ECONOMIC AND SOCIAL COUNCIL EXAMINES RESOURCE MOBILIZATION TO IMPLEMENT 2001 BRUSSELS ACTION PLAN AIMED AT WORLD’S POOREST COUNTRIES
ECONOMIC AND SOCIAL COUNCIL EXAMINES RESOURCE MOBILIZATION TO IMPLEMENT 2001 BRUSSELS ACTION PLAN AIMED AT WORLD’S POOREST COUNTRIES
Economic and Social Council
Preparatory Meeting for
ECONOMIC AND SOCIAL COUNCIL EXAMINES RESOURCE MOBILIZATION TO IMPLEMENT
2001 BRUSSELS ACTION PLAN AIMED AT WORLD’S POOREST COUNTRIES
Preparation for Council’s 28-30 June High-Level Segment;
Bangladesh, Timor-Leste, Benin, Burkina Faso Focus of Round Tables
In preparation for the high-level segment of its annual substantive session, the Economic and Social Council (ECOSOC) today convened the second in a series of meetings on resources mobilization in the context of the implementation of the 2001 Brussels Programme of Action for Least Developed Countries.
The Brussels Programme of Action, a set of key commitments for implementing the Millennium Development Goals, includes seven specific commitments made by the least developed countries (LDCs) and their development partners, including mobilization of financial resources, as well as governance, trade and sustainable development.
The Council held the first preparatory meeting on 17 February, at which it was noted that resources mobilization required a comprehensive approach to achieve sustainable development and to reduce poverty. Today’s round tables examined specific themes while focusing on individual countries -- Bangladesh, Timor-Leste, Benin and Burkina Faso -- with the participation of senior policymakers from government and their multilateral and bilateral development partners.
The meetings today and tomorrow, noted Council President Marjatta Rasi (Finland) in her opening remarks, should provide greater insight into the development experiences of least developed countries and help identify lessons and best practices in addressing the constraints and obstacles they faced.
Anwarul K. Chowdhury, Under-Secretary-General and High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States, said that this year’s substantive session of ECOSOC might well be called “The LDC’s Session” since three of four segments would focus on the challenges faced by the 50 LDCs and the implementation of the Brussels Programme.
Until now, he said, all financing for development to support LDCs had been based on official development assistance (ODA). With the new challenges being faced today, attention should be turned to increased foreign direct investment, debt cancellation, trade opportunities and new avenues besides the traditional sources of financing. For their part, LDCs should further explore “South-South” cooperation as an alternative, not as a substitute, way to fund development.
Assistant Secretary-General for Economic and Social Affairs Patrizio Civili pointed out that LDCs were confronted with numerous formidable challenges, ranging from extreme poverty to lack of domestic and external resources. Those challenges must be addressed first and foremost by LDCs themselves. National ownership was critical not only to a successful development strategy, but also to successful peace-building initiatives.
He added that those challenges could only be fully met if the partnerships forged at Brussels and in other international conferences were translated into concrete actions at the national and global levels. At the national level, effective governance and an enabling environment were crucial. At the global level, developed countries needed to pay greater attention to the coherence of their policies in terms of their development impact.
Opening remarks were also made by Rogatien Biaou, Minister of Foreign Affairs of Benin and Chairman of the Group of LDCs; Aicha Bassarewan, Vice Minister of Planning and Finance of Timor-Leste; Tertius Zongo, Ambassador of Burkina Faso to the United States; and Jeffrey Sachs, Special Adviser to the Secretary-General on the Millennium Development Goals.
Summing up the round table on resources mobilization for the implementation of the Brussels Programme of Action, focusing on the experience of Timor-Leste and Bangladesh, Ms. Bassarewan said that the two countries faced different challenges in terms of resources mobilization. Timor-Leste relied heavily on international development assistance, which had begun to decline recently. Bangladesh had decreased its reliance on ODA and had identified tax revenues as a primary source of financing for the next decade. While LDCs were heavily dependent on ODA, even significant increases in ODA to LDCs would not be sufficient to meet their resource needs. David Lockwood, Deputy Director, Asia and the Pacific Bureau, United Nations Development Programme (UNDP), co-chaired the discussion.
Reporting on the panel on the impact of good governance and public finance management on the mobilization of domestic resources, focusing on the experience of Benin, which was co-chaired by Mr. Civili, Foreign Minister Biaou said that an important element of the discussion was the recognition by donors and the LDCs of their respective obligations and the challenges facing them. The LDCs recognized the importance of good governance, while donors recognized the importance in adequately responding to the legitimate needs of LDCs. The mobilization of internal resources was seen as necessary, but far from sufficient for achieving the Millennium Development Goals. In addition to donor assistance, horizontal cooperation, especially the exchange of good practices, could be an effective tool to move forward good governance in the LDCs.
Presenting the highlights of round table on poverty reduction strategy papers (PRSPs) as a mechanism for resources mobilization, focusing on the experience of Burkina Faso, Ambassador Zongo said that the participants had recognized the central role played by the PRSP with respect to access to concessions and debt relief for many of the LDCs. Speakers had underscored the necessary cohesion that must prevail between the PRSP process and international development goals such as the Millennium Development Goals and the Brussels Programme of Action. Many felt that much remained to be done and better coordinated assistance was needed. The discussion was co-chaired by Jeffrey Katz, Manager, Partnerships and External Affairs Group for the Africa Region, World Bank.
The Council will meet again at 10 a.m. on Thursday, 18 March, to discuss LDCs emerging from conflict, as well as the pivotal role of trade and market access in poverty alleviation and resources mobilization.
MARJATTA RASI (Finland), President of the Economic and Social Council (ECOSOC), recalled that at the first preparatory meeting held on 17 February, it was noted that resources mobilization required a comprehensive approach to achieve sustainable development and to reduce poverty. For instance, economic growth should be combined with pro-poor policies, and strengthening institutions was essential to sustain development.
The Council, she said, supported those pro-poor policies through coordinating and establishing link among the various United Nations bodies, functional commissions and specialized agencies. Furthermore, the Council provided guidance to the United Nations system on how to ensure a coordinated follow-up to major United Nations conferences and summits. The role of the Council was important, and an effective and efficient implementation framework was key to attaining both the Brussels Plan of Action and the Millennium Development Goals.
The Council’s meetings today and tomorrow should provide greater insight into the development experiences of those countries and help identify lessons and best practices in addressing the constraints and obstacles facing least developed countries (LDCs), she said. She then outlined the scenario for the current meeting.
ANWARUL K. CHOWDHURY, Under-Secretary-General and High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States, said that the Brussels Programme of Action for the LDCs reflected a major international consensus to forge a stronger partnership to fight poverty and support sustainable development in those countries. That was based on seven specific commitments undertaken by those most vulnerable nations and their development partners. This year’s substantive session of ECOSOC might well be called “The LDC’s Session” since three of four segments would focus on the challenges faced by the 50 LDCs and the implementation of the Brussels Programme.
He said that the high-level segment theme on resource mobilization for LDCs was a very special opportunity for those countries to engage the international community in considering proactively the specific measures that could be taken for their development. That well-articulated theme basically covered the interdependence of all seven commitments of the Action Programme, as well as all cross-cutting issues contained therein. One of the round tables tomorrow would also address the challenges faced by LDCs affected by conflict. The events of today and tomorrow would cover a range of issues from resource mobilization for the implementation of the Brussels Programme to LDCs emerging from conflict and striving for market access.
The next special meeting of ECOSOC with the Bretton Woods institutions on 24 April in New York should focus on issues related to financing for development of the LDCs within the framework of the Brussels action plan, he said. That meeting should foster dialogue aimed at enhancing coordination between multilateral agencies for the effective delivery of development and poverty reduction support in favour of the LDCs. He recalled the Secretary-General’s recommendation to the Council last year asking those entities that had not yet done so to consider establishing a specific category for LDCs in their annual reporting and to mainstream the LDCs Programme in their activities.
Until now, he said, all financing for development to support those countries had been based on official development assistance (ODA). With the new challenges being faced today, attention should be turned to increased foreign direct investment, debt cancellation, trade opportunities and, at the same time, new avenues besides the traditional financing support for LDCs. For their part, those countries should further explore “South-South” cooperation as an alternative, not as a substitute, way to fund their development. “South-South” cooperation, including support through the triangular cooperation, could play a significant role in promoting sustained growth and sustainable development for the LDCs.
He said that the World Solidarity Fund set up by the United Nations last year was a good initiative to reiterate global solidarity by supporting the poorest countries. The Fund should become operational as soon as possible, and the LDCs should be its primary beneficiaries. In the financing for development implementation process, particular attention should be given to the resource commitments for the LDCs made at Monterrey.
He was confident that the present two-day debate would offer the opportunity to bring up the concerns and constraints of the LDCs and how to overcome them, thereby improving the living conditions of their people. It should be kept in mind that the conclusions reached from the preparatory process in February and March would provide the main inputs to the report of the Secretary-General to the high-level segment. It was imperative to be responsive to the priorities of the LDCs and to obtain a good and focused outcome with concrete actions in June.
PATRIZIO CIVILI, Assistant Secretary-General for Economic and Social Affairs, delivering the statement of Under-Secretary-General for Economic and Social Affairs José Antonio Ocampo, said that the LDCs were confronted with numerous formidable challenges, ranging from extreme poverty and lack of basic services to lack of domestic and external resources and post-conflict traumas.
Too many LDCs were currently engulfed in conflict, or just coming out of one, he said. It must be recognized that a central aspect of creating an enabling environment in the LDCs was that there could be no peace without development and no development without peace. Where development failed, countries could become trapped in a vicious cycle. Moreover, weak governance structures and extreme poverty were some of the major factors perpetuating that cycle. Hence, economic policy and stronger institutions could play an important role in preventing potential socio-economic tensions from turning violent.
Several countries had made varying degrees of progress in developing a long-term and multi-dimensional approach to peace and development, he noted. Development partners could and must do more to support LDCs’ national efforts, including towards conflict prevention and the transition to sustainable peace. There was substantial scope for increasing aid and changing its allocation and administration, including better targeting to the countries most at risk of breakdown.
The United Nations system was striving to better coordinate its peacemaking and peacekeeping activities with emergency relief, peace-building and development efforts in a seamless, multi-dimensional and long-term approach. A lesson learned from Sierra Leone and East Timor was the need to integrate development into the very early stages of international crisis response.
An important indicator of a country’s high risk for social conflict or civil war that could keep it mired in poverty was its dependency on primary commodity exports, he noted. According to a recent United Nations Conference on Trade and Development (UNCTAD) report, most of the poor African countries were trapped in the commodity dependence trap. The dependence of African and other LDCs on commodity exports should be reduced. That called for increased international support towards export diversification.
The challenges mentioned must be addressed first and foremost by LDCs themselves, he said. National ownership was critical not only to a successful development strategy but also to successful peace-building initiatives. However, those challenges could only be fully met if the partnerships forged at Brussels and in other international conferences were translated into concrete actions at the national and global levels. At the national level, effective governance and an enabling environment were crucial in meeting those challenges. At the global level, developed countries needed to pay greater attention to the coherence of their policies in terms of their development impact.
ROGATIEN BIAOU, Minister of Foreign Affairs of Benin, and Chairman, Group of Least Developed Countries, said that throughout the Brussels action plan, the LDCs would have to maintain a growth rate of 7 per cent per annum of gross domestic product and raise the investment gross domestic product ratio to 25 per cent yearly. That required substantial new additional and predictable resources. The action plan also stated that it would not be possible in the near future to meet that requirement with the internal resources of the LDCs, particularly because of the weakness and vulnerability of their economies. External resources, therefore, were of crucial importance. For the LDCs, promoting an environment favourable for poverty reduction depended on the effectiveness of the mobilization of external resources. Actions for that purpose should primarily bear on ODA, debt, trade, direct foreign investment, and decentralized cooperation.
Regarding ODA, he said that the action plan had recognized that, in order to reduce the dependency of LDCs on assistance, the volume and effectiveness of assistance must be increased from the outset. It was important for the development partners and non-governmental partners, therefore, to honour their commitments under the plan. On debt, the external indebtedness and debt servicing absorbed a major part of the resources of LDCs, which could otherwise be devoted to productive and social services. That was a serious handicap in development efforts and their ability to combat hunger and extreme poverty. It was necessary, therefore, to ensure availability of resources for LDCs by grappling with their indebtedness problems, including through the HIPC initiative and other debt-relieving measures.
Above and beyond ODA and the private capital imports necessary for financing growth and development, trade for LDCs was an important instrument for mobilizing external resources. The LDCs, however, owing to unfavourable market access conditions could not take advantage of trade opportunities. It was important, therefore, for the development partners to open access to their markets and allow for an increase in the production and technical capacities of LDCs. Also, subregional and regional exchanges were a springboard enabling LDCs to integrate into the world economy. Adequate support was needed for such cooperation, especially through an integrated framework of technical assistance for trade.
He said that direct foreign investment was another important source of capital and served as a catalyst in mobilizing external resources, in order to finance development and promote growth. It was important, therefore, for development partners to encourage capital flows and investment trends for LDCs. Concerning decentralized cooperation, NGOs and other civil society components also played a crucial role in mobilizing resources, which directly went to people at the grass-roots level. That, in turn, helped local development by producing the necessary resources for income generating activities.
AICHA BASSAREWAN, Vice Minister of Planning and Finance of Timor-Leste, said that although her country was new to the process of the Brussels Programme of Action, it had made tangible and significant progress in each of the seven commitment areas. Despite the serious challenges it still faced, it had made encouraging progress in the area of good governance. It had established a functioning civil service from a relatively low human resource base, and had ratified all major human rights treaties and conventions. With donor support, the Government had invested heavily in restoring basic social and physical infrastructure, from health clinics to schools, from road repair to reopening of the Dili airport, and from water supply to partial restoration of electricity services.
She emphasized that the difficulties that the LDCs faced today were formidable and multiple. In the case of Timor-Leste, the challenge of building a sustainable and prosperous nation from a low starting point, with deep scars of colonialism, occupation and the 1999 violence, was even more daunting. Developing human resources and institutions required short, medium and long-term visions and measures. National reconciliation took time, and the creation of an effective justice system in an environment of limited human resources could not be achieved in just a few years.
Timor-Leste, she continued, was also a small nation, vulnerable to external shocks. It faced serious financing gaps in the immediate and medium future. Although it anticipated sizeable oil income in the future, the size of that income was limited, and worldwide experience demonstrated that the country must be vigilant about the negative consequences of dependence on oil income alone.
While a lot of investment had been made in Timor-Leste, she stressed that it was not yet time to stop investing. The success of Timor-Leste required continued support. Otherwise, the investment of the international community might be at risk. Her country fully recognized that the primary responsibility for achieving national development objectives rested with the governments and people of the developing countries. Timor-Leste was doing its part, and she hoped that it would enjoy the continued and generous support of its development partners.
TERTIUS ZONGO, Ambassador of Burkina Faso to the United States, said that opening up to the outside world was now the basis for growth, prosperity and development. A great paradox existed, however. Never before had poverty gone on for so long and the risk of marginalization been so flagrant. He welcomed the convening of the sessions, which raised the question of how to mobilize resources and promote an environment in which to combat poverty. The main challenge facing the LDCs was that of poverty eradication, which required a multi-dimensional approach. He saw poverty daily. He saw monetary poverty, the absence of income, and he saw marginalization and the failure to have access to basic goods and services. Poverty was also exclusion, including from decision-making processes.
He said that economic growth was cited as the panacea for combating poverty and creating wealth. Economic growth alone, however, was not enough to eradicate poverty. It was crucial that institutions and policies be established to allow wealth to be distributed to the poorest groups. Hence, the idea of fairness and governance had emerged and was now mainstreamed in the agencies of the LDCs.
Some “home truths” would help to deal with those issues, he added. The first was that public expenditures for development, whatever their amounts, were more effective when the institutions and policies were the right ones. That required that emerging from poverty be an act of international solidarity. That also meant that recipient countries take steps to create the proper frameworks. The conditionality imposed from the outside did not lead to basic reforms. Development partners must assist in that approach to poverty eradication, by ensuring that the steps taken by recipient States were appropriate.
Developing countries should take the necessary steps to improve their framework for foreign investment, he stressed. That involved governance and the restructuring of legal frameworks. Appeals had been made to the development partners to provide open markets and more resources. An appeal had also been made to financial development institutions to make their interventions of high quality and to harmonize the steps those were taking. He knew what the international community had done since Monterrey in terms of increasing assistance, but what about its quality? What about the opening of markets?
JEFFREY SACHS, Special Adviser to the Secretary-General on the Millennium Development Goals, said that to really improve security, it was necessary to think about the children that were dying in the LDCs -- 100 infants out of every 1,000, as well as the fact that life expectancy in those countries had not improved in 50 years, while life expectancy in the developed countries was 80 years. The Brussels Programme of Action had the answers. The Millennium Development Goals were not being met and would not be met in the LDCs. Resources to meet those goals was the crux of the problem. The commitments made to provide those resources had not been met.
The poor countries were being told not to make a fuss, to take time and improve their institutions, and to not hurry, he said. Having traveled to four countries this month -– Ghana, Ethiopia, Senegal and Kenya -- he reported that in every one of those countries there were sound and ingenious plans on how to get out of poverty. But, the programmes were not funded. The problem was not the lack of plans or lack of commitment or governance, but a lack of resources.
There was talk of the horrors of terrorism every day, he said. But every day, tens of thousands of Africans died of HIV/AIDS and there was no talk of that. The plans existed, but the money did not. The commitment to 0.7 per cent of gross national product to ODA was made 30 years ago and repeated many times since. Speeches would not save children, but bed nets could. It was time to act, and time for the Bretton Woods institutions to consider not budgets, but dying children.
Round Table A –- Resources Mobilization
The round table on resources mobilization for the implementation of the Brussels Programme of Action -- the experiences of Timor-Leste and Bangladesh -- was co-chaired by Aicha Bassarewan, Vice Minister of Planning and Finance of Timor-Leste, and David Lockwood, Deputy Director, Asia and the Pacific Bureau, United Nations Development Programme (UNDP).
The panelists included: Jose Luis Guterres, Permanent Representative of Timor-Leste to the United Nations; Iftekhar Chowdhury, Permanent Representative of Bangladesh to the United Nations; Roberto Soares, Director of Regional Affairs, Ministry of Foreign Affairs and Cooperation of Timor-Leste; Jeffrey Sachs, Special Adviser of the Secretary-General on the Millennium Development Goals; Haoling Xu, Senior Deputy Resident Representative of the UNDP in Timor-Leste; and Eduardo Doryan, Special Representative of the World Bank to the United Nations.
Presenting the experiences of Timor-Leste, Ms. Bassarewan said that resources mobilization was a very important issue for her country. Since the restoration of independence, many efforts had been taken to better develop the country and meet the basic needs of the people. After the events of September 1999, her country had had strong support from the international community and the economy had improved.
However, following the scaling down of the United Nations presence, international assistance had faced a set back, she continued. The Government was working on creating an enabling environment for the private sector and job creation. The hope of the people was to have enough food, and access to good education and health care. The Government had a development plan known as Vision 2020, as well as a national plan for its implementation. Resource mobilization was crucial for the country to achieve the plans and programme it had designed.
Mr. Chowdhury presented the situation in his country, saying that, since independence, Bangladesh had come a long way. Its success was owed to, among other things, sound socio-economic policies, appropriate use of external support, pro-market policies, the emergence of a vibrant civil society and homegrown ideas. Development must be nationally owned, designed and driven. Bangladesh was in the process of finalizing its Poverty Reduction Strategy Paper (PRSP), into which the commitments made in Brussels had been incorporated.
Since Brussels, Bangladesh had moved forward significantly, including through the establishment of institutions such as the National Human Rights Commission. However, as in other LDCs, it was difficult to implement the mandates of those institutions without external support. It was important that development partners fulfilled their resource commitments and untied their support. Today, his country was determined to give its people a better way of life, the primary responsibility for which lay with the country itself. Bangladesh still had a long way to go, but at least it knew now that there was light at the end of the tunnel.
In a powerpoint presentation, Mr. Xu noted that Timor-Leste’s gross domestic product was $410 per person. It had a limited economic base and faced many challenges. The country was embarking on a new phase of development. External financing was already decreasing. At the same time, population growth was still relatively high. He emphasized that, with the continued support of the international community, Timor-Leste could achieve its development goals.
In the discussion that followed, Mr. SACHS noted that the one thing similar about both countries was that they were inspiring. Bangladesh was an example of what could be achieved through homegrown ideas. Both cases also showed how precarious the struggle was. In Timor-Leste, the donors were already fatigued. The attention span of the world was short, and once the attention went away, the aid dropped quickly.
A lesson from Bangladesh for Timor-Leste, he noted, was the fertility rate. High fertility rates must be reduced. More help was still needed for Bangladesh, despite the progress made. For example, a large portion of the population was drinking arsenic laden water. The World Bank and others had not been effective in providing resources to get that problem under control.
Among the questions raised during the discussion was whether resources alone were enough to achieve development goals, as well as how to mobilize resources so that the Brussels Programme of Action could be implemented. It was necessary, stated some speakers, to examine not only the volume but the quality and effectiveness of aid, as well as the potential of South-South and triangular cooperation.
The timing, sequencing and highest impact of donor assistance was also raised, as was the trend of donors to increase their conditionalities for assistance. How would it be possible to see to it that all donors agreed on a minimum set of conditionalities, and that they did not increase their conditionalities, it was asked.
In that connection, the panel stressed the importance of the donor-recipient relationship. It was important to enter into a relationship that would sustain attention, it was stated.
Round Table B
Round Table B was entitled “Impact of good governance and public finance management on the mobilization of domestic resources: the experience of Benin”.
Participating in the round table were: Co-Chairs, Rogatien Biaou, Minister of Foreign Affairs of Benin and Chairman, Group of LDCs, and Patrizio Civili, Assistant Secretary-General for Policy Coordination and Inter-Agency Affairs, Department of Economic and Social Affairs (DESA); Maria Eugenia Brizuela de Avila, Minister of Foreign Affairs of El Salvador; Seraphine Wakana, Minister for Planning, Development and Reconstruction of Burundi; John Richardson, Ambassador, Head of the Delegation of the European Commission to the United Nations; Marcello Spatafora (Italy); Jeffrey Katz, Manager, Partnerships and External Affairs Group for the Africa Group, the World Bank; Reinhard Munzberg, Special Representative of the International Monetary Fund (IMF) to the United Nations. The representative of Nepal, Murari Raj Sharma, also spoke, as did a consultant in the field, Lene Poulsen.]
Opening the discussion, PATRIZIO CIVILI, Assistant Secretary-General for Policy Coordination and Inter-Agency Affairs, DESA, recalled the outcome from Brussels, which had emphasized that success in the mobilization of domestic resources truly depended on good governance within each country and, at the international level, transparency in the financial, monetary and trading systems. No one contested that each country must squarely take on the primary responsibility for its social and economic development, he added.
Chairing Round Table B was ROGATIEN BIAOU, Minister of Foreign Affairs of Benin and Chairman, Group of LDCs, who recalled that his country had begun a process of democratization some 14 years ago. Institutions had been set up at the national level, the rule of law had been constructed, and fundamental freedoms and human rights had been protected and defended. A national independent electoral commission had also been set up. So far, there had been three successful and peaceful presidential elections, and four legislative elections. Work to overcome poverty and root out corruption was long and complex, but it was under way. For example, Benin had imprisoned 100 judges who had been involved in corruption.
Noting that a process was also in the works to mobilize domestic resources by inspiring the confidence of the local producers, who were mainly cotton growers, he said the international community now acknowledged that assistance must be given to African cotton producers. The aim of a workshop next week was to turn Africa’s cotton and its exploitation away from gross export to semi-finished or finished products, so there would be added value, thereby increasing domestic resources for development. Clearly, agricultural subsidies, particularly for cotton, diminished efforts to mobilize internal resources. The second factor impeding normal growth was that direct foreign investment was not in keeping with the appeal made at Brussels.
Among the other issues highlighted in the discussion was the importance of citizens’ trust in programmes and projects for social development. The Minister for Foreign Affairs of El Salvador, MARIA EUGENIA BRIZUELA DE AVILA, said her Government attached great importance to good governance through eradicating corruption, not only through adoption of legislation, but also through ensuring “ownership” of the citizenship and accountability of elected officials. While her country was no longer an LDC, its progression from war and total social collapse to one of the three Central American countries that had enjoyed a degree of development could serve as an example of what could be achieved through the sound utilization of certain premises. States bore the primary responsibility for achieving national development, but those must also enjoy international support.
Similarly, the Minister for Planning, Reconstruction and Development of Burundi, SERAPHINE WAKANA, highlighted programmes under way to achieve good governance, following conflict, was now working towards sound economic development. Still, as a post-conflict State, there were emergency aspects requiring urgent attention before the country could truly relaunch the economy, and the very important tasks of consolidating peace, easing ethnic tensions, and reforming the security and defence corps. Peace and development went hand in hand; without peace, no other initiative would go forward. The Government was seeking external assistance to reintegrate the displaced persons. At the same time, it had designed a strategic poverty eradication framework, while also seeking to address the worsening HIV/AIDS pandemic. The Government was also trying to strengthen institutional capacities, as those had been greatly weakened by the conflict.
A recurring theme was the need for a national strategy with which to combat poverty. JOHN RICHARDSON, Ambassador, Head of the Delegation of the European Commission to the United Nations, said the European Union had been supporting Benin’s efforts to fight poverty on the basis of its poverty eradication strategy paper, which enabled the Union to include budgetary support to Benin’s anti-poverty programmes. He also emphasized the importance of a regional perspective, which disciplined member countries to conform to agreed principles of sound governance and financial and institutional reforms.
Also stressed by several speakers was the link between good governance and sound public financial management, in order to help mobilize domestic resources and attract resources from abroad. The only sure route to sustained economic development, the United States’ speaker said, was through increasing domestic production capacity and resource mobilization, for which the primary responsibility lay with the developing countries and their ability to create conditions to make it possible to secure needed resources for investment.
The importance of responsible tax systems was also emphasized, including by the representative of Burkina Faso, who insisted that taxes were an instrument of social justice through which citizens must meet their obligations to their nations. Such an instrument required good management and good governance and should take place in a transparent framework. The best way to expand a taxation base was to move towards decentralization. If schools and roads were built, people could see first-hand the benefits of their taxes. Indeed, decentralization would extend democracy and promote good governance.
Representatives of the World Bank and the IMF offered their views on the topic. Speaking for the World Bank, JEFFREY KATZ, Manager, Partnerships and External Affairs Group for the Africa Region, acknowledged that the availability of ODA was very much affected by assessments of governance. That condition was the basis on which the Bank evaluated distributions. The form in which external resources were available was also determined largely by assessments of conditions of governance. The international rules affecting trade also had an impact on the question at hand, as did public services and their interaction with the tax systems.
The Fund’s Special Representative to the United Nations, REINHARD MUNZBERG, stressed that the issue of global governance and domestic governance could not be dissociated. The messages of the Millennium Declaration and recent global conferences had been consistent, especially emanating from Monterrey. The latter had clearly spelled out the two pillars of work, namely the need for external assistance, open trade and market access, among others, on the international side; and, on the domestic side, sound governance, institutional capacity-building, tax collection and administration.
Round Table C
Round table C, entitled “Poverty reduction strategy papers (PRSPs) as a mechanism for resources mobilization: the experience of Burkina Faso”, convened in the afternoon.
Participants included: Tertius Zongo, Ambassador of Burkina Faso to the United States; Jeffrey Katz, Manager, Partnerships and External Affairs Group for the Africa Region, World Bank; Mark Plant, Assistant Director, Policy Development and Review Department, IMF; and Harris Gleckman, Chief, New York Office of UNCTAD; Bissiri Sirima, Adviser to the Prime Minister of Burkina Faso on Economic Matters; and Member States’ representatives from Benin, Sweden, Ghana, United States, and Mauritius. A representative of the International Association of Socio-Economic Councils also spoke.
Opening the discussion, Mr. KATZ of the World Bank recalled the many early negative perceptions about the papers. It had been said, for example, that countries did not have the capacity to prepare national poverty strategies and that participation would not be very real or visible, but just for show. It had also been said that donors, in particular the World Bank and the IMF, would dominate the process of preparing the papers and not respect countries’ leadership in the process. The experience, as many had observed, had been that those initial fears and conceptions had not been borne out.
He said that many countries had taken seriously the national strategies and had prepared them themselves, with considerably more participation than had been initially thought. Also, donors had not attempted or succeeded in attempting to write those papers on behalf of the countries. There was some way to go, however, towards realizing the promise of those papers and pave the way for a profound change in the way donors and countries operated. There was also a ways to go before those strategies became the sole papers to which all referred.
Mr. ZONGO of Burkina Faso said that the subject of governance, formerly taboo, had become a high priority theme. In parallel to that development, there had been the adoption of PRSPs, and the New Partnership for Africa's Development (NEPAD) had started to make operational a new framework for development. The documents for poverty reduction had laid down a national strategy to be achieved at the end of a participatory process that involved several elements of society and development partnerships.
Among the guiding principles for the documents were acceptance that they had undergone all stages of consultation, and that they were federal and the sole strategy to which the country and its development partners referred, he said. Also, a policy-making mechanism should be established to attain consensus on how to achieve results. Then, there must be consensus on the modalities for achieving those results, as well as on how to assess them. Results must be based on national capacities to conduct reforms and define their contents and pace.
Mr. SIRIMA, Adviser from Burkina Faso summarized a detailed document of the Government on its experience with budgetary matters, which had been distributed during the discussion. He reviewed the period of adjustment in his country since 1991, stressing that, at the end of 10 years Burkina Faso had become aware that significant gains had been made, but those had not delivered the needed results to combat poverty. Offsetting the cotton losses from drought, easing the debt, expanding human resources capacity and school enrolments were among the elements needed to get the country on track. In reforming the aspect of conditionality, as that pertained to assistance, it was important for countries, such as Burkina Faso, to receive budgetary support, rather than project support, as that would enable them to act.
Reviewing the two main themes that had emerged throughout the day’s discussions, Mr. PLANT of the IMF said that more resources were needed to enable the LDCs to meet their challenges, reduce poverty, and meet the Millennium Development Goals, and doing so was not a matter of resources, but of national capacity. The LDCs clearly needed the financial support of the developed world while developing their capacity to use that money to good effect. The PRSPs were proving to be a potentially fruitful way to marry those seemingly competitive but complementary objectives.
He also pointed to a tension in the papers between realism and ambition. The Fund was always thought to be too realistic, warning governments not to go down certain roads. Money flowing into a country could be a mixed blessing if that was not managed carefully. Another area of tension was between ownership and donor harmonization. Ways had to be considered in which donors could respond to their constituencies and make sure their monies were being used property in the country, while giving that country the room to plan over the medium-term. The PRSPs were an essential tool to turn more money into essential results, he said.
Agreeing with the many expressions of support for the PRSPs, Mr. GLECKMAN of UNCTAD added that coherence between national development strategies and global economic policies should be examined. The structural adjustment and poverty reduction strategy papers had come to life in 1999 and had been followed by several other goal-setting exercises, including the Brussels Programme of Action and the Millennium Development Goals. Somehow, that evolving experimental package had to be translated into reality, and the international community needed to be able to integrate those commitments into its own documents. Another way in which that coherence challenge arose concerned the relationship between the indices -– social, environmental, and gender-related -- with the usual macroeconomic indicators.
Several Member States advanced the view that the PRSPs already served as reference documents, making it possible to have a framework to facilitate efforts by both the countries and the donor partners. Benin’s Minister called the strategic documents “a much more rational vision of actions to be taken over a period of years”. Those were dynamic and could be revised either at the end of three or five years, taking into account both the positive and negative elements of implementation. Also, certain experience had been gained through drafting the papers in a participatory manner involving all strata of the government and civil society.
The United States’ Government had been one of the earliest proponents of PRSPs, its speaker said. Those papers ensured country “ownership” of financial institutions’ lending programmes. Her Government had also consistently supported efforts to strengthen participation, which was particularly important in countries with weak democratic institutions. While maintaining integrity throughout the process, countries should be encouraged to set targets, create open policy formulations and improve public expenditures management. Her Government conducted independent reviews of all PRSPs and provided its views on both the documents and the processes by which they were drafted to the IMF and World Bank board discussions.
MARJATTA RASI (Finland), President of the Council, said that today’s round tables made it clear that much more needed to be done to achieve the targets in the Brussels Programme of Action and to attain the Millennium Goals in the LDCs. A wide range of issues were addressed from resources mobilization to PRSPs. Reiterating some of the recommendations made, she noted that while the Millennium Development Goals and the Brussels Programme of Action provided the overall framework for action, the focus now must be on implementation. The need for a comprehensive approach to development was also emphasized. Also, the primary responsibility lay with the LDCs themselves. However, international partners had a crucial part to play to support the efforts of LDCs. The most important message was that the targets in the Brussels Programme of Action and the Millennium Development Goals could not be achieved in the LDCs with the resources available at present.
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