Speakers Stress Official Development Assistance Critical to Economic Progress, as Second Committee Takes Up Landlocked Developing, Least Developed Countries
Foreign direct investment (FDI) and official development assistance (ODA) were both essential to development efforts, the Second Committee (Economic and Financial) heard today as delegates met to discuss groups of countries in special situations.
The representative of Zambia, speaking on behalf of the Group of Landlocked Developing Countries, noted that ODA had not yet fully recovered to 2010 levels, and called on development partners to meet their ODA commitments.
Also highlighting the decline of FDI in landlocked countries, she called for the establishment of new investment vehicles such as venture capital funds and blended finance, complemented by innovative debt-funding structures with the appropriate risk management frameworks.
The representative of Kazakhstan expressed her country’s eagerness to “blunt” the most limiting effects of “landlockedness”. With its ambitious national goal of joining the top 30 developed countries of the world by 2050, Kazakhstan was implementing educational, judicial and legal reforms that would make it an attractive destination for capital, technology and business.
The Committee also today discussed the situation of least developed countries, with the representative of Bangladesh, who spoke on their behalf, stressing that the Group contained the “poorest, weakest and most marginalized segment of the international community”.
The Ebola epidemic in West Africa, earthquakes in Nepal and Afghanistan, floods in Myanmar and a cyclone in Vanuatu had damaged already vulnerable economies, he said. Climate change was a question of life and death for many least developed countries.
Echoing those words, the representative of Haiti, who spoke on behalf of the Caribbean Community, pointed out that economic progress in those countries had slowed down in 2014. While those States accounted for only 12 per cent of the world’s population, as much as 30 per cent of the world’s hungry lived in them, he said, urging an increase in ODA.
The international community could not simply “wish away” the fact that ODA was the largest source of development finance for a large number of countries, the representative of South Africa, speaking on behalf of the “Group of 77” developing countries, said. She also stressed the importance of providing duty-free and quota-free market access for all products from least developed countries.
The representative of the Maldives brought another perspective to the debate by noting that his country, by virtue of its graduation from the category of least developed countries, no longer had access to concessionary financing, which had led to a greater debt burden. With its limited natural resources, remote regions and small economy, the country remained economically vulnerable.
Many Member States lauded the Istanbul Programme of Action for the Least Developed Countries for the Decade 2011–2020, with the representative of Turkey calling it “a forward-looking reference document”. The goal of graduating half of the least developed countries out of that category by 2020 was ambitious but achievable, she said.
Along similar lines, Paraguay’s delegate lauded the Vienna Programme of Action for the Landlocked Developing Countries for the Decade 2014-2024 as a coherent and holistic tool for eradicating poverty. Development partners must help implement its priorities, including transit freedom and structural economic transformation.
Gyan Chandra Acharya, Under-Secretary-General and High Representative of Least Developed Countries, Landlocked Developing Countries and Small Island Developing States, introduced the Secretary-General’s reports. Those included the implementation of the Programme of Action for the Least Developed Countries for the Decade 2011-2020; the feasibility study for a United Nations technology bank for the least developed countries; the implementation, effectiveness and added value of smooth transition measures; and the implementation of the Vienna Programme of Action for the Landlocked Developing Countries for the Decade 2014-2024.
Also speaking today were the representatives of Ecuador (speaking on behalf of the Community of Caribbean and Latin American Countries), Kyrgyzstan, Russian Federation, Brazil, Botswana, Mongolia, China, Lao People’s Democratic Republic (speaking on behalf of ASEAN as well as in their national capacity), Myanmar, United States, Japan, Bhutan, Benin, Nepal, Indonesia, Ethiopia, and Malawi.
The Committee will meet again at 10 a.m. on Monday, 2 November, to discuss agriculture development, food security and nutrition.
Introduction of Reports
GYAN CHANDRA ACHARYA, Under-Secretary-General, High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States, presented the Secretary-General’s reports on the implementation of the Programme of Action for the Least Developed Countries for the Decade 2011-2020 (Istanbul Programme of Action; document A/70/83-E/2015/75), the feasibility study for a United Nations technology bank for the least developed countries (document A/70/408), the implementation, effectiveness and added value of smooth transition measures (document A/70/292), and the implementation of the Vienna Programme of Action for Landlocked Developing Countries for the Decade 2014-2024 (document A/70/305).
On implementation of the Istanbul Programme of Action for the Least Developed Countries for the Decade 2011-2020, he said that due to a deceleration of economic growth, fewer least developed countries had managed to reach the set target of 7 per cent growth. Noting mixed progress in its various areas of priority, he underscored that extreme poverty continued to be unacceptably high in the least developed countries, with an estimated 49.9 per cent of the population in those States living below the international poverty line. On the technology bank, he said its establishment constituted an important milestone for the least developed countries, underscoring the need for significant mobilization of resources across various areas and from all partners.
Turning to the report on smooth transition measures, he said analysis had shown that recently graduated countries overall continued on their development path with almost similar levels of development assistance flows and exports. Their strategies had received support from some key development partners who were encouraged to apply the least developed country criteria to their aid allocation process. Presenting specific findings in the report on the implementation of the Vienna Programme of Action, he said a number of intergovernmental activities had either been initiated or undertaken in support of landlocked developing countries. The Addis Ababa Action Agenda and the 2030 Agenda for Sustainable Development were critical and complementary to the Vienna Programme of Action, he said, urging strong commitment to diversify the economies and undertake measures for the rapid, inclusive and sustained growth and development of landlocked developing countries.
Interactive Dialogue
In the ensuing dialogue, the representative of Paraguay reaffirmed his county’s commitment to the Under-Secretary-General’s work and stressed the importance of developing indicators. The representative of the United Kingdom asked about the model for the technology bank and the representative of Liberia asked about the Group of Seven Plus.
Responding, Mr. ACHARYA said that after detailed discussions on the modality of the technology bank for least developed countries, it had been decided that the United Nations University provided the best model. Given that access to technology was a constant problem for least developed countries, and also considering the need to bring about rapid change quickly, what was needed was a strong institution owned by all Member States of the United Nations. Turning to the Group of Seven Plus, he said that the Istanbul Programme of Action had made a clear reference to the challenges faced by least developed countries in conflict. While there was no reference to the Group of Seven Plus because the United Nations had not recognized them as a group, that issue was definitely under consideration.
Statements
Ms. MOLEKO (South Africa), speaking on behalf of the Group of 77 developing countries, said the international community should provide adequate support to least developed States so they could achieve the ambitious targets in the Istanbul Programme of Action. “A fact that cannot be wished away is that ODA was the largest source of development finance for a large number of those countries,” she stressed. It was therefore a matter of grave concern that ODA to least developed countries had fallen by 15 per cent in 2014. Calling for that trend to be reversed immediately, she added that it was also important to provide duty-free and quota-free market access for all products from least developed countries.
Turning to the situation of landlocked developing countries, she noted that the unique challenges of those States had been exacerbated by poor infrastructure, low levels of development in the information and communications technology (ICT) sector and severe challenges in access to energy. In 2014, those countries were also ranked among States with the lowest levels of human development. She said that development partners should be encouraged to provide targeted financial and technical support towards the implementation of the specific actions in the Vienna Programme of Action for Landlocked Developing Countries for the Decade 2014-2024.
DENIS REGIS (Haiti), speaking on behalf of the Caribbean Community (CARICOM) and associating himself with the Group of 77, Community of Latin American and Caribbean States (CELAC) and the Alliance of Small Island States, said the various actions undertaken in 2015 would undoubtedly strengthen the potential of least developed countries. He deplored the fact that the economic rebound made by the least developed countries had halted in 2014 with a decrease of the total gross domestic product (GDP) of the whole Group at 5.15 per cent, compared to 5.4 per cent in 2013. The low rate of investment remained the main obstacle to productive capacity. Although production had increased to 14 per cent in 2013, it represented only 2 per cent of the world volume.
More remained to be done to address growing challenges in broadband Internet access and in the energy sector, in spite of the fact that only one in three residents had access to electricity in least developed countries, he said. Moreover, food security and rural development continued to be a source of great concern. Of the world population suffering from hunger, 30 per cent lived in least developed countries which accounted only for 12 per cent of the world’s population. The share of those countries in world trade had only increased to 1.14 per cent in 2013, he said, urging an increase in ODA. The low growth of remittances from migrant workers had not compensated in the dip of ODA.
A. K. ABDUL MOMEN (Bangladesh), speaking on behalf of Group of Least Developed Countries and associating himself with the Group of 77, stated that his Group contained the “poorest, weakest and most marginalized segment of the international community”. They were constrained by low per capita income and high vulnerability to economic and natural shocks. The Istanbul Programme of Action provided a detailed road map for reaching the target of halving the number of least developed countries by 2020. The largest source of development finance for many of those States was ODA and he called upon all development partners to fulfil their commitments to provide .15 to .20 per cent of their gross national income to least developed countries.
Climate change, he added, was a question of life and death for many countries in his Group. The increased vulnerability of least developed countries to economic, natural and environmental shocks and disasters had been exacerbated by different crises. The Ebola epidemic in Liberia, Sierra Leone and Guinea; a devastating earthquake in Nepal and Afghanistan; floods in Myanmar and a cyclone in Vanuatu were some recent examples of calamities that had destroyed the already vulnerable economies and infrastructures of least developed countries. It was also vital to ensure debt sustainability, including through cancellation of multilateral and bilateral debts.
THERESAH LUSWILI CHANDA (Zambia), speaking on behalf of the Group of Landlocked Developing Countries, expressed concern that FDI flows to landlocked countries continued to decline at a time when ODA had yet to fully recover to its 2010 levels. The problem had been further compounded by currency crisis and weakened global demand for landlocked developing countries primary exports. She called on development partners to meet their commitments which included providing financial and technical support, mobilizing private sector resources and opening up markets to landlocked country exports.
There was also a need to share best practices and experiences on how to implement the Vienna Programme of Action, she said. Landlocked developing countries needed assistance to establish effective national coordination. On trade, she called for a conclusion to the Doha Round and for the World Trade Organization (WTO) to fully deliver on its development-oriented mandate. She urged an immediate establishment of new investment vehicles such as venture capital funds, blended finance, risk mitigation instruments and innovative debt funding structures with the appropriate risk management and regulatory frameworks.
KHIANE PHANSOURIVONG (Lao People’s Democratic Republic), speaking on behalf of Association of Southeast Asian Nations (ASEAN) and associating himself with the Group of 77, underscored the importance of implementing the 2030 Agenda for Sustainable Development. That was challenging for countries in special situations such as least developed countries, landlocked developing countries and small island developing States. ASEAN welcomed the support of the international community to those countries in implementing their national development plans including the Istanbul Programme of Action, Vienna Programme of Action and the Small Island Developing States Accelerated Modalities of Action outcome document (Samoa Pathway). Despite progress made, those countries still faced serious challenges and needed more assistance from the international community and development partners.
ASEAN had made commendable progress in regional cooperation and integration and would realize its vision to become the ASEAN Economic Community later in the year, he said. Cognizant of the development gap between its members which were countries in special situations and other members, the regional group had adopted various initiatives in that regard. The ASEAN Framework for Equitable Economic Development and the Master Plan on ASEAN Connectivity had significantly contributed to narrowing the gap and promoting sustainable development in the region.
SERGIO SHCHERBAKOV (Ecuador), speaking on behalf of CELAC, expressed support for the efforts towards the upcoming midterm review of the Istanbul Programme of Action and hoped that the monitoring results of the Fourth United Nations Conference on the Least Developed Countries would be positive. CELAC also welcomed the adoption of the Vienna Declaration and the Vienna Programme of Action. He reaffirmed the Community’s commitment to promote the appropriate consideration of the special needs and particular challenges of landlocked developing countries in accordance with the provisions of the Vienna Programme of Action, and of least developed countries in accordance with the Istanbul Programme of Action.
MADINA KARABAEVA (Kyrgyzstan), associating herself with the Group of Landlocked Developing Countries, said that while the members of that Group had the responsibility to implement the Sustainable Development Goals, the issue of financial support for that process was a matter of international cooperation. Developed countries must comply with their ODA commitments. To implement the Vienna Programme of Action, her country had developed an interdepartmental plan and was promoting regional and international trade. Integration and developing regional infrastructures was another key issue for Kyrgyzstan. Her country was also developing a “green economy” through the building of hydroelectric installations that would improve access to electricity.
IRINA A. MEDVEDEVA (Russian Federation) said that her country reaffirmed support for the Istanbul Programme of Action and was concerned about the low rate of growth in least developed and landlocked developing countries. Additional support should be given to broaden the production potential of those countries. That would create new jobs, diversify the economy and promote the implementation of the 2030 Agenda. Welcoming the proposal for the technology bank and the recommendation to launch it during the upcoming comprehensive midterm review of the Istanbul Programme of Action, she added that her country would continue to support the economic, intellectual and scientific potential of least developed countries. The Russian Federation had written off the debt of most African countries, while it also worked to reduce debt through the “debt for development” swap mechanism in the Heavily Indebted Poor Countries Initiative.
SÉRGIO RODRIGUES DOS SANTOS (Brazil), associating himself with the Group of 77 and CELAC, said that his State had undertaken many regional cooperation initiatives with developing countries in general and with least developed countries in particular. Among those initiatives he cited a cotton project in four African countries and an international forum on maternal milk banks. His delegation believed that projects involving infrastructure integration to the benefit of least developed and landlocked developing countries should be granted special and differentiated treatment by international development banks and financial institutions.
AHMED SAREER (Maldives), associating himself with the Group of 77 and China, said his country had limited natural resources, small populations and small economies. The Maldives were remote, highly dependent on imports and therefore extremely vulnerable to economic shocks. They also suffered from high dependence on one economic sector and high costs of transportation and production. The people of the Maldives lived on 188 separate islands, and only 20 of the islands had populations exceeding 2,000. The Government had to provide basic services and invest in infrastructure that was necessary to sustain development gains. No longer being a least developed country had blocked access to concessionary financing and forced the nation to borrow at unsustainable interest rates. That strain on financing was leading to greater debt burdens, with debt-to-GDP ratio estimated to reach 85 per cent in the coming years.
TLHALEFO B. MADISA (Botswana), associating himself with the Group of 77 and the Group of Landlocked Developing Countries, said challenges in his country were compounded by being landlocked as well as being classified a middle-income country. Landlocked developing countries ranked poorly in the social development sphere and were at most serious risk of not achieving development goals. Transport costs in landlocked countries in comparison to coastal economies were constantly on the increase, while trade volumes continued to be low. The majority of landlocked developing countries were single-commodity dependent and were also threatened by land degradation and climate change. Those countries were prone to external shocks and the volatility of commodity prices. Landlocked countries had difficulty attracting foreign direct investment, he said, calling for increased technical and financial assistance.
AZIZA YESHMAGAMBETOVA (Kazakhstan), associating herself with the Group of Landlocked Developing Countries, stated that her country was eager to implement the Vienna Programme of Action and “blunt the most limiting effects of landlockedness”. Her country wanted to fulfil its ambitious national goal of joining the top 30 developed countries of the world by 2050. Kazakhstan’s comprehensive national plan called for drastic and urgent reforms to its education, legal and judicial systems and she was confident that development partners would find the country an attractive destination for their capital, technology and business. The country was especially focused on addressing the bottlenecks and inefficiencies in its transport networks.
SUKHBOLD SUKHEE (Mongolia), associating himself with the Group of 77 and with the Group of Landlocked Developing Countries, said that his country’s socioeconomic development was hindered due to a lack of territorial access to the sea. That constrained development by limiting the value addition of exports and the capacity to diversify products and markets. Welcoming the decision in the Addis Ababa Action Agenda to launch a new global infrastructure forum, he expressed support for the proposal to undertake broad-based consultation on the modalities for the establishment of this new forum. Further, his delegation welcomed the proposal to launch a dedicated work programme for landlocked developing countries in the areas of trade facilitation, trade diversification, services, Aid for Trade, electronic commerce and World Trade Organization (WTO) accession.
LUO JIN (China), associating herself with the Group of 77, said donors must honour their commitments, reverse the downward trend of ODA resources, and increase their assistance to least developed and landlocked developing countries. The international community should conduct multiple forms of cooperation at the global, regional and national levels and increase support for those countries in all dimensions. Noting the varying degrees of progress in implementation of the Istanbul Programme of Action’s eight priority areas, she expressed hope that the 2016 high-level midterm review conference would arrive at practical measures for improvement. Turning to the Vienna Programme of Action, she said her country stood ready to work with all parties to push for its implementation.
KHAMPHINH PHILOKONE (Lao People’s Democratic Republic) associating himself with the Group of 77, the landlocked developing countries and least developed countries, commended the adoption of the Vienna Programme of Action, the Istanbul Programme of Action and the SAMOA Pathway. His Government had mainstreamed its priorities under the Vienna Programme of Action into its vision of transforming itself into a land-linked country by promoting connectivity with neighbouring countries in the Greater Mekong sub-region, as well as the wider region. Increased investment in infrastructure projects such as the construction of roads, railways and bridges to link the country to the Asian Highway and Trans-Asian Railway networks were part of that vision.
SANN THIT YEE (Myanmar), aligning with the Group of 77, ASEAN and the Group of Least Developed Countries, said that since the second half of the Istanbul Programme of Action implementation period coincided with the first five years of the 2030 Agenda, there had to be a strong synergy and coherence between the implementation of the two processes. Since 2012, Myanmar had opened up its economy with more liberalized trade and economic policies, and had maintained an average 8 per cent GDP growth surpassing the Government’s goals for foreign direct investment by receiving $8 billion in 2014. While the primary responsibility for development of Myanmar rested with its Government and people, the favourable external environment and ODA also played a role.
JILL DERDERIAN (United States) said her country had been committed to focusing ODA resources where they could produce the greatest impact and especially to low-income countries that were committed to growth and poverty reduction. Since 2005, the United States allocation to low-income countries — as a portion of total bilateral net ODA disbursements — had more than doubled from close to 18 per cent to nearly 37 per cent. However, overcoming structural challenges that countries in special circumstances faced would require far more than ODA, she said, urging a recommitment to transparent and accountable Government and to promoting truly inclusive growth. Development required the creation of stable, predictable and enabling investment environments to attract FDI. She underscored several United States programmes that helped bring electricity to African countries in need.
YOSHIYUKI MIKAMI (Japan) stressed the importance of implementing the 2030 Agenda in cooperation with least developed and landlocked developing countries. The Istanbul Programme of Action made it clear that the least developed countries had to enhance productive capacity in order to achieve sustainable development, he said, expressing support to those States in realizing that goal. He emphasized the protection of rights in the successful transfer of technologies from developed to developing countries. An international tech-bank must be sustainable in terms of financial and institutional aspects and without prejudice, he said, stressing the importance of transparency in that process. The development of landlocked nations was critical. The Vienna Programme of Action renewed global support to that and must be implemented accordingly.
CEREN HANDE ÖZGÜR (Turkey), emphasizing that her country attached great importance to the challenges of the most vulnerable countries, stated that the Istanbul Programme of Action was “a forward-looking reference document” that reflected the political will of the international community to support the least developed countries. Calling for its effective implementation, she added that the Programme stressed the importance of improving the productive capacity of those countries and had set a goal for half of them to reach the criteria of graduation by 2020. While that seemed ambitious, it was achievable. Her country had announced an economic and technical cooperation package for least developed countries, which included financial assistance and scholarships. Turkey also contributed to the development of least developed countries in Africa with investments reaching nearly $6 billion. “Our relations with least developed countries [are] based on partnership,” she stressed.
FEDERICO ALBERTO GONZÁLEZ FRANCO (Paraguay), associating himself with CELAC, the Group of Landlocked Developing Countries and the Group of 77, said that the Vienna Programme of Action aimed to meet the special needs of landlocked developing countries. It was a coherent and holistic tool for eradicating poverty in those countries and it complemented the Sustainable Development Goals, as well as the provisions of the Addis Ababa Action Agenda. The Programme had six priorities, including freedom of transit, the maintenance of infrastructure for transport and communication, international trade and regional cooperation and structural economic transformation. Paraguay urged all development partners to make efforts for the successful implementation of the Vienna Programme of Action, as well as the WTO trade facilitation agreement for transit countries, adopted in Bali in 2013.
TSHERING GYALTSHEN PENJOR (Bhutan), associating himself with the Group of 77, the Group of Least Developed Countries and the Group of Landlocked Developing Countries, said that under the current ODA trend, approximately $40 billion per year was earmarked for least developed countries. Over the next 10 years, even under a ceteris paribus assumption, that amounted to $400 billion in total ODA to least developed countries. A mechanism that allowed for such global ODA commitments to be made in the form of five- if not 10-year pledges of budgetary support to those States at the country level would provide a high degree of predictability in resources. Such predictability would enable each of them to develop ambitious, comprehensive and integrated national development strategies, plans and projects under the eight priority areas, as well as other internationally agreed development goals with a medium and long-term perspective.
JEAN-FRANCIS R. ZINSOU (Benin), associating himself with the Group of 77, the African Group and the Group of Least Developed Countries, said that in spite of various efforts, the progress in economic growth in least developed countries had fallen short of expectations due to export price fluctuations. There had been reductions in ODA as well and the international community must leverage resources to fulfil the goals set out in the Istanbul Programme of Action, as well as the 2030 Agenda. A significant share of the populations of least developed countries lived in poverty and they would be left behind if those countries and their development partners did not step up their efforts. Benin welcomed the bold measures and proactive policies adopted by the Governments of those countries, and called on them to stay on course, notwithstanding the poor economic situation.
WALLIYA PREMCHIT (Thailand), associating herself with ASEAN and the Group of 77, said that her country’s socioeconomic development path had enabled it to access the rank of middle-income country three decades ago. Promoting regional connectivity, both in hardware and software, was crucial to unlocking the economic potential of the more remote and isolated areas, bridging regional development gaps and raising the international competitiveness profile. Thailand had been working with ASEAN and other development partners to provide financial and technical assistance to neighbouring countries. Further, since countries in special situations were the most vulnerable to environmental challenges caused by natural disasters, the international community must mobilize support to make them more resilient.
SEWA LAMSAL ADHIKARI (Nepal), associating herself with the Group of 77, Group of Least Developed Countries and the Group of Landlocked Developing Countries, said her State was prone to multiple disasters and experienced the disproportionate effects of climate change. In the aftermath of the 2014 earthquakes, the Government had been focusing on reconstruction and rebuilding with a plan to build back better. In addition to that, the Government focused on capacity and infrastructure development, connectivity improvement and domestic resource mobilization. Landlocked developing countries deserved special understanding from transit countries and enhanced support from development partners and the private sector.
RINA SOEMARNO (Indonesia), aligning herself with the Group of 77 and ASEAN, expressed concern that poverty remained widespread in many least developed countries, with nearly half of their population living in extreme poverty. Structural transformation was fledging and insufficient, and needed to be accelerated over a long period of time. She called on developed States to increase investment in least developed countries, which would in turn generate new jobs and reduce poverty. It was important to address the special needs of landlocked developing countries, particularly those relating to trade development and regional integration. A multidimensional approach was required to respond to the unique and growing needs of countries in unique situations especially those that were landlocked.
BELACHEW GUJUBO GUTULO (Ethiopia), associating himself with the Group of 77, the African Group and the Group of Landlocked Developing Countries, said that as a landlocked country, his State continued to invest in trade logistics-related programmes with the objective of accelerating trade facilitation and enhancing its competitiveness and connectivity. The international community should also enhance its ODA to landlocked developing countries, incentivize the flow of FDI and reduce the cost of transfers of remittances.
LOT DZONZI (Malawi), associating himself with the Group of 77, Group of Least Developed Countries and Group of Landlocked Developing countries, called for the implementation of the Istanbul Programme of Action and its integration into the Sustainable Development Goals to enable half of the least developed countries to meet their graduation criteria by 2020. The Istanbul Programme should allow least developed countries to benefit from duty and quota-free market access, as well as supply side capacity-building. A new forum to bridge the infrastructure gap for landlocked developing countries was necessary and hopefully development partners would support it. Underscoring the importance of establishing an international investment support centre for least developed countries, he said the Addis Ababa Action Agenda had provided a solid platform which could be built on.