Unilateral coercive measures and trade practices harm the global economy as well as countries at the regional and national levels, speakers told the Second Committee (Economic and Financial) today during its debate on Macroeconomic policy questions.
Salim Baddoura (Lebanon), President of the United Nations Conference on Trade and Development (UNCTAD), introducing the report of the board, said a continued rise in economic nationalism and protectionist policies harm the weakest and most vulnerable, whereas development requires the international community to work together. Saying all countries must resist the tendency to turn inwards during hard times, the representative of Morocco noted that protectionist policies are particularly detrimental to Africa.
Similarly, the Russian Federation’s delegate expressed concern over the increasing politicization of international trade, coercive measures, sanctions, trade wars and barriers, which run counter to economic sense, also affecting human rights. The Russian Federation, he said, will not create barriers, believing in an open transparent global trade system taking into account the benefit of all. The representative of Qatar stated unilateral measures taken for political reasons run contrary to that spirit and to the United Nations Charter and international law, requiring that his country deploy tremendous effort to counter them to maintain the viability of the State.
Venezuela’s delegate noted measures such as the ones imposed on her country do not benefit economies or development, and the international community must therefore act to remove them. Likewise, the representative of Brazil stated growing discontent with the adoption of self centred national policies and the failure to address economic challenges like rising inequalities will have further destabilizing effects on long term development.
On solutions to the issue, Libya’s delegate called international trade the engine of macroeconomic growth, but said the world needs a global trade system that is multilateral and just. International financial institutions must be fairer and more responsive to individual national needs. Just as crucial, he said, they must refrain from imposing politicized conditions. The representative of Maldives stressed that international trade is a critical aspect of economic growth for small island developing States, and must be a rules-based multilateral system that rejuvenates global trade.
Reports were also presented by Pamela Coke Hamilton, Director of the Division on International Trade and Commodities, UNCTAD; Neil Pierre, Officer in Charge of the Financing for Sustainable Development Office, Department of Economic and Social Affairs; and Stephanie Blankenburg, Chief of the Debt and Development Finance Branch, Division on Globalization and Development Strategies, UNCTAD.
Also speaking were the representatives of Egypt, Indonesia, Malawi, Jamaica, India, El Salvador, South Africa, Liechtenstein, Iraq, Mexico, Belarus, Philippines, Singapore, Costa Rica, Thailand, Sudan, Honduras, Nigeria, Nepal, Peru, Algeria, Ukraine, China, Tonga, Lao People’s Democratic Republic, Ethiopia, Burkina Faso, Kenya, Cameroon, Namibia, Zambia, Iran, Norway, as well as the observer for the Holy See. Representatives of the Food and Agriculture Organization (FAO), International Labour Organization (ILO) and the United Nations Entity for Gender Equality and the Empowerment of Women (UN-Women) also spoke.
At the meeting’s outset, the Second Committee concluded its debate on the United Nations Human Settlements Programme (UN Habitat), hearing interventions by the representatives of Iraq, Iran and Syria. A representative from the International Organization for Migration (IOM) also spoke.
The Committee will meet again at 10 a.m. on Friday, 12 October, to discuss agriculture, food security and nutrition.
Outcomes of Conferences on Human Settlements, Strengthening of UN-Habitat
Ms. YOUSSEF (Iraq) said that the United Nations Human Settlements Programme (UN Habitat) is instrumental in assisting countries that have been destroyed in armed conflict, using a trust fund for nations in need. Decent housing for all is a human right, but it is a dream for many people today. It is necessary to find a solution and pragmatic ways of dealing with this kind of situation. Iraq has faced serious and rapid population growth, as people left rural areas to move into towns. Some 2.5 million people have become internally displaced, living in camps and temporary housing. Given these problems, the country’s priority now is to work as quickly as possible to rebuild in areas that have been devastated. There is a serious housing shortage, with about 16 per cent of Iranians living in temporary accommodations and slums. War in the country wiped out its resources and there has also been a drop in the price of oil.
Ms. SARRESTANI (Iran), associating herself with the Group of 77 developing countries and China, said adoption of the New Urban Agenda is transformative, but UN Habitat remains in transition. The Programme should hold eradication of poverty as an overarching mandate, while developing countries require technical assistance and capacity development. The expectations of Member States can only be fulfilled if core and earmarked financing of the Programme is addressed. With over 70 per cent of its population in urban areas, Iran continues to experience rapid growth and accelerated urbanization being distinct features of its present and future. Her Government recognizes the right to adequate housing, with concomitant policies to provide for resources, including developing high speed suburban trains.
Ms. SHURBAJI (Syria) said achieving the Sustainable Development Goals involves all national plans, including those for urbanization. Already facing challenges, the situation in her country has become even more complicated. There is the threat of terrorism and its consequences as well as selective economic measures that have been imposed. The international community must focus on assisting those countries that have suffered conflict to rebuild their housing and servicers. Eight years after a war against terrorism, Syria is regaining a measure of peace. However, creating an environment to house refugees and those displaced is a challenge. She said that her Government appeals to the United Nations to adopt an innovative resolution for countries that have been most damaged, assisting them with urbanization projects.
CHRIS RICHTER, of the International Organization for Migration (IOM), said human mobility has always played a role in urban development, with cities being the overwhelming destination for most migrants. Climate change is a primary element driving people to move from rural to urban areas, with cities being the main intermediaries between migrants and their communities, providing health care, education and other services. With secure migration therefore being crucial, the anticipated adoption of the Global Compact for Safe, Orderly and Regular Migration requires the involvement of cities and local authorities, who are on front lines of integration and social cohesion. IOM is also helping to create an enabling environment for the New Urban Agenda.
SALIM BADDOURA (Lebanon), President of the United Nations Conference on Trade and Development (UNCTAD), introduced the report of the board (document A/73/15). Saying fair globalization is at heart of its mandate, aiming for prosperity and a better future for humanity, he noted that the theme at a recent UNCTAD conference was from decisions to actions. The Intergovernmental Group of Experts on Financing for Development examined illicit financial flows, leading UNCTAD in collaboration with the Economic Commission for Africa (ECA) and the United Nations Office on Drugs and Crime (UNODC) to develop better data to measure them. He stated UNCTAD Member States also called for developing stronger linkages between Geneva and New York intergovernmental processes.
Addressing the crisis of multilateralism and trade, the recent UNCTAD high level segment suggested the need for a new deal for equitable globalization, sustained by a fair and inclusive global economy, he said. A continued rise in economic nationalism and protectionist policies harm the weakest and most vulnerable, whereas development requires the international community to work together, with such concrete actions as ending harmful fishery subsidies and doubling the exports of least developed countries. The digital economy must address digital divides and help small businesses compete. Policies must address financial leakages generating such harmful trends as tax avoidance and illicit financial flows. Likewise, he noted smart trade policies and a multilateral approach can promote sustainable production and consumption and make development inclusive.
Continuing, he said the report notes the major role technology and innovation play in meeting the Sustainable Development Goals, but the proliferation of new technologies also brings risks that may overwhelm societies and policymakers. Addressing economic development in Africa, he said UNCTAD must work across three pillars of research and policy analysis, technical assistance and consensus building in support of the African Continental Free Trade Agreement. Similarly, debt management, least developed country graduation, tourism and building productive capacities play major roles.
PAMELA COKE HAMILTON, presenting the Secretary General’s report on international trade and development (document A/73/208), said the erratic performance of trade over the past five years has been at odds with previous trends. The forecast for 2018 is that trade will grow by 4 per cent, but current trade tensions and development challenges have been compromising this estimation. Global foreign direct investment (FDI) fell by 3 per cent in 2017 and trade tensions could further reduce that figure. Least developed countries should have a share of 2.2 per cent of global trade by 2021, but recent trends are causing them to fall far behind, which could compromise aspects of the Sustainable Development Goals.
As two thirds of developing countries are commodity dependent, she continued, trade tensions are having a detrimental effect on them. The multilateral trading system is being stretched and its credibility is under threat. It is being seriously affected by localization of production and the dismantling of value chains. Challenges to multilateral cooperation anywhere is a challenge to achieving the Goals. The departure of big trading nations from multilateral cooperation will affect various areas, including global efforts to combat climate change and reduce poverty.
NEIL PIERRE, Officer in Charge of the Financing for Sustainable Development Office, Department of Economic and Social Affairs, introduced the report of the Secretary-General on international financial system and development (document A/73/280). Stating an effective and stable financial system is necessary for allocating resources for sustainable development needs, he noted that reforms following the global economic crisis have helped reduce risks in the financial system. However, other risks, including cross-border capital flows, shadow banking and debt, are rising in areas outside of regulatory frameworks, caused by monetary tightening, rising trade tensions and uncertainty around multilateralism.
Primarily in private capital, developing countries recorded capital outflows of $432 billion in 2016 and $255 billion in 2017, with the lower number reflecting outflows to China, he said. FDI flows to developing countries have remained stable. However, he noted, these figures do not capture daily volatility or market volatility affecting some emerging market currencies since early 2018. In public financial flows, the World Bank will raise annual lending to $100 billion in 2030 compared to $59 billion in 2017.
In the second section of the report, he addressed a pressing need to reorient the financial system to support financing sustainable development. Nationally, sound macroeconomic policies for the Sustainable Development Goals must be complemented by effective financial regulation, macroprudential measures and capital account management. National policies also need to be supported by an international enabling environment, with the need for a global financial safety net. He added that greater macroeconomic policy coordination will be crucial as the world moves by default to a multi currency reserve system. Ultimately, if the international financial system is to better support sustainable development, global economic governance structures should evolve to fit the new era.
STEPHANIE BLANKENBURG, Chief of the Debt and Development Finance Branch, Division on Globalization and Development Strategies, United Nations Conference on Trade and Development (UNCTAD), presented the Secretary General’s report on External debt sustainability and development (document A/73/180). Outlining debt trends from 2008 to 2017, she noted that total external debt stocks of developing countries and economies in transition have outpaced economic growth. Total external debt stocks of developing countries are estimated to have reached $7.64 trillion in 2017, having grown at an average yearly rate of 8.5 per cent between 2008 and 2017. Total external debt to gross domestic product (GDP) has deteriorated from 21.2 per cent in 2008 to 25.7 per cent in 2017. Debt service to exports ratio continues on its upward trend, although in years when commodity prices recover, this burden is slightly reduced.
These aggregate figures mask growing financial and debt distress in various regions, she said. For least developed countries, total external debt stocks rose to $293.4 billion in 2017, representing an average annual growth rate of 7.4 per cent over this period. While the total external debt to GDP ratio barely changed over the last decade, both the debt service to exports and as a percentage of Government revenue ratios more than doubled, diverting resources away from key social projects aimed at attaining sustainable development targets. Some 40 per cent of low income developing countries, or about twice as many as in 2013, are now at a high risk of debt distress. Small island developing States are another well known hot spot of distress. The total external debt stocks of these nations have more than doubled between 2008 and 2017 while GDP increased by just over 30 per cent during this period.
The overall outlook on external debt sustainability in developing countries remains worrying and is set to deteriorate further in the near future, she said. Conventional broad statistical indicators of external debt sustainability, such as GDP to external debt rations, are increasingly inadequate to capture the growing complexity of financial and debt vulnerabilities in developing countries, given their fast integration into international financial markets over recent years. Of particular concern are the massive build up of non financial corporate debt, including in emerging market economies, the renewed external financial fragility of a several upper middle income countries and the continued deterioration of external debt sustainability in a growing number of least developed countries and small island developing States.
MOHAMED EDREES (Egypt), speaking on behalf of the Group of 77, said international trade is an important tool for financing development, achieving inclusive economic growth and eliminating poverty. The Group reaffirms the significance of a universal, rules based, open, transparent, predictable, inclusive non-discriminatory and equitable multilateral trading system under the World Trade Organization (WTO). Meaningful trade liberalization can stimulate development around the world. It is very concerning that the Doha Development Agenda has not been concluded and it encourages WTO members to strengthen special and differential treatment for developing countries and address the imbalances and inequities of the current global trading regime, he said.
He said the Group calls on the international community to strengthen cooperation to combat illicit financial flows in all its forms and ensure the return of assets to the countries of origin in a timely manner, in line with domestic and international law. Furthermore, it reiterates the need to strengthen international cooperation on tax matters, recognizing with concern that there is still no single global inclusive forum for international tax cooperation at the intergovernmental level. The Group reaffirms the need to fully upgrade the Committee of Experts on Tax Matters to an intergovernmental body with experts representing their respective Governments. In addition, it repeats that financing for development should focus on channelling resources to eliminate poverty, the 2030 Agenda for Sustainable Development’s overarching goal. The Group reiterates the importance of the resolution on Follow up to and implementation of the outcomes of the International conferences on Financing for Development as a key tool to provide policy guidance from the General Assembly on the process of following up to the third Conference on Financing for Development, adopted in Addis Ababa in 2015.
INA HAGNININGTYAS KRISNAMURTHI (Indonesia), speaking on behalf of the Association of Southeast Asian Nations (ASEAN) and aligning herself with the Group of 77, noted the world economy showed growth of 3 per cent in 2017 and expects growth to remain similar throughout 2018 and 2019. The combined 2017 ASEAN GDP was $2.8 trillion, with growth stable at 5.2 per cent going forward. That steady progress has meant declining extreme poverty, improved access to health services and water resources, and 95 per cent access to education at the primary level. She stated the Association’s agenda includes goals to strengthen regional stability against external shocks, narrow the development gap and enhance digital connectivity. Sustainable development will require assisting those areas lagging behind in eradicating poverty. Global leadership and multilateralism must improve access to development financing, capacity building and technology, with private sectors, domestic and international, joining a progressive synergy in line with the Sustainable Development Goals. Calling on developed countries to fulfil their official development assistance (ODA) commitments, she said that domestically, digital financing and financial literacy must be enhanced, particularly for women and girls, farmers and micro-, small and medium sized enterprises.
PERKS MASTER CLEMENCY LIGOYA (Malawi), speaking on behalf of the Group of Least Developed Countries, stressed that product diversification, connectivity and trade facilitation can boost least developed nation exports in the global market. He also noted that the growing digital economy presented a new challenge for the Group, as only 2 per cent of people in least developed countries are able to shop online. Stressing that these nations needed strong support from development partners, he called for full and timely implementation of all decisions made at United Nations conferences in favour of least developed countries, especially those relating to taxation, market access and cotton.
He also expressed grave concern that the ratio of debt service to exports increased to almost 10 per cent in 2017. This is partly attributable to increased borrowing, but least developed countries also have higher debt service costs as well as lack of access to ODA and concessional lending. Debt servicing is taking away much needed resources that could be used in achieving the Sustainable Development Goals. Lack of progress to fulfil aspects of the Addis Ababa Action Agenda is also worrisome. Noting that here has been some rebound in the flow of ODA, he called on development partners to provide at least 0.2 per cent of gross national income to developing countries.
DIEDRE MILLS (Jamaica) speaking on behalf of the Caribbean Community (CARICOM), said the decline in correspondent banking relationships remains a key concern for her group. CARICOM welcomes the attention given to the issue by the Outcome Document of the 2018 Economic and Social Council forum on financing for development follow up and is pleased the Inter Agency Task Force on Financing for Development is mandated to continue to monitor, as part of its 2019 report, the decline in correspondent banking and its impact. CARICOM welcomes the attention being given to debt vulnerability. A key challenge for developing countries in maintaining external debt sustainability has been their hastened and frequently premature integration into rapidly expanding international financial markets. The related increase of private lenders and private corporate borrowers in developing country external liabilities, alongside a growing shift towards bonds rather than bank related finance, is also concerning.
The devastation caused by the 2017 Atlantic hurricane season demonstrates the environmental vulnerability of small island developing States and exacerbates their unsustainable debt burdens, she continued. There is a need for a more systematic and coordinated approach to financing successful climate change adaptation and supporting external debt sustainability and fast recovery after environmental shocks. Greater coherence is needed between global economic policymaking and global trade governance, which should be aligned with the objectives underpinning the Sustainable Development Goals. A revitalized multilateral trading system with improved credibility and relevance is needed to meet future challenges. A multilateral trading system is an essential public good and provisions should be maintained for special and differential treatment, so trade can contribute to broad based development and reduce inequalities among and within countries.
ASHISH SINHA (India), associating himself with the Group of 77, said that the current global economic outlook requires the promotion of policies that enhance growth and promote investment. Partnerships must focus on encouraging longer term investments, including FDI, in critical sectors such as transportation, agriculture, energy and infrastructure. He also expressed support for the multilateral trading system, adding that WTO should remain the cornerstone of a rules based, open, transparent and inclusive trading system. He outlined various national programmes spotlighting that his country had implemented the world’s largest financial inclusion scheme which has resulted with 320 million Indians opening bank accounts. This has also enabled the poor to receive vital Government benefits and has significantly reduced waste and corruption.
FARZANA ZAHIR (Maldives), speaking on behalf of the Alliance of Small Island States and associating herself with the Group of 77, said that while the Second Committee is the primary forum for providing guidance on global finance and economic matters, there is a need to work closely with other entities. Closer interactions with financial regulators, regional commissions and other relevant bodies will provide targeted and actionable political guidance. Pointing to increasing trade tensions and unstable financial markets, she said small island developing States are the first to feel the effects of external economic and environmental shocks.
International trade is a critical aspect of economic growth for small island developing States, she stressed, also calling for a fair and rules based multilateral trading system that rejuvenates global trade and growth and is economically, socially and environmentally sustainable and inclusive. She reaffirmed the centrality of WTO to the multilateral trading system and expressed concern over the lack of progress on the issue of fisheries subsidies. Debt distress is among the most severe challenges for small island developing States, she noted, pointing to the Secretary General report findings that show debt stocks in those States have more than doubled since 2017.
OMAR HILALE (Morocco), speaking on behalf of the African Group and associating himself with the Group of 77, said the multilateral economy is crucial to macroeconomic policy and regional development. All countries must resist the tendency to turn inwards during hard times, as protectionist policies harm the international community, particularly in Africa. Macroeconomic policies emplace the economic environment essential to implementing the 2030 Agenda, and there is no doubt Africa suffers most from external shocks. Stronger regional cooperation is needed. Saying the Africa Continental Free Trade Agreement will boost regional trade and enhance economies of scale, he noted that the continent is an attractive market with a growing middle class.
HA�CTOR ENRIQUE JAIME CALDERA�N (El Salvador), speaking on behalf of the Community of Latin American and Caribbean States (CELAC), expressed concern that recovery in global and regional economies had not been shared among all countries and sectors. There are still specific challenges faced and structural problems aggravated by the reduced access to concessional finance, especially for middle income countries and nations in transition. Stressing the importance of ODA for countries in his region, he called on developed countries to fulfil their development targets. He also underscored the importance of implementing multidimensional methodologies agreed on between Governments to measure a country’s level of development, with the aim of defining adequate criteria to allocate ODA.
Shareholders in multilateral development banks and international forums should develop graduation policies that are sequenced, phased, gradual and adapted to the particular situations of each country, he said. Multilateral development banks should also explore ways to ensure their assistance best addresses opportunities and challenges presented by diverse circumstances in developing countries, including those in Latin America and the Caribbean. Developing countries should attach importance to scaling up international tax cooperation and combating illicit financial flows to mobilize domestic resources for the Sustainable Development Goals. His region recognizes the importance of eliminating safe havens that create incentives for the transfer abroad of stolen assets and illicit financial flows. He stressed the importance of disclosure practices and transparency in both source and destination countries, including in financial transactions between Governments and companies for relevant tax authorities.
OMAR ALSHAMES (Libya), associating himself with the Group of 77 and the African Group, said international trade is the engine of macroeconomic growth. However, the world needs a global trade system that is multilateral and just. International financial institutions must be fairer and more responsive to individual national needs. Just as crucial, he said, they must refrain from imposing politicized conditions. Noting that developing countries continue to experience external shocks due to the flux in prices of commodities, he noted that despite its difficult current situation, Libya has enacted new reforms to help its people and achieve sustainable development targets, with the assistance of the United Nations. His country calls for the international community to help it recover assets from countries to which Libyan funds have illicitly flowed.
Mr. DAVIES (South Africa), associating himself with the Group of 77 and the African Group, said it is clear the Sustainable Development Goals will not be realized without adequate funding. Financing for development is not a luxury, but a prerequisite to attain a better world to live in. Stressing that the international community should work harder to achieve the 2030 Agenda targets, he expressed concerned about the funding gap and lack of North South cooperation. Adding that the infrastructure gap is also worrisome, he urged the international community, including the private sector, to take an interest in infrastructure development in Africa. It should also promote a rules-based equitable and transparent trading system. There is a need for more meaningful trade access for developing countries through WTO.
Mr. MASLOV (Russian Federation) said all countries face new challenges as geopolitical tensions rise, with the gap between developed and developing countries increasing. Fiscal stimulus has morphed into significant budget deficits, so the international community should take an in depth look into the global financial system, where the interests of all must be considered as opposed to narrowing nationalist purposes. Meanwhile, his Government increased its international development contribution to $1.2 billion in 2017. WTO must continue to function as the universal foundation for international trade. The Russian Federation is concerned over WTO deadlock in multilateral negotiations, and the increasing politicization of international trade, coercive measures, sanctions, trade wars and barriers, which run counter to economic sense, also affecting human rights. The Russian Federation, he said, will not create barriers, believing in an open transparent global trade system considering the benefit of all. The countries of the Eurasian Union � the Russian Federation, Belarus, Armenia, Kazakhstan and Kyrgyzstan � are creating conditions for the sound flow of trade and economy.
MYRIAM OEHRI (Liechtenstein) said corruption continues to hinder sustainable development and undermine human rights as well as fundamental freedoms. Provisions of the United Nations Convention against Corruption regulating the recovery and return of stolen assets are diligently and carefully crafted. The concept of return of assets under the Convention should not be mixed up with other forms of international cooperation, especially with illicit financial flows. Such illicit flows are not limited to stolen assets, but may instead also encompass proceeds stemming from organized crime � drugs and arms trafficking, human trafficking, transfer mispricing or undeclared offshore wealth. Different components of illicit financial flows call for separate and distinct analyses to inform the design of effective policy responses.
Mr. SAMIR (Iraq), associating himself with the Group of 77, said global partnership requires a meaningful, prosperous multilateral trade environment. Countries suffering from war and the scourge of terrorism, including Iraq, are in need of development financing, and international trade is important to that development, providing opportunities for sustainable development, creating jobs and boosting the standard of living. Noting that Iraq is in a transitional phase, he insisted the country aims to be open to the international economy. An observer State to WTO, Iraq is negotiating to become a full member, which would integrate its economy into the global one. His nation faces challenges in reconstruction after its victory over Islamic State in Iraq and the Levant (ISIL/Da’esh), having been hit by the double economic shock of the war on terror and lower oil prices, leading to a huge budget deficit. The country enacted reforms to stabilize the Iraqi dinar and is cooperating with international institutions to overcome its financial crisis, but foreign external debt obstructs economic activity and must be cancelled.
Ms. MENDOZA (Mexico) said the new paradigm laid down by the 2030 Agenda means the Second Committee must base its resolutions on action to achieve development goals. It must support a multilateral trading system promoting sustained economic growth. Strengthened international cooperation is imperative in dealing with inequality and development. The international community must foster greater financial inclusion, which must also consider migrants and their contribution to countries of origin and destination. Adding that disaster risk reduction is also a key part of sustainable development, she said increasing resilience to natural hazards can accelerate attainment of the Sustainable Development Goals.
Mr. RZHEUSSKY (Belarus) said international trade is an engine for economic growth, poverty eradication and achieving sustainable development, but in itself is not enough. Trade must also be inclusive. Stating that a rising world economy is great, he said that wealth must be distributed better. He also noted risks for the future in greater geopolitical tension, necessitating that multilateralism be strengthened. Observing that UNCTAD is more important than ever before to trade, development and development financing, he said it is time for the United Nations to acknowledge middle income countries. There are now over 100 of them, holding most of the world’s people, generating a third of the world’s GDP and a quarter of its exports and imports. They are crucial to achieving the Sustainable Development Goals. Noting Belarus’ membership in the Eurasian Economic Union and its development of stable trade in the Eurasia space, he also said his country wants to participate in WTO. Meanwhile in the broader sphere, he criticized unilateral economic coercive measures as counterproductive to the international trading system.
LEILA CASTILLON LORA SANTOS (Philippines), associating herself with ASEAN and the Group of 77, underscored her country’s support for a multilateral trading system with WTO at its centre. She emphasized the urgent need for a global approach to reducing international financial vulnerabilities, as well as the need to recognize and differentiate the financial risks of countries and regions. Emerging risks must be constantly monitored as well. Stressing the need for a long term holistic financing strategy to make the most of Government resources for achieving the Sustainable Development Goals, she said the Philippines is undertaking comprehensive tax reforms, including higher sin taxes, excises taxes on sugar sweetened beverages, and levies on the purchase of automobiles and fuel. She went on to call for more substantive discussion and international cooperation on combatting illicit financial flows.
PAN JINGXUAN (Singapore) said national efforts to develop can only succeed if they are supported by a conducive global economic system. Today’s volatile economic conditions pose both a short-term challenge to domestic priorities like jobs and growth, and a long-term threat to development goals. Rising trade tensions and barriers will disrupt value chains and business models, affecting industries, countries and workers. The international community should strengthen and improve the multilateral system, as economic output and trade are deeply integrated. Free trade is also vital, he said, noting that both developed and developing countries have benefitted from access to new markets, foreign investments and growth in global demand since the Second World War. Nations should also respect international law, adopting an open, inclusive, transparent, rules based global economic system, which provides all countries with a predictable environment and framework to develop.
RODRIGO ALBERTO CARAZO ZELEDA�N (Costa Rica) acknowledged the gradual efforts to turn the political commitments of the Addis Ababa Action Agenda into actual measures to strengthen the global environment and providing the financing it requires � generating the opposite response to mobilizing domestic resources in developing countries, without addressing their limited ability to capture them. This requires transparent governance that is corruption free. Turning to the economic empowerment of women, he noted that incorporating them into the labour market contributes to society at multiple levels, in which the Second Committee plays a major role. It is important to take a multidimensional view of development, where the international community and particularly the United Nations would respond better to the obstacles that countries face, one of which is using per capita income criteria as the major measuring rod for development.
Ms. YUKTADATTA (Thailand), emphasizing the need for free and fair trade in realizing the Sustainable Development Goals, expressed concern with escalating protectionist sentiments and tensions exposing trade dependent countries to negative impacts impeding their development. Bilateral, subregional and regional trade and economic integration are vital building blocks to multilateral trade cooperation. They bolster developing countries’ capacity to pursue a trade agenda at broader levels and adapt to emerging trends, including digital and services trade as well as trade in environmental goods. He also underscored the need for an open, fair and inclusive international financial system, the importance of ODA, domestic resources mobilization through good governance and innovative financing solutions through partnerships with all relevant partners.
Mr. AL-MAHMOUD (Qatar) stated that today’s volatile economic environment requires vision, especially for developing and least developed countries. Asking for a multilateral trade system based on rules and openness, he said the international community must face the challenges of financing motivated by a sense of partnership and cooperation. His Government is committed to working at the international level to face the joint challenges of sustainable development. However, unilateral measures taken for political reasons run contrary to that spirit and to the United Nations Charter and international law, demanding that his country deploy tremendous effort to counter them to maintain the viability of the State.
OMER DAHAB FADL MOHAMED (Sudan), associating himself with the Group of 77 and the Group of Least Developed Countries, said international trade can bolster sustainable development and economic growth, and can also be an important source of financing for development. The international community needs a multilateral, rules based and transparent trading system, one that is predictable and non discriminative. Challenges facing developing countries in their efforts to develop include infrastructure, communications technology, financing, and foreign debt, which is among the bigger obstacles to achieving economic and social development. Noting that foreign debt in Sudan has lowered rates of human development and hindered the benefits of ODA, he called on the international community to live up to its commitments. The risks of a potential new round of debt crises and economic upheaval are a great challenge in achieving the Sustainable Development Goals.
FADUA ORTEZ (Honduras), associating herself with the Group of 77 and CELAC, stressed the need to improve the international financial system to achieve an environment conducive to realizing the 2030 Agenda. She said that her country lacks access to concessional financing and has fewer opportunities to obtain resources needed to fund development. Middle income countries are in the category of more developed nations, but still face problems of poverty and possess a fiscal margin that is insufficient to achieve the Sustainable Development Goals. She also stressed the importance of working jointly to provide new access to financing and trade for small producers that recognizes their contribution to the global economy.
ALADE AKINREMI BOLAJI (Nigeria) said facilitation of access to financial resources and technology, innovation, capacity building and fairer international trading and financial systems are critical to enabling those in need. The path to sustainable economic prosperity is through the diversification of the economy. He noted that ODA has long been a major contributor to development for many nations. It is the main channel for international cooperation and will continue to remain so. Nigeria, like most developing countries, has concerns that over the years the total amount of ODA from developed countries is still far below the target of 0.7 per cent of gross national income, with some donor countries shifting more ODA to funds for hosting and processing refugees within donor countries in recent years. This shift in ODA resources towards humanitarian and crisis situations is inconsistent with a long term and sustainable approach to financing development needed to achieve the 2030 Agenda targets.
LOK BAHADUR POUDEL CHHETRI (Nepal), associating himself with the Group of 77 and the Group of Least Developed Countries, said that the trade deficit is getting worse for many least developed nations. This plight is further aggravated by low preferential market access in key sectors. Least developed countries which are also landlocked or small island face even more challenges. The resource gap is huge, he added, stressing that commitments are not faring well in regards to implementation of the 2030 Agenda. Increasing trade tensions hurt developing countries most. He said that the early conclusion of the Doha Development Round of trade negotiations is in the interest of all WTO members. It is also important to enhance financial and digital literacy. A short term horizon of investment cannot propel the raft of sustainable development, he added, emphasizing the need to encourage more FDI in key infrastructure development. Development partners must also comply with their ODA commitments.
CRISTIANE ENGELBRECHT SCHADTLER (Venezuela), associating herself with the Group of 77 and CELAC, noted that the global economy grew by 2.7 per cent in 2017, according to the World Bank. However, major risks are generated in the midst of unprecedented protectionist measures, which will weaken growth and create financial turbulence. More than ever, she said, we need multilateralism, based in social justice, as the way forward to creating a new economic order. Financial structures require a democratization of decision making mechanisms. Crucially, unilateral coercive measures of an economic, financial and commercial nature, such as the ones on her country, do not benefit economies or development, and the international community must therefore take action to remove them. In financing, she said donor countries must honour their ODA commitments to guarantee operational development activities, without condition or restriction.
A representative of Maldives, associating with the Alliance of Small Island States and the Group of 77, noted that their nation has maintained a sustained growth trajectory and is committed to maintaining it by strengthening economic fundamentals, institutional capacity and improving governance structures. As a result, the country has earned favourable credit ratings from international agencies. However, challenges unique to small economies remain, including geographical isolation, the cost of capital investment and the specialized nature of the economy. As a result, the Government is investing in modernizing critical infrastructure including airports near key population centres in the atolls. The runway at the main airport was recently expanded, and a few weeks ago, a bridge connected the capital city Male with the reclaimed suburb of Hulhumale.
FRANCISCO TENYA (Peru) said his country faces challenges common to many nations like climate change, natural hazards and large scale corruption, which could endanger progress that has been achieved. Peru favours policies of openness and has been promoting measures to enhance public and private investment, which has allowed it to achieve a higher growth rate in 2018. Its development policies are mainly focused on education health and infrastructure. He stressed the need for international trade and the avoidance of protectionist measures in meeting development goals.
MOHAMMED BESSEDIK (Algeria), associating himself with the Group of 77 and the African Group, said the Addis Ababa Action Agenda and implementation of the 2030 Agenda will have tremendous importance for the future of his people. In that context, responsibility should be shared rather than subject to unilateral decisions, which could lead to hunger for hundreds of millions of people. Hence, reform is needed to improve global economic architecture to guarantee geographically equitable representation. Clearly, every country is responsible for its own social and economic progress; however, development efforts require a favourable economic environment. The deterioration of terms of trade marked by the collapse of commodities prices, and the crisis of external debt are of great concern. He stated that debt must be kept at supportable levels, and creditors must lend in such a way as to not compromise the viability of that debt.
Mr. BILAN (Ukraine), emphasizing that global trade plays a key role in supporting inclusive growth and sustainable development, said a multilateral trading system is a great policy instrument that can help to further integrate developing countries into the global market. For its part, Ukraine has been implementing a range of efforts, including fiscal decentralization, gender responsive budgeting and reforms on the tax system and social welfare. Already achieving results, Ukraine’s GDP has grown by more than 3 per cent in 2018. Such efforts will complement Ukraine’s national strategy to achieve the Sustainable Development Goals and are already leading to the economy’s stabilization and growth. More broadly, Ukraine applies bilateral and multilateral systems and maintains a close relationship with the International Monetary Fund (IMF) and other international financial institutions.
LU YUHUI (China) said international trade should be based on an open world economy with a multilateral trading system based on WTO to handle disputes. All nations should share the benefits of globalization, promote economic restructuring and encourage the e economy. Corruption, organized crime and tax evasion have a serious impact on developing countries in their efforts to realize the Sustainable Development Goals. He stressed that the global community should continue to strengthen international cooperation, especially financing for development, which is an important source of resources for development in developing countries.
VILIAMI VA’INGA TONE (Tonga), associating himself with the Group of 77 and the Alliance of Small Island States, said that as a small island developing nation, his country values the strong and durable partnerships it has established with development and donor partners. He highlighted Tonga’s recent and ongoing progress in securing financing for development. This includes domestic resource mobilization and international development cooperation in support of climate and disaster resilience. Effective, predictable and long term availability of adequate resources for sustainable development has been challenging at the global and national levels. He recognized the need for improved and strengthened fiscal and monetary policies and frameworks which support the implementation of national development plans and strategies. Financial inclusion is central to the creation of equitable societies and necessary for the achievement of the 2030 Agenda. He also spotlighted the role of small and medium sized enterprises in contributing to Tonga’s economic prosperity.
Ms. HAMDOUNI (Morocco), associating herself with the African Group and the Group of 77, said achieving sustainable development requires positive macroeconomic policies, international financial stability and a multilateral commercial system. Her Government is convinced that trade liberalism benefits growth, reaffirming its commitment to open, fair, equitable and universal multilateral trade. Stating that ODA remains a cornerstone for financing and implantation of the Sustainable Development Goals, she called on developed countries to enact their commitments, as global and cross cutting challenges demand solidarity. Over the last two decades, Morocco has enhanced cooperation with African States in the financial and commercial spheres, setting up a legal framework with over 500 agreements with 40 countries.
KHAMPHINH PHILAKONE (Lao People’s Democratic Republic), associating himself with the Group of 77, ASEAN and the Group of Least Developed Countries, said Nations in special situations face serious challenges. These include commodity price volatility, low productive capacity and non diversified export structures typically concentrated on few bulky agricultural and extractive commodities. This renders these countries highly vulnerable to external shock. Countries in special situations with the combined population of more than half a billion people should not be left behind, he stressed. His Government continues to expand its trade and economic cooperation with other countries and regions.
GEBEYEHU GANGA GAYITO (Ethiopia) said progress is uneven in implementing the Addis Ababa Action Agenda. To ensure its implementation and realize global partnerships, developed countries should honour their pledges. He stressed the need also to engage with the private sector to mobilize resources aligned with the Sustainable Development Goals. As these targets provide a long term business opportunity, building productive public and private partnerships will be a win win approach. Ethiopia has developed a road map to implement the Action Agenda and continues to ensure the capacity to mobilize resource and, fight tax evasion and illicit financial flows. While the Government has continued to mobilize resources, it is also faced with rising debt, and impediments to finance.
YEMDAOGO ERIC TIARE (Burkina Faso), associating himself with the Group of 77, Group of Least Developed Countries and the African Group, said his country has experienced economic growth, but that the security situation is troubling and must be improved. All financial levers must be used to help the country. Protectionist measures are being taken that are hurting its economy. Innovation and financing are needed by multilateral organizations to help the country, and he urged IMF to alleviate the financial conditions imposed on Burkina Faso.
PHILIP FOX DRUMMOND GOUGH (Brazil) said the global economy is giving signs of recovery and investment is picking up after a long period of reduced growth. However, there are considerable political risks that need to be addressed in all their complexity, including growing discontent with globalization and the adoption of self centred national policies. Failure to address economic challenges like raising inequalities, within and among countries, will have further destabilizing effects on long term development. On the international financial system, further steps need to be taken to reform global governance and increase representation of developing countries. The deterioration of external debt positions in many developing countries also needs collective attention as well as the effects of current monetary adjustments that could instil volatility in developing markets. The resolution on illicit financial flows addresses one of the most crucial issues of our times and needs to be confronted through committed cooperation between source, transit and destination countries.
Mr. AMOLO (Kenya), associating himself with the Group of 77 and the African Group, said his nation has built its economic prosperity through the management of economic fundamentals which include managing inflation and tight fiscal management by the country’s Central Bank. To enhance social gains, Kenya has prioritized the Big 4 Agenda with the objective to enhance manufacturing, provide universal health coverage, provide affordable housing and safeguard food security and nutrition. The African Continental Free Trade Area Agreement is good for the continent and will provide economic benefits to the region by providing a single continental market for goods and services with free movement of business persons and investment.
Mr. CHINMOUN (Cameroon) stressed that subsidies and non tariff barriers in international commerce are contrary to WTO regulations. South South cooperation should be strengthened with a view to increasing production and achieving the goals of the 2030 Agenda through international trade that will be effective for development. All countries should work towards alleviation of developing country debt as well as a more just and inclusive international financial system. Developed countries should shoulder their responsibility for development by funding the development agenda pursuant to the Addis Ababa Action Agenda.
NEVILLE MELVIN GERTZE (Namibia), associating himself with the African Group and the Group of 77, said his country is not immune to external economic shocks and that falling commodity prices have slowed down economic growth. Namibia is responding by strengthening domestic resource mobilization mechanisms, he said. The country is addressing inequality � which stems from the apartheid era � by diversifying the economy towards labour intensive sectors to induce growth. Voicing concern over the rise in protectionism, he called for greater assistance for developing countries to avoid unsustainable debt build up. International trade is an essential component of modern societies, he stressed, adding that his country advocates for a non discriminatory multilateral trade system under WTO. Developing new financing ideas and technologies through dialogue can build bankable partnerships along South South cooperation.
CHRISTINE KALAMWINA (Zambia), associating herself with the Group of 77 and the African Group, credited her country’s recent economic growth to improved performance in mining, manufacturing, electricity generation and public administration. However, trade tensions between major economies pose a threat to economic growth, she warned, adding that Zambia is aware of its need to address the high risk of its debt. The Government has indefinitely postponed the contraction of pipeline debt to bring the level of debt to a moderate risk of distress. In response to the impact of illicit financial flows, Zambia is implementing its Public Finance Act to create an institutional and regulatory framework to better manage public funds. She said Zambia is implementing measures to promote financial inclusion and the growth of small businesses. She called for the strengthening of the international financial system and for accelerated implementation of the Addis Ababa Action Agenda.
Ms. SARRESTANI (Iran), associating herself with the Group of 77, said inclusive and accessible international trade is vital to the development agenda as embodied in the Sustainable Development Goals. States must promote multilateralism in the field of trade and economic cooperation, she said, adding that the multilateral trading system is in crisis. She said Iran faces unjust sanctions intended to target its economy that also carry destructive implications for the international financial and economic system. Iran is resorting to a policy of resistance economics to counter the effects of irresponsible unilateral actions, she noted, adding that developing countries are defending the principles of multilateralism. As an acceding country to WTO, she said Iran believes the accession process must be accelerated without politicization.
DANIEL FERNAN GIMENEZ (Norway) said his country has played an instrumental part in the development of the Addis Abba Action Agenda. ODA is important and must be mobilized to help developing countries, he said, noting that his country has contributed significantly to development. The international community must work to unleash new forms of financing for developing countries. A more equitable and fair tax collection system is necessary. Another important issue is addressing illicit financial flows around the world. This is a core developmental issue. Integrity and transparency are needed. An open rules based system of trade is needed to help the global economy. The 2030 Agenda can only be reached with the greater participation of women.
BERNARDITO CLEOPAS AUZA, Permanent Observer of the Holy See, noted two sobering realities about the current global environment. First, there is a basic fragility for most developing countries regarding positive economic growth trends experienced in 2017, which can be quickly reversed. Second, least developed countries, including small island States, remain particularly vulnerable to downturns in the global financial environment as well as the effects of climate change. Concerted steps should be taken to reduce these vulnerabilities to prevent these countries from being left further behind in pursuit of the 2030 Agenda. Least developed countries, most of which are dependent on commodity exports for their foreign exchange earnings, will also eventually need structural changes to reduce their vulnerability to external price shocks. Such changes, however, will take time. In the meantime, their lack of access to international markets will continue to be a barrier to increased export earnings.
Carla Mucavi, of the Food and Agriculture Organization of the United Nations (FAO) Liaison Office, said that climate change will have an increasingly adverse impact on many regions of the world, with those in low latitudes being hit the hardest. International trade has the potential to help countries adapt to climate change in the context of food security, by stabilizing markets and reallocating food from surplus to deficit regions. But that will not happen automatically, and work must be done to ensure that the evolution and expansion of agricultural trade is equitable and works for the elimination of hunger, food security and malnutrition globally. The new edition of her agency’s flagship publication, State of Agricultural Commodity Markets, presents some of the key dynamics in agricultural trade. It highlights that trade can help balance food deficits and surpluses across countries, as well as contribute to domestic and international price stability. The report will be important for policymakers when formulating trade and related policies.
VINICIUS PINHEIRO, of the International Labour Organization (ILO), said the global unemployment rate in 2018 is projected to remain at a similar level to 2017 � 5.6 per cent with the total number of unemployed exceeding 192 million persons. Decent work deficits remain widespread and vulnerable employment is on the rise. Almost 1.4 billion workers are estimated to be in vulnerable employment. The ILO estimates that 600 million decent jobs will be needed in the next 15 years to achieve the goals outlined in the 2030 Agenda. He expressed concern that labour saving technologies could constrain the capacity of labour markets to generate sufficient jobs for the growing young population, leading to segmentation and worsening income inequality. Skills development, social protection, social dialogue, and occupation safety and health are essential components of the policy responses needed to shape a future of work. ILO has established the Global Commission on the Future of Work to undertake an in depth examination of the future of work, he added.
SYLVIA HORDOSCH, Policy Adviser, United Nations Entity for Gender Equality and the Empowerment of Women (UN Women), said to assess the impact of macroeconomic policies on females, the effects of public spending, tax policy and monetary policy on general equality has to be analysed. Well designed social policies can enhance macroeconomic growth and post crisis recovery through redistributive measures that increase employment, productivity and aggregate demand. One intervention, for example, would be mobilizing domestic public finance. Effective revenue collection combined with effective public service delivery can boost the link between people and their Governments. In its work on gender responsive planning and budgeting, UN Women provides ongoing technical assistance for countries to strengthen their tax and spending policies to be more responsive to women and girls. An approach to macroeconomic policy that systematically incorporates gender equality considerations is central to achieving sustainable development that is responsive to gender.
Source: United Nations