Multilateralism and a stable, inclusive international trade environment are crucial to developing countries, while growing debt threatens their progress in sustainable development, speakers told the Second Committee (Economic and Financial) today during debate on macroeconomic policy questions.
Michael Gaffey, permanent representative of Ireland to the United Nations in Geneva and President of the Trade and Development Board, introduced the report of the Board, stating the multilateral system itself is facing a crisis of trust and loss of effectiveness as Member States fall behind in implementing the Sustainable Development Goals. Pamela Coke-Hamilton of the United Nations Conference on Trade and Development (UNCTAD) introduced the Secretary-General’s reports on international trade and development and world commodity trends and prospects, noting that a challenging outlook for world trade includes exacerbating global tensions due to a diversion from markets and escalating tariffs.
With many representatives calling for a universal, rules-based, fair and non-discriminatory trading system, Indonesia’s delegate, speaking for the Association of Southeast Asian Nations (ASEAN) stressed the importance of a stable macroeconomic environment amidst heightened financial and trade uncertainties. He noted ASEAN continues to expand economic partnerships and eliminate investment restrictions.
The representative of Paraguay, speaking for the Group of Landlocked Developing Countries, highlighted the importance of international trade for States in his group, expressing concern that they account for less than 1 per cent of global exports. He called on Member States to address their marginalization in international trade and improve their participation in the multilateral trading system. Cuba’s delegate said the current international scenario represents an obstacle to a country’s right to develop, which is compounded by erosion of the multilateral framework.
Noting unilateral and protectionist measures threaten international cooperation and multilateralism, China’s representative called on the international community to safeguard World Trade Organization (WTO) policies, strengthening open and non-discriminatory trade and broadening non-differential treatment for developing countries. Nigeria’s delegate said the absence of a multilateral system prevents developing countries from maximizing benefits of international trade, threatening Africa’s ability of to achieve sustainable development.
The representative of Cabo Verde, speaking for the African Group, stressed that the continent’s share in global trade remains critically low despite growth among developing countries in 2018. Despite this, the African continental free trade area went into effect on 30 May and is the world’s largest, including over than 1.2 billion people and generating $3 trillion in gross domestic product (GDP).
Malawi’s delegate, speaking for the Group of Least Developed Countries, warned that global partnerships are conspicuously dwindling, with trade volatility and growing debt levels undermining their ability to achieve the Goals, calling for more drastic international policy action including debt relief initiatives. The representative of Jamaica, speaking for the Caribbean Community (CARICOM), echoed that sentiment, noting the Institute of International Finance estimated that by the end of March 2018, global debt stocks would reach $247.2 trillion, a high debt burden seriously threatening many developing countries’ ability to implement the 2030 Agenda for Sustainable Development.
Speaking on behalf of the Alliance of Small Island States, the representative of Belize affirmed that debt stocks in her group had doubled between 2008 and 2017, the ratio of external debt to export ratio reaching 163 per cent. She noted when those developing ocean States seek financing, they are simply advised to fix their domestic situation and spend smarter, do better. Meanwhile, the Russian Federation’s delegate affirmed the international community’s focus should be on supporting developing countries, stabilizing commodity markets and eliminating debt. He observed that his Government has written off more than $20 billion in African debt over the past 15 years.
Reports were also presented by the Director of the Financing for Sustainable Development Office of Department of Economic and Social Affairs on the international financial system and on international financial conferences; the Chief of the Debt and Development Finance Branch in the Division on Globalization and Development Strategies in UNCTAD, on external debt sustainability and development; and the Senior Economic Affairs Officer in the Economic Analysis and Policy Division of Department of Economic and Social Affairs on unilateral economic measures.
Also speaking today were the observer of the State of Palestine (on behalf of the Group of 77 developing countries and China), and representatives of Sierra Leone, Algeria, Singapore, Saudi Arabia, Iran, Qatar, Syria, Honduras, Thailand, Guatemala, Morocco, Maldives, Philippines, Mexico, Malaysia, Zambia, Panama, Lao People’s Democratic Republic, Iraq, Cabo Verde (in its national capacity), Nepal, India, Sudan, Kazakhstan, United Arab Emirates, Ukraine, Cameroon, Kenya, Namibia, Libya, Peru, Egypt, Ecuador, Norway, Antigua and Barbuda, El Salvador, Niger, Senegal and Burkina Faso. The Holy See and the International Labour Organization also spoke.
MICHAEL GAFFEY, permanent representative of Ireland to the United Nations in Geneva and President of the Trade and Development Board, introduced the report of the Board (document A/74/15). He said with the world facing such existential threats as climate change and environmental degradation, the multilateral system itself is facing a crisis of trust and loss of effectiveness. The international community must rethink cooperation to tackle pervasive economic, social and environmental challenges that impede development.
He said the United Nations system has been daunted by plethora of challenges in implementing the 2030 Agenda for Sustainable Development, as discussions in the United Nations Conference on Trade and Development (UNCTAD) now acknowledge. Presenting a number of reports on a series of conferences, he stated that Member States are falling behind in implementing the Sustainable Development Goals. He cited the upcoming fifteenth UNCTAD quadrennial conference, to be held in Bridgetown, Barbados in 2020, as an opportunity to address the crisis in the multilateral trading system.
Climate change is an existential threat to the most vulnerable, especially small island developing States, he continued. Citing the role of trade in building resilience, he said the ocean economy provides jobs for 40 million people, raising the question of whether harmful fish subsidies should be eliminated. There has never been this degree of urgency to transform economies, as the multilateral system must adapt if it is to remain relevant. Trade is a key enabler of the Goals but is threatened by protectionism and unilateralism. He stated the outlook for trade is underwhelming, with the World Trade Organization (WTO) having downgraded forecasted growth for 2019-2020 and economists warning about unpredictability. He noted the 2019 Digital Economy Report challenges States to address world as digitalization is fundamental to the Goals. As a subsidiary body of the General Assembly, he stated UNCTAD looks to strengthen its contribution, and hopes preparation for UNCTAD 15 will provide that opportunity for greater collaboration between New York and Geneva.
PAMELA COKE-HAMILTON, Director of the Division on International Trade and Commodities, UNCTAD, introduced the Secretary-General’s reports on international trade and development (document A/74/221) and world commodity trends and prospects (document A/74/232). She noted that the outlook for world trade is challenging, with global tensions exacerbating this due to a diversion from markets and escalating tariffs. The international community cannot continue business as usual, although it can take long-term remedial steps to improve the situation. Trade in services has grown faster than goods and continues to grow, but a lowered estimation in trade growth bodes ill, while increased unilateral action has created an aura of unpredictability.
Turning to the effects of climate change, she said adaptation and mitigation efforts to that phenomenon can be mainstreamed into trade policies. On the positive side, the global call to action in combating climate change has called on the world to rethink how it lives and does business. Adding that small island developing States are responsible for less than 1 per cent of global emissions but suffer the brunt of climate change’s negative impacts, she said building resilience and developing climate friendly policies in such nations will be a critical issue on the global agenda.
Continuing, she noted that the oceans economy provides employment for over 40 million people. Despite their size, small island developing States possess large ocean economies. Possibilities for economic largesse are great in such States but will require investment to combat such threats as climate change and ocean acidification. She further observed that those and other developing countries have benefited from international trade, but the increased share has mainly occurred in Asia, where global trade jumped from 10 to 36.5 per cent over the past few years. This increase has not been seen in other developing areas, especially in least developed countries. In those nations, growth has stagnated, growing less than 1 per cent over the same period.
NAVID HANIF, Director of the Financing for Sustainable Development Office of Department of Economic and Social Affairs, introduced the reports of the Secretary General on international financial system and development (document A/74/168) and on follow-up to and implementation of the outcomes of the International Conferences on Financing for Development (document A/74/260).
He said sustainable financing requires a long-term perspective. The quality of investment is important, and so is quantity, with a need to move beyond the billions and trillions narrative to find impactful solutions. Sustainable development is not just about raising money, he noted, but is about getting the framework right and fixing the system. The first report identifies major trends reshaping the financing of development landscape and notes global growth has slowed while trade tensions have increased. He stressed that 30 least developed countries and middle-income countries are already in debt distress.
He also noted positives, as investors take global risks into account, and advancement in artificial intelligence and big data accelerate sustainable development progress. However, neither domestic nor global development has adapted to those changes, underlining the need to build on positive trends while managing new risks. Moving on the second report, he said the global environment has changed since 2018, with the financial system failing to allocate funds for long-term development needs. The rapid growth of financial technology has revealed new risks, and regulatory frameworks need to balance innovation, access and risk management. He said Member States have announced regulatory barriers on use of crypto asset tokens. The international community must examine if its institutions remain fit for purpose, as more inclusion is necessary. He stressed that the obstacles to be overcome should be the focus of deliberations in the Second Committee.
STEPHANIE BLANKENBURG, Chief of the Debt and Development Finance Branch, Division on Globalization and Development Strategies, UNCTAD, introduced the Secretary-General’s report on external debt sustainability and development (document A/74/234). Observing that the developing world is very much in the throes of a debt crisis, she said the common denominator in such nations is growing exposure to high-risk international financial markets, the growth of private debt and a total global debt of $230 trillion. Structural weaknesses in advanced economies have impeded recovery from debt and private credit has been heavily concentrated on speculative activities, leading to wider inequalities. Pointing also to increasing trade tensions, she said investor confidence is clearly tailing off and global instability rising. Since 1960, there has been a growing reliance on private debt in both developed and developing countries, which has been exacerbated by growing incidences of natural hazards and other climate-related events.
Continuing, she noted that total external debt in developing countries has more than doubled over the past few years, growing at an annual rate of almost 9 per cent. Over the past few years, the ratio of exports to debt in developing countries has risen to 108 per cent, making debt higher than export earnings for the first time in history. Recently, financing by private creditors has been taken over by riskier bond financing, which has been complicated by an inability to build international reserves. She expressed concern for the situations in small island developing States, which remain vulnerable to increasingly frequent shocks and natural hazards. Other low-income economies have also suffered from rising debt, which now stands at a total of $170 billion.
HIROSHI KAWAMURA, Senior Economic Affairs Officer, Economic Analysis and Policy Division, Department of Economic and Social Affairs, introduced the report of the Secretary-General on unilateral economic measures as a means of political and economic coercion against developing countries (document A/74/264). He noted those measures stood at 31 against 28 countries in June 2019, marking an increase of 2.8 measures imposed per year since 2010. The longstanding cases of Cuba and Myanmar persist despite the reestablishment of economic ties.
He noted the impact of broad trade embargoes, which have unintended adverse effects on human rights and public welfare. Member States have overwhelmingly expressed their opposition to unilateral measures, as reported in his Department’s 2019 survey. Among the 17 countries responding to that survey, six Burundi, Central African Republic, Cuba, Russian Federation, Sudan and Syria are presently affected by unilateral economic measures, reporting adverse impacts on their economies and development in the health, education and infrastructure sectors. He noted several Member States reported the measures harm the most vulnerable segments of the population. Despite the General Assembly’s call for effective measures to eliminate them, those measures against developing countries are on the rise, which is inconsistent with achieving the Goals, and inconsistent with the principles of international law as outlined in the Charter of the United Nations.
ABDULLAH ABUSHAWESH, State of Palestine, speaking on behalf of the Group of 77 developing countries and China, stressed the significance of special and differential treatment for developing States in harnessing the developmental benefit of international trade and to facilitate integrating their economies into the multilateral trading system. Reaffirming that a universal, rules-based and transparent trading system must be promoted and strengthened, he called for the elimination of coercive economic measures, including unilateral sanctions, against developing countries. Developed States must provide further support to developing countries, including technology transfers, capacity-building and financing, to avoid a build-up of unsustainable debt. As such, he called on the international community to fulfil their commitments and create an enabling environment for long-term debt sustainability. Current trends cast doubt on the capacity of the multilateral financial and economic architecture to address global challenges. Therefore, structural changes are urgently needed to address such challenges. In particular, he expressed concern over the lack of a single global inclusive forum for tax cooperation at the intergovernmental level, calling for the upgrading of the Committee of Experts on International Cooperation in Tax Matters to an intergovernmental body.
MOHAMMAD KURNIADI KOBA (Indonesia), speaking on behalf of the Association of Southeast Asian Nations (ASEAN) and associating himself with the Group of 77, stressed the importance of a stable macroeconomic environment amidst heightened financial and trade uncertainties. To this end, ASEAN continues to expand economic partnerships through negotiations and has been implementing reforms as well as eliminating investment restrictions. He underscored the need to continue promoting sustainable development cooperation through regional partnerships and the assistance of the United Nations development system. Sustainable finance for such development is vital in improving efficiencies and boosting social well-being. ASEAN supports more financial inclusiveness in the region and stands prepared to implement policies needed to stimulate growth.
DAVID MARTINEZ (Paraguay), speaking on behalf of the Group of Landlocked Developing Countries, highlighted the vital importance of international trade for States in his group as it alleviates the constraints of limited domestic markets and allows for the pursuit of structural transformation. Expressing concern that landlocked developing countries account for less than 1 per cent of global exports, he called on Member States to address their marginalization in international trade and improve their participation in the multilateral trading system. Assistance is also required to fully implement the WTO Agreement on Trade Facilitation, he said, expressing concern with the high variations on commodity prices. While new technology and the digital economy present bountiful opportunities to landlocked developing countries, the digital gap risks becoming wider unless the specific challenges of those countries are addressed. Financing for development is key to the implementation of the 2030 Agenda, he stressed, calling on development partners to fulfil their official development assistance (ODA) requirements.
PERKS LIGOYA (Malawi), speaking on behalf of the Group of Least Developed Countries and associating himself with the Group of 77, said that while least developed States needed bigger and stronger international support, global partnerships are conspicuously dwindling. Trade volatility negatively impacts least developed States, he noted, calling on the international community to fulfil their commitment on duty-free and quota-free market access for those countries. Growing debt levels in least developed countries may undermine their ability to achieve the Sustainable Development Goals, he warned, calling for more drastic international policy action including debt relief initiatives. Expressing concern that ODA is decreasing, he said the growing short-termism and volatility is likely to cause higher financial stability risks for countries that already suffer the perception of high risk and the burden of vulnerability. If new technologies are not made accessible to least developed counties, they actually risk disrupting regulatory systems and further widening the digital divide. The potential for widespread automation and its potential to cause large-scale unemployment causes concern, as well. Illicit financial flows are a major obstacle to the mobilization of domestic resources for sustainable development, he said.
COURTENAY RATTRAY (Jamaica), speaking on behalf of the Caribbean Community (CARICOM) and associating himself with the Group of 77 and the Alliance of Small Island States, said the high debt burden faced by many developing countries is a serious threat to their ability to attain the 2030 Agenda. The Institute of International Finance estimated that, by the end of March 2018, global debt stocks would reach $247.2 trillion. In a 2019 report, UNCTAD highlights the impact high debt levels have on middle-income developing countries and small island developing States, noting that they face particular constraints related to the composition of their total debt as a result of per capita income levels. Noting the pernicious impact of graduation on those countries, he said the denial of access to concessional financing windows forces middle-income countries to meet their development finance needs by resorting to more volatile private capital markets via sovereign bond issuance. Our potential is seriously constrained by having to choose between high external debt repayment and catalytic growth spending, he observed, adding that current policies do not allow access to sufficient long-term financing.
SHARON LINDO (Belize), speaking on behalf of the Alliance of Small Island States and associating herself with the Group of 77, said debt stocks of small island developing nations had doubled between 2008 and 2017. She said the ratio of external debt to export ratio had reached 163 per cent by 2017, noting an increasingly challenging global environment with a growth rate of only 3.2 per cent in 2019. Expressing dismay over that macroeconomic situation, she said securing funding in wake of disaster is in no way as difficult as long-term predictable financing, especially with ODA decreasing. She noted when those developing ocean States seek financing, they are always advised to fix their domestic situation and spend smarter, do better. However, she stressed the dark outlook on climate change, isn’t just a future threat to small island developing States, it’s already here. She stated that every dollar spent on adaptation yields a four-fold result in prevention of damage, and therefore makes sound economic sense.
ISABEL MONTEIRO (Cabo Verde), speaking on behalf of the African Group and associating herself with the Group of 77, pointed out that the share of Africa in the global trade remained critically low despite there being growth in trade among developing countries in 2018. The African continental free trade area went into effect on 30 May, becoming the world’s largest such zone soon covering more than 1.2 billion people and $3 trillion in gross domestic product (GDP). Commodities and stabilized commodity markets are vital for inclusive economic growth and sustainable development. The continent has established a commodity strategy to manage its resources and guard against price fluctuations and external market shocks. Warning that illicit financial flows deprive Africa of its resources, she urged the Second Committee to intensify its efforts to combat the scourge.
SOLOMON JAMIRU (Sierra Leone), associating himself with the Group of 77, the Group of Least Developed Countries and the African Group, said that his country’s Government recently launched a new medium-term national development plan for 2019 to 2023 and rolled out a result-based operational plan for the implementation of the goals of the 2030 Agenda and the African Union Agenda 2063. The 2017 fiscal management and control act aims to increase discipline in public procurement, which has been a major source of domestic debt accumulation. Thanks to this legislation, the revenue-to-GDP ratio has improved from 12 per cent to more than 14 per cent. The Government is also mobilizing private-sector partners and engaging donor countries on development cooperation.
DMITRY CHUMAKOV (Russian Federation) noted that multilateral trade cooperation is currently constrained by trade wars and unilateral restrictive measures. He further observed that new centres of economic growth are emerging today, emphasizing the need for reform of international financial institutions. He expressed concern about current economic trends, including the accumulation of excessive debt in developing States as well as inequalities within and between countries. The international community’s focus should be on supporting developing countries, stabilizing commodity markets, eliminating debt and ensuring food security. Over the past 15 years, the Russian Federation has written off more than $20 billion in African debt.
LATROUS M. ESSEOHIR (Algeria), associating himself with the Group of 77 and the African Group, noted that with 1 billion people worldwide living in extreme poverty, We face a steep uphill climb. Achieving the Goals requires additional spending of over 10 per cent of developing countries’ GDP, or $520 billion. He stressed that developing countries must meet commitments including the target of 0.7 per cent of gross national income for ODA. In addition, financial resources must align with national objectives and respect national sovereignty over wealth, natural resources and economic activity. Additionally, his Government believes all must redouble efforts to fight illicit financial flows and tax evasion, with this Committee being an ideal forum. He observed that recent reports show the median debt burden among low income developing countries has risen to 47 per cent of GDP. However, Algeria is one of the few developing countries to have reduced poverty below the international line of 0.8 per cent, increasing female parliamentary representation to 31 per cent and making progress in education and reducing infant/maternal mortality.
JUAN M. GONZALEZ PEAA (Cuba) said the current international scenario represents an obstacle to a country’s right to develop, which is compounded by erosion of the multilateral framework. There must be genuine political will to enable developing countries to attain sustainable development targets. Resources needed for implementation of the 2030 Agenda are being squandered by war and conflict, as evidenced by the military budget of the United States, which would greatly contribute to implementation of sustainable development goals. He stressed the need to develop a multilateral mechanism for sovereign debt and to strengthen the international trading system, which would broaden conditions for special and non-differential treatment. He rejected the application of unilateral coercive measures, which impede the right to development. Cuba has been suffering an economic blockade for decades, hampering its macroeconomic development and the establishment of normal, trade and investment relations with the rest of the world.
OLIVER CHING (Singapore), associating himself with the Group of 77, ASEAN and the Alliance of Small Island States, said his country believes that fostering a conducive global economic framework is the collective responsibility of the international community. A new system of cooperative multilateralism in global economic governance is needed and its institutions need reform. For example, new and better rules for services, e-commerce and digital technologies are needed for WTO. The international community must recommit to supporting free trade. To complement the organization’s work, Singapore has actively promoted new regional free trade mechanisms such as the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership. In addition, international law must be upheld and respected, as it provides all countries with a predictable and stable international environmental in which to conduct business, trade and investments to develop their economies. Singapore has actively led new initiatives, such as the Singapore Convention on Mediation, which aims to promote mediation as an alternative and effective method to resolve trade disputes.
WAFA FAHAD ALNAFJAN (Saudi Arabia), associating herself with the Group of 77, said development is the basis of stability and prosperity, and trade the main engine creating synergies to meet economic challenges. The international financial system should be reformed to increase transparency, all based on new partnerships between developed and developing countries. She said illicit financial flows are still growing, representing a great threat to development in countries like hers, which is a right for all States and peoples.
ALI HAJILARI (Iran), aligning himself with the Group of 77, noted that developing countries continue to suffer from deficiencies and imbalances embedded in global economic, financial and trading systems, which have brought about inequality and poverty. This is exacerbated by a continued lack of access to required technologies, capacities and financial resources. It is the right of every sovereign State to be part of a universal, rules-based, open, transparent, predictable, inclusive, non-discriminatory and multilateral trading system. The WTO, which Iran has been denied membership to for more than two decades, is the target of harsh unilateral behaviour, which puts the whole international trading system at risk. Iran, which has been targeted by the unlawful, unilateral coercive measures and a wide range of unjust illegal sanctions of the United States and its allies, has always maintained that the unilateral imposition of restrictive economic measures is unlawful and inadmissible.
NAYEF AL QAHTANI (Qatar), aligning himself with the Group of 77, said international multilateral trade on a non-discriminatory, equal basis helps developing countries achieve progress in the development cycle. He noted his Government long contributed to international development and financing efforts and is a reliable player on the global scene, having contributed $100 million to support small island developing States and least developed countries in addressing climate change. Qatar will provide a further $20 million to support the network of United Nations Development Programme (UNDP) laboratories on development issues.
MAJD NAYYAL (Syria), associating himself with the Group of 77, objected to unilateral measures against developing countries and their negative repercussions, which lead to a lack of prosperity and well-being. There is a political aspect to the measures, which are indiscriminate and impede the right of people to a better life. He appealed to the Secretary-General to include in his next report on such measures a true assessment of their consequences, which go against the Charter of the United Nations and international law. He also lamented the absence of a system of recourse for these unilateral actions through the General Assembly.
SHEIDU OMEIZA MOMOH (Nigeria), aligning himself with the Group of 77 and the African Group, said there must be greater access to technology and the market system, and called for reforms in the areas of debt and illicit financial flows. Like most developing and least developed countries, his Government desires solidarity and fidelity on international financing commitments. He stressed that the absence of a rules-based and transparent multilateral system of trade prevents developing countries from maximizing benefits of international trade, with unilateral economic measures running contrary to those principles. Those measures affect the ability of African countries to achieve sustainable development, while public and private debts continue to constrain policy objectives in fulfilling the 2030 Agenda.
FADUA ORTEZ (Honduras), associating herself with the Group of 77, stressed the need for a stable and more conducive international environment, noting that concessional financing for middle-income countries has diminished, giving these nations fewer sources of funding. She also observed that the two-thirds of developing countries and 80 per cent of least developed countries dependent on commodities suffer from price fluctuations on the global market. Her own country is dependent on coffee prices, but the global market for this commodity has complex value chains. She pointed to progress made on fish subsidies in WTO, expressing hope that further advances would be made in coming discussions. International trade is vital in raising living conditions, she said, but the current trend is leading to an increase in inequalities between countries, making the world less equal than five years ago. Only by providing incentives and increased market access can the international community successfully implement the 2030 Agenda.
KETKANYA JIARPINITNUN (Thailand), associating herself with the Group of 77 and ASEAN, said her country believes a revitalized and inclusive multilateral trading system will deliver sustainable growth and bring the international community closer to achieving the 2030 Agenda and the Sustainable Development Goals. Thailand reiterates its commitment to a universal, rules-based, open, transparent, predictable, inclusive, non-discriminatory and equitable multilateral trading system with WTO as the cornerstone. Thailand will continue to promote trade cooperation and economic integration at the bilateral, subregional and regional levels as they remain important building blocks to multilateral trade cooperation. Ensuring financial inclusion of all groups remains Thailand’s priority and it will continue to use financial technology and other innovative and affordable financial solutions to expand access to financial services by all groups, including people living in rural areas. Thailand believes countries need to redouble their efforts to implement the Addis Ababa Action Agenda on Financing for Development. Thailand has been working to mainstream the Addis Ababa Action Agenda into its national policy, supported by an effective monitoring and evaluation framework.
SHARON JUAREZ (Guatemala) said her country has made huge strides to integrate sustainable development goals into its national plans, which include a strategy focusing largely on social participation. She stressed that financing for development must be aligned with national priorities in plans and programmes and that national efforts to mobilize resources must be complemented with private sector sources. In mobilizing resources to finance development, the international community must strengthen its efforts to combat illicit financial flows. Finally, developed countries must set aside 0.7 per cent of their gross national income as ODA, which should better reflect the multidimensional aspect of poverty.
MERYEM HAMDOUNI (Morocco), associating herself with the African Group and the Group of 77, said that without a healthy international macroeconomic situation, implementation of sustainable development goals cannot be accelerated. For its part, Morocco continues to strengthen its macroeconomic policies, improve the fiscal, financial and trade sectors and diversify its economy. However, we can’t emphasize enough the role that international trade can play as an engine for development, she pointed out, expressing its commitment to support regional and continental integration, in particular the integration of Africa into the global value chain through transformative and innovative projects and partnerships.
FARZANA ZAHIR (Maldives) said that during a time of high uncertainty and consistent risks of financial stability, the growing levels of debt in least developed and developing countries is of great concern. Effective debt management, debt relief initiatives for developing countries and an increase in ODA is critical to help achieve the Sustainable Development Goals. There has been a concerning shift in the global narrative, from public to private financing, to reach sustainable development in developing countries. Yet effective contribution from the private sector in small island developing States like the Maldives is limited due to its small tax base, its geographically dispersed population and the struggle to achieve economies of scale. This drives up the costs of investments, compared to other middle-income countries which are not small island developing States. Yet durable partnerships and increased investments are needed. The Maldivian economy has maintained strong growth over the past three years and is committed to measures to ensure a more balanced budget over the next five. To this end, the Government is undertaking tax reforms to increase the country’s tax base.
ARIEL RODELAS PEA ARANDA (Philippines), associating himself with the Group of 77 and ASEAN, said that his country’s inclusive high economic growth story is backed with strong macroeconomic fundamentals. At the core of this strategy is the sustained fiscal discipline where debt is kept at manageable levels to ensure financial strength to support the massive infrastructure programme. The Philippines is on track to join the upper middle-income economies in the medium term. In anticipation of this, the Government is pursuing changes to its systems and policies, having put in place an inclusive financial system, broader taxation, and an economy driven by investments. The national strategy for financial inclusion adopted in 2015 has been an important enabler of development progress and a means of realizing sustainable development.
LUIS A. OSEGUERO FARIAS (Mexico) said all economies are interconnected thanks to international trade and information and communications technology (ICT), and therefore the international community should be concerned when growth is not inclusive. Development not only means growth, he said, but better distribution. His Government is focused on supporting multilateralism as the largest exporter in Latin America, with three-quarters of its GDP deriving from external trade. He cited the importance of the free trade agreement between Mexico, Canada and the United States. Internationally, economic growth must reduce inequalities between countries.
M. SUHAIMI A. TAJUDDIN (Malaysia), associating himself with the Group of 77 and ASEAN, warned against the spread of protectionism and expressed regrets that negotiations on free trade agreements are heavily one-sided or at the disadvantage of developing States. Malaysia had to suspend a certain negotiation due to the imbalanced terms on its palm oil and related products, he said, voicing support for the WTO as the only global body that deals with trade rules. His country recently launched a road map to restructure its economy over the next decade. It aims to close the gap between the rich and poor, enhancing people’s purchasing power, and transform its unskilled, low-wage labor force to a high-income, high-skilled one capable of attracting new investments.
CHRISTINE KALAMWINA (Zambia) underscored the need for a more inclusive, balanced and fair multilateral trading system that allows developing countries to effectively engage in global trade and improve their contribution to the share of international trade. Addressing illicit financial flows, she expressed deep concern about their negative impact on developing countries, especially on domestic resource mobilization efforts. Illicit financial flows undermine sustainable development and economic growth, as countries lose huge sums of revenues through mechanisms like transfer pricing, currency exchanges, undervaluing of assets, front businesses, false currency reporting and offshore as well as multinational corporations. She called for strengthened international cooperation and reporting on such illicit flows, stressing the need to enhance knowledge and understanding of challenges and opportunities to combat this vice.
MARIA TERESA PETROCELLI ROJAS (Panama), aligning herself with the Group of 77, said national public resources are important for development financing. It is important for Panama and developing countries to coordinate the actors, tools and means involved in financing. She noted corruption and illicit financial flows are a major obstacle to the 2030 Agenda, a global issue limiting resources and requiring the strengthening of global cooperation on tax laws. The world faces asymmetrical global economic governance, requiring targeted action to increase the involvement of developing countries. In addition, the exchange and sharing of technologies can be economic drivers for those States. She called for a global trade system that is rules-based, open, transparent and equitable under WTO, and to re-establish the multilateral system as the only way to ensure equality and inclusion.
VIRAYOUTH VIENGVISETH (Lao People’s Democratic Republic) urged developed countries to deliver on their commitments, including ODA, to support sustainable development needs of developing countries. His Government is strongly committed to implementing the 2030 Agenda with the aim of achieving a sustainable and green economy to narrow the development gap and support regional integration. Although various policy measures are being undertaken, progress remains slow due to capacity limitations, funding constraints and other challenges like massive floods over the past two years due to climate change. A development gap persists between urban and rural areas. National and subnational development plans tailored specifically to actual needs of people at provincial and district levels are needed to deliver basic social services to the local population, especially in education and health care, along with creating more job and income opportunities.
FIRAS AL HAMMADANY (Iraq), aligning himself with the Group of 77, called for transparent negotiations between creditors and debtors in the private and public sectors. Debt has become a universal phenomenon and can lead to crises. Nevertheless, he noted, developing countries are working to alleviate its impact. He said declining oil prices and the cost of fighting Islamic State in Iraq and the Levant (ISIL/Da’esh) have increased his country’s debt and harmed resources. The difficult war against ISIL/Da’esh and illicit financial flows have fuelled terrorist groups, necessitating international cooperation in that fight. The international community must also support developing economies, which is necessary for reform, leading to the prosperity of their people.
ISABEL MONTEIRO (Cabo Verde), speaking in her national capacity, said that a healthy and stable macroeconomic framework is an important prerequisite for securing a sustainable future in any country, in particular small island developing States. Cabo Verde has been taking concrete steps to implement climate change adaptation and mitigation measures but rising public debt burdens and funding access constraints continue to threaten its ability to implement its ambitions, she said, calling for international support to complement national efforts.
LIU NAN (China) noted that protectionism and unilateralism are on the rise, threatening international cooperation and multilateralism. The international community must safeguard WTO policies, strengthening open and non-discriminatory trade and broadening special as well as non-differential treatment for development countries. It should promote favourable conditions for least developed countries, assisting them to integrate into global supply chains. China will work to help improve the global financial safety net and continue with its international commitments for debt reduction and relief. Stressing that financial inclusion is crucial for the achieving the Sustainable Development Goals, he said China will work to increase access to financial services, build an inclusive financial system and strengthen international financial cooperation.
GHANGSHYAM BHANDARI (Nepal), aligning himself with the Group of 77, the Group of Least Developed Countries and the Group of Landlocked Developing Countries, noted that 80 per cent of least developed States are dependent on exportation of commodities, and the decline of those prices harms their economies. With global exports gaining no momentum, there can be little progress in achieving the Sustainable Development Goals. He noted the international community needs a holistic approach to digital development, and the increasing digitalization of finance requires enhanced digital literacy. His Government faces costs of $18 billion to integrate the Goals, and ODA remains a critical source of external financing, he said, calling on developed countries to honour their commitments and enhance trade and exports.
SIDDHARTH MALIK (India), associating himself with the Group of 77, said that the success of the Educate Girls Development Impact Bond, the world’s first such instrument employed in the Indian state of Rajasthan, demonstrates that blended finance has a brilliant future in helping developing countries attain sustainable development. India’s unique development model has made it the world’s fastest growing major economy, which expanded by more than 7 per cent annually over the last several years. It aims to make India a $5 trillion economy by 2024. Since 2014, India’s rank in the ease of doing business has improved by 65 positions. These are backed by key structural initiatives and a wave of reforms, including the introduction of the landmark one country-one goods and service tax, as well as the world’s largest financial inclusion scheme that enabled the poor to open more than 370 million new bank accounts.
OMER MOHAMMED AHMED SIDDIG (Sudan), associating himself with the Group of 77 and the African Group, said international trade is a driver of economic growth, which helps eradicate poverty and achieve sustainable development. He stressed the need for a transparent, open, predictable and non-discriminatory multilateral trading system, which must be governed by WTO and should be accessible to developing countries. On external debt, he said this issue is an obsession for developing countries, as it slows economic growth and poverty reduction. Debt has slowed human development in Sudan and limited its capacity to take advantage of ODA. He called on the international community to assist the country in settling its debt through available mechanisms to overcome challenges to development.
NURZHAN RAKHMETOV (Kazakhstan), associating himself with the Group of Landlocked Developing Countries, advocated for a transparent, non-discriminatory and equitable international trading system to serve as the backbone of the global economic structure. Landlocked and other vulnerable countries remain marginalized in international trade, isolated from major centres of economic and trading activity, and many suffer from geographic impediments, high costs of trade and transport, limited or low-quality infrastructure, border delays and customs bottlenecks. Noting that Kazakhstan will host a WTO Ministerial Conference in June 2020, he went on to outline the country’s dynamic economy, due to its structural reforms and policies of free development, entrepreneurship and large-scale privatization. Voicing concern over the vulnerability of commodity prices to fluctuations, he urged developing countries to diversify their economies and called for better coordinated global efforts to combat illicit cash flows.
ALIA ALI (United Arab Emirates), aligning herself with the Group of 77, stated there is a need for strategic financing to achieve the Sustainable Development Goals more effectively and less onerously. Her country is targeting innovation and new industries to eradicate poverty and is seeking to balance economic and social development with protection of the environment. It has allocated a $16.4 billion budget for 2019, its largest ever, and has no deficit. The funds will be used to develop sectors including health, education, social cohesion and a reliable judiciary system. She noted that the United Arab Emirates is providing 30 small island developing States with funding for renewable energy to protect their environment. Her Government is investing $1 billion in those partnerships, which also create job opportunities.
IRYNA YAROSH (Ukraine), affirming the need for good macroeconomic policy to meet the 2030 Agenda, said that access to finance and long-term investment is important in that regard. In turn, such investment requires integrated national financing frameworks that attract and protect foreign investment, aligning private and public incentives with sustainable development. In that context, she reported that macroeconomic indicators in her country have improved significantly over the past couple of years. Tight fiscal policy has resulted in a drop in debt and growth has resumed, account deficits have shrunk and international reserves have increased, while inflation has finally retreated to single digits. As there is room for further improvement, the Government is preparing to implement large-scale national reforms, with a human-centred action plan that aims at improving the business environment and solving specific social problems of different sections of the population. The purpose, she stated, is to build a solid foundation for achievement of the Sustainable Development Goals.
MEZANG AKAMBA (Cameroon) emphasized the need to reform the international trading system, making it fairer for developing countries, as its current conditions are depriving them of resources needed to finance development programmes. The international community should end subsidies and trade barriers. It should also work for debt relief, with a view to using resources that come available for development programmes. He urged all countries to support developing countries with sufficient funds for development and to move forward with repositioning the United Nations development system. Adding that his country is working to eliminate corruption and illicit financial flows, he called on banking institutions and Governments to work on reducing these illicit flows.
SUSAN MWANGI (Kenya), associating herself with the Group of 77 and the African Group, said many developing countries like hers rely on borrowing from international institutions for infrastructure development and recognize the importance of maintaining debt at sustainable levels. Kenya strives to keep its debt at manageable levels in accordance with its Public Finance Act, which is only possible if there is predictability with the international system. Kenya also recognizes the implementation of the Sustainable Development Goals, including infrastructure development, is a national responsibility and many resources are required, most of which must be mobilized nationally. For this reason, Kenya has developed an ambitious programme to raise capital by issuing bonds to ordinary citizens. It launched a mobile-centred government bond named M-Akiba in 2017, which has given Kenyans with as little as $30 an opportunity to invest in the Government securities market. Kenya is also leveraging technology to drive development and accelerate the achievement of the Sustainable Development Goals. In May, for example, it launched the Kenya Digital Economy Blueprint.
FELIX TUGHUYENDERE (Namibia) stressed that restoring the spirit of multilateral trade cooperation in the midst of rising poverty, polarization in the distribution of income and trade tensions is more important vital than ever. He expressed concern about the challenges and hurdles faced by small firms, especially those from developing countries, when they try to participate in international trade. In most cases, they are affected by anti-competitive behaviours. Small firms should be supported because it is through their participation in international trade that unequal outcomes from international trade will be rebalanced in due course. For this to be successful, the international community should promote international cooperation in competition law enforcement.
AHMED M.A. ABRAHEEM (Libya), aligning himself with the Group of 77 and the African Group, said despite predictions that global growth would continue in 2018, the last two quarters experienced a slowdown. This highlights the need for a transparent, fair and equitable global trading system. He noted that developing countries are especially vulnerable to volatile commodities pricing. In addition, external debt adversely impacts many of those countries, hindering sustainable development and national institutions. He stated that despite facing serious challenges, his Government has implemented economic reforms with assistance of United Nations Support Mission in Libya (UNSMIL). However, recent aggression on Tripoli and an attempted coup against the legitimate Government have spurred an economic turndown. He expressed hope that destination countries for funds smuggled out of the country would cooperate with his Government.
GERARDO TALAVERA (Peru), associating himself with the Group of 77, said there is a need for more follow-up and review of the international community’s agreements on sustainable development. Peru has greatly reduced poverty over the past few years but is still faced with structural inequalities and limitations. The country has been particularly vulnerable to the slowing global economic growth and fluctuations in commodity prices. It is also dealing with the effects of climate change, increased natural hazards and transnational organized crime, all of which undermine gains that have been made.
HODA ELENGUEBAWY (Egypt), aligning herself with the Group of 77 and the African Group, noted her nation’s GDP may reach that of middle-income countries by 2030. To enhance progress, her Government is aiming to enhance diversification to further achieve sustainable development, although rising debt is an obstacle. Pointing to the importance of investment in building high quality infrastructure, she called for increased international access to financing and trade integration to spur economic growth and address social concerns. As young people represent most of Africa’s population, it is crucial to invest in human capital through capacity-building. She said Egypt shares the overarching goals of the continent’s countries and cited the African free trade area as an example of turning reform programmes into active measures. She stressed the need to bridge the digital divide between developed and developing countries, and for a monetary structure to provide liquidity and deal with external shocks.
ESTEBAN CADENA (Ecuador), noting that international trade and development are closely intertwined, expressed support for a universal, rules-based, fair and non-discriminatory trading system. He said that increased trade tensions are undermining efforts to achieve sustainable development, as is debt, which has increased by 20 per cent in developing countries over the past three years. He urged for debt restructuring, which must be timely, effective and carried out in good faith. The international community must provide technical assistance for such restructuring and a global mechanism for advice and coordination of such assistance. It must also use an inclusive approach to increase availability of resources and to combat illicit financial flows as well as corruption, which undermine the right to development.
ODD INGE KVALHEIM (Norway) expressed a serious concern about the lack of progress on the financing agenda, urging intensified global cooperation along all seven tracks of the Addis Ababa Action Agenda. We must reinvent our international institutions and rules, he said, stressing that there must be a fairer distribution of taxing rights. On the growing debt vulnerabilities, he emphasized the need to walk the talk on responsible borrowing and lending and find universal and systematic solutions with borrowers and creditors to address repeated debt crisis. The good news is that we do, in fact, know most of the solutions, he said, adding that the international community knows which policy options work to get the financing for sustainable development back on track.
TUMASIE BLAIR (Antigua and Barbuda), associating himself with the Group of 77, CARICOM and the Alliance of Small Island States, called for resistance to what he called the backward trend of protectionist measures and inward policies, to achieve goals in sustainable development and peace. He said that small island developing States such as his are most vulnerable to external shock while also suffering from the effects of climate change. More must be done to protect all States from such shocks, particularly the most vulnerable. Debt relief building on the climate swap proposal of the Economic Commission for Latin America and the Caribbean (ECLAC) is critical, as 40 per cent of Government revenues go to servicing debt. In addition, he called for high-level attention to bank de-risking, which is cutting many correspondent banking relationships in vulnerable countries, leaving some CARICOM countries without any. Stating that financial flows to vulnerable countries are dissipating, he encouraged countries that are not meeting their commitments in ODA to do so. Noting that his country has been designated as high-income, leaving it ineligible for much assistance, he called for better modes of assessing vulnerability. He stressed that all such concerns are raised by vulnerable countries in an effort to foster sustainability, not dependency.
PABLO SORIANO MENA (El Salvador), associating himself with the Group of 77, said that macroeconomic policy issues is an area where the role of the General Assembly should be further strengthened. He reaffirmed the importance of the financing for development agenda, emphasizing the need to mobilize national resources and to promote a global economic order that is just and socially inclusive. International assistance must consider the unique challenges faced by different countries, particularly those classified as middle-income. On commodities, he expressed concern for the adverse socioeconomic effects of price volatilities. He further reiterated El Salvador’s commitment to seeking common solutions to global economic challenges.
MOUSA S. PARAISO (Niger), associating himself with the Group of 77, the African Group, the Group of Least Developed Countries and the Group of Landlocked Developing Countries, noted that his nation has recently implemented a public finance management reform programme. Niger stresses the need to combat illicit financial flows and boost cooperation on tax matters. It is setting up national frameworks and has adopted regional and international mechanisms to combat money laundering and terrorism. He also emphasized the need to boost international cooperation to deal with the debt issue and the effects of climate change.
SALIOU NIANG DIENG (Senegal), associating himself with the Group of 77 and the African Group, noted that trade imbalances continued to widen differences between developed and developing countries. Landlocked developing, least developed and small island developing countries are the worst affected by the fallout from this situation. Trade has also been affected by sudden changes in commodity prices as well as escalating trade tensions, with least developed countries still falling behind in expected exports. Stressing that action is urgently needed to mobilize resources for such nations, he urged the international community to fulfil its ODA commitments of 0.7 per cent per year.
MAMADOU BOKOUM (Burkina Faso) said his country seeks to maintain risk and indebtedness within sustainable levels. He noted that participation in the international trading system would lead to improved infrastructure and better access to energy for Burkina Faso. The country is undertaking measures to strengthen implementation of fuel initiatives and establishing social protection for the most vulnerable groups. He stressed the need to strengthen cooperation between States to combat tax fraud and evasions.
FREDRIK HANSEN, observer for the Holy See, drew attention to the statement made by Pope Francis that there is urgent need for politics and economics to enter into a frank dialogue in the service of life, especially human life, recommending to take a focused and honest look at the impact of macroeconomic policies on the poor and those in the margins of economic activity. Failure to consider how policies affect the poor and those living in the periphery of society is one major cause of the worsening economic inequalities within and among countries.
EWA STAWORZYNSKA, International Labour Organization (ILO), noted that the global unemployment rate is expected to remain at 5 per cent in 2019 and 2020, with the number of unemployed persons increasing by 1 million per year due to the expanding labour force. However, recent progress in reducing unemployment worldwide is not being reflected in improvement to the quality of work. A majority of the 3.3 billion people employed globally in 2018 had inadequate economic security, material well-being and equality of opportunity and many lacked job opportunities in the formal sector. Further, young people remain much less likely to be in employment and labour force participation rate of women remains significantly lower compared to that of men. These labour market concerns are compounded by the ongoing transformative change in the world of work, which is being driven by technological innovation, demographic shifts, climate change and globalization.
Source: united Nations