On U.S. Secretary of the Treasury Janet L. Yellen’s first trip to Canada as Secretary of the Treasury, she reinforced the common priorities shared by the U.S. and Canada in securing global security and economic prosperity and stability. in a series of engagements with Deputy Prime Minister Freeland, Secretary Yellen discussed U.S. collaboration with Canada on a range of issues including improving supply chains and other efforts to bring down inflation, increasing economic pressure on Russia and the continued commitment to support Ukraine, as well as joint efforts to mitigate the global consequences being felt because of Russia’s aggression.
Secretary Yellen and Deputy Prime Minister Freeland held a bilateral meeting, participated in a fireside chat, and visited an innovation hub where they discussed how friend-shoring can help make sure consumers aren’t paying more because of bottlenecks or supply disruptions.
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Bloomberg: Yellen Urges Less Dependence on Other Nations for Key Supplies
[By: Christopher Condon and Danielle Bochove, 6/20/22 ]
Treasury Secretary Janet Yellen said the US should work on shifting its dependence away from some rival nations for supplies of critical inputs as global supply-chain logjams have hurt the domestic economy.
“We saw during the pandemic that our supply chains were very brittle and really lacking in resilience,” she said Monday.
Yellen repeated her support for so-called friend-shoring, saying “countries that espouse a common set of values about international trade and conduct in the global economy should trade and get the benefits of trade so we have multiple sources of supply and are not reliant excessively on sourcing critical goods from countries where, especially, we have geopolitical concerns.”
“A friend-shoring group could be a reasonable large set of countries,” she added.
Yellen made the comments during a trip to Toronto where she appeared alongside Canadian Finance Minister Chrystia Freeland.
The Treasury chief noted that the US is “enormously dependent” on geopolitical adversary China for rare-earth metals, key components in making so-called permanent magnets used in everything from lithium-ion batteries to electric vehicles.
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Supply-chain issues have contributed to accelerating consumer-price growth. Prices climbed 8.6% in May from a year earlier, the fastest pace in four decades, while fears have intensified of a recession on the horizon as the Federal Reserve raises rates to curb inflation.
Canada is a potential source of some products that countries have for many years obtained from China and Russia, Freeland said.
“What we can really contribute in a world of friend-shoring is critical metals and minerals and energy,” she said.
The US already imports many minerals from Canada, including cobalt, nickel, aluminum and graphite. Freeland pointed out her government has earmarked C$3.8 billion ($3 billion) in its federal budget to implement a new critical minerals strategy over eight years.
Reuters: Yellen, Canada's Freeland to present united front on Ukraine, inflation-Treasury
[By: David Lawder, 6/20/22]
U.S. Treasury Secretary Janet Yellen will meet with Canadian Finance Minister Chrystia Freeland in Toronto on Monday where they will discuss the Ukraine war and joint efforts to deal with the food and fuel price inflation it is causing.
The Treasury said that Yellen during the visit will highlight strong economic ties between the two North American allies, visiting a business incubator and participating in a public forum at the University of Toronto.
“Throughout, Secretary Yellen will reinforce the common priorities shared by the U.S. and Canada in securing global stability and prosperity,” the Treasury said in a statement, adding that this includes cooperation to strengthen supply chains and bring down inflation.
The two finance ministers will discuss sanctions and other joint efforts to increase economic pressure on Russia to end its war in Ukraine, the Treasury said.
“They’ll also discuss joint efforts to mitigate the global consequences being felt because of Russia’s aggression, including the need to boost production of fossil fuels in the short term to address high gas and energy costs, and reiterate the importance of adopting clean energy technologies that break our dependence over the medium-term,” Treasury said.
The visit is the first to Canada for Yellen as Treasury secretary.
Reuters: Countries would implement minimum corporate tax to avoid revenue loss, says Yellen
[By: David Lawder and Ismail Shakil, 6/20/22 ]
TORONTO, June 20 (Reuters) - U.S. Treasury Secretary Janet Yellen said on Monday that once some countries start implementing a global minimum tax on multi-national companies, other countries with a lower corporate tax rate would need to follow along or risk losing tax revenues
"When some countries opt into this (minimum corporate tax) and put these taxes in effect, it'll begin to be more and more that see that it's in their interest to join up," Yellen said at a discussion with Canadian Finance Minister Chrystia Freeland in Toronto.
Some 136 countries agreed a global deal in October 2021 to ensure big companies pay a minimum tax rate of 15% and make it harder for them to avoid taxation, but such a tax has not yet been implemented anywhere.
Toronto Star: Freeland, Yellen say they are working together to combat soaring global inflation
[6/20/22]
TORONTO - Finance Minister Chrystia Freeland and U.S. Treasury Secretary Janet Yellen say they recognize consumers are feeling the pain of high inflation and that their two countries are working together to combat price pressures by ensuring supply chains are more resilient.
The pair spoke about the turbulent global economy at a joint news conference in downtown Toronto on Monday afternoon, which marks Yellen’s first trip to Canada as secretary of the Treasury.
During the news conference, Freeland said there is a historic opportunity to ensure resiliency in supply chains after Russia’s Feb. 24 invasion of Ukraine marked the end of an era in global relations.
“Our allies know that it’s worth strengthening our partnerships and building their supply chains with other democracies,” said Freeland.
The war in Ukraine has led to severe disruptions in the energy market and driven up oil prices globally. Yellen said better supply chains with allies will help create more price stability across the economy the long run.
“Both of our countries face high inflation driven by global factors like lockdowns in China and Russia’s war in Ukraine. Making our supply chains more resilient, including with partnerships with close trading partners and allies like Canada will help protect us against costly disruptions and shocks to the economy today and into the future.”
At their meeting, Freeland and Yellen said they discussed how to keep costs down for families on both sides of the border amid soaring consumer prices, as well as how the countries can continue to stand united against Russia’s invasion of Ukraine, especially when it comes to restricting energy revenues to Russia.
Both Freeland and Yellen emphasized the role of central banks in managing inflation, but acknowledged that governments have a part to play by keeping debt and deficits down.
Freeland said that federal government has moved to shrink spending, with a rate of fiscal consolidation matched only by the U.S. among G7 nations.
“Our government certainly respects the independence of the Bank of Canada, but we understand that fiscal policy has a role to play. That’s why we took this decision in April to pursue a path of really swift ... fiscal tightening.”
She said the government decided to maintain the affordability measures in the April budget, and last year’s budget, rather than introduce new ones as inflation rises, in part to avoid further inflation stimulus.
Last month, Statistics Canada reported the inflation rate for April rose 6.8 per cent compared with a year ago. That’s the highest since January 1991 but is lower than Britain, Germany and the United States.
