Sommaire: EU Presidency Statement - Macroeconomic policy questions and follow-up to Financing for Development (9 October 2006: New York)
Statement by Mr. Jarl-Håkan Rosengren, Minister Counsellor, Permanent Mission of Finland to the United Nations, on behalf of the European Union, 61st Session of the GA; Second Committee, Agenda Items 51 and 52: Macroeconomic policy questions and follow-up to and implementation of the outcome of the International Conference on Financing for Development, New York
Madam Chair,
I have the honor to speak on behalf of the European Union.
The Acceding Countries Bulgaria and Romania, the Candidate Countries Turkey, Croatia* and the former Yugoslav Republic of Macedonia*, the Countries of the Stabilisation and Association Process and potential candidates Albania, Bosnia and Herzegovina, Montenegro, Serbia, as well as Ukraine and the Republic of Moldova align themselves with this declaration.
In this speech, remarks will be given based on the themes covered by agenda items 51 and 52, that is, Macroeconomic policy questions and Follow-up to and implementation of the outcome of the International Conference on Financing for Development. Consequently, we will also make brief remarks on trade, but the EU will address trade issues in more detail in the debate on 17 October. The EU would like to thank the Secretary-General for the report "Follow-up to and implementation of the outcome of
the International Conference on Financing for Development".
Madam Chair,
The main thrust of Monterrey Consensus on Financing for Development continues to be valid, and it emphasizes the shared responsibility for development as a framework for our work to achieve the internationally agreed development goals and objectives including the Millennium Development Goals. As agreed in the Monterrey Consensus, each country has primary responsibility for its own economic and social development. These national efforts need to be supported by the international community.
The European Union remains fully committed to the global partnership for development set out in the Millennium Declaration, the Monterrey Consensus and the Johannesburg Plan of Implementation, and reaffirmed at the World Summit last year. The effective implementation of this global partnership is key to the attainment of our common goals for development and we call for action by all partners to play their part.
During this year, follow-up to and implementation of the outcome of the International Conference on Financing for Development has been considered at several occasions. At the April high-level meeting of ECOSOC, the Bretton Woods Institutions, WTO and UNCTAD, the theme of coherence, coordination and cooperation in this regard was discussed, taking also into account the 2005 World Summit Outcome. In addition, during the Substantive Session of ECOSOC in Geneva, the High-Level Policy Dialogue took
place with the same major stakeholders. The EU also looks forward to the next High-Level Dialogue of the General Assembly, which is due to take place in 2007. These opportunities have an important role in enhancing the global partnership in the spirit of Monterrey Consensus and in fostering exchange of views among key stakeholders.
Madam Chair,
In recent years, the world economy has experienced strong growth, and this trend is expected to continue next year. Very positive developments have taken place in the world economy, and millions of people have been lifted out of poverty at the global level during the last few years. However, the challenges of equity and sustainable development still remain of key importance, as well as maintaining macroeconomic stability, improving public sector financial management, and strengthening domestic
resource mobilization, business climate and governance. In order to achieve the internationally agreed development goals and objectives including the Millennium Development Goals, we need further joint action and increased efforts on all sides.
In today's world economy, development challenges can only be tackled by governments, private sector and civil society with a strong strategic vision. In this regard, the EU welcomes the fact that a growing number of countries adopt and continue to improve their PRSPs, thus providing a comprehensive and results-oriented framework for the development efforts of all actors. Promoting economic growth based on the dynamism provided by a vigorous private sector is essential, but not sufficient to
ensure sustainable social and economic development. If economic growth is to be of lasting benefit, it must be underpinned by a sustainable environment. The EU welcomes the ongoing consultations by the IMF to address global imbalances, supporting policies to reduce them while sustaining global growth.
The benefits of growth are extended to the entire population only by addressing the challenge of extreme inequalities in terms of incomes and income distribution, safe access to productive resources such as land, access to health, education, employment and other opportunities. People with limited resources, along with the rest of the economy, should be the drivers of growth, not passive recipients. To this end, having a productive job is a fundamental prerequisite that can empower poor people
and reduce income poverty. Equity and social cohesion are essential elements in the pursuit of long-term prosperity. The promotion of equality between men and women must be an integral part of these efforts.
Madam Chair,
Sound national policies, poverty reduction and development strategies, as well as good governance are essential for achieving sustainable development. MDGs should be fully integrated into comprehensive PRSPs and other national development plans. In line with the European Consensus on Development, the EU is strengthening its mechanisms and partnerships to support good governance, both nationally and internationally. The EU stresses the importance of broad definition of good governance as
including, not only the fight against corruption, but also the respect for human rights, adherence to democratic principles and the rule of law as well as sound economic, financial, social and environmental management. In this vein, the EU welcomes the undergoing discussion in the World Bank on the strategy aiming at increased focus on governance, in the framework of the fight against poverty.
Madam Chair,
In terms of aid policies, the EU has adopted a timetable for its Member States to achieve 0.7% of GNI by 2015, with an intermediate collective target of 0.56% by 2010, and calls on partners to follow this lead. Together, the member states of the EU and the European Community are the biggest net ODA provider to developing countries, and especially to least developed countries. In 2004, 50 % of the EU member states' total bilateral ODA went to LDCs. The current trends indicate that the EU's share
will even be larger in the future. In this regard, the EU recognizes the challenges of development especially in Sub-Saharan Africa and has committed to provide 50 % out of the aid increases to Africa.
The EU is very attentive to the quality of aid. Major commitments for a more harmonized, aligned and result based development policy have been made by the larger development community in the Paris Declaration on Aid Effectiveness - which was adopted in March 2005 and to which we are fully committed. The "European Consensus for Development" sets the principles for increased aid effectiveness and coherence through better donor coordination, harmonization, complementarity and delegation of work.
The whole multilateral system and all multilateral institutions, including the entire UN development system, BWI's, WTO, OECD/DAC as well as regional organizations must live up to their responsibility and continue their efforts to make aid more effecient and coherent. The Paris Declaration should be seen as a compact between donors and recipients on the governance of ODA, involving commitments of both sides. It can only succeed if both sides live up to their commitments.
The World Summit recognized the value of developing innovative sources of financing, and various initiatives are being implemented, in which EU member states play a leading role. The EU welcomes innovative sources of financing introduced and supported on a voluntary basis by Member States, especially those health initiatives already under implementation, such as the International Financial Facility for Immunisation and UNITAID, the new drug purchase facility, or envisaged, such as Advanced
Market Commitments for new vaccines, and the International Finance Facility and transaction levy, by some Member States. These initiatives are implemented with a view to mobilize predictable and increased stable sources of finance. Initiatives for innovative finance mechanisms should be undertaken in accordance with the principles for aid effectiveness established in the Paris Declaration and be based on existing mechanisms for aid delivery to the extent possible.
Madam Chair,
The EU remains fully committed to the Doha Development Agenda. It remains the central priority of our trade policy, and the EU deeply regrets the suspension of the Doha Development Agenda earlier this year. We remain committed to the case for open markets, progressive trade liberalization, and stronger multilateral rules, as a trigger for growth and development. In this spirit, we need to look ahead and to rebuild. The offers that are already on the table must be retained and comparable offers
be made. All Members must be ready to restart the negotiation from that basis as soon as circumstances allow. For its part, the EU is committed to a result that would deliver real cuts in tariffs, effective cuts in subsidies and real new trade flows, as part of a deal that should bring benefits to all WTO members. We would further ensure that the Doha round really brings benefit to the poorest countries, in consistency with its development focus.
In this regard the EU emphasises that Aid for Trade remains on the agenda, independently from the future of the Doha negotiations. The EU acknowledges the importance of Aid for Trade assistance, which is firmly grounded in national development strategies, as an instrument contributing to a fuller integration of developing countries into the multilateral trading system and providing them with increased trade opportunities as a way to enhance growth prospects and reduce poverty. The EU welcomes
the reports of the taskforces on the Integrated Framework and on Aid for Trade. The EU is committed to work with partners in the WTO, and in particular with beneficiary countries, to implement recommendations of the reports.
South-south trade is an increasingly important element of world trade and provides new opportunities for development. In addition, the EU welcomes the General Assembly's continued attention to the question of commodities, which is of key importance to developing countries. It is encouraging that the stability of commodity prices has improved, and there has even been a continued positive trend in the prices in real terms. From the side of the EU, important efforts have been undertaken in the
context of the EU Action Plan on commodities and the specific EU - Africa partnership on cotton.
Madam Chair,
The EU is a supporter and financier of the Heavily Indebted Poor Countries initiative. The EU welcomes and supports the work on the implementation of the Multilateral Debt Relief Initiative, which rests on the two pillars of deepening debt relief to HIPCs and of safeguarding the long-term financial capacity of the international financial institutions. The EU welcomes the debt relief, which has provided many low-income countries with additional resources for the attainment of the MDGs. While
recognizing the financing needs of developing countries to reach the MDGs, it is important for countries to take a prudent approach to new borrowing, and new resources to be provided on appropriately concessional terms so as not to lead to a renewal of unsustainable debt burdens. The EU welcomes the current discussions on strengthening the debt sustainability framework.
Madam Chair,
As it is expressed in the Monterrey Consensus, foreign direct investment is an important complement to domestic investments, not forgetting other national and international development efforts. The EU welcomes recent developments in FDI flows from middle-income countries to other developing countries. The EU would like to reiterate that in order to ensure continued and strengthened flows of sustainable foreign direct investments, the efforts need to continue, to achieve transparent, stable and
predictable investment climates. The EU welcomes public-private partnerships and other mechanisms in this regard and encourages efforts towards good corporate governance and citizenship.
While the EU believes that migrant remittances can be an important financial contribution to development as a complement to other sources, we recognize that the remittances are private resources and should not be a substitute for Official Development Assistance. There is a need to address and to promote conditions for cheaper and safer transfer of remittances in both source and recipient countries, and to facilitate the impact on the development of recipient countries through an enabling policy
and institutional environment. The EU welcomes efforts by governments and stakeholders in this regard.
In reference to the recent annual meeting of the Bretton Wood Institutions in Singapore, the EU supports the resolution on quotas and voice in the IMF. We believe the two main goals are to ensure that the distribution of quotas adequately reflects the member countries' economic weight and role in the global economy and financial system and their ability to contribute financially, as well as strengthening the voice of low-income countries in the IMF. The EU remains committed to ensuring the
effective participation of developing countries and countries with economies in transition in the International Financial Institutions.
Madam Chair,
The EU looks forward to the discussions in the 2nd committee on further review of Monterrey Consensus. Last year, the General Assembly decided, in resolution 60/188, to hold a follow-up international conference on financing for development at a time between 2008 and 2009 to review the implementation of the Monterrey Consensus. The EU looks forward to a resolution on Financing for Development, including timing and other modalities of the follow-up conference. However, the existing mechanisms as
spelled out in the resolution continue to be a major part of reviewing implementation of the Consensus.
Madam Chair,
On these issues, we look forward to further discussions with partners during the coming weeks.
Thank you.
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