Latin American and Caribbean Government Officials and Experts Call for Rethinking the Architecture of Financing for Development

Santiago, March 13, 2015.- Authorities and ministers from several countries in the region, as well as senior representatives from the United Nations, said that it is necessary to rethink the international financial architecture and put inclusion at the center of the new post-2015 development agenda, in the context of a meeting on financing for development held at the headquarters of the Economic Commission for Latin America and the Caribbean (ECLAC) in Santiago, Chile.

In the Latin American and Caribbean Regional Consultation on Financing for Development, organized by ECLAC and Chile’s government, which is taking place on March 12-13, participants discuss the extent of progress on the final document of the Third International Conference on Financing for Development, which will be held in July in Addis Ababa, Ethiopia.

In this global meeting it is expected that heads of state and other senior representatives from the international community negotiate an intergovernmental accord for the implementation of the post-2015 development agenda, that not only includes financing for development, but also other issues related to the means of implementation, among them the closing the commercial, financial and technological gaps between developed and developing countries.

The Regional Consultation was inaugurated by Heraldo Muñoz, Chile’s Minister of Foreign Affairs; Wu Hongbo, the United Nations Under-Secretary-General for Economic and Social Affairs; Jessica Faieta, Director for Latin America and the Caribbean of the United Nations Development Program (UNDP); and Alicia Bárcena, ECLAC’s Executive Secretary.

During his speech, Minister Muñoz underlined the importance of this meeting, which will allow the region to take inclusive proposals for sustainable development with equality to the Third International Conference in Addis Ababa. “The heart of the new development agenda must be inclusion, integrating environmental, social and economic dimensions,” he said.

Wu Hongbo emphasized the relevance of this meeting in preparation for the Third International Conference. “The Addis Ababa Conference is an opportunity to spell out this comprehensive framework for implementation of the sustainable development agenda and the SDGs, and can also lay the groundwork for an ambitious agreement on climate in Paris in December (during the Conference of the Parties of the United Nations Framework Convention on Climate Change-COP 21),” the senior United Nations official said.

Jessica Faieta stressed that the Regional Consultation will facilitate building a Latin American and Caribbean perspective on financing for development. “The post-2015 agenda will not be financially viable with official development assistance (ODA) or national public finances alone. Private investment must also contribute to the sustainable development goals (SDGs),” she said.

In her opening remarks, Alicia Bárcena insisted that the Third Conference in Addis Ababa represents a unique occasion to address the challenges of middle-income countries (such as those in Latin America and the Caribbean), to deploy effective financing at all income levels, and to redefine the global financial and trade architecture for development.

“We must forge a new strategic association among all the world’s countries and especially in Latin America we must advance towards equality, transforming our productive structure in an environmentally sustainable way,” Bárcena stressed.

Bárcena also referred to the efforts of mobilizing domestic resources by improving tax collection and reducing external debt. She also stressed some challenges, like pursuing greater symmetry and fairness in global tax systems and the global financing governance, and the closure of trade gaps.

During the Regional Consultation, ECLAC will present some strategic features of financing for development from a regional perspective, on the basis of a new study entitled Financing for development in Latin America and the Caribbean: A strategic analysis from a middle-income country perspective.

This document examines the role of traditional sources of financing for development in the region, especially ODA, foreign direct investment (FDI) and countries’ domestic resources, as well as the importance of tackling with tax evasion and illicit funds. It emphasizes that achieving the post-2015 agenda goals will necessitate the use of both public and private resources and the incorporation of innovative mechanisms and new forms of cooperation that enable reform of the current financial architecture for development.