NITIN DESAI SAYS PREPARATORY COMMITTEE FOR CONFERENCE ON FINANCING FOR DEVELOPMENT MUST STRIVE FOR "CLEAR PRODUCT, MAXIMUM VISIBILITY"

Press Release
DEV/2246

NITIN DESAI SAYS PREPARATORY COMMITTEE FOR CONFERENCE ON FINANCING FOR DEVELOPMENT MUST STRIVE FOR ‘CLEAR PRODUCT, MAXIMUM VISIBILITY’

The Preparatory Committee for the High-level International Intergovernmental Event on Financing for Development must employ basic marketing principles to ensure maximum visibility for the conference, the Under-Secretary-General for Economic and Social Affairs said this morning.

Nitin Desai, addressing the Committee’s substantive session which began today, said the Preparatory Committee must express a clear view of where the event would take place and when, as well as what its agenda would be. “It will take a clear product to provide the basis for a strong outreach effort and project to the wider international community the importance of the issue of financing for development”, he added.

It was important to recognize that the financial systems of all countries were becoming increasingly linked because of the growing integration of world financial markets. While that issue had received attention, there was some value in identifying key areas of concern. The allocation of savings, and promotion of savings programmes that led to development, were also an important issue the Committee could address.

The Preparatory Committee is considering the modalities for the organization of the conference mandated by the General Assembly in its resolution A/RES/54/196.

Mauricio Escanero (Mexico), the facilitator of the “informal informal” consultations on the elaboration of agenda for the Event, introduced a first report based on the contents of the General Assembly resolution spelling out the topics, including financing for development, in a holistic manner in the context of globalization and interdependence.

A number of delegations, welcoming the efforts of the facilitator, also added their own inputs, including greater involvement of institutional stakeholders such as the World Bank, the International Monetary Fund (IMF) and the World Trade Organization (WTO), as well as the private sector.

Statements were also made by the representatives of Portugal (on behalf of the European Union and its associated States), Nigeria (on behalf of the “Group of 77” developing countries and China), Pakistan, Colombia (on behalf of the Rio Group), Ghana, Chile, Kenya, New Zealand, Guatemala, Japan, Norway, Indonesia, Lao People’s Democratic Republic, Saint Lucia, United States, Cuba and the Sudan. Representatives of two non-governmental organizations also made statements.

The Preparatory Committee will continue its deliberations in informal consultations. It will reconvene in an open session at a date to be announced.

Statements

JORGEN BOJER (Denmark), Co-Chairman of the Preparatory Committee, opening the session, said that it was a source of great satisfaction that the Committee had come this far and had reached a point where it was able to begin the work of the substantive session.

NITIN DESAI, Under-Secretary-General for Economic and Social Affairs, welcomed the deserved attention being given to financing for development, which was important to the growth of the entire international community. While the preparatory process and subsequent negotiations dealing with many new issues involved in financing for development would take time, it was important to note that the Committee had shown a great “spirit of innovation” in getting the process off the ground. In that same spirit, he said the Secretariat was prepared to offer its fullest support to ensure the success of the preparatory process and the high- level event.

Mr. Desai went on to address the Committee’s concerns about the degree of visibility of the event, and the extent to which the outside world was aware of the United Nations’ work in the area of financing for development. The very presence of many non-governmental organizations (NGOs) in the room today spoke to the fact that there was at least basic knowledge of the process. But the Committee must employ one of the basic principles of marketing to ensure the high- level event received maximum visibility; there must be a “clear product”. Such a product could only be produced if the Committee expressed a clear view of where the event will take place, when it will take place and what its agenda would be. “It will take a clear product to provide the basis for a strong outreach effort and project to the wider international community the importance of the issues of financing for development.”

He examined a few of the substantive issues in the area of financing for development which the Committee could take up, and which were not being dealt with properly in other United Nations forums. Some other areas of international financial cooperation which were important to the work of the Committee included the debt issue -– which could not be separated from discussion on sources for development; ensuring that the vast flow of private foreign investment could more directly benefit broader sections of the international community; finding a better way to identify the connection between trade and finance; and adequately addressing the concerns of developing countries on the issue of global financial management.

Finally, Mr. Desai said that it was important to note that the resolutions of the General Assembly had had an enormous effect not just in the work of the United Nations but also on the worldwide financial community. The General Assembly was responsible for much of the international policy in this area and was largely responsible for the inclusion of a “social” dimension in major financial policy. The challenge before the Committee, therefore, was to ensure that the current process had just as much or more positive impact on international financial sector policy.

MAURICIO ESCANERO (Mexico), “facilitator of the informal informal consultations” on the elaboration of the agenda for the event, reported on his consultations last Thursday. He said one of the main challenges facing the meeting was defining a preliminary agenda that would serve as a guideline for the Event. In keeping with his mandate, he had submitted the first draft of the agenda based on the outcome of the work of the open-ended working group of the General Assembly, which met last year, as well as the enriching debate in the Committee.

He said his agenda proposal was based on paragraph 3 of General Assembly resolution A/RES/54/196, which he quoted at length. The text said, among other things, that the high-level intergovernmental event in 2001 would address national, international and systemic issues relating to financing for development in a holistic manner in the context of globalization and interdependence. Within that overall context, it should also address the mobilization of financial resources for the full implementation of the outcome of major conferences and summits organized by the United Nations during the 1990s, and the implementation of the Agenda for Development, with particular reference to poverty eradication.

He said members of the Preparatory Committee had had an opportunity to reflect on his proposal. The Committee should now be able to take a decision that would allow it to forge ahead with its work.

NUNO BRITO (Portugal), speaking on behalf of the European Union and associated States, said the financing for development process should make a major contribution to mobilization and coherence in policies. It should also further the use of financial resources to achieve international development targets and full implementation of the outcome of the major conferences convened by the international community. The mobilization of all means and actors could be effectively achieved only by providing an enabling environment, including governance with human, social, economic and legal aspects.

The European Union welcomed the presence and active participation of the World Bank, and encouraged the participation of the IMF and the WTO in the process. The participation of the private sector and civil society was also encouraged. The forum would provide an excellent opportunity for the international community to hear proposals to enhance an action-oriented outcome to the preparatory process.

AUSTIN PETER OSIO (Nigeria), speaking on behalf of the “Group of 77” developing countries and China, said important issues such as information-sharing among all the institutional stakeholders needed to be addressed. It was very important for the work of the Committee to receive an update on the work of those institutions in all areas of financing for development.

Of utmost importance, he continued, was the need for resources. It was, therefore, essential, at the end of the substantive session this week, to prepare a report which would urge the Secretary-General to provide the necessary resources to carry the process forward.

SHAMSHAD AHMAD (Pakistan) said the pace and complex nature of globalization required sustained efforts to ensure that development remained the central objective of economic activity. All relevant actors should coordinate their policies towards the promotion of development. The United Nations could play a catalytic role in unleashing the potential of globalization to finance development.

The conference must enhance coordination among all relevant institutional and non-institutional stakeholders, he said, with due respect to their respective mandates and functions, in order to promote coherence and consistency in their policies. The role of the private sector could not be ignored. It must be asked to promote development to safeguard its own interest in larger markets. There must also be a call for justice.

The next Davos Forum in Switzerland, he continued, should be devoted to the subject of financing for development. A set of agreed principles, or a compact on financing for development emerging from the forum, could serve as a useful input for the final document of the 2001 event.

Pakistan envisaged a final document that included a political declaration. A programme of work, a political commitment for the realization of the objectives of the conference, and the establishment of a mechanism under United Nations auspices for an annual review of the implementation of the outcome were also essential.

ALFONSO VALDIVIESO (Colombia), speaking on behalf of the Rio Group, said the Group had a collective interest in the High-level Event on Financing for Development. [Members of the Rio Group are Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Guyana, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Uruguay, and Venezuela.]

Last September, with the support of the Economic Commission for Latin America and the Caribbean (ECLAC), the Rio Group had organized a regional high- level meeting in Mexico, with the theme “Towards a more stable and predictable international financial system and its link to social development”. In addition, they hoped to participate actively in the regional consultation that would be hosted by Colombia next November.

The Andean Corporation (Corporación Andina de Fomento-CAF) would assist Colombia in coordinating a group of high-level experts to prepare a number of in-depth papers covering the regional perspective on the clarified agenda for approval during the preparatory committee sessions. At the regional level, the Rio Group had discussed issues related to financing for development, comprising the active participation of various regional intergovernmental organizations.

The clarification of the agenda was a most relevant step in the preparatory process to which they were committed. The Rio Group expected that deliberations would be dominated by a productive, rich and visionary exchange of ideas. The definition of the agenda would guide the results of the regional consultation in Colombia. In addition, it would assure the value added of the activities that they would organize with the assistance of the Andean Corporation on the issue.

KWABENA OSEI-DANQUAH (Ghana) said it had become clear that the treatment of the issue of financing for development could not ignore the complexities of globalization and its impact on development. His delegation welcomed the emerging consensus on the question. The preparatory process and the event should create the opportunity for consideration -- for the first time -- of the conditions which would lead to optimum financing for development.

Close attention should be given to the issues of partnership between governments, the private sector and civil society. Attention should also be paid to the lack of mandated governance in areas of substantive linkage among the WTO, the World Bank and the IMF, and the need to strengthen the unique role of the United Nations in global governance.

The format of the of the final outcome of the event should be clarified at the earliest opportunity for a decision to be made on a multiple, flexible arrangement enabling major stakeholders, the private sector and civil society elements to participate effectively. He hoped both the WTO and the IMF would participate meaningfully in the intergovernmental level of the process, leading to an outcome all participants could own.

On the role of the private sector, he proposed three objectives that should guide the choice of participants for both the hearings and the final event. They included the need for a comprehensive dialogue on a possible regulatory framework for international market operations, particularly those of hedge funds; the examination of possibilities for public/private partnerships, as well as other ways of promoting private financial flows and investments. The committee should also define global values for and with the private sector, beginning with the Secretary-General’s proposal in Davos for a “Compact for the next century”.

Greater flexibility and innovation were required to involve civil society elements in the process, in a way that would lead to the coalitions critical to influencing policies for financing for development.

Mr. VALDES (Chile) said that the work carried out by the Committee was of the highest importance and in keeping with the will of the General Assembly. It was, therefore, necessary to reach a consensus among all the participants and stakeholders that would best address the issue of financing for development.

He went on to highlight some of the general elements which should be considered of great importance to the work of the current session: the process should be in line with the goals of all related United Nations high-level summits and conferences that had dealt with the development issue; the United Nations must include the issue of financing for development at the highest level in all its work in the coming year; all topics should be dealt with from a political perspective, using international guidelines; the issues of the world’s least developed countries must be considered fully in all discussion of financing for development; and the 2001 meeting should integrate all those ideas.

FARES M. KUINDWA (Kenya) said that since the only United Nations office in the developing world was in Kenya, his delegation strongly proposed that an upcoming high-level event be held there, at the United Nations Centre in Nairobi. In that context, on 1 May, the delegation had made a formal request that Nairobi be considered for the final event in 2001.

REBEKAH RILEY (New Zealand) said there was need for wider participation if coherence within financing for development was to be encouraged. The success of the event would, to a large degree, depend on the appropriate input from institutional stakeholders such as the World Bank, the IMF and the WTO. The role of official development assistance (ODA) in securing sustainable and equitable development was a concern in the process. The donor community, in partnership with developing countries, must continue working to use ODA in innovative and effective ways.

New Zealand placed considerable emphasis in its ODA programme on mechanisms designed to support its partner countries in their efforts to increase their resource mobilization opportunities. The needs and vulnerabilities of small island developing States required particular attention, she said. Their size, population pressures, limited domestic markets and narrow resource bases limited their scope for economic diversification. There was much that the international community could do to mitigate their vulnerability and assist their development.

New Zealand viewed the proposed agenda as a useful and flexible basis for the future discussions of the preparatory committee, regional commissions and technical working parties.

GERT ROSENTHAL (Guatemala) said there must be agreement to unify the theme that could provide context and coherence to the specific topics to be discussed. Finance constituted one of the major challenges to development, given its crucial role in stability, growth and equity. It should be noted that the objective of the Event was development, and not raising finance per se.

The special circumstances of the least developed countries, or States with special difficulties in mobilizing resources, should be treated as a horizontal theme.

The agenda should cover issues such as an enabling environment to foster domestic savings, and savings and investment at the global level; access to credit for micro-enterprises and promotion of global cooperation schemes in taxation matters, and the fostering of public awareness of the need to reduce volatility in transboundary capital movements.

KENJI HIRATA (Japan) said he would limit his statement to highlighting important criteria that should be considered in the Committee’s provisional agenda. It was his delegation’s view that the form and content of the agenda were critical for evaluating the important work that was to come.

First, he said that the agenda must be indicative rather that prescriptive or exclusive; no participant should be prevented from making his views known. Second, the agenda must attract participants rather than “scare them away”; it must be presented in a way that would encourage suggestions by institutional stakeholders, and that might possibly evolve from their active participation. Third, the agenda must provoke productive discussion and not stifle argument on any issues, no matter how sensitive. That point, he said, needed no further elaboration.

TORGEIR FJARTOFT (Norway) said the conference should give a new start to the development process. The rich industrialized countries must meet their ODA target of .07 per cent. The proposed agenda should be action-oriented. It was an essential building block in the development process, and must provide focus and direction. Proposals for the agenda would provide a good basis for discussion. The forthcoming hearings, particularly those involving the private sector, would be crucial.

MOHAMED HIDAYAT (Indonesia) expressed concern that no resources had been provided as yet for the preparatory process and the event itself. The meeting should take up that issue. The consultative process should be based on constructive dialogue. He hoped for an agreement on all modalities for the success of the event.

He announced that a regional consultative conference on finance for development would be held in Djakarta from 2 to 5 August. His delegation supported participation at the highest possible level in the main event next year. The venue for that conference should be determined early to ensure greater participation. There was need for a time frame to review its outcome.

ALOUNKEO KITTIKHOUN (Lao People’s Democratic Republic) said that the issue of financing for development was important for developing countries, in general, but for landlocked developing countries, in particular. The particular needs of those “geographically handicapped” countries required special attention. Because of those and other issues, he would be pleased to see the scope of the preparatory process enlarged to take account of them.

SONIA R. LEONCE (Saint Lucia) said that the high-level event on financing for development should have been the first United Nations development conference held. Now that a foundation had been laid, the development agenda would not only stand, but “rise and fly” to a level that was reflective of its importance to enhancing living conditions worldwide. “We are living in the best and worst of times,” she said.

Globalization had put on display high standards of living and promoted the joys of free spending and access to goods and services, but only a few could partake of such so-called benefits. The people of the developing world had begun to ask why this was so. The United Nations had an obligation to respond. The upcoming high-level event was the international community’s last chance to make the world a more equitable place for all people.

MICHAEL F. GALLAGHER (United States) said his delegation welcomed the participation of the Bretton Woods institutions at both the preparatory level and the main event itself. Their contributions would enhance discussions. He reiterated that the event should not touch on the autonomy of the Bretton Woods institutions. There was need for close consultations with stakeholders to ensure a meaningful agenda. The proposed agenda must focus on issues that struck a proper balance between domestic and international questions.

Ms. VALIENTE DIAZ (Cuba) said that her delegation supported holding the upcoming event at the highest level possible. Cuba also welcomed active participation from WTO, the World Bank and other international financial stakeholders. She proposed that important issues of debt, international financial flows and trade should be discussed in working groups that would then make contributions to a plenary meeting. That would allow for their in-depth analysis.

MUBARAK HUSSEIN RHAMTALLA (Sudan) said that the Preparatory Committee must identify the basis for further deliberations that would formulate the draft agenda for the upcoming Event. It was also important to confirm all agreements reached during the Committee’s 1999 sessions and meetings, consolidate those agreements, and vigorously pursue their implementation during the preparatory process. The agenda must stress the participation of international financial stakeholders such as the Bretton Woods institutions.

Statements from Non-governmental Organizations

Bro. IGNACIO HARDING, speaking on behalf of Franciscans International, the International Network of Catholic Development Organizations (CIDSE), Caritas Internationalis and Pax Romana, said that “the poor can no longer wait”, and that despite national and international efforts, marginalization of large sections of the population continued to increase. It was now obvious that policies to stimulate growth did not automatically improve income distribution. There was still a need for new and additional resources to provide faster debt relief for more countries, including a human development approach to debt sustainability.

Mechanisms were needed to ensure that resources coming from debt relief were used for people-centred development. The establishment of an international bankruptcy procedure could help achieve sustainable solutions to many of those problems.

Mr. TENNASSEE, of the World Conference of Labour, said that workers had been battling inequitable financial policies in the streets of the South for years, and his organization was concerned that many more developing countries would continue to be marginalized by unfair financial capital flows. To make matters worse, the role of international banks had been curtailed in some areas of their work; it was remarkable that finance ministers had to go to Washington in order to request increases in fund allocations for developing nations.

The upcoming conference must address the inefficient use of financial resources. There was a definite lack of leadership and the political will to address certain aspects of the development issue. As an example, he said that last year, when developing countries thought that “the world would come to an end” because of the so-called Y2K bug, an astonishing amount of money was allocated to research into a solution to the problem. “Why can’t we do the same thing to deal with poverty?” he asked. That should be of at least equal concern to the international community. The upcoming conference would provide a chance to bring back “sanity” to global financial policy-making and promote the elimination of poverty on earth.

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