Addis Ababa, Ethiopia – 15 July, 2015

Honourable Alexander Chikwanda, Minister of Finance of Zambia, and Chair of the Group of Landlocked Developing Countries,

Honourable Ministers,

Mr. Gyan Chandra Acharya, High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States,

Excellencies

Ladies and gentlemen

I am pleased to address this meeting focused on addressing important issues affecting landlocked developing countries, with particular emphasis on “financing for infrastructure development and regional integration.”

Last November in Vienna, we adopted the Vienna Programme of Action. In doing so, we resolved to renew and strengthen the international community’s commitment to addressing the special needs of landlocked developing countries. Most of these countries are also least developed. The lack of access to the sea, and remoteness from world markets compounds their challenges, including high trade and transportation costs, which reduce their competitiveness.

We agreed in Vienna, inter alia, to develop adequate transit transport infrastructure networks across LLDCs; and effectively implement bilateral, regional and international legal instruments and strengthen regional integration.

It is therefore timely that this Event, in the context of financing for development, focuses on these two important priorities. We should spare no effort to ensure that concrete results in infrastructure development are achieved on the ground, especially at national and regional levels.

Excellencies,

The draft outcome of the Third Financing for Development Conference to be adopted later this week, recognizes the urgent need to bridge the infrastructure gap, through increased investments and access to long-term financing at concessional and affordable rates.

In this regard, developing secure, reliable, seamless and efficient transit transport systems is critical for cheaper and faster access of LLDCs to seaports and international markets. Concurrently, we should also ensure that other critical infrastructure, such as energy and ICT is in place, to improve competitiveness and connectivity to global markets.

Harnessing the full potential of inter- and intra-regional trade remains critical. While access to global markets, through a fair and transparent trading regime is important, full development of national and regional markets is a more sustainable way of supporting growth and development.

In this context, greater efforts should be made to enhance and deepen regional integration to expand markets and address all tariff and non-tariff barriers to trade.

Excellencies,

At the LLDCs meeting last month in Livingstone, Zambia, it was agreed that annual investments for infrastructure from all sources should be doubled. The question is, how can the needed additional resources for infrastructure development in LLDCs be raised?

The draft outcome of the Third FfD Conference contains key actions and measures in support of LLDCs, particularly on infrastructure development, foreign direct investment, trade, debt sustainability and capacity building. Once adopted, it will be important that all actors at the national, regional and international levels play their respective roles to effectively implement it.

Going forward, it will also be critical to ensure that the special needs of LLDCs, whose combined population is 450 million people, are fully incorporated into the Post-2015 Development Agenda. We need stronger partnerships, with sustained cooperation from bilateral, regional and international partners.

Excellencies,

With regard to our focus today, I consider the following as some of the ways to raise increased funding for infrastructure.

  1. First, Official Development Assistance (ODA) remains critical, and should be leveraged, as appropriate, to attract additional financing for infrastructure development, to make loans more affordable for many LLDCs. Aid for Trade should also be enhanced to support increased domestic resource mobilization;
  2. LLDCs should diversify and transform their economies. Industrialization, agro-processing and value addition to natural resources will improve domestic revenue to support growth. There is need for targeted long-term concessional loans for critical infrastructure, especially energy and transport;
  3. Third, strengthening cooperation at bilateral and regional level should be enhanced, including through pooling of resources especially for cross-border infrastructure projects;
  4. Fourth, with the private sector contributing over 70% of GDP in many LLDCs, its participation must be enhanced. Public-private partnerships, including through instruments like infrastructure bonds must be enhanced. Governments should provide an enabling environment for businesses to flourish; and
  5. Fifth, we need to tap into all existing financial resources, including non-traditional sources such as capital markets, pension funds and sovereign wealth funds.

I thank you for your kind attention.