AS FINANCIAL CRISIS OF ENORMOUS PROPORTIONS UNFOLDS, SECRETARY-GENERAL URGES FOCUS ON POLICY OPTIONS TO HELP HEAVILY INDEBTED POOR COUNTRIES, AT DOHA SIDE EVENT

1 December 2008
SG/SM/11974-DEV/2719

AS FINANCIAL CRISIS OF ENORMOUS PROPORTIONS UNFOLDS, SECRETARY-GENERAL URGES FOCUS ON POLICY OPTIONS TO HELP HEAVILY INDEBTED POOR COUNTRIES, AT DOHA SIDE EVENT

1 December 2008
Secretary-General
SG/SM/11974
DEV/2719
Department of Public Information • News and Media Division • New York

AS FINANCIAL CRISIS OF ENORMOUS PROPORTIONS UNFOLDS, SECRETARY-GENERAL URGES FOCUS


ON POLICY OPTIONS TO HELP HEAVILY INDEBTED POOR COUNTRIES, AT DOHA SIDE EVENT


(Delayed in transmission.)


Following is the text of Secretary-General Ban Ki-moon’s remarks to the side event on “Debt Relief, Debt Sustainability, and the Millennium Development Goals in HIPCs”, in Doha, 30 November:


I welcome this opportunity to speak with you on the critical issue of debt.  I thank the World Bank and International Monetary Fund for bringing us together.


This discussion is especially timely.  A financial crisis of enormous proportions continues to unfold.  The devastating effects of the turmoil are reverberating around the world.  We could lose hard-won development progress.  Prospects for financing development goals, including the Millennium Development Goals, are getting even more uncertain.


The Monterrey Consensus stressed the key role of external debt relief in freeing up resources to promote sustainable growth.


And, indeed, there has been good progress in providing relief to the Heavily Indebted Poor Countries (HIPCs).  Now, we need to do more to relieve the debt of other States that are climbing the development ladder.


However, there are many obstacles.


Some beneficiaries of relief under the HIPC effort face litigation by creditors and vulture funds.  We will have to look closely at the legal basis for debt relief so that we can avoid this in the future.  The United Nations and the Bretton Wood institutions should work together on this question.


We must also pay close attention to other vulnerabilities experienced by countries shouldering large debt burdens.  As migrant workers lose their jobs, remittances go down, affecting national economies.  The fall in commodity prices and export revenue will also have an impact.  And shortfalls in official development assistance are certainly going to hurt.


The international community took important steps forward on debt at Monterrey.  Countries agreed on the importance of debt relief.  They called for additional financing.  And they emphasized the need to maintain debt at sustainable levels through grants and loans.


Our challenge is to speed up efforts to translate these principles into meaningful action.


I am pleased that this gathering will analyse how the changing external environment is affecting debt sustainability.


I urge you to focus on possible policy options that would help affected countries manage their debt.


Let us move quickly to solve this critical issue, and put poor countries on more solid ground as they strive to reach the MDGs [Millennium Development Goals] and other development goals.


Thank you again for this contribution to advancing the global development agenda.


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For information media • not an official record
For information media. Not an official record.