Your Highnesses Your Excellencies Mr. Chairman Delegates
Ladies and Gentlemen

Firstly, I should like to commend the United Nations for the importance it attaches to the issue of financing for development and its attempts to increase the effectiveness of financial flows for development. This is the right way to deal effectively with the problems of development. A great deal of effort has been put into the preparations for this Conference and into formulating the draft declaration that will be adopted. The United Nations Regional Economic Commissions, including the Economic and Social Commission for Western Asia, have played an important part in those preparations.

The draft Monterrey declaration is, without doubt, comprehensive in outlook. It identifies the various areas of weaknesses in many fields of the financing for development system, and also points to the paths that must be followed in the future in order to close any gaps in this system.

I must take this opportunity to refer to the internal and external factors affecting the conditions in Western Asia, which have obstructed development efforts and the flow of funding and have, indeed, been one of the reasons for the reverse flow of resources to outside the region. A number of factors exert a negative impact on financing for development, including armed conflicts, the imposition of international sanctions regimes on certain countries of the region, increased defence spending, the concentration of foreign investment in a very small number of countries, and the increased external and internal indebtedness of a large number of countries.

Despite the natural resources it enjoys, foremost among which are oil and gas, the region has not benefited from the globalization movement to the same extent as other developing regions in the world. The extreme fluctuations in the price of oil since the beginning of the 1970s have had a sharp impact on the volume of financial flows. Furthermore, the Arab-Israeli conflict discourages foreign and domestic private sector investment in the region, and this is hindering the effort to tackle ever-increasing unemployment and slow growth rates.

Notwithstanding these harsh circumstances, the Western Asia region has made some gratifying progress. Achievements include the establishment of the Gulf Cooperation Council, which is targeting economic union between its members; the creation of an Arab free trade zone and the creation of regional funding institutions. Western Asia is perhaps the only region which has a distinctively regional monetary fund, namely, the Arab Monetary Fund. This Fund manages a financing mechanism for a programme aimed at developing trade between Arab countries. The Economic and Social Commission for Western Asia, in cooperation with those institutions, endeavours to participate effectively in establishing the foundation for sustainable development in the region, and assist member countries to increase measures for regional economic integration and confront the challenges of globalization.

Ladies and Gentlemen

If financing for development is to be increased, the following measures must be taken:

1. The role of regional financing institutions in every part of the world must be strengthened in order to make them the principal sources of financing for development.

2. The duties of the international financing institutions must be reconsidered. The International Monetary Fund could concentrate more on structural adjustment lending, while the World Bank could concentrate on the eradication of poverty, funding for development projects and supporting cooperation between regional and national institutions.

3. Official development assistance must be increased and the 0.7 per cent proposal or 20/20 initiative must be accepted.

4. Lending conditions must be reviewed in order to reduce the debt burden on small and developing countries and assist them, at the same time, to build and grow.

5. Domestic savings must be encouraged in developing countries and better use must be made of insurance funds. Social security networks, especially social insurance, must be strengthened, and the improved use of pension funds must be encouraged.

6. Radical solutions must be found to international and regional wars and conflicts in order to release the funds that are spent on military preparations and the expense of armies and redirect them towards development and construction.

Ladies and Gentlemen

There is no doubt that a conference like this, together with all the preparations that were made for it and all the work that will follow it, makes an effective contribution to strengthening channels of financing for development, both by mobilizing the available financial resources and increasing the efficiency of various ways and means of employing those resources. We all expect the Conference to have an impact on the effectiveness and cooperation of financing mechanisms at the international and regional level.