TWN Info Service on UN Sustainable Development (Apr15/07)
27 April 2015
Third World Network

Financing for Development and post-2015 development agenda are distinct and complementary, says South

By Ranja Sengupta, New York (24 April 2015)*

In a joint meeting of the intergovernmental negotiations on the preparatory processes of the Third International Conference on Financing for Development and the post-2015 Development Agenda, Member States were particularly divided over how to deal with the outcomes from the two processes.

The meeting took place on 21 – 24 April at the UN headquarters in New York.

The developing countries led by the Group of 77 and China stressed the need for the outcome of the Financing for Development (FfD) conference in July this year in Addis Ababa to be linked to, but as complementary to and independent of, the Means of Implementation Goal and targets in the Post-2015 Agenda (referring to the 17 Sustainable Development Goals that include the stand alone Goal 17 on MOI).   This was further supported by several groupings such as the Least Developed Countries, the Alliance of Small Island States, the Caribbean Community, the African Group and the Pacific Small Island Developing States.

On the other hand, the general view of developed countries was to import the FfD outcome document in toto into the post-2015 Agenda as the Goal on MOI. The MOI discussions, especially in the context of the FfD process, has perhaps been one of the most contentious in the ongoing General Assembly discussions on the post- 2015 Development Agenda, which is to be adopted at the General Assembly Summit in September this year.

The developing countries have also argued that the FfD document does not address non-financial MOI, which is critical for the post-2015 agenda. The discussion on technology is also weak in the FfD document, they stress. After repeated requests from developing countries, the April MOI session had included a one-day discussion on a Technology Facilitation Mechanism, an issue that has seen bitter battles and deep divisions in the past. The monitoring and review mechanisms for these two processes, whether separate or joint, was also an area of contention.

(See separate report on “Will ‘the wall’ be broken? – Discussion begins on Technology Facilitation Mechanism in Post-2015 Agenda”.)

In sum the developing countries expressed concern that fully overlapping the two outcomes (FfD and MOI of the post-2015 agenda) as per the developed countries’ recommendation will dilute and bring down the ambition level of the MOI of the post-2015 agenda. At the same time it will render the FfD as nothing more than the 15-year framework of the post-2015 agenda whereas the FfD has not only a longer, but also a different, even though overlapping, mandate.  

The 21 – 24 April session was led by the Co-facilitators Ambassadors David Donoghue of Ireland and Macharia Kamau of Kenya, who were joined by the Co-facilitators of the FfD process, Ambassadors George Talbot of Guyana and Geir Pedersen of Norway. The week’s discussions were preceded by the second drafting session for the FfD on 13 – 17 April.

At the beginning of the session, the four Co-facilitators addressed the Member States. Ambassador Donoghue talked about the ambition of the post-2015 agenda and the notion of “universality with differentiation”, given the different country contexts that underpin the post-2015 agenda. He also suggested that the Addis Ababa conference should build on the ambition of the SDG targets and the post-2015 agenda. He highlighted the need for an enabling policy environment, new institutions, new commitments, global partnerships as well as review and monitoring,  which will all be needed to implement this new framework and to drive it forward.

Ambassador Kamau highlighted how he felt ambition and universality represented itself in the world we live today.  It is about ending poverty, inequality and promoting shared prosperity, he said. Drawing attention to the tragic death of 900 migrants while crossing the Mediterranean as covered in that day’s news Kamau reminded everyone of the real issues that the UN membership was seeking to address: inequality and poverty, and terrorism. The task is, he said, how are we going to put together a post-2015 agenda that seeks to address these issues and that we also need to find the means of implementation for it. We recognize that we have the FfD and MOI challenge that we have to overcome before September, he pointed out.

Ambassador Kamau also stressed that the ambition in the SDGs actually surpasses the development financial flows today and achieving the SDGs will mean going from millions to billions in resource flows. This requires a financial framework working at both national and global levels. But we must recognize that this is doable and it requires political will and technical capacity. The Ambassador hoped that “we never again have to hear about the number of goals and targets of the SDGs”.
Ambassador Talbot said the week gives us the opportunity to step back and re-focus. He suggested that the group is here for “you and your families.” He said that if we see our agenda in terms of people, ourselves, and those connected to us, we will all become champions and accept the mantle of responsibility to bring change. While agreeing that this is a doable challenge and failure is not an option, he also cautioned that the process will not be smooth and there will be issues to work out. Talbot said we have to build mutual understanding and confidence and demonstrate to each other and to the world that we are committed to this transformative ambitious universal agenda. The FfD and post-2015 development agenda are very connected in that process of transformation, he said. We have to match the ambition level of the SDGs on the financing track.

Talbot went on to say that the (FfD) Zero Draft seeks to provide a framework building on the outcomes of Rio+20 but it also seeks to build a platform for specific deliverables, which this week allows us to think about. The specific deliverables are: what are the critical investments that must be made; what are the critical lead actions that we as a global community take and support; and, how will we unfold the work on implementation. The fourth dimension needed here is political will, he highlighted. Critical investments should be made in key sectors such as health and education and energy. He drew attention to technology as a key focus area and said that we need to made significant transitions in technology.

Ambassador Pedersen stressed on the need for urgency as we have a shorter time compared to the Monterrey consensus (from the first FfD conference in 2002). This is an enormous task but it is doable and political will is needed in the FfD process. In 12 weeks we need to find solutions like we have never done before, he emphasised.

The G77 and China, in the first statement of the session presented by South Africa, said that this joint meeting enables the Member States to look at possible linkages and synergies of the FfD process and that of the post-2015 Development Agenda and is timely in the context of the recently held second drafting session of the FfD process the week before (12 – 16 April).

The Group reaffirmed the holistic scope of the Monterrey Consensus and the Doha Declaration on Financing for Development. “In this regard, the Group's position is to maintain the balance of the 2002 Monterrey Consensus and the 2008 Doha Declaration as reflected in their structures and should be the basis for the development of the Addis Ababa Outcome Document” the Statement said.

(The second FfD conference in 2008 held in Doha reviewed the implementation of the Monterrey Consensus.)

The G77 and China reiterated the following key points based on their February 2015 position paper.

First, the UN Member States have agreed that the OWG-SDG report would be the "main basis" of the post-2015 Development Agenda intergovernmental negotiations as it integrates the Means of Implementation (MOI) both as a stand-alone goal and also within goals. In this regard, the Group underlines the need for stronger synergies between the Post-2015 Development Agenda and the FfD Conference.

The Group also appreciated the scheduling of discussion on the Technology Facilitation Mechanism (TFM) and looked forward to a constructive deliberation on specific aspects related to the establishment of a TFM for the implementation of the SDGs.

Second, while the focus of the FfD conference should primarily be on its core mandate and scope, it should consider specific MOI for SDGs, taking into account and building on the MOI goal and targets in the OWG Report and “without prejudging or precluding discussions on the MOI under the post-2015 Development Agenda track”.

Third, the Group highlighted the complementarity of, as opposed to exact overlap between, the MOI under the Post-2015 agenda and the FfD process. “The FfD process should complement and support the elaboration of the post-2015 agenda. As such, it should provide a set of tools that will support the implementation of the Post-2015 development agenda. However, FfD is a separate process and its scope goes beyond merely financing the SDGs. In a similar manner, the post-2015 Development Agenda will draw from the means of implementation contemplated in the FfD outcome in light of its adequacy and relevance towards the implementation of its goals and targets, but this will not exhaust its means of implementation, which go beyond those elaborated by the FfD outcome document” the statement said.

Fourth, the G77 and China also called upon developed countries “to agree and commit to a new phase of international cooperation through a strengthened and scaled-up global partnership for development, which should be the centerpiece and anchor for both completing the unfinished business of the MDGs and implementing the post-2015 Development Agenda, taking into account the lessons learnt from the gaps in the implementation of MDG8 (on global partnership for development). The international community should provide enhanced and adequate means of implementation to developing countries, including through quantitative time-bound financing targets besides those established for ODA, debt relief and debt restructuring, trade, technology transfer and greater participation of developing countries in global economic governance”.

Next, the Group acknowledged the discussion of financing for climate change in the FfD but said “the FfD process must recognize UNFCCC (UN Framework Convention on Climate Change) as the main multilateral platform for discussions on climate finance. Climate finance must not be double counted as ODA and therefore must be considered as separate from and additional to ODA.”

Finally, the Group pointed to the urgent need to achieve an appropriate balance between the roles and the responsibilities of the public and private sectors, in these two processes. The Group expressed concern over efforts to skew the balance heavily in favour of the role of the private sector in supporting development, describing these as “unacceptable”, as they effectively amount to trying to privatize delivery on the global development agenda. “In the context of a much-needed strengthened and scaled up global partnership for development, the private sector has a complementary role to play in supporting the implementation of the development agenda,” said India.

This has also been a continuous and consistent demand from civil society groups  worldwide.

On follow up and review, the G77 and China acknowledged the distinct nature of the two tracks and reiterated its firm view regarding the need for an intergovernmental follow up for the FfD process under the auspices of the General Assembly. On the other hand the Group recalled the central role of the High Level Political Forum (HLPF) in the follow up and review of the post-2015 Development Agenda, including commitments emanating from the Conference on Financing for Development, as complementary means of implementation for the SDGs. The G77 and China expressed their firm support to a follow up and review of the post-2015 Development Agenda “that encompass all the 17 Sustainable Development Goals in a balanced and integrated manner, while giving priority for the implementation of Goal 17 and the MOI, specific targets under the other SDGs, as their cross-cutting nature is critical to the implementation of the entire framework of goals”.

The G77 and China statement was later endorsed, by among others, the LDCs, CARICOM, AOSIS, as well as several Member States including Brazil, Nigeria, Costa Rica and Lebanon, who spoke on the first day.

CARICOM, represented by Belize, said that the post-2015 agenda and FfD are distinct in themselves, but should be understood together as sustainable development should be their purpose with the common point being the MOIs. The FfD should ensure that it addresses the mobilization of resources across the three dimensions of sustainable development keeping resource mobilization aligned to development objectives and it should integrate the principle or universality of the post-2015 agenda.

With particular reference to SIDS, the FfD outcomes should address the vulnerabilities and challenges of SIDS with special regard to resource mobilization. Appropriate emphasis is needed on a global partnership, balanced with the need for domestic resource mobilization. Climate finance requires its own MOIs, according to CARICOM, emphasizing the need for adequate financing for climate change and climate resilient development and the special needs of SIDS. CARICOM asked for distinct follow up and review mechanisms for the two processes.

Ecuador, speaking on behalf of the Community of Latin America and Caribbean Countries CELAC), said the Member States should commit to having sound policies such as in international tax cooperation, debt relief, capacity building, and technology transfer. The MOIs are a vital cross cutting aspect of the post 2015 agenda and this requires investment and coordinated efforts by Member States. CELAC stressed the need for a responsible approach in terms of partnerships, particularly in participation by the private sector. There must be transparency, monitoring, and accountability by all actors.

CELAC stressed that innovative financing for development is a complement to and not a substitute for financing for development. It believes in "investment in science and technology and in building capacity with women and men involved”. Underlining the importance of technology and infrastructure in sustainable development, CELAC said that technology transfer, knowledge building and capacity building are important.  Middle-income countries continue to have high levels of poverty and persistent inequality, and needs economic opportunity for which strategies must be developed within this framework.
The Maldives, on behalf of the Alliance of Small Island States (AOSIS) said that special focus must be placed on the diversity and particular needs of SIDs in all processes. “We recognize that challenges require a global partnership for development, trade, technology transfer”, the Group said.  While acknowledging that finances from all sources are important the Group underscored the critical importance of global international financing because the private sector, being under-developed in SIDs, is unable to provide adequate financing. Access to modern technology is also important so as to build knowledge capacity and increase the countries’ involvement in international trade. The statement also mentioned the particular challenge faced by SIDs in climate change and capabilities of data collection.

Benin, speaking on behalf of the Least Developed Countries (LDCs), underscored the need to reach meaningful deliverables so as to achieve meaningful results ad so the means of implementation must work with the ambitions of the development agenda. The LDCs made the very important point that we cannot go to Addis just to reconfirm commitments made years ago. In particular, the LDC’s recommended: 0.25% of ODA for LDCs, reserving 50% of aid for trade for LDCs, a debt moratorium for LDCs, allocation of 0.1% of ODA for the technology bank. In addition they asked for specific strategies to build the capacity of LDCs such as investment in infrastructure, an international support center for investment in LDCs, institution building and reform.

TONGA speaking on behalf of Pacific Small Island Developing States (PSIDs) said that while the FfD and MOI tracks must be considered together, they are yet distinct. The FfD text should be explicit about what is being supported and in particular, the MOI for the targets. The Group asked for special considerations for SIDS and underscored the need for a global partnership.

Zambia, on behalf of the Land Locked Developing Countries (LLDCs) said that the FfD should not limit the post-2015 agenda but rather reinforce MOI in the latter. A complementarity between the two processes is critical to the attainment of targets of LLDC States.

The FfD process, as one of the many components, should feed into MOI and should reflect specific needs of LLDCs which need financial and technical assistance and technology facilitation in order to overcome needs, for example, to include secure transport infrastructure for reducing trade costs. The LLDCs also need to build diverse production, build resilience to climate change and other economic and social shocks. MOI should cater to the specific needs of LLDCs such as timely predictable ODA, increased aid for trade and market access, increased foreign direct investment, increased technical assistance, innovative sources of funding, and increased public-private partnerships.

Brazil stressed on the need to ensure adequate means to implement the SDGs which are “balanced and indivisible”. It is important to note that Brazil, throughout the Session, and in presentations made at other parallel smaller meetings, has been highlighting the indivisibility of the SDGs and therefore the need to ensure that all goals and targets, including the MOIs, are implemented and none left behind. It emphasized that Goal 17 (stand alone on MOI) and MOI specific targets are part and parcel of the SDG framework and must not be left behind like Goal 8 of the MDGs.

Brazil also said that for an effective integration of FfD and the P2015 agenda, two elements are needed, namely, a clear understanding of what MOI are needed for the new agenda; and concrete mechanisms and policies such MOIs provide. The Addis Conference is not just a pledging process and must try for indicative pledges.

Brazil also stressed that the FfD and post-2015 processes must complement but not compete with other pledges in other processes. So for example, the Green Climate Fund (GCF) under the UNFCCC has renewed call for $100 billion per year by 2020, but these pledges must not count as ODA. Brazil highlighted the non-financial aspects of MOI ad said that MOI also goes beyond finance to cover technology development and dissemination. Need to deepen discussion on issues. Brazil pointed to the need for review and monitoring of both the frameworks under the High Level Political Forum (HLPF – the institutional follow up of Rio+20 that replaced the Commission on Sustainable Development). The new agenda includes important new aspects of sustainable development, such as health and sustainable production & consumption, it said.

Nepal asked for a complementarity between post-2015 and the FfD. Increased resource requirement will also lead to increased taxes and increased cost of development, which needs to be balanced by ODA and trade, it said. Access to markets and capacity building for market linkages and value chains must be supported at all levels. On climate change, Nepal has negligible contribution to causes of climate change but is facing impacts such as snow and glacier melting. Therefore Nepal should not be asked for internal resources and ODA for climate impact support.

Nicaragua said that the two processes should be made complementary. It pointed out that national development strategies are crucial for developing countries as they need additional resources and an international environment favorable to development, and that ODA must be marked specifically for LDCs and SIDs. Implementing the Monterrey consensus is essential. Real changes in the financial system, transfer of technology, capacity building and debt issues must be part of the post-2015 agenda. Developing countries need space to address social infrastructure. The new framework should be aligned to the needs of developing countries and look at resource mobilization and take account of shared responsibility.

The European Union (EU) statement pointed to the different views shared by several developed countries. The EU said the Addis work should be comprehensive and be able to address the full MOI for the SDGs and the post-2015 agenda. (This was in stark contrast to the position taken by the developing countries.)

The EU also agreed to the need to move from FfD to “financing for sustainable development” and said there is a need to clarify the relationship between Addis and the post-2015 development process, again saying that the Addis outcomes should be framed as the comprehensive MOI for the SDGs. The EU also expressed its support for a single process for review and monitoring of the two frameworks.

According to the EU, the Addis outcome should include the FfD framework covering all the goals and targets, including non-financial means. It recommended that the Addis outcome should be drafted in a way in which it can easily fit and be included in the post-2015 agenda. Another option is to agree in Addis that a condensed version of the outcome document be included in the post-2015 package, the EU suggested.

The United States of America (USA) said the FfD and post--2015 agenda have the same purpose which is to end poverty and the promotion of sustainable development as common goals. It said that previous week’s discussion (the second drafting session of the FfD) re-affirms the Monterrey Consensus and the Doha Declaration, and has also provided an agreement on domestic mobilisation and the combat of illicit finance. The USA argued that ODA must focus on those most in need and underscored the importance of capacity building, need for inclusion and gender equality. It acknowledged the wide calls for science, technology and data as key enablers for development to trigger the growth of knowledge based economies, and also pointed out that there are areas that need improvement.

Australia said that the Addis outcome must build on the Monterrey framework in order to succeed and must have a defined outcome on how to attain financing goals. In order to achieve the SDG outcomes, the Addis outcome document must have the MOIs, a simple monitoring and follow-up mechanism, and strengthen global partnership. Australia acknowledged that ODA has an important role to maximize impacts catalytically. A global partnership includes other actors, founded on mutual respect, trust, and to capitalize on expertise. Strong coordination and sequencing between the post-2015 and FfD-Addis process must form the MOI outcome, it said.

(Several other Member States presented their views on the first day of the joint post-2015/FfD session, which is covered by this article. The next few days covered discussions on technology and other content and process issues related to MOI and the Global Partnership for Development. See separate report on “Will ‘the wall’ be broken? – Discussion begins on Technology Facilitation Mechanism in Post-2015 Agenda”.)

(*With inputs from the Women’s Major Group at the UN.)