PRESS BRIEFING ON FOLLOW-UP TO MONTERREY FINANCING FOR DEVELOPMENT CONFERENCE

PRESS BRIEFING ON FOLLOW-UP TO MONTERREY FINANCING FOR DEVELOPMENT CONFERENCE

Jose Antonio Ocampo, Under-Secretary-General for Economic and Social Affairs, briefed reporters at Headquarters today on a report by the Secretary-General concerning the follow-up to commitments made at the International Conference on Financing for Development, which took place last year in Monterrey, Mexico.

Thérèse Gastaut, Director for Strategic Communications Division in the Department of Public Information, introduced Mr. Ocampo.

The report by the Secretary-General addressed a complex agenda, said Mr. Ocampo, especially as it related to the inter-linkages between trade, aid, finance, institution-building and macroeconomic policies in the developing world.  Adding to the agenda’s complexity was the involvement of multiple stakeholders -- the United Nations, the World Trade Organization (WTO), the Bretton Woods institution, and the private sector, among others.

The Secretary-General’s report is one of several before the General Assembly today as it began a two-day high-level dialogue on implementing the Monterrey outcome.  That dialogue, said Mr. Ocampo, was one of “trying to see from the very multiple perspectives in what ways we have advanced, and how we can push forward the agenda”.

In terms of progress, the report stressed how the Monterrey conference had turned around the negative trend that official development assistance had been experiencing since the mid-1980s.  Last year, in fact, there was an increase of $5 billion, and the commitments made at Monterrey implied that that figure would increase to $16 billion by 2006.

“We, of course, will do regular reporting on how these commitments are met or not met, as an essential part of this follow-up process”, he said, adding, however, that the $16 billion commitment was much less than what was actually required to meet the Millennium Development Goals.  Currently, the World Bank and the United Nations estimated that $50 billion was a more precise figure.

According to Mr. Ocampo, the approval of the convention to combat corruption was a major success since Monterrey, as it was one of the main commitments made there and included assistance to nations to recover illicitly removed funds, a major demand by developing nations in the area of corruption.  Furthermore, the increased participation of developing countries at the Bretton Wood institution was a major achievement as well, and he was pleased that the issue had been placed on the agenda. 

On the other hand, he added, areas in need of advancement included getting the development agenda of the WTO back on track, and issues relating to debt, in particular those of the Heavily Indebted Poor Countries (HIPC).  Developing nations insisted that trade be at the centre of financing for development, which was a major source of financing in their nations.  In regard to debt-relief issues, progress had been made with certain nations receiving debt write-offs, yet, in the case of some Heavily Indebted Poor Countries, the assumptions under which those write-offs were made were not realistic.  Current events in the world economy -- in particular the fall of commodity prices -- had made those assumptions unrealistic and would need to be reconsidered at a future date. 

Likewise, the report called attention to the fact that there was no mechanism in the international economy to manage the debt of middle and low income nations not eligible for the Heavily Indebted Poor Countries initiative.  International cooperation on tax matters, which was becoming increasingly important due to the tax competition taking place to attract capital, was also an area in need of attention.

Asked what concrete initiatives would come out of the two-day dialogue, Mr. Ocampo said he expected nations to make political commitments and hoped for continued positive outcomes.  In regard to tax matters, Mr. Ocampo said the Secretary-General proposed the creation of a commission to deal with international cooperation on the matter, with the United Nations as the only possible forum for dialogue on the topic.

Following up on the Commission on Tax Matters under the Economic and Social Council (ECOSOC), Mr. Ocampo was asked if this was an attempt to turn ECOSOC into a more effective body, given its reputation as irrelevant.  Mr. Ocampo replied that he understood the concerns about the functioning of ECOSOC, but reminded correspondents that many international agreements had resulted from this process.  He added that the Commission could serve to share information on tax matters, and share commitments on what sort of tax holidays were or were not allowed.

Lastly, Mr. Ocampo was asked if, given the emphasis on rebuilding Iraq and the lackluster global economy, he expected commitments to other areas of international support to decline.  He responded that the commitments made were not huge amounts of money for developed nations, and that prospects for a recovery in the world economy were widespread.

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