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New Straits Times
12 hours ago
- Business
- New Straits Times
UN bids to salvage global development summit after US boycott
SCORES of world leaders will be sweltering in the summer sun of southern Spain starting Monday at a once-a-decade United Nations development financing summit aimed at curbing global poverty, disease and the worst-case threats of climate change. Despite the scorching temperatures, though, a major chill looms over the event - the decision early this month by the United States, traditionally the world's largest aid giver and key finance provider, not to show up. UN countries want to close a US$4 trillion-a-year funding gap they now estimate prevents the developing world achieving the organisation's Sustainable Development Goals that range from cutting infant death rates to minimising global warming. UN Financing for Development summit starts from today. June 30 till July 3. Critics say the promises at the heart of the conference - called the "Seville Commitment" - are nowhere near bold enough. The measures, agreed by consensus after a year of tough negotiations, include tripling multilateral lending capacity, debt relief, a push to boost tax-to-GDP ratios to at least 15 per cent, and shifting special IMF money to countries that need it most. The run-up, however, has been marred by the US decision to withdraw over what it said was the crossing of a number of its red lines, including the push to triple development bank lending, change tax rules and the use of the term "gender" in summit wording. The European Union only joined the summit with reservations, particularly over how debt is discussed within the UN. Speaking to reporters this week, UN Deputy Secretary-General Amina Mohammed described Washington's boycott as "regrettable", especially after its "catastrophic" recent aid cuts that she said had cost lives and livelihoods. Speaking alongside officials from summit host Spain and Zambia, which has helped organise it, she said the final outcome document agreed reflected both "ambition and realism" and that the UN would try to re-engage the US afterwards. Remy Rioux, chief executive officer of the French Development Agency, said Washington's withdrawal had not been a total surprise given Donald Trump's views. The hope is that agreements next week will allow bolder action at the UN climate talks in Brazil in November. "We will push for the new framework... (and) its operationalisation from Seville to Belem," he added, referring to the Brazilian city that will host COP30. Other measures to be announced include multilateral lenders automatically giving vulnerable countries the option to insert repayment break clauses into their loans in case of hurricane, drought or flood. Another buzz phrase will be a "Global SDR playbook" - a plan where the wealthiest countries rechannel the IMF's reserve-like Special Draw Rights they hold to the multilateral banks, who then leverage them as capital in order to lend more. Campaigners warn that it will fall far short of what is needed, especially as more than 130 countries now face critically high debt levels and many spend more on repayments than on health or education. Aid and support from rich countries, who themselves have rising debts, is dropping too. In March, the US slashed more than 80 per cent of programmes at its USAID agency following federal budget cuts spearheaded by billionaire Elon Musk. Britain, France, Germany, the Netherlands and Sweden have all made cuts in recent years too. The OECD projects a 9-17 per cent drop in net official development assistance (ODA) in 2025, following a 9 per cent decline in 2024. It looks set to hit the poorest countries hardest: bilateral ODA to least developed countries and sub-Saharan Africa may fall by 13-25 per cent and 16-28 per cent respectively, the OECD estimates, and health funding could drop by up to 60 per cent from its 2022 peak. So what would be a good outcome in Seville, especially given the US pull-out? "We should make sure we are not backtracking at this point," said Orville Grey at the International Institute for Sustainable Development, referring to funding commitments. "We should at least remain stable."
Scoop
a day ago
- Business
- Scoop
Hope Renewed For Keeping The Promise Of The SDGs As World Leaders Head To Sevilla For The FFD4
4th International Conference on Financing for Development, June 30-July 3 New York, 25 June 2025 – Amid mounting debt burdens and declining investment, to reduced aid and growing trade barriers, world leaders will gather in Sevilla next week for the Fourth International Conference on Financing for Development (FFD4). Access to food, health, education and water provides communities around the world a path out of poverty. But billions of people live in countries that pay more in interest on debt than on health or education. Against this backdrop, the high-level gathering marks a pivotal moment for the international community to reaffirm that the ambition and commitments made to sustainable development in the landmark 2015 Addis Ababa Action Agenda, remain strong; that international cooperation is delivering progress and action; and that the promise of the Sustainable Development Goals (SDGs) endures. Speaking at a press briefing today, UN Deputy Secretary-General Amina Mohammed stressed the need for immediate action, 'A decade after world leaders embraced the 2030 Agenda and the Addis Ababa Action Agenda, we remain off course – the system is failing those it was meant to uplift. 'But Sevilla offers a chance to change course – to catalyze investment, address the debt and sustainable development crisis, and reform the rules of the system to put people's needs at the center,' she added. 'It sends a powerful message to the world that despite persistent headwinds, international cooperation is delivering progress and there is renewed hope in keeping alive the promise of the SDGs.' In his remarks at the press briefing, Ambassador Héctor Gómez Hernández, Permanent Representative of Spain to the United Nations highlighted, 'This conference is an appeal to action and we have the extraordinary opportunity to send a very strong message to defend the international community's commitment to multilateralism.' In Sevilla, the global community will formally agree to a range of actions that advance the financing for development agenda. To unlock investment, member states will double support for mobilizing domestic resources, triple lending by Multilateral Development Banks, and remove constraints to private capital in frontier markets. To address the debt crisis, new initiatives will be launched to scale up debt swaps and debt pause clauses, and a borrowers' forum will be established to share experience and coordinate approaches. To create a fairer financial system, member states will advance efforts to give developing countries greater voice in decision-making and call for a review of the role of Special Drawing Rights that assist countries in emergencies. Co-facilitator of the negotiation process, Ambassador Chola Milambo, Permanent Representative of Zambia to the United Nations noted that the negotiated outcome document sent a message of hope to the world, 'That we can tackle the financial challenges that stand in the way of the SDGs and that multilateralism can still work.' From Sevilla to the upcoming G20 Summit in Johannesburg, momentum is building to deliver solutions across debt, trade, financing and investment in support of the 2030 Agenda. About FFD4 The Fourth International Conference on Financing for Development (FFD4), to take place in Sevilla, Spain, from 30 June to 3 July 2025, will bring together world leaders to advance solutions to financing challenges threatening the achievement of sustainable development. Governments, international organizations, financial institutions, businesses and civil society will commit to financing our future through a renewed global framework for financing for development. The Conference is expected to adopt the Compromiso de Sevilla, an intergovernmentally negotiated outcome, which was approved for adoption by consensus at the Fourth Preparatory Committee Meeting for FFD4 (17 June 2025). The Conference will mark the beginning of implementation of the outcome document, signaling a new phase of collective action on financing for development. Coalitions of countries and diverse stakeholders will announce ambitious commitments and solutions under the Sevilla Platform for Action that will operationalize the renewed financing framework and move from dialogue to delivery.
The Star
2 days ago
- Business
- The Star
UN bids to salvage global development summit after US boycott
MADRID/LONDON (Reuters) -Scores of world leaders will be sweltering in the summer sun of southern Spain next week at a once-a-decade United Nations development financing summit aimed at curbing global poverty, disease and the worst-case threats of climate change. Despite the scorching temperatures, though, a major chill looms over the event - the decision early this month by the United States, traditionally the world's largest aid giver and key finance provider, not to show up. UN countries want to close a $4 trillion-a-year funding gap they now estimate prevents the developing world achieving the organisation's Sustainable Development Goals that range from cutting infant death rates to minimising global warming. Critics say the promises at the heart of the conference - called the "Seville Commitment" - are nowhere near bold enough. The measures, agreed by consensus after a year of tough negotiations, include tripling multilateral lending capacity, debt relief, a push to boost tax-to-GDP ratios to at least 15%, and shifting special IMF money to countries that need it most. The run-up, however, has been marred by the U.S. decision to withdraw over what it said was the crossing of a number of its red lines, including the push to triple development bank lending, change tax rules and the use of the term "gender" in summit wording. The European Union only joined the summit with reservations, particularly over how debt is discussed within the UN. Speaking to reporters this week, U.N. Deputy Secretary-General Amina Mohammed described Washington's boycott as "regrettable", especially after its "catastrophic" recent aid cuts that she said had cost lives and livelihoods. Speaking alongside officials from summit host Spain and Zambia, which has helped organise it, she said the final outcome document agreed reflected both "ambition and realism" and that the U.N. would try to re-engage the U.S. afterwards. Remy Rioux, chief executive officer of the French Development Agency, said Washington's withdrawal had not been a total surprise given Donald Trump's views. The hope is that agreements next week will allow bolder action at the UN climate talks in Brazil in November. "We will push for the new framework... (and) its operationalisation from Seville to Belem," he added, referring to the Brazilian city that will host COP30. AID IN DECLINE Other measures to be announced include multilateral lenders automatically giving vulnerable countries the option to insert repayment break clauses into their loans in case of hurricane, drought or flood. Another buzz phrase will be a "Global SDR playbook" - a plan where the wealthiest countries rechannel the IMF's reserve-like Special Draw Rights they hold to the multilateral banks, who then leverage them as capital in order to lend more. Campaigners warn that it will fall far short of what is needed, especially as more than 130 countries now face critically high debt levels and many spend more on repayments than on health or education. Aid and support from rich countries, who themselves have rising debts, is dropping too. In March, the U.S. slashed more than 80% of programmes at its USAID agency following federal budget cuts spearheaded by billionaire Elon Musk. Britain, France, Germany, the Netherlands and Sweden have all made cuts in recent years too. The OECD projects a 9–17% drop in net official development assistance (ODA) in 2025, following a 9% decline in 2024. It looks set to hit the poorest countries hardest: bilateral ODA to least developed countries and sub-Saharan Africa may fall by 13-25% and 16-28% respectively, the OECD estimates, and health funding could drop by up to 60% from its 2022 peak. So what would be a good outcome in Seville, especially given the U.S. pull-out? "We should make sure we are not backtracking at this point," said Orville Grey at the International Institute for Sustainable Development, referring to funding commitments. "We should at least remain stable." (Reporting by David Latona in Madrid and Marc Jones in London, additional reporting by Simon Jessop in London; Editing by Andrew Heavens)
Straits Times
3 days ago
- Business
- Straits Times
Explainer-What is the UN's development conference in Seville, and what can it achieve?
FILE PHOTO: World Bank President Ajay Banga attends the Milken Institute Global Conference 2025 in Beverly Hills, California, U.S., May 5, 2025. REUTERS/Mike Blake/File Photo FILE PHOTO: Nigeria's Amina Mohammed, Deputy Secretary-General of the United Nations, looks on during the official opening of the World Economic Forum on Africa in Cape Town, South Africa September 5, 2019. REUTERS/Sumaya Hisham/File Photo Explainer-What is the UN's development conference in Seville, and what can it achieve? LONDON - Global leaders will kick off the once-a-decade Conference on Financing for Development (FFD4) in Seville, Spain, on Monday, which aims to improve the world's aid and financial architecture. Ambitious reforms to everything from global tax to climate-focused funding are on the agenda. What is the event, who will attend, and what can it achieve? WHAT IS IT? The fourth such conference brings together political, financial and trade leaders to formulate a coherent approach to issues bedevilling global development - from aid to trade to debt. Leaders will formally adopt a 38-page document - dubbed the "Seville Commitment" - which was painstakingly negotiated and agreed prior to the event. It will be a blueprint for development financing for the coming decade, but it is a political commitment, rather than a legally binding agreement. The first FFD's "Monterrey Consensus" in 2002 produced targets for rich countries to spend 0.7% of gross national product on official development assistance and supported the Heavily Indebted Poor Countries Initiative, which eventually yielded billions in debt relief. The last FFD, in Addis Ababa in 2015, produced the 17 sustainable development goals that have guided multilateral funding for the past decade, and focused attention on strengthening taxation and stemming illicit financial flows. This year's backdrop is particularly challenging, with widespread aid cuts across the rich world - and climate change scepticism from U.S. President Donald Trump. WHAT ARE THIS YEAR'S OBJECTIVES? The Seville Commitment focuses on reforms to help poor nations adapt to climate crises, such as debt swaps, natural disasters debt pause clauses and an exploration of "global solidarity levies", which could tax highly polluting activities - or the super-rich - to finance sustainable development. It also targets progress towards better debt restructuring frameworks and innovations to boost funding, such as multilateral development banks' efforts to leverage special drawing rights. Leaders will also launch the Seville Platform for Action, which would form alliances to expedite concrete progress on the goals. WHO WILL BE THERE? UN Deputy Secretary-General Amina Mohammed said on Wednesday that more than 70 heads of state and government would attend. They include French President Emmanuel Macron, South African President Cyril Ramaphosa - this year's G20 chair - and sustainable finance rock stars such as Barbados Prime Minister Mia Mottley. World Bank President Ajay Banga is expected, along with development bank chiefs, the Gates Foundation and other campaign groups. Notably absent, however, is the United States, which withdrew during negotiations after it tried, unsuccessfully, to strip climate, sustainability and gender equality from the Seville Commitment. WHAT IMPACT COULD IT HAVE? The U.S. absence, and continued discord over the approach to certain other issues, such as debt, could hobble the event's impact. Trump's opposition to goals such as global tax rule changes could make success on that subject tougher. Meanwhile, disagreements between African leaders and key lending nations, such as China, over a debt convention also bedevil substantive progress. But sources said the event could be more successful without U.S. attendees trying to water down objectives, and there is a strong consensus that the world must take urgent action on issues such as climate adaptation funding. WHAT IS THE BACKDROP? The U.N. pegs the global financing gap for sustainable development at a whopping $4 trillion. Multilateral lenders are working to boost funding - but the cash they have been able to mobilise thus far is in the hundreds of billions, not trillions. At the same time, the average interest costs for developing countries as a share of tax revenues nearly doubled since 2014. China's lending to Africa has turned net negative as loan repayments come due, and an estimated 3.3 billion people - and more than half of Africans - live in countries that spend more on debt than health. REUTERS Join ST's Telegram channel and get the latest breaking news delivered to you.
Reuters
3 days ago
- Business
- Reuters
Explainer: What is the UN's development conference in Seville, and what can it achieve?
LONDON, June 26 (Reuters) - Global leaders will kick off the once-a-decade Conference on Financing for Development (FFD4) in Seville, Spain, on Monday, which aims to improve the world's aid and financial architecture. Ambitious reforms to everything from global tax to climate-focused funding are on the agenda. What is the event, who will attend, and what can it achieve? The fourth such conference brings together political, financial and trade leaders to formulate a coherent approach to issues bedevilling global development - from aid to trade to debt. Leaders will formally adopt a 38-page document, opens new tab - dubbed the "Seville Commitment" - which was painstakingly negotiated and agreed prior to the event. It will be a blueprint for development financing for the coming decade, but it is a political commitment, rather than a legally binding agreement. The first FFD's "Monterrey Consensus" in 2002 produced targets for rich countries to spend 0.7% of gross national product on official development assistance and supported the Heavily Indebted Poor Countries Initiative, which eventually yielded billions in debt relief. The last FFD, in Addis Ababa in 2015, produced the 17 sustainable development goals that have guided multilateral funding for the past decade, and focused attention on strengthening taxation and stemming illicit financial flows. This year's backdrop is particularly challenging, with widespread aid cuts across the rich world - and climate change scepticism from U.S. President Donald Trump. The Seville Commitment focuses on reforms to help poor nations adapt to climate crises, such as debt swaps, natural disasters debt pause clauses and an exploration of "global solidarity levies", which could tax highly polluting activities - or the super-rich - to finance sustainable development. It also targets progress towards better debt restructuring frameworks and innovations to boost funding, such as multilateral development banks' efforts to leverage special drawing rights. Leaders will also launch the Seville Platform for Action, which would form alliances to expedite concrete progress on the goals. UN Deputy Secretary-General Amina Mohammed said on Wednesday that more than 70 heads of state and government would attend. They include French President Emmanuel Macron, South African President Cyril Ramaphosa - this year's G20 chair - and sustainable finance rock stars such as Barbados Prime Minister Mia Mottley. World Bank President Ajay Banga is expected, along with development bank chiefs, the Gates Foundation and other campaign groups. Notably absent, however, is the United States, which withdrew during negotiations, opens new tab after it tried, unsuccessfully, to strip climate, sustainability and gender equality from the Seville Commitment. The U.S. absence, and continued discord over the approach to certain other issues, such as debt, could hobble the event's impact. Trump's opposition to goals such as global tax rule changes could make success on that subject tougher. Meanwhile, disagreements between African leaders and key lending nations, such as China, over a debt convention also bedevil substantive progress. But sources said the event could be more successful without U.S. attendees trying to water down objectives, and there is a strong consensus that the world must take urgent action on issues such as climate adaptation funding. The U.N. pegs the global financing gap for sustainable development at a whopping $4 trillion. Multilateral lenders are working to boost funding - but the cash they have been able to mobilise thus far is in the hundreds of billions, not trillions. At the same time, the average interest costs for developing countries as a share of tax revenues nearly doubled since 2014. China's lending to Africa has turned net negative as loan repayments come due, and an estimated 3.3 billion people - and more than half of Africans - live in countries that spend more on debt than health.
