By Jaya Ramachandaran
PARIS (IDN) — Ministers and high-level representatives from 55 developed and developing countries have proposed a New Deal for Development and stressed the urgency of bridging the vaccine divide and strengthening financing capacities in developing economies. They have called for greater international support for developing countries on the occasion of the Seventh High-level Meeting of the OECD Development Centre, under the heading “Accelerating a just recovery for all” on December 6.
They are of the view that a New Deal for Development, based on solidarity and shared responsibility, could improve access to vaccines and mobilise international and domestic resources at a much larger scale. It would also ensure the crisis becomes an opportunity to reorient development models towards greater resilience, inclusion, equity and environmental sustainability.
The logic behind these remarks is that almost two years since the COVID 19 pandemic was declared, prospects for developing countries remain highly uncertain. Low vaccination rates and limited fiscal resources, amid the emergence of new variants and growing indebtedness, are hampering the efforts of policy makers to spur an economic recovery.
OECD Secretary General Mathias Cormann welcomed officials from the OECD Development Centre’s 55 member countries, international organisations and civil society representatives.
The OECD Development Centre meeting was co-chaired by Costa Rica and Togo. “We often hear that ‘we are all in it together’ but we are not really together in dealing with the pandemic. As of today, only 7.3% of the African population is fully-vaccinated and the cost of accessing much-needed financial resources remains too high,” said Victoire Dogbe, Prime Minister of Togo.
Andres Valenciano, Minister of Commerce of Costa Rica, emphasised the importance of trade, industry and innovation to overcome the pandemic, saying “We need well-functioning supply-chains and to refrain from export bans”. Beyond the immediate response, he added, “More needs to be done to invest and support research and industrial development in developing countries.”
Ministers commended multilateral efforts to distribute vaccines, particularly the work of COVAX, and welcomed the aspiration of countries donating one dose of vaccine for every dose administered at home (“one to one, everyone”). However, with supply pressures now easing, the meeting also underlined the importance of overcoming barriers to administering vaccines, including logistical challenges and vaccine hesitancy. Ministers also stressed the need to start preparing collectively for future pandemics.
Many developing countries could not respond to the pandemic on the same scale as advanced economies due to stagnating public revenues, growing debt levels and higher costs of borrowing. They are struggling to meet the ongoing costs of the pandemic, let alone invest in a recovery.
Ministers welcomed the historic general allocation of IMF Special Drawing Rights (SDR), equivalent to USD 650 billion, to boost global liquidity. They also encouraged countries with strong external positions to channel a share of their SDRs to help low-income and vulnerable middle-income countries finance the recovery.
Ministers and high-level officials called for those challenges to be addressed in a sustainable manner through:
Strengthening resource mobilisation and public investment to enhance healthcare and social protection systems in developing countries, particularly for the most vulnerable groups – women and youth – including in the informal sector.
Enhancing developing countries’ capacities to produce, distribute and utilise tests, medical supplies, treatments, and vaccines to ensure long-term resilience.
Making use of existing flexibilities in the international intellectual property (IP) protection frameworks, including through partnerships for voluntary licensing of IP and technology transfer on mutually agreed terms.
Enhancing developing and emerging market economies’ access to capital markets on affordable terms.
Deepening financial markets in developing countries, as well as payment systems and platforms to trade and settle transactions and strengthening independent monetary authorities.
Enhancing debt transparency through stronger public-debt management and integrated debt recording and management systems and implementing a comprehensive framework to restructure sovereign debt. In this regard, the adoption of the G20 Common Framework for debt treatment supporting in a structural manner low-Income country with unsustainable debt is a decisive step in the right direction.
Enhancing the mobilisation of domestic resources and catalysing other financial flows to advance sustainable development in all its dimensions and respond to the climate crisis, in line with commitments made at COP26 and before.
In support of these objectives, Ministers welcomed the Centre’s work and partnerships with institutions in Asia, Africa and Latin America. In particular, they encouraged the Centre to:
Explore how developing countries could leverage the medical-industrial complex for industrialisation, notably through the OECD Initiative for Policy Dialogue on Global Value Chains, Production Transformation and Development;
Continue to support gender equality and women’s economic empowerment;
Deepen engagement with the African Union, notably through the joint Platform on Investment and Productive Transformation and the possible establishment of an Observatory on Investment;
Foster quality infrastructure and regional connectivity;
Advance the design of an Equitable Framework and Finance for Extractive-based Countries in Transition (EFFECT), to support countries’ just transitions to low-carbon development models.
Finally, as the Development Centre approaches its 60th anniversary, the 55 member countries confirmed the relevance and value-added of the Centre and the original vision of its founding father, US President John F. Kennedy. Members established a Group of Eminent Personalities to reflect on pressing development challenges. [IDN-InDepthNews – 06 December 2021]
Image: OECD
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