Speakers Discuss Securing Broad Economic Recovery amidst Fallout from Virus, Geopolitical Tensions, as Financing for Development Forum Continues

The Economic and Social Council continued its annual forum on financing for development today, holding a special high-level meeting with the Bretton Woods institutions (the World Bank and the International Monetary Fund (IMF)), the World Trade Organization (WTO) and the United Nations Conference on Trade and Development (UNCTAD), to discuss solutions for securing an inclusive and sustainable recovery amidst the economic fallout from COVID-19 and rising geopolitical tensions.

Collen V. Kelapile (Botswana), President of the Economic and Social Council, said developing economies continue to struggle in boosting investment and aggregate demand, warning that there could be persistent increases in unemployment, poverty and inequality.  He called for stronger international cooperation, starting with fairer and more equitable distribution of vaccines around the world, strengthening of the international debt architecture, revitalization of the multilateral trading system and global tax system reform.  “Leaving no one behind is not only one of the core principles underpinning the 2030 Agenda for Sustainable Development — it should be a call for action guiding all our recovery efforts.  Our institutions have a special responsibility in realizing this vision,” he said.

Similarly, Azucena Arbeleche, Minister for Economy and Finance of Uruguay, and Chair of the Development Committee of the World Bank Group and IMF, said that economic recovery is likely to remain at risk, with commodity price shocks, supply chain bottlenecks and price rises hitting the most vulnerable in low- and middle-income countries.  She called on the World Bank Group to step up its financial policy and analytical support, noting that addressing unsustainable debt levels, as well as debt vulnerability in middle-income countries should be prioritized.  Also crucial is a rules-based trading system that provides broad and unrestricted market access for countries to sell their products abroad, she said, adding that this would help in the creation of jobs and debt repayment, especially in small and open economies where free trade with the rest of world is a key engine of growth.

Expressing similar concerns, Maimuna Kibenga Tarishi, President of the Trade and Development Board of UNCTAD, stressed the need for a new and ambitious policy agenda on tackling debt vulnerability, especially with respect to least developed and other vulnerable countries.  Closing the digital divide also remains a priority to allow for universal and affordable access to the Internet and digital devices.  On the climate crisis, she called for international cooperation to provide sufficient and predictable long-term financing to developing countries so that they can transition to a sustainable low-carbon economy.

An interactive dialogue on recovery and external debt, moderated by David Fairman, Managing Director of the Consensus Building Institute, followed, where speakers echoed warnings that the effects of the multiple crises are expected to be much larger in emerging markets and developing economies especially in fragile and conflict-affected situations.  Merza Hasan, Dean of the Board of Executive Directors of the World Bank Group, said that, despite its negative impacts, the pandemic has accelerated digital transformation, stressing that financing and partnership are crucial and calling on all stakeholders to work together to resolve challenges and develop better services for their client countries.

Ita Mannathoko, Chair of IMF’s Liaison Committee with the World Bank, United Nations and other international organizations, noting that the world now faces a “crisis on top of a crisis”, said IMF has stepped up support for the 20 per cent of members that are most fragile, including an expanded field presence and strengthened collaboration with the World Bank.  Lending is currently over $300 billion, helping members maintain access to liquidity, with last year’s 650 billion in special drawing rights (SDR) allocation, she said, noting that the new Resilience and Sustainability Trust will provide affordable longer-term funding to help address macrocritical challenges.  Diego Pary Rodríguez (Bolivia), Vice-President of the Economic and Social Council, said natural resources must be mobilized to generate greater productive capacity for strengthening domestic economies, adding that least developed, landlocked developing and small island developing States should have greater access to international financing with more favourable conditions.

However, representatives of civil society voiced concerns that the answers provided by the World Bank, IMF and other multilateral financial institutions, seem limited to more and more lending, signalling more debt.  A representative of the European Network on Debt and Development called for an assessment on debt sustainability based on multidimensional indices.  A representative from Gestos pointed out that while capital markets have boomed and created a few new billionaires, inequalities and poverty have increased.  Expressing alarm that talks on innovative financing continue to be limited to new debt, public resources and public-private partnerships, he called for solutions through financial transaction taxes, for example, that could bridge capital markets systems with the real economy to diminish countries’ distress.

Also speaking during the high-level meeting was Carlos Cuerpo, Secretary-General of the Treasury of Spain and Chair of Deputies of the International Monetary and Financial Committee of IMF.

Other speakers during the interactive discussion were representatives of Colombia, China and Brazil, as well as representatives of the World Bank Group and IMF.  A representative of civil society from the Global Policy Forum also spoke.

In the afternoon, the forum resumed its general debate where speakers highlighted the challenges faced by low- and middle-income and developing countries in accessing financing and debt sustainability, while also underscoring the pivotal role that tax collection and tax reform can play in rebuilding their economies.  The representative of the Philippines said her country is pursuing a comprehensive tax reform programme focused on measures that provide significant relief to individuals, micro, small and medium-sized enterprises, and corporations; broaden the tax base; and increase excise taxes on the consumption of harmful products.

Voicing concern that there is still no single global inclusive forum for tax cooperation at the intergovernmental level, the representative of Pakistan, speaking on behalf of the “Group of 77” developing countries and China, called for the full upgrade of the Committee of Experts on International Cooperation in Tax Matters to a United Nations intergovernmental body with experts representing their respective Governments.

The representative of Côte d’Ivoire, pointing out the links between the social, economic and environmental dimensions of sustainable development, stressed that all funding flows should be directed to those three areas concomitantly.  It is also necessary to promote tax adjustment policies and combat illicit financial flows, which are causing the African continent to lose nearly 4 per cent of its gross domestic product (GDP), he said.  He called for the relieving of debt burdens of developing countries to enable them to free up fiscal space for investment in social protection and climate resilience.

The representative of Sri Lanka, pointing to a great financial divide, noted that developed countries were able to fund their pandemic recovery with record sums borrowed at ultra-low interest rates, while developing States spend billions in servicing debt, making it impossible for them to invest in sustainable development.  As well, ratings companies continue to dismiss them “as if the world was perfectly normal”, he said, adding that that their plea for a debt moratorium from international lenders “fall on deaf ears”.  The pandemic, global tensions, supply chain disruptions and rising inflation have damaged his country’s domestic economy and its growth prospects — a predicament faced by other developing nations, he said, urging developed countries to come to their rescue.

Also speaking on the second day of the general debate were representatives of Guyana, El Salvador, Iceland, Japan, Portugal, China, Zimbabwe, Sierra Leone, Honduras, Mexico, Venezuela, Russian Federation, Belarus, Slovenia, Norway, United Kingdom, Angola, Austria, United States, Jamaica, Kenya, Dominican Republic, Switzerland, France, Zambia, Cuba, Sudan, Mongolia (on behalf of the Group of Landlocked Developing Countries), Malaysia, Oman, Armenia, Turkey, Antigua and Barbuda (on behalf of the Alliance of Small Island States), Nepal, Greece, Israel, Maldives and Argentina.

The forum will reconvene at 10 a.m. on Wednesday, 27 April, to continue its work.

Opening Statements

COLLEN V. KELAPILE (Botswana), President of the Economic and Social Council, opened the third informal meeting of the 2022 forum on financing for development follow-up, noting that the morning’s special high-level meeting with the Bretton Woods Institutions, the World Trade Organization (WTO) and the United Nations Conference on Trade and Development (UNCTAD) will focus on the theme of “Securing an inclusive and sustainable recovery”.  The COVID-19 pandemic continues to strain local and national health systems, exacerbating existing under-resourced health-delivery needs, he said, adding that rising inflationary pressures and increasing geopolitical tensions are weighing down efforts for a robust global economic recovery.  With even more stringent fiscal space constraints, developing economies continue to struggle in boosting investment and aggregate demand, warning that there could be persistent increases in unemployment, poverty and inequality.

Outlining other challenges faced by the international community, he said global greenhouse gas emissions are on the rise again, threating the lives and livelihoods of millions.  Stronger international cooperation is thus critical for a more balanced and inclusive global growth and recovery.  It starts with fairer and more equitable distribution of vaccines and effective administration around the world.  It also includes new global and regional approaches for addressing urgent liquidity needs and rising debt vulnerabilities — including by strengthening the international debt architecture with special consideration of the needs of vulnerable developing countries.  Welcoming the newly established Resilience and Sustainability Trust, he called for its expedited operationalization.

The multilateral trading system must be revitalized, with a view to promoting sustainable development, he went on to say.  The much-needed reform of the global tax system should above all benefit developing countries equally.  At the same time, public investments in social safety nets, education and climate resilience should be promoted to reduce fragility to future shocks.  “Leaving no one behind is not only one of the core principles underpinning the 2030 Agenda for Sustainable Development — it should be a call for action guiding all our recovery efforts.  Our institutions have a special responsibility in realizing this vision,” he concluded.

AZUCENA ARBELECHE, Minister for Economy and Finance of Uruguay, and Chair of the Development Committee of the World Bank Group and the International Monetary Fund (IMF), reported that the Committee recognizes current challenging conditions and overlapping crises, including spillover from the war in Ukraine.  Those massive humanitarian repercussions are affecting the global economy, and she called for a speedy resolution through political dialogue and mediation.  Economic recovery is likely to remain at risk amid geopolitical tensions, with commodity price shocks, supply chain bottlenecks and price rises hitting the most vulnerable in low- and middle-income countries.  She noted the Committee asked the World Bank Group to step up its financial policy and analytical support and coordinate with multilateral development banks, the World Food Programme (WFP) and other United Nations agencies, WTO and IMF for a global response to the crisis.  She commended the near tripling of international development assistance financing.

The pandemic remains a critical priority, she stressed — while vaccination rates have risen, setbacks to development gains have hit the neediest.  Addressing unsustainable debt levels amid rising interest rates should be a key priority, including through implementation of the G20 Common Framework.  Addressing debt vulnerability in middle-income countries is similarly necessary to help them return to sustainable growth paths.  She underscored that the international community must move from high-level commitments on climate and development to tangible action.  The World Bank Group was encouraged to support digitalization, and she urged close collaboration between that institution and IMF, including on the Resilience and Sustainability Trust, in support of a green, resilient and inclusive recovery.  Noting the Committee did not reach consensus on the communiqué, she decided to issue a Chairs statement reflecting the pressing issues discussed.  In this critical time, the multilateral system must remain focused and aligned, as its most important assets are the ability to lead in crisis and advocate for the most vulnerable around the world.

MAIMUNA KIBENGA TARISHI, President of the Trade and Development Board of the United Nations Conference on Trade and Development (UNCTAD), said COVID-19 has further exposed the vulnerabilities of developing countries, increasing their social needs while at the same time reducing fiscal space.  Their lack of access to vaccines means that new waves of the pandemic could derail their fledgling recoveries at any time.  The war in Ukraine has already led to a downgrade of global growth prospects by 1 per cent, she said, adding that increases in food and energy prices are causing a strain on developing countries.  Moreover, the fiscal and monetary tightening in developed countries threaten to stymy growth in poorer parts of the world.  As well, structural obstacles to a balanced recovery are compounded by shocks linked to warming global temperatures.  Despite these multiple crises the willingness to acknowledge the challenges facing developing countries is still missing, she stressed, noting that resources made available to support them have been far from matching the tasks at hand.  “We need to walk the talk to ensure equality in building back a better world,” she said.

Referring to the ambitious work plan for UNCTAD, she said developing countries’ access to finance, including climate finance, must be enhanced.  As well, their productive capacities must be strengthened to advance structural transformation towards a climate-resilient and sustainable economy.  In addition, new and innovative instruments of development finance should be explored.

Outlining various elements to ensure an inclusive and sustainable recovery, she said the international community needs a new and ambitious policy agenda on tackling debt vulnerability, noting that the existing sovereign debt architecture is not enough.  On the challenges of central banking and United States dollar access, she said a rules-based system of multilateral policy coordination could be considered as an alternative.  As they face mounting pressures related to pandemic recovery and illiquidity, special attention should be directed to least developed and other vulnerable countries.  As well, urgent efforts are needed to “rescue the Sustainable Development Goals”, she said, noting the compounding crises posed by climate change, COVID-19 and the situation in Eastern Europe.  Closing the digital divide also remains a priority to allow for universal and affordable access to the Internet and digital devices.  On the climate crisis, she called for international cooperation to provide sufficient and predicable long-term financing to developing countries so that they can transition to a sustainable low-carbon economy.

Noting that the Addis Ababa Action Agenda mandates that the forum consist of a one-day special high-level meeting with Bretton Woods Institutions, WTO and UNCTAD and other stakeholders, she called for the return to a full-day event so that important themes, such as trade and debt, could be explored with the attention that they deserve, affirming UNCTAD’s commitment to solving current challenges.

CARLOS CUERPO, Secretary-General of the Treasury of Spain and Chair of Deputies of the International Monetary and Financial Committee of the International Monetary Fund (IMF), said that because of the Russian Federation’s war against Ukraine, it was impossible to reach consensus on a communiqué, but there was very broad agreement across the membership on substantive issues, which are captured in the Chair’s statement issued after the meeting.  The recovery of the global economy from the pandemic has slowed down and is facing major setbacks from the war, with surges in energy and food prices and supply disruptions.  “We are indeed facing unprecedented uncertainties,” he said.  First and foremost, there was an overwhelming call by IMF to end the war.  He also cited the needs for international cooperation to safeguard macroeconomic stability and preserve the economic recovery, as well as urgent action on food security.

To tackle inflation, central banks will continue to closely monitor inflation expectations and appropriately calibrate the pace of monetary policy tightening in a data-dependent and clearly communicated manner.  The Fund is also monitoring financial vulnerabilities and risks to financial stability and will, as needed, apply targeted macroprudential measures.  The international community must also boost equitable access to vaccines and tests and enhance in-country delivery in needy countries.  There was consensus on IMF’s work agenda going forward, which includes supporting members through swift, tailored cutting-edge policy advice and targeted capacity development, supporting members experiencing balance of payments needs.  He also cited the importance of making the newly established Resilience and Sustainability Trust fully operational later in 2022.  Twelve countries have already committed about $40 billion in financing.  The Fund encouraged efforts to make further progress on debt treatments requested under the G20 Common Framework, he said, noting that China joining the creditor committee for Zambia is encouraging news.

Interactive Dialogue

DAVID FAIRMAN, Managing Director of the Consensus Building Institute, as moderator, opened the interactive dialogue with the participation of the Executive Directors of the World Bank Group and IMF and the Economic and Social Council Bureau on the topics of “Just and sustainable recovery” and “External debt”.

MERZA HASAN, Dean of the Board of Executive Directors of the World Bank Group, said countries entered the first wave of the pandemic already with weak economies and debt vulnerability.  Noting the downward projection in global growth due to multiple global challenges, he said “our institutions have a crucial role to play in supporting these countries to mitigate the impact of crises and to provide policy advice, financial support, technical assistance for enhanced growth and stability”.  Calling for enhanced coordination and partnership, he noted that nearly 1 in 3 people in the world (2.7 billion people) did not have access to adequate food in 2020, adding that food supply chain disruptions caused by the pandemic followed by the crisis in Ukraine will continue to worsen food insecurity and increase poverty and hunger.

In addition, the damage to human capital and reduction in public investment resulted in productive losses and increased unemployment, including for low-skilled and informal workers, he said, noting that the effects of the multiple crises are expected to be much larger in emerging markets and developing economies especially in fragile and conflict-affected situations.  Nonetheless, pandemic disruptions have accelerated digital transformation, he said, highlighting the need for positive structural reforms to contribute to a green, resilient and inclusive development.  Financing is key and partnership is crucial, he said, calling on all stakeholders to work together to resolve challenges and develop better services for their client countries.

ITA MANNATHOKO, Chair of the International Monetary Fund’s (IMF) Liaison Committee with the World Bank, United Nations and other international organizations, said the world now faces a “crisis on top of a crisis”, with the ongoing pandemic and climate shocks now complicated by the war in Ukraine.  In addition to the human suffering of those enduring the war, its ripple effects on food and energy prices are threatening the incomes of the most vulnerable economies across the world.  Inflation is a threat for many economies, she noted, with high debt levels now a key vulnerability for many low-income countries.  As a result, the recovery is even more divergent between the rich and the poor with a growing risk of fragmentation in global governance.

Citing this as a consequential moment for the international community, she called for securing a just and sustainable recovery for all — with immediate priorities being to end the war, end the pandemic once and for all, and tackle inflation and debt without losing sight of longer-term challenges such as climate change, digital money, gender and inequality.  The IMF has provided $1.4 billion in emergency financing to help Ukraine meet its immediate spending needs, and, together with international partners, is preparing for the reconstruction effort.  The IMF has also stepped up support for the 20 per cent of members that are most fragile, including an expanded field presence and strengthened collaboration with the World Bank.  Lending is currently over $300 billion, helping members maintain access to liquidity, with last year’s 650 billion in special drawing rights (SDR) allocation also contributing in that regard.  However, she noted low-income countries are using up to 40 per cent of their SDRs on COVID-related priorities like vaccines.  With debt rising, she called for improving and expanding the G20 Common Framework for Debt Treatments and noted the new Resilience and Sustainability Trust to provide affordable longer-term funding to help address macrocritical challenges.

DAVID TANAKA, Executive Director of the International Monetary Fund, noting that enormous investment is required to transform existing economic and social structures, said country ownership is critically important to catalyse finance from multilateral institutions and the private sector.  The Executive Board officially agreed to establish a new lending facility — the Resilience and Sustainability Trust — to address climbing debt and other challenges such as climate change and pandemic preparedness.  To address inequality, he said IMF programmes would be more focused on growth and social aspects through more realistic and well-tailored programme design, which could help member countries to more effectively address social distribution and protection going forward.

On the fiscal mechanism for mitigating the negative impacts of energy transition, he said one answer is to establish each country’s capacity development strategy, noting that IMF has been strengthening policy advice on assessing countries’ climate impact from a macroeconomic perspective.  Noting Japan’s announcement of a new financial contribution to a new digital window for inclusive growth and digital transformation, he called for further effective collaboration with Bretton Woods Institutions, WTO and UNCTAD to address current challenges.

KOEN DAVIDSE, World Bank Executive Director for Armenia, Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Georgia, Israel, North Macedonia, Moldova, Montenegro, the Netherlands, Romania and Ukraine, said the financial institution has devoted substantial resources, including vaccines, and is committed to a green, resilient and inclusive recovery.  The Group is also focused on the debt crisis that is limiting fiscal space and has provided extra international development assistance financing, with an extra year of funding created and $93 billion raised.  The Russian Federation’s invasion of Ukraine has led to an added crisis on all levels, he stressed — including huge human suffering, material destruction and a regional spillover effect that will see economic activity contract by 4 per cent.  “At every level it is the poor who will be most affected,” he said.  In response, the Bank has joined the Secretary-General for the coordinated global crisis response on food, energy and finance.  In the short run, it is also raising substantial resources for Ukraine and mobilizing funds for the wider region, especially those hosting refugees.  He noted the Bank is also focused on the climate crisis, with the first of 30 climate change development reports due soon, providing a road map for countries to deal with the issue.

DIEGO PARY RODRÍGUEZ (Bolivia), Vice-President of the Economic and Social Council, said States have entered greater indebtedness due to the high cost of the pandemic, noting that public expenditure needs, especially in developing countries, have increased significantly.  As such, fiscal space for countries must be broadened, considering their realities and capacities.  Identifying areas for progress, he said natural resources must be mobilized to generate greater productive capacity for strengthening domestic economies.  Also, least developed, landlocked developing and small island developing States should have greater access to international financing with more favourable conditions.  Moreover, international finance organizations must channel allocation and reallocation of SDRs in a way that ensures that all countries have sufficient liquidity to tackle the pandemic and its economic impact.  Developing countries’ easy and affordable access to financing instruments must be guaranteed without imposing conditions for that financing.  Calling for coordinated action at the national, regional and global levels, he said a permanent and ongoing dialogue with multilateral and regional banks must serve to consolidate the transformation of a global financial architecture and to create greater resilience.

The representative of Colombia, speaking on behalf of the Like-Minded Group of Countries Supporters of Middle-Income Countries, cited the need to urgently go beyond gross domestic product (GDP) as a measure of progress.  The Bretton Woods institutions should play a role in the complementary application of criteria based on vulnerability in accessing concessional finance and debt treatment.  He noted that multilateral development banks play an essential role in developing countries accessing credit beyond the market, calling on them to collaborate with the Bretton Woods institutions.  The 2022 Financing for Sustainable Development Report showcases the fiscal constraints and debt risks faced by developing countries in the pandemic context.  He noted that middle-income countries represent 60 per cent of developing countries downgraded by credit rating agencies.  He called on the Bretton Woods institutions to contribute to a realistic assessment on addressing debt sustainability and liquidity needs — namely the Debt Service Suspension Initiative, the Common Framework for Debt Treatments and the approval of SDR 650 billion.

A speaker representing the World Bank stressed the need for multilateralism and international cooperation more than ever.  With the 2030 Agenda at great risk of being derailed, the international community should work together as they did 12 years ago during the financial crisis, building trust as the foundation of collective action.  “Communication and dialogue are far better than finger-pointing and confrontation,” she said.  The pandemic crisis is not over yet, she stressed, with the global target of 70 per cent of populations vaccinated by mid-2022 far from being met.  Emphasizing the importance of a green transition in the medium and long term, she noted China’s action plan aims to achieve carbon neutrality by 2060.  As a primary energy source, coal accounted for 58 per cent of the country’s energy consumption in 2021 but will be gradually reduced to 25 per cent by 2030.  While the World Bank Group is the largest multilateral financer of the development agenda, she cited the current crises and called for financing to be scaled up from billions to trillions of dollars.

A second speaker representing the World Bank, noting the compounding vulnerabilities of fragile, low-income, emerging market economies, said a coordinated global action is needed to tackle mounting global challenges.  It is important to create fiscal space and measures to ensure timely and coordinated debt treatment.  Noting the low tax revenues in many developing countries, he said taxation and digital infrastructure are essential to increasing a tax base and tax collection.  On climate change, he said the World Bank has started “CCDRS” [country climate and development reports] to support countries in addressing climate and development issues.

A third speaker representing the World Bank, noting efforts to revamp the agenda for middle-income countries, said that the short-term recovery and medium-long-term development agenda should support members of that group in overcoming the “middle-income trap”.  That agenda could help in exploring synergies among middle-income countries and green initiatives, she said, calling for greater discussion on this agenda and ideas on the best strategy to move it forward.

The representative of the Global Policy Forum noted that the lion’s share of SDR 650 billion went to countries that do not need them, with SDR 400 billion remaining idle.  He, therefore, called on IMF member States to meet and exceed $100 billion in financing.  He noted SDRs can play a major role in climate funding, and IMF should adopt a needs-based allocation.

MAHMOUD MOHIELDIN, Executive Director of the International Monetary Fund (IMF), cited the Financing for Sustainable Development Report, a collaboration between the Department of Economic and Social Affairs, the World Bank, IMF, WTO, UNCTAD and the United Nations Development Programme (UNDP).  Its recommendations include the developing countries’ need for additional concessional public financing and improvement in the costs of borrowing.  He noted credit assessments are systematically biased against long-term investment, and that many developing countries and emerging markets will require debt relief to avoid debt crises.

Turning to solutions, he noted the Debt Service Suspension Initiative was very helpful but stopped at the end of 2021 — with 56 per cent of eligible countries now at high risk or already in distress and also facing liquidity pressures.  The Common Framework for Debt Treatments is not a panacea, he said, as its progress has been underwhelming.  He called for international financial institutions and the G20 to advance its operationalization and provide a clear timeline and urged the inclusion of middle-income countries.  The IMF Resilience and Sustainability Trust is not heavy on conditions, he noted, voicing hope that it will expand beyond climate change.  The development finance agenda, “simply put, is broken”, he emphasized, as it is inadequately supported by the multilateral system, and few countries have Sustainable Development Goal budgeting.  Countries have become addicted to debt-based financing, he said, but the way forward includes debt reduction mechanisms, private equity participation and innovation — as “we definitely don’t need more debt”.

ARMANDO MANUEL, World Bank Group Executive Director for Angola, Nigeria and South Africa, said the levels of debt in developing countries started rising even before the onset of COVID-19, adding that those States have the highest concentrations of poverty and inequality.  Addressing those challenges requires considerable funding, he said, however, most of those countries have less developed financial markets, or private funding is just too expensive for them.  Moreover, even if countries were able to borrow, many of them are already at high levels of debt distress with very limited fiscal space.  “The paradox is that developing countries need more debt to address the debt coffer,” he said, stressing that the only way that would be sustainable is when new debt generates high levels of economic growth.  However, current growth has been insufficient to generate income required to repay debt obligations.

In that regard, more focus is needed on programmes tackling economic growth.  For example, the African Continental Free Trade Area agreement would create the largest free trade area in the world.  The agreement holds sizeable promise for the continent, he said, calling for strong support from the World Bank, multilateral banks and international financial institutions.  In addition, spending efficiency must be improved in developing countries, he said, stressing that lack of good governance continues to rob countries and societies of the opportunity to efficiently apply much-needed resources.

Mr. RODRÍGUEZ said many countries are experiencing significant restrictions of fiscal space, increased inflation and an unsustainable debt burden, jeopardizing their recovery.  Asymmetrical fiscal policies reflect marked differences in COVID-19 health expenditures, he stated, requiring that the international community ensure the sustainability of the debt of developing and middle-income countries.  He called for re-established global liquidity, and the continuation of the Debt Service Suspension Initiative, while reconstruction of debt architecture may include debt swaps and debt forgiveness.

A speaker representing the European Network on Debt and Development expressed concern that the answers provided by the World Bank, IMF and other multilateral banks, seem to be limited to more and more lending, signalling more debt.  New debt should contribute to growth; however, in many countries most new borrowing is refinancing new debt obligations, further benefitting creditors.  Expressing concern that there is no functioning debt resolution mechanism in place, she called on IMF and other creditors to “step up their game” in providing legal protection and concessional financing support to borrowing countries that choose to default on recalcitrant creditors.  She called for an assessment on debt sustainability based on multidimensional indices, as well as for the bridging of financial capital markets with real economies to diminish the distress that countries are facing.

The representative of Brazil said in order to escape the debt trap, the financial economy must be linked to the real economy, with investments leading to productive capacity, job creation and, therefore, to fiscal receipts for the States.

Ms. MANNATHOKO said they will continue to explore viable innovative solutions.

Mr. MOHIELDIN said reform should start at home, at the country level, and if countries do not have a Sustainable Development Goal budget, they should ask their minister of finance why.  States must abandon their addiction to debt finance solutions.

Ms. ARBELECHE said IMF, World Bank and the United Nations are in a unique position to work with member countries to develop practical proposals on positive financial incentives to promote sustainable policymaking.  Also important are partnerships with middle-income countries to empower them to forge a greener recovery as part of their development strategy.  On trade as a global public good, she said a rules-based trading system underpinning global cooperation is crucial — one that provides broad and unrestricted market access for countries to sell their products abroad.  This would help in sustainable development through investment in human capital, creation of jobs and honouring of debt service, especially in small and open economies where free trade with the rest of world is a key engine of growth.

General Debate

ASHNI KUMAR SINGH, Senior Minister in the Office of the President with Responsibility for Finance of Guyana, noted that COVID-19 has brought severe economic dislocation, and the war in Ukraine has also caused global growth to slow from 6.1 per cent in 2021 to 3.6 per cent in 2022.  Inflationary pressures are rising as a result of the war, he warned, with 2022 inflation in advanced economies now projected at 5.7 per cent and in emerging and developing economies at 8.7 per cent.  Transport and energy infrastructure are critical to unlocking his country’s agricultural potential at scale, he noted, highlighting that Guyana is leading the Caribbean Community (CARICOM) Agri-Food Systems Agenda to enhance regional food security and eradicate poverty.  He went on to stress the urgent need for States to deliver on committing 0.7 per cent of gross national income to official development assistance (ODA).  Reiterating the call for vulnerability to be measured and considered in determining access to concessional financing, he said that it is critical for small island developing States which suffer the illusion of middle-income status but, in reality, are disproportionately and acutely vulnerable and face difficulties accessing financing consistent with their needs.

ALEXANDRA HILL TINOCO, Minister for Foreign Affairs of El Salvador, said her country’s President recently implemented 11 measures for economic relief, including suspending some import taxes, as well as on fossil fuels.  The measures also include oversight to prevent arbitrary increases in the prices of raw materials, electricity and other commodities.  She cited parallel efforts to drive local trade, the tourism sector and firm up a stable legal framework to secure a trustworthy investment climate.  As the pandemic revealed the importance of innovation, she noted El Salvador’s use of Bitcoin as a currency of legal circulation, while the country’s Digital Nation project increases its status as a competitive exporter in that domain.  She advocated for specific and fair assignment of resources and ODA.

ÞÓRDÍS KOLBRÚN REYKFJÖRÐ GYLFADÓTTIR, Minister for Foreign Affairs of Iceland, said the ramifications of COVID-19, climate change, conflicts, and, most recently, the Russian Federation’s senseless war in Ukraine, are moving the world in the wrong direction.  A high rate of vaccination, in particular among those most vulnerable, is essential, and Iceland has played its part with significant contributions to the COVAX Facility and the United Nations Children’s Fund (UNICEF).  It is also essential to lessen the impacts of higher food and energy costs, which have only increased because of the Russian Federation’s aggression in Ukraine.  “It is a horrifying fact that the heaviest burden will yet again fall on the shoulders of populations that are least prepared to bear them,” she said — although, when the dust of the pandemic has settled, it will be hard not to criticize some of the responses among the rich nations of the West.  She called for equitable recovery from the pandemic, promoting the key drivers of green and inclusive economic growth and enhancing developing countries’ access to finance — noting Iceland will continue to increase its ODA in 2022.

SUZUKI TAKAKO, State Minister for Foreign Affairs of Japan, noted that her country is focusing on the areas of health care and climate change in the spirit of solidarity, including efforts to achieve universal health coverage.  Regarding climate change, she recalled her country’s plan to provide climate finance totalling $60 billion from both public and private sources over the next five years, as well as up to $10 billion additional assistance announced at the twenty-sixth United Nations climate change conference.  Developing countries’ debt sustainability is also an important issue, she said, calling on all official bilateral creditors and private creditors to swiftly implement appropriate measures in a transparent manner in accordance with the Common Framework for Debt Treatments beyond the Debt Service Suspension Initiative agreed to by the G20 in November 2020.  Stressing the need to identify and respond to the gaps in financing for development, she urged all United Nations Member States to cooperate with the initiative to track a wide range of financial flows to developing countries from aid providers, including emerging donors.

ANTONETTE TIONKO (Philippines), associating herself with the “Group of 77” developing countries and China and the Like-Minded Group of Countries Supporters of Middle-Income Countries, said efficient and sound fiscal policies continue to be her Government’s primary tools to ensure that development projects are pursued and accelerated.  The Philippines is also pursuing a comprehensive tax reform programme focused on measures that provide significant relief to individuals, micro, small and medium-sized enterprises, and corporations; broaden the tax base; and increase excise taxes on the consumption of harmful products, making their system simpler, fairer and more efficient.  Grateful for the technical and financial assistance of its development partners in providing budgetary support and vaccine mobilization, she called on the international community to continue to provide assistance, especially to low-income and developing countries in areas of improved vaccine access, liquidity to contain financial stability risk, green development and global climate goals.

FRANCISCO ANDRÉ, Secretary of State for Foreign Affairs and Cooperation of Portugal, welcoming the creation of the Global Crisis Response Group on Food, Energy and Financing, said his country has contributed to efforts to tackle those crises.  It has also supported global action for vaccine equity, having donated over 7 million vaccine doses, through COVAX and bilaterally to 17 developing countries.  Portugal increased by 4 per cent its ODA in 2021, according to the Organisation for Economic Co-operation and Development’s (OECD) preliminary data.  Noting that development is a multidimensional, non-linear process, he said other criteria beyond GDP, which reflect inequalities between countries, including climate, must be considered.  In that regard, the creation of a High-Level Panel of Experts to finalize a multidimensional vulnerability index for small island developing States, by the end of 2022, is a step in the right direction.  The United Nations Ocean Conference, hosted by Portugal and Kenya in Lisbon, from 27 June to 1 July, will give the international community the opportunity to discuss some of those issues, he said, including rising sea levels and warming oceans, while considering science-based innovative solutions to support a new chapter in global ocean action.

YU WEIPING, Vice-Minister of the Ministry of Finance of China, called on the international community to bridge differences and build a political consensus for development.  He said that greater political will is needed in implementing the Monterrey Consensus, the Doha Declaration and the Addis Ababa Action Agenda.  Stressing the importance of mobilizing resources for development, he noted that developed countries should assume the primary responsibility for development financing and fulfil their ODA commitments.  Multilateral development institutions such as the World Bank should enrich and innovate investment and financing tools to enhance the long-term financing capacity of developing countries, and the private sector can support low-income countries through non-debt investment and financing tools.  Highlighting the need for debt alleviating initiatives from multilateral creditors, he also called on States to improve governance and strengthen policy coordination for development, to help developing countries better integrate into the global supply chain and increase their representation.

CLEMENCE CHIDUWA, Deputy Minister for Finance and Economic Development of Zimbabwe, associating himself with the statement to be delivered by the Group of 77, the African Group and the Group of Landlocked Developing Countries, noted that developing States are experiencing socioeconomic setbacks due to the pandemic and geopolitical tensions.  He cited the Secretary-General’s report calling for a new global deal to ensure that power, wealth and opportunities are more broadly shared.  Zimbabwe is experiencing low levels of revenue earnings and shrinking external financing, thereby requiring increased concessional financing and ODA to fund the post-pandemic recovery.  He cited domestic initiatives on digitalization and financial reforms to ensure inclusion, noting that the country was selected by the joint United Nations Sustainable Development Goals Fund as being the most investment-ready State, approving its $45 million renewable energy programme.

JONATHAN TITUS-WILLIAMS, Deputy Minister for Planning and Economic Development of Sierra Leone, associating himself with the Group of 77 and the African Group, said that although his State experienced far fewer cases and deaths due to the pandemic, its GDP contracted by 2 per cent in 2020.  The support of development partners helped keep Sierra Leone’s economy afloat at the peak of the pandemic, along with its own sound fiscal and monetary approaches.  The country is more focused on domestic revenue mobilization, and it introduced an integrated tax administration system.  He noted the Government has also rolled out electronic cash assistance to businesses, established tax offices in dense business areas and scaled up financial digitalization.  Sierra Leone has also launched a national strategy for financial inclusion and measures to promote inclusion and is fighting corruption and illicit financial flows.

CINDY RODRIGUEZ (Honduras) said that hurricanes Eta and Iota, which hit her country in 2020, and the impact of the pandemic resulted in losses amounting to $2.125 billion.  Noting her country’s difficulties in grappling with its economic, health and climate vulnerabilities, she said its structural problems were worsened by the past Administration’s corrupt and criminal practices.  The deep-seated inequalities in Hondurans’ access to resources and public services require international financing and cooperation in a timely manner with terms and conditions that are appropriate for the development level of the country.  Also needed are sources of funding that provide accessible and adequate financing with more simplified processes.  Her country’s priorities are to eradicate poverty, eliminate hunger and fight corruption, and to be more resilient to climate change.  For the successful implementation of the 2030 Agenda, existing spaces for international cooperation must be strengthened, and new and complementary ones created.

MARTHA DELGADO PERALTA (Mexico) said the process of financing for development is a key tool for ending the pandemic and bringing about a global economic recovery.  In that regard, her country, together with Switzerland and Germany, organized the sixth session of the Group of Friends of Monterey in order to promote an open and frank debate on sustainable financing.  The process must be based on grappling with the most urgent global challenges, such as closing the recovery gap between developed and developing countries.  Noting the need for extraordinary efforts to overcome current crises, she said taxes can play a key role in wealth distribution.  In addition, Governments must mobilize the financing of all available sources to help achieve the sustainable development agenda and align interests among various sectors through a system of incentives and co-benefits.

RUBÉN MOLINA, Vice-Minister for Multilateral Affairs of Venezuela, said the recurring and serious crisis in the global economy due to inequality — along with the pandemic and the confrontation in Europe and added to criminal policies imposed by unilateral coercive measures — threaten its ability to reach the Sustainable Development Goals.  It is the responsibility of developed countries to at least partially alleviate the debt of countries that provide raw materials and commodities, he said.  He called for the establishment of a new world order and geopolitical situation that can bring about equilibrium in the universe and planetary peace.  Financing for development remains one of main elements in implementing the 2030 Agenda, he affirmed — but financing must be diversified along with eradicating conditions attached to ODA.  Noting some countries continue to impose cruel and inhuman measures upon countries in the South — which undermine the rights of two thirds of humanity — he demanded a complete end to unilateral coercive measures.

ALEXANDER PANKIN, Deputy Minister for Foreign Affairs of the Russian Federation, said it is time to admit the obvious:  the Sustainable Development Goals are unattainable.  The reason for current failures in economic development is injustice of the existing international economic order, which is perpetuated by the unwillingness of developed countries to revise the present financial architecture that infringes upon rights and legitimate interests of the developing world.  Developing countries are also encouraged to continue borrowing on international capital markets to increase budgetary capacities — but in almost half of sub-Saharan African countries, over 25 per cent of Government revenues already go to service foreign debts, and 54 States worldwide are in debt distress.  Against the backdrop of unprecedented profits for leading pharmaceutical companies, he stressed vaccination in African countries still does not exceed 11 per cent of the adult population.  Without rapid industrialization, diversification of economies and elimination of commodity dependence, it is impossible to ensure accelerated sustainable development.  He stated that the Russian Federation is facing unprecedented sanctions pressure based on lies and hypocrisy.

YURI AMBRAZEVICH (Belarus) remarked that unfortunately the actions of many developed countries contradict their commitments and destroy the prospects for global achievement of the Sustainable Development Goals.  Moreover, using political pretext to draw down projects under the World Bank and other financial institutions is a dire violation of donor countries’ international commitments, he said, adding that restricting members’ cooperation with certain States, including access to grants and technical assistance projects, are gross violations of the principles of non-discrimination.  Noting that the scale at which certain States are initiating unilateral economic sanctions is unprecedented, he said the sanctions introduced by the European Union against Belarus’ export of potash fertilizer is negatively impacting global food security, leading to record prices in fertilizer and related food products, and could cause famine in least developed countries.  The thoughtless policy of restriction and discrimination nullify efforts of the international community to achieve the Sustainable Development Goals, he said, calling on Member States to prevent donors from usurping the rights of Member States to define their own paths.

STANISLAV RAŠČAN (Slovenia) said that his country increased its ODA in 2021 to 0.19 per cent of gross national income, despite the trend of falling bilateral ODA on the global level during the pandemic.  It has also raised a share of ODA for the least developed countries.  Noting its flexible and efficient development cooperation system, he said Slovenia donated considerable amounts of vaccines and other in-kind assistance and contributed to the COVAX Facility.  It also increased its humanitarian aid to address growing humanitarian crises.  Slovenia also continues to contribute to the Least Developed Countries Fund of the Global Environment Facility and participate in the replenishments of the Facility.  Committed to actively participating in the various strands of the Addis Ababa Action Agenda, Slovenia is actively participating in processes to enhance the role of the international and local private sector to support the development of partner countries.  As a member of the Addis Tax Initiative, his country places great emphasis on policy dialogue, and providing technical assistance to its partner countries through the Slovenia-based international organization Center of Excellence in Finance, which is also partnering with IMF.

BJØRG SANDKJÆR, State Secretary for International Development of Norway, said inequality has increased within and between States, with the Russian Federation’s illegal attack on Ukraine triggering turmoil on global markets.  Fiscal space is shrinking, with an increased debt burden for developing countries.  Financing for development is under pressure, and attainment of the Sustainable Development Goals by 2030 is slipping away.  Domestic revenue mobilization is the pillar of development, she affirmed, while ODA must underpin national efforts — and Norway is one of the top contributors by share of gross national income.  She noted financial secrecy and tax evasion lock countries in poverty and erode trust in democracy.  Civil society and media have important roles to play.  Crisis management seems like the new normal, she noted, but in an interconnected world, the international community must strengthen the multilateral framework.

TARIQ AHMAD, Minister for South Asia, North Africa, the United Nations and the Commonwealth of the United Kingdom, said Russian Federation President Vladimir Putin’s senseless and illegal war has made the world’s job much harder, exacerbating humanitarian need everywhere, hurting the most economically vulnerable.  The United Kingdom is providing over $400 million in humanitarian, fiscal and energy assistance to Ukraine and spent over $11 billion in development assistance in 2021 alone.  The country also co-hosted the Afghanistan Pledging Conference, which provided a further $374 million to that country.  He called for ensuring every girl’s right to 12 years of quality education and for ending the scourge of violence against women.  The British Investment Partnership continues to work with capital markets and other partners to mobilize up to $10.5 billion in annual development funds by 2025.  Emphasizing the need to address massive debt burdens in a sustainable way, he noted the United Kingdom has committed an additional SDR 1.4 billion to the IMF’s Poverty Reduction and Growth Trust.

MILTON REIS, Secretary of State for Planning of Angola, said due to the impacts of the pandemic, his country was forced to request an extension of the deadline to graduate from the list of least developed countries for another three years, initially scheduled for February 2021.  Instead, it is now expected to graduate in February 2024.  To address the economic and financial crisis resulting from external shocks, his Government has undertaken a macroeconomic stabilization programme from 2018 to 2021 with the support of IMF, aimed at correcting a series of macroeconomic imbalances to ensure the sustainability of public finances and external accounts for inclusive and sustainable economic growth.  For 2022, forecasts point to a GDP growth of 2.8 per cent.  Macroeconomic reforms were accompanied by the implementation of a programme to increase domestic production and promote exports, focusing on agriculture, which has driven the diversification of Angola’s economy and reduced dependence on oil, which remains the main export product.

PETER LAUNSKY-TIEFFENTHAL, Deputy Minister for Foreign Affairs of Austria, noted that any negative impact on agricultural production in Ukraine will have consequences for global food security and the global economic situation as a whole.  He went on to point to the debt crisis, as debts of all kinds have risen to multi-decade highs.  Heavy debt burden means narrowing fiscal space for many developing countries to make investment for achieving the Sustainable Development Goals.  Welcoming all global efforts on managing the debt burden, from the Debt Service Suspension Initiative to the ongoing G20 Common Framework for Debt Treatments, he stressed that the inclusion of private creditors to participate on comparable terms to ensure fair burden-sharing will be key.  He also called on States to enhance debt transparency and strengthen capacities for effective debt management to address the surging global debt burden in a sustainable way.

SAMANTHA POWER (United States) noted that the pandemic has eroded development gains made over the previous years and thrown an additional 97 million people into extreme poverty.  The unprovoked invasion of Ukraine by the Russian Federation is compounding inflationary pressures and disrupting the stability of global food and fertilizer markets, causing a surge in food prices.  While the United States remains the largest donor of ODA, disbursing $42 billion in 2021, no amount of foreign assistance will be enough to overcome those daunting challenges and meet the Sustainable Development Goals.  She went on to highlight her country’s efforts to grow private investment in emerging nations, including sponsoring delegations of non-traditional investors like pension funds to travel to Africa, spurring investments in small and medium-sized African businesses, using loan guarantees and grants to encourage private investment in every area from vaccine manufacturing to green energy infrastructure.  Her country is also working with partner Governments to strengthen their institutions, harmonize their regulations and fight corruption, creating the kind of enabling environments that foreign investors desire.

KAMINA JOHNSON SMITH, Minister for Foreign Affairs and Foreign Trade of Jamaica, said the country’s domestic policies aim to achieve economic national independence.  On climate change, he said that Jamaica was the first small island developing State to issue a catastrophe bond, valued at $185 million or 1.3 per cent of GDP.  Though the bond can cover annual losses at present, it will have to be recalibrated due to the increasing severity of natural events.  It remains essential to resolve challenges to development including through the redistribution of development funding to give countries like Jamaica greater flexibility in allocating development funding given its limited fiscal space.  She called for innovative funds that do not exclude middle-income countries, and reform of international debt architecture to include a sovereign debt workout mechanism.  Voicing support for the work of the United Nations towards a multidimensional vulnerability index, she noted the international community can do more to help all small island developing States, calling for transformative multinational efforts towards greater liquidity.

JOEL SAITOTI TOROME, Principal Secretary, State Department for Planning, the National Treasury and Planning of Kenya, said most countries are still grappling with the pandemic, which has driven high living costs, unemployment and debt.  Sustainable recovery requires mobilization of domestic and international resources and prudent debt management, he said, acknowledging that due to shrinking fiscal space, Kenya has put in place measures and reforms to moderate spending levels and fund health, education and social welfare, and support the private sector.  He pointed to continued reforms to the tax system to enhance revenue, as well as a rollout of various economic stimulus programmes to drive growth and sustain previous gains, and called for greater production and equity of vaccines.

LUIS MADERA (Dominican Republic), associating himself with the Alliance of Small Island States, Group of 77, the African Group and the Like-Minded Group of Countries Supporters of Middle-Income Countries, stressed that youth employment is the motor for economic recovery.  Thus, it is important to create more job opportunities for young people, as they in the long run could increase wealth, by increasing fiscal space and reserves for pensions, and aid in development.  Stressing the importance of the private sector in driving development, he expressed hope for greater public-private partnerships.  He called on agencies that look at risk levels to take into account the current crises and economic circumstances exacerbated by war.  Urging true global solidarity, he underscored the need for equal access to vaccines.

CHRISTIAN FRUTIGER (Switzerland) said that, although the pandemic and armed conflict have caused setbacks to development gains, the 2030 Agenda continues to provide the appropriate reference framework to address global challenges.  Stressing the need for a comprehensive approach to financing the Sustainable Development Goals, he said financial resources, technology and know-how from the private sector must be mobilized.  As well, States should create an enabling environment for sustainable investment, attract more commercial financing for development purposes, and channel that money into countries and sectors where needs are greatest.  Underscoring the importance of maximizing the effectiveness of all forms of cooperation for development, he said Switzerland will host the 2022 Effective Development Cooperation Summit in Geneva in December 2022.

MICHEL MIRAILLET, Director General for Global Affairs, Culture, Education and International Development of France, condemned the Russian Federation’s unprovoked and unjustified military aggression against Ukraine, which jeopardizes global recovery.  Calling for mobilization of quality funding, he cited the record level of ODA in 2020, and a very high level in 2021.  France has taken steps to reach O.55 per cent of gross national income of ODA in 2022 and will try to reach 0.7 per cent in 2025.  However, sustainable recovery measures must be based on better mobilization of domestic resources, which must be the first source of financing — also accompanied by a strengthened fight against illicit financial flows, which weigh heavily on the available fiscal space.  France has funded the COVAX Facility with €25 million, he said, and has also pledged to donate 120 million doses of vaccines.  He noted the Debt Service Suspension Initiative has made it possible to relax constraints on liquidity, through postponement of nearly $13 billion in maturities between May 2020 and December 2021.  France further supports the general allocation of SDRs by the IMF in order to strengthen the foreign exchange reserves of all member countries.

CHARLES BANDA, Director for Population and Development, Ministry of Finance and National Planning of Zambia, associating himself with the Group of 77 and the African Group, noted the pandemic reversed gains, forcing the country to divert most public expenditures to COVID-19 mitigation measures.  As a result, he noted Zambia was unable to service its debt, falling into debt distress, calling for international assistance from the Common Framework for Debt Treatments.  The country is now working to develop a medium-term debt management strategy for 2023 to 2025, along with reforms in the agriculture and energy sectors to remove consumption subsidies that pressure the budget.  He noted the Government is also strengthening public-private sector development financing models and aims, with the support of the international community, to expand fiscal space.

ANA SILVIA RODRÍGUEZ ABASCAL (Cuba), associating herself with the Group of 77 and the Alliance of Small Island States, said that ODA should be the main channel of international cooperation; however, developed countries continue to not fulfil their pledges of contributing 0.7 per cent of their gross national income to countries most in need of development.  “Some Powers” are wasting billions of resources in an arms race and the militarization of outer space, financing the destabilization of democratically elected Governments and imposing unilateral coercive measures in other countries.  This is evidenced by the economic, financial and trade blockade imposed by the United States on Cuba for the last 60 years, she said, noting that the illegal policy has been resoundingly rejected by the international community and the United Nations.  Stressing that there is no magical formula to materialize commitments of financing for development, she said national efforts to comply with the 2030 Agenda and the Addis Ababa Action Agenda should be supported by concrete action in the areas of access to markets, capacity-building, transfer of technologies, external financing with fair conditions and North-South cooperation, calling for an urgent solution to the problem of growing debt.

ELHADI OMER MOHAMED ISMAIL (Sudan) said his country has already embarked on a programme of drastic economic reform following the victory of its December 2019 revolution.  The national transitional Government has reached an agreement with the World Bank and IMF regarding the country’s debt relief settlement through the Heavily Indebted Poor Countries Initiative.  In addition, an external credit facility programme has been concluded, with a completion date of 2023.  Noting agreement of the Paris Club Forum to the settlement of a considerable debt, he said bilateral negotiations with the non-Paris Club have also begun to reach a debt relief settlement.  Sudan has already started to implement economic reforms, including subsidy removal of all commodities, tax reforms, custom reforms and public enterprise reforms, among others.

ENKHBOLD VORSHILOV (Mongolia) speaking on behalf of the Group of Landlocked Developing Countries, expressed concern that financing for the Sustainable Development Goals remains a major challenge for those States.  Substantial resources are needed more urgently than ever due to the pandemic reversing hard-won gains, he said, calling on the international community to meet the Group’s investment needs in transportation infrastructure, renewable energy, manufacturing and service industries.  He noted debt levels rose over the last two years, with the World Bank reporting debt rose to 64 per cent of GDP in 2020.  In addition, nine landlocked developing countries are classified as at high risk of debt distress.  He noted ODA represents more than half of gross national income for 15 of the 32 countries and called for a debt moratorium to be packaged into long-term debt restructuring, cancelling or reprofiling debt for those most at risk, and for official creditors to consider debt swaps.

MUNIR AKRAM (Pakistan), speaking on behalf of the Group of 77, said the road to recovery from the pandemic and achievement of the 2030 Agenda requires global and equitable access to safe and affordable COVID vaccines, as well as agreement that intellectual property rights should be implemented in a manner that remains supportive of States’ rights to protect public health and promote access to medicines.  He urged the elimination of safe havens that create incentives for the transfer of stolen assets and illicit financial flow, underscoring the bloc’s strong commitment to ensuring the return of stolen assets to countries of origin.  Voicing concern that there is still no single global inclusive forum for tax cooperation at the intergovernmental level, he reiterated the Group’s call for the full upgrade of the committee of experts on tax matters to a United Nations intergovernmental body with experts representing their respective Governments.

He called for scaled-up financing to protect livelihoods and health of everyone, especially those in vulnerable situations, close the financing gap, invest in productive employment and decent work for all and strengthen the social protection system.  Stressing that investments in sustainable and resilient infrastructure is critical to an inclusive COVID-19 recovery, he urged developed countries to fulfil their ODA commitments.  He called for special and differential treatment for developing countries in harnessing benefits of international trade.  Voicing concern by the increase in unilateral and protective measures that undermine the multilateral trading system, he urged States to refrain from applying unilateral economic measures that are not in accordance with international law and the Charter of the United Nations.  Expressing appreciation for the historic allocation of SDR 650 billion, he encouraged countries with strong external positions to voluntarily channel at least SDR 250 billion to all developing countries in need.  Noting that inaccurate credit ratings could negatively impact the cost of borrowing, he called on credit rating agencies to ensure that information is derived independently and accurately.  He called on developed countries to honour their commitments in providing financial resources in the amount of $100 billion per year and assisting countries in their climate action plans.

The representative of Malaysia, associating himself with the Group of 77, said the pandemic has disproportionately affected those already marginalized, making it critical to ensure hard-won development gains are not reversed.  In that regard, the Government has established the Malaysia Sustainable Development Goals Trust Fund, a multi-donor mechanism to which it allocated RM20 million as an initial contribution.  Noting the need for an enabling environment and innovative solutions to address financing gaps, he said the country has successfully priced the world’s first Islamic bond.  Integrating environmental, social and governance financing into businesses can build a resilient economy, he said, noting industrial players are required to adopt that financing into their business practices.

The representative of Oman, associating herself with the Group of 77, said her Government still believes in global solidarity and the role played by the whole United Nations ecosystem in assisting Member States in building capacity, leveraging partnerships and accessing best practices, including on the use of domestic resources for sustainable development.  She highlighted the importance of bridging the digital divide — nationally and globally — and harnessing the potential of science, technology and innovation.  She noted that the role of foresight, preparedness, risk management and emergency responses are also crucial, as shown by the various challenges brought on by the pandemic.  While Oman responded swiftly to the pandemic by enhancing its social and health protection systems, it is also committed to encouraging entrepreneurship, boosting private investments, investing in digital infrastructure, empowering women and supporting youth.

DAVID KNYAZYAN (Armenia) said middle-income countries face specific development needs, which require a tailor-made approach and elaboration of a comprehensive set of criteria that go beyond GDP per capita, especially with respect to facilitation of their access to concessional financing.  Expressing appreciation for the Secretary-General’s recommendations contained in his report on Our Common Agenda to identify complementary measures to GDP and use vulnerability as a criterion to develop indicators, he noted that the work of the High-Level Expert Panel on elaboration of the multidimensional vulnerability index for small island developing States has the potential to become a tool to measure the diverse development needs of developing countries.  Commending the Joint Sustainable Development Goals Fund for bringing together the United Nations development partners to support the development of the integrated national financing network for Armenia, he said those efforts will contribute to the localization of the Goals into the national policies and strategies.  They will also strengthen the financing architecture for effective policy implementation in the priority areas of climate change, food security and human capital.

FERIDUN H. SINIRLIOĞLU (Turkey), also speaking on behalf of Mexico, Indonesia, Republic of Korea and Australia, said development finance institutions must align their practices with the 2030 Agenda.  He expressed support for the Access to COVID-19 Tools Accelerator and the COVAX Facility, while recognizing that the targeted global vaccination rate of 70 per cent has not been achieved.  He reiterated the importance of the Anti-Counterfeiting Trade Agreement for the international community to address financing gaps of the pillars of that agreement.  He welcomed progress achieved under the G20 Debt Service Suspension Initiative, while noting the lack of private sector participation.  Welcoming efforts to progress the Common Framework for Debt Treatments beyond the Debt Service Suspension Initiative, he reaffirmed his bloc’s commitment to implement it in a timely, orderly and coordinated manner.  Stressing the importance of open and fair rules-based trade in restoring growth and job creation, he said his group of countries is committed to fighting protectionism and encourages concerted efforts to reform WTO.  Welcoming pledges amounting to $60 billion through the voluntary channelling of SDRs, he encouraged further pledges as a step towards the total global ambition of $100 billion in voluntary contributions for countries most in need.  Underscoring the importance of nationally owned sustainable development strategies, he said that such efforts must be supported by an enabling international economic environment.

IOANNIS SMYRLIS, Secretary-General for International Economic Affairs and Openness of Greece, noting the private sector’s central role in creating decent jobs, said Governments must continuously support a pro-investment climate and a business-friendly environment aiming at the development of the private sector, especially for micro, small and medium-sized enterprises.  Foreign direct investment (FDI), together with public and other private investments, is an important source of finance for inclusive and sustainable development, he said, adding that it helps increase innovation, create sustainable jobs, develop human capital and promote gender equality.  To materialize the potential benefits from investments, Governments must ensure that domestic policy and legal frameworks support positive impacts of investment on sustainable development.  In order to facilitate investment and sustainable development opportunities, information failures and administrative barriers must be addressed, he said, noting that policymakers should raise public and stakeholder awareness on the impacts of investment on sustainable development; improve the link between investment promotion and sustainable development objectives; improve the link between investment facilitation activities and sustainable development objectives; and promote internationally recognized human rights standards and gender equality.

EMIL BEN NAFTALY (Israel) expressed support for strengthening the capacities of revenue administration through modernized, transparent and progressive tax systems and more effective tax collection, adding that his State will continue to work towards promotion of that approach in other countries.  Committed to increasing its ODA through its development agency, Israel will also continue to work in different frameworks, including bilateral and trilateral projects.  Underscoring that climate change directly impacts human life, biodiversity and extreme weather events, he said that practical, scalable and simple solutions for mitigation and adaptation are needed.  In that regard, his country is ready to share its experience and know-how in water management, agriculture, renewable energy, nature-based solutions, food security and other areas.  Reaffirming its commitment to achieve net zero emissions by 2050, he said Israel will phase out all coal use by 2025.  Recognizing the importance of digitalization in development, he voiced concern that digitalization of the economy and progress in science, technology and innovation may create new risks and worsen inequalities, if not carefully managed.  In that regard, he said his country will increase its efforts to ensure universal and affordable Internet access, digital skills training and targeted policies for specific groups, including women and girls, to close digital gaps within and between countries.

The representative of Maldives, associating himself with the Group of 77 and Alliance of Small Island States, said that despite the support of international partners, the country was forced to expend tremendous financial resources to respond to the pandemic alongside the unprecedented destruction of the tourism industry — the one that powers its economy.  Accessing concessional financing remains a challenge, he said, calling for institutions to increase low-interest debt financing for small island developing States.  The country is working to diversify and strengthen its economy and has increased foreign investment flows in renewable energy and tourism.  While implementing developmental frameworks, Maldives remains off-track for achieving the Sustainable Development Goals.  Climate finance is lacking, with the international community promise of $100 billion in annual funding unfulfilled, while the United Nations Environment Programme (UNEP) estimates that annual adaptation costs in developing countries will be $280 billion to $500 billion by 2050.  It is also vital to advance work on the multidimensional vulnerability index, he said.

The representative of Argentina, associating herself with the Group of 77, said the pandemic confirmed the lack of sustainability of accumulation and growth models, with financing for development key to dealing with unemployment, extreme poverty and hunger.  She highlighted science, technology and innovation as tools that can be leveraged to solve the problem of poverty, along with the importance of South-South cooperation in increasing scientific knowledge to advance the most vulnerable countries.  Unsustainability is a crucial topic for developing countries, with increased vulnerability due to debt revealing the fragility of international financial architecture.  While there are tools available including servicing or suspending debt multilaterally or bilaterally, they have proven to be insufficient due to flaws in design and implementation.

DESIRE WULFRAN IPO (Côte d’Ivoire), associating himself with the Group of 77 and the African Group, said the pandemic has highlighted existing links between the social, economic and environmental dimensions of sustainable development.  As such, all funding flows should be directed to those three areas concomitantly.  It is also necessary to promote tax adjustment policies and combat illicit financial flows, which are causing the African continent to lose nearly 4 per cent of its GDP.  Côte d’Ivoire is engaged in a resource mobilization process to finance its development plan for 2021-2025, aimed at accelerating the country’s economic and social transformation.  In that regard, it is organizing a meeting of donors in June in Abidjan, he said, inviting Member States to take part in it.  He urged developed countries to honour their commitments to allocate 0.7 per cent of their gross national income to ODA.  He called for the relieving of debt burdens of developing countries to enable them to free up fiscal space for investment in social protection and climate resilience.  His country will host the fifteenth session of the Conference of the Parties to the United Nations Convention to Combat Desertification on 9-21 May, he said, inviting Member States to take part.

MOHAN PIERIS (Sri Lanka) said the pandemic has left developing countries “scrambling” to make ends meet”, with many States at risk of unbearable debt burdens as a result.  Pointing to a great financial divide, he noted that developed countries were able to fund their pandemic recovery with record sums borrowed at ultra-low interest rates, while developing States spend billions in servicing debt, making it impossible for them to invest in sustainable development.  Moreover, when developing countries place their investments with multilateral financial corporations, the interest rates they are offered are dismally low.  As well, ratings companies continue to dismiss developing countries “as if the world was perfectly normal”, he said, adding that that their plea for a debt moratorium from international lenders “fall on deaf ears”.  The global vaccination gap, climate change and funding gaps are global issues, which require global solutions, he stressed.  “The crisis they say provides an opportunity to build stronger […] How can that be so when developing countries’ economies are bleeding?” he lamented.  The pandemic, global tensions, supply chain disruptions and rising inflation have damaged his country’s domestic economy and its growth prospects — a predicament faced by other developing nations, he said, urging developed countries to come to their rescue.