Helen Clark: Speech on: "Financing for transformation: from agenda to action on sustainable development in Asia and the Pacific”

Jul 13, 2015

My thanks go to Executive Secretary Shamshad Akhtar and ESCAP for organizing this important side event. UNDP is very pleased to support this discussion today alongside ESCAP and the Asian Development Bank.

The Asia-Pacific continues to be a growth engine for the global economy. With its many major emerging economies, large population, and vast resources, how the region advances on sustainable development is of global significance.

Within the region, there is great diversity:
- There are the mega emerging economies which are both sources and recipients of private investment flows, and which are significant providers of South-South Co-operation.
- At the other end of the spectrum though are countries
which struggle to mobilize domestic resources, are heavily aid dependent, have poorly diversified economies, and are vulnerable to shocks.


Even where growth is strong and human development progress has been solid overall, domestic inequalities have increased in some countries and are a cause for concern for the future.

The emerging global development agenda is clear that as a matter of principle nobody should be left behind. In financing its transformation to sustainable development, a focus on both poverty eradication and reducing inequalities is relevant for the Asia-Pacific.

Let me make four points about financing for development which are relevant to this region:

First, domestic resource mobilization already plays a huge role in many countries in the region, but it could be enhanced further. For example:
• Huge gains could be made by ensuring that all tax regimes are well-designed, fair, and efficient.

• Gains could also be made through strengthening efforts to curtail illicit financial flows. These were estimated at $474 billion in 2012 in Asia-Pacific, accounting for almost half of all such flows from developing countries that year. Fraudulent trade misinvoicing is the largest form of illicit flows, $354 billion dollars in Asia-Pacific in 2012 alone.

• Regulatory regimes can play a part in incentivizing the shift to a green economy and society, for example, with respect to fossil fuel subsidies and to encouragement for investment in renewable energy and energy efficiency.

Second, all modalities of finance for development, from ODA to South-South and Triangular Co-operation and other forms of international public finance have a role to play in the region.

Some countries of the region are important providers of financial and technical assistance to others; but there are also twelve Least Developed Countries in the region and states which continue to experience significant levels of conflict. 
 
In this latter group, there continues to be heavy dependence on ODA. 

Then, Pacific Island countries have among the highest climate change adaptation costs in the world when measured as a proportion of national output. ODA and climate finance will be critical to their efforts to reduce their disaster risk and adapt to climate change.

UNDP advocates for the criteria for concessional finance to have more regard to vulnerabilities faced by countries in special development situations.

Third, if development is not risk informed, it will not be sustainable development. The recent earthquake in Nepal and Cyclone Pam in Vanuatu and Tuvalu remind us all how disasters can wipe out development gains.

Climate change will increase further the frequency and severity of weather-related disasters. Investing in risk reduction and in building climate resilience will save lives and protect development gains.

UNDP has strongly advocated for the new financing for development framework to incorporate risk management fully – volatility is the new normal in the world today.

We have been supporting Ministries of Finance in Asia and the Pacific to work on integrating climate change and broader disaster risk reduction considerations into their budget processes. One such example is the Climate Fiscal Frameworks established by the Ministries of Finance in Bangladesh and Indonesia.

Fourth, capacity needs to be built to maximize access to a range of finance. Over the SDG period to 2030, we can expect to see increases in all sources of finance, and in the range of financing instruments and delivery channels. All countries need to be able to access the types of finance most suited to their needs.

Building these capacities lies at the heart of UNDP’s mandate. We are committed to supporting the mobilization and the effective management of various financing for development streams.

In the region, we are providing the secretariat for the Asia Pacific Development Effectiveness Facility to help governments, development partners, and civil society organizations navigate the evolving financing landscape and focus on the reforms which can produce financing for sustainable development.

In conclusion, the financing for development needs of the region are high, but there are also more resources and capabilities than ever before to meet the challenges before us. Nowhere is this more evident than in the Asia and the Pacific region.

UNDP looks forward to working with all its partners to build on the region’s successes.

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