Speakers Call for Fair Multilateral Trading System to Ensure Sustained Growth, as Second Committee Debates Macroeconomic Policy Questions
Exports had remained stagnant or drastically declined due to low world prices, failure to adapt to changing markets and policies penalizing their traditional activity, Maldives’ delegate told the Second Committee (Economic and Financial) today as it began its debate on macroeconomic policy questions.
Speaking for the Alliance of Small Island Developing States, he said those nations were heavily dependent on imports, while exports were a central source of foreign exchange and cash income. Stressing the need for a fair multilateral trading system to ensure sustained growth in global trade, he said the international trade regime should accommodate the needs of small island States.
Similarly, Bangladesh’s representative, speaking for the Group of Least Developed Countries, said they had increased their share in world goods and commercial services exports from 0.7 per cent in 2005 to 1.03 per cent in 2014, but that it had dropped by 20 per cent in 2015. Small islands were losing comparative trade advantage due to reduced tariff lines under the World Trade Organization.
Erosion of preference and loss of tariff revenue, as well as employment and various kinds of adjustments, should be fully compensated for least developed countries, he continued. They urgently needed duty- and quota-free market access for all products, simplified and transparent rules of origin and financial and trade capacity-building.
Malaysia’s delegate, speaking for the Association of Southeast Asian Nations (ASEAN), said, on a more positive note, that trade in his group had remained upbeat and economies resilient, with gross domestic product (GDP) nearly doubling since 2007. Stressing that trade must be supported by deliberate policies and global partnerships, he said regional trade liberalization had contributed significantly to freer movement of goods across ASEAN member States.
Introducing the report, “Trade and Development Board on its sixty-second executive session” (document A/71/15 Part I), a senior official of the United Nations Conference on Trade and Development (UNCTAD) said the world was in a period of weak trade growth that could seriously affect delivery of the Sustainable Development Goals. World merchandise trade volume grew by only 1.5 per cent in 2015, and world trade in both goods and services contracted that year for the first time since the financial and economic crisis of 2008‑09.
Global trade dynamism might have already passed its peak levels as value chains became less dynamic relative to GDP growth rates, he said. Least developed nations were behind in meeting the target of doubling their share of world trade as set out under the Istanbul Programme of Action and under the Sustainable Development Goals.
Belarus’ delegate, also noting that trade volumes were declining worldwide, warned that they would be at their lowest since the Second World War if that trend continued. Her Government was pushing for a trade cooperation action plan with middle income countries, as they had been cast aside when it had come to trade and development agreements.
Speakers also focused on the need to cancel least developed countries’ debt and increase official development assistance for all developing countries if they were to achieve the 2030 Agenda for Sustainable Development. They also stressed the need to reform the international financial architecture and tackle volatility in exchange rates as well as financial flows.
Also speaking were representatives of Thailand (for the “Group of 77” developing countries and China), Jamaica (for the Caribbean Community), Dominican Republic (for the Community of Latin American and Caribbean States), Australia (for the Cairns Group), Brunei Darussalam, Philippines, Mongolia, India, Russian Federation, Indonesia, Norway, Peru, Burkina Faso, Singapore, Zambia and Brazil.
Presenting reports on Follow-up to the International Conferences on Financing for Development (document A/71/311) and the international financial system and development (document A/71/312) was the Director of the Financing for Development Office, Department of Economic and Social Affairs. Introducing the report on international trade and development (document A/71/275) was the Head of the Trade Negotiations and Commercial Diplomacy Branch, United Nations Conference on Trade and Development. Presenting the report on external debt sustainability and development (document A/71/276) was the Head of the Debt and Development Finance Branch, United Nations Conference on Trade and Development.
The Second Committee will reconvene at 10 a.m. on Friday, 21 October, to continue its debate on macroeconomic policy questions.
Introduction of Reports
ALFREDO SUESCUM, President of the United Nations Conference on Trade and Development (UNCTAD) Trade and Development Board, introduced the report on the Trade and Development Board on its sixty-second executive session (document A/71/15 Part I). Both the 2030 Agenda for Sustainable Development and the Paris Agreement on climate change were aimed at pressing development challenges, he said. The organ’s three pillars of work — consensus-building, research and analysis, and technical cooperation — could contribute to the realization of relevant outcomes of United Nations conferences and summits that defined the global agenda. Follow-up on the development agenda was placed front and centre. Members committed to making full and focused use of UNCTAD’s facilities to address key development issues. That acknowledged the widespread value placed among development stakeholders. The ideas exchanged that emerged in those dialogues could permeate in the development community and influence the direction of global action.
Members called for the revitalization of UNCTAD’s intergovernmental machinery. Business as usual was no longer sufficient, and the Conference’s intergovernmental bodies needed to engage in more and more effective consensus-building of clear relevance to both the General Assembly as well as the major processes in which UNCTAD engaged. The Nairobi Mafikiano called for concrete policy recommendations for consideration by the Trade and Development Board with input from the General Assembly. It was worth reviewing the Board’s relationship with its parent and subsidiary bodies, as well as the timing of meetings in Geneva and the nature and scope of outcomes of intergovernmental meetings. The New York outcomes could also be better incorporated into the work of UNCTAD’s intergovernmental machinery in Geneva. Under the Nairobi Mafikiano, members were encouraged to try as well to make interactions in the intergovernmental pillar more effective.
ALEXANDER TREPELKOV, Director of the Financing for Development Office, Department of Economic and Social Affairs, introduced the Secretary-General’s reports on Follow-up to the International Conferences on Financing for Development (document A/71/311) and the international financial system and development (document A/71/312). He noted that international financial flows to developing countries had fallen in 2015 and were expected to fall further in 2016, reflecting rising global risks and heightened risk aversion. Global trade growth remained weak, as did world commodity prices, creating economic stress in many commodity-exporting developing countries. Increased divergence in global interest rates could intensify the volatility of capital flows and pressure exchange rates in developing economies. The challenging global environment underscored the need for urgent action to implement the new development agenda, including ensuring a stable global financial system that intermediated credit towards sustainable development.
Private business investment and innovation were major drivers of growth and employment, he continued. However, as of mid-2016, capital investment appeared to be depressed in many economies. There had been much interest in increasing allocations by institutional investors in sustainable development. Indeed, in recent years there had been a shift in asset allocation by such investors to less liquid assets, reflecting their “search for yield”. There had also been growing efforts to integrate environmental, social and governance factors into portfolio selections. However, such developments were far from being mainstreamed in financial markets. More broadly, the financial system and its capital markets did not incorporate the full social and environmental costs of companies, raising questions on how to better align investment incentives with sustainable development.
MINA MASHAYEKHI, Head of the Trade Negotiations and Commercial Diplomacy Branch, United Nations Conference on Trade and Development, introduced the Secretary-General’s report on international trade and development (document A/71/275). Noting the fundamental importance of trade for development, she said it was a matter of concern that the world was in a period of weak trade growth that could have long-lasting implications towards delivering on the Sustainable Development Goals. In 2015, world merchandise trade volume grew by only 1.5 per cent, and world trade in both goods and services contracted in 2015 for the first time since the financial and economic crisis of 2008‑09. Global trade dynamism might have already passed its peak levels as value chains became less dynamic relative to gross domestic product (GDP) growth rates. Least developed countries were not on track to meet the target of doubling their share of world trade as set out under the Istanbul Programme of Action and under the Sustainable Development Goals.
UNCTAD held its fourteenth ministerial meeting in July, and its outcome document, “Nairobi Maafikiano”, set out global consensus on major action lines to achieve the Sustainable Development Goals, she said. Those actions included the building productive capacities to transform economies, ensuring more effective States and more efficient markets, tackling vulnerabilities and strengthening multilateralism. The report highlighted two transformative shifts, namely the potential of global value chains and the increased significance of services economy and trade, particularly in the digital economy. The document stressed the necessity of revitalizing the multilateral trading system as a global public good with renewed momentum.
STEPHANIE BLANKENBURG, Head of the Debt and Development Finance Branch, United Nations Conference on Trade and Development, introduced the Secretary-General’s report on external debt sustainability and development (document A/71/276). She noted a marked drop in export growth rates from 16.6 per cent per year in 2000‑2008 to 6.5 per cent in 2009‑2015. Overall, there had been a gradual deterioration of debt ratios, as total debt to GDP had crept up to 25.5 per cent by 2015 and debt service to exports had increased to 11.5 per cent, although with clear regional variations. Small island developing States showed the worst performance persistently, with a five-fold increase in total debt in the last 15 years, reaching $53 billion in 2015 from $10.8 billion in 2000, and total debt to GDP had risen from 45 per cent in 2000 to 85 per cent in 2015. Least developed countries showed a similar picture, but with an increasing reliance on issuance of sovereign international bonds were now implying sharp increases in yields on those bonds in some cases.
Improvements achieved in the more recent past may not last, she continued. New debt obligations had built up under benign external conditions in the short term and in largely uncoordinated ways, creating a mix of public and private, direct and contingent liabilities. In shifting to domestic public debt, Governments could shift the currency risk to international lenders and reduce their vulnerability to exchange rate volatility. The debt of non-financial corporations in emerging and large developing economies more than tripled from $7.6 trillion at the end of 2008 to $24.5 trillion in the first quarter of 2016, reaching just over 100 per cent of GDP on average. That explosion of corporate debt in emerging economies had occurred against a background of highly volatile international capital flows.
Statements
PATTAMAWADEE AUEAREECHIT (Thailand), speaking on behalf of the “Group of 77” developing countries and China, said that financing for development was an integral part in supporting and complementing the implementation of the 2030 Agenda. To that end, North-South cooperation was still the main channel of financing for development. It was important for ODA providers to meet their commitments. The world continued to face challenges which undermined the implementation of the 2030 Agenda, including the weakness in the global recovery, sharp decline of commodity exports, financial market volatility, high unemployment rates and rising private and public debt burdens. Coherent and coordinated macroeconomic policy was needed more than ever. For instance, international trade — the engine for inclusive growth — must be fair and balanced, open, inclusive and non-discriminatory. Pursuant to that, it was time to conclude the Doha Round of World Trade Organization (WTO) negotiations.
She stressed the need to continue to broaden and strengthen the voice and participation of developing countries in international economic decision-making and norm-setting. The Group called for the full implementation of the 2010 International Monetary Fund (IMF) Quota and Governance Reforms. A new quota formula was needed that further shifted quota shares to dynamic emerging market and developing countries while protecting the quota share of the poorest countries. It was also important to achieve equitable voting power between developing and transition countries and developed nations while protecting the smallest poor countries. Debt had a severe impact, especially on the heavily indebted poor countries. Long-term debt sustainability through coordinated policies with respect to fostering debt financing, debt relief, debt restructuring and sound debt management were most relevant.
RAJA REZA BIN RAJA ZAIB SHAH (Malaysia), speaking on behalf of the Association of Southeast Asian Nations (ASEAN) and associating himself with the Group of 77, said international trade had decelerated markedly in recent years. Against that backdrop, the economy of the ASEAN member States had remained relatively resilient, with GDP nearly doubling since 2007. The bloc remained a major destination of global foreign direct investment (FDI) with many multinational enterprises continuing to strengthen their footprint in the region through manufacturing, finance, infrastructure and other services. Agreeing with other speakers that trade was a key enabler of achieving the Sustainable Development Goals, he said trade must be supported by deliberate policy actions and global partnership and welcomed the fact that regional trade liberalization and facilitation had contributed significantly to the freer movement of goods across ASEAN member States.
While micro, small and medium-sized enterprises were important economic actors in the region, he warned that such businesses often had limited information on how to access markets and lacked awareness on international requirements. A lack of technological awareness also prevented them from participating in the global value chain. The 2015 establishment of the ASEAN Economic Community had contributed significantly to strengthening economic development and the expansion of extra- and intra-ASEAN trade and investment. Noting that the region was now focused on implementing the ASEAN Economic Community Blueprint 2025, he went on to reaffirm that ODA remained a main source of international development financing and recommit the Association to achieving the obligations laid out in the 2030 Agenda and the Addis Ababa Action Agenda. The current economic situation made it all the more necessary for developed countries to fulfil their ODA commitments and provide genuine debt relief to the least developed countries.
E. COURTENAY RATTRAY (Jamaica), speaking on behalf of the Caribbean Community (CARICOM), said that effectively translating the ambitious 2030 Agenda was a sobering task. It was clear that merely espousing the importance of key issues would not deliver the future CARICOM wanted. Small island developing States were challenged to alter their mindsets and approaches in order to successfully adapt to a more difficult environment, he said, adding that adjusting to new global circumstances was nothing new for the group.
Indeed, the commodity exporting and service-based economies of the Caribbean region were fully exposed to the vagaries of the global economy, he continued. Those risks had been exacerbated by structural characteristics such as limited productive capacity and a narrow economic base. Such wide-ranging impacts on the region’s economies had led to unsustainable debt burdens, low growth rates and high levels of vulnerability to exogenous economic and environmental shocks. As a result, the unique challenges of CARICOM member States should be taken into consideration in the context of sustainable development.
AHMED SAREER (Maldives), speaking for the Alliance of Small Island States, said it viewed international trade as a crucial engine for development. The island States were heavily dependent on imports, while exports were a central source of foreign exchange earnings and cash income generation. Export activity had remained stagnant, and in some nations, suffered a serious decline due to low world prices for traditional exports, failure to adapt to changing market conditions and the adoption of policies that had penalized export activity. The Alliance reiterated the need for a fair multilateral trading system to ensure sustained growth in global trade and a system in which the international trade regime could accommodate the needs of small island developing States. The systemic deficiencies of international monetary, financial and economic institutions must be addressed through serious reform.
Small island developing States remained among the most indebted countries in the world, due to a weak export sector, reduction in tourism and economic risks linked to natural hazards and climate change, he said. The adverse decline in fishing and agricultural sectors would likely trigger a new cycle of debt issuances and reconstruction efforts after natural hazards would further exacerbate debt burdens. Maldives was “heartened” to note the establishment of the Financing for Development Forum, as it would serve as the proper follow-up to the Addis Ababa Action Agenda.
FRANCISCO ANTONIO CORTORREAL (Dominican Republic), speaking on behalf of the Community of Latin American and Caribbean States (CELAC), said that at its last summit, the Community affirmed the importance of implementing the international framework for development financing in the spirit of global partnership and solidarity. Of particular importance in that regard was the commitment of developed countries to attain objectives in ODA. In addition, financing for sustainable development required the mobilization and effective use of new and additional resources, financial and non-financial, public and private, domestic and international. It also required increased South-South and triangular cooperation as a complement and not a substitute for North-South cooperation.
He also reiterated the need to strengthen the international financial architecture, to create an international environment that supported national planning and to recognize the importance of debt relief to promote adequate funding for development. Sustainable development must be approached with an integrated and holistic perspective with due respect for each country’s policy space, as piecemeal approaches distorted the situation, especially in middle-income countries. Noting that all such ideas had been proposed over decades, he urged intensified work on their implementation. If the international community did not take profound, comprehensive and coordinated action on macroeconomic issues, he warned, it would be impossible to overcome poverty, hunger, inequality and marginalization of untold millions of people in his region and worldwide.
MASUD BIN MOMEN (Bangladesh), speaking for the Group of Least Developed Countries and associating himself with the Group of 77, stressed that trade made up a significant portion of least developed country economies. Their exports of goods and services grew by an annual average of 7.6 per cent between 2005 and 2015. The Group was able to increase its share in world exports of goods and commercial services from 0.7 per cent in 2005 to 1.03 per cent in 2014. However, he expressed concern that least developed country exports of goods and commercial services dropped by 20 per cent in 2015. He stressed the need for duty-free and quota-free market access for all products from all least developed countries, simplified and transparent rules of origin, financial and technical support for trade capacity-building as well addressing non-tariff barriers. Also, least developed countries were losing comparative trade advantage due to the reduction in overall tariff lines under WTO. The erosion of preference, loss of tariff revenue, loss of employment and various kinds of adjustments should be fully compensated for least developed countries.
Continuing, he said that total external debt stock of least developed countries had reached $242 billion in 2015, an increase of 72 per cent in the past 15 years. Overall debt in those countries had worsened since the onset of financial crisis in 2008. Both debt to GDP and debt to export rates had increased. The ratio of debt service to GDP had also escalated. Considering the lack of comprehensiveness in the existing debt relief mechanisms, least developed countries were constantly asking for full debt cancellation. If a State fulfilled the criteria of being a least developed country, it should be eligible for debt write-off. Debt relief must be in addition to ODA, as that was a commitment by the international community. Furthermore, debt sustainability assessment must be based on a country’s need for achieving the 2030 Agenda as well as realistic and objective risk assumption.
CORY BERNARDI (Australia), speaking for the Cairns Group of 19 agricultural exporting countries, said that in the 30 years since the Group was established, it had provided a strong voice for agricultural trade liberalization. Much had changed in the trade landscape, including the completion of the Uruguay Round and the commencement of the Doha round of trade negotiations. The elimination of export subsidies as agreed in Nairobi had been a high priority for the Cairns Group since its formation. Those subsidies harmed farmers around the world, contributing to poverty and undermining food security in developing and especially least developed countries. “The removal of these subsidies should be celebrated,” he said.
Yet much remained to be done, he said. Imbalances and distortions in world agricultural trade remained, and the livelihoods of farmers and food security for all were dependent on continued reform efforts. Consensus was building towards an outcome on ending trade-distorting domestic subsidies, something the Cairns Group had advocated for 30 years. “We want to create a fairer global trading environment for farmers in all countries,” he said. Subsidies were promoting excess production and depressing world prices, discouraging the efficient production of food and undermining food security. In Nairobi, the WTO had shown that it was possible to produce meaningful outcomes, and it would be important to continue achieving such outcomes going forward.
MAHIRAH MAHUSIN (Brunei Darussalam), associating herself with the Group of 77 and ASEAN, said it was more vital than ever to uphold a multilateral trading system that would allow for open trade, regardless of the size of a country’s economy. Warning against the enactment of new trade barriers, she said that, despite the growing sentiment against open trade, it was crucial to advance efforts towards economic integration. It was imperative that the benefits and opportunities resulting from open trade were spread evenly, especially as pockets of extreme poverty continued to persist around the world. In that regard, she underscored the importance of working within multilateral, inclusive frameworks such as the WTO and recalled that Brunei Darussalam had been among those countries that submitted the Instrument of Acceptance of the Trade Facilitation Agreement in December 2015. Nationally, the country had worked to enhance its overall competitiveness through structural reforms and other domestic improvements.
IRENE SUSAN BARREIRO NATIVIDAD (Philippines) said that slow economic growth and the global financial system’s uneven pace of recovery had potentially hampered progress in eradicating poverty. Although the Philippine economy had seen strong quarterly growth, she said, the rate “invites guarded optimism as the threat of fragility, economic shocks and susceptibility to natural and manmade disaster remain”. Her Government recognized the importance of UNCTAD and called for the strengthening of its role as the focal point within the United Nations system for trade and development. She also strongly urged creditors to provide realistic lending conditions that would help developing countries keep their sovereign debt at manageable levels and achieve financial resilience. The Philippines was pursuing a comprehensive tax reform that would discourage evasion and broaden the tax base, instead channelling those resources into public investments that would raise some 10 million Filipinos out of poverty.
SUKHBOLD SUKHEE (Mongolia), associating himself with the Group of 77, said economic growth in Mongolia had slowed dramatically due to a drop in world commodity prices, wide budgetary expenditures and sovereign debt pressures. The Government was therefore aiming to expand the economy in the medium term, ensuring macroeconomic stability, diversifying the economy’s structure, reducing vulnerability to commodity price fluctuations, easing balance of payment pressures, lessening the debt burden and generating economic resilience. He echoed the Group of 77’s call for the promotion of a multilateral trading system that would improve the financing capacity of developing countries to enhance development. To achieve the Sustainable Development Goals by 2030, the Government was highlighting the importance of developing the agricultural sector, improving logistics networks and increasing investment in different sectors and in new technologies.
ASHISH SINHA (India), associating himself with the Group of 77, said that the world was increasingly complex and interdependent, but also very unequal in its levels of development. The 2030 Agenda recognized that interconnectedness as well as the scale of the challenge ahead. The world faced commodity price volatility, weak trade, high private and public indebtedness, inequality and lack of inclusiveness, as well as geopolitical concerns such as terrorism and refugee flows. The promotion of policies for enhancing economic growth, including implementing decisions made at the Bali and Nairobi Ministerial Conferences, and further movement on the Doha Development Agenda, needed to be the top priority. India reiterated its support for the multilateral trading system and the centrality of WTO. The establishment of a Technology Facilitation Mechanism for the implementation of the Sustainable Development Goals was a welcome step. Developing countries, however, continued to bleed more money due to tax evasion than what they received in aid, and international cooperation in tax matters was crucial.
MARIYAM MIDHFA NAEEM (Maldives), speaking in her national capacity and aligning herself with the Group of 77 and the Alliance of Small Island States, said sustainable solutions to end poverty could not be found without addressing climate change. Commitments made with reference to illegal fisheries, clean energy, and disaster risk reduction were encouraging. At the onset of the 2008‑2009 crisis, his country’s tourism-related revenues declined sharply, and the fishing industry had been severely hurt due to climate change. Debt sustainability was a critical issue. Debt relief and sovereign debt management were crucial to poverty eradication. The international community should urgently examine options for an effective, equitable and development-friendly debt restructuring and international debt resolution mechanism.
Ms. KHARASHU (Belarus) said her country attached great significance to international trade to promote economic growth and sustainable development. The international community was currently experiencing severe economic crisis and trade volumes were declining. If that process was not revived, trade volumes would be at their lowest levels since the Second World War. It was important to maintain the significant mandate of UNCTAD as the agency provided a unique database and analytical framework focused on trade and development. Her Government advocated for an action plan of cooperation with middle-income countries, as it believed a whole category of countries had been cast aside and that it was important to engage in trade and development agreements with them. Furthermore, it was clear that the international monetary system needed a reform of its own. There must be urgent effective measures against the imposition of unilateral coercive measures against States. In conclusion, Belarus was keen to join WTO as the last country from the Eurasia region to do so.
DILYARA S. RAVILOVA-BOROVIK (Russian Federation) said her country was troubled by persistent stagnation of the global economy, the low level of investment activity and financial and commodity market volatility. Those challenges imposed budget constraints on countries for financing to attain the Sustainable Development Goals. The Russian Federation urged national Governments to take into account domestic resources when they crafted national sustainable development strategies. That could be achieved by fine-tuning investment legislation, forging public-private partnerships and developing regional banks. Her country closely followed the initiative of Ecuador to adopt a code of conduct for offshore activities. Financing was needed to prioritize projects in the areas of infrastructure, introduction of environmentally clean and energy-saving technologies, development of health care, sanitation and education. Her State intended to work actively under the Economic and Social Council Forum for Financing for Development, which the Addis Ababa Action Agenda had vested with a standalone mandate which was not constrained to the implementation of 2030 Agenda. Her Government was troubled by scant progress in the Doha Round and suggested focusing efforts on areas with the greatest degree of convergence.
INA HAGNININGTYAS KRISNAMURTHI (Indonesia), associating herself with the Group of 77 and ASEAN, said that the lack of resilience in the global economy continued to hurt the international community. It was important to work together to open up new horizons for development to transform economies in a more innovative and sustainable manner. Macroeconomic policies should be predicated on holistic and coherent approaches that promote trade. Development, industrial, social and other policy areas needed to work synergistically to promote structural transformation. Coherent policies addressing finance, investment, technology and entrepreneurship needed to be supported. Despite setbacks in multilateral trade negotiations, revitalizing the multilateral trading system with renewed momentum was necessary. Both public and private finance needed to be aligned with sustainable development. Concrete measures must be taken to adequately allocate resources for long-term sustainable development needs. Investment in critical areas was also needed to address climate change, health, and education and sanitation services.
MARIANNE LOE (Norway) said that with the Addis Ababa Action Agenda, the international community had set the path for moving from “billions to trillions”. ODA continued to be important, but that instrument could only get the international community so far, she said, adding that there was a need for new sources of finance. Attracting investments was crucial, but the competition was tough and domestic resource mobilization would in that regard become decisive. Low-income countries were especially vulnerable to the harmful effects of tax base erosion and profit-sharing, and the issue of illicit flows of capital had become a core development issue. Furthermore, it was worrisome that global growth in trade was lower than the anaemic global economic growth. There was a need to make greater use of trade as a development policy instrument to help integrate the poorest countries into the global economy. In addition, to achieve the Sustainable Development Goals, large infrastructure financing gaps had to be addressed.
GUSTAVO MEZA-CUADRA (Peru), associating with the Group of 77, said it was important to have effective monitoring and review of the commitments made in the Addis Ababa Action Agenda and the 2030 Agenda. Peru had shown in the last 15 years that it was possible to reduce poverty dramatically in a generation, with the poverty rate dropping from half to a quarter of the population. That had been possible thanks to solid macroeconomic management and commitment to the rule of law, as well as the fostering of private investment and increasing openness to trade. Peru had thus been able to mobilize more resources for development, for example, through cash transfer programmes and healthcare services for pregnant women and children. As a result of its efforts, Peru had today become the global leader in eradication of child malnutrition. Nevertheless, systemic constraints continued to exist, and it was necessary to achieve an internationally enabling environment that reduced inequalities between and within countries. Despite being classified as a high middle-income country, Peru still faced structural limitations and was vulnerable to the global economic slowdown, the risks of natural hazards and fluctuations in commodity prices.
YEMDAOGO ERIC TIARE (Burkina Faso) said the global economy was facing major obstacles, such as the fall in commodity prices, increasing instability of exchange rates and severe levels of poverty. It was therefore important to improve the international trade system as it was an important driving force. That included the establishment of a universal trade system which was non-discriminatory. It was also important to reposition the international financial system to address the goals set forward in the 2030 Agenda. He also underscored the importance of making external debt more manageable for States and emphasized the centrality of increased South-South cooperation. To eliminate poverty in all its form by 2030, FDI and ODA must remain at current levels.
TIMOTHY CHARLES YAP (Singapore), associating himself with the Group of 77, the Alliance of Small Island States and ASEAN, said his country took a principled and pragmatic approach to addressing economic volatility. Policies drew on many different intellectual, ideological, and political traditions. Singapore had a currency that floated freely and allowed the country to marry the efficiency of free markets with price stability while also helping to manage domestic interest rates and inflation. However, good policies would not sell themselves and good policy did not always make good politics. Open-ended engagement helped to identify blind sides, bridge ideological divides, and generate conversations on policy trade-offs. To cement trust, policy must ultimately be effectively implemented. Principled pragmatism, engagement, and effective implementation continued to be the three factors that helped Singapore address economic challenges.
EMMANUEL KAUNDA (Zambia) said that the weak global economy negatively impacted commodity exporting economies. As a trade dependent country, Zambia’s economy had not been spared, with reduced foreign exchange earnings exerting pressure on the exchange rate and affecting the budget. Other domestic pressures included electricity supply constraints and fiscal pressures coupled with continued current account deficits that had affected macroeconomic stability. Zambia called on its development partners to support its efforts to insulate itself from vulnerability to external shocks. Zambia took debt sustainability very seriously and had undertaken prudent debt management strategies.
PHILIP FOX-DRUMMOND GOUGH (Brazil), associating himself with the Group of 77, CELAC and the Cairns Group, said that trade stood prominently as a key means of implementation to effectively promote structural change and inclusive and sustained economic growth. Brazil was deeply concerned at the continuation of a multilateral trading system heavily distorted to the detriment of agriculture and therefore to the detriment of development. It was necessary to intensify efforts to fight protectionism in all its forms. Tariff barriers needed to be brought to light to expose the harm they caused to developing countries. Agricultural export subsidies, meant to be eliminated in 2013, had long extended their envisaged existence. Non-tariff protections, such as technical barriers and sanitary and phytosanitary measures, needed to be applied in accordance with multilaterally agreed standards and with a solid scientific basis. To enable each country to take ownership of its economic and social development, it was necessary to have an international environment that included coherent and mutually supporting world trade.