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High Level Thematic Debate on Means of Implementation

Statement by Mr. Mukhisa Kituyi, Secretary General

High Level Thematic Debate on Means of Implementation

New York
09 February 2015

[AS PREPARED FOR DELIVERY]

Excellencies,
Ladies and Gentlemen,

For the last fifteen years, countries have been endeavoring to achieve the Millennium Development Goals. At UNCTAD we have supported these efforts, offering member States tools to harness the global economy for the benefit of their development. We have tried to offer a needed policy framework for achieveing the MDGs, because such a framework was missing from the goals themselves, despite the general language of MDG Goal 8.

We welcome the greater ambition of the Sustainable Development Goals. Specifically, the focus on Means of Implementation aims to make the needed policy framework more explicit this time around. Through the M-o-I discussion and the F-f-D process we at UNCTAD today are focusing our energies on how to "Make the SDGs Work" for countries.

Achieving an ambitious and transformative agenda requires equally ambitious actions. Consider the scale of the challenge, particularly for the LDCs. The share of poor people living in China in 1994 was about the same as the share of poor people living in LDCs today - approximately 46% of the population living on less than $1.25 per day. For 15 years, China grew on average at 9.4% per capita growth per year, and yet in 2009 nearly 12% of China's population was still living in poverty. To end poverty 15 years from now by 2030, as the SDGs envision, the LDCs will require a much bigger economic miracle than China's.

This is not unattainable - but it is a sizable challenge, especially considering that less buoyant external economic environment since the global economic crisis. Exports had been growing at twice the rate of growth of the economy before the crisis - today exports and the economy as a whole are both growing at the same, slow speed.

At UNCTAD we believe that trade, finance, technology, & investment can support global demand and sustainable development only if they work together in an integrated manner through a fair and open multilateral trading system, and a well-functioning international financial architecture. Unfortunately, especially in the period since the Great Recession, neither the trading system, nor the financial architecture have been functioning particularly well.

Reinforcing the primacy of the multilateral trading system should be a priority for implementing the SDGs. The recent validation of the WTO Agreement on Trade Facilitation is an important step forward, but many countries are already taking their trade interests to other venues outside the multilateral system. Plurilateral and regional arrangements are not necessarily a bad thing - especially when they take development objectives explicitly into account. But when they exclude the countries and regions that need external markets the most - such as LDCs and other vulnerable economies - we must ask ourselves how we can refocus the development orientation of the trade agenda. This will require a successful conclusion of the Doha round at the 10th WTO Ministerial Conference to be held in Nairobi, Kenya this December. But outside the WTO, this will also require greater technical support to country's trade integration efforts as a part of their development strategies, whether through support to trade facilitation, trade diversification, measuring non-tariff barriers, or improving collection of trade-related revenues.

Finance - through debt and investment - will be the cornerstone of mobilizing funds for sustainable development, and channeling funds to needed projects. We all agree that there is increased need for private sector engagement. But that should not relieve governments of their commitments and their accountability to their constituents. To finance the often sensitive SDG sectors, we need to balance liberalization with the right to regulate and we need to balance the need for attractive rates of return with the need for accessible, affordable services. But we must also balance the global scope of the SDGs with the very specific needs of different countries, whether they are LDCs, LLDCs, SIDS, or even middle-income countries.

A key element of the post-2015 financial architecture should be more sustainable governance of international investment. The current patchwork of International Investment Agreements offers uneven treatment to investors and investment destinations. More sustainable investment dispute mechanisms embedded in these treaties would respect the sovereignty of individual states and their legal systems.

Another success of the MDGs was the debt relief achieved under the Multilateral Debt Relief Initiative in 2005, based on an UNCTAD proposal from decades before. This great success threatens to be undone if better financing options and better debt workout mechanisms are not found at the multilateral level.

In recent years, a startling number of lower middle-income countries, including many in Africa, have returned to borrow from the financial markets - not through the existing concessional lenders, like the World Bank or the African Development Fund- but through issuing sovereign bonds at much higher rates of interest from the private market. This indeed is a sign of these countries taking control of their own destinies, and should be supported - however it also raises a challenge to the international community. Existing lending options are clearly not meeting country needs and there is risk that external shocks may lead to future debt crises. Discussions of a more sustainable multilateral sovereign debt workout mechanism are right now underway and UNCTAD is pleased to be servicing the Ad Hoc committee of the GA set up to this effect. But we also feel that a broader discussion is needed and should be ongoing in the context of implementing the SDGs and in the FFD process.

Finally, allow me to reiterate UNCTAD's ongoing support to many Member States in providing capacity building and finding innovative technological solutions for the challenges they face in integrating the global economic system. We are helping many countries put in place the "software" they need to build needed infrastructure and to strengthen regional cooperation. Whether through our support to trade facilitation implementation, or our Train for Trade and Port management programmes, or ASYCUDA customs automation systems and DMFAS debt management systems, we employ a wide range of technical cooperation initiatives to deliver results to Member States on the ground.

To help guide these initiatives and integrate them in a holistic manner across sectors and dimensions of sustainable development, we look to the SDG negotiations for a strong political statement on the importance and role of technical cooperation in helping countries take the financing of sustainable development into their own hands.

Tomorrow I invite all of you to discuss these issues in more detail with me at a lunchtime event immediately following the High Level Thematic Debate. We will try to dig a little deeper into the lessons learned from UNCTAD's toolkit for helping countries harness the global economy to their benefit, and how these lessons can help make the SDGs work for all countries.

Thank you.