Leading women economists from around the world converged virtually at the United Nations earlier this month to address the global economic fallout of the COVID-19 crisis and offer people-centred solutions for achieving meaningful, lasting and transformative progress.
The roundtable, convened by United Nations Secretary-General António Guterres, is the first in a series on “Rebirthing the Global Economy to Deliver Sustainable Development.” Addressing participants, the Secretary-General called the pandemic “the first development emergency that I remember,” calling for “concrete, radical and implementable solutions.”
The event was moderated by BBC journalist Zeinab Badawi, who called on participants to “reimagine, rebuild and rethink how we can build back better through the lens of inclusion and sustainability.” Co-convenor Sri Mulyani Indrawati, Indonesia’s Minister of Finance, stressed that “this pandemic is attacking the 3 Ps – people, prosperity and partnerships. Many countries are going to lose the progress they made in reducing poverty in the past two to three decades.”
Speakers included Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), Christine Lagarde, President of the European Central Bank, and senior representatives from leading academic institutions, the World Bank and IMF. Together they discussed a wide range of issues related to three main topics – finance, debt and trade.
On finance, many agreed that there was no lack of financing and called instead for increased conditionalities on bailouts and investments to achieve industrial transformations. In particular, investments should empower people and go into improving health, education and skills and creating jobs to build a more sustainable future. Finance should also help close the digital gap as a more efficient way of delivering services and transforming economies. Financial models also need to align better with human needs and planet protection: in the words of one participant, “finance is currently in service to itself. It must be put in service to humanity and a thriving planet.”
Regarding debt, a moratorium and debt relief mechanisms would be the quickest ways to enable vulnerable countries to respond to the crisis. However, several speakers also agreed on the need to free developing countries from the vicious cycle of desperate dependence on external aid, which is exacerbated by the need to service ever-increasing debt. One speaker also urged the discussion to be broadened to include ecological debt, owed by developed countries to developing ones which no longer have the ecological foundation upon which to build their own wealth.
As for trade, protectionist policies prevent trade from benefiting all involved. Trade should be at the service of those at the bottom of the ladder of countries. It will only be beneficial if global value chains are rewired so the middleman is cut out and added value can be retained in countries where it is most needed.
Ngozi Okonjo-Iweala, the African Union Special Envoy to Mobilize International Economic Support for Continental Fight Against COVID-19, pointed out that if countries on the continent could be freed of debt, they would have $44 billion more in their hands to use to buy medical supplies and emerge stronger from economic stress. Alicia Bárcena, Executive Secretary of the United Nations Economic Commission for Latin America and the Caribbean (ECLAC), supported “good conditionality, not austerity conditionality. We are not going to get out of this with austerity; we need a new trade environment,” she explained.
The next roundtable, featuring a number of young women economists, will be held in September. Meanwhile, recommendations from this Roundtable will inform the financing for development discussion groups working on policy options to be considered by Ministers of Finance and Heads of Government later this September.
The Deputy Secretary-General, Amina J. Mohammed, said the absence of a model to respond to this unprecedented crisis, a new paradigm is needed that puts people and planet front and centre. “Let us not repeat the same outdated theories that let the poor and vulnerable drown,” she said. “I am confident that we are crafting the solutions we need to build back a stronger, more resilient, more equal, inclusive and sustainable world as overcome the COVID-19 crisis and achieve the SDGs,” she concluded.