Conference on Financing for Development
Department of Public Information - News and Media Services Division - New York
|Monterrey, NL, Mexico
18-22 March 2002
21 March 2002
4th Meeting (PM)
CALLS HEARD FOR INCREASED AID TO REDUCE POVERTY AT MONTERREY CONFERENCE
ON DEVELOPMENT FINANCING
Statements Made by 12 Presidents, Prime Ministers
As the International Conference on Financing for Development continued its summit segment this afternoon, bringing together heads of State and government, as well as the leaders of key international financial institutions, delegates called for increased international aid to assist countries in reducing poverty and furthering development.
Today, the call was to fight poverty, Norwegian Prime Minister Kjell Magne Bondevik told delegates gathered in Monterrey, Mexico. No country could remain neutral in that battle, just like no country could stand apart in the fight against international terrorism. "For poverty to go down, aid must go up." His Government was launching an action plan to combat poverty by increasing official development assistance (ODA) from 0.92 per cent to 1 per cent of gross domestic product (GDP) by 2005, advance policy coherence in all relevant government policies, and forgive all debts to countries under the Heavily Indebted Poor Countries (HIPC) Debt Initiative.
Rwanda's Minister for Finance and Economic Planning, Donald Kaberuka, noted that while aid was, and would remain, important for many countries, there was not a country in the world which had eliminated poverty by aid alone. Countries had grown out of poverty by participating fully in world trade and investment. Aid had played a catalytic, but not decisive, role. At the same time, significant aid resources would continue to be needed. His country was prepared to play its part in ensuring that aid was effectively utilized, to enable it to "grow out of aid".
Aid, stated the Finance Minister of Pakistan, Shaukat Aziz, should not be used as a permanent crutch, but as a means to allow the recipient countries to stand on their own feet. Raising the effectiveness of aid by creating a sound environment, an appropriate framework for investment, initiating structural reforms and ensuring good governance and transparency was the prime responsibility of developing countries. They should learn to walk on their own. They just needed help getting there.
"Financing is to development what a steady supply of oxygen is to human life", said the Prime Minister and Minister for Finance of Barbados, Owen S. Arthur. As such, a process of development that could have real meaning in the lives of the poor had remained unfulfilled because of the extraordinary inability of the international community to support development objectives with the necessary means. "Incantations without follow-through were just another way of killing time", he said.
Sweden was prepared to help developing countries in several areas of capacity-building, including in trade-related support and public finance management, its Finance Minister Bosse Ringholm said. This morning, Sweden and the World Bank had signed an agreement for capacity-building support for public expenditure management for Africans who participated in the HIPC debt initiative. His country was also willing to lead the way to set up a task force to examine the role of global public goods.
To meet the challenge of poverty eradication, stated the Foreign Minister of Denmark, Per Srig Moller, the world should know the nature of its poor people. They were the small farmers, the landless labourers, the urban slum dwellers, women heads of household, and people displaced by conflict or natural disasters. Three out of four poor people worked and lived in rural areas. To break the vicious cycle of poverty required focusing much more carefully on rural development, on jobs, small-scale industry and a conducive business climate.
Also addressing the Conference this afternoon were the Presidents of Colombia, Senegal, Panama, Gabon, Algeria, Argentina and Bolivia, as well as the Prime Ministers of Thailand, Chad and Tunisia.
In addition, the Vice-President of the Philippines and the Foreign Ministers of the United Republic of Tanzania, Switzerland, Singapore, Saint Lucia and Cameroon spoke, as did the Finance Ministers of Swaziland, Tuvalu, Saudi Arabia, Bhutan, China, Ecuador, Malta, Bangladesh, Lithuania and Lesotho.
The Conference also heard from the Minister for Regional Cooperation of Israel, Minister for Cooperation and Humanitarian Action of Luxembourg, the State Secretary in the Ministry of Economy and for European Integration of Ukraine, Minister for Planning and Development Cooperation of Suriname, the Senior Minister for Government and Business of Ghana, the Minister of State for Planning of Guinea, Minister for Economic Affairs and Development of Mauritania, and Minister for Development Cooperation of Ireland.
The Governor of the Central Bank of Qatar, Federal Minister for Economic Cooperation and Development of Germany, Secretary of State of the Ministry for Foreign Affairs of Latvia, Vice-Minister for Foreign Affairs of Greece, State Secretary of Austria, Vice-Minister for Foreign Affairs for Foreign Economic Relations of Indonesia and the Vice-Federal Minister for Foreign Affairs of the Federal Republic of Yugoslavia also addressed the Summit.
In addition, the representatives of Kazakhstan, Sri Lanka, Kuwait, Lebanon, Azerbaijan, Nauru, Hungary and the Holy See also spoke.
Also this afternoon, the Conference designated Hazem Fahmy (Egypt) as its Rapporteur-General.
The Conference will continue its summit segment at 9 a.m. on Friday,
Conference Work Programme
The summit segment of the International Conference on Financing for Development met this afternoon to continue its exchange of views.
ANDRÉS PASTRANA ARANGO, President of Colombia, asked what had been done to make the world more just and peaceful -- answering that question was the objective of the Conference. No one could be truly rich if their neighbours were poor, former United States President John F. Kennedy had said. Human beings were a global community that must work so that all could share in the same fate.
He stressed the principle of shared responsibility to confront the challenges facing the world. Financing for development, arms control, the struggle against terrorism, equal access to new information technology, and preservation of the environment were all essential elements in that struggle. There should be a favourable international environment for the competitive insertion of the developing countries into the world economy. He supported the goals related to official development assistance (ODA, foreign direct investment (FDI), and redesigning the international financial architecture. The Monterrey consensus was a key step in the process. International development financing must foster human and social well-being. In a globalized world, equitable financing, cooperation and trade were essential.
He said more than half of his country's population lived in poverty -- this had been caused by the world drug problem and resultant violence. He asked what his country could expect from the international community in that respect. Cooperation to fight the drug problem was essential -- arms sales and money laundering must be addressed. Today's challenge was to ensure that wealth and the resultant well-being would extend throughout the world.
KJELL MAGNE BONDEVIK, Prime Minister of Norway, said that 18 months after the Millennium Summit, the people of the world were looking towards the Monterrey Conference with anticipation. Poverty was the biggest challenge of the time. The events of 11 September had shocked the world. The terrorist attacks were on an assault on everyone who valued life and liberty. Today, the call was to fight poverty -- no country could remain neutral in that battle, just like no country could stand apart in the fight against international terrorism. September 11th also tore down the invisible wall that divided rich and poor. Terrorism was not the voice of the poor, but those events had driven home the recognition that poverty, lack of development and social injustice had to be addressed seriously if the long-term battle against global terrorism was to be won.
He said that halving poverty by 2015 was the centerpiece of the Millennium Development Goals and, therefore, action must be taken to prevent hunger and want, secure dignity for the most vulnerable, create access to basic health and education services for all, ensure freedom of expression without fear or retribution, and grant all people the right and opportunity to engage in economic activity within the rule of law. Eliminating poverty was about ensuring human dignity and fundamental human rights. Success meant focusing on "our own deliverables". His Government had just launched its own action plan to combat poverty by increasing ODA from 0.92 per cent to 1 per cent of gross domestic product (GDP) by 2005, to advance policy coherence in all relevant government policies, and to forgive all debts to countries under the Heavily Indebted Poor Countries (HIPC) Debt Initiative.
The new action plan also pledged the Government to work hard to improve international debt service arrangements, stimulate the private sector, implement zero tariff-market access to all products from the least developed countries except arms, and seek to increase market access for agricultural exports from those countries. None of the Millennium Development Goals could be reached without major efforts both in the North and South, he said. Good governance, transparency and accountability were prerequisites for development -- there, the developing countries would have to do better. The outcome text also focused on the imperative need for improved donor coordination -- there, the developed countries had to deliver. The debt burden must be eased and the HIPC Debt Initiative fully financed.
He said that development assistance was crucial. "For poverty to go down, aid must go up." There was a need to at least double the present level of ODA, but donor countries provided only one third of the aid to which they had committed, or 0.22 per cent of the GDP. Only five countries had reached the target of 0.7 per cent for ODA. The Monterrey consensus demonstrated that the international community was in basic agreement on the means to eliminate poverty, but lacked sufficient political will to mobilize the necessary resources. Monterrey must be used to mobilize those resources; that would mean real improvements for people. In that regard, he welcomed the announcements by the United States and the European Union to increase ODA, and urged all donor countries to set specific deadlines and indicate timeframes to increase their ODA towards 0.7 per cent.
THAKSIN SHINAWATRA, Prime Minister of Thailand, said that, in addition to traditional models of socio-economic models of development, new models must also be explored. Poverty must be eradicated with new and innovative approaches. His Government had emphasized an "outside-in" approach to tackling the nation's problems. It had sought the input of the people regarding the main problems they would like the Government to solve and had incorporated them into the government policies. The promotion of micro-financing and micro-credit was one of the highlights of his country's economic policies.
Equal emphasis, he said, had been placed on the revival of the agricultural sector, and debt relief programmes had been implemented. The introduction of village revolving funds had provided a source of financing for rural development projects. Also, the establishment of a people's bank for small-scale borrowers had provided financing for development at the smallest unit of production. The Government was mindful of the fact that mutual assistance and cooperation provided the best avenue for prosperity and had tried to reach out to neighbouring countries.
His country, he continued, stood ready to share with its development partners expertise, such as that concerning its war on drugs. It had provided crop-substitution programmes both within the country and in neighbouring countries to provide alternative sources of income. It was hoped that the industrialized nations would provide some support to those who were less fortunate, which would help developing countries become better partners of the developed world in the future. In closing, he announced that Thailand would host the United Nations Conference on Trade and Development (UNCTAD) Mid-term Review in Bangkok from 29 April to 3 May, with a ministerial round table to assess progress since UNCTAD X.
ABDOULAYE WADE, President of Senegal, said that, while the objective of 0.7 per cent ODA had not been achieved, even if it were reached today, what would have been resolved? At the pace at which ODA was evolving, it would only reach the 0.7 per cent objective in another 30 years. Assistance was always a sacrifice on the part of the populations that rendered it, he noted.
Assistance could only be the fine-tuning of a system that was functioning, not the basis for it. Developing-country debt had grown tremendously, he noted. He called for imagination and new initiatives such as the New Economic Partnership for African Development (NEPAD), with its focus on partnership with both the public and private sectors. In April, Senegal would host a conference with the private sector on financing NEPAD. The private sector had developed Europe, Japan, the United States and other countries -- Africa should move in that direction.
He said public assistance resources should go to education and training to help build national infrastructure. He supported the notion, put forward by United States President George Bush, that development resources should be distributed 50 per cent for grants and 50 per cent for loans. The Conference could only be a success if it did not limit itself to general principles, he said. He stressed the need to look at the situation of each country individually. Africa's problems related to the conditions for receiving capital flows. That must be redressed.
ABDELAZIZ BOUTEFLIKA, President of Algeria, said that development financing was a major undertaking. It was essential to spread prosperity and reduce poverty. The political dimension of that endeavour had been ensured for the first time at the highest levels through the Monterrey Conference. It offered an opportunity to achieve more transparent objectives, which were free of the restrictions that had impeded global trade. The work should also mark an important stage in contributing to the success of the next major meeting in Johannesburg, aimed at promoting sustainable development and preserving the environment.
He said that financial and monetary spheres were often marked by instability. That underlying problem was not characteristic of any particular country or region. Indeed, the debt problem, massive speculative capital flows, money laundering, and financing of terrorism were incontrovertible symptoms of the poor global monetary system. Crisis management had shown its limits, as seen by the recurrence of crises. A framework must be identified for national and international nation action, in order to improve and sustain the monetary architecture. That meant action to address all factors that impeded sustained development. Also, the distinction between financial and real economies must be made. The "disconnect" between those two spheres had generated disorder, imbalance and crisis.
Also important was strengthening national, regional, and international financial institutions, he said. That meant transforming a world economy that was based on over-indebtedness and exploitation to, among other things, a vastly improved environment for direct investment flows. Those were among the areas in which there must be resolute and sustained commitment, and the implementation of appropriate policies at the national, regional and global levels. A State must ensure that it met the imperatives of sustained growth by creating jobs and reducing poverty under general conditions of stability. Regionally, decisive efforts should be made towards a convergence of monetary and fiscal policies, and strengthening cooperation was essential to promoting investment flows. Globally, existing institutions should be adapted to the requirements emanating from the globalized economy. He welcomed the recent announcements to increase ODA, but hoped that the 0.7 per cent target would soon be reached.
MIREYA ELISA MOSCOSO RODRÍGUEZ, President of Panama, said her country had lived and suffered through all possible models -- totalitarianism, socialism and capitalism. It had finally accepted an economic model, which favoured the better flow of resources and greater production and consumption.
Developing countries, she stated, were opening up their economies to free competition -- to countries with technology and knowledge that was out of their reach. Even then, developing countries were being asked to do more. While industrialized countries had used up most of their resources, developing countries were told to decrease the use of their own natural resources. Also, standards of efficiency and transparency were being imposed on developing countries that developed countries themselves were not abiding by. Democracy was about knowing the needs of people. Time must not be wasted in forums, such as the Conference, with mere declarations.
International cooperation was a fundamental aspect of any model which would encourage development, she said. She applauded the summit, which allowed for the frank discussion of topics, which could not be expressed so freely in other forums.
MOHAMED GHANNOUCHI, Prime Minister of Tunisia, said he hoped the Conference would contribute to progress and well-being for humankind, within a climate of coexistence, cooperation and solidarity. Tunisia was aware of the need to mobilize national resources and reinforce foreign investment to develop the economy and achieve prosperity, as well as the need to carry out a fundamental and comprehensive reform at the national level and to initiate a true partnership for peace and development.
He called for the necessary practical measures to enable all States to keep abreast of technological progress and to take advantage of the broad perspectives provided by the information revolution and quickening economic changes. In that context, he noted Tunisia's initiative to host an international summit on the "Knowledge Society" in 2005.
He called for the developed countries to reach the 0.7 per cent ODA target. He also stressed that there should be preferential treatment for developing countries by the World Trade Organization (WTO). Tunisia had warned of the seriousness of the debt burden on developing countries. He expressed his appreciation to all countries that had partially or totally cancelled their debt and called on others to do the same. Countries with a medium income should do the utmost to effect the necessary structural reforms to help their economies. Coherence in development policies across the world and coordination between governments and institutions was key. The United Nations was the appropriate forum to promote such cooperation.
EL HADJ OMAR BONGO, President of Gabon, said that, for a number of years, meetings on development had been organized all over the world. Each time, those meetings had led to a tremendous amount of hope and had led African countries to implement economic and social reforms, which they were assured were absolute requisites. Such meetings were no more than media meetings unless they provided real prospects for nations. Although developing countries had shown real commitments to support development and fight poverty, that commitment was not matched by their partners.
It was hard to imagine that Africa, which constituted 10 per cent of the world's population, only had 2 per cent of world trade. It would be impossible to build a democratic and peaceful world if it was poor. There could be no democracy or peace without an improvement in the quality of life. In order to halve poverty between now and 2015, countries must be equipped with the real means and tools to reach that goal.
Democracy resided in Africa, he stated. African countries were repaying their debt. Regional integration was becoming organized. The NEPAD had focused on issues such as the mobilization of ODA, the debt burden, combating HIV/AIDS and malaria, and access to markets. The international community would never reach its objectives without true harmonization of policies -- economic, political and cultural. Gabon and Africa could not disappear nor stay on the sidelines of the changes occurring in the world. He hoped the consensus would lead to a new era of cooperation for everyone.
NAGOUM YAMASSOUM, Prime Minister of Chad, said that the Conference had attested to the international community' commitment to greater humanity, but it was more urgent than ever now to go beyond conferences and concepts "get down to action". Tons of development schemes had been prepared for the third world, aimed at integrating those countries into the world economy. Some had succeeded, but most had fallen short, as developing countries had been unable to create enabling environments; many had become even more bogged down in underdevelopment. That was particularly visible in Africa, where the problems had persisted, if not increased. In fact, many of the 49 least developed countries were in Africa.
He recalled that Africa reacted recently by committed itself to far-reaching reforms. Of course, the results were still unknown. To formalize that commitment, African leaders adopted the NEPAD initiative, formed by Africans for Africans. For its part, Chad, a landlocked State in the heart of Africa beset by all kinds of natural disasters, such as drought and disease, was resolutely part of that new initiative. It had committed itself resolutely to build a society based on liberty and law. It had succeeded in realizing its dream of exporting oil. Chad had tried to redress itself politically and economically and thanked all its bilateral and economic partners for their support of such endeavours. The right foundations had been laid in Chad and could not be destroyed. It was now a matter of correcting the shortcomings in order to forestall unforeseen ills. The initiatives announced by the United States and the European Union were welcome.
OWEN S. ARTHUR, Prime Minister and Minister for Finance and Economic Affairs of Barbados, said that, in a world impatient for progress and endowed with the means to achieve that progress for all, the mere statement of lofty goals and objectives could no longer suffice. "Financing is to development what a steady supply of oxygen is to human life", he said. As such, a process of development that could have real meaning in the lives of the poor had remained unfulfilled because of the extraordinary inability of the international community to support development objectives with the necessary means. "Incantations without follow-through were just another way of killing time", he said. So, it had been in the realm of the global development agenda.
The Conference, which was conceived to support the statement of a global development programme with the mobilization of the resources necessary to ensure its realization, was, therefore, a historic necessity, he said. It could, as never before, provide an opportunity to reconcile the ends and the means of global development and give humankind the first realistic chance to achieve humane and civilized development. Many of the issues at the heart of development financing had to do with the quality of global economic and financial governance, he noted. The challenges of civilized globalization could not be adequately handled by an international financial system designed for the world of 50 years ago.
The Conference provided the international community an opportunity akin to that of Bretton Woods to conceive a new international financial system to serve for a generation, he said. The consensus had not gone far enough in conceiving a new system to redress the imbalances of the old. As such, proposals had emerged that must not be allowed to go away -- the creation of a rules-based world financial authority to better supervise today's more complex global financial and capital markets than the Bretton Woods institutions; an international tax organization to oversee global cooperation in cross border tax matters; new ways of raising global revenue to finance global public goods and to eradicate poverty. The consensus, in his view, reflected a work in progress -- a beginning rather than an end.
EDUARDO DUHALDE, President of Argentina, said his country was in crisis. It had, therefore, decided to put an end to the fiscal disorder, which, combined with an unfortunate monetary and exchange system, had led to the greatest recession in Argentine history. It had decided to replace the old order with a system based on the following macroeconomic foundations: a balance public budget; a single currency; a floating exchange rate; and progressive elimination of financing and payment restrictions. In that way, it hoped to build a competitive market economy to get back on the path of growth and integration into the world. The transformation being undertaken needed the understanding and cooperation of the international community.
The consensus was the most serious attempt, in a long time, to discuss issues related to the development process, he said. All present agreed that freedom, democracy, cooperation, a market economy and equitable distribution of wealth were the basis and, at the same time, the instruments that must be used to discuss the problems of development. Difficulties in market access, protectionist policies, corruption, terrorism, lack of training, among others, were factors that prevented the world from enjoying the benefits promised by globalization, he said. For that reason, the gap between many emerging economies and developed countries had not been reduced. On the contrary, it seemed deeper by the day.
"We are not asking for compassion, but for a new global context", he said. A new architecture for development would not be possible if the rich economies did not reduce protectionism in all its forms. Aid could not be efficient in a context of severe trade distortions, mainly in the agricultural sector. He hoped the negotiations started in Doha could help improve the situation of emerging economies. Changes were also needed in the way that multilateral credit agencies worked. He urged the International Monetary Fund (IMF), the World Bank and the WTO to cooperate in the design of preventive and anti-cyclical policies to assist those sectors that had been greatly damaged.
JORGE QUIROGA RAMÍREZ, President of Bolivia, said that the figures were clear -- thousands of millions of citizens had known only poverty. The challenges of the twenty-first century were also clear -- to reduce poverty, drug trafficking and terrorism. Those ills could only be vanquished with development, freedom and the rule of law. Bolivia needed financing for development, access to markets for its products, and integration into the digital world. It was important to ensure that the resources earmarked for development reflected the social reality of the recipients and not the convenience of the donors.
He said that, in Bolivia, the financing should be done through its poverty- eradication policy. Bolivia was opening its door to civil society in order to define how those resources should be used. That would be done gradually, so that indigenous and rural populations would be able to receive more funds. The international community should offer resources that were not tied to the provision of services from the donor countries, but under a single coordinated framework. That process would be based on results in terms of schools, housing, and vaccinations. Bolivia had exceeded the 18 goals set out in the first HIPC Debt Initiative plan four years ago. In light of that experience, he supported the idea that cooperation should be based on tangible results. The key question was whether that system could be used to solicit untied aid that was coordinated and results-based.
Corruption cut down on resources to fight poverty; poverty weakened and destroyed States and provided fertile ground for terrorism and drug trafficking. So, corruption must be defeated with the same force used to combat drug trafficking and terrorism. A number of things had been done to combat corruption in Bolivia. For example, it was decentralizing public investment and aiming it at social programmes. Reform of the judicial system and institutions was also under way. Something was missing, however, and that was access to markets in the agricultural sectors and labour-intensive markets.
"We shaped up and now we are frustrated that, in the football match of world trade, the rules are constantly changing", he said. Many manufacturing players were not even permitted to use their feet to score goals. It was time to foster free trade, free of tariffs and subsidies and free of para-tariff controls, he urged. There was no financing for development if there was no opening of markets for development. Regarding digital integration, the digital divide tomorrow would leave thousands of educated citizens in a sort of "digital illiteracy".
CHARLES GOERENS, Minister for Cooperation and Humanitarian Action of Luxembourg, said poverty eradication was not an illusion. Together with others in the European Union, Luxembourg did not wait for the tragic events of 11 September to realize the need for structural changes. Official development assistance levels had declined to critical levels. His Government, which had regularly increased its ODA, hoped to reach a level of 1 per cent by the end of the decade. In that context, he welcomed the recent conclusions of the European Council, which met in Barcelona, to increase the average ODA of European Union member States to 0.39 by 2006.
He believed the consensus was inclusive and balanced because it set out a number of proposals to mobilize resources in financing development. It was important for developing countries to carry out reforms to establish good governance and combat corruption, among other things. The international community would be judged based on its actions after Monterrey. The objectives of sustainable development and poverty eradication must be supported by policies pursued at the multilateral level.
TEOFISTO T. GUINGONA, JR., Vice-President and Secretary of Foreign Affairs of the Philippines, said the commitments made to promote technology transfer to developing countries had, for the most part, remained promises in favour of profits. A developing nation like his wanted technology in order to lift itself out of poverty. It would implement policies to make technology transfer from rich nations more convenient. It would build roads, communication channels and infrastructure needed to support an information technology industry.
In 1997, his country was on the way to progress, he said. However, in July of that year, a severe financial crisis struck the country. Today, 40 per cent of Filipinos were poor. In the wake of continuing crisis, he suggested that his country's creditors give it a rational swap -- debt for technology transfer.
Instead of servicing debts for one year, he continued, the country should be allowed to utilize the equivalent fund for technology transfer, education and social services. "When you transfer technology to us, you empower us. When you sell pharmaceuticals at affordable prices, you alleviate pain and save lives. When you swap debt for housing, modernized agriculture and fisheries, you open the windows of opportunity."
MAJOZI V. SITHOLE, Minister for Finance of Swaziland, associated his delegation with the statement made during the morning meeting by the President of Venezuela for the "Group of 77" developing countries and China. He said that behind the overall positive picture of globalization were a number of persistent imbalances threatening the stability of the present growth path. Developing countries, including Swaziland, had continued to be confronted with dwindling private financial flows and ODA, limited market access, non-competitive prices for goods sold in overseas markets, high levels of poverty and HIV/AIDS, and a recurring budget deficit. His country had devised a National Development Strategy, which was consistent with the Millennium Development Goals.
The HIV/AIDS pandemic had, however, continued to be a major threat and set back to his country's efforts, he said. The Government had, therefore, set up an Emergency Response Committee to coordinate implementation of an HIV/AIDS strategic plan. A fund to fight the disease had also been set up. Developing countries like his own were conscious of the need to accelerate the pace of mobilization of domestic resources to promote high investment. However, the provision of additional finance from the developed world to augment the existing finance in the developing world was essential.
In that context, Swaziland had embarked on a major drive to mobilize resources to finance national infrastructural projects, he said. With the assistance of the United Nations Development Programme (UNDP) and the World Bank, it was preparing for a donor round table to be held in June or July in Geneva to solicit financial support from the international community. The importance of trade to sustainable development and poverty alleviation could never be over-emphasized, he added. In that regard, he welcomed the endeavour to open markets in the developing world, as it had become clear that trade barriers made it difficult for the developing world to succeed in the trade arena.
DONALD KABERUKA, Minister for Finance and Economic Planning of Rwanda, said aid was, and would remain, important for many countries. However, there was not a country in the world which had eliminated poverty by aid alone. Countries had grown out of poverty by participating fully in world trade and investment. Aid had played a catalytic, but not decisive, role. At the same time, significant aid resources would continue to be needed. His country was prepared to play its part in ensuring that aid was effectively utilized, to enable it to "grow out of aid".
A new compact between poor and wealthy countries was needed that stated that if the conditions were right, the international community would provide the resources in a flexible and predictable manner. Such a compact was articulated in NEPAD, by which Africans were prepared to take charge of their future. The Millennium Goals could only be met if: conditionalities were replaced by ownership; inconsistencies in policies, both in donor and recipient countries, were removed; the costs of giving and receiving aid were reduced; and the voice of poor countries was effectively taken into account in international forums.
RONI MILO, Minister for Regional Cooperation of Israel, said that the Monterrey consensus was an important road map for the work ahead towards eliminating poverty and consolidating economic independence for all nations. A number of activities at Israel's Center for International Cooperation had been instituted to promote the values echoed in the summit. The individual programmes not only worked to transfer basic technologies and capabilities for sustainable growth, but also sought to implement a number of principles mentioned at the summit so far. Israel was reinvesting part of its ODA in support of programmes designed to address cardinal issues of development.
He said that such investment had a self-reinforcing effect and created a positive dynamic of growth and development. Since 1999, statistics had shown a steady increase in the sums allocated to development assistance, reaching the level of 0.15 per cent in 2001. Indeed, Israel was taking its place among the donor nations compatible with its economic situation. Among other things, it had begun participating in the HIPC Initiative of the World Bank, assisting certain countries in reducing their debt. He stressed Israel's perception that the promotion of joint projects and the consolidation of economic ties were important to the attainment of peace globally and in his region. Increasingly, the trade and investment between States and peoples in the region would help build more competitive economies and enhance interaction between communities.
SAUFATU SOPOANGA, Minister for Finance, Economic Planning and Industries of Tuvalu, said he hoped that strong political will would emerge from the Conference to address poverty and create equitable conditions for all. The consensus document's goals were well formulated. Its success would be judged on the partnerships developed and the actions taken.
Tuvalu was committed to the principles of good governance, the rule of law and the rights of citizens. It was committed to prudent management of finances and to working together with development partners to improve its systems. Like other small island developing States, the situation of Tuvalu was defined by its size and the conditions it faced, including global warming and rising sea levels. Official development assistance was essential to States like his. While grateful for the aid his country had received, he was concerned by the overall decline in ODA in the world. In the event of continuing reduction in aid, all efforts to fight poverty must be welcomed. The United Nations could not afford to ignore the Republic of China on Taiwan's contribution to development, he added.
Projects with local ownership had higher chances of success than those formulated without proper dialogue, he said. He stressed the importance of regional partnerships in addressing poverty. The role of overseas employment was also vitally important to countries like his, and he called for innovative schemes in that regard. While each country had responsibility for its development, for States like his, economic growth and development were constrained by the realities of life. Left on their own, their survival could not be assured.
JAKAYA M. KIKWETE, Minister for Foreign Affairs and International Cooperation of the United Republic of Tanzania, said the implementation of the Millennium Development Goals would require substantial, new and additional resources from both domestic and external sources. The World Bank estimated that $30 billion would be required annually for a period of 30 years to meet that goal. The United Nations estimated that some $50 billion would be required annually up to 2015, of which $10 billion would be spent on stemming and reversing the surge of HIV/AIDS. Fortunately, the world was tremendously wealthy. What was $50 billion to the European Union, which spent $1 billion a day on agricultural subsidies which they could do without?
The role of FDI as an important instrument for implementing the Millennium Development Goals could not be over-emphasized. Low levels of FDI to the developing countries were not justifiable and, if left to continue, the poverty situation in developing countries would not change. He appealed to developed countries to take a more proactive role in encouraging their private sector to direct more investment to developing countries. The media also had an important role to play in that regard. The Western media, for example, could give a place to the numerous positive things happening in Africa instead of always portraying it as a continent of conflicts, diseases and hunger.
The Monterrey consensus was so critical to the international community's common future that "we cannot afford to fail". The Conference represented a new dawn in the new millennium. He expected to see demonstrable commitment on the part of the developed countries to increase resources for the fight against poverty. He also expected that the developing countries would make strong commitments to do their best to increase domestic resource mobilization, uphold the principle of law and good governance, intensify the fight against corruption, and put in place a conducive environment to improve effectiveness of aid and attract investments.
IBRAHIM AL-ASSAF, Minister for Finance and National Economy of Saudi Arabia, said that the Conference was the first step in ensuring that the twenty-first century would be the century for the development of all. The success of the development process would hinge on the international community's respect of the specific qualities of each country. Policies which negatively affected some countries and some products must be avoided. Existing development institutions, such as the Bretton Woods institutions, must be revitalized.
Peace and development were interdependent, he noted. Development would be set back without peace. For example, without a lasting peace, the people of Palestine would not be allowed to achieve development. In that regard, he underscored the recent initiative of the Saudi Crown Prince, which had been received warmly.
He said that domestic resources were the main resources for the achievement of development. All existing institutions must encourage savings and investment. At the same time, he was aware of the role of international trade, which was the engine of development. However, the obstacles placed in the path of developing countries undermined that potential. Subsidies and barriers placed on certain products served as impediments to development. Saudi aid, the bulk of which was provided by the Saudi Development Fund, was not subject to conditionalities, and a high proportion of it was in the form of grants.
LYONPO YESHEY ZIMBA, Minister for Finance of Bhutan, said the problem of poverty and underdevelopment went unabated, and the long-awaited increase in resource transfer had not yet happened. At the same time, ODA was falling, hitting hardest the weakest and most vulnerable. He agreed that developing countries should not depend fully on ODA; that it should supplement domestic efforts. The developing world had the responsibility to frame sound policies, enhance good governance and carry out much-needed reforms. It must be able to enhance self-reliance and use ODA for its intended purpose.
He said his Government had spared no effort to mobilize domestic resources and enhance its national self-reliance. In spite of its late start, the development process had yielded excellent results, thanks to the unique development philosophy called "Gross National Happiness", which called for balanced and people-centred development. Bhutan had been able to tread that path of development with success because of the generous, though limited, support received from its development partners. The onus of development could not be placed on those partners only; recipient countries must assume full responsibility for their country's destiny. Foreign direct investment and trade accrued benefits mainly for more developed States where higher profits were likely.
Smaller, landlocked countries with limited resources and rugged terrain did not hold out much hope for FDI, he said. Hence, there was no alternative to ODA, at least in the near future, for those countries, including his own. In light of the announcements made by the European Union and the United States to increase ODA, he believed that the Conference was, indeed, a worthwhile attempt to reverse the otherwise sad trend of declining ODA. While the commitments fell far short of the needs, it had, nonetheless, rekindled hope and belief in international goodwill. He also commended the Nordic countries for taking the lead in increasing ODA. It was now up to the donor nations to disburse what they committed, otherwise, the past might repeat itself. And, they must be more flexible when it came to conditionalities and selectivity.
XIANG HUAICHENG, Minister for Finance and Representative of the President of China, noted his nation's firm commitment to development. Peace and development were the common aspirations of the entire world, but conflict and unrest were not yet things of the past. Poverty must be eradicated and the benefits of the world economic system shared equitably. Development needed financial resources.
He called for the establishment of a global framework for financing for development. Such a mechanism would establish a new international economic order that harmonized with globalization to provide a favourable environment for all countries to develop their full potential. Developed countries should assume special responsibility in ensuring the development of developing countries. Regional cooperation should be enhanced to promote both North-South and South-South cooperation.
Official development assistance to developing countries should be increased considerably, he stressed. Doing so was essential for creating an equitable world economic system. All should, therefore, strive to reach the target of 0.7 per cent.
Country ownership of development should be strengthened, he said. Financial and technical assistance to developing countries should be increased. China would stand by all the peace-loving people of the world and would strive for common development and prosperity.
VOLODYMYR PERSHYN, State Secretary, Ministry of Economy and for European Integration of Ukraine, said the implications of the terrorist attacks of 11 September had shown how economic and political realities were interrelated. There was now an opportunity to achieve the important goal of halving the number of poor people. The Consensus was the result of the hard work and cooperation of all participants of the Preparatory Committee. He welcomed the principles in the document, which would help mobilize money for developmental purposes and help fine-tune governance.
Among the major obstacles for Ukraine were the problems associated with structural economic reforms and the consequences of the Chernobyl disaster, he said. An important role would be played by a non-discriminatory trade system. He hoped that the Monterrey Conference would build on the success of Doha, which had decided to have a new development round of trade negotiations. The future of mankind required that the international community act in a vigorous way and pool its efforts to strengthen the global alliance.
SHAUKAT AZIZ, Minister for Finance of Pakistan, said the existence of widespread poverty in the midst of global prosperity was undeniably the most serious challenge confronting the world today. The challenge was to fight human deprivation by taking a broad-based view of poverty. Official development assistance remained an essential supplement to domestic resource mobilization for low-income countries. The present level was lower than what was required to fight poverty and human deprivation. Furthermore, not only had ODA levels declined over the years, the transaction costs of aid delivery had risen inexorably, thereby eroding the effectiveness of aid. There was a clear need to increase the quantum, quality, and effectiveness of aid for defeating poverty and achieving sustained economic growth and development.
At the same time, he said, the effectiveness of aid should be measured by outcomes and not necessarily by the quantum of aid. Official development assistance was not the only funding source; equal importance should be given to creating an enabling environment to promote private capital flows. Aid should not be used as a permanent crutch, but as a means to allow the recipient countries to stand on their own feet. Raising the effectiveness of aid by creating a sound environment, an appropriate framework for investment, initiating structural reforms, ensuring good governance and transparency, eliminating corruption, and involving civil society was the prime responsibility of developing countries. They should learn to walk on their own. They just needed help getting there.
Debt relief was an integral part of a comprehensive concept of poverty reduction, he said. Countries that were striving to reform their economies but were loaded with huge debt overhang needed substantial debt relief to finance credible and "homegrown reform programmes". Meaningful debt relief would go a long way towards helping countries that were trying to help themselves.
Trade was an important source of growth, employment and poverty reduction, he said. It was also the single most important external source of development financing. Developing countries needed a level-playing field, aimed at encouraging market-based competition that helped producers and consumers alike. Fighting corruption on a global level was also high on the global agenda. But the war against corruption should be globally coordinated, and "bad money" should not find a safe haven anywhere. More concrete global action was needed to curb money laundering, flight of capital, tax evasion and illegal payments by bidders on government contracts. Hopefully, the shared vision of a better future would get further impetus at the Monterrey Conference.
KERMECHEND RAGHOEBARSING, Minister for Planning and Development Cooperation of Suriname, associated himself with the statement made on behalf of the Group of 77 and China. He said that the human rights-based approach to development was the key to development. A life of poverty was a serious human rights violation. The Monterrey consensus was a good point of departure, as long as it was translated into honest commitments and actions. Indeed, it had been proved that well targeted investments in the poor yielded among the highest returns in terms of social and economic development. That investment would create rewarding wins for all. Unfortunately, valuable time and money had been lost in an array of donor driven, inefficient and uncoordinated change in procedure and conditionalities.
He said that the good intentions and commitments of people in some parts of the world for the well-being of their fellow human beings in other parts of the world too often ended up in "bureaucratic quicksand" and ill-targeted delivery mechanisms of donor agencies. To reach the Millennium Development Goals meant more and faster interventions, less bureaucracy, and improved targeting and delivery. It must be ensured that money really ended up addressing the immediate problems of the poor and that the Goals were worked on, day by day, penny by penny. The concept of ownership, which led to more sound and sustainable results, should include both business and civil society representatives. Donor support must complement domestic processes, and not the other way around.
Also, the performance of donors and the international financial institutions must be measured and monitored, he said. The United Nations should have a strong mandate to do so. People should always be at the centre of all development goals -- the poor were reliable partners. Recent developments had suggested a renewed increase in defence expenditures. It must be ensured that the Millennium Development Goals were not jeopardized by that trend. Monterrey would present a price tag that would, hopefully, be sufficient to realize all the good intentions. At the same time, Monterrey was not only about money, but also about the future, and it provided a unique opportunity to effectively address some of the serious problems facing the world today.
JOSEPH HENRY MENSAH, Senior Minister for Government and Business of Ghana, said that addressing the conditions for financing development in a comprehensive manner held the key to building a world that everyone could be proud of. To justify all the expense and trouble of organizing the Conference, the international community should fashion powerful new instruments and relationships for mobilizing the massive volumes of financing that would be required just to address the deficiencies in the economic and social infrastructure of Africa alone. Unless the hundreds of millions of people subsisting in needless poverty in Africa were brought within the mainstream of the global economy, as other nations raced ahead under the stimulus of modern technology, the whole world would be the loser.
His country was well acquainted with the suffocating effects of unsustainable debt and the trauma of seeking debt relief, he said. Some of the modalities and principles of financing that went into the reconstruction of Europe after 1945 must surely go into the programmes of partnership that were negotiated after Monterrey, to bring Africa and other developing regions into the mainstream of the global economy. In the absence of some such bold initiatives, it was difficult to envisage how the lofty goals of the Millennium Declaration could be attained.
BOSSE RINGHOLM, Minister for Finance of Sweden, said the gathering was an opportunity to make efforts to reduce poverty, raise living standards, and improve economic conditions. The key to reducing poverty was sound economic policies. Many parts of the world participated too little in international trade. Globalization must be more equitable and inclusive. Trade-distorting subsidies should be abolished, as should tariffs on developing countries exports. The European Union's agricultural policy should be reformed.
He said rich countries should increase their rate of ODA, urging all donors to set time tables to achieve the target of 0.7 per cent well in ahead of 2015. A medium target would be to reach 0.33 per cent by 2006. Sweden had, for a long time, been a member of the far too-exclusive 0.7 per cent club. It had, nevertheless, set for itself a target of 0.1 per cent.
Developing countries must be aided to reap the benefits of globalization, he said. Their voices must be heard at the negotiating table. Sweden was prepared to help them in several areas of capacity-building, including in trade-related support and public-finance management. He noted that Sweden and the World Bank had this morning signed an agreement for capacity-building support for public expenditure management for Africans who participated in the HIPC debt initiative. Capacity-building support in debt management was also very important.
A global public goods task force should be set up to provide recommendations on the environment and disease, among others. Sweden was willing to lead the way to set up such a force as part of the outcome of the Conference.
CARLOS JULIO EMANUEL, Minister for Economy and Finance of Ecuador, said the founders of the United Nations had understood that international peace and security depended, to a large extent, on poverty reduction, economic growth and conditions leading to an improved quality of life. Despite those aims, there was a growing gulf between developing and developed countries. Multilateral financial agencies and others had failed to bridge those differences and had even intensified some crises by ignoring the social costs. Only a serious international effort could help advance an equitable world economic system. Failing that, agreed commitments would be no more than rhetorical utterances, and that would not help relieve the situation of millions around the world.
The level of external debt in many countries had reached unsustainable levels and slowed development. Efforts to find a lasting solution to that problem had been unsuccessful. They had been driven and controlled by creditors in accordance with their interests and had not tackled the underlying problems. The economic history of the last century had shown that political will led to solutions. Current problems of financing and indebtedness should inspire that same imagination that gave birth to the Marshall Plan, proposed by the victor countries of the Second World War. That had proved to be an effective instrument in the recovery and development of post-war Europe. The same creativity was required in the war against poverty. Indeed, the economic and social devastation present in developing countries today was much greater than the destruction inflicted on Europe in the Second World War.
Notwithstanding the efforts of developing countries to reform their economies, it was still impossible to make good use of the broader and more competitive global market, he said. That market was protected and distorted through tariffs and non-tariff barriers and subsidies, indeed, what the Secretary General of the United Nations Conference on Trade and Development (UNCTAD) had described as "negative financing for development".
He offered a three-tiered proposal: creation of an international compensatory fund to improve debt servicing of middle-income countries with debt- servicing problems; fairer international trade for developing countries; and fulfilling the promise of 0.7 per cent gross national product (GNP) for ODA. So far, developed countries had broken that promise; that was unethical and an urgent rectification was required. The IMF, World Bank and others should monitor implementation of such pledges.
EL HADJ OUMAR KOUYATE, Minister of State for Planning of Guinea, said his country was an exporter of raw materials, in particular, minerals. The prices of those products were determined by developed countries. The WTO should embark on a new cycle of liberalized trade, he suggested. Counter-productive regulations should be reviewed, export subsidies should be eliminated, and protectionist measures should be reduced.
The lack of internal resources in developing countries meant FDI and ODA were indispensable tools for poverty alleviation, he said. However, shortfalls in resources and the drag caused by debt-servicing continued to impede growth. He called for an integrated policy for international cooperation based on national priorities, which would help with, among other things, the transfer of technical capacities.
Developing countries still faced important tariff and non-tariff barriers for their export products, he noted. Any progress made in that area would enormously improve economic growth and would help reduce dependence on ODA. Infrastructure projects would become more viable. He welcomed the proposal made by the United States to the World Bank to give 50 per cent of its aid in the form of grants. Greater reliance on gifts would help bolster the long-term viability of developing countries. He noted the importance of the HIPC debt initiative in helping to relieve the burden of debt. He hoped the implementation of the Monterrey consensus would reinvigorate international cooperation.
M. SAIFUR RAHMAN, Minister for Finance and Planning of Bangladesh, said that the gap between rich and poor must be closed. While the international community must provide an appropriate environment, development must remain a core national responsibility. The process must be domestically engineered, owned and driven.
In that regard, Bangladesh had a good story to tell. Development was only possible against the backdrop of democracy, human rights and the rule of law. Good governance, social responsibility and fiscal accountability were the pillars of development. Also, corruption must be eliminated at all levels. His country had made great strides, such as using micro-credit to effectively pursue economic and social change. It had also addressed with success the problem of poverty alleviation. In addition, it had empowered its women by expanding their access to education and credit.
He was asking for trade and fair access for exports, an international support structure and coherence among international agencies. He also asked for investment that entailed a genuine transfer of knowledge and resources. He hoped that the message from Monterrey would galvanize the international community to higher levels of cooperation.
MOHAMED OULD NANY, Minister for Economic Affairs and Development of Mauritania, said the Conference was a unique opportunity to measure progress towards achieving the Millennium Development Goals. That would require unprecedented international solidarity. The success of the Conference depended on the ability to find appropriate solutions in the areas of ODA, foreign debt, international trade, and reduction of the widening technological gap between the industrialized and developing countries. Official development assistance must be greatly increased in the next few years to guarantee developing countries the resources compatible with halving poverty by 2015.
He said that public aid to developing countries had actually declined by
22 per cent in real terms between 1991 and 2000, and that had mainly affected sub-Saharan Africa. Reversing that trend was essential. Indeed, a dynamic compromise must be found to help the poorest countries. The debt burden was a major obstacle to sustainable development and poverty reduction. The HIPC initiative was a major advance towards solving that problem, but that must be consolidated. Also, the foreign debt of the poorest countries must be watched carefully to prevent a backslide from efforts already made to improve living conditions there. Trade could be a potent factor for development as long as access was improved and tariff barriers and subsidies that impeded exports were eliminated. The Doha discussion could be a chance to improve the trade situation.
Concerning the digital divide, the international community must help improve the access of developing countries to encourage a better spread of knowledge and promote conditions to increase information flows. The NEPAD initiative would enable African countries to implement programmes and improve living conditions. Mauritania had worked since the mid-1980s to implement an ambitious developmental strategy based on bolstering the role of the private sector and complying with rules of good governance, among other things. The reforms of the last 15 years had helped restore an economic balance and spur economic growth. Those had also reduced poverty.
PER SRIG MOLLER, Minister for Foreign Affairs of Denmark, said that, to meet the challenge of poverty eradication, the world should know the nature of its poor people. They were the small farmers, the landless labourers, the urban slum dwellers, women head of households, and people displaced by conflict or natural disasters. Three out of four poor people worked and lived in rural areas. To break the vicious cycle of poverty required focusing much more carefully on rural development, on jobs, small-scale industry and a conducive business climate. At the same time, access to health and education was vitally important.
He said that women, particularly in rural areas, were potential agents for change. The tasks and responsibilities of many women in developing countries were enormous -- from food production to masters of health and education and child rearing. The Monterrey consensus underlined the importance of mainstreaming the gender perspective into development policies, in order to strengthen the global economic system. Women had not been supported properly in the development process. Still, custom and civil law had not allowed them to own or inherit land. They did not have access to finance and, in rural areas, poor women had even fewer assets and rights.
Governments must make clear commitments to their poor citizens, he said. They must provide the necessary supportive policy, institutional and legal framework. And, they must guarantee the rights of the individual. Accountable institutions and good governance were necessary to facilitate the efforts of promoting the potential of poor people. Also, the link and the dialogue between the individual and the public sector should be strengthened. Hampering economic and social development led to insecurity. The international community and its institutions must expand a true global partnership to pave the way for a global deal in Johannesburg. It must continue to improve market access, reduce subsidies and pave the way for a more liberal and fair trading system.
JOHN DALLI, Minister for Finance of Malta, said Malta firmly believed that, with the necessary political will and commitment, the Millennium Development Goals could succeed in containing the scourge of poverty by 2015. The Conference should strive to achieve a comprehensive agreement on the financial mechanisms necessary to achieve those goals. However, financial mechanisms alone were not sufficient to achieve the needed changes in culture, the upgrading of human resource, the strengthening of economic fundamentals, the capillary expansion of distribution and the infrastructural build-up.
Only functioning governments, broadly committed to sustainable development, could significantly accelerate poverty eradication, he said. The achievement of adequate levels of financing for development required concrete actions at the national level to maximize the mobilization of domestic financial resources. He pointed out that some countries had specific constraints and vulnerabilities. Those included least developed countries, landlocked countries, and small island developing States.
"Trade is an engine which activates growth in developing countries", he said. Developing countries must enhance their capacities in view of future WTO negotiations to promote a level-playing field in the international trading system. They should be assisted to do so. In a rapidly emerging globalized world, national crises might have ripple effects impacting whole regions. That contagious influence called for adequate mechanisms aimed at enhancing existing opportunities and ensuring an equitable distribution of the benefits emanating from a globalized economy.
JOSEPH DEISS, Minister for Foreign Affairs of Switzerland, said that Monterrey was the first opportunity to officially announce to the international community his country's decision to join the United Nations. The Conference was critical in that it, for the first time, set out to tackle the problems associated with financing for development in a multidimensional fashion, going beyond just focusing on ODA. Member States must follow up on the consensus with action.
Switzerland had resolved to improve the effectiveness and impact of development efforts. He welcomed the recent announcements of the United States and the European Union. Switzerland wished to gradually increase its ODA to reach 0.4 per cent of GNP by 2010. It also wanted to make ODA more effective and efficient by supporting the strategies of partners and securing coordination with other donors. Another source of financing was trade. His country would continue to ensure equitable implementation of international trade agreements.
RAYMOND LIM, Minister of State for Foreign Affairs and Trade and Industry of Singapore, said stability, investment and trade were the main long-term drivers of global prosperity. For the Monterrey consensus to be a success, concrete actions on the part of all were needed. The international community must put together its collective will and wisdom to seek genuine market access for the goods and services of all. Expanding trade could lift at least 300 million out of poverty by 2015, in addition to 600 million escaping desperate poverty with normal growth. Even diminishing by 50 per cent protectionist tariffs in agriculture and in industrial goods and services would boost the world's yearly income by nearly $400 billion. And since three quarters of the world's poor lived in rural areas, opening up agricultural markets offered the best and quickest route out of poverty. Subsidies to agriculture, which ran at $1 billion a day -- six times development assistance -- were in urgent need of reform.
He noted that the Association of South-East Asian Nations (ASEAN) had generally sustained an open orientation towards trade and investment. It had brought forward the date from 2003 to 2002, by which it would achieve 0 to 5 per cent tariffs under the ASEAN Free Trade Area. Besides trade, flows of FDI could assist development. He also placed great emphasis on the importance of capacity- building and gave an overview of Singapore's initiatives in that area.
While much of the responsibility for change and adaptation lay at the national level, problems must be addressed in the global context, he said. One thing that was needed to ensure that was for the United Nations and international organizations, such as the World Bank and the IMF, to renew themselves so as to adapt and better respond to the new environment and challenges presented.
LIZ O'DONNELL, Minister for Development Cooperation of Ireland, appreciated the recent agreement of the European Union to increase ODA by $7 billion per year by 2006. In Monterrey, world leaders were acknowledging that mutual interdependence required mutual effort to address poverty and injustice. Increasingly, aid was being seen as an instrument of global security, but it would be a shame if that notion were to replace humanitarianism as the key to development assistance. The developing countries were supported because it was moral and ethical to do so as members of the human family. The instinct to help a fellow human being in need was what made the world civilized. It would diminish the legacy of thousand of humanitarians to allow that motivation to be downgraded.
She said that donors must end the proliferation of donor-driven aid projects and align their activities in support of country-owned development projects. Development assistance should be completely untied. To fulfil their part in the new development partnership, developing countries needed to make good governance, the rule of law, and market-oriented policies a reality. It was time for the donor community to take concrete steps to implement the long-standing United Nations commitment of ODA at 0.7 per cent of GNP. The right to development was no longer "postponeable". A series of timebound development goals and financial commitments must be evolved. Ireland had made a commitment at the United Nations Millennium Summit to reach the agreed target by 2007. That commitment was now reflected in the national budgetary process.
Health and education were key priorities in Ireland's work with developing countries, to which national non-governmental organizations and missionaries had made huge contributions, she said. Her Government's partnerships with them would deepen as efforts increased to meet the United Nations' target. With respect to global trade negotiations, she was committed to the effective implementation of the Doha Development Agenda. While she recognized the achievements of the HIPC initiative, she remained unconvinced about the relief, particularly in countries with HIV/AIDS and other burdens. The long-term debt relief objectives should take into account human development indicators. Ireland's own development experience demonstrated that globalization, powered by trade and investment, could transform an economy and dramatically lift the living standards.
ABDULLAH BIN KHALID AL-ATTIAYH, Governor of the Central Bank of Qatar, said that everyone had a role to play in supporting the international effort to ensure that the global systems of finance and trade fully supported economic growth and social justice for all. Qatar had committed itself from the very beginning to be a major partner among donor countries. It was an active member in many economic, social, cooperative, developmental and agricultural organizations. Moreover, the country had established a development fund to provide assistance to the needy countries, and its development assistance relative to GDP was one of the highest in the world.
He called on the developing countries to adopt economic policies that enabled them to develop their economies and reduce poverty. In that regard, developed countries should offer full support to developing countries to diversify their production and export base. He called on the international community to avoid adopting policies that negatively affected certain groups of countries or that targeted specific commodities. Further, attention should be given to strengthening and ensuring the meaningful and full participation of developing countries in the regional and international financial and development institutions.
JULIAN HUNTE, Minister for External Affairs of Saint Lucia, called for a comprehensive and dispassionate assessment of the global economic system. The requisite policies and strategies must be established to allow the peoples of the world to live prosperous lives. While he supported the principle that all countries should take responsibility for their development, development could not be achieved in a system where the market was both the alpha and omega. Conditions related to small size were not treatable by market-based prescriptions, for example.
The greatest challenge to the Caribbean Community (CARICOM) single-market initiative came mainly from without -- globalization in its present form was neither inclusive nor equitable, he said. The liberalization process had reduced the system of preferential market access on which small States had relied. A holistic approach to development was, therefore, to be supported. Concrete actions must be taken to help small island States.
The growing interdependence of national economies made it imperative that collective and coherent action was taken, he said. He recommended establishing a permanent inter-agency coordinating committee under the auspices of the United Nations. He reiterated his deep concern about efforts being made to usurp the sovereign rights of States to set up their own tax policies. Saint Lucia would take an active role in the follow-up to the Conference.
DELIA GRYBAUSKAITE, Minister for Finance of Lithuania, said that this year her country had started implementing its own development policy and was gradually transforming from a recipient to a donor country. Foreign assistance to the country had been essential to that transformation. Nonetheless, mobilization of local resources, commitment to good governance and ownership -- guarantees of the ability to absorb the assistance for the implementation of reforms -- represented significant achievements for Lithuania. Human rights, the rule of law and democratic principles had served as the basis for the country's sustainable growth.
She said that the liberalization of the economy, the promotion of free trade, the creation of favourable conditions for foreign investment and strict anti-corruption measures had established Lithuania's reliability. With the prospect of membership in the European Union, the North Atlantic Treaty Organization (NATO), and the Organization for Economic Cooperation and Development (OECD), Lithuania must now prepare for additional international obligations.
This year, she said the country's development cooperation policy had been identified as an integral part of its foreign policy, which aimed to promote global security, human rights and democracy, sustainable development and poverty reduction in the world. In the process of reform, Lithuania had learned a lot about the modalities of development cooperation and had forged new partnerships. Her country strongly supported the Millennium Development Goals and was firmly committed to the aims of the Monterrey Conference.
MPHO 'MELI MALIE, Minister for Industry, Trade and Marketing of Lesotho, said that moving away from dictatorship and authoritarianism was incomplete unless it was replicated in socio-economic development, trade and other decision-making processes at the global level. At both subregional and regional levels, governments were pulling together to create a political environment unfriendly to political dictatorship, military coups and other undemocratic systems of governance. Many governments were enacting anti-corruption legislation and establishing institutional and administrative structures to combat drug trafficking, terrorism, and small arms proliferation, with the ultimate aim of promoting democracy, good governance and human rights.
He said that more and more developed countries and international organizations had demanded that developing countries should put their houses in order. While that was understandable, achievements should be duly rewarded by more meaningful financing for development by cooperating partners. The fulfilment of internationally agreed ODA targets by all developed countries would generate increased resources for development financing. He urged all developed countries to meet those targets, since ODA remained the largest source of external financing for landlocked, resource poor least developed countries like Lesotho.
External debt relief could also be targeted to less indebted poor countries like his own, as that would release significant resources to invest in poverty- alleviation programmes, human resource development, economic and social infrastructure, he said. Cancellation of Lesotho's debt, coupled with the availability of ODA and other development assistance, would give his country the capacity to invest in economic development programmes and help it integrate it into the global economy. Trade liberalization also played a vital role in promoting economic growth, leading to the creation of a universal, rules-based, open, non-discriminatory and equitable multilateral trading system under the auspices of the WTO.
HEIDEMARIE WIECZOREK-ZEUL, Federal Minister for Economic Cooperation and Development of Germany, said the debate must focus on how to shape globalization to serve the people, especially the poor, and thus secure peace and stability. The challenges of eradicating poverty, shaping globalization, and security demanded a true partnership with shared responsibility and better participation of women. Partnership required better representation of developing countries in international economic and political decision-making processes and fairer trade rules. All self-privileging elements contained in the world trade system must be dismantled. Asking developing countries to further liberalize their economies was only legitimate if the industrial countries themselves refrained from applying double standards to the disadvantage of developing countries.
She supported moving forward with the Doha agenda, which provided for a substantial reduction in trade distortions and the phasing out of all forms of export subsidies for agricultural products. That should be achieved as speedily as possible. Subsidizing agricultural products at the current levels ran counter to development goals and lacked justification. Economic globalization had outpaced political globalization. The establishment of a high-level global council was a worthwhile proposal to overcome the current inadequate representation of developing countries in international forums.
Given the enormous demand for financial resources to meet development needs, an open and transparent discussion on innovative sources of financing and global public goods was necessary, she said. The German Development Ministry had presented a feasibility study on a tax on foreign exchange transactions. The study showed how such a tax could work in practice. Developing countries would benefit through reduced volatility of financial flows and more stable financial markets. Speculative transactions could be fought off. In addition, the tax would generate significant resources to be used for development purposes.
FRANÇOIS-XAVIER NGOUBEYOU, Foreign Minister of Cameroon, said he supported the statement made on behalf of the Group of 77. African leaders had sized up the challenges facing their continent and designed and adopted a new partnership, NEPAD. That was a strategy and action plan to speed economic growth, reduce poverty, and promote Africa's integration into the world economy. His country expected that the Conference would define the ways and means of mobilizing the resources needed to implement the Millennium Development Goals.
He said there were differing assessments about whether that expectation had been met. On the positive side were the Monterrey consensus and the decisions announced by the European Union, United States and Canada to increase ODA, as well as the agendas of the international economic and financial organizations, particularly the World Bank, IMF and the WTO. He supported the Monterrey consensus, but he expected specific measures, which would allow Africa to implement NEPAD. Those included debt cancellation, increasing ODA to reach agreed targets, market access and development of trade capacities, and the elimination of agricultural subsidies.
MARIS RIEKSTIN, Secretary of State of the Ministry of Foreign Affairs of Latvia, said that international development assistance made an important contribution to peace and security. It had become even more important in view of the terrorist attacks of 11 September, which had resulted in an economic slowdown in many countries.
He said his country had regained its independence only 11 years ago. Since then, it had taken steps to complete the transition to a market economy. That positive development was based on the readiness of developed countries to provide international assistance. Latvia now stood ready to provide assistance to those countries that needed it most.
Latvia had provided bilateral aid to countries in the Balkan region and, more recently, assistance to ease the pain of civilians in Afghanistan, he said. The country had become a contributor to the UNDP and was interested in participating the programmes of the UNDP, the World Bank and the IMF. International trade should act as an important engine for development. During the development trade round at Doha, Latvia had declared its support for the integration of developing countries into the international trade system.
ANDREAS LOVERDOS, Deputy Minister for Foreign Affairs of Greece, associated himself with the statement made by the presidency of the European Union this morning. He affirmed his country's willingness to increase its ODA from 0.2 per cent to 0.33 per cent. In the next four years, it would spare no efforts to make substantial progress so that, collectively, the European Union reached an average of 0.39 per cent by the year 2006. A few years ago, he noted, Greece was considered a developing country; today, it was a member of the euro-zone and a donor country. Its ODA had risen 300 per cent since 1997, and its growth rate of 4 per cent was one of the highest in Europe.
Development efforts should be based on participation, solidarity, equity, co-responsibility, foresight, ownership and partnership, he said. Of those, partnership was the key principle. It was the most effective and efficient working scheme and promoted coordination, coherence and complementarity of actions. It was also known to assist the promotion of good governance and was a prerequisite for building trustworthy relations between all stakeholders, by cultivating mutual understanding and enhancing transparency.
In an era of globalization, a fractured world of insiders and outsiders was not a safe and prosperous world, he said. The challenge ahead was to turn grievances into opportunities, and opportunities into realities.
FRANZ MORAK, State Secretary of Austria, welcomed the European Union's commitment to reach an average of 0.39 per cent of GNP by 2006 as a concrete step forward to achieving the internationally recognized goal of 0.7 per cent. Austria was committed to that goal, but improvement of the economic and social situations in developing countries did not solely depend on external financial inflows. Those nations must be able to create and extend their basic economic and social structures. That was a precondition to targeting ODA efficiently. He put high priority, therefore, on capacity-building, including democracy-building, and access to education and basic health services, among others.
He said that governments had to create the conditions for economic growth through investment in social justice and by offering the entire population education, health and other social services. Good governance was up to the State, in collaboration with the private sector and civil society. All three domains were critical to sustaining human development. Much had been said after the Doha meeting about the role of trade and the need for better market access, but even before trade, goods had to be produced. In that area, particular efforts were required.
MAKARIM WIBISONO, Deputy Minister for Foreign Affairs for Foreign Economic Relations of Indonesia, said his country's economy had bounded ahead in an unprecedented way until the Asian financial crisis of 1997 struck with crippling speed and impact. Poverty and unemployment soared; children left schools in droves; and the national debt reached new and staggering heights. Indonesia faced the formidable task of addressing multiple crises in economic, social and political fields simultaneously. The task it faced now was even more difficult. A major challenge at Monterrey was to define and deal with development finance challenges in the context of historic, systemic transitions. He urged the Conference to recognize that severe economic shocks were fundamentally different from the more mainstream obstacles of long-term development.
Effectively addressing those combined difficulties required the right mix of policies to move an economy forward without sparking unrest, he said. One of the first steps had been to embark on a transition towards a more democratic government which, though still fragile, had undergone a number of peaceful transitions. Central to Indonesia's recovery programme was poverty eradication. It was committed to achieving the Millennium Development Goals and had sought to expand beyond economic policies to embrace the social and sustainable dimensions of development. Special attention was being paid to the care of children, promotion of gender sensitivity, and full inclusion of the rural sector and all disadvantaged communities into the national economy.
While each country was largely responsible for its own development, national economies were increasingly interwoven in a broad web of international economic activities. A supportive international framework must complement domestic efforts. In that regard, private financial flows were important, and ODA was indispensable, especially for those countries unable to attract adequate private flows for social and sustainable development purposes. Another key was international trade -- unilateral actions by developed countries to improve access for products and provide technical and financial assistance for capacity-building were urgently needed. Also, the magnitude of the debt problem was staggering, and Indonesia needed some "breathing space".
Meanwhile, he said, international investors would likely continue to perceive a relatively high level of risk in Indonesia. He, therefore, welcomed consideration by all stakeholders of an international debt workout mechanism that would engage debtors and creditors together in a process of restructuring unsustainable debts in a timely and efficient manner. The international community should also seriously consider the creation of a specific debt-relief mechanism to support developing countries in achieving sustainable development. That could include "debt swaps for nature, debt swaps for equity and debt swaps for development", which his country wholeheartedly supported.
JELICA MINIC, Assistant Minister for Foreign Affairs of the Federal Republic of Yugoslavia, said the Monterrey consensus was extremely important, as it would contribute to mobilizing funds for development and reaching a firm consensus of all participants on a large number of issues. Financing for development must be carried out primarily from domestic resources; although foreign financial support should not replace efforts to ensure domestic resources, it had to be a catalyst in the development of developing countries and countries with economies in transition. Without foreign capital inflow, it was not possible to carry out the necessary economic and political reforms.
After more than a decade of serious regional instability, wars, economic sanctions, mismanagement and corruption, which had drastically crippled its economy, her country had embarked on radical economic and political reforms which would surely contribute to economic and political stability of the region and Europe at large. The Federal Republic of Yugoslavia needed assistance. However, it stood ready to implement all necessary measures at the domestic level to replace that assistance as soon as possible with trade and direct foreign investment.
She said she fully supported the reform of the international financial architecture, which should contribute to sustainable development in a more concrete way. She joined in the efforts aimed at finding a pragmatic and innovative way to promote further efficient participation of developing countries and countries with economies in transition in international dialogue and decision- making -- that was the only way to ensure that globalization benefited all. She emphasized the importance of a follow-up conference and the need to use financial resources as efficiently as possible to achieve the Millennium Development Goals.
Archbishop RENATO R. MARTINO, Observer for the Holy See, said that development was, foremost, a question of people. Human beings were the centre of concern for sustainable development. Historically, financing had had its place in the development discussion, but, in some cases, the task was too great for one community or nation to accomplish on its own. The underlying challenge was the adoption of an attitude of solidarity between and among all people. Financing for development was a mix of good intentions, resources and varied approaches with the potential to contribute to the development and well-being of each individual.
He said that the Holy See continued to involve itself in the ongoing process of the development of peoples. It strongly believed that any effort in favour of development must analyse the moral ramifications of economic activity and its financing, in light of a comprehensive vision of the human person. That was an absolutely essential interplay, a moral imperative, which had often been neglected in the dialogue over the ethics of economic life. True concern for the development of peoples must respect the genuine claims of both economics and morality. Human dignity must be the central value of financing for development.
The world today was overshadowed by a fragile peace and marked by broken promises, he said. Too many people lived lives without hope and with little opportunity for a better future. Governments could not afford to allow the Monterrey consensus, nor the results of the week's deliberations, to be set aside. Rather, the consensus must be a renewal of the commitments already made. Not one more day should be allowed to pass without a resolute and energetic attempt to meet the goals and make measurable progress towards eradicating poverty.
MADINA JARBUSSYNOVA (Kazakhstan) said the globalization and regionalization of the world involved a great deal of integration. In that context, appropriate monetary and fiscal policies must be adopted to create a more favourable external environment for developing countries. She noted that her Government had adopted a State programme on fighting poverty and unemployment, with a focus on health and education. The national economy was now on the rise, with a level of employment at 90.2 per cent. However, not all problems had been solved. Some of the challenges to be faced included the cycle of world and regional financial crises, instability along the national borders, terrorism and the drug trade.
Effective domestic policies must be put in place, and good governance and sound economic policy must be promoted, she said. However, many of the most vulnerable countries still depended on external funds. Trade was the most important mechanism to mobilize and expand their domestic and external sources of financing for development. Despite progress, direct and indirect tariff barriers continued to affect exports. Multilateral efforts to establish dialogue to discuss that issue should be undertaken. There must also be improved coordination between multilateral institutions, such as the United Nations and the WTO. She hoped that all countries would join hands together for cooperation.
WARNASENA RASAPUTRAM (Sri Lanka) said the Monterrey consensus set the guidelines, but not the targets, to be achieved in financing development and eradicating poverty. Those guidelines had been set before, but little had been achieved. The hour had come. Today, there was an opportunity to move forward and act with firm commitment on the basis of the shared responsibility to halve poverty by 2015. What was needed now was to strengthen the "arm of development paradigm" by a time-bound action plan for poverty eradication. That should be done immediately to take advantage of the current atmosphere surrounding global security. The problem of poverty had come to centre stage following the terrorist attacks on 11 September.
World security, future development and growth depended on defeating poverty by the same coalition of forces that had joined together to fight terrorism, he said. Although poverty was not the only cause of terrorism, an action plan presented by the United Nations Secretary-General at the Millennium Summit should be adopted that took a holistic approach to prepare the environment for peace and harmony by removing corruption and inculcating the human values of respect for human rights, tolerance and justice for all. Tangible results obtained through education, health and nutrition programmes would generate the necessary alliance with the business, government, and non-governmental organizations. The action plan should be implemented on an urgent basis so that poverty could be eradicated by 2015.
He said he was not overly optimistic about foreign assistance because that could be temporary. The removal of trade barriers, however, could generate nearly $300 billion for the developing world. Foreign direct investment was also crucial and, as everyone knew, money flowed when confidence was high. Confidence-building measures, therefore, must be put in place to remove the legacy of distrust about the utilization of funds. Economic reforms and policy initiatives to raise local savings to the highest possible level, sound macroeconomic management and good governance would prepare the ground for greater financial assistance. In light of the speculative capital movements that resulted in the Asian financial crisis, the IMF should develop create an alliance among all stakeholders, aimed at evolving a strategic partnership with the capital providers and the securities commissions of the countries.
MOHAMMAD ABULHASSAN (Kuwait) said that, soon after independence, his country had established the Kuwait Fund for Arab Economic Development to help developing countries, in general, and sister Arab States, in particular. The Fund had been in existence for more than four decades during which it had offered 616 loans to 97 countries. The value of those loans, as well as technical assistance, was in excess of $11 billion. That placed Kuwait in the forefront of development aid donors, since its total development assistance contribution represented 8.2 per cent of its GNP.
He called for efforts to change the international financial system to make it more democratic and transparent through a more meaningful dialogue between the South and the North. Kuwait further appealed to the developed countries to increase their ODA and to honour their commitments to allocate 0.7 per cent of their GNP, bearing in mind the harsh conditions facing the heavily indebted poor countries.
There was a pressing need to write off all bilateral loans owed by developing countries in return for an explicit commitment to eliminate poverty, he said. Kuwait had taken the lead in that regard by writing off all loans more than eight years ago.
NOUHAD MAHMOUD (Lebanon) said that, in order for development to succeed, it must have a health and normal environment wherein peace, security and a commitment to international law were the norm. Growth was not possible in conflict-ridden environments. Neither were deviations in international law and States' relations, and marginalization of democratic values conducive to development. The Monterrey consensus stated that private flows was one of the most important means to development. He would take that one step further by emphasizing the idea that multinational corporations should participate in financing development. With their vast amounts of capital, it was only reasonable that they play their part.
He noted that the idea of financial contribution by transnational corporations was already partially and sporadically practised. The philanthropic acts by some within the transnational system reflected humanism and vision. He looked forward to the day when those acts of participation were mandatory, regulated and institutionalized in an international fund wherein financial assistance for development was not tied to political considerations from one side or the other. He proposed a freer system of financial contributions that did not rely on government aid in the public realm and FDI in the private one. Participation of multinational corporations in a global system of development financing was just, reasonable and feasible.
ALTAI EFENDIEV (Azerbaijan) said that utilizing its natural and geographical comparative advantages and sharing their benefits, his country was contributing to the development of regional cooperation through participation in a number of regional economic organizations. It was also actively involved in implementation of large regional infrastructure projects, such as the development of multiple pipeline routes for export of Caspian oil and gas to international markets, as well as a transport corridor linking two major global economic power centres -- Europe and Asia. Notwithstanding the optimistic prospects for development, resources were needed to tackle the pressing needs of the country and its development.
He drew attention to the conflict affecting Azerbaijan, which had resulted in foreign occupation of a fifth of the territory and over a million refugees and displaced persons scattered across the country. That had imposed an enormous burden on the economy and society, as well as had serious implications on the mobilization and distribution of resources for development. More aid was badly needed to tackle that issue. Conflict and its consequences had impeded cooperation and development at the regional level by hindering the efficient allocation of resources, and discouraging foreign investment. That was why conflicts and conflict-affected areas should be a focus of the international community and adequately reflected in the Monterrey consensus.
FREDRICK PITCHER (Nauru) said that his country, officially the world's smallest republic, attached the greatest importance to the Conference, primarily because of the difficulty of integrating the small economies into the world economic system. Structural fragilities and institutional incapacities continued to constrain the small island developing States, which could not assume a painless transition into the world economy.
Emphasizing the necessity for wealthy countries to live up to their commitments, he said the provision of foreign assistance had been critical to the development of such economies as those of Japan, the Republic of Korea, and Taiwan which today was one of the largest contributors of ODA. Donor countries should implement aid, not politicize it, he said.
Small economies like Nauru faced challenges that could not be overcome without structural change, he stressed. They were not asking for charity but help in order to help themselves. Some of them had been forced to look elsewhere, including the provision of offshore financial services, and had, as a result, been identified in the OECD tax haven list and sanctioned as a result. Welcoming the United States and European Union pledges to increase ODA, he said the momentum generated at Monterrey must be maintained. The Johannesburg World Summit on Sustainable Development would be the key test.
GUYLA NEMETH (Hungary) said the issues being discussed were of great importance to all States. The basic precondition for the eradication of poverty was sustainable growth of the economy. The enormous political and economic changes in the early 1990s would have been impossible without financial assistance. Now, the problem of indebtedness had ceased to exist, as had the country's equilibrium problems. In recent years, the economy had been on a growth path.
Hungary was committed to collaborating with all stakeholders to eradicate poverty and promote sustainable development, he said. It was ready to share its experience in laying the foundation for a sound economy with its partners. In the
past year, Hungary had decided to launch a national programme of development cooperation, focusing on bilateral ODA aimed at developing countries. It intended to increase its development activities.
He welcomed the efforts of the international community, including the international financial institutions, aimed at alleviating the situation of the developing countries, including through debt relief. Hungary stood ready to play its part in making sure the outcome of the Conference was implemented.