Deputy Secretary-General Tells Summit International Financial Architecture Needs Deeper Systemic Reforms to Build More Sustainable, Resilient, Prosperous Future

Following is the text of UN Deputy Secretary-General Amina Mohammed’s video message to the third Finance in Common Summit, in Adidjan, Côte d’Ivoire, today:

My thanks to the African Development Bank and European Investment Bank for hosting this third Finance in Common Summit vital gathering.  We meet as the world confronts a cascade of challenges — from crushing debt burdens and a cost-of-living crisis to the escalating climate emergency and the war in Ukraine.  Once again, it is the world’s most vulnerable that are suffering the most.

Clearly, the international financial architecture is failing.  The current system entrenches the great finance divide and undermines the ability of developing countries to invest in people and their future.  We must act now — in greater solidarity and with greater urgency.

That is why the Secretary-General has called for the launch of an SDG [Sustainable Development Goals] Stimulus — led by the G20 [Group of 20] — to massively boost sustainable development, including urgent climate action, for developing countries.  As providers of affordable, long-term finance, development banks play a critical role, providing around 10 per cent of global investments.  But they can do much more.

First, the large multilateral and regional development banks must overhaul their business models, take more risk, and increase long-term concessional funding to developing countries to transition to renewable energy-based, climate resilient economies.

The African Development Fund’s partial credit guarantee issuance to support Benin raising funds for investments in SDGs is a good example.  New allocation of Special Drawing Rights must be handled differently based on justice and solidarity with developing countries.

Second, to ensure a just transition to renewable energy, development banks need to align their mandates with the Sustainable Development Goals and the 1.5 degrees goal of the Paris Agreement.  They must immediately exit from coal and phase out other fossil fuel investments.

People must also be at the heart of these transitions, supported through robust universal social protection and decent employment and job reskilling opportunities, including in the green sector.

Third, by working together, development banks can better manage and share risks, build capacities and capitalize on local knowledge.  This means leveraging local capacity and expertise, including by scaling-up initiatives such as the African Free Continental Trade Agreement (AfCFTA).  We look to the International Development Finance Club and Finance in Common to spearhead accelerated action.

At the global level, we will continue to advocate for enhanced debt relief and injections of fresh liquidity.  But, in the end, we need deeper systemic reforms if we are to succeed.  This will require re-prioritizing investments away from sectors that yield short-term profits towards long-term sustainable development outcomes aligned with the SDGs.  This means going beyond GDP [gross domestic product] as a metric for access to financing, integrating disaster clauses into all debt contracts and lowering the cost of borrowing.

Together, let us secure a more sustainable, resilient and prosperous future for all, by enabling all people to be the agents of the change they need.  I wish you a successful Summit.  Thank you.