Deputy Secretary-General, at Caribbean Community Pledging Event, Calls for Sustained Finance, Debt Relief Tailored to Disaster-Prone Region

21 November 2017

Deputy Secretary-General, at Caribbean Community Pledging Event, Calls for Sustained Finance, Debt Relief Tailored to Disaster-Prone Region

Following is UN Deputy Secretary‑General Amina Mohammed’s keynote address to the pledging segment of the Caribbean Community (CARICOM) High‑Level Donor Pledging Conference, in New York today:

I am pleased to see so many of us here to partner with the Caribbean for a more sustainable future.  Today is the day.  This is the day for us all to translate our solidarity and support into concrete commitments to drive the early recovery of the Caribbean islands impacted by hurricanes Irma and Maria and invest, together with these countries, in building their resilience to withstand future extreme climate events and other external shocks and stay on a path to sustainable development.

The needs are enormous; and they are exceeded by the ambition to build back better, achieve the Sustainable Development Goals and secure a stable and prosperous future for their citizens.  We heard the words of the Prime Ministers earlier this morning.

Your pledges today will be crucial for the recovery of the region.  This financing is very much needed and will complement ongoing domestic efforts.  Early disbursement and predictable and sustained co‑investments are essential as recovery is a long‑term process.

We know that dramatic disasters like these often lead to a ‘spike’ in responses.  This time, as development partners, we must maintain focus.  We cannot afford to lose interest until the next big disaster.  Sustained finance, better aligned to the reality of small islands States with high vulnerability to climate change, is necessary to build resilience in the region.

Colleagues in the previous session have emphasized this point.  Recently, I have myself repeatedly highlighted the importance of a framework for action in aligning finance with the needs of resilience.  And we need to act now, this finance is needed today, not in five or 10 years.

Many of the small island states in the Caribbean are not eligible for concessional finance or official development assistance (ODA).  Efforts to find ‘creative’ ways to extend concessional resources to these countries on an exceptional basis are welcome.

I am pleased that the United Nations Development Programme (UNDP), the World Bank and other international organizations, such as the Commonwealth Secretariat, Caribbean Development Bank, the Organisation for Economic Cooperation and Development (OECD) and others, are looking at how vulnerability may be used to help determine eligibility for concessional finance.  We encourage this work to move from concern, dialogue and technical analysis to practical changes in this area so that pleading for exceptions will not be path these countries will need to continue to pursue in the future.

But new rules governing access to concessionary financing cannot be the whole solution to what is a systemic threat.  We know that disasters such as these will happen again and again in the Caribbean, and increasingly elsewhere.

To deal with such a systemic threat, the international community needs to put in place long‑term concessionary financing facilities, employing a mix of instruments.  For example, in Bonn last week at COP23 [Twenty‑third session of the Conference of the Parties to the United Nations Framework Convention on Climate Change], InsuResilience initiative announced a new global partnership and an additional $125 million from the Government of Germany to support its aim of providing affordable insurance coverage to 400 million more poor and vulnerable people by 2020.  Robust and affordable insurance is key, but again only part of the solution.

Debt relief is also essential.  High debt levels are a persistent and unresolved problem for many Caribbean countries with cases of debt levels averaging 84 per cent of gross domestic product (GDP), in part because of debt raised to overcome the impacts of earlier natural disasters.  Amidst the tragedy for many Caribbean citizens, the region continues to service its debt.

There are multiple ways to go about addressing the problem of high indebtedness.  Debt payments held by official bodies can be postponed or cancelled, as we saw recently for countries facing the effects of Ebola.

Innovative proposals such as the Economic Commission for Latin America and the Caribbean (ECLAC) and UNDP’s proposal for converting debt into financing for resilience need to be transformed from great ideas into practice.  We invite the international community to work with the United Nations to operationalize these ideas.

While we improve the international financing architecture to make it more supportive of small vulnerable countries, we also need to implement and scale‑up innovations in finance that could be useful for the Caribbean and, as a matter of fact, also other small island developing States facing similar issues.

Innovations could include:  Use of blue and green bonds for investments in sustainable infrastructure and a sustainable ocean economy; use of so‑called ‘state‑contingent’ debt instruments, such as hurricane clauses and countercyclical loan instruments to reduce the risks of debt crises and create temporary fiscal space in countries affected by major disasters; and accelerating a reduction in the cost of transfer of remittances and strategies to support diaspora communities to invest ‘back home’.

Ultimately, finance is a means to an end.  The end is resilience, of countries and of their people.  In the context of the Caribbean, this means climate resilient infrastructure, diversified economies and livelihoods, sustainable natural resources management and sustainable energy systems.

For example, maybe there has never been a better moment to green the region’s energy systems, and to strengthen its resilience through decentralization, using distributed solar linked to the best that digital innovation can offer.  We are pleased that this will be a key topic for discussion at the forthcoming summit on climate and finance co‑hosted by President Macron, the United Nations, and the World Bank in December.

In essence, we must rebuild differently.  We must rebuild better if the region wants to achieve the commitments of the Agenda 2030 [for Sustainable Development].

No single agency can deliver all this and partnerships will be key.  The partnership with the private sector will be particularly important and we are pleased that many of its representatives are here today and have shown such an interest in working with the authorities in Caribbean countries and with development partners.

Let me conclude by saying that hurricanes Irma and Maria have not only caused death and destruction; they have also revealed, once again, the enormous number of individuals with giving hearts in the region and beyond.  There has been an outpouring of solidarity from neighbouring countries, the diaspora and the international community.  I am sure that this conference will confirm this sentiment.

For information media. Not an official record.