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French Finance Minister Bruno Le Maire and U.S. Treasury Secretary Steven Mnuchin are doubling down on efforts to reach an agreement over the European country’s digital tax on large tech firms, after the Trump administration said it unfairly targets U.S. companies and threatened to levy a 100 per cent tariff on French wine and other products. The leaders will meet at the World Economic Forum in Davos later this month, where they plan to settle the dispute if they haven’t by then. (Financial Times)

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Talking point: Some French companies have warned the new sanctions would make them unsustainable in the U.S., and Le Maire, who called the sanctions “unfriendly, inappropriate and illegitimate,” said France will dispute the sanctions with the World Trade Organization if the U.S. follows through. The federal Liberals proposed a similar three per cent digital tax on big tech companies during their successful election campaign last fall. Even if France decides to walk back its tax scheme—it has not indicated it will—the U.S. will inevitably have to abide by a similar digital tax that the OECD plans to introduce. The proposed law would let countries levy their own tax rate, agreed to by OECD members, on foreign companies without a physical presence in their jurisdiction. Once passed, France has said it will replace its own digital tax with OECD’s.

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World Economic Forum programming has so-far been filled with optimistic panels speaking generally about tech’s potential to transform the world for good. However, they have yet to address the growing international techlash or the ongoing trade tensions between China and the U.S. over technology. Canadian tech was featured amidst the optimism, with RBC and the Ontario Teachers Pension Plan talking up how they use AI and blockchain. (Financial Times)

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Talking point: Davos is one of the world’s most elite networking events, meant to bring powerful people together to discuss tough issues. For example, one panel featured Alfred Kelly, CEO of Visa, and Ken Hau, a deputy chairman of Huawei, yet did not mention Meng’s arrest in Vancouver or Visa’s legal troubles in China. Those difficult topics are being discussed behind the scenes, particularly between U.S. and Chinese trade negotiators, who are meeting on the sidelines to resolve their ongoing trade war. Legislators across the world—including in Canada—are calling for tougher laws around antitrust and data privacy. Topics that the Davos crowd felt safe to discuss more explicitly, however, included Prince William on mental health and Angela Merkel defending the multilateral post-World War II global order.

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At a press conference before leaving the World Economic Forum in Davos, Switzerland, the U.S. president said he wants an agreement before the vote, scheduled for November 3. Accompanied by World Trade Organization (WTO) director general Roberto Azevêdo, he also promised a “very dramatic” change to the organization. (The Wall Street Journal)

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Talking point: Trump has threatened tariffs on European auto imports if the continent doesn’t make a deal on trade, a bargaining tactic he’s used against China as well as Canada and Mexico. His administration has also blocked appointments to the WTO’s appeals court over claims that the U.S. doesn’t get fair trials there, effectively rendering it unable to function. Canada has led an international effort to come up with reforms, and International Trade Minister Mary Ng is chairing a meeting of the group in Davos this week. Trump’s negotiations with Azevêdo—who he said will shortly visit Washington, D.C. for talks—circumvent that process. Trump also spent 30 minutes with over 30 tech executives gathered on Wednesday morning. Apple CEO Tim Cook—whom the president recently criticized over encryption—and IBM CEO Ginni Rometty reportedly pushed for the White House to expand access to skills training.

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Members of the Climate Finance Partnership, a group led by BlackRock that includes France, Germany and the Hewlett and Grantham charitable foundations, will provide the first US$100 million, which will be used as a safety net for possible losses incurred by other institutional investors for the remaining US$400 million. The fund will focus on projects in Africa, Southeast Asia and Latin America. (The Logic)

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Talking point: This is the latest in a string of climate-related commitments from the world’s biggest asset manager. In his annual letter to chief executives last week, BlackRock CEO Larry Fink stressed the need to address climate change in business and investment decisions; he committed to doubling the number of ESG exchange-traded funds and dropping portfolio firms with more than a quarter of their revenues from thermal coal. Days earlier, BlackRock signed onto Climate Action 100+, a global initiative in which institutional investors pressure the biggest carbon-emitting companies to curb their environmental impact. BlackRock’s investment decisions tend to have a ripple effect in the finance community, with its stance on gun control and corporate responsibility, for example, driving industry-wide change. The concept of considering climate change in financial decisions already had momentum before BlackRock went all in on the file, but its new commitments could sway some holdouts or encourage bolder strategies.

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The U.S. president touted “an economic boom, the likes of which the world has never seen before,” and called climate activists “prophets of doom.” In an earlier speech, Greta Thunberg called for an immediate end to fossil-fuel investments, extraction and subsidies. Meanwhile, Finance Minister Bill Morneau, Innovation Minister Navdeep Bains and International Trade Minister Mary Ng headed to the WEF on Tuesday to represent the federal government. (Associated Press, The Guardian, The Logic)

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Talking point: Economists fact-checking Trump in real time disputed his claims of unprecedented U.S. GDP growth during his presidency, and that he deserved credit for it. His message was also out of line with this year’s event—climate change risks topped the WEF’s annual list of long-term threats. Thunberg’s message was closer, though she also called out attendees for inaction. Fellow teen activist Autumn Peltier, of Wiikwemkoong First Nation in Ontario, similarly said Canadian politicians are insufficiently focused on climate change. However, above-average stock market performance and tax cuts in the U.S. have reportedly softened Davos-going executives’ attitudes toward the president, who’s making his second appearance at the conference.

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The five Nordic countries topped the measure, but the organization said “only a handful of nations” were creating the necessary conditions for upward movement. The WEF recommended governments make personal income taxes more progressive, introduce policies that “address wealth concentration,” spend more on education alongside the private sector and create new social safety systems. (The Logic)

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Talking point: The WEF conference in Davos, Switzerland—which opened Monday—is criticized because it brings together the politically and economically influential who have not yet used their power to make the kinds of changes it recommends. The organization stopped short of endorsing a wealth tax, but its recommendations fit the broad themes of the event’s 2020 edition: making economies more fair and preparing for the future of work by reskilling. A third topic, saving the planet, will be a key focus for Ottawa’s delegation, with Innovation Minister Navdeep Bains reportedly set to talk up the Liberals’ cleantech tax cut promise. Tuesday’s schedule includes two of the loudest opposed voices on the climate crisis: U.S. President Donald Trump and climate activist Greta Thunberg are both due to speak.