Development financing meeting gets under way in Spain

Leaders of many of the world’s nations, but not the United States, gathered Monday in Spain to tackle the growing gap between rich and poor nations and try to drum up the trillions of dollars needed to close it.

More than 70 world leaders and other delegates unanimously adopted the ‘Seville Commitment’ – named for the host city – which had previously been hammered out in the run-up to the meeting without changes. It said that delegates have agreed to launch “an ambitious package of reforms and actions to close the financing gap with urgency”.

The gathering was held while many countries face escalating debt burdens, declining investments, decreasing international aid, and increasing trade barriers. Still, there is hope that the world can address one of the most important global challenges: ensuring that all people have access to food, healthcare, education, and water.

“Financing is the engine of development. And right now, this engine is sputtering,” United Nations Secretary-General Antonio Guterres said in his opening comments at the four-day Financing for Development meeting being co-hosted by the UN and Spain.

The hosts said the meeting was an opportunity to close the staggering US$4 trillion annual financing gap to promote development, bring millions of people out of poverty, and help achieve the UN’s badly lagging Sustainable Development Goals for 2030.

Along with heads of state and government, representatives of international financial institutions, development banks, philanthropic organisations, the private sector, and civil society also attended.

The summit is an opportunity “for us to raise our voice in the face of those who seek to convince us that rivalry and competition will set the tone for humanity and for its future”, Spain’s Prime Minister Pedro Sánchez told delegates.

At the last preparatory meeting on June 17, the United States rejected the outcome document that had been negotiated for months by the UN’s 193 member nations and announced its withdrawal from the process and the Seville conference.

UN Deputy Secretary-General Amina Mohammed last week called the US withdrawal from the conference “unfortunate”, adding that after Seville, “we will engage again with the US and hope that we can make the case that they be part of the success of pulling millions of people out of poverty”.

The European Union and France also said that they were not going be dissuaded by the American-led turn towards unilateralism.

“Collective mobilisation can still work,” French President Emmanuel Macron said on Monday.

European Commission President Ursula von der Leyen reaffirmed the bloc’s commitment to development financing, saying, “Our commitment is here to stay.”

The Sevilla Commitment calls for a tripling of lending by multilateral development banks and scaling up of private financing by providing incentives for investing in critical areas like infrastructure. It also calls for reforms to help countries deal with rising debt.

Last year, 3.3 billion people were living in countries that pay more interest on their debts than they spend on health or education, and the number will increase to 3.4 billion people this year, according to Grynspan. Developing countries will pay US$947 billion to service debts this year, up from US$847 billion last year.

Angolan President Joao Lourenco, speaking for the African Group, said debt payments “consumes more resources than those allocated to health and education combined” for many countries.

At the June 17 meeting, acting US representative to the Economic and Social Council, Jonathan Shrier, said the text “crosses many of our red lines”, citing interference with the governance of international financial institutions, tripling the annual lending capacity of multilateral development banks and proposals envisioning a role for the UN in the global debt architecture.

Shrier also objected to proposals on trade, tax, and innovation, as well as language on a UN framework convention on international tax cooperation.

The United States was the world’s largest single founder of foreign aid before the Trump administration dismantled its main aid agency, the US Agency for International Development.

AP