U.S. Treasury Secretary Janet Yellen testifies before the House Financial Services Committee regarding the department’s annual report on the international financial system, on Capitol Hill in Washington, on July 9.Ken Cedeno/Reuters
U.S. Treasury Secretary Janet Yellen faces questions from G20 finance leaders this week over U.S. policy commitments after President Joe Biden dropped his re-election bid and as international angst grows about a potential return of Donald Trump to the White House.
Yellen’s July 22-27 trip to Brazil for a Group of 20 finance ministers and central bank governors meeting marks the first major engagement of a Biden administration cabinet official with international counterparts since Biden’s decision on Sunday to step aside and endorse Vice President Kamala Harris to become the Democratic Party’s presidential nominee.
Yellen aims to press ahead at the Rio de Janeiro G20 meeting with U.S. efforts to boost growth through green energy incentives, increase multilateral development bank lending to address climate change and tackle debt distress in poor countries, a senior U.S. Treasury official said. She will also emphasize support for Ukraine and speak on China’s manufacturing capacity.
But questions over the continuity of U.S. policies in the wake of Biden’s decision will be high on the minds of G20 officials at the meetings, participants and analysts said.
“The situation in the U.S. is really in the spotlight as a background to this meeting,” a European G20 delegate said.
The delegate added that questions over a Trump victory and U.S. commitments on climate, taxes and other issues are “basically what everybody has in mind in terms of how sustainable are the things that we now agree.”
Such questions will likely come up in Yellen’s private conversations, but not likely the formal G20 sessions on the global economy, debt restructurings, climate, and taxation, said Josh Lipsky, senior director of the Atlantic Council’s GeoEconomics Center in Washington.
Officials will want to hear more from Yellen about Harris’ economic priorities, he added.
“She can say we are focused on the policy – fully – and we’ll let the politics play out, but no one should question the future of U.S. leadership in the global economy and its commitment to economic multilateralism,” said Lipsky, a former International Monetary Fund official.
Yellen will focus squarely on the G20 agenda at the meeting, the U.S. Treasury official said when asked on Friday about international concerns over rapidly evolving U.S. election politics. Yellen is a “really important voice” on global economic issues and “people want to hear from her about her policy views and that’s what I expect us to talk about,” the official added.
The U.S. election was already looming large over the G20 presidency in Brazil, where officials see the July 25-26 meeting as a last chance ahead of the November vote to secure support on initiatives such as a global tax on billionaires to make taxation fairer and more progressive across countries.
Biden has proposed a U.S. tax on wealth over $100 million, but Yellen has voiced opposition to any such tax that would redistribute revenues among countries. The Treasury official said that it was important for the G20 to emphasize principles of progressivity in taxation, but a “single global billionaires tax” was unlikely.
After the G20 finance meeting, Yellen will travel on July 27 to Belem, Brazil, to meet with Amazon basin finance ministers and deliver remarks highlighting the Biden administration’s initiatives on climate change over the past three years.
“She will directly make the case that failure to address the existential threat of climate change and its impacts is bad economic policy and bad environmental policy,” the Treasury official said.