UNITED NATIONS, CMC—On Monday, Dennis Francis, President of the United Nations General Assembly (UNGA), said that development financing is essential if the global community is to achieve the sustainable development goals (SDGs) and realize a safer, more equitable future.
“It is high time to honor our commitments and ensure that no country and person is left behind,” the Trinidad and Tobago-born diplomat said at the opening ceremony of the UN Economic and Social Council (ECOSOC) Forum on Financing for Development, which is being held under the theme “Embarking on the path toward the Fourth International Conference on Financing for Development, FfD4.”
Francis told the meeting that the forum and its theme are timely, as the global community faces “a worsening development crisis, and time to overcome it is of the essence.
“Financing challenges are at the very heart of this crisis, poised not only to imperil our 2030 aspirations but the promise of the Addis Ababa Action Agenda on which they stand.
“As we know too well, more than half of the SDG targets have seen weak or insufficient progress. Nearly a third are stalled or in reversal. As the estimates make clear, adequate progress across the SDGs will require trillions in financing annually.”
Francis said that development finance is more needed than ever, particularly for countries in the Global South, adding that the forum offers the opportunity to connect the dots and fill the gaps.
He said this must be done starting with a “relentless focus on the debt crisis,” which is estimated to be worth a staggering US$313 trillion in 2023.
Francis said over the last decade, public debt has increased more rapidly in developing than in developed nations, with external debt stocks reaching an alarming US$11.4 trillion.
“Worse, developing countries are paying twice as much in interest on their total sovereign debt stocks than developed nations, hobbling them further as they try to ascend the development ladder.”
He said that due to these constraints, more than 100 countries have been forced to choose between servicing their debt or investing in their development and their people.
“Meanwhile, nearly half of humanity, or 3.3 billion people, lives in countries that spend more on interest payments than on education or health. How do we expect countries to thrive under these conditions?
“No nation, I repeat, no nation, should be forced to gamble with its future. It is precisely for this reason that I organized a high-level thematic debate on debt sustainability and equality for all during the General Assembly’s first-ever Sustainability Week, which concluded last Friday.”
He said as participants made clear, countries must be enabled to channel their resources towards uplifting their communities and building resilience rather than servicing excessive debt.
Francis said that the recent Financing for Sustainable Development Report released by the Inter-Agency Task Force on Financing for Sustainable Development has made it much easier to identify trends.
“First, we know that financing gaps are growing. An additional $4 trillion of investment is needed each year to help developing countries emerge from this vicious cycle, 50 percent higher than pre-pandemic estimates.
“Second, we know the global economic environment is becoming more challenging, amid slack economic growth, tighter financial conditions, and fewer investments.
Inequalities, both within and between countries, meanwhile remain high, with particularly adverse effects on women and children.
“Third, the international financial architecture, established in 1945, only exacerbates these vulnerabilities, constraining access to critically needed development finance and pushing developing countries to borrow from even more expensive sources.”
The Trinidad and Tobago-born UNGA president said that without urgent and necessary reform to the system and the unfair rules that hamper equal access and benefit, developing countries will forever remain trapped in debt and underdevelopment, mired in poverty, hunger, and misery.
“We need resilient development from climate change and biodiversity loss to conflict and fragility, ensuring that countries and people can bounce back from adversity, whatever form it takes.”
He said while looking forward to the outcomes of the World Bank and International Monetary Fund (IMF) Spring Meetings held last week, he believes the ECOSOC Forum is the perfect opportunity to build more momentum to achieve our goals.
“I anticipate that the outcome of this forum will not only build a firm foundation for the Fourth Financing for Development Conference in 2025 but will also provide critical inputs for the Summit of the Future in September, as the last big chances to course correct by the 2030 deadline.
“As the Inter-Agency Task Force report makes clear, there are several actions we must take to bring the SDGs back on track,” Francis said, adding, “First, we must close the financing gaps for SDGs, including climate investments at scale and with urgency”.
He said that upholding the promise of the Addis Ababa Action Agenda and implementing the SDG Stimulus plan means working smarter, faster, and fairer to help developing countries access public and private sector investment.
He also calls for overhauling the global financial architecture to make it work better for all. “The consensus is that the Bretton Woods system, as presently designed, can no longer effect the change for which it was intended over 78 years ago. International financial institutions must be able to support the mobilization of stable, long-term financing at scale – and, in turn, help developing countries achieve debt sustainability and ultimately accelerate the implementation of the SDGs.
“Multilateral development banks must be empowered and supported to do this,” Francis said, adding that “we must rebuild trust not only in our institutions but also in local and national governments.
“By pursuing and building political support for necessary reforms, we stand a much better chance of rebuilding the social contract, among peoples and across societies, that is critical to our success.
“Finally, we must innovate, formulate and finance new development pathways, especially through blended concessional finance, as one of the best ways to increase finance, mobilize private capital, and fast track progress across the SDGs,” Francis added.
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