Deputy Secretary-General Spells Out Policy Options, in Remarks to High-Level Meeting on Financing for Development in COVID-19 Era, Post-Pandemic Period
Following is UN Deputy Secretary-General Amina Mohammed’s remarks to the high-level meeting on Financing for Development in the Era of COVID-19 and Beyond, held today:
Over the four-month period since the high-level event on financing on 28 May, leaders’ calls for concrete financing solutions to the worst health and development emergency in a century have enabled robust debate among Member States, representatives of the United Nations system, regional organizations, institutional partners and observers, and global thought leaders, and produced ambitious options. These options were further informed by a meeting of over 50 experts on 19 August and then Finance Ministers at a meeting of ministers on 8 September.
We have heard from all speakers today that the pandemic is still with us and just how much conditions have deteriorated over the past few months — from a likely drop in global growth of more than 5 per cent and near 500 million jobs lost, to near-doubling of the number of people facing starvation, a decline in life expectancy, and heightened risk of instability, conflict and refugee flows and a massive loss of opportunities for women and girls.
We have also heard from the World Bank and the International Monetary Fund (IMF) the spending that is being done at the country level. And in hearing David Malpass, President of the World Bank, we have heard that it is too slow and too shallow, but we also need to address the crisis now and they are available for co-financing.
Today, we are here to extend solidarity not only to the most vulnerable who are in crisis, but also to many middle-income countries that are falling into crisis in the absence of urgent action. The policy options before you can address liquidity shortages; avert a potential debt crisis; help maintain jobs; and stop leakages from economies through illicit financial flows.
But, more than this, they can ensure that the recovery from the pandemic paves the way for an inclusive, sustainable and resilient future, based on the ambition of the 2030 Agenda for Sustainable Development and the Paris Agreement. Allow me to highlight six short- and medium-term policy options that have come out of the debate that we have had.
One, ensure that countries finances stay liquid — through a general allocation by the International Monetary Fund of special drawing rights and a voluntary redistribution of existing special drawing rights, to developing and vulnerable countries, including middle-income countries. This is underscoring the call that we have heard from Kristalina Georgieva, Managing Director of the IMF, for some of our rich countries to make available their [special drawing rights], and as she said, this helps us go forward with an economy that is greener, smarter and more equitable.
Two, create time for debt payments by extending the Debt Service Suspension Initiative at least until the end of 2021 and expanding its scope to cover all vulnerable countries, especially in Africa.
Three, address the debt overhang directly, by including all official bilateral and private sector creditors, and engaging credit-rating agencies in a dialogue on debt sustainability frameworks.
Four, enhance targeted funding to alleviate COVID-19, either by expanding existing funds and facilities or by creating new funds, such as the proposed Fund to Alleviate COVID-19 Economics and the Liquidity and Sustainability Facility — a special purpose lending facility —- to provide sustainable concessional finance and investments to developing countries.
Five, clamp down on corruption and crime. The discussion groups proposed immediate action to end illicit financial flows by tackling enablers and vested interests that benefit from them, including preventing profit-shifting by multinationals, and bolstering the availability, transparency and exchange of data on beneficial ownership. Recent revelations in the banking system show how important transparency and accountability are to stopping leakages from the economy.
Six, make sure budgets promote investments in the Sustainable Development Goals (SDGs) and climate action. We need to align national and local budgets to build a bridge from short-term emergency response measures to the longer-term aim of a strong, green, just and resilient recovery.
As the Secretary-General has said, recovery will not be complete until Africa has recovered, and the SDGs will not be achieved until they are achieved in Africa. Current commitments made to African Governments have yet to be fulfilled. Africa needs financial support urgently and at scale to implement African solutions to African problems, in line with Agenda 2063 of the African Union.
Implementing the options I have outlined, together with the commitments in the Addis Ababa Action Agenda, will lay the groundwork now for a better future. Following today’s meeting we will continue to promote these solutions and feed this momentum into the IMF/World Bank annual meetings, the G20 process, the Paris Finance in Common Summit and the Paris+5 stock take.
Today, we have in this virtual room yet another opportunity, with political leadership at the highest levels, to take this initiative forward and translate ambition into action. Together, we must prevent deepening of the humanitarian emergency and the development crisis we face and use the opportunity of a global response to recover better differently and achieve the 2030 Agenda. Thank you for your leadership and engagement.