Correspondent in Rome
The summit of G-20 will conclude this Sunday in Rome, with a good atmosphere among the leaders of the main economies of the world to improve the fight against the pandemic and relaunch the economy with greater social justice, but the difficulties remain to reach a compromise between the West and the Asian powers, like China and the India, on reduction of C02 emissions.
The draft of the final communiqué leaked on Saturday is vague about the climate emergency: there is no firm agreement with measures, but rather that the objective is to limit global warming to the level of 1.5 degree centigrade, which scientists say is vital to avoiding a climate disaster. Until the last minute, the Italian presidency of the G-20 will work to improve the official statement that will be released on Sunday afternoon, but the draft, which is already the fifth of the joint G-20 statement, shows the tough diplomatic negotiations between countries.
«We remain committed – the draft is limited to saying – with the objective of the Paris Agreement to keep the increase in the global average temperature below 2 ° C and to continue striving to limit it to 1.5 degrees Celsius above the levels pre-industrial ”.
That is, while the objective of the West was in principle to reach a firm agreement on net zero emissions by 2050, with significant reductions by 2030 and a commitment to stay below the 1.5 degrees Celsius increase in temperature from now until the end. of the century, China remains on its plan to reach zero emissions by 2060, as does India. It should be noted that China, the largest polluter on the planet, with only one of its companies, China Petroleum & Chemical, controlled by the oil giant Sinopec, contributes more to global warming than Canada and Spain combined.
It would not be a good sign if the summit of Roma will end with a vague statement about the climate change, because the countries that make up the G-20 represent more than 80% of world GDP, 75% of world trade, 60% of the planet’s population and also, according to various estimates, almost 80% of greenhouse gas emissions. Hence, the result of the G-20 may mark the debate at the twenty-sixth Climate Summit, the UN-sponsored COP26, which begins tomorrow in Glasgow (Scotland), attended by representatives of 197 countries, with the aim of reaching concrete agreements to reduce emissions.
Global tax revolution
In the opening speech of the summit, which takes place at the La Nuvola Congress Center in the EUR district, south of Rome, the Prime Minister, Mario Draghi, current president of the G-20, stressed that “we can look to the future with optimism”, underlining some objectives that have already been approved, in particular “the historic agreement for a fairer and more efficient international tax system.” Experts consider that this is a “global tax revolution”, because it will prevent companies, especially multinationals, from taking their profits to tax havens.
It was given the go-ahead, after years of stagnation, on July 1 at the Organization for Economic Cooperation and Development (OECD). There are two most important consequences: First, the large multinationals (around a hundred with revenues of more than 20,000 million euros) may be forced to pay taxes in the countries where they make their profits, and not only in the nations where they establish their fiscal residence. On the other hand, countries that have multinational companies in their territory with at least 750 million euros in turnover, can impose a minimum tax of 15%. According to calculations by the Organization for Economic Cooperation and Development (OECD), the ‘global minimum tax’ could generate added income to the countries worth about 150,000 million euros, which today largely escapes the treasury.
A “new economic model”
The economic recovery after the pandemic has also focused the debate at the summit. The world economy appears to be on track, according to the latest data from the International Monetary Fund, with the forecast of 5.9% growth in 2021).
Mario Draghi stressed that with “recovery plans to stimulate growth”, “a new economic model that will benefit the whole world” is being built and considered that multilateralism is the answer to new challenges: “Faced with protectionism, unilateralism and nationalism, the best answer to the problems we face today is multilateralism. In many ways, it is the only possible solution. From the pandemic to climate change and fair and equitable taxes, doing all this alone is not a possible option, “said Draghi at the first session of the summit, dedicated to” global health and economy. ”
George is Digismak’s reported cum editor with 13 years of experience in Journalism