Delegates applaud the adoption of the Outcomes Document. Photo: Shari Nijman (Creative Commons)
World conference on funding development: much ado about little
The Third International Conference for Financing for Development ended on 16 July in Ethiopia’s capital with the Addis Ababa Action Agenda (AAAA). The four-day event was organised by the UN in collaboration with the World Bank, IMF and developed and developing nations. It had, according to the blurb, the triple objective of following up on commitments made in Monterrey (2002) and Doha (2008); strengthening the framework to finance sustainable development and the means of implementation of the post-2015 development agenda; and of ensuring the implementation and review of agreed action “in an appropriate, inclusive, timely and transparent manner.”
The international trade union movement kept tabs on developments leading up to the event. Moreover, the International Trade Union Confederation (ITUC), of which the TUC is an affiliate, took part in a series of events organised by civil society to mobilise support for the trade union position on a number of themes of global importance, notably, decent work, social protection, gender equality, quality public services, reduction of inequalities between and within nations etc. It is, therefore, worth having a brief look at the achievements of the last week’s gathering.
Sadly, in our view, FFD3 has not been any more successful than its two predecessors in securing finances for development in terms of specific pledges or concrete action. The outcome document revisits the familiar territory – trade, investment, remittances, revenue from taxation, Official Development Assistance – emphasizes their role in sustainable development and enumerates a plethora of “commitments” by heads of state and government and high representatives. Of course, there is hardly any fundamental disagreement over the importance of ways and means of financing sustainable development. Nevertheless, the outcomes fell far short of expectations:
- FFD3 decided to provide more resources for the UN Committee of Experts on International Cooperation on Tax Matters, but, unfortunately, failed to agree on the creation of a UN supervisory mechanism on tax matters, much to the disappointment of developing nations (para 29).
- For all the incessant talk about innovative financing, FFD3 eschewed any purposeful discussion on the implementation of a financial transaction tax/Robin Hood Tax as an additional source of financing for development.
- FFD3 placed excessive faith in the role of private finance in sustainable development, especially, in its reliance on public private partnerships (PPPs) without recommending appropriate, adequate, specific and binding safeguards including strict compliance with internationally recognized core labour standards and/or environmental standards.
- There was no time-bound pledge by any donor to increase ODA towards the UN-recommended 0.7% of GNI except for the re-affirmation of the collective commitment by the EU within the time frame of the post-2015 development agenda (para 51).
- It skirted round thorny issues regarding trade and investment and failed to address a host of issues such as commodity dependence, subsidies, trade restrictions, distortions etc (Section D).
- FFD3 did not address the unsustainable debt burden of developing countries including that of Middle Income Countries in a satisfactory way, other than inviting the IMF and the World Bank to strengthen their analytical tools for sovereign debt management (Section E).
- It missed a valuable opportunity to recommend a substantial and permanent addition to international reserves through a one-off allocation of Special Drawing Rights (SDRs) to facilitate the implementation of the post-2015 development agenda. It merely looked forward to the quinquennial review (para 107).
- There wasn’t any progress on economic governance issues, notably, on reforms to the IMF and World Bank.
- There was no tangible progress on funding for the protection of the environment including dealing with the consequences of climate change.
Perhaps there is some comfort in the fact that FFD3 did make reference to some concerns expressed by the international trade union movement on social protection and essential public services:
“…In this effort, we will provide fiscally sustainable and nationally appropriate social protection systems and measures for all, including floors, with a focus on those furthest below the poverty line and the vulnerable, persons with disabilities, indigenous persons, children, youth and older persons.. We also encourage countries to consider setting nationally appropriate spending targets for quality investments in essential public services for all, including health, education, energy, water and sanitation, consistent with national sustainable development strategies. We will make every effort to meet the needs of all communities through delivering high-quality services that make effective use of resources.” (para 12)
“To enable all people to benefit from growth, we will include full and productive employment and decent work for all as a central objective in our national development strategies.….. We also commit to developing and operationalizing, by 2020, a global strategy for youth employment and implementing the International Labour Organization (ILO) Global Jobs Pact”. (para16)
All in all, it was much ado about little progress on financing for development.