Developing nations risk falling behind due to global economic crisis – UN officials
“Fragilities in the global economy, including the risk of spillovers from developed countries, reversals in private capital inflows, exchange rate misalignments and commodity price volatility, continue to hamper [developing countries’] growth prospects,” said President of the General Assembly Nassir Abdulaziz Al-Nasser in his remarks to the Fifth High-level Dialogue on Financing for Development in New York.
In his message, delivered on his behalf by Assembly Vice President Gary Quinlan, Permanent Representative of Australia, Mr. Al-Nasser said that given the current economic environment, it is “critical that developing countries undertake measures to address poverty and expand productive employment opportunities,” but that to do this they will require considerable levels of external assistance.
Mr. Al-Nasser stressed that the current economic downturn will adversely affect foreign direct investment (FDI) flows to developing countries as well as private capital investment, having a potentially destabilizing effect in their economies.
He also asked countries to address the imbalances on the trade system, as “the development potential of international trade continues to be limited by a wide range of tariff and non-tariff restrictions as well as agricultural subsidies in developed countries,” and said it is imperative to arrive at a successful conclusion to the Doha Round of multilateral trade negotiations, which have been stalled over such issues as removing agricultural subsidies in developed countries and trade barriers that impede the least developed countries’ (LDCs) efforts to market their produce.
“After almost a decade of multilateral trade negotiations, the share of LDCs in world trade remains extremely low. It is important for the international community to deliver on our promise to provide duty-free and quota-free access for all products originating from LDCs,” he said.
Mr. Al-Nasser said the two-day event provides countries with the opportunity to build up on previous trade agreements and prepare the ground for future negotiations.
Deputy Secretary-General Asha-Rose Migiro, echoed Mr. Al-Nasser’s remarks adding that developing countries face a “vicious cycle of slow growth, low revenue and high debt.”
Ms. Migiro said developing countries are in need of additional assistance to be able to cope with the impact of the crisis, yet most donor countries are tightening their budgets.
“We cannot allow the economic crisis to deflect us from our commitment to the world’s poorest people. Development cooperation is not charity; it is smart investment in security and prosperity.
“While government budgets are tight, we also have to find new ways to complement and strengthen traditional aid,” she said.
She also emphasized the importance of ensuring that the spillover effects from debt crises in developed countries do not jeopardize debt sustainability in developing countries.
“Fresh efforts are needed to extend debt relief to the poorest and most vulnerable countries – and, more broadly, to explore how to deal with debt distress more effectively and fairly,” she said.