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By Silvia Marchetti
ROME (MaceNews) – The G20 finance ministers and central bankers committed on Friday to pursuing accommodate fiscal and monetary policies and to step up joint efforts to tackle the COVID-19 pandemic.
During an online meeting held by Italy’s G20 presidency, member countries acknowledged that health and economic conditions remain difficult despite the launch of vaccination campaigns and signs of strengthening economic activity.
“It is essential to remain vigilant and to learn from previous crises. [We agreed that] any sudden, premature withdrawal of fiscal and monetary support should be avoided” given that “a return to normality” is impossible without the completion of the vaccination campaign, Italy’s finance minister Daniele Franco said at the post-meeting press conference.
Franco warned that the economic conditions in the short run remain challenging and said G20 members would take stock of pandemic responses and impact to define a shared strategy able to address a post-Covid world.
“The economic recovery is still fragile and uneven across countries. In this context, ministers and governors concurred on the importance to further strengthen policy cooperation to put the global economy on a path of stable and sustainable growth. Today, multilateralism is more important than ever and needs to be enhanced by closer coordination among G20 members,” said Franco.
Issues discussed at the G20 meeting include a ‘carbon tax’ to fight climate change, measures to reduce the widening social and economic gaps triggered by COVID, new tools to meet long-term financing tools for poor countries, and the need to reform the current international taxation system.
Franco said a tax on digital companies at global level remains a key issue.
Bank of Italy governor Ignazio Visco warned that any shift in monetary conditions could be possible “only with substantial recovery” signs and economic risks are still to the downside.
Visco said an assessment of the pandemic impact must start immediately to fully weigh whether the pre-COVID financial frameworks in place have been efficient. The G20 members have agreed to vet the need of any “necessary adjustments” with results expected lated in the year.
A G20 high-level independent panel has been established to promote preparedness against future pandemics. G20 countries are taking stock of the lessons already learned from a financial stability perspective. Ongoing work is focusing on strengthening the resilience of the nonbank financial intermediation sector, which played a part in the amplification of the March 2020 market turmoil.