The US and its allies are building on actions to crack down on efforts by Russia to evade sanctions, US treasury secretary Janet Yellen said on Sunday.
“One of our core goals this year is to combat Russia’s efforts to evade our sanctions. Our coalition is building on the actions we have taken in recent months to crack down on these efforts,” Yellen said during a press conference at the sidelines of the third G20 Finance and Central Bank Deputies (FCBD) meeting.
“We will also continue to cut off Russia’s access to the military equipment and technologies that it needs to wage war against Ukraine,” she added.
Interestingly, India emerged as a key consumer of Russian oil following the invasion of Ukraine. India’s crude oil imports from Russia reached a record high in May. Russian purchases had then exceeded the combined shipments from Saudi Arabia and Iraq.
India, the chair of the G20 presidency this year, has maintained a strategic neutrality when it comes to the Russian invasion of Ukraine.
Yellen also said she was eager to build on the groundwork with China on several areas of mutual interest, including the restructuring of debt in poor countries.
“As the world’s two largest economies, we have an obligation to the people in our nations and the world to cooperate on areas of mutual concern,” Yellen said.
“Last week’s visit served as a step forward in putting our relationship on surer footing and establishing a resilient and productive channel of communication,” she added.
Meanwhile, with regards to the first part of the G20 MDB (Multilateral Development Bank) Experts Group report, penned by a panel headed by NK Singh and Larry Summers, Yellen said the MDB will need reforms before capital increases could be considered.
“First, I will work with the World Bank and my counterparts to push for a framework and principles for the targeted use of concessional financing for global challenges. This will enable us to deploy concessional financing toward areas of greatest impact.
“I will also be talking to counterparts about ideas for how we can help boost the World Bank’s concessional lending for both low-income countries and to support IBRD (International Bank for Reconstruction and Development) borrowers as they tackle global challenges like climate,” Yellen said.
“Second, the World Bank should create a mechanism to allocate additional resources to countries that seek Bank financing to combat global challenges,” she added.
Yellen said she would like to see the bank explore options for lending to sub-sovereign and supra-sovereign actors, like COVAX, to address global challenges.
“I look forward to collaborating with my counterparts to streamline the climate finance architecture—a significant source of concessional finance—and to make sure that the development banks and specialized funds work together to deliver maximum impact. We need the whole system to become more effective and efficient,” she added.
Yellen said the MDBs as a system could unlock $200 billion over the next decade.
“There is potential for even more if the MDBs undertake some of the longer-term and more complex recommendations in the G20 Capital Adequacy Framework report,” she added.
The MDB panel set up by the G20 to strengthen multilateral development institutions readied the first report by June-end, which was presented at the ongoing Finance Ministers and Central Bank Governors meeting at Gandhinagar.
Yellen also said work was ongoing to make international tax system fairer and fitter.
“A little less than two years ago, we reached a historic agreement on a Two-Pillar solution to address the tax challenges of our digitalized and globalized economies,” Yellen said.
“Today, many countries are moving forward to implement the global minimum tax on the earnings of large multinationals, which will end the race to the bottom on corporate tax rates,” she said.
“It will enable our government and others to implement tax systems that ensure multinationals pay their fair share and compete on a level playing field with small businesses,” she added.
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