The recently released zero draft of the outcome document for the United Nations Summit in September 2015 outlines an ambitious agenda for global action. With its broad scope and highly set targets it constitutes an expensive vision that poses the question – where will the money come from to fund this vision? The upcoming conference in Addis Ababa on 13-16 July hopes to answer this. The conference is the third of its kind and its outcome will be crucial for the financing and implementation of the new agenda. The process, led by UN DESA (United Nations Department of Social and Economic Affairs), is also supported by UNDP as one of the key institutional stakeholders along with the IMF and the World Bank.
Gail Hurley gave an overview of the key issues to be addressed at the conference, including the status of negotiations, areas of consensus and potential stumbling blocks. The agenda is much broader than merely addressing what money is available. Domestic resource mobilisation (taxes), private financing, trade, technology, systemic issues, international financial and monetary systems, debt systems, and follow-up mechanisms to make sure states complete their commitments are but a few items on the crowded agenda.
Major investments will be made to the new development agenda both from domestic and international sources. Hurley particularly stressed the importance of domestic resource mobilization. Countries have a responsibility to mobilise resources through e.g. taxation for the sustainable development agenda. Some countries, however, find that there is too much focus on this and highlight the need for commitment to other ways of mobilising resources as well.
There have been some successes in the area of international debt relief. Without this, the SDGs will not be reached, Hurley stated. There are still major challenges for Small Islands Developing States (SIDS) and Least Developed Countries (LDC) and urgent solutions for these countries need to be found. There is, for instance, a need for a solvency and bankruptcy regime, but, at the moment, the language in the conference documents is weak. Strengthening the approach to restructure debt is crucial.
Also essential is to ensure that countries access the financing that best suits their needs. Hurley pointed out that complementarity of sources of financing is important and that all sources of financing are different; some are long-term, others more limited in scope, some involve risks, some are cyclical. The commitment to development aid effectiveness is crucial, and so is private sector finance while there is also a need to look at new incentives for the private sector. In addition, tax cooperation is a central issue, and one that causes some debate. Lastly, a key follow-up question is how to hold governments and other actors accountable for their commitments.
Bearing all this in mind, one is bound to ask “How will we fund the new development agenda?” Hurley pointed out that while unfortunately there is no new money “on the table” there are many commitments and ideas, which, if implemented, will make a significant impact on the new sustainable development agenda.
The Third International Conference on Financing for Development will gather high-level political representatives, including Heads of State and Government, and Ministers of Finance, Foreign Affairs and Development Cooperation, as well as all relevant institutional stakeholders, non-governmental organizations and business sector entities. The Conference will result in an inter-governmentally negotiated and agreed outcome, which should constitute an important contribution to and support the implementation of the post-2015 development agenda. Click here for more information.