Today’s event addresses one of the most important issues facing the Least Developed Countries, at a critical time.
As the pandemic continues to rage in many developing countries, and more deadly and contagious variants of the virus continue to emerge, the impact on the economies of the LDCs has been devastating.
The effects of COVID-19 are expected to lead to a significant decline in government and export revenues in most LDCs, both in absolute terms and as a share of Gross Domestic Product.
The debt situation has worsened, remittances have declined, while flows of Foreign Direct Investment have decreased significantly.
Official Development Aid remains under pressure as the donor countries themselves struggle with their own economic woes.
And the recovery in Least Developed Countries is expected to be slower than in other countries owing to their structural vulnerabilities.
Most will likely take several years to reach the level of GDP per capita they had in 2019 – and for some possibly five years or more.
All of this is compounded by intensifying climate impacts such as extreme weather events, which cripple communities and impede development.
Yet opportunity lies within this situation of multiple and cascading crises.
First and foremost, the pandemic must be stopped. For this, vaccines must be made available to all countries in need. We must close the funding gap of the COVAX Facility too.
Second, we must build on progress in addressing the unsustainable debt situation in lower- and middle-income countries.
The G20’s Debt Service Suspension Initiative must be extended into 2022 and be made available to all highly indebted countries – all of them.
But there also needs to be real debt relief. The Common Framework must be complemented with initiatives and instruments so that participating countries are not penalized with downgrades to their credit ratings.
I welcome the broad support among members of the International Monetary Fund for a new allocation of Special Drawing Rights of $650 billion US dollars, and for a reallocation of SDRs to support vulnerable and low-income countries.
Third, we must ensure that the goal to mobilize $100 billion US dollars in climate finance annually for developing countries is met or exceeded before this year’s United Nations Climate Conference, COP26.
This is a matter of basic trust. The Least Developed Countries are in the frontline of climate change. I reiterate my call to the developed nations – as well as to international financial institutions and national development banks -- to urgently allocate 50 per cent of total climate finance to adaptation and resilience. The share of grant-based and highly concessional finance needs to be doubled.
Fourth, I reiterate my call on governments to consider a solidarity or wealth tax on those who have profited during the pandemic, to reduce extreme inequalities.
Reports indicate that there has been a $5 trillion US dollars surge in the wealth of the world’s richest people in the past year. At the same time, the pandemic has pushed 120 million people back into extreme poverty, many of them in Least Developed Countries. We must find ways of redressing the balance.
Fifth and finally, the UN Conference for Least Developed Countries, to be held in January, offers a chance to recover precious ground on the Sustainable Development Goals that has been lost to the pandemic.
The world’s leaders will adopt the new 10-year Programme for Action for LDCs.
This outcome must be bold, including on mobilizing finance for development from all sources.
We must strengthen domestic resource mobilization of Least Developed Countries too and close international tax loopholes.
We must reverse the decline in Official Development Assistance and step up South-South and triangular cooperation.
We must put in place the incentives to reverse the decline in Foreign Direct Investment and ensure that long-term private international capital flows promote sustainable, risk-informed, resilient and inclusive economies.
The negotiating process is under way.
The stakes are high.
I encourage all Member States to seize this opportunity to build a better, more equitable, more sustainable and more resilient world not only for the Least Developed Countries but for all.