Third South Summit

Excellencies,

Heads of State and Government of the G77 and China,

Distinguished delegates,

Dear friends,

It is a great honour for UNCTAD to be present in this Third South Summit, 60 years after the creation of the G77 and China.  – UNCTAD was  born in the same year, the same place, and with the same purpose. So, it is a joy and a calling to celebrate our joint 60th anniversary, here in Kampala, Uganda.

At the outset, I would like to congratulate the Member States of the G77 and China for this successful Summit. I also want to express my appreciation to the Government of Cuba for their very successful chairmanship and the Government of Uganda for their able leadership and touching hospitality. And I especially want to thank President Museveni for his speech yesterday where he referred very warmly to the first session of UNCTAD in 1964 as the ‘first organized effort by developing countries to unite, to steer their countries on the path of economic development, in the unjust world economic order’. To that, President Museveni added, referring to the present moment 60 years later, and I quote:

“We meet at the time, where the developing Countries continue to face multiple global challenges that undermine our national and collective efforts to achieve sustainable development.”

This statement encapsulates the crux of our gathering here today. On the one hand we have, as we have often heard these days in Kampala, the indisputable truth that the Global South is now a much stronger force than it was 60 years ago. The Global South now represents around 58 percent of all world’s economic output (in purchasing power parity) and South-South trade represents about a third of all trade. For many years poverty and the Human development index improved achieving important milestones.

But we have, on the other hand, what many of you so clearly mentioned in your statements. The Sustainable Development Agenda is about leaving no one behind; and yet, in the metrics that matter most, the South is being left behind.

The South is being left behind by an international order that is still  unjust: an order where those who did the least to cause climate change are the ones who pay the most for it; an order where vaccines are not shared during a pandemic; an order where divides widen with each technological advancement; an order where access to affordable finance, crucial for development, is denied to those who lack reserve currencies  and when shocks hit  are forced into ever greater piles of debt aggravated by rising interest rates imposed by the central banks of the reserve currencies. . As a result, only 15 percent of all Sustainable Development Goals are on track, and 3.3 billion people now live in countries that spend more on debt servicing than on either health or education.   Cascading crisis not of our doing, have set us back several years in our achievements.

Your excellencies, our current system is nearing its limit

While in the last six decades the global economy has decentralized, the governance systems that underpin it have not. We still operate within an institutional framework created at a time where most African countries had not yet become independent; Uganda is an example.

Let me give you some numbers to illustrate this point. In 1945, the five permanent members of the UN Security Council constituted 10 percent of the organization's members; today, they are only 2.5 percent.

At their foundation, the boards of the IMF and the World Bank had 12 seats for a total of 44 countries. Today, each board has 25 seats representing 190 countries, to maintain the same proportion of representation the Boards of this institutions will have to double.

At the IMF, developing countries hold 41 percent of the votes while generating 58 percent of all GDP (in PPP) and having 86.4 percent of the world population. In comparison, the advanced economies have just 13.6 percent of the world’s population, and yet have 59.1 percent of the votes. China accounts for about 18 percent of the global economy, yet it enjoys just 6 percent of the IMF's voting share.

This massive representation issue highlights a truth that the UN Secretary-General underscored this weekend here in Kampala: “Let’s face it: those that benefit most from the present global governance system are unlikely to lead its reform.  Momentum for change must come from you, the South”. 

This Third South Summit provides a unique opportunity to do just that.

Excellencies,

Yesterday, UNCTAD co-hosted a High-level Seminar with China and Uganda where we heard many insights and proposals to tackle the challenges of the Global South. 

President Museveni made an intervention there, highlighting the asymmetries of the international trade system and the need for affordable long-term financing.

Global growth is slowing down, as a result of weak rates of growth of trade and investment specially for the developing countries

The summit of the future will put these challenges in the multilateral discussion. To go beyond GDP to measure development, to push for the necessary reforms in the international financial architecture, to look for a Governance system for AI and to reinvigorate the multilateral system that will enhance its potential without putting all humanity at risk. These discussions are not just theoretical or abstract. They are about the lives of billions of people, the overwhelming majority of which live in our countries.

In closing, let us carry forward a sense of hope and a call to action. We have the knowledge, the resources, and the collective will to create a better world. Whatever the contradictions, we are in a much better place to make a difference today than 60 years ago. But time is running out.

We hope the Third South Summit will be a milestone for stronger partnership, for a better and stronger multilateral system and for deeper cooperation between UNCTAD and the G77 and China.

Thank you.