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Info Service on UN Sustainable Development (May25/04) Yerevan, 29 Apr (D. Ravi Kanth) — The United Nations Secretary-General, Mr Antonio Guterres, on 28 April urged countries not to “let our financing for development ambitions get swept away” against the backdrop of the worsening trade war that has hit “the most vulnerable countries and people” the hardest. In a hard-hitting statement delivered at the “ECOSOC Forum on Financing for Development Follow-Up” in New York on 28 April, a seemingly worried SG spoke his mind on several “harsh truths” staring in the face of the international community that have seemingly taken an ugly turn after the Trump administration simply walked out of its financing commitments. Though the SG did not mention the Trump administration in his statement, much of his remarks seem to be directed against the current positions of the US as regards climate change, the Sustainable Development Goals (SDGs), and debt financing among others, said people familiar with his statement. The Fourth International Conference on Financing for Development is expected to take place in Sevilla, Spain from 30 June to 3 July 2025. “HARSH TRUTHS” In the final leg of preparations for the Sevilla conference, the UN SG reminded countries about the “harsh truths” confronting the conference. According to the SG, the first harsh truth is that “the Sustainable Development Goals (SDGs) are dramatically off track, exacerbated by an annual financing gap of an estimated $4 trillion.” The second harsh truth is the prevailing “high borrowing costs that are draining away public investments in everything from education and health systems, to social protection, infrastructure and the energy transition.” But the “more dangerous” harsh truth underlying all these challenges is “that global collaboration is being actively questioned. Look no further than trade wars.” The SG pointed out that fair trade, which is a sine qua non for sharing benefits and fostering “international cooperation”, is being severely undermined. “And trade barriers are a clear and present danger to the global economy and sustainable development – as demonstrated in recent sharply lower forecasts by the International Monetary Fund, United Nations Conference on Trade and Development (UNCTAD), World Trade Organization and many others,” he said. “In a trade war, everybody loses – especially the most vulnerable countries and people, who are hit the hardest,” the SG grimly noted. Mr Guterres said, “Against this turbulent background, we cannot let our financing for development ambitions get swept away.” “With just five years to reach the Sustainable Development Goals, we need to shift into overdrive,” the UN chief emphasised. Mr Guterres said this includes “making good on the commitments countries made in the Pact for the Future in September 2024: From an SDG stimulus to help countries invest in their people; to vital and long-awaited reforms to the global financial architecture; to the Pact’s clear commitments to open, fair and rules-based trade; to its call for an analysis of the impact of military expenditures on the achievement of the SDGs, with a final report out by September; and to the Pact’s urging for an ambitious outcome to July’s Conference on Financing for Development.” He told the countries that “as you continue negotiations on the draft outcome document for Sevilla, I push for action in three key areas.” First, on debt, he said, “When applied smartly and fairly, debt can be an ally of development.” “Instead, it has become a villain,” he lamented. He said, “in many developing countries, gains are getting crushed under the weight of debt service, siphoning away investments in education, health and infrastructure.” Suggesting that the problem is “getting worse,” the UN chief said that debt service for developing economies has soared past $1.4 trillion a year. He noted that the “debt service now exceeds 10 per cent of government revenue in more than 50 developing countries – and more than 20 per cent in 17 countries – a clear warning sign of default.” The Sevilla Conference, the SG said, “should emerge with a commitment by Member States to lower the cost of borrowing, improve debt restructuring, and prevent crises from taking hold.” Further, he said it should include “establishing a dedicated facility to help developing countries manage their liabilities and enhance liquidity in times of crisis.” The SG wants the G20 to play its role by speeding up “the Common Framework for Debt Treatments and expand support for countries that are currently ineligible – including middle-income countries in difficulties.” He emphasized that the “credit ratings agencies need to rethink ratings methodologies that drive up borrowing costs for developing countries.” The SG said, “The IMF and World Bank should push forward on reforming debt assessments to account for sustainable development investments and climate risks.” He suggested that these proposals and the many others contained in the draft outcome document provide an ambitious roadmap to help developing countries use debt in a constructive and sustainable way. Second, “we need to unlock the full potential of our international financial institutions.” “If finance is the fuel of development, Multilateral Development Banks are its engine,” he said, adding that “this engine needs revving up.” He underscored the need for ensuring that “concessional finance is deployed where it is most needed.” Lastly, the UN chief called for ensuring that “developing countries are represented fairly – and have a voice – in the governance of these institutions they depend on.” +
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