Mr. Geir H. Haarde
Minister of Finance in Iceland

at the International Conference on Financing for Development

Monterrey, Mexico
March 18th-22th 2002

Mr. Chairman.

We live in an interdependent global community. Globalization is now a fact for most nations, not an option.  It has has contributed to greater prosperity and increased growth. But it has also brought new challenges and raised new questions. How are we to ensure that all countries reap the full benefits from globalization? How can we ensure a more equitable global economic environment? These are some of the most pressing challenges facing the international community today. 

Global partnership for financing for development is a key element in this endeavor. I would like to commend Secretary-General Kofi Annan for bringing together the UN agencies and the Bretton Woods institutions as well as the private sector to address this important global issue. I also thank the Government of Mexico and President Fox in particular for the hospitality we have enjoyed during our stay.

Mr. Chairman.

Icelandís position as regards the main issues of this conference is very clear. We fully support the proposed text of the Monterrey Consensus. 

As stated in the draft text the internationally agreed development goals, including those contained in the Millennium Declaration, call for a new partnership between developed and less developed countries. This should inter alia include a firm commitment to sound, free-market economic policies, good governance in a proper constitutional environment, human rights and gender equality as well as transparancy through the rule of law. 

We must recognize that the global economic environment is a decisive factor in development. We know that unimpeded international trade is an engine for growth and development and that foreign direct investment is a means for transferring capital, technology and know-how. To take advantage of these opportunities, the developing countries and the economies in transition must be fully integrated into the global trading system and assisted in building a domestic environment that attracts investment and fosters prosperous economic activity.

The opportunities of globalization do not, so far, benefit all countries equally. For some of the marginalized least developed countries, Official Development Assistance is still the largest source of external financing and often critical for meeting their development goals. It is imperative that we focus specifically on harnessing the forces of globalization to the benefit of these countries.

How can this be brought about? There are no easy solutions. But many small things can add up to something bigger. That is why I believe a small country like my own can make a difference. We believe that the least developed countries should receive duty-free and quota-free access for their exports. Iceland has granted unilateral tariff concessions to the least developed countries, putting them on par with our partners in the European Economic Area. I encourage those developed countries that have not already done so to improve their market access for exports from the least developed countries. The benefits from such actions are obvious.

It is also imperative that debt servicing of the developing countries does not hinder their efforts to provide essential health and education services that form the basis for a healthy development of the economy. We are encouraged by the progress in implementing the enhanced HIPC initiative. It remains our hope that external debt relief will enable the poorest nations to use the funds that have been channeled into debt servicing to stimulate economic growth, combat poverty and strengthen their infrastructure. At the same time we should acknowledge that the fight against poverty can only be successful if the poor countries themselves lead the way while the Bretton Woods Institutions are there to support them.

Mr. Chairman.

The time has come for a unified effort by political leaders as well as civil society and the private sector, to reverse the trend of marginalisation and underdevelopment. We stand before an unprecedented opportunity to make a real difference in the lives of millions of people throughout the developing world. 

The Monterrey Consensus is probably one of the most important documents in the history of international development cooperation. It lays a foundation for partnership between the developed and the less developed countries in dealing with the challenge of poverty eradication and sustainable development. The document, furthermore, puts into focus the need to place development issues in the forefront of international politics much as economic policy is a major part of political life at the national level in most countries. 

I do hope that this conference will make a difference and will help create the necessary conditions for future financing for development.

Thank you Mr. Chairman.

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