As austerity conditions are imposed on governments in exchange for loans, and fiscal space narrows further, we are forced to trade off people’s well-being for creditworthiness, by continuing debt service payments. These come with harsh gendered spillovers, borne even more heavily by women who already face discrimination, oppression and violence in their daily lives. 

Women carry a much heavier share of unvalued, unrecognized and unpaid, but socially and economically vital care work. They are also usually tracked into the lower rungs of the services sector which are deemed unskilled labor and thus, poorly paid. Debt conditionalities such as privatization of health and water stand in the way of budgeting for adequate, affordable and quality public services which can make a big difference in helping women.

Debt cancellation, starting with illegitimate debts, is a decisive step towards a just recovery, and a gender-just and sustainable economic rebuilding. 

#DebtJustice for #GenderJustice and #ClimateJustice now. 

#CancelTheDebt #IWM2022 

READ MORE: APMDD's Message for #IWD2022

APMDD holds forum on “Women’s Voices for Tax Justice: Women, Mining and Climate”

 

As part of the Global Days of Action for Tax Justice for Women’s Rights, APMDD and TAFJA held an online forum on 24 March 2022 to listen to women’s voices for tax justice and explore how mining and illicit financial flows impact on women’s rights and resilience in the face of an alarming climate crisis.

APMDD coordinator, Lidy Nacpil, called mining, climate, and illicit financial flows a ”triple whammy on women”. She said most of the countries of the South have extractivist economies as a legacy of the colonial past. 

“The continuous extraction affects local communities where mines operate with pollution and extraction of resources during the course of mining… But certain types of extraction affect even far away communities. That is in the impact on climate, especially the continues extraction, production and consumption of fossil fuels which is responsible for 75 percent of global greenhouse emissions that has triggered and is escalating global warming and climate change.”  

She emphasized that fighting for tax justice in extractives is not an easy fix. “Extraction has to be done in ways that economies will benefit but the environment is not destroyed. We need to stop the current tax incentives given to mining companies which encourage them. We need to punish, penalize, drive away these foreign mining companies, who do not only abuse countries’ environments, but their own workers,” she said.

“The climate crisis tells us we cannot take too long to take action. Policy changes are urgent. We need to work hard and fast,” Nacpil said, stressing the importance of women “who won’t stop at nothing to protect their children” in the fight.  

Hoang Phuong Thao of Action Aid Vietnam noted the need to “unpack the reality of how inequality has increased significantly through the multiple crises that we have gone though in the past few years, and especially the crises of climate change and COVID -- and the reality that governments are trading off citizen’s rights for the benefit and profit of corporates."

“In the race to the bottom, ASEAN countries are trying to reduce corporate income tax to attract investments, with the hope that the trickle-down effect will turn into employment. But in fact our people -- especially our women, our women workers -- are suffering from loss of lands and livelihoods because of waters rising, suffering being pushed out of the labor market, becoming informal workers, becoming workers that have no protection,” she said. 

Perspectives of women in mining-affected communities and gendered impacts of extractivist activities were discussed by Fara Diva Gamalo of the Freedom from Debt Coalition-Philippines and Srishty Anand of Oxfam-India.  Gamolo spoke of a community in Leyte province where hundreds of rice fields have been destroyed by Chinese mining company, extracting black sand and shipping it out to China, since 2010. “Not only livelihoods have been destroyed, but also fresh water sources are depleting because of the mining,” she said. 

Illicit financial flows in the extractives sector and impacts on women was discussed by Meliana Lumbantorua, a program manager of Published What You Pay Indonesia. “For Indonesia, tax is a dominant revenue source, but mining corporations have been using loopholes in tax laws for tax avoidance,” she said.   

“The current crises have been especially hard on women. We have to push those ‘status quo-ists’, the financial profiteers and profit shifters, those who listen only to the rich, and those fossilized defenders of fossil fuels, to move towards cleaner, greener, more sustainable alternatives and system change,” said Vidya Dinker of the India Social Action Forum. 

“We honor women who continue to lead the fight against mining and many fights for tax and gender justice, for climate justice. Women who, despite being marginalised from decision making in all spheres of life, including on financial matters, demand transparency, accountability and inclusiveness in financial systems, and are also in the frontlines of crafting transformative economic visions beyond extractivist economies,” Jeannie Manipon, APMDD Development Finance program manager, said at the conclusion of the forum. 

See video of the forum here

 

SEA civil society groups resolve to advance advocacies for tax justice and the rights of workers, farmers, and women

 

Worsening inequality and climate impacts, unfair trade and global value chains, flawed tax systems and inadequate revenues to finance post-COVID recovery were tackled at a regional workshop organized by the Asian Peoples’ Movement on Debt and Development (APMDD) and Perkempulaan Prakarsa on 23-25 March 2022 in Bali, Indonesia. Participants from civil society groups in Southeast Asia resolved to strengthen their actions and collaborative campaigns for economic justice in the lead up to the G20 Summit slated to take place in November. 

It was the first face-to-face civil society gathering convened by the APMDD and the Prakarsa under the banner of the Tax and Fiscal Justice-Asia (TAFJA) since the pandemic lockdowns in 2020. Close to 30 participants from Indonesia, Malaysia, the Philippines, Thailand, and Vietnam attended the workshop. 

Ah Maftuchan, Prakarsa executive director, said that CSOs should seize various opportunities to continue the momentum of campaigning for economic justice. He noted that the Summit of the G20 or Group of 20 in November this year in Indonesia and in India in 2023 would be important advocacy moments.  Prakarsa is in the leadership of Civil 20 (C20), a civil society platform to engage the G20 in political dialogue.  

Lidy Nacpil, APMDD coordinator, said the current multiple crises that encompass health, food, financial, and climate crises challenge advocates to step up our campaigns for economic and climate justice.  “The scale of relief needed, especially by those deeply affected economically, requires multi-government agencies to mobilize for the needs of people. Unfortunately, most proposals have not moved away from the usual ‘capital access’ and low-interest loans.”  

Proposed solutions follow the current and flawed logic of the global economic system, Nacpil pointed out. “The major failure of this usual approach is that a bigger part of the wealth flows to richer northern countries, while the resources of poorer nations continue to be exploited… Recovery is being used by those exploiting the global system. What we need are genuine rebuilding and transformation,” she said. Nacpil cited the 15% minimum corporate tax proposed by the OECD in what they call the Two-Pillar Solution on Base Erosion and Profit Shifting” as an example of a false solution that does not benefit the peoples  of the Global South.  The OECD proposal is criticized by many CSOs as a ‘Tax Deal of the Rich’. 

The workshop  aimed to hone the campaigning skills of TAFJA members and other CSOs, and to contribute to shifting the discourse on tax incentives, ending the race to the bottom in  tax competition, curbing tax avoidance and evasion, and strengthening the advocacy  for increased resource allocation for  social protection and public services  especially for women.

Key Issues and Initiatives: Mapping Out Realities on the Ground

 

Through country presentations and mapping exercises, the participants shared about current initiatives and surfaced priority issues for campaigning. 

Dinda Nuur Anisaa Yura of Solidaritas Perempuan (Women's Solidarity of Human Rights) in Indonesia spoke of human rights concerns arising from ill-advised projects  that have resulted in environmental degradation. An example given by Yura is the Poso Hydro Power that early this year had announced support for the government’s effort for green energy. But, while the energy output is ‘clean’, the infrastructure construction has submerged farmlands which resulted in crop failures, endemic fish loss, loss of farmlands and food resources; and possible loss of cultural heritage. 

Elaborating on the gender dimensions and layered impacts of the issue, she said that environmental degradation and the potential for disaster adds to the burdens of women who have to care for family needs and manage natural resources at the community level. 

Mugheelan Sellathoray of the Monitoring Sustainability of Globalisation (MSN) in Malaysia spoke of the COVID lockdowns and the hardships suffered by frontliners, agriculture workers, migrant workers and those who lost their jobs.  Meanwhile, there are families who are not getting subsidies for online education or any assistance when family members contract COVID-19. He said the political instability in the country added to the tensions as partisan politics slowed the provision of social protection measures. 

Maricon Jesusco spoke about the Oriang women’s movement in the Philippines and its work on fighting inequality and women’s oppression. Oriang has led nationally coordinated actions to campaign for debt cancellation, tax justice, climate justice, and human rights. Reflecting on Oriang’s work in the province worst-hit by the 2013 Super Typhoon Haiyan, the strongest typhoon on record, she said that affected communities have not fully recovered and that rehabilitation assistance have mostly been extended to the business sector, not to the most vulnerable sectors. 

Movements in the Philippines have also been involved in legislative advocacy. Vicente Barlos of the progressive coalition Sanlakas spoke about their push for the repeal of a martial law-era law that provides  automatic appropriations for debt payments in the national budget. Another priority for Sanlakas is advocating for pro-worker reforms in the rules and regulations that govern recruitment and placement of industry workers by private employment. Sanlakas is also pushing for the adoption of a wealth tax, “buwis sa yaman, hindi sa kita” (tax on wealth, not just income). 

Ha Thi Chu of ActionAid Vietnam (AAV) noted that among the key developments in the country are Vietnam’s commitments to stop building coal power plants and to zero emission by 2050. A new wage regime is also planned for the public sector, including the care sector by 2023. The situation of unpaid care workers is an important indicator to monitor gender equality progress until 2030, she said. 

AAV, according to Ha Thi Chu, has several major advocacy actions and public campaigns for fair fiscal governance. AAV is advocating for the government to prioritize public welfare vs austerity measures, and for the Ministry of Finance to increase budget allocations for public health, prioritize the needs of people especially those in the informal workforce, and rebuild  the economy. Vaccine equality and climate justice are also important advocacies. In all these advocacies, she said it’s important to bring the  voices of peoples from the Global South, especially those excluded from negotiations like climate talks, to deliver a powerful message.  

Pham Van Long of the Viet Nam Center for Economic and Strategic Studies spoke of  ongoing research on the tax burdens of different sectors in Vietnam that will form the basis for the policy advocacy activities of the Vietnam Alliance of Tax Justice.  He said the core of the current state budget revenue is value-added tax, accounting for 33.27% of total tax revenues. The business tax rate is stipulated by law to be 20 percent, lower than the  21.7% average tax rate for Southeast Asian countries in 2020. “The tax burden in Vietnam is excessive and reforms are required to promote growth,” he said, adding that Vietnam is the lowest income country among similar countries in the ASEAN, but its share of tax revenue/GDP is the highest.

Participants surfaced other priority issues during a facilitated mapping exercise. Topping the list are: 

• hunger across sectors, and increasing demand for social care and social protection; worsening inequalities, and continuing male dominance especially in the agriculture industry; labor and workers’ issues including low minimum wage and vulnerabilities of migrant workers;

• inadequate domestic revenue to finance post-COVID recovery and need for alternative domestic revenues and fair tax-based solutions; debt trap of low and middle income countries and austerity conditions imposed; regressive taxation system; G20 proposed global minimum corporate tax; tax incentive competition; and

• exploitation of natural resources and impacts of climate change; the need for transparency, accountability and participation in climate finance,  and for just climate and energy transition.

 

Food, Agriculture, Trade, and Tax:  Value Chains and Fiscal Policy

 

This panel discussion underscored the importance of analyzing global value chains, especially in food and agriculture, to see how these shape the  economies of developing countries and impact on the situation of farmers and food producers. Resource persons of this session were Dati  Fatimah (Indonesia), Thanh Nguyen Duc, Ph.D.(Viet Nam), and Wanun Permpibul (Thailand) with Herni Ramdlaningrum of Prakarsa moderating.

In Viet Nam, there has been a deliberate push for  getting bigger shares in the global market for its agricultural products.  Dr. Nguyen said that Vietnam emerged as a major coffee producer following a deliberate publicly-supported move into the sector with a focus on cultivating the flavourful Robusta beans.  As a result, between 1980 and 2000, Vietnam went from producing 8,400 tons of coffee to producing 900,000 tons. 

Wanun Permpibul said farmers in Thailand are now pushed to produce for the global market but for farmers rice is not  a commodity but a livelihood. She shared that traditionally in Thailand rice is grown for consumption and only what is left is sold. The problem of the global rice value chain is that the “farmers, our food producers, are not properly recognized,” she said.

Dati Fatimah pointed out that economies are not engaged in the global value chain (GVC) on an equal footing.. She said countries differ in where they are located in the GVC with upstream countries, mostly from the Global North, possessing knowledge of the process and processing the raw materials and therefore benefiting more. Farmers downstream of the value chain, have no say in policies, she noted. 

The discussion on food and agriculture continued in breakout groups.  Participants  discussed free trade impact upon local farmers (e.g. IPRs), sea pollution impact on fisher folks,  farmers’ lack of  access to production inputs, and the lack of acknowledgements of women’s role in food production.

For food security for the world, the group identified the adoption agriculture traditional system, the Subak system, a water management (irrigation) system for the paddy fields on Bali island, Indonesia. They also resolved to collect data on agriculture supply chains and to dialogue with MPs and government. Also suggested was the holding of a Southeast Asia farmers’ festival and joint campaigns with alliances to coincide with events like the UN Food System Summit or around the dates of the adoption anniversary of the anniversary of the ​​United Nations Declaration on the Rights of Peasants and Other People Working in Rural Areas (UNDROP) or the UN Declaration on the Rights of Indigenous Peoples (UNDRIP).

 

Campaigning for Economic Justice

 

In campaigning for economic justice, issues in global economic governance and continuing power imbalances and asymmetrical relations need to be addressed.  These are also reflected in current global tax rules and rule making. Jeannie Manipon, APMDD Development Finance program manager, asserted that “national tax systems in many parts of the world are legacies of our colonial history, and thus tilted towards serving the interest of the former Western colonial powers,  multinational corporations, and local elites.” 

She said the grave inequalities, within and among countries, and elite and gender biases must be addressed to overcome crises and build a sustainable  people’s recovery.  Manipon also presented a comprehensive tax justice advocacy and campaign agenda contained in the  People’s Manifesto: Tax the Rich, Not the Poor! Make Taxes Work for People and Planet. The agenda and policy recommendations were  hammered out by the APMDD through country consultations, joint actions  and the People’s Assembly for Tax Justice held on 30 October 2021. 

The People’s Manifesto puts forward seven demands for  fundamental reforms to address flaws in tax systems, policies, and ‘rule-making’ that exacerbate inequalities. The first demand is to “Tax the Rich, Not the Poor”.  Governments are being called to  institute a progressive tax on wealth and accumulated assets of high net-worth individuals, and for countries around the world to establish cooperative mechanisms to strengthen the effective enforcement of wealth taxes by plugging loopholes that allow for illicit financial flows of untaxed wealth.

The second demand is to “Make Taxes Work for Women and Other Marginalized Sectors”.  The demand requires that tax and fiscal systems address gender biases and discriminatory policies that deepen inequalities and reinforce economic and social exclusion. The five other demands are *Reclaim public services; increase and mobilize public funds for fulfilling peoples’ rights and needs!; *Make MNCs Pay Their Share! Stop Corporate Tax Abuses and Other Illicit Financial Flows (IFFs); *Advance Tax Justice in the Extractive Industry!; * End Inequalities in global tax rules and rule-making!; and, System Change, People First Before Profit!

The work of the  Tax and Fiscal Justice-Asia was also discussed in this session by Becky Lozada, communications staff of APMDD Development Finance program. Formed in 2004, TAFJA is a regional alliance united in campaigning for greater transparency, democratic oversight and redistribution of wealth in national and global tax systems. It has working groups on tax and gender justice, on tax Justice in the extractives industry, on tax and ecommerce, among others. 

Lozada spoke on the TAFJA position hammered against the “tax deal of the rich” proposed by the Group of Seven in June 2021 for a 15 percent global minimum corporate tax rate. She said TAFJA along with other tax justice groups has long called for at least 25 percent as a global minimum so that resources can be generated to tackle social-economic crises and to provide essential public services to people. “TAFJA has thrown its weight behind the call for democratic and transparent mechanisms to address the global dimensions of tax abuses.  Part of the TAFJA press statement in June reads ‘with countries of the Global South most severely encumbered by foregone corporate tax revenues, we reiterate our call for a UN Tax Body towards more just and fair international tax rules,’” she said.

A breakout group on Inequalities and Economic Justice, looked into the lack of social protection for indigenous people, the situation of undocumented and informal workers, women’s lack of access to policy processes, development projects that impact negatively on women, climate change and energy, and free trade agreements.

They also discussed tax issues from the impact of taxes on rice prices and availability, VAT, and the need to enforce higher corporate taxes, and growing calls for a wealth tax like the windfall tax imposed by Malaysia.

The group recommended five points to raise these issues, especially before the G20, GCF Board Meeting, UNFCCC, Regional Comprehensive Economic Partnership (RCEP) processes:

-Involving women's participation during the decision making process for any project or program implemented in the community

-Empowering women to fight the difficult situation impacted by inequality economic policy by creating an economy creative SME independently

-Reducing retail tax (VAT) for consumers especially products mostly purchased by women and family goods, and increasing corporate tax to get distributed transparently for public facilities development and social protection program

-Ensuring the economic protection of women, including informal worker, by providing guaranteed access to availability of facilities, access to business permits for poor women.

-Stop the programs and projects that ignore human rights, prioritize projects that are environmentally sustainable, gender responsive and side with women.

Gender and marginalized communities

 

This session, in solidarity with the Global Days of Action on Tax Justice for Women’s Rights, featured Titi Soentoro of AKSI! and  Hoang Phuong Thao of ActionAid Vietnam as resources persons with Aryanto Nugroho of Publish What You Pay Indonesia moderator. 

Expounding on gender and economic justice,  Soentero  gave a feminist perspective in looking at the issues, especially policy measures to solve problems that miss the mark because of patriarchy. “Women are not in decision processes, whether in home or in governments,” she said, noting that this situation leads to bad decisions.  An example given by Soentero is how in Java a geothermal project meant for  “clean” energy resulted in trees being cut down and environmental destruction.  “Women have had to walk farther to fetch water, because their traditional source of water was now controlled by the geothermal project,” she explained. 

Thao emphasized the urgency of reclaiming public services as part of efforts to end inequality and poverty. She said tax and fiscal justice should go together but this will not happen under the mindset of the race to the bottom in corporate taxation aggressively being proposed by the G7-G20 and OECD.

A session on advocacies in Bali also focused on the situation of women. Nengah Budawati, of Women Crisis Center-LBH Bali  gave a glimpse into the grim realities of women in Bali. She said they have to contend with violence , including sexual assaults, discrimination even from members of their  families especially if they bear no son(s), and undervaluing and non-recognition of women’s work.  Women are bullied when the land they till yields little harvest; men are known to leave their family when  they have  only  daughters but still inherit everything. There are cases of sexual crimes committed by  “male holy persons” that go unpunished.

“The Women Crisis Center-LBH led by Buda, as she is fondly called, ,provides shelter and training for women to run livelihoods, exclusively to help women, for “the victims to help other victims,” as they are “usually ignored by society,” she said.

 

Women’s Voices for Tax Justice: Women, Mining and Climate

 

As a contribution to the Global Days of Action for Tax Justice for Women’s Rights called by the Global Alliance for Tax Justice (GATJ), APMDD and TAFJA also held an online forum to listen to women’s voices for tax justice and explore how mining and illicit financial flows impact on women’s rights and resilience in the face of an alarming climate crisis.

Read more here.

 

Campaigning on Global Tax and other Finance and Development Issues

 

Dereje Alemayehu, executive coordinator of the Global Alliance on Tax Justice (GATJ), addressing the workshop remotely,  emphasized the importance of pushing for inclusive processes that will allow the Global South, especially civil society, to truly have a say and be heard on financial policies.  He pointed out that the G20 follows the lead of the G7, including in supporting the “Inclusive Framework” that pushed for the new minimum corporate tax rates that benefits corporations and the big economies rather than countries of the Global South.

He called on civil society to further put pressure on national governments to reject the tax deal of the rich. There is urgency to this issue because the OECD is now moving to put the legal and institutional arrangements for the “tax deal of the rich” in place, he said. 

Another decision-making moment was the focus of the talk of Pooja Rangaprasad, policy director, Financing for Development, Society for International Development (SID). She  called attention to the inputs of  civil society groups for  a fourth UN Summit on Financing for Development or g Monterrey+20 Summit. She said 2022 marks 20 years since the first International Conference on FfD was held in Monterrey, Mexico that resulted in a landmark international consensus to address key financial and related issues pertaining to global development which took place just as the world was reeling from economic recession. “Such a summit has never been more urgent again given the financing needs in the context of the COVID-19 pandemic, and future summits including the UN Social Summit in 2025 that will only succeed if urgent reforms of the global financial system are advanced. It is time for UN member states to convene the 4th FfD conference/Monterrey + 20 to agree a new global consensus on an economic,” Rangaprasad said.

The Consensus of the FfD in 2002  included the critical goals of eradicating poverty and promoting sustainable development to advance to a fully inclusive and equitable global economic system. The FfD included the consideration of an international debt workout mechanism and equitable international taxation policies.

Taxation of the digital economy and e-commerce remains one of the thorny issues in global tax policy debates, and where interests of countries in the global north and global south tend to collide. Tony Salvador of the Third World Network  (TWN) explained that according to current global tax rules taxation of corporations is based on where they have physical presence or permanent establishment (tax treaty) but digital platforms do not need physical presence to do business in market jurisdictions. He said national governments should decide on how and what taxes are collected from digital corporations doing business in their jurisdictions. “This cannot be left to an international agreement as sought by the G7, G20, and the OECD. We need to push national legislatures to pass or maintain digital services taxes or otherwise tax foreign on eCommerce transactions.” Reforms are also needed in the international tax architecture, and the United Nations, according to Tony, is the proper venue to discuss international tax matters and called for support for the proposed UN Tax Convention.

The training workshop was a breakthrough face-to-face event for the organizers with many safeguards including various COVID tracking measures and tests for all participants to hurdle. It was held just a few days after C20 Indonesia staged the C20 Kick Off Ceremony & Meeting titled Listening to the World in Bali, in 7-9 March 2022.
Training participants came from Prakarsa, APMDD, TAFJA and network partners, including 

∙ From Indonesia, participants came from 

-Aksi! for Gender, Social, and Ecological Justice

-Publish What You Pay Indonesia

-Women Crisis Center - LBH

-Solidaritas Perempuan (SP)

-Transparency International Indonesia

-Association for Women's Small and Micro Business Assistance or ASPPUK

-Agrarian Reform Consortium (KPA)

∙ From Malaysia, the research based advocacy organization Monitoring Sustainability of Globalisation (MSN)

∙ From the Philippines, Oriang women’s movement and Sanlakas

∙ From Vietnam, ActionAid Viet Nam and the Viet Nam Center for Economic Studies and Strategic Studies (VESS)

Resource persons from Climate Watch Thailand and Indian Social Action Forum joined online sessions. 

The training workshop is part of the activities of the Oxfam-supported project, “Fair for All: Improving economic-social justice through agriculture-value chains and fiscal policy reform.” 

After the workshop, some participants sat down with groups in Indonesia, and with representatives from other countries also joining in via a Zoom link, in a meeting of the C20 Working Group that was opened up to workshop participants.

Facilitated by TAFJA’s Vidya Dinker and Prakarsa’s Herni Ramdlaningrum, those present were given an overview of the G20 by Ramdlaningrum. APMDD and Prakarsa committed to work together with the Working Group on Taxation and Sustainable Finance that has put on the table proposals for increased tax revenues to finance COVID-19 programs and climate mitigation under SDGs 2030 and Paris Agreement 2050; ecommerce taxation; and, ways to push for a more inclusive inter-governmental tax body, 

The Working Group shared their concerns and discussions on the tax proposals from the G7 countries for global minimum corporate tax of 15%  that does not effectively tackle profit shifting and tax dodging practices by multinational companies. The plans of the working group will be hammered out further and presented in various engagement opportunities up to the G20 Summit in October. 

A briefing on a ground-breaking proposal for fair and inclusive global solution to economic crisis was provided by Tove Maria Ryding, tax justice coordinator of the  European Network on Debt and Development (Eurodad). She spoke on a  civil society proposal for a UN Tax Convention, launched on March 10, which aligns international tax governance to key global commitments and obligations, including human rights, equality, gender environmental protection and the Sustainable Development Goals. The United Nations is the forum that leads on these issues and, at the same time, it is the only truly universal body that exists. That makes the UN the obvious place to anchor a truly global convention on tax. Bringing the Convention in the United Nations would provide all countries equal footing in the discussions, she stressed. 

The 17th G20 Heads of State and Government Summit will take place in November 2022 in Bali on the theme “Recover Together, Recover Stronger”.  Formed in 1999, the Group of Twenty or G20 consists of the world's major established and emerging economies, the 19 countries -- Argentina, Australia, Brazil, Canada, China, Germany, France, India, Indonesia, Italy, Japan, Mexico, the Russian Federation, Saudi Arabia, South Africa, South Korea, Turkey, the UK, and the US -- and the European Union.

Finance at the heart of major challenges to just, equitable, and inclusive development

This March, 20 years ago, the first International Conference on Financing for Development was convened under the auspices of the UN in Monterrey, Mexico. It was significant for several reasons. 

The Conference was an initiative of the Group of 77 (G77), the coalition of more than a hundred  developing countries, which shared growing discontent over the systemic failures of the international financial architecture. It was the first gathering of its kind spotlighting the deep cracks of this global economic and financial system through which countries of the South often fell through, and the need to mobilize financial resources to resolve persistent conditions of inequality, deprivation and impoverishment. It also sought to bring debates on the global economic and financial system back to the UN where countries are more assured of equal footing, rather than in narrow decision-making processes of international financial institutions and North governments where the richest countries hold sway.  

Today, several promises of the 2002 outcome document, the Monterrey Consensus, remain not only unfulfilled but rolled back, starting with the main goal “to eradicate poverty, achieve sustained economic growth and promote sustainable development as we advance to a fully inclusive and equitable global economic system”. Many of the financing for development issues remain unresolved and cracks have all the more deepened. There is no clearer indictment of systemic failure than the multiple crises intensified and exposed by COVID-19 that continues unabated especially in South countries.  

Speaking last March 17 at the annual conference of the group of open-minded states called the “Friends of Monterrey”, APMDD Coordinator Lidy Nacpil, underscored the key role of development finance in addressing the multiple crises of economic recessions, public health and climate.

“Finance is at the heart of every major challenge to just, equitable and inclusive development that is compatible with the health of the planet, most especially now at this time of multiple crises….The multiple crises should be taken as an opportunity to take decisive steps in transforming the global economic and financial system” but recommendations laid out in the draft Financing for Sustainable Development Report (FSDR) “fall short of taking the multiple crises as an opportunity to take decisive steps to transform the global financial system and begin constructing a new one that serves the needs and interests of people and the safety of the planet.” 

She reiterated key and urgent issues that civil society organizations* have consistently been raising, in light of serious gaps in the draft FSDR which will be adopted during the 2022 session of the UN Economic and Social Council (ECOSOC) Forum on Financing for Development Follow-up (FfD Forum)  in April 2022. 

a. The establishment of  a Sovereign Debt Workout Mechanism under the auspices of the UN that would comprehensively address unsustainable and illegitimate debt, including through extensive debt cancellation for all countries in need. 

b.  The establishment of a universal, UN intergovernmental tax body and a UN Tax Convention to comprehensively address tax havens, tax abuse by multinational corporations and other illicit financial flows through a truly universal, intergovernmental process at the UN, with broad rights holders’ participation.  

c. The delivery by  Global North countries of their full climate finance obligations.

d.  Agreement on a moratorium on Investor-State-Dispute-Settlement (ISDS) cases, removal of all ISDS provisions in all bilateral investment treaties and trade and investment agreements and the urgency for members of the World Trade Organization to adopt without delay a waiver from the obligations under the TRIPS agreement for health technologies and products related to COVID-19 countermeasures.

e. The regulation of Credit Rating Agencies (CRAs). 

f. Review development outcomes of public-private-partnerships, blended finance and other financing mechanisms that promote a ‘private finance first’ approach to infrastructure and public services. 

g. The acceleration of the implementation of the official development assistance (ODA) commitments to fulfill and exceed the 0.7% target for ODA in the form of unconditional grants. 

h. The Assessment of  systemic risks posed by unregulated or inadequately regulated financial sector instruments and actors.

i.  A Global technology assessment mechanism at the United Nations. 

j. Ensuring fiscal space and scaling up international cooperation for decent jobs creation and universal social protection in line with SDGs and ILO standards.

  

*Lidy Nacpil spoke on behalf of the CSO Financing for Development Group, an open civil society platform involving more than 800 organizations (with more than 950 individual members), and the Women’s Working Group on FfD.  

For the full text of her input, see Civil Society Perspectives on the Thematic Chapter of the 2022 Financing for Development Report.