G7 should invest $10 trillion to stoke climate-friendly recovery, PM Johnson told

FILE PHOTO: A man wearing a protective face mask walks past an illustration of a virus outside a regional science centre in Oldham, Britain August 3, 2020. REUTERS/Phil Noble

LONDON — G7 countries should invest $10 trillion to stoke an investment-driven recovery that puts COVID-19 vaccines in arms and triggers a sweeping energy transformation to slow climate change, according to a report requested by Prime Minister Boris Johnson.

U.S. President Joe Biden is expected to join other Group of Seven leaders at a G7 summit chaired by Britain’s Johnson in Cornwall, southern England, on June 11-13.

Founded in 1975 as a forum for the West’s richest nations to discuss crises such as the OPEC oil embargo, the G7 will discuss what it perceives as the biggest threats: China, Russia, climate change, and the coronavirus pandemic.

Nicholas Stern, professor of economics at the London School of Economics, said in a report for Johnson that the G7 was a crucial opportunity for the West’s richest economies to make a real change to the global economy.

“The transition to a zero-emissions and climate-resilient world provides the greatest economic, business, and commercial opportunity of our time,” Stern said in the report.

“At the heart of the proposed vision for the economic response to the pandemic is a coordinated global program of investment for recovery, reconstruction, and transformation that can boost all forms of capital – physical, human, natural, and social,” Stern said.

G7 countries, he said, should set a collective goal to raise annual investment by 2% of GDP above pre-pandemic levels for this decade and beyond and improve the quality of investment – equal to about $1 trillion per year in additional investment over the next decade.

The G7 leaders should ensure a timely global roll-out of vaccines by immediately closing the $20 billion funding cap of COVAX, a global program to provide vaccines mainly for poor countries.

After Johnson called for countries to do more than produce “hot air” rhetoric on climate, the report said the G7 should come up with credible ways to meet Biden’s climate goals.

The G7 should commit to eliminating all fossil-fuel subsidies no later than 2025, lead a sweeping energy transition, end overseas support for fossil-fuel investments and consider a minimum corporate profit tax of 21%.