, we will work together and with others to make 2021 a turning point for multilateralism and to shape a recovery that promotes the health and prosperity of our people and planet,” the leaders said in their communique. “We will intensify cooperation on the health response to Covid-19.”
The pledge to keep spending taps running also recalls the commitments made after the financial crisis of 2008, when leaders promised to coordinate policy. It’s an acknowledgement that economies benefit from strong demand outside their own borders.
Differences Over China
The call was also an opportunity for western leaders to start to sketch out a plan for dealing with China and its growing might in areas from trade to technology. That’s an issue their nations are increasingly at odds over.
German Chancellor Angela Merkel, in her final year as leader after 16 years in office, said the G-7 wanted to bolster cooperation with the country.
”We have made clear that the recovery has to be about a mutually beneficial and fair economic system,” Merkel told reporters after the call. “Here the G-7 says that we want to cooperate with the G-20, especially with China.”