A/66/PV.78 General Assembly
My delegation associates itself with the statement made by the representative of Argentina on behalf of the Group of 77 and China.
The convening of this fifth High-level Dialogue on Financing for Development is particularly timely given the current international economic situation. The situation has rarely been so inauspicious for development. The continuing economic and financial crisis has been compounded by a serious debt crisis in developed countries; exacerbated difficulties in developing countries; and led to a low, if not non-existent, level of growth, with the possibility of achieving the Millennium Development Goals slipping yet further away.
The drastic measures taken by the developing countries to tackle the effects of the crisis have had an adverse impact on developing economies. Austerity measures have led industrialized countries in general to reduce, first and foremost, official development assistance (ODA), and it seems that the situation will continue, given the various budget austerity measures adopted by a number of developed countries.
That reduction in aid contrasts with the growing needs of developing countries for emergency aid, as a result of natural disasters, or to give impetus to their economic and social development. In that respect, a recent study undertaken by the World Food Programme showed clearly that the number of natural disasters is continuing to rise.
Our industrialized partners must understand that ODA is an investment that ultimately benefits the international community as a whole, including the developed countries themselves. The High-level Plenary Meeting of the General Assembly on the Millennium Development Goals, held in 2010, rightly underscored the critical importance of upholding ODA commitments. We must put an end to the reduction of this essential form of aid, and donor countries must work to reach, at the earliest possible time, the goal of 0.7 per cent of gross domestic product for developing countries and from 0.15 to 0.2 per cent for aid to the least developed countries.
The economic crisis should not be used as a pretext for developed countries to shirk their commitments. Official development assistance flows should be enhanced, predictable and consistent. Innovative mechanisms for development financing should be sought so as to complement ODA. But such capital must flow towards development; there can be no compromise in that respect. These new flows should be allocated to development according to the priorities of developing countries and should not generate additional debt. Nor should they affect or substitute for ODA. We should also consider expanding the allocation of the special drawing rights of the International Monetary Fund as a potential source of financing for development, which has the advantage of being flexible, effective and low-cost.
It is only right that the countries of the South, to finance development, should turn first and foremost to their own resources. Nevertheless, in many cases such resources are not even sufficient to provide for the basic needs of their peoples. Few developing countries have enough resources of their own to provide for both their current social needs and their long-term development needs, and many are fully reliant on official development assistance.
Generally speaking, developing countries continue to take measures aimed at streamlining public expenditures, countering wasteful practices, improving tax collection and, when possible, broadening the tax base. However, this latter measure is very difficult to implement in countries where people are living on less than $2 a day.
With respect to external revenue, many developing countries, in particular the least developed countries, depend on the export of a limited number of products — sometimes just one single product. Such exports do not bring in much revenue and are subject to strong price fluctuations. Thus external revenue is very difficult to predict and makes budgeting that much harder.
Diversifying exports for this category of countries is of crucial importance. It will require significant investments in terms of funding and human resources, which they lack. Thus foreign aid is necessary for development, foreign direct investment and technical assistance, as many of those countries do not have sufficient economic means to bring about
diversification of exports and to attract foreign investment.
In many cases, foreign investment is but temporary aid with a reverse capital flow — meaning that eventually the recipient countries see such flows, now several times the amount of the initial investment, transferred back to the investors’ countries of origin after only a few years of activity. Such flows, often compounded by debt reimbursement, represent a major drain on resources.
The Monterrey Consensus remains of the utmost relevance and must be implemented by the international community in an integral and urgent manner. The Consensus is one of the most important achievements of the United Nations, but there has not been sufficient follow-up. It is pivotal that its follow- up be adequate, coordinated and coherent, within the framework of the United Nations and in the broadest possible spirit of cooperation.
Allow me at the outset to extend to President Al-Nasser our thanks and appreciation for his efforts in guiding the work of this important meeting. The United Arab Emirates reaffirms the importance of implementing the recommendations of the 2002 International Conference on Financing for Development and the 2008 Doha Declaration on Financing for Development, as they constitute an integrated international mechanism for financing development and the eradication of poverty in the world.
They provide a comprehensive approach to confronting the growing challenges facing the international community in those areas, especially in the light of the current difficult global economic and financial crisis, which has affected most countries in the world. Therefore, we stress the need to strengthen international cooperation for development, including North-South, South-South and trilateral cooperation, so as to overcome the political and financial barriers that impede the full implementation of the recommendations of the two conferences. The United Arab Emirates will continue its cooperation with the international community to achieve that goal.
The United Arab Emirates was able to deal with the global financial and economic crisis by means of precautionary financial policies and measures that enabled us to contain its aftermath as quickly as possible. We have continued to mobilize domestic
resources to implement development strategies aimed at developing human resources, operationalizing economic diversification strategies, expanding the production base and exploiting oil revenues in order to establish the infrastructure necessary to launch development in other economic sectors, all of which has contributed to continued domestic economic growth despite the global economic slowdown.
In the area of foreign investment, the Government launched initiatives and carried out policies aimed at catalysing and strengthening economic growth, completing the legal structure and combating corruption; helped to create an attractive and motivating work and investment environment; and enhanced the status of the United Arab Emirates as a safe haven for investment in the region. That has contributed to a continuing high rate of foreign investment flows to the United Arab Emirates. According to the international trade report of 2010, the United Arab Emirates was ranked at the top for the Middle East and North African regions, and sixteenth globally.
In the meantime, there has been a significant increase in the number of national companies and capital investment outside the United Arab Emirates. The United Arab Emirates is also a member of and a major contributor to a number of international partnerships developed to provide long-term development assistance to poor countries and countries affected by conflicts, including the group of Friends of Yemen, the Friends of Democratic Pakistan, the international efforts to rebuild Afghanistan, and the Contact Group on Piracy off the Coast of Somalia.
The United Arab Emirates is currently focusing on two vital areas in relation to the financing of development locally and internationally — sustainable energy and food security. Since the United Arab Emirates established its strategic role as a major provider of energy from oil and natural gas in the world, the Government has been striving to play a leading role in developing solutions for renewable energy and clean technology, with a view to prolonging investments in natural resources and securing energy to meet the continuing increase in demand resulting from the expected increase in the world’s population.
The most important investment in this field domestically has been the establishment of Masdar City in Abu Dhabi, which is planned to be a global
centre for research and the development of renewable and sustainable energy technologies. Furthermore, the United Arab Emirates is one of the main investors in sustainable energy in some European countries. It has also pledged to provide support to sustainable energy projects in small island developing States, and looks forward to further cooperation with those countries to achieve that objective in the area of renewable energy.
In regard to food security, the United Arab Emirates Government has been making steady efforts to confront the challenges posed by the fresh-water scarcity and aridity in the country. In addition to investing in water-desalination projects domestically, the Government has been leading national initiatives for the preservation of natural water resources and storage while supporting and encouraging farmers to make choices that promote the saving of water resources and the use of sustainable farming technologies.
On the other hand, the United Arab Emirates has doubled its investment in agriculture and irrigation in Arab countries and in developing countries in Asia and Africa to help them deal with food shortages and rising food prices, as well as to provide additional job opportunities.
In the area of international trade, the United Arab Emirates has entered into trade agreements with many developed and developing countries, especially in Africa. Our trade with Africa accounts for 4 per cent of the total foreign trade of the United Arab Emirates. In 2011, our foreign trade achieved 14 per cent growth. As for foreign debt, we support debt-reduction and debt-relief strategies, especially for countries emerging from conflict, to help them rebuild their economies and development.
The United Arab Emirates will continue to implement the recommendations of the Monterrey and Doha conferences so as to fulfil its national commitments and implement development strategies and programmes in the country, while also fulfilling its international commitments to help developing countries to achieve internationally agreed development goals.
I should like to start by thanking President Al-Nasser for his excellent arrangement of the fifth United Nations High-level Dialogue on Financing for Development. This year’s Dialogue is particularly meaningful and
timely given the growing urgency to renew our commitment to achieve the Millennium Development Goals (MDGs) by 2015. In order to achieve that target, we have to reinvigorate our efforts to mobilize more development resources on the one hand, and to promote the more effective and efficient use of those resources on the other. I hope that our discussions will provide useful direction to move forward to that end.
We agreed in Monterrey, and later in Doha, to mobilize financial resources for development from diverse sources. However, as noted in the Secretary- General’s report (A/66/329), we have witnessed a mixture of progress and challenge in their implementation. First, the recent downturn of government revenue in many developing countries, together with an unpromising outlook for a sustained increase in official development assistance (ODA), is of grave concern in terms of mobilizing the development potential of those countries. We hope that developing countries will exert the utmost efforts to mobilize domestic resources by adopting the measures necessary to broaden their tax base and to reinvigorate the private sector. Under such austere conditions, further efforts need to be made to combat corruption and illicit financial flows.
Secondly, while the volume of ODA provided by the Organization for Economic Cooperation and Development (OECD) Development Assistance Committee (DAC) countries hit a record high this year, after registering $129 billion last year, the outlook for a sustained increase in ODA beyond 2010 is not promising. That is especially likely considering the ongoing adverse impact of global economic and financial difficulties. Against that backdrop, the importance of fulfilling existing ODA commitments cannot be overemphasized. Furthermore, we believe that all countries in a position to do so need actively to participate in the global efforts to achieve the MDGs. For its part, the Republic of Korea is firmly committed to fulfilling its pledge to triple its ODA volume by 2015 compared with that of 2008. We recorded the second-largest increase in ODA volume among the OECD DAC countries last year.
Thirdly, the Republic of Korea welcomes efforts to mobilize diverse forms of additional resources, through new and innovative modalities such as the air- ticket solidarity levy, the International Finance Facility for Immunization, diaspora bonds, and the climate change Adaptation Fund. It is encouraging to note that
these new resource-mobilizing mechanisms are being applied to wider areas, including health, education and climate change.
We understand that the adoption of a new mechanism should always come as a result of a prudent and comprehensive review of its possible impact on each country’s financial market and regulation system. In that connection, my delegation welcomes Mexico’s plan to discuss innovative financing mechanisms for development as one of the priority areas in the forthcoming Group of 20 (G-20) summit, to be held in Los Cabos.
Fourthly, in the area of trade, my delegation shares concern over protectionist measures that persist as a reaction to global economic uncertainties. The Republic of Korea hopes that the forthcoming session of the United Nations Conference on Trade and Development, to be held in April 2012, will collectively address this concern, since protective measures will not serve any of us in the long run. In that respect, it must be noted that the G-20 leaders reaffirmed in Cannes their anti-protectionist stance. We also hope that meaningful progress towards the successful conclusion of the Doha Round will be made at the forthcoming eighth World Trade Organization Ministerial Conference, to be held in Geneva this month.
Last but not least, it is encouraging that there has recently been a strong revival in private capital flows to developing countries. In order to make the most of private capital flows for development, however, we believe that the recent experiences related to the financial crisis highlight the need to enhance international efforts aimed at mitigating the adverse impact of volatile and short-term capital flows.
Mobilizing resources in and of itself is not a final goal, but rather a means to an end. It would be meaningless if we could not produce tangible development results from hard-won resources. We should not only sustain a sufficient mobilization of resources but also continue to seek more effective ways to use them. In that regard, I should like to draw the attention of the General Assembly to the main outcomes of the fourth High-level Forum on Aid Effectiveness, held in Busan last week. The Busan meeting was held not only as an intergovernmental process but also as a multi-stakeholder forum. Representatives from more than 160 countries, 70 international organizations and
300 civil society organizations, as well as around 100 partners from the private sector, participated. The Busan Forum agreed, inter alia, to launch a new phase of global development partnership focusing on the common goals, shared principles and differential commitments collectively identified at the Forum.
I take this opportunity to outline some of the important messages that came out of that Forum. First, acknowledging the diversities of the forms, actors and modalities of development cooperation, the Forum agreed to accelerate development cooperation by adopting four shared principles: ownership of development priorities by developing countries; a focus on results; inclusive development partnerships; and transparency and accountability vis-à-vis one another. It was stressed that those shared principles would form a foundation for coherent and concerted development cooperation. They could also serve as a reference for South-South partnership.
Secondly, in the recognition that aid was only part of the solution for development, it was agreed to broaden the paradigm from aid effectiveness to development effectiveness, with a focus on sustainable development results. The Forum also recognized the importance of effective institutions and policies, the potential of South-South and triangular cooperation for sustainable development, and the role of the private sector for development. The Forum stressed the need to combat corruption and illicit flows, and called for a commitment to supporting national climate-change policy as an integral part of the overall development plans of developing countries.
Thirdly, the Forum highlighted the importance of monitoring progress against commitments and actions in a more inclusive manner. To that end, participants agreed to establish a new, inclusive and representative global partnership for effective development cooperation. The Forum invited the United Nations system to be a key contributor in the context of the successful implementation of the agreements reached in Busan at both the country and global levels. We firmly believe that the global partnership launched in Busan will complement the United Nations process for development financing in a mutually reinforcing manner.
With only four years left before the MDG target year, we are facing a growing need fully to implement the Monterrey Consensus and the Doha Declaration. In
that connection, my delegation welcomes the agreement reached during this year’s informal consultations on the General Assembly resolution on financing for development to hold informal consultations, with a view to taking a final decision on the need for a follow-up conference by 2013.
Let me conclude by reiterating the strong commitment of the Republic of Korea to constructively engage in efforts to effectively review mechanisms, and also by expressing my expectation of a mutually reinforcing and complementary process between the mechanism and the implementation of the Busan Partnership for Effective Development Cooperation.
I should like to begin by expressing our great appreciation to the President of the General Assembly for having convened the fifth High-level Dialogue on this important and very relevant theme, “The Monterrey Consensus and Doha Declaration on Financing for Development: status of implementation and tasks ahead”. I should also like to thank the respective panellists for their interesting presentations.
The international community is confronted with a wide spectrum of challenges, and the recovery of the world economy has, over the past few months, been facing serious and increasing challenges, leading to cross-cutting pressures on societies by deepening the impact on development.
The Monterrey Consensus, as reaffirmed by the follow-up Conference in Doha, is a key agreement on financing for development signalling a new partnership between developed and developing countries. Its integrated approach has been crucial to efforts to achieve the internationally agreed development goals, including the Millennium Development Goals (MDGs). Moreover, the mutual accountability compact laid down in Monterrey, extended to reflect the changing global environment, still provides a solid base to build a more comprehensive framework to address global issues.
The gap in financing for development continues to widen. Last year’s aid flow to developing countries stood at $129 billion, which is short of the official development assistance (ODA) aid target of 0.7 per cent of gross domestic product (GDP). The commitments made by the international community in Monterrey and Doha to ensure predictable development assistance, including ODA, concessional financing and
debt relief, to developing countries and supporting nationally owned development strategies, need to be fulfilled.
Efforts to identify innovative financing mechanisms that will generate additional and sustained scaled-up aid delivery to developing countries and to promote aid effectiveness need to be re-emphasized. While each country has primary responsibility for its own economic and social development and for ensuring internal conditions conducive to the mobilization of domestic savings, sustaining adequate levels of productive investment and increasing human capacity are critical to the common pursuit of growth, poverty alleviation and sustainable development.
South-South cooperation remains a vital factor for development. However, it is not a substitute but, rather, a complement to North-South cooperation. Furthermore, innovative financial mechanisms could play a part in supplementing traditional sources of financing.
Reform of the international financial architecture means strengthening the efficiency of financial markets and is at the heart of the general implementation of the financing for development process. Efforts to reform the international financial architecture therefore need to be sustained with greater transparency and with the effective participation of developing countries in decision-making processes. Coordination among the United Nations system and all other multilateral trade and development institutions must be strengthened in order to maintain macroeconomic policy coordination and complementarity of efforts in the process of financing for development.
As the world faces a multitude of pressing development challenges, Japan attaches the highest importance to achieving the Millennium Development Goals (MDGs). In order to achieve them by the target date of 2015, the global community must demonstrate clear political will and work together with all stakeholders to accelerate efforts to deliver concrete results on the ground.
In this regard, and to maintain the momentum created by last year’s High-level Plenary Meeting of the General Assembly on the Millennium Development Goals, the Government of Japan hosted the MDGs follow-up meeting in Tokyo in June this year, which was attended by many stakeholders, including 110 countries. Furthermore, during the general debate in
the General Assembly in September, Prime Minister Noda reiterated Japan’s unshakeable commitment to the MDGs, focusing in particular on health and education. That same week, Minister for Foreign Affairs Genba, together with other Member States and international organizations, hosted a ministerial-level event in which approximately 400 participants engaged in fruitful discussions about important concepts such as equity and human security, and shared useful information about the concrete methods being used on the ground to advance the process of the achievement of the MDGs.
During those meetings, we also initiated discussions on the international development agenda beyond 2015. Japan looks forward to actively making a useful contribution to the so-called post-MDGs by providing useful venues for discussions among stakeholders, as well as by participating in important discussions in various forums in the run-up to 2015.
Financing for development has long been an essential tool for attaining one of the fundamental aims of the United Nations, namely the promotion of social progress and better standards of life, in larger freedom. Therefore, even in the current global context of economic uncertainty and financial unrest, donor countries should stand firm with respect to the commitments they have made to provide assistance. At the same time, we must keep in mind that financing is not an end in itself but one of the means for realizing development. Therefore, we need to be results- oriented, paying more attention to outcomes rather than inputs and to the effective delivery of resources, to meet development needs. Because many donor countries are suffering from severe fiscal constraints, aid effectiveness that is based on the principles of national ownership, alignment, harmonization, managing for results and mutual accountability is now more critical than ever.
For those reasons, Japan welcomes the fact that official development assistance (ODA) on a global scale increased in 2010, and Japan’s ODA also increased by 11.8 per cent in 2010. Despite the challenges that Japan is facing in the wake of the great East Japan earthquake in March this year, Japan remains dedicated to faithfully implementing all international commitments, in terms of both quality and quantity, that we made before the earthquake.
Furthermore, during the general debate in the General Assembly this year, Prime Minister Noda declared that Japan would host the fifth Tokyo International Conference on African Development (TICAD-V), in 2013.
While Japan is on track in terms of delivering the pledges made at TICAD-IV, in 2008, such as doubling its ODA to Africa and assisting in the doubling of Japan’s foreign direct investment to Africa, it is focusing on how best to translate increased aid into concrete results and actual improvements in the lives of the African people.
Regarding support for developing countries in order to address climate change, Japan has already provided assistance amounting to $12.5 billion of the $15 billion pledged for fast-start finance up to next year, and it will continue to give support beyond 2012.
The responsibility for development, as the 2002 Monterrey Consensus reminds us, is shared by both developed and developing countries and by both the private and public sectors. The spirit of Monterrey is all the more important now, at a time when all stakeholders, including emerging economies, international organizations, foundations, corporations, civil society and academia, must work in partnership towards development through sustained, inclusive and equitable economic growth.
In that regard, South-South and triangular cooperation has been seen as an indispensable means of international development cooperation. Japan has actively engaged in triangular cooperation and now maintains partnership programmes with 12 developing countries. Japan’s history of foreign assistance began in 1954, when it was still an aid recipient itself. That fact shows why South-South cooperation has profound significance for Japan. The rhetorical difference between solidarity and aid effectiveness should not prevent us from moving forward with concrete actions on South-South and triangular cooperation.
To introduce just one concrete example, Japan has contributed to the transformation of Brazil’s savannah region, the Cerrado, into a major agricultural area. Based on that experience, Japan, Brazil and Mozambique are now promoting agricultural development in the tropical savannah region of Mozambique.
Furthermore, in order to facilitate the fruitful interactions of all stakeholders in development cooperation, the Busan Partnership for Effective Development Cooperation, which was adopted at the Fourth High-Level Forum on Aid Effectiveness last week, established a framework for development cooperation that embraces traditional donors, emerging economies, the private sector, including civil society, private-sector foundations and other actors.
We welcome the agreement at Busan on a common set of principles that underpin all forms of development cooperation. My delegation firmly believes that this historic agreement should be embedded in the discussions we have at the United Nations.
Finally, with regard to development assistance, in order to mobilize a wide range of resources to meet the demand for global development, innovative sources of development finance have been significantly complementing and adding to the traditional sources. Japan hopes that the international debate on innovative financing can be further enhanced and that such modalities can be used to contribute to the achievement of the MDGs and other international development goals.
I should also like to touch upon other major areas of the Monterrey Consensus. The expansion of trade is a strong engine for development. Japan has therefore been active in enhancing measures related to aid for trade since the 2005 Hong Kong Ministerial Conference, including trade-related ODA, which amounts to $22 billion at commitment base. Regardless of the impasse confronting the Doha development agenda, we should also approach the forthcoming World Trade Organization Ministerial Conference, and the negotiations beyond it, with a view to fresh thinking and determination to begin exploring fresh and credible approaches.
We need to remain vigilant on the issue of sustainable debt management in order to achieve national development goals. At the same time, we should bear in mind that the Doha Declaration called for all creditors to contribute their fair share and become involved in the international debt-resolution mechanisms.
While Japan welcomes the recent reform in international financial institutions to improve their lending facilities in response to the world financial and
economic crisis, we also acknowledge the need to further reform their governance.
In conclusion, allow me to express the hope that the discussions at this High-level Dialogue will provide a valuable input to the upcoming important meetings, including United Nations Conference on Sustainable Development and the Development Cooperation Forum in 2012.
Thank you, Sir, for giving me an opportunity to speak in this important debate.
My delegation associates itself with the statement delivered at the 77th meeting by the representative of Argentina on behalf of the Group of 77 and China.
First, it gives me pleasure to acknowledge the progress achieved so far in the application and implementation of the decisions of the Monterrey Consensus, adopted by the International Conference on Financing for Development, held in Mexico in March 2002, and the Doha Declaration, adopted by the first Follow-up International Conference on Financing for Development to Review the Implementation of the Monterrey Consensus, held in Qatar in November and December 2008. It is also my pleasure to acknowledge the efforts made by developed and developing countries alike to faithfully implement the decisions of the Conference or to undertake constructive initiatives in support of their implementation. Such efforts acquired special momentum in the context of the international community’s pursuit of the Millennium Development Goals (MDGs).
In that regard, I highly commend the unrelenting efforts of the majority of developing countries to embrace the concept of good governance in all political and economic fields, against a backdrop of fast-paced domestic and regional changes and challenges. I also appreciate the initiatives of the Group of 20, but I hope those initiatives will not overshadow the primary role of the United Nations or compromise the right of all States to participate in decision-making mechanisms at the international level.
In that context, I would be remiss if I failed to commend the initiative to combat hunger and poverty and pay tribute to the countries that sponsored it. The International Conference on Financing for Development was a watershed in international development cooperation. The special formula under
which it was convened made it a landmark conference unique among other United Nations international conferences. The participation by kings and heads of State and Government reflected the sincere political will of the international community at the highest level to deal seriously with issues relevant to financing for development. The participation by the International Monetary Fund, the World Bank and the World Trade Organization, in addition to stakeholders from the business community and representatives of civil society, on an equal footing with the United Nations in the preparatory process and activities of the Conference gave it a special importance.
That constructive participation gave the Conference a pragmatic character, which the world sorely needs in order to face up to the challenges of globalization. It helped to move the process of international cooperation to finance development away from the arena of futile challenge and confrontation into the sphere of constructive engagement.
There is little doubt that the challenges that we face today are far more daunting than anyone could have imagined when the Monterrey Conference concluded its work in 2002. Today the world seems to be witnessing new and unexpected challenges that are wreaking havoc with the peace and economic security of the citizens of the world.
The scope of the financial and economic crisis and the speed with which it spread took the world’s most experienced specialists by surprise. What started as a financial malfunction that was relatively under control in the world’s largest industrial economy picked up speed and became a crisis of global proportions. Its ramifications spread, ushering in the worst financial and economic crisis the world has seen since the Second World War or even since the 1930s.
It is true that recently there have been signs indicating that the crisis may be relenting by the end of the year, but the world continues to face risks. While there has been a slight recovery since 2010, the spectre of a downturn still looms. Developing countries suffered far more than their developed counterparts.
The global financial crisis demonstrated the significance of weathering this international predicament through concerted efforts in order to preserve the gains that were achieved in the realization of the international development goals, including the MDGs.
Qatar’s hosting of the Follow-up Conference on the Monterrey Consensus in 2008 was well timed. The issues that were relevant then are still on the table today and must be duly addressed. There is an opportunity to take the necessary measures to protect those who cannot alone bear the brunt of adapting to developments. We are called upon to recognize the important correlation between financing for development and support for trade. We must resist the temptation of defending our domestic economies through State trade protectionism.
This session of the General Assembly, and this High-level Dialogue, must produce a renewed commitment to fulfil the development dimension of the Doha Round. Furthermore, we must reaffirm and promote the global partnership for development that was conceived and consecrated in Monterrey and further confirmed in our Doha commitments. Those commitments called for maintaining the required financial flows in order to spare least developed countries the larger share of the burden of the financial crisis. A world recession could well lead to huge increases in the rates of poverty, and therefore the suffering of the world’s poor.
We must reiterate our commitment to official development assistance and fulfil the promises we made in that regard. We must increase financial support to ward off a possible erosion in the MDG achievements that were on track. That is particularly important in view of the fact that only four years separate us from the target date for the realization of the MDGs.
This is a historic opportunity that could allow us to chart the course of a new trade, financial and economic order. We should not stop at a reaffirmation of the lessons learned from the crisis and a commitment not to allow its recurrence. Our objectives must reflect the changing face of the current global economic scene, which emerged after the convening of the Bretton Woods Conference on the world’s monetary and financial systems. We must build a new, just and equitable world order that supports the efforts of developing countries and gives them an adequate and appropriate voice and representation. The regime that was built at Bretton Woods was not capable of adapting to the economic and political changes that have emerged in the past decades.
The United Nations has been the proper forum for the establishment of the current international financial structure. It remains today the appropriate context within which to maintain that structure. It is therefore only natural that the reform of the financial system should also take place under its aegis.
I should like to point out that the State of Qatar has honoured its commitment to allocate 0.7 per cent of its net national income for official development assistance. Acting upon an initiative by His Highness the Emir of Qatar, Hamad bin Khalifa Al-Thani, we established the South-South Fund for Development, to which His Highness pledged $20 million. Qatar also provides additional development assistance through various United Nations funds and programmes, as well as through bilateral aid programmes and humanitarian assistance, including emergency and natural disaster assistance.
Successful development is directly linked to an increased level of development for our financial and trade partners. We therefore need to promote mutual support for each other. It is not possible for any State to write its success story alone without guaranteeing the success of others. Our economic peace and security depend on the success of multilateral negotiations and on introducing proposals and solutions that are mutually beneficial to all.
As we continue our important discussions on financing for development, we must ensure that our deliberations reflect the dramatic shifts in the development landscape. Official development assistance (ODA) from Governments and multilateral organizations is no longer the primary driver of economic growth. In the 1960s official development assistance accounted for 70 per cent of capital flows to developing countries. Today, because of private-sector growth, increased trade, domestic resources, remittances and capital flows, ODA accounts for only 13 per cent of financial flows to developing countries, even as development budgets have continued to increase.
As the Secretary-General’s financing for development report (A/66/334) highlights, developing countries are now a critical driver of international economic growth and have themselves become a source of development finance. Developing countries now account for 30 per cent of outward foreign direct investment. That is double their share just three years
ago. Over the same period, developing countries’ share of global trade has increased from one third to more than 40 per cent. Developing countries account for three of the top five trading partners for the least developed countries.
The changes we have seen in development mean that old distinctions like “donor” and “recipient” are less relevant. At last week’s High-Level Forum on Aid Effectiveness in Busan, Secretary Clinton said:
“We need every provider of assistance at the table, emerging and traditional, public and private. And we need to make sure we get past the old divisions so we can deliver results for everyone.”
Official development assistance remains an important component of financing for development and, when well-targeted, can play an important role in reducing extreme poverty and can serve as a catalyst for self-sustaining development. But we must also recognize that any serious discussion of ODA needs to focus on the quality of assistance — what it actually achieves — and not just on quantity.
As we look to Paris, Accra and Busan, it is more important than ever for us all to embrace and implement the five fundamental principles of national ownership, alignment, harmonization, managing for results, and mutual accountability.
The fact that private sector flows, including capital flows, trade and remittances, are the bulk of development financing today is a positive step forward. However, it underscores the importance of continuing to shift our approach and our thinking from aid to investments — investments targeted to produce tangible results. Investors choose their investments carefully, making it essential for Governments to create and maintain stable, rules-based domestic environments that support growth and that guarantee fair treatment.
Sustainable and inclusive economic growth requires Governments to pursue and maintain the highest standards for accountability and transparency and to continue to fight corruption and illicit financial flows. We have seen from numerous positive examples around the world that Governments in developing countries can accelerate investment in growth by providing their citizens with improved access to the facilities of economic opportunity. In some countries
that still requires significant reforms to remove barriers to education, land ownership and lending and to create legal systems in which people are treated equally.
In conclusion, the dramatic changes in the global economy in recent decades, and in particular the trends that we have seen in development finance since we met in Doha in 2008, require us to take a collective fresh look at the financing-for-development process to ensure its continued relevance. That includes the need to break down the outdated donor/recipient model and broaden the financing-for-development framework in order to recognize the growing participation of new and non-traditional players in development finance, a new focus on investment over aid, the full incorporation of the five aid-effectiveness principles, and continuing efforts to help developing countries make the necessary reforms to spur inclusive, equitable economic growth and to achieve the Millennium Development Goals.
Russia welcomes the holding of the High-level Dialogue on Financing for Development, which we continue to consider to be a central intergovernmental mechanism under the United Nations for the coordination of follow-up activities on the outcomes of the Monterrey and Doha Conferences.
Dialogue is an important platform for interactive discussion, with the participation of all key players in the Monterrey process in the comprehensive efforts to effectively use financial resources for development. One of the priorities of the High-level Dialogue is to foster constructive cooperation between the United Nations and prominent financial and trade institutions under their respective mandates.
We consider this Dialogue to be another excellent opportunity to review the outcome of the United Nations Millennium Development Goals Summit, the fourth United Nations Conference on the Least Developed Countries, the High-Level Forum on Aid Effectiveness and other major international events in the context of the Monterrey agenda.
We believe that the High-level Dialogue could make an important contribution to the success of the Conference on Sustainable Development to be held in Rio de Janeiro, as well as to the General Assembly’s forthcoming work on the issue of strengthening the role of the United Nations in the global governance system.
Russia reiterates its commitment to the fundamental principles of global partnership for development set out in the Millennium Declaration (resolution 55/2) and crystallized in the decisions of the Monterrey and Doha Conferences.
At the height of the financial and economic crisis, Russia significantly increased its official development assistance (ODA) to needy countries in the Commonwealth of Independent States, including within the framework of the Eurasian Economic Community. Our country initiated the establishment of a new mechanism for providing assistance in crisis conditions — the EurAsEC Anti-Crisis Fund, totalling $10 billion, $7.5 billion of which were contributed by Russia.
In 2010, aggregate aid levels provided by Russia categorized as ODA, without taking into account debt write-off, exceeded $470 million, which is in line with the guidelines and indicators defined in the concept of Russia’s participation in assistance to international development adopted by the President of the Russian Federation.
Current activities, including with regard to official development assistance, play an important role as catalysts in national efforts to ensure sustainable, comprehensive and equitable growth. For many developing countries, in particular the most vulnerable, ODA is still a fundamental source of funding.
Nevertheless, internal resources have always been, and continue to be, more stable sources of financing for development. In that connection, we call for according priority to ensuring macroeconomic and financial stability, strengthening national systems of tax collection and the tax base, combating corruption and illegal capital flows, fostering the potential of the private sector, and resolving problems associated with a the incomplete and ineffective use of the available resources.
In line with the spirit of Monterrey, we agree on the need to focus on joint efforts in the search for new sources of financing for development. Of the utmost importance in that regard is to carefully follow the principles agreed at the United Nations, including that the participation of countries in innovative financing mechanisms must be conducted solely on a voluntary basis and that the mechanisms themselves must supplement, and not substitute for, traditional forms of mobilization of financial resources.
An important factor in the successful introduction of any innovative financing for development mechanism is an appropriate analysis of the differing capacities of recipient countries to effectively use resources that they have helped to mobilize. In our view, the greatest practical return would be progress in establishing a mechanism to pool financial resources from different sources, which in the near future would permit an increase in the flexibility and effectiveness of the whole system of financing for development without making any fundamental changes to it.
The Secretary- General’s report on innovative mechanisms of financing for development (A/66/334) underlines that new resources are needed to complement traditional official development assistance (ODA), in particular in the areas of health, climate change and the environment. In that context, the Liechtenstein Government agreed in January 2010 to the principles of the Copenhagen Accord as a guideline for the development of a successor protocol to Kyoto. Consequently, the Liechtenstein Parliament, in November 2010, agreed to additional climate seed- funding for the years 2011 and 2012. That additional contribution complements Liechtenstein’s ODA and will support measures for combating and adjusting to damaging climate effects in developing countries.
In addition to additional or complementary resources, the achievement of the ODA target of 0.7 per cent must remain at the centre of our efforts. International humanitarian cooperation and development is a central pillar of Liechtenstein’s foreign policy. The Liechtenstein Government has repeatedly underscored its commitment to achieving the 0.7 per cent target by 2015. According to gross national income estimates, it appears that Liechtenstein achieved 0.6 per cent ODA in 2010.
We are committed to using what are, in absolute terms, modest resources to make a concrete and visible contribution to sustainable development. Our policy is focused on regions that are neglected or forgotten and on areas in which Liechtenstein has special expertise. Liechtenstein’s international development cooperation policy has had a special focus on least developed countries throughout the Millennium Development Goals campaign. In 2010 we surpassed the internationally agreed development goal to allocate 0.2 per cent of gross national income for ODA to least developed countries.
The Government of Liechtenstein has committed itself to implementing internationally recognized standards of transparency and exchange of information with the Liechtenstein Declaration of 2009. Through the Declaration, we reaffirmed our commitment to international cooperation on tax matters on the basis of internationally agreed standards. We also concluded numerous tax information exchange agreements and double taxation agreements. We are determined to continue to engage with our partners worldwide in that respect.
We would like to point out the importance of transparency in international regulation processes as an indispensable element for the equal participation of all States and for the implementation of the principle of a level playing field. In our view, tax information exchange agreements, in particular double taxation agreements, are instruments that strengthen economic cooperation between two States, from which both countries can mutually benefit.
Illicit financial outflows are one of the greatest obstacles to development. In our view, building capacity to effectively fight corruption, money- laundering and illicit financial outflows, on the one side, and measures to promote good governance, on the other, have great potential within innovative mechanisms of financing for development. Liechtenstein supports measures for promoting good governance, such as the Anti-Corruption Programme of the United Nations Development Programme.
We also closely cooperate with the Global Programme against Money-Laundering. In addition to financial contributions, we have made expertise directly available to this and other programmes, as both our Financial Intelligence Unit and the Office of the Public Prosecutor have participated many times as experts in relevant training programmes for developing countries.
Liechtenstein also provides financial support to the Basel Institute on Governance, a non-governmental organization that is a pioneer in its field, in particular through its International Centre for Asset Recovery. The Centre offers training and capacity-building for developing countries in their efforts to recover stolen assets.
Liechtenstein remains committed to the achievement of the international ODA target.
Additionally, we remain open for new and additional resource channels to complement traditional ODA.
We welcome this High-level Dialogue to consider our shared promises to the world’s poor. Since the last such meeting, the Millennium Development Goals Summit and the Conference on the Least Developed Countries in Istanbul reaffirmed those promises and provided new impetus to continue to push towards achieving the Millennium Development Goals (MDGs). That momentum must continue as the clock ticks towards 2015.
Along with the United States Agency for International Development, the United Kingdom’s Secretary of State for International Development hosted a side event at the margins of the opening of this session of the General Assembly that brought together development leaders and practitioners to celebrate MDG success stories. The event sought to demonstrate that progress was possible through innovation and transformational ways of working.
We are keen to engage with all partners in a discussion on objectives and priorities for development assistance beyond 2015, but our immediate priority must be the implementation and achievement of the current MDGs. It is clear that they will not be achieved without adequate financing for development. Our commitment to the Monterrey Consensus as a whole — including mobilizing and increasing the effective use of financial resources, foreign direct investment, private flows, trade and debt relief — is key to making significant progress on the MDGs.
We believe the most effective way to alleviate poverty is through sustained economic growth. The private sector is the engine of growth — creating jobs, increasing trade, providing goods and services to the poor and generating tax revenue to fund public services such as health and education. The United Kingdom’s Department for International Development is working with the private sector to promote responsible and successful business and to push the boundaries of business models to generate profits and have a strong developmental impact.
Trade is another vital stimulus for growth that has a direct impact on poverty alleviation. The United Kingdom has championed trade in the Group of 20, where we co-chaired the trade pillar of the Development Working Group. We continue actively to
support provisions of 100 per cent duty- and quota-free market access for least developed countries.
We are disappointed by the lack of progress on the Doha Round. It is crucial that we find a way forward to advance trade negotiations and strengthen the multilateral trading system. But while we are taking a holistic approach to financing for development, we should be clear that meeting existing commitments to provide official development assistance (ODA) is one of the key pillars in our efforts. The United Kingdom Government is meeting its aid targets and is committed to spending 0.7 per cent of its gross national income on aid by 2013. We are also enshrining that commitment in our national legislation.
The United Kingdom is also a strong supporter of innovative financing for development, and has helped to drive progress in this area. Where innovative financing has worked well, it has helped to deliver additional resources and to use them effectively. For example, the International Finance Facility for Immunization has helped the Global Alliance for Vaccines and Immunization to raise more donor support and use those funds efficiently to finance lifesaving vaccines for children in developing countries. However, innovative finance is not a substitute for ODA, but a means of extending and maximizing the impact of ODA.
At the same time, we must make aid more effective by strengthening our focus on results, transparency and accountability. The United Nations must continue to strengthen its systems to adhere to the principles of transparency and ensure effective delivery of results on the ground. We welcome the outcome of the Busan High-Level Forum on Aid Effectiveness and look forward to the 2012 United Nations Development Cooperation Forum as a platform for greater accountability between donors and partner countries on aid effectiveness.
Italy welcomes this opportunity to continue the United Nations membership’s dialogue on the crucial issue of financing for development. We fully subscribe to the statement made by the European Union but would like to add some remarks in a national capacity.
The Monterrey Consensus, as reaffirmed and integrated by the Doha Declaration, remains a landmark agreement today, almost 10 years after its adoption and despite major international changes. It
lays the foundation for a global partnership to achieve the internationally agreed development goals, including the Millennium Development Goals (MDGs).
The actions of the international community should continue to be inspired by its underlying philosophy, whose validity is unchanged. Financing for development must be considered in a comprehensive and holistic manner that takes into consideration the full range of available sources, domestic and external, public and private, traditional and innovative. At the same time, we must continue to address systemic issues that can impact development — such as the coherence and effectiveness of the international monetary, financial and trading systems — while acknowledging the progress that we have made.
Furthermore, proper attention must be paid to other development factors such as good governance, the rule of law, human rights, gender equality and environmental sustainability. While those factors do not have direct financial implications, they can free up additional internal resources and generate positive returns for development. The real challenge is to ensure that all those components interact in an integrated, harmonized and mutually effective way, thereby multiplying the development benefits.
The other, equally important side of the coin is aid and development effectiveness. That is why Italy welcomes the new, inclusive and representative global Partnership for Effective Development Cooperation launched a few days ago in Busan, Republic of Korea. Shared principles, common goals and differential commitments are a good basis for maximizing synergies among international actors, including emerging economies. We also welcome the greater emphasis placed on country-level implementation, which should allow the United Nations to play a more direct role by using its consolidated presence in the field.
In today’s global economic and financial climate, Italy is experiencing a particularly challenging situation that is significantly reducing its fiscal capacity. This week, the new Government adopted a package of important economic and budgetary measures. That is solid proof of Italy’s determination to redress the situation with the support of an exceptionally large parliamentary majority. We are determined, as soon as conditions allow, to return to
the level of development cooperation that was originally planned.
Despite the difficulties it faces, Italy remains engaged on various development fronts, basing its national strategy on the principles of aid effectiveness, a holistic vision of development, a whole-of-country approach, and special attention to the least developed and most vulnerable countries. Food security remains a high political priority for Italy. We continue to financially support the process initiated during our Group of Eight (G-8) presidency with the L’Aquila Food Security Initiative, later endorsed by the Food and Agriculture Organization World Food Summit in November 2009 and adopted as the Rome Principles. We continue to support efforts towards a new, more effective governance structure in global food security and have contributed to the initiatives of the Group of Twenty (G-20) to address excessive food price volatility.
On the issue of external debt, as a recent World Bank and International Monetary Fund report indicated, over the past 10 years Italy has concluded 57 bilateral agreements with heavily indebted poor countries for a total debt cancellation of $3.9 billion. On innovative financing — which is not a substitute but certainly an increasingly important supplement to traditional sources of financing — Italy continues to play a leading role in two successful health-sector initiatives: the advance market commitments, where we are the first donor, with $635 million; and the International Finance Facility for Immunization, where we are among the main donors, with $473 million.
Italy is also particularly committed to international action aimed at reducing the costs of transferring migrant remittances being promoted within the framework of the G-8, the G-20, the World Bank and the Leading Group on Innovative Financing for Development. We are open to constructively considering other sources of innovative financing that are currently being discussed within the European Union and in the larger international context.
I wish to conclude by reaffirming Italy’s full adhesion to the principles and provisions of the Monterrey Consensus and the Doha Declaration. I express the hope that we can all work together successfully to further strengthen our global development partnership for 2015 and beyond.
Malaysia would like to associate itself with the statement delivered by the representative of Argentina on behalf of the Group of 77 and China and by the representative of Indonesia on behalf of the Association of Southeast Asian Nations.
My delegation wishes to express its appreciation to President Al-Nasser for having convened the fifth High-level Dialogue on Financing for Development. The convening of this Dialogue is timely, and the theme chosen, “The Monterrey Consensus and Doha Declaration on Financing for Development: status of implementation and tasks ahead”, is most appropriate. The Dialogue is pertinent given the ongoing financial crisis and the uncertain global economic outlook that has adversely affected development, in particular in the developing countries. For that reason, my delegation wishes to remain engaged in this discussion.
The mobilization of domestic resources remains the primary source of financing for development. Developing countries, in particular the least developed economies, require that the right policies be in place to capitalize fully on the potential of domestic resources. At the same time, there is also a need to continue to undertake fiscal reform, including broadening the tax base, reforming the tax administration and enhancing the capacity to combat tax evasion. While every country has its own tax regime, it is also pertinent for countries to enhance international cooperation to support national initiatives to improve their tax regime.
Malaysia welcomes the greater mobilization of international resources, with a strong revival in private capital flows, as highlighted in the Secretary-General’s report (A/66/334). We are also encouraged by the fact that there are signs of greater diversification of foreign direct investment and other private flows to the developing countries, in particular the high investment inflow in Africa, compared with a decade ago. Despite this positive development, we remain wary of the uneven distribution of foreign direct investment among the least developed countries, with more than 80 per cent of the capital poured into resource-rich economies in Africa. To address that imbalance, there is a need to re-energize the provision of export credits and other lending instruments, risk guarantees and business development services to those disadvantaged countries.
Malaysia, as a trading nation, firmly believes that international trade can play a vital role in promoting growth and development. For those reasons, Malaysia
is encouraged by the Secretary-General’s positive projection regarding global trade growth of about 7 per cent in both 2011 and 2012. However, we are concerned that the growth prospect for the short-term outlook has been clouded by a number of significant risk factors, including the rise in protectionist measures taken by some countries.
In that regard, Malaysia reaffirms its commitment to uphold a universal, rules-based, open, non-discriminatory and equitable multilateral trading system that could contribute to growth and sustainable development. We reiterate our call on all countries to resist tendencies to turn inwards in times of economic difficulty, as this has great negative repercussions, particularly for the developing countries. Malaysia therefore calls on the World Trade Organization and other relevant bodies, including the United Nations Conference on Trade and Development, to continue monitoring protectionist policies and to assess their impact on developing countries. We also urge developed countries to exercise the flexibility and political will necessary to break the current impasse in the negotiations, in order to address the needs and concerns of developing countries.
Malaysia considers that Aid for Trade, which aims to enhance developing countries’ trade capacity and international competitiveness, should only complement and not be a substitute for the Doha Round or for the outcome of any other trade negotiations. While Malaysia appreciates the fact that the recent increase in aid for trade was directed to the least developed countries, we are also concerned that the distribution of aid for trade is confined to only 10 least developed countries. We therefore call for development partners to implement effective trade- related technical assistance and capacity-building on a priority basis, as agreed at the Fourth United Nations Conference on the Least Developed Countries, held in Istanbul.
Malaysia is encouraged that, as noted in the report of the Secretary-General, debt indicators improved in many developing countries in 2010. That is a welcome sign for those countries as they continue to strive to improve their economic performance. However, the improvement in the debt situation is uneven across regions, with 20 countries remaining at high risk or already in distress. At the same time, the spillover effects of the European debt crisis and other risk factors could also significantly affect the outlook
for debt sustainability in many developing countries and emerging economies. In that regard, Malaysia welcomes the Secretary-General’s suggestion to enhance the financial architecture for debt restructuring, which is to be discussed at the United Nations taking into account its impact on the achievement of the Millennium Development Goals.
The ongoing financial crisis has clearly revealed weaknesses in global economic governance. While we are encouraged by the reform efforts within multilateral financial bodies that have helped to rebalance decision-making powers in the Bretton Woods institutions, there is a need for greater transparency and increasing participation by developing countries in the reform process. It is in the framework of addressing systemic issues that we would like to reiterate our call for all stakeholders to intensify their efforts to prevent any further deterioration of the financial system and to restore confidence in the global economic governance.
The Secretary-General’s report reflects the fact that despite increased aid flows to the developing countries, the contributions of many larger donors remain below the United Nations target of 0.7 per cent of their gross national income. Traditional donors have also failed to deliver on their commitments to the least developed countries, where the level of official development assistance (ODA) is still well below the target of 0.15 to 0.20 per cent of their gross national income by 2015. Malaysia therefore urges those developed countries to fulfil their ODA commitments in line with the calls made at the High-level Plenary Meeting of the General Assembly on the Millennium Development Goals, held from 20 to 22 September 2010, and in the Istanbul Programme of Action for the Least Developed Countries for the Decade 2011-2020 (A/CONF.219/3).
Malaysia supports the ongoing efforts to identify new and innovative sources of development financing so as to mobilize additional resources on a stable, predictable and voluntary basis for developing countries. However, we would like to stress that such funds should complement and not be a substitute for ODA and should be disbursed in accordance with the priorities of developing countries.
Malaysia acknowledges the importance of human capital development as an impetus towards growth and development. For that reason, it is committed to
continue to learn from and share knowledge with fellow developing countries, in particular in the area of technical cooperation for development, which remains a key element of the Monterrey Consensus. Within the context of South-South cooperation, the Malaysian technical cooperation programme is a vehicle for sharing the country’s development experience and strengths in that respect. To date, more than 20,000 participants from 138 countries have benefited from the programme.
Malaysia also promotes South-South cooperation at the enterprise level through the proactive efforts of two private-sector-initiated, investment-oriented South- South bodies, namely the Malaysia South-South Association and the Malaysian South-South Corporation. Those two bodies have undertaken various initiatives to promote economic and trade relations between Malaysia and other developing countries.
Malaysia underlines the importance of the United Nations playing a central role in dealing with development issues and the implementation of the commitments made at Monterrey and Doha. In that regard, Malaysia stands ready to work with President Al-Nasser and other delegations to ensure a successful outcome of the High-level Dialogue on Financing for Development.
I have the honour to speak on behalf of the member States of the Caribbean Community (CARICOM) that are members of the United Nations, namely, Antigua and Barbuda, the Bahamas, Barbados, Belize, Dominica, Grenada, Guyana, Haiti, Jamaica, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Suriname, and Trinidad and Tobago. CARICOM wishes to be associated with the statement delivered earlier by the representative of Argentina on behalf of the Group of 77 and China.
Allow me to acknowledge the invaluable work done to date by the President of the General Assembly at its sixty-sixth session. My delegation welcomes the convening of this fifth High-level Dialogue on Financing for Development, as it provides us with another opportunity to examine the development cooperation landscape and highlight those challenges that must be addressed if developing countries are truly to move towards the achievement of the internationally agreed development goals, particularly the Millennium Development Goals (MDGs).
The Dialogue in which we are engaged cannot be undertaken without reference to the world financial and economic crisis that has continued to evolve and left both developed and developing countries beset by a range of economic and social challenges, and placed small and vulnerable countries in particular in a precarious position.
The persistence of the financial and economic crisis in its various permutations has significantly undermined the ability of developing countries to achieve the internationally agreed development goals, including the Millennium Development Goals, over the long term. Indeed, there can be no doubt that progress towards the achievement of the MDGs has slowed as a result of the world financial and economic crisis, global commodity price volatility and the food crisis, which is particularly acute in the Horn of Africa and which has eroded some of the gains that had been made towards the eradication of poverty.
The crisis has also had adverse effects on the flow of foreign direct investment, international trade volumes and the level of indebtedness of developing countries, all of which have had knock-on effects on the availability of domestic and international financing for development.
Against that backdrop, it is imperative that we engage in frank discussions on development cooperation, and on financing for development in particular. It is also important that we remain cognizant of the strong linkages between the commitments that have been undertaken in the context of the process of financing for development and our commitments in the framework of the MDGs, particularly those embodied in Goal 8 — the global partnership for development. Those exchanges are integral to determining how we can best collaborate as we seek to manoeuvre in a very challenging international political and economic environment.
In that regard, we must acknowledge the efforts that have been made by some development partners to achieve, and in some instances exceed, the target of 0.7 per cent of gross national income to official development assistance (ODA), despite the ongoing economic and financial crisis. That is indeed commendable. However, we remain concerned that many others have not made good on their commitments.
The premise of the Monterrey Consensus, which was further advanced in the Doha Declaration, is that the challenges we face in securing financing for development require a global commitment and a response rooted in a new partnership among developed and developing countries, and with the multilateral financial institutions. It is further predicated on the fact that each country has the primary responsibility for its own economic and social development.
We must therefore go beyond meetings and discussions and endeavour to find the political will to act on our commitments and in keeping with our respective capabilities and responsibilities, so that we will be in a better position to ensure that the majority of developing countries are able to achieve the MDGs and, furthermore, to create a post-2015 development framework that addresses development in all its dimensions.
A key development challenge faced by CARICOM member States — which are primarily small, vulnerable middle-income countries — is the onerous nature of the ratio of our debt to gross domestic product. For many of our member States, that ratio now stands at more than 100 per cent, which has reduced our fiscal space and will likely inhibit our ability to attain some of the development goals.
Quite frequently, it is the most vulnerable citizens who are negatively affected by such limitations and whose needs go unmet. For that reason, we will continue to insist that the international community, including the United Nations development system and the international financial institutions, must take a more systematic approach to addressing the development needs of developing countries that are categorized as middle-income countries, with the aim of providing them with increased access to concessionary financing. Such an approach — which would include the provision of debt relief and the disbursement of grants and loans on concessionary terms that are not currently available to middle-income countries — would serve to alleviate the precarious economic situation in which many small, vulnerable, highly indebted middle-income countries have found themselves. It would also forestall the further erosion of the development gains that we have made to date.
I turn now to international trade, which has a central role to play in improving the development prospects of developing countries and in increasing our
capacity to mobilize domestic financial resources for development. However, so far we have failed to conclude the Doha Round of negotiations, which we began 10 years ago and which entails an explicit commitment to address development issues head on. The idea of a global partnership extends to the multilateral trading system. If our frequent assertions that we are committed to development are to be more than hollow utterances, it is imperative that we take the steps that are necessary to allow for the conclusion of the World Trade Organization (WTO) Doha Round.
The eighth Ministerial Conference of the WTO, which will take place from 15 to 17 December, will provide yet another opportunity to go beyond statements and to move closer to the creation of a fair, equitable, comprehensive and effective rules-based international trading system. Let us try to make the most of it.
We acknowledge that in our efforts to mobilize international resources for development — particularly in a context where increased budgetary pressure in developed economies is leading to a reduction in traditional official development assistance — it is imperative that we adopt new and innovative approaches. However, while we support those efforts to find means of increasing the resources available for development financing, we feel compelled to note that some of those mechanisms have unintended adverse effects on the economic prospects of small developing economies. Despite the noble uses to which the funds are put, the tourism-dependent islands of the Caribbean, for instance, have been negatively affected by the imposition of increased airport passenger duties on passengers travelling to the region from Europe and other key points.
Our aim in raising concerns about innovative sources of financing is not to question this ostensibly laudable approach to securing additional resources for development, but rather to draw attention to the fact that some of those mechanisms may have unintended, although consequential, negative effects on developing economies, including our own. We must find means to ensure that those innovative approaches do not harm those whom they are intended to help. Furthermore, we hope that any approach will take account of aspects such as additionality, the relationship of innovative finance to ODA, and effectiveness.
Central to addressing international financial systemic and institutional issues is the enhancement of our financing-for-development follow-up and implementation mechanisms. CARICOM sees that as a necessary step towards a more comprehensive and coherent approach to crucial development issues, as well as towards greater openness, transparency and inclusiveness in global norm-setting and economic decision-making. In that connection, CARICOM has been particularly active with respect to institutional arrangements for the implementation of international cooperation in tax matters. CARICOM believes that there is an urgent need for an intergovernmental body that is inclusive and participatory and in which broad- based, development-oriented dialogue on international tax issues could be considered and, indeed, agreed.
CARICOM therefore will continue its collaboration with partners in working on a resolution for the upgrading of the Committee of Experts on International Cooperation in Tax Matters to an intergovernmental body of the Economic and Social Council with a view to strengthening international cooperation in tax matters, as called for in the Doha Declaration.
The achievement of the internationally agreed development goals, including the MDGs, will depend on global partnership and the fulfilment of commitments made in respect of official development assistance, as well as on South-South and triangular cooperation as a complement to, but never a substitute for, traditional ODA. It will also require the fulfilment of commitments to provide financing for climate change adaptation, particularly for small island developing States and other countries that are acutely vulnerable to the adverse impacts of climate change. It will also require renewed commitment to multilateralism and, to that end, increased efforts to reform the international financial and economic architecture, including through increased representation of developing countries in the decision- making processes of the international financial institutions.
Our failure to find the political will to take bold steps will ensure that the challenges we face will multiply and that development will remain the province of a few and an aspiration of the many. We must take the bold steps necessary to ensure the achievement of the internationally agreed development
goals, including the MDGs, and whatever post-2015 framework we agree upon.
Switzerland reaffirms its support for the Monterrey Consensus and the Doha Declaration on Financing for Development.
In the context of a financial crisis that is increasingly limiting traditional financing mechanisms, new ways should be explored to improve access to finance for developing countries. At the same time, our commitment to poverty eradication, the reduction of inequalities and the provision of solutions to global challenges should not be set aside. Despite the crisis, donors should strive to maintain their official development assistance (ODA) commitments and budgets with all partners and to share the burden of this collective effort.
The financial crisis has also highlighted the need for better regulation and supervision of the financial system. Global economic governance requires open and transparent coordination of the work of the Group of Twenty, the international financial institutions and the United Nations. The United Nations funds and specialized agencies, in accordance with their mandates and comparative advantages, have an important role to play in contributing to this process. Switzerland will continue to promote actions for a strong, well-coordinated, consistent and efficient United Nations system for this purpose.
Let me underline some issues that Switzerland believes to be at the heart of the discussion today. First, while financial flows are relevant to development processes, the particular role and significance of each flow differs considerably from country to country. Foreign direct investment and trade may be the crucial flows in some countries, for example, while ODA and debt relief may be more important in others. Improved coherence and effectiveness require not only global principles and actions, but also specific country-level development strategies. There is no one-size-fits-all solution.
Secondly, greater domestic resource mobilization must be achieved. Each country has primary responsibility for its own economic and social development. Developing countries must be able to manage their environment and natural resources in a sustainable manner in order to raise sufficient revenue to ensure provision of basic public services and to
reduce dependence on external aid. Attention should be paid to the links between domestic and international financial flows and to the promotion of an enabling international economic environment. Switzerland will continue to support developing countries in their efforts to create effective tax systems.
Switzerland also recognizes that illicit asset flows remain a major impediment to development. Constant efforts to address this challenge are required, with a view in particular to effectively freezing and accelerating the return of stolen assets to countries of origin. Switzerland wishes to underline its leading role and commitment to ensuring further progress together with its partners.
My third point concerns ODA and its critical status as a source of financing for development. ODA should assume a complementary role, enabling, leveraging and/or supplementing the other flows and mechanisms. While the quantity of ODA is very important, its quality — that is, its effectiveness with regard to locally determined development priorities and strategies — is also crucial. Aid effectiveness principles are still relevant, as confirmed in Busan, but their implementation remains a significant challenge. Country ownership principles should be reaffirmed, the use of country systems promoted, and the participation of stakeholders reinforced.
In addition, in coming months the preparatory work for the forthcoming United Nations Conference on Sustainable Development will also provide a unique opportunity to move forward on the financing agenda. It will be important to engage constructively on such critical issues as creating a stronger link between global environmental policymaking and financing, the issue of additionality and the role of the private sector.
Finally, we would also like to underline the need for renewed momentum in the discussions on inclusive growth and in the deployment of serious efforts nationally, regionally and internationally to respond to this increasingly important challenge. Growth must be inclusive, sustainable and balanced, as noted by an earlier speaker. We call for close collaboration between the United Nations system and the international financial institutions on this important agenda. Special attention should be paid to youth employment and gender aspects.
Overall, and I will finish with this, Switzerland reaffirms the importance of ensuring effective follow-
up to the implementation of the Monterrey Consensus and the Doha Declaration, particularly in the preparation of the post-Millennium Development Goals discussion.
I want to start by thanking the President for having organized this High-level Dialogue on Financing for Development.
We are just four years away from the Millennium Development Goal target year. While there has been progress in several areas, it is clear that many of the targets will remain unmet. A key element in our inability to realize even the minimum goals that were set for those in the greatest need is the gap in development financing. While the gap in aid delivery and external finance has undermined the capacity of the developing world to meet its development aspirations, the global economic crisis has further burdened it with limited growth, higher unemployment and increasing poverty, resulting in lower domestic resources targeted at development.
With the global output continuing to show a downward trend in 2011, the prospects of developing countries increasing their exports, managing external debt and attracting foreign direct investments appear to be less encouraging. It is therefore essential that growth-promoting policies be pursued to strengthen global economic recovery, which in turn would allow countries to raise higher public revenues. In this regard, it is imperative that countries work towards financial inclusion and progressive tax policies; but it is equally important to strengthen and democratize international tax cooperation and policymaking.
Foreign direct investment is important to financing development. However, its quantum, especially in the adverse economic circumstances of today, cannot be expected on its own to tackle poverty, hunger and disease in developing countries. Foreign direct investment must also forge productive linkages with the wider local economy and be consistent with the broader objectives of sustainable development if it is to have a meaningful impact.
International trade has long been seen as an engine for development, especially by developing countries that are dependent on exports. In recent times, however, significant risk factors, including rising food and energy prices, increasing tariff and non-tariff barriers, and other forms of export restrictions, have negatively impacted on trade
prospects for developing countries. Lack of market access, Aid for Trade and a skewed multilateral rule- based trading system continue to deny a level playing field to developing countries. If we wish to make trade a credible engine for inclusive growth, there is no getting away from a balanced and development- oriented outcome of the Doha Round. And while doing so, we must ensure that trade-distorting factors, including agricultural subsidies in developed countries, are comprehensively addressed.
The debt situation in a large number of developing countries remains untenable, with their ratio of external debt to gross domestic product being more than 20 per cent in some cases. This fundamental economic weakness has further retarded their development process. Much remains to be done on debt relief and debt sustainability.
It is clear that developing countries, especially the least developed countries, landlocked developing countries, small island developing States and other countries in Africa cannot meet their development challenges without external assistance. Official development assistance (ODA) remains an important source of development financing for them for which there is no substitute. Meanwhile, the gap in ODA financing continues to widen. In 2010, only five donor countries met their ODA commitment of 0.7 per cent. The aid flow to developing countries last year stood at $129 billion, representing 0.32 per cent of the total gross national income of the donor countries and well short of the 0.7 per cent mark. It is deeply worrisome that the global crisis is being made an excuse for not meeting existing commitments.
The commitment that the international community made in Monterrey and Doha to ensuring predictable development assistance to developing countries — including ODA, concessional financing and debt relief — and to supporting nationally owned development strategies needs to be fulfilled urgently. India for its part is privileged and committed to sharing its development expertise with fellow developing countries. Under our flagship development cooperation platform, the Indian Technical and Economic Cooperation programme, we are extending capacity- building and technical support to 161 developing countries, with around 7,400 vocational training slots on an annual basis.
Our development partnership in recent years has expanded to include lines of credit and grants to boost economic and trade partnerships. India has committed $1 billion in lines of credit for the implementation of the Istanbul Programme of Action for the least developed countries, in addition to 250 new training slots annually. We have also committed $5 billion in lines of credit to Africa over the next three years, and an additional $700 million in grant assistance for human resource development, the transfer of technology and building new institutions, in consultation with the African Union.
South-South financial and technical assistance may be expanding, but we need to be clear that it can neither be a substitute for North-South aid nor dilute those aid commitments. It is also important to recognize that developing countries that are burdened with huge socio-economic challenges of their own cannot be expected to meet the obligations of the developed world.
What is acutely worrisome is that the discourse on global aid architecture these days is increasingly focused on drawing developing countries into the North-South aid paradigm. South-South cooperation can neither be viewed through the traditional donor- recipient prism of North-South development cooperation, nor subjected to the demand for harmonization of aid by donors, given its distinct paradigm and particularities. In this context it is noteworthy that the recently concluded High-level Forum on Aid Effectiveness in Busan accepted that South-South cooperation is different from North-South aid.
Given the resource gap in financing for development, it is imperative that innovative sources of financing be explored. However, we see innovative sources as additional to and not a substitute for ODA. There is therefore a need for a common understanding on what constitutes innovative sources of financing. It is also important that these finances be disbursed in accordance with the priorities of developing countries and do not place an unfair burden on them.
A comprehensive reform of the international financial architecture to address systemic issues lies at the heart of general implementation of the financing for development process. India has been working closely with like-minded countries to ensure a greater voice and participatory space for developing countries
in the international financial institutions. Much work remains to be done, however, to ensure that global economic governance and the development agenda complement each other. The financing for development process, as embodied in the Monterrey Consensus and the Doha Follow-up International Conference on Financing for Development to Review the Implementation of the Monterrey Consensus, is crucial for the attainment of our development aspirations. We must adhere to its principles in letter and spirit.
Nigeria appreciates the importance of this agenda item at a time when economies across the globe are grappling with the ongoing recession and its consequences. My delegation associates itself with the statements made by the representative of Argentina on behalf of the Group of 77 and China and the representative of Tanzania on behalf of the African Group, and wishes to add Nigeria’s perspective to the debate. We expect this meeting to come up with a salutary outcome that will justify its raison d’être.
The importance of the international financial system and how it could resolve the effects of the current economic crisis continues to gain global momentum in every debate on this subject matter. Based on the lessons learned, my delegation believes that, in order to build a global financial system that will restore investor confidence, provision must be made for strong and vigilant regulatory oversight. With the expansion of global economic imbalances in an increasingly interdependent global economy, international cooperation and adequate regulation are inevitable in the effort to stabilize financial flows between and among countries.
It is therefore evident that developing economies are the most affected. They face difficult financial situations that ultimately reduce their abilities to finance critical programmes that are relevant to enhancing their growth potential. At the same time, in view of the increased demand for funding by developing countries, these countries are at a disadvantage when accessing international capital markets. It has therefore become imperative that timely action be taken to safeguard the financial capacities of both the International Bank for Reconstruction and Development and the International Finance Corporation, which are both part of the World Bank Group, in order to sustain scaled-up assistance to client countries.
While steps are being taken to address the financial capacity of these organizations, it is critically important for these institutions to honour previous commitments to the International Development Association (IDA). It is our hope therefore that a stronger capital base will facilitate the World Bank’s enclave-lending to IDA countries. Also, there should be an enhanced focus on making financing available to fragile and conflict-affected countries that are the worst hit by the crisis.
Nigeria recalls the great hopes that the Monterrey Consensus held for global economic growth and development, especially for developing countries. That hope was not misplaced, as it was based on a collective desire and perceptive understanding of the goals to be achieved. The intentions were genuine and expectations justified. And true to the spirit and content of the document, the economies of most developing countries actually exhibited some modest growth, which soon virtually evaporated in the face of unforeseen challenges.
The 2008 Doha Follow-up International Conference on Financing for Development to Review the Implementation of the Monterrey Consensus, which was set to redress obvious setbacks and give impetus to the implementation of Monterrey, was also to chart the way forward in implementing and exploring innovative ways of generating resources for development. This had become even more imperative as a result of serious mitigating factors inhibiting development, including the convergence of global crises — energy, food and financial — and their culmination in the global economic meltdown that has since plunged the entire world into a deep economic recession.
Nigeria’s gross domestic product (GDP) grew from 7 per cent in 2009 to an estimated 8.1 per cent in 2010. Its medium-term prospects are bright, with real GDP growth projected to remain strong and stable at 6.9 per cent in 2011 and 6.7 per cent in 2012. This underscores the resilience of the Nigerian economy. Medium- to long-term prospects will require addressing key reforms in order to advance infrastructure development and broaden the economic base through enhanced private sector participation.
However, in order to better manage the economy and set the stage for long-term stable growth in an effort to break the past 30 years of uncontrollable boom-and-bust cycles, the Nigerian Government
introduced a transformation agenda that recognizes trade and investment as linchpins of Nigeria’s international engagements. That was with the clear realization that trade and investment have the capacity to leverage and catalyse economic development. Furthermore, the economy is also being diversified not only to promote exports but also to expand our infrastructure base to complement the attainment of the Commerce 44 strategy, which targets the penetration of specifically identified international markets with products from designated major sectors of the economy.
The main thrust of Nigeria’s trade policy is the integration of the economy into the global market system. This entails progressive liberalization to enhance the competitiveness of domestic industries, effective participation in trade negotiations to harness the benefits of the multilateral trading milieu, the promotion of the transfer, acquisition and adoption of appropriate technologies, and support for regional integration and cooperation.
Nigeria is making progress with economic reforms that are delivering strong economic fundamentals. The Government has maintained prudent macroeconomic policies and strengthened financial institutions and is, albeit slowly and unevenly, undertaking reforms to transform the economy structurally. The reform effort, aided by revenue from high oil prices, has led to significantly improved macroeconomic outcomes, lower inflation and strong GDP growth.
The task before us is indeed enormous and highlights the need to guard against setbacks in achieving the Millennium Development Goals by 2015. This will require the adoption of a risk-focused and rule-based international regulatory framework and strong support for appropriate policies to limit the volatility of short-term capital flows and for the entrenchment of tools to encourage long-term foreign direct and portfolio investment.
Debt-servicing efforts to sustain the escalating debt burden faced by developing nations continue to be plagued by negative external factors such as adverse exchange-rate movements and volatile remittances in official development assistance. In order to attenuate credit shocks, Nigeria’s Debt Management Office has developed a national debt management framework to guide various policies and to map out strategies for
external and domestic borrowing by Governments at the federal, state and local levels. Furthermore, the Government has established a sovereign wealth fund to help cushion the effects of a steep drop in revenue. My delegation therefore reinforces the call for more debt relief, including outright cancellations for poorer nations, and for the exploration of more options to restore steady and income-generating development assistance.
The global economy still faces considerable risks and challenges. The crisis has impacted and will continue to impact on the developing economies. We note with concern that the recovery of our economies may take much longer than expected. In this regard, efforts to stimulate economies and action to promote job creation and safety nets remain critical to ensuring that the remarkable gains of the past decade are preserved. These efforts will help the continent return to strong and all-inclusive growth, and provide the basis for making inroads into poverty reduction.
My delegation notes that, in response to the crisis, the World Bank Group has taken measures within its capacity to increase its grant and concessional lending by introducing new instruments, fast-tracking implementation, and front-loading commitments. In this context, we applaud the Bank for establishing the IDA Fast Track Initiative and urge that disbursements be similarly expedited.
While these efforts are encouraging, they are not comprehensive enough and fall far short of what is needed to quickly respond to such crisis in IDA countries. My Government urges an expeditious reform of the international financial system that would enable these institutions to play their roles more efficiently, effectively and with a high degree of transparency and accountability in their structures, functions and governance. We hope that such reforms will provide for the empowerment and enhancement of the delivery capacities of regional financial institutions to enable them to support development activities in developing countries, especially in sub-Saharan Africa.
To conclude, Nigeria wishes to emphasize the necessity for an improved and invigorated international surveillance system at both the bilateral and the multilateral levels. That would ensure that future crises will not take the world unawares again.
Costa Rica associates itself with the statement made by
the representative Argentina on behalf of the Group of 77 and China and wishes to make additional comments in its national capacity.
The financing for development agenda covers a wide array of topics and is closely linked and essential to the achievement of the Millennium Development Goals. The implementation of the Monterrey and Doha commitments is essential to developing countries, and we therefore make an urgent and necessary call for the successful conclusion of the Doha Round. To that end, all countries members of the World Trade Organization (WTO) must demonstrate the flexibility and political will necessary to overcome the impasse in current negotiations. Without consensus on the Doha Round and its development agenda, including the understanding on dispute settlement, it will be practically impossible to ensure timely compliance with WTO rules or to fulfil the international community’s commitment to generating new opportunities in international trade.
The fifth High-level Dialogue on Financing for Development could not have come at a better time. The current economic climate requires particular efforts from the Organization and us, its member countries, to find new, more practical, realistic and consistent approaches to improving the mobilization of financial resources for development. We believe that close and transparent coordination among all the stakeholders within and without the United Nations system is essential if we wish to move forward on this crucial area.
Costa Rica has always believed that, while every country is responsible for its own economic and social development, their national efforts should be accompanied and complemented by support from the international community. Along these lines, the United Nations system plays a crucial role in the consideration of and search for joint and creative solutions for financing for development.
We continue to bear significant burdens that hinder progress towards sustainable development. We are concerned that there are still few developed countries meeting the commitment to allocating 0.7 per cent of their gross national product to official development assistance. Although it is not clear at first sight, this harms all countries as it retards development in developing countries and thereby reduces opportunities for one and all.
That is one reason why international cooperation with middle-income countries has been falling. Costa Rica has directly suffered from a systematic drop in non-reimbursable cooperation in recent decades, precisely because of these limitations and its classification as a middle-income country. While we believe that aid should be focused on the most vulnerable countries, we should not exclude the middle-income countries that, thanks to their effort and sacrifice, have made progress towards higher levels of development but remain vulnerable.
We therefore reiterate the importance of differentiated treatment for the middle-income countries, bearing in mind that each country is responsible for its own development. Costa Rica believes that it is counterproductive to mix the criteria for the allocation of international cooperation, modalities and types of aid for all countries, which, as we have seen, only promotes unnecessary and inappropriate competition for international cooperation resources. We wish not to replicate the traditional modalities of cooperation, but to foment true partnership that is respectful and balanced and fuels leadership and ownership in the recipient country, specifically in knowledge transfer and capacity- building.
To that end, it is essential that we design a working mechanism to analyse development financing adapted to middle-income countries. Given a dearth of analysis and discussion of which modalities and mechanisms are most effective in addressing the needs of middle-income countries, we believe it would be advisable to postpone any decision on graduating those countries from development cooperation. For Costa Rica, this would entail an increase in the threshold for graduation and a serious discussion in which every country is able to lay out its situation and propose the most consistent modalities for eradicating poverty and attending to the most pressing needs.
As for South-South and triangular cooperation, we recognize the efforts made by developing countries that, despite their limitations and in a difficult global financial and economic crisis, continue to cooperate with other countries. However, as we have noted in other forums, these systems of cooperation are not substitutes for North-South cooperation but rather complement it.
We recall that middle-income countries are home to the majority of the world’s poor; thus, in eradicating poverty it is essential that we focus on cooperation plans in these countries. It is also necessary to bear in mind that the economic and social progress made by these countries has been hampered by negative economic climates and natural phenomena. This justifies the call for the maintenance of development cooperation until the achievements made to date have been firmly consolidated.
Resources for development cooperation must be consistent, verifiable and predictable. As we see it, only a small portion of all the resources sought for development are needed to address exclusion and inequality in our countries, and the majority funding must come from national resources. We also believe that there should be transparency and accountability in the use of all resources.
Today, almost 10 years after the Monterrey Consensus and three since the Doha Declaration, the goals that bring us together now are unfortunately the same as they were then: eradicating poverty, achieving sustained economic growth and promoting sustainable development, while moving towards a global economic system based on equality and inclusion. It is clear that we have not moved forward as we should have, which should lead us to consider and seek new domestic and international approaches.
My delegation associates itself with the statement made by the representative of Argentina on behalf of the Group of 77 and China.
Meeting the internationally agreed development goals, particularly those related to addressing poverty and hunger, would mark a great achievement in shaping a world free from hunger and want. Eradicating poverty is the gateway towards achieving other development goals. It is, however, quite alarming that the number of people suffering from hunger now exceeds 1 billion. The dignity of one seventh of the world’s population hangs in the balance. There is an urgent need to deliver the commitments made by the developed countries to redressing past failures, while making new and additional commitments to assisting them to face new challenges posed by the financial and economic crisis. It is disappointing to note that, despite all the optimism, the world will most probably miss its 2015 target of halving the number of the poor.
As a matter of fact, most developing countries — despite having undertaken economic reforms, put in place sound economic and financial policies at home, and opened their economies to market principles — are confronted by severe multiple, interrelated global crises, in addition to the consequences of the economic and financial crisis. Indeed, the more they have exposed themselves the more they have suffered. While this fact highlights yet again the importance of the State playing a meaningful role in support of development, as well as the significance of an enabling external environment, it also reveals that a supportive, fair international environment is far from realization.
Domestic reforms and resource mobilization, official development assistance, humanitarian assistance and increasing South-South cooperation have proven to be insufficient to overcome the challenges facing developing countries, in particular the poorest among them. Unless there is a real shift at the systemic level towards the creation of an open, transparent, non-discriminatory and rule-based world economic order, developing countries will always remain vulnerable to external shocks regardless of what they do at home or among themselves.
Global economic governance apparently lags behind the current global trends pertaining to transparency, accountability and democratic representation. Subsequently, the outcomes and outputs of such a structure do not enjoy global legitimacy or ownership. Global trade and financial governance needs to work for development. In our understanding, however, the solution does not lie in shifting from one exclusive mechanism to another. At the same time, simply trading off voting powers to reflect the current shares of players in the global economy is but a reminder of the pattern exploited in 1945.
These changes will not fix the shortcomings of the global economic governance. They will not address the persistent imbalances and inequalities at different levels. There is an urgent need to revisit the mandate of the current institutions so as to put stability and development at the top of their agenda, create greater coherence between the trading system and monetary and financial sectors, reduce the predominance of financial markets over the real economy, and deeply reform the international exchange-rate system in order to deal with the imbalances at the international level.
We recognize the importance of exploring new and voluntary innovative resources for development at both the national and the international levels. They can be used as supplementary in financing development needs, in addition to fighting poverty, disease and hunger. Though much more can still be done, we take note of the progress achieved so far in this regard.
Based on the principle that polluters pay, those activities that have dire adverse impacts on world peace, development and stability are most eligible to become subject to an international levy. As a matter of fact, despite the world economic and financial crisis, worldwide arms sales show an increase of 22 per cent over the past five years. The business of war is making huge profits while causing agony, destruction and suffering for the world and its people. Perhaps it is high time for the business of war to assume its responsibility for peace and development. Considerable resources could be mobilized through imposing a peace and development levy on the arms trade.
Because of the late hour, I will try to be brief. Germany wishes to endorse and fully align itself with the statement made by the observer of the European Union.
The financing for development agenda is an important process to emphasize the need for more and more varied forms of development finance. It is closely related to the achievement of the internationally agreed development goals, including the Millennium Development Goals (MDGs). It tasks developing countries, emerging economies and donor countries alike to mobilize more development finance. While official development assistance (ODA) is an important component, domestic resources — public and private — as well as private investments and remittances to developing countries must also play a significant role. Therefore, we concur with the European Union that mobilizing development financing from all available sources is crucial to fighting poverty and achieving the MDGs.
An increase in financing for development is a necessary condition to achieve the internationally agreed development goals. Yet, it is certainly not sufficient. Other conditions must be fulfilled as well. On the one hand, developing countries must have ownership and must live up to their primary responsibility for their own development by creating an enabling domestic environment. Here, Germany is
assisting its partner countries in achieving results, with both technical and financial cooperation.
On the other hand, aid and development effectiveness must improve. In this regard, Germany welcomes the results on policy coherence for development that the international community achieved at the Busan High-level Forum on Aid Effectiveness last week. We especially appreciate the commitments to improved division of labour among donor countries, increased effectiveness and efficiency, and the involvement of the private sector in realizing development results.
Germany remains committed to its part of the European Union’s ODA targets. We understand that ODA remains important for achieving development goals. In 2010, global ODA as well as the European Union’s collective ODA reached historic highs. Germany itself also made its highest ODA contribution ever in 2010, with almost $13 billion spent on a net- flow basis.
An important factor in this context has been the considerable progress made in raising resources through innovative financing mechanisms. Since the Monterrey Consensus was adopted in 2002, Germany has mobilized more than €12 billion — roughly $16 billion — in innovative financing mechanisms, such as revenues from the sale of emissions allowances, public-private structured investment funds, Debt2Health conversions, and the blending of public with capital market funding. For the future we see a clear and continuous need and benefit in mobilizing more non-government contributions.
Let me conclude by saying that Germany remains fully committed to the Monterrey Consensus and the advancement of the agenda on financing for development.
In accordance with General Assembly resolution 62/76 of 6 December 2007, I now call on the observer of the Eurasian Development Bank.
The activities of the Eurasian Development Bank seek to strengthen international financial and economic cooperation for the development of States members of the Bank. The Bank fosters sustainable economic development and integration processes with the selection and
implementation of investment projects that stimulate trade flows and reciprocal investment.
The Bank, established in January 2006, is an international financial organization whose memberships include Armenia, Tajikistan, Belarus and Kyrgyzstan. The Bank’s core capital exceeds $1.5 billion. The Bank has hit its stride in stepping up integration in the post- Soviet region. Over the past five years, the Eurasian Development Bank has financed projects to the order of $3 billion and has proved to be a successful regional instrument of development. At this stage, 46 projects funded by the Bank are under way. The number of projects in the pipeline — that is, projects currently being considered — exceeds $8 billion.
The investment portfolio of the Bank could potentially generate reciprocal trade flows to the order of $1 billion a year. According to our estimates, our investment projects increased, inter alia, reciprocal trade between Russia and Kazakhstan with exemptions on fuels to the order of 10 per cent a year. The rise in reciprocal investment under the Bank’s projects exceeds $1 billion. The focus of our investment projects is accelerating economic growth in member countries.
Full-scale infrastructure projects are under way in the transport, energy and auto manufacturing spheres. Priority is accorded to agribusiness, high technologies and innovation. Over the past three years, integration processes in the post-Soviet space have picked up pace. Indeed, they were dictated by the objective need to counter the crisis through economic stimulus. It is clear that the consequences of the crises are easier to overcome through joint activities.
Thus, in 2009 six States of the region established the Eurasian Economic Community Anti-Crisis Fund totalling $8.5 billion. The Eurasian Development Bank manages the Fund. Last year, some $70 million in financial credit was provided to Tajikistan over the course of 20 years. This year, a decision was taken to provide Belarus with credit totalling $3 billion over 10 years, including a concession period of three years.
Moreover, we are active participants in the drafting of recommendations for a package of economic reforms to stabilize the macroeconomic
situation in countries with which we work. We coordinate our efforts with the International Monetary Fund and the World Bank. This coordination is essential to ensure that recipient States are guided by integral and comprehensive recommendations for their economic policies.
Today, we can draw preliminary results from the activities of our customs union. A customs unit has been established and customs procedures streamlined. Advantageous conditions have been established for dealing in the products and exports of the three participant countries. Steps are being taken to establish a unified economic region. Member States have signed a package of 17 documents for coordinating monetary, budgetary and macroeconomic policy. That has allowed for the use of more effective anti-crisis mechanisms, lowering the volatility of economies and improving the investment climate in our States.
Our strategy is strengthening our position as an intellectual leader of integration. Our Bank has not only sought to support integration processes with financial resources, but also to actively cooperate through the provision to member States of information and analytical resources in these processes.
I should like briefly to touch on our cooperation with the Economic and Social Council within the framework of the United Nations Special Programme for the Economies of Central Asia. The management of water and energy resources and transboundary rivers is one of the most complex and contentious areas of cooperation in this region. We support the activities of the Special Programme for the Economies of Central Asia and the International Fund for saving the Aral Sea in research and funding. Of particular focus is the impact of climate change on water resources in Central Asia, ensuring security in water infrastructure and joint use of transborder water stocks.
In conclusion, I should like once again underscore the Eurasian Development Bank stands ready actively to cooperate with organizations seeking to create conditions conducive to the full economic development of countries of the region and helping them to achieve their economic potential.
The meeting rose at 5.55 p.m.