Speakers Urge Global Cooperation to Restructure Debt, Revitalize International Trade, in Lead up to Fourth International Conference on Financing for Development
With two months to go before world leaders meet in Seville to discuss financing for development, speakers at an Economic and Social Council forum on that topic put forth an urgent call for global cooperation in restructuring debt and revitalizing international trade.
“We desperately need a more affordable debt architecture: it's that simple,” Robert Rae (Canada), President of the Economic and Social Council, said in his opening remarks at the Forum on Financing for Development Follow-up. The theme of the Forum, which is taking place 28 to 29 April in New York, is “Our joint ambition for the fourth International Conference on Financing for Development”. That Conference will be held in Spain, from 30 June to 3 July.
Mr. Rae noted that over 3 billion people live in countries where Governments are spending more on interest payments than on health or education. He also said it is vital to reduce barriers to trade — rather than increasing them. Expressing concern about the United States Government’s recently announced tariffs, he said: “Trade is not a four-letter word.” It is essential to reject the idea that “some countries win from trade and other countries lose”.
With $1.4 Trillion in Debt-Servicing Costs, Developing Countries Need Commitment for Lower Borrowing Costs, Improved Debt Restructuring
Fair trade is, in fact, a prime example of the benefits of international cooperation, added António Guterres, Secretary-General of the United Nations, in his opening remarks. He outlined three key areas to focus on during the negotiations towards the final outcome document of the Seville Conference. First, the Conference should emerge with a commitment by Member States to lower the cost of borrowing and improve debt restructuring, he said. Debt service for developing economies has soared past $1.4 trillion a year.
Second, the Conference must unlock the full potential of international financial institutions. “If finance is the fuel of development, multilateral development banks are its engine. And this engine needs revving up,” he said. The draft outcome document of the Conference calls for making these banks bigger and bolder, he said, adding: “We will keep pushing to triple [their] lending capacity.”
Finally, the Conference must mobilize concrete action to increase all streams of finance, he said. At the country level, Governments must channel domestic resources towards critical systems like education, health and infrastructure and at the global level, an inclusive and effective global tax regime is needed to ensure that international taxation rules are applied fairly and effectively.
Global Collaboration Being Questioned, Yet Global Solutions Can Tackle Global Problems
The international community faces some harsh truths — from donors pulling the plug on aid commitments to an annual financing gap of an estimated $4 trillion. The most dangerous is “the harsh truth that global collaboration is being actively questioned,” the Secretary-General said. But, only global solutions can tackle global problems like poverty, hunger and the climate crisis — so “let’s keep our ambitions high”, he said.
Philèmon Yang (Cameroon), President of the General Assembly, also pointed to the “debt trap” — when countries have to spend as much as 20 per cent of their revenue on servicing their debt, it is depleting their funding for sustainable development. In the meantime, the inability to reform the international financial architecture is severely restricting capital access, he said.
Closing $4.2 Trillion Annual Funding Gap Key to Achieving Sustainable Development Goals
He, too, highlighted the $4.2 trillion per year financing gap, and added that progress across the entirety of the Sustainable Development Goals (SDGs) hinges on closing it. “We must work together to unlock the flow of capital, investment and official development assistance (ODA) to developing countries,” he said.
Host Country Speaker Says ‘Cooperation Will Take Us Further than Competition’
“What's at play in Seville” is trust, said Eva María Granados Galiano, Secretary of State for International Cooperation of Spain, the host country of the fourth International Conference on Financing for Development. Highlighting the need to reinforce trust between different global actors, she said: “Cooperation will take us farther than competition.” From the annual spring meetings of the World Bank Group last week to the intergovernmental negotiation to draft a UN Framework Convention on Tax Cooperation, Spain is working very hard across different fora and different levels, to move towards a new financing paradigm.
Noting that the Seville Conference is the last one on financing for development before 2030, she said it is an opportunity to show that “the political will of our countries to improve the lives of people is stronger than the difficulties or the uncertainties that we face”. Seville must become a moment of true solidarity — the commitments made at the Conference should be accompanied by a follow-up mechanism to ensure accountability and implementation, she said.
There will also be a “Seville platform for action” to mobilize partnerships and voluntary initiatives for countries and organizations that want to go beyond the declaration that will be adopted at the Conference, she announced. “We hope that Seville will give us that paradigm shift that we want,” she said.
Draft Outcome Document of Conference Calls for $4 Billion Annually, Particularly for Most Disadvantaged, Marginalized Sectors and Communities
Zéphyrin Maniratanga Permanent (Burundi), Co-Chair of the Preparatory Committee of that Conference, also spoke today. He welcomed the presence of finance and foreign affairs ministers at the Forum, adding that “it is you who will give life” to the outcomes of the Conference, through national development plans. The final draft document for the Conference calls for the mobilization of an ambitious $4 billion per year, he noted, adding that this means the international community needs to free up resources on a huge scale “particularly for the sectors and communities left furthest behind”.
Increasing access to affordable financing and reforming the international financial architecture will give countries the capital and the political space to build resilient economies. These priorities must not remain merely abstract concepts, he added.
Rui Vinhas (Portugal), his fellow Co-Chair, noted the participation of civil society, as well as the engagement of various non-State stakeholders, including the Executive Directors of the International Monetary Fund (IMF) and the World Bank, and representatives of the Bretton Woods Institutions. Their involvement will help “close the gap between New York, Geneva and Washington, D.C.”, he said.
Ministerial Fireside Chats Held Today
He drew attention to the fireside chats to be held throughout the Forum — these will delve into pressing issues in the financing for development landscape, such as development cooperation, debt sustainability, mobilizing private finance, the role of trade and technology, and investing in data to accelerate sustainable development. “These are not technical discussions,” he said, adding that they will “go to the heart of what countries and citizens require to achieve sustainable development: fiscal and policy space, international support and an enabling global environment”.
Chat 1: Lowering Borrowing Costs and Advancing Development-Oriented Debt Solutions
The first of five fireside chats held today, on “Lowering borrowing costs and advancing development-oriented debt solutions”, was moderated by Claver Gatete, Under-Secretary-General and Executive Secretary of the Economic Commission for Africa (ECA). Speakers included Gareth do Espírito Santo Guadalupe, Minister for Finance of São Tomé and Príncipe; Rania al-Mashat, Minister for Planning, Economic Development and International Cooperation of Egypt; and William Roos, Assistant Secretary for Multilateral, Development and Trade Affairs, Treasury, of France.
They considered international and national efforts to support preventative debt measures, such as State-contingent debt instruments, including climate-resilient debt clauses. Highlighting the need for mechanisms that can lower borrowing costs for developing countries, they called for steps to ensure sovereign debt restructurings.
Chat 2: Mobilizing Private Investment to Drive Impact
Mr. Gatete also moderated the next fireside chat on “Mobilizing private investment to drive impact”. Speakers included Jozef Síkela, Commissioner for International Partnerships of the European Commission; Diana Janse, State Secretary for International Development Cooperation of Sweden; and Tatiana Rosito, Secretary for International Affairs, Ministry of Finance of Brazil.
Their discussions centred on key policy frameworks needed at the national and global levels to scale up private investment in sustainable development. They underscored the need to make blended finance more effective in attracting private capital, and highlighted the need for innovative financing instruments.
Chat 3: Revitalizing Development Cooperation for Impact and Inclusion
The fireside chat on “Revitalizing development cooperation for impact and inclusion” was moderated by Navid Hanif, Assistant Secretary-General for Economic Development, Department of Economic and Social Affairs. Speakers included Stine Renate Håheim, State Secretary for International Development of Norway; Kenyeh Laura Barlay, Minister for Planning and Economic Development of Sierra Leone; Aleksandr Pankin, Deputy Minister for Foreign Affairs of the Russian Federation; and Fahad Hamad al-Sulaiti, Director-General of the Qatar Fund for Development, Qatar.
Reducing fragmentation is key to enhancing impact of development cooperation, they said, while stressing that financing for global public goods must be expanded, without compromising effectiveness.
Chat 4: Harnessing Trade and Technology for Sustainable Development
The fireside chat on “Harnessing trade and technology for sustainable development”, moderated by Mariana Mazzucato, Professor, Economics of Innovation and Public Value, University College, London, featured the following speakers: Fatoumata Bako Traore, Minister for the Budget of Burkina Faso; Ismaël Nabé, Minister for Planning and International Cooperation of Guinea; and Steven Collet, Deputy Vice-Minister for Foreign Trade and Development of the Netherlands.
Against the background of rising trade restrictions and technological fragmentation, they stressed the need to ensure that trade remains an engine of sustainable development. They also highlighted the role of multilateral institutions in ensuring that trade and technology policies work together to drive inclusive growth.
Chat 5: Investing in Data to Accelerate Development
Ms. Mazzucato also moderated the fireside chat on “Investing in data to accelerate development”. Speakers included Seedy Kaita, Minister for Finance and Economic Affairs of the Gambia; María Luisa Ramírez Coronado, Vice-Minister for Foreign Affairs of Guatemala; Dehpue Yenpea Zuo, Deputy Minister for Economic Management, Ministry of Finance of Liberia; and Dana Emad Hamza, Assistant Under-Secretary for Sustainable Development, Ministry of Sustainable Development of Bahrain.
Highlighting data gaps in gender, climate change and governance, they called for effective strategies to integrate non-traditional data sources, citizen-generated data and remote sensing into national statistical systems. They also stressed the need for governance frameworks to ensure data quality, transparency and ethical use.