EU taxation of multinationals—bypassing the unanimity blockage – by Tommaso Faccio and Francesco Saraceno

he French car-service company Heetch recently displayed an advertising campaign on the streets of Paris (see photo), which proudly affirmed its presence in many French cities but not in Luxembourg—a clear allusion to the tax headquarters of some of its competitors. The fact that ‘paying taxes in France’ has become a commercial argument shows that the issue of corporate avoidance is rising up the public agenda in many countries.

Yet the G20 process on taxing digital firms and introducing a global minimum tax to limit tax competition, led by the Organisation for Economic Co-operation and Development, failed to reach consensus in 2020, mostly because of determination by the United States to protect its digital giants. The European Commission has made clear that, were the G20 to fail to deliver a global solution by mid-2021, it will act. But the EU is stuck between a rock—the US position will likely not change with the new administration—and a hard place: its own tax havens.

Read more at: EU taxation of multinationals—bypassing the unanimity blockage – Tommaso Faccio and Francesco Saraceno

Iran-US relations:Trump Blew Up The Iran Nuclear Deal. Now He Wants Allies To Help Him Get An Iran Nuclear Deal. - by S.V. Date

Having estranged allies with threats and false accusations, President Donald Trump now faces dealing with the latest crisis he has generated, Iran, without any allies at all.

Trump prepares to meet Thursday and Friday with leaders of the world’s largest industrial economies at the G-20 summit in Japan with the idea, according to the White House, of gaining their cooperation in lowering tensions with Iran. “This is a chance for the president to engage with a number of different international leaders, among our closest partners and allies, to obtain their support and to have discussions about how we can encourage Iran to enter into negotiations,” a senior administration official said this week on condition of anonymity.

Read more :Trump Blew Up The Iran Nuclear Deal. Now He Wants Allies To Help Him Get An Iran Nuclear Deal. | HuffPost

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CHINA-US relations; G20 summit: XI and Trump agree to restart China-US trade talks

G20 summit: Trump and Xi agree to restart US-China trade talks

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https://www.bbc.co.uk/news/world-48810070

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G20: US contributes nothing positive to G20: "communique exposes divide with U.S. on climate policy" - by P. Carrel and N. Barkin

The final statement from Group of 20 leaders on Saturday exposed a divide between the United States and other G20 members on the Paris accord aimed at combating climate change.

German Chancellor Angela Merkel, hosting the two-day G20 summit, said she was pleased all club members besides the United States had agreed the Paris climate accord was irreversible.

"I think it's very clear that we could not reach consensus, but the differences were not papered over, they were clearly stated," Merkel told reporters at the end of the two-day meeting.

She said she did not share the view of British Prime Minister Theresa May who said on Friday she thought Washington could decide to return to the climate agreement.

In the final communique, the G20 leaders took note of the United States' decision to withdraw from the landmark accord.

"The leaders of the other G20 members state that the Paris Agreement is irreversible," the statement read.

On trade, another sticking point, the leaders agreed they would "fight protectionism including all unfair trade practices and recognize the role of legitimate trade defense instruments in this regard."

Trump, who on Friday found chemistry in his first face-to-face meeting with Russian President Vladimir Putin, congratulated Merkel on her stewardship of the summit.

"You have been amazing and you have done a fantastic job. Thank you very much chancellor," he said.

Read more: G20 communique exposes divide with U.S. on climate policy | Reuters

G20: Merkel takes aim at Trump ahead of stormy G20 summit

Merkel said that discussions at the July 7-8 gathering of world leaders in Hamburg would be difficult given Trump's climate scepticism and "America First" stance, but that she was determined to seek a clear commitment for the Paris accord against global warming and a pledge against protectionism.

When Trump announced in early June he would withdraw from the Paris deal, "we knew that we could not expect discussions to be easy" at the G20 summit, 

 

Merkel told the German parliament"The differences are obvious and it would be dishonest to try to cover that up. That I won't do," she said, adding that the US exit from the 2015 Paris pact had made Europe "more determined than ever" to make the accord a success.

Without naming names, she also warned that "those who think that the problems of this world can be solved with isolationism or protectionism are terribly wrong" and pledged to seek a "clear signal for open markets and against sealing off" at the summit.

Read more: Merkel takes aim at Trump ahead of stormy G20 summit | SBS News

Earth Day: April 22: The G20’s Time for Climate Leadership, as Trump Adm. ready to block project - by Teresa Ribera

Global Warming Disaster:The question is not if but when

At the start of 2016, the United States was well positioned to lead the global fight against climate change. As the chair of the G20 for 2017, German Chancellor Angela Merkel had been counting on the US to help drive a deep transformation in the global economy. And even after Donald Trump won the US presidential election, Merkel gave him the benefit of the doubt, hoping against hope that the US might still play a leading role in reducing global greenhouse-gas emissions.

But at Merkel and Trump’s first in-person meeting, no substantive statements were issued, and their body language made the prospect of future dialogue appear dim. Trump’s slogan “America first” seems to mean “America alone.”

By reversing his predecessor’s policies to reduce CO2 emissions, Trump is rolling back the new model of cooperative global governance embodied in the 2015 Paris climate agreement. The countries that signed on to that accord committed themselves to sharing the risks and benefits of a global economic and technological transformation.

Trump’s climate-change policy does not bode well for US citizens – many of whom are now mobilizing resistance to his administration – or the world. But the rest of the world will still develop low-carbon, resilient systems. Private- and public-sector players across the developed and developing worlds are making the coming economic shift all but inevitable, and their agendas will not change simply because the US has a capricious new administration. China, India, the European Union, and many African and Latin American countries are still adopting clean-energy systems.

As long as this is the case, businesses, local governments, and other stakeholders will continue to pursue low-carbon strategies. To be sure, Trump’s policies might introduce new dangers and costs, domestically and worldwide; but he will not succeed in prolonging the fossil-fuel era.

Still, an effective US exit from the Paris agreement is a menacing development. The absence of such an important player from the fight against climate change could undermine new forms of multilateralism, even if it reinvigorates climate activism as global public opinion turns against the US.

More immediately, the Trump administration has introduced significant financial risks that could impede efforts to address climate change. Trump’s proposed budget would place restrictions on federal funding for clean-energy development and climate research. Likewise, his recent executive orders will minimize the financial costs of US businesses’ carbon footprint, by changing how the “social cost of carbon” is calculated. And his administration has already insisted that language about climate change be omitted from a joint statement issued by G20 finance ministers.

These are all unwise decisions that pose serious risks to the US economy, and to global stability, as United Nations Secretary-General António Guterres recently pointed out. The US financial system plays a leading role in the world economy, and Trump wants to take us all back to a time when investors and the general public did not account for climate-change risks when making financial decisions.

Since 2008, the regulatory approach taken by the US and the G20 has been geared toward increasing transparency and improving our understanding of possible systemic risks to the global financial system, not least those associated with climate change and fossil-fuel dependency. Developing more stringent transparency rules and better risk-assessment tools has been a top priority for the financial community itself. Implementing these new rules and tools can accelerate the overall trend in divestment from fossil fuels, ensure a smooth transition to a more resilient, clean-energy economy, and provide confidence and clarity for long-term investors.

Given the heightened financial risks associated with climate change, resisting Trump’s executive order to roll back Wall Street transparency regulations should be a top priority. The fact that Warren Buffet and the asset-management firm Black Rock have warned about the investment risks of climate change suggests that the battle is not yet lost.

Creating the G20 was a good idea. Now, it must confront its biggest challenge. It is up to Merkel and other G20 leaders to overcome US (and Saudi) resistance and stay the course on climate action. They can count as allies some of the world’s large institutional investors, who seem to agree on the need for a transitional framework of self-regulation. It is incumbent upon other world leaders to devise a coherent response to Trump, and to continue establishing a new development paradigm that is compatible across different financial systems.

At the same time, the EU – which is celebrating the 60th anniversary of the Treaty of Rome this year – now has a chance to think about the future that it wants to build. These are difficult times, to be sure; but we can still decide what kind of world we want to live in.

Note EU-Digest: the EU needs to take its own independent and united position on this issue. Compromise should not be part of the equation. In addition, it has become extremely difficult  for any country to negotiate with the Trump Administration on just about any issue, given they change their position more often than the Kama Sutra.

 

Read more: The G20’s Time for Climate Leadership by Teresa Ribera - Project Syndicate 
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