In remarks at a major UN trade conference that opened on Monday in Barbados, Secretary-General António Guterres stressed that recovery from the COVID-19 epidemic must be sustainable and inclusive, introducing “an urgent four-point debt crisis action plan.”
Mr. Guterres advocated stronger support for vulnerable countries as they deal with debt distress, lack of investment, unfair trade, and the climate disaster, warning that uneven recovery is leaving much of the world behind.
While he emphasized the urgent need for vaccine equality now, he also stated that it is only “the first stage in a much longer race,” as the pandemic is jeopardizing decades of development progress.
Mr. Guterres stated at the most recent ministerial summit of the UN trade and development agency, UNCTAD, that a bold, sustainable, and inclusive global recovery is required. One that is beneficial to the majority rather than the minority. One that gives people hope and heals the environment. And one that ensures that all countries are on equal footing as they help their citizens during this historic period.
Countries will not be able to recover from the pandemic if they are enslaved by debt, which the UN head called “a dagger through the heart of global recovery”.
While praising the International Monetary Fund (IMF) for issuing $650 billion in Special Drawing Rights (SDRs), a sort of foreign reserve asset, he called for “a quantum leap in support.”
His four-point debt action plan includes redistributing unused SDRs to vulnerable countries, especially middle-income countries, and extending the G20 wealthy economies’ debt suspension initiative, which began in May 2020, until next year.
The Secretary-General also reaffirmed his demand for reforming “international debt architecture,” particularly for middle-income nations, by looking into creative debt swaps, buybacks, and exchanges.
Finally, he emphasized the importance of private money in filling the gap,” he stated. he said that it was terribly unfair that wealthy countries can borrow cheaply and spend their way back to prosperity while low- and middle-income countries struggle to keep their economies afloat.
With the pandemic jeopardizing development, the Secretary-General stressed the importance of countries being encouraged to make “bold investments” in education, social protection, health care, and decent jobs.
In this regard, the G20, the United Nations, and international financial institutions should collaborate with the Organisation for Economic Co-operation and Development (OECD) to advance the implementation of a global framework for corporate taxation so that “taxes benefit people in places where economic activity actually happens. Not in remote boardrooms, but in communities.”
Trade and investment, both of which have been hampered by the pandemic, should assist the world’s poorest countries.
These steps are critical in assisting countries in their transition to “green” economies based on renewable energy, which also necessitates updating the transportation sector, particularly the key global shipping industry, which accounts for around 80% of world trade.
The fourth problem facing the world community is the development of a global green economy, as governments attempt to limit global temperature rises in accordance with the Paris Climate Agreement.
Richer countries were also reminded of their decade-old promise to provide $100 billion yearly in climate funding to support the developing world, as the UN chief called for a commitment to achieve carbon neutrality by mid-century through measures such as phasing out fossil fuel subsidies.