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The United Nations (U.N.) is in Addis Ababa, Ethiopia from July 13 through July 16 at the Financing for Development summit discussing Sustainable Development Goals (SDGs). The eight U.N. Millennium Development Goals (MDGs) were met prior to their September expiration date and the U.N. has established 17 new SDGs that are aimed to be completed by 2030. According to The Nation, the International Monetary Fund (IMF) and Multilateral Banks (MDBs) announced their plans to provide $400 billion in financial support to Pakistan over the next three years to aid in pursuing these goals. However, individuals such as Lucie Watrinet, who is with the French development NGO, CCFD-Terre Solidaire, has expressed concerns about issues related to commercial investments and tax evasion as this aid is dispersed.
Ban Ki-moon, United Nations Secretary-General, explained to thousands attending the finance summit in Ethiopia, “Let us put aside what divides us and overcome narrow self-interest in favour of working together for the common well-being of humanity.” Ki-moon is asking 190 nations to help in financing the 17 SDGs that are estimated by the U.N. Conference and Trade and Development to range in cost between $3.3 to $4.5 trillion a year over the next 15 years. The $400 billion that has been reported to be provided to Pakistan by the IMF and MDBs, like the World Bank Group, is a good show of the cooperation to come. This type of international cooperation will be needed if these goals are to be met.
In emphasising the challenge ahead President of the World Bank Group, Jim Yong Kim, explains, “We need trillions, not billions, of dollars, to accomplish these goals, and money will come from many sources: developing countries, private sector investment, donors, and international financial institutions.” The 17 SDGs are planned to be officially adopted in New York in October. The Capital of Ethiopia is an appropriate location for the Financing for Development summit. According to GlobalPost, Africa holds “33 out of the world’s 49 least developed countries,” but after investment in public services and in infrastructure, Addis Ababa is becoming a “model for development.”
Individuals like Lucie Watrinet with CCFD-Terre Solidaire and policy specialist Gail Hurley with the United Nations Development Programme have concerns surrounding how the money is financed and who should be the recipients of aid. International tax law enables financial institutions to avoid paying taxes that end up costing developing nations over $100 billion each year. Indeed, the issue of tax evasion by multinational organizations is a concern for the U.N. Another issue is holding nations to spend the agreed upon “0.7 percent of their wealth” to development aid which appears to be the exception and not the norm.
Hurley notes where the aid goes is becoming a greater concern with her investors. She says that her donors feel nations that have reached what might be called the status of “middle income” earners should be able to generate more income and should not require aid. There is also pressure on emerging economies like India and China to play a larger role in financing aid to developing countries.
The United Nations Financing for Development summit in Ethiopia is setting the tone for this next round of global developmental goals that will be formally adopted in October. United Nations Secretary General Ki-moon has set his sights on trying to supply better social programs, encouraging a better transfer of technology, and funding infrastructure in the neediest countries. As more international financial institutions participate in globalizing the market, such as aiding developing countries, the United Nations and Oxfam will continue to address financial regulations.
By Joel Wickwire
Global Post – “Key global development summit to open in Ethiopia”
Reuters – “Leaders must put aside “narrow self-interest” to end poverty says Ba Ki-mooon”
The Nation – “$400 IMF financing plan to help meet SDGs”
Photo Attributed to USAID U.S. Agency for International Development’s Flickr Page – Creative Commons Flickr License
Photo Attributed to John Gillespie’s Flickr Page – Creative Commons Flickr License