Helen Clark: Speech at the Astana Economic Forum at “Kazakhstan’s Official Development Assistance System. Needs and Challenges of the ODA Today and Tomorrow”May 21, 2015
I am pleased to be part of this panel discussion on “Financing for the Post-2015 Development Agenda”. I thank Minister Idrissov and the Kazakhstan Ministry of Foreign Affairs for organizing this important post-2015 discussion in partnership with UNDP. We are pleased to enjoy a very strong relationship with Kazakhstan.
This September, world leaders gathered at the UN in New York are expected to adopt the post-2015 development agenda which will guide global development priorities for the next fifteen years. Kazakhstan has played an active role in the discussions on the new Sustainable Development Goals which UN Member States are placing at the heart of the new agenda.
As a strong supporter of multilateralism and as a development partner, Kazakhstan can play a big role in delivering this agenda, and in putting the world on track to achieve sustainable and inclusive development. By sharing its experiences and technical expertise and fostering trade and investment through South-South Co-operation, Kazakhstan will support others to develop.
Delivering an ambitious new agenda
While the final post-2015 agenda is still being negotiated, it is shaping up to be more ambitious than the MDGs were. It will aim to finish the unfinished business of the MDGs so that no one is left behind – including through the eradication of extreme poverty and of hunger. There is also consensus that the new agenda will urge all countries to act to:
- ensure our planet’s natural resources remain available for this and future generations;
- promote peaceful and inclusive societies, governed by the rule of law; and
- transform their economies and societies to pursue low-carbon, climate resilient, and inclusive paths to growth and development.
The new agenda seeks to address problems which have emerged, or have become more pronounced in recent years, including income inequality, and climate change and other environmental degradation.
This new, broad, and transformational agenda requires fresh thinking about financing development. The Third International Conference on Financing for Development (FfD), to be held in Addis Ababa in July, provides a forum for that.
Financing and enabling sustainable development
Key issues at Addis Ababa:
1. The role of Official Development Assistance
At Addis Ababa, it will be important for developed countries to recommit to
allocating 0.7 percent of their Gross National Income (GNI) to official development assistance (ODA). Larger shares of that ODA should go to the poorest and most vulnerable countries, including small-island developing states, least developed countries, and landlocked developing countries - where ODA is often a significant source of otherwise limited external financing.
ODA should be catalytic in strengthening the capabilities of people and institutions. It takes healthy, educated, empowered people and effective institutions to drive development.
Smart uses of ODA also include:
• catalysing new investments in research, technology, and sustainable infrastructure;
• strengthening domestic capacities to leverage all available sources of development and climate finance – public and private; and
• funding longer-term interventions like disaster risk reduction – on the basis that every dollar invested will be repaid several times over if disaster strikes.
Overall, ODA should help strengthen capacities for sustainable and inclusive development and domestic resource mobilisation. Supporting capacities to trade, attract investment, collect taxation, allocate funding, and deliver on policies and plans is vital.
More international public finance, beyond ODA, is also needed in important areas like communicable disease control and climate change adaptation and mitigation.
2. Private Investment & Loans – public and private
Private investment and loans play an indispensable role in financing development. Some suggest that the world has a global capital glut with insufficient opportunities to invest and too little guidance to channel it productively . Strengthening capacities to attract investment and design credit worth projects is vital development work.
Businesses respond to the rules of the game set by governments. By giving the right signals governments can encourage the private sector to align their business models and investment strategies with sustainable development objectives – for example, for clean energy, transport, and production systems. It is good to see that sustainable infrastructure is a central theme of this Forum. UNDP works with governments to this end, helping them to review and strengthen their policy and regulatory frameworks.
Meeting the challenge most countries, South and North, share of achieving a step-change in the provision of sustainable infrastructure could fuel new sources of economic growth, jobs, and innovation.
3. Domestic Resource Mobilisation
Increasing domestic resource mobilization will need to be at the heart of financing for sustainable development. Government attempts to maximize domestic resources can be constrained by tax evasion and avoidance and by illicit financial flows. Discussions and decisions on international tax regimes need to be prominent in Addis, and in the follow up to the Financing for Development Conference.
4. Risk-Informed Development
The Addis Ababa conference could also usefully focus on the importance of financing risk-informed development.
Volatile commodity prices, shifting weather patterns, increasingly extreme and frequent natural disasters, economic shocks, conflicts, and threats to citizen security have become the ‘new normal’ in our world.
As targets for development for the next generation are set, it is important to look beyond what is needed in stable times – they are not the times in which we live. Global interdependence, growing inequalities, and climate change and other rapid environmental degradation have left us all more vulnerable. The earthquake in Nepal is a tragic reminder that poor countries suffer the most from disaster deaths. From 1970 to 2008, over 95 per cent of natural-disaster-related deaths occurred in developing countries .
Without concerted efforts to strengthen the resilience of countries and communities and address climate change, the costs of disasters will rise, putting hard won development gains at risk. Overall, for every dollar invested in disaster risk reduction, it is estimated that around seven dollars will be saved in economic losses from disasters.
It would also be helpful to have agreement in Addis to include vulnerability in the criteria used by international financial institutions when evaluating countries applying for concessional lending. For instance, countries bearing the brunt of the large and increasing costs of climate shocks should not be locked out of the financing opportunities they need. Capacity support for vulnerable countries and communities should also be stepped up, so they can use funds effectively to strengthen their resilience.
UNDP is committed to its work to strengthen the capacities of countries to mobilize, manage, budget, and track the financing they need for development. We work with countries to establish National Financing Frameworks which can integrate diverse financing sources within their national budgets.
That is especially important now as the new sustainable development agenda requires integrated approaches to interconnected challenges. Well-designed policies can reduce poverty, while simultaneously protecting natural resources and strengthening resilience to shocks.
Alongside traditional ODA, South-South and Triangular Co-operation is playing a vital role in driving development. UNDP values its work with Kazakhstan as a growing contributor through South-South Co-operation. We stand ready to continue to scale up our work, including in support of KazAID, Kazakhstan’s new development co-operation agency, to support its delivery on the ground – including through triangular co-operation in selected partner countries.
We look forward to the discussion in today’s session on how traditional and South-South partners can help finance sustainable development.