General Debate

Mr Chair,

I have the honour of speaking on behalf of the EU and its Member States (MS).

Let me first thank the cofacilitators for the Elements Paper.

A strengthened FfD agenda should match ambitions with transformative actions to deliver on the SDGs, addressing global challenges and cross-cutting issues. FfD4 needs to enhance ownership, trust in multilateralism, be inclusive, support gender equality, leave no one behind and build on the Summit of the Future. We reaffirm our commitment to the FfD agenda. We already offer solutions i.a. through the Global Gateway, which aims at mobilising up to EUR 300 billion for sustainable and high-quality investments supported by the EFSD+. Other EU initiatives include the Paris Pact for People and the Planet and the Hamburg Sustainability Conference.

FfD4 should ensure coherence, complementarity and synergy with the ongoing work under various international fora and not pre-empt or undermine other decision-making processes in relevant institutions within or outside the UN.

We encourage enhancing existing investment and technical assistance facilities, before creating new global ones with similar purposes. Actions should build on existing processes, while fully recognising the mandates of international standard-setters, market and prudential regulators, to avoid unintended consequences in financial markets.

Similarly, the priority today is not to create new debt relief mechanisms, but to scale up the implementation of existing initiatives. There is a need to step up and improve the implementation of the G20 Common Framework for Debt Treatments. Recent progress on country cases shows that it delivers. We need to make the debt treatment process under the Framework timelier and more predictable for debtor countries.

We will continue supporting countries’ efforts to implement long-term stability-oriented macroeconomic policies, sound public debt management and debt transparency. We welcome the call for strengthening domestic revenue mobilisation, enhancing international tax cooperation, and fighting against illicit financial flows. Further, public spending should be transparent, efficient, accountable and aligned with the SDGs.

We welcome the progress achieved in Multilateral Development Banks’ (MDBs) reform agenda.  We suggest stronger focus on the implementation of the G20 Roadmap for better, bigger and more effective MDBs. We welcome the call for further ambitious implementation of the G20 Capital Adequacy Framework recommendations to enhance MDBs financing capacity. More focus should be paid to Multilateral and National Development Banks cooperating as a system.

We support the ongoing World Trade Organisation reform process and is committed to free, fair and sustainable trade, and to the international rules-based system with the WTO at its core.

Scaling up private finance is essential and should be supported through risk sharing instruments such as guarantees and blending. We would welcome even more emphasis on innovative financial instruments (such as use-of-proceeds thematic bonds), and structures (such as public-private investment vehicles), crowding in institutional investors to reach scale and impact.

We welcome the emphasis on conducive environments to attract private investors, including through credible and interoperable sustainable finance frameworks and enhancing interoperability between existing taxonomies worldwide rather than developing a new global SDG taxonomy based on objectives.

Regarding International Development Cooperation, we welcome revitalising the Development Effectiveness Agenda. We also, as the biggest provider of Official Development Assistance (ODA), recall our collective commitments to ODA targets, but we see no need to add “binding timeframes” beyond what was set in 2030 Agenda.  

Finally, we acknowledge the importance of enhancing the representation and voice of developing countries in global economic governance. We welcome the creation of the 25th chair for Africa at the IMF Executive Board. On SDRs, while we welcome ambitious language regarding rechannelling, we need to preserve SDRs role as an international reserve asset and respect national legal frameworks.

We look forward to further discussions ahead.

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3 December 2024 - General Statement on behalf of the EU and its Member States delivered by European Commission, Mr Antti Karhunen, Director

Mr Chair,

I have the honour of speaking on behalf of the EU and its Member States (MS).

Let me first thank the cofacilitators for the Elements Paper.

A strengthened FfD agenda should match ambitions with transformative actions to deliver on the SDGs, addressing global challenges and cross-cutting issues. FfD4 needs to enhance ownership, trust in multilateralism, be inclusive, support gender equality, leave no one behind and build on the Summit of the Future. We reaffirm our commitment to the FfD agenda. We already offer solutions i.a. through the Global Gateway, which aims at mobilising up to EUR 300 billion for sustainable and high-quality investments supported by the EFSD+. Other EU initiatives include the Paris Pact for People and the Planet and the Hamburg Sustainability Conference.

FfD4 should ensure coherence, complementarity and synergy with the ongoing work under various international fora and not pre-empt or undermine other decision-making processes in relevant institutions within or outside the UN.

We encourage enhancing existing investment and technical assistance facilities, before creating new global ones with similar purposes. Actions should build on existing processes, while fully recognising the mandates of international standard-setters, market and prudential regulators, to avoid unintended consequences in financial markets.

Similarly, the priority today is not to create new debt relief mechanisms, but to scale up the implementation of existing initiatives. There is a need to step up and improve the implementation of the G20 Common Framework for Debt Treatments. Recent progress on country cases shows that it delivers. We need to make the debt treatment process under the Framework timelier and more predictable for debtor countries.

We will continue supporting countries’ efforts to implement long-term stability-oriented macroeconomic policies, sound public debt management and debt transparency. We welcome the call for strengthening domestic revenue mobilisation, enhancing international tax cooperation, and fighting against illicit financial flows. Further, public spending should be transparent, efficient, accountable and aligned with the SDGs.

We welcome the progress achieved in Multilateral Development Banks’ (MDBs) reform agenda.  We suggest stronger focus on the implementation of the G20 Roadmap for better, bigger and more effective MDBs. We welcome the call for further ambitious implementation of the G20 Capital Adequacy Framework recommendations to enhance MDBs financing capacity. More focus should be paid to Multilateral and National Development Banks cooperating as a system.

We support the ongoing World Trade Organisation reform process, and we are committed to free, fair and sustainable trade, and to the international rules-based system with the WTO at its core.

Scaling up private finance is essential and should be supported through risk sharing instruments such as guarantees and blending. We would welcome even more emphasis on innovative financial instruments (such as use-of-proceeds thematic bonds), and structures (such as public-private investment vehicles), crowding in institutional investors to reach scale and impact.

We welcome the emphasis on conducive environments to attract private investors, including through credible and interoperable sustainable finance frameworks and enhancing interoperability between existing taxonomies worldwide rather than developing a new global SDG taxonomy based on objectives.

Regarding International Development Cooperation, we welcome revitalising the Development Effectiveness Agenda. We also, as the biggest provider of Official Development Assistance (ODA), recall our collective commitments to ODA targets, but we see no need to add “binding timeframes” beyond what was set in 2030 Agenda.  

Finally, we acknowledge the importance of enhancing the representation and voice of developing countries in global economic governance. We welcome the creation of the 25th chair for Africa at the IMF Executive Board. On SDRs, while we welcome ambitious language regarding rechannelling, we need to preserve SDRs role as an international reserve asset and respect national legal frameworks.

We look forward to further discussions ahead.

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4 December 2024 - EU statement on Domestic and international private business and finance at the Second Preparatory Committee Session for Financing for Development 4 delivered by European Commission Director, Mr Antti Karhunen

Thank you Chair,

We welcome the focus of the Elements paper on incentivising, mobilising and scaling up private finance catalysed by public resources, essential to achieve the SDGs and the Paris Agreement.

In order to reach scale, impact, and create synergies, we would put even more emphasis on innovative financial instruments (such as use-of-proceeds thematic bonds, underpinned by concrete sustainable investment projects) and structures (such as public-private investment vehicles/funds), aiming at crowding in institutional investors. The EU’s Global Gateway, supported by EFSD+ guarantees and blending, as well as sustainable finance initiatives as the Global Green Bond Initiative are here to do just that. Through these initiatives, the EU aims at reducing the cost of capital for sustainable investments, notably by covering the part of the financial risk that private investors are not willing to take.

We also welcome the focus in the Elements Paper of conducive enabling environment for private investment through enhanced transparency, good governance and anti-corruption measures. This is extremely important to address the perceived risks of investors.

One case in point is sustainable finance frameworks. Today, more than 50 sustainable finance taxonomies have been developed worldwide, most based on economic activities. The priority of today is to enhance interoperability between this large number of taxonomies worldwide rather than developing a global SDG taxonomy based on objectives as this would represent a significant departure from established market practices and exacerbate complexity, without even mentioning the great challenge that agreeing on a global taxonomy would represent.

We welcome the strong focus in the Elements Paper on financial inclusion and expanding access to financial services for MSMEs, women, youth and marginalised groups, which is a key priority for the EU. For the expansion of access to financial services the proposed sequential approach is welcomed, recognizing the growing importance of impact investing to expand the assets base.

For the EU it is essential that the FfD4 process ensures coherence, complementarity, and synergy with the ongoing work under various international fora and do not pre-empt or undermine other decision-making processes in relevant institutions within or outside the UN. Given limited public resources, we encourage relying on or enhancing existing investment and technical assistance facilities, rather than creating new global ones with similar purposes, facing the same issues, and likely producing the same outcomes. It is also important to build and leverage the partnerships already formed among UN member states.

Actions put forward in the Elements Paper should better build on current processes and existing tracks, e.g. under the G20, recognising the scope and mandate of international standard-setters, market authorities and prudential regulators, to avoid unintended consequences in financial and capital markets. International discussions on prudential frameworks, global financial regulation (e.g. climate risk stress tests, asset management companies) and credit rating methodologies need to be held in appropriate standard-setting bodies.

We welcome the attention on FDI’s contribution to development objectives, which aligns with our value-based approach under Global Gateway. We stress the need for adequate tools to measure this contribution, including on decent job creation. The EU strongly supports an economy that works for people by basing our efforts on data and impact.

Local currency financing is one the most important challenges for private investors. The EU supports initiatives to address foreign exchange risks and high hedging costs, in view of fostering increased local currency financing.

Finally, sustainable and responsible corporate behaviour, including due diligence requirements and remedy mechanisms, is a must for the EU. Development of accompanying measures on business and human rights to keep up high standards is key. The EU has already developed a strong framework of support in this regard, and stands ready to share information and its experience.

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4 December 2024 - EU statement on International Development Cooperation at the Second Preparatory Committee Session for FfD4 delivered by European Commission Director, Mr Antti Karhunen 

Thank you chair,

International Development Cooperation, Official Development Assistance (ODA) and partnerships addressing countries’ needs and priorities remain essential for achieving the SDGs. We agree that the Development Effectiveness Agenda should be revitalised, and that country ownership should be further strengthened, supported by country led strategies, plans and platforms, relying when appropriate on the Integrated National Financing Frameworks. The EU supports partners in delivering on their priorities in a Team Europe approach to ensure our efforts are coherent and cohesive.

The EU is a strong supporter of an effective and efficient UN system. However, proposals for broadening the normative role of the UN in international development cooperation risk leading to fragmentation and duplication. Similarly, we would appreciate clarification on the proposals concerning strengthening the Development Cooperation Forum.

The EU believes that ODA should remain a major source of financing for sustainable development, especially for the poorest, fragile and conflict-affected countries. Optimising the use and availability of concessional finance to support vulnerable partners, including some middle-income countries, remains crucial, including with a clear allocation framework and without risking availability for the poorest countries or Least Developed Countries. This could have been more prominent in the Elements Paper.

We welcome that the Elements Paper recalls the targets of 0.7% of ODA/GNI and 0.2% of ODA/GNI to LDCs, whose timeframe is already given through the 2030 Agenda, so setting “binding timeframes” beyond that is unnecessary. Further, the Elements Paper should also have emphasised the key role ODA plays in international partnerships to catalyse other public and private sources of financing for sustainable development.

The EU programming is an inclusive process through dialogue with partner countries, EU Member States, and other key stakeholders. The EU wants to underline its willingness to build long-term, inclusive and mutually beneficial partnerships by proposing an integrated offer to partner countries.

We agree that robust and streamlined concepts and standards on SDG 17.3.1, TOSSD and ODA are important. However, we should build on progress made within these existing transparency frameworks and encourage their further development before establishing new ones.

Sustainable development, climate, environment, and biodiversity challenges are interdependent and require the mobilisation of both public and private finance at the domestic and international level, targeting in particular Low and Middle-Income Countries. This is crucial for the implementation of the Agenda 2030, the Paris Agreement, including COP29 Decision on the New Collective Quantified Goal on climate finance, and the Global Biodiversity Framework. The references in the Elements Paper to the Fund for responding to Loss and Damages (FRLD) and climate finance more generally, should be fully aligned with the officially agreed decisions of both the FRLD and the COP29 decision on the New Collective Quantified Goal.

The Elements Paper should have underlined more the critical role of ODA and building partnerships in fragile and conflict-affected settings. It is needed to prevent and mitigate crisis, building resilience, preparedness and addressing immediate needs and root causes.

In view of climate finance instruments, we call for a careful approach to the use of debt for nature swaps, as we would need to have more experience to establish whether they actually lead to the desired policy outcomes.

Finally, we should put a strong focus on the implementation of the G20 Roadmap for better, bigger and more effective MDBs. It presents comprehensive recommendations and actions for MDBs to evolve their visions, incentives structures, operational approaches, and financial capacities, so that they are better equipped to maximise their impact in addressing global and regional challenges. MDBs should make the most efficient use of concessional finance, focus on low-income countries and fragile and conflict-affected states, and explore targeted use of concessional finance towards projects for vulnerable middle-income countries in need of support for addressing global challenges. MDBs should also engage more systematically with the private sector, in risk-sharing initiatives and innovative tools for private capital mobilisation. We also encourage MDBs to work better as a system, to find synergies around country-owned platforms and to work towards the mutual recognition and harmonisation of their environmental, social and procurement standards. Finally, discussions on potential capital increases in MDBs should take place in their respective boards and principles should be explored to review the alignment of resources and strategies.

Thank you.

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5 December 2024 - EU statement on Science, technology, innovation and capacity-building at the Second Preparatory Committee Session for FfD4 delivered by European Commission Director, Mr Antti Karhunen

Thank you Chair,

The EU supports efforts to achieve universal and meaningful digital connectivity targets for 2030 and enhanced international collaboration for the full implementation of the Global Digital Compact, including closing the digital divides, and promoting secure connectivity.

Using public funds as a catalyst through innovative financing approaches such as blended finance and guarantees, will help maximise digital investments. We would like to see a greater focus on the role of MDBs, DFIs and agencies in supporting Science, Technology and Innovation. We welcome the reference on facilitating access to finance for fintech. Also startups, innovative SMEs and research infrastructures should be included in this effect.

We welcome the reference to STI for SDGs Roadmaps. They should be challenge-oriented, integrated with local contexts and with national or regional development plans. As an example, the EU funded project “STI for SDGs Roadmaps” in Africa, puts forward a methodology that presents solutions tailored to country-specific needs while promoting public-private partnerships and efficient investments.

We welcome the emphasis that the Elements Paper gives to investment in digital public infrastructure, digital literacy programmes and the promotion of equitable access to AI.

As EU, we support partners’ digital policies and regulatory frameworks and invest in digital services, skills, innovation, data centres, last-mile networks and submarine cables. Human capital, capacity building and voluntary technology transfers on mutually agreed terms enable just, inclusive and equitable transitions.

The need for new skills, reskilling and upskilling and life-long learning could be recognised more clearly in the Elements Paper.

The Elements Paper could further have emphasised the importance of science-policy panels such as the IPCC (^[1]), the IPBES (^[2]), the International Resource Panel, and the Science-Policy Panel on Chemicals, Waste and to Combat Pollution. These are important tools to provide the latest science and evidence to help policymakers address global crises, including climate change, biodiversity loss and pollution.  

Thank you.

([1])            Intergovernmental Panel on Climate Change

([2])            Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services

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5 December 2024, New York - EU statement on International trade as an engine for development at the Second Preparatory Committee Session for FfD4 delivered by European Commission director, Mr Antti Karhunen

The EU is committed to free, fair and sustainable trade, and to the international rules-based system with the WTO at its core. Trade can be a powerful driver of sustainable development, and we support strong actions in that vein, with a focus on fostering a level global playing field and resilient, sustainable and inclusive value chains, the benefits of which are widely shared.

The EU provides many forms of support to developing countries’ active participation in the multilateral system, including participation in negotiations in the WTO as well as effective implementation of agreements, such as the Trade Facilitation Agreement.

More generally, the EU and its MS are the world’s largest provider of Aid for Trade, a key tool for sustainable development in line with our Global Gateway Strategy. We provide support for the trading capacity of developing countries for investments in digital and physical infrastructure, for sustainable productive capacity, and to improving the enabling environment at national, regional and international level. We also provide extensive preferential market access via the GSP, the EPAs and bilateral trade agreements – and completely duty free quota free access for LDCs through the EBA. 

The EU fully supports special and differential treatment for developing countries, in particular LDCs. To make sure that SDT translates to a more level playing, it should be precise, effective and operational.

The WTO Agreements recognise two categories of members: developing countries and least developed countries. We are in favour of looking into the specific challenges of individual WTO members, but we do not support proliferation of sub-categories of developing countries in trade agreements.

Chair,

We absolutely do not agree with one-sided narratives on unilateral environmental trade measures which are designed to supporting achieving global commitments on climate change. In this respect, EU’s environmental measures are based on thorough impact assessments and carefully designed not to discriminate or treat imports differently from domestically produced products.

The EU, furthermore, engages with its partners actively on these measures both in the WTO and bilaterally. Openness, transparency and constructive dialogue are key to ensuring the effectiveness of such measures and also help target support to partners in view of adjusting to them.

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4 December 2024 - EU Statement on ‘Domestic public resources’ in the Elements Paper ahead of the fourth Financing for Development conference by Antti Karhunen, Director for Sustainable Finance, Investment and Jobs; Economy that works for the People​, Second Preparatory Committee meeting ahead of the fourth Financing for Development conference

The European Commission welcomes the comprehensive public finance agenda promoted in the Elements paper. It is crucial to act on both the revenue and the spending fronts to advance the achievement of the SDGs. 

On the revenue side, we agree with the priorities put forward, namely strengthening domestic revenue mobilisation, enhancing international tax cooperation and combatting illicit financial flows. We will continue supporting developing countries’ efforts to strengthen their tax policies and administrations, through coordinated and demand-driven capacity-building.

We also agree that tax systems must be fair and efficient. As a member of the Addis Tax Initiative Post-2025 Task Force, we will strive for ambitious commitments beyond 2025 on key policy reforms, institutional strengthening and capacity reinforcement. In addition, we need to collectively enhance fiscal transparency and step up the fight against corruption, money laundering and illicit financial flows, including by strengthening the prevention of these practices.

Global challenges require multilateral solutions. We must improve the implementation of existing initiatives and ensure the coherence of work strands across international fora. In particular, we support the work of the Global Forum for Transparency and Exchange of Information for Tax Purposes and of the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting, whose growing membership seeks to reform the international tax system, including through an ambitious two-pillar solution. We are also engaging constructively to facilitate an inclusive, transparent, efficient and effective process at the UN level.

On the spending side, we strongly support the proposals presented in the Elements paper. We need transparent, accountable and efficient public spending. Expenditure should be geared towards the provision of essential public services such as education, health, social protection or investment in basic infrastructure. Integrated national financing frameworks can contribute to efficient resource allocation. The EU will continue supporting countries’ efforts to build transparent and sustainable procurement systems, strategic public investment management and strong Supreme Audit Institutions.

Finally, fiscal policies and PFM systems should support the achievement of the SDGs, taking into account individual country contexts. First, we welcome the call to promote gender-responsive systems, contributing to a fair society and to the empowerment of women and girls. Second, we support the inclusion of environmental and climate considerations in fiscal programming. We believe that measures such as green budgeting and environmental taxation policies can help address environmental challenges, generate revenues, and support sustainable investments. Ongoing reflections to identify possible global solidarity levies are welcome in that context. Third, we support the digitalisation of PFM systems, as this is key to enable fiscal administrations to conduct their work more effectively and efficiently.

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5 December 2024 - EU Statement on ‘Debt and debt sustainability’ in the Elements Paper ahead of the fourth Financing for Development conference delivered by Antti Karhunen, Director for Sustainable Finance, Investment and Jobs; Economy that works for the People, at the Second Preparatory Committee meeting ahead of the fourth Financing for Development conference

The EU shares the assessment that high global debt vulnerabilities in developing countries are among the challenges threatening the achievement of Sustainable Development Goals (SDGs). Stability-oriented macroeconomic policies, coupled with sound public debt management and debt transparency, remain essential for maintaining debt sustainability. The EU will remain a strong partner in supporting these objectives.

There is a need to step up and improve the implementation of the G20 Common Framework on Debt Treatments for individual cases. Recent progress shows that the Common Framework delivers. We need to make the debt treatment process under this Framework timelier and more predictable for debtor countries. We support developing a user manual for debtors with clear timelines. We also support extending this Framework to all countries that need it.

We need to do more to ease liquidity constraints in vulnerable countries to prevent them from falling into debt distress. We support the ongoing work by the IMF and World Bank on a three-pillar approach to support vulnerable countries facing liquidity challenges. It could be opportune now to take stock and assess in which areas the toolbox needs to be improved and further developed, rather than creating new processes.

The priority today is not to create new debt relief instruments, but to scale up the implementation of initiatives launched in the last years.

We are strongly in favour of promoting a better implementation of existing mechanisms, platforms, and initiatives instead of creating new ones that will face the same issues. We support the Global Sovereign Debt Roundtable (GSDR), which allowed for progress on technical debt treatment issues by involving both creditor and borrower countries. The GSDR discussions could be extended to broader and more inclusive audiences depending on the topics presented.

We strongly support the continued mainstreaming of collective action clauses in debt contracts. We welcome the ongoing review of the Low-income countries Debt Sustainability Framework by the IMF and World Bank, to strengthen climate aspects in debt sustainability analysis and the call to further develop climate resilient debt clauses (CRDCs).

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5 December 2024 - EU Statement on ‘Addressing systemic issues’ in the Elements Paper ahead of the fourth Financing for Development conference delivered by Antti Karhunen, Director for Sustainable Finance, Investment and Jobs; Economy that works for the People, at the Second Preparatory Committee meeting ahead of the fourth Financing for Development conference

The EU has been actively engaged in the International Financial Architecture (IFA) reform towards better addressing the global challenges and will continue to significantly contribute to its objective to ensure delivery towards emerging markets and developing economies’ needs.

Negotiations and decision-making on international financial institutions governance need to be fully anchored in their relevant bodies.

We acknowledge the urgency and importance of IMF quota realignment to better reflect members’ positions in the world economy and the EU Member States will constructively work towards a quota realignment based on fair and broad burden sharing among all major advanced economies, while protecting the shares of the poorest members. We welcome the decision to create a 25th chair at the IMF Executive Board and include African Union at G20, which is enhancing the voice and representation of Sub-Saharan Africa. We also look forward to a successful outcome of the upcoming WBG Shareholding Review in 2025.

The EU also supports ongoing work to strengthen diversity and gender representation of IFI’s management and staff.

The EU welcomes that the international community has exceeded the USD 100 billion global ambition of voluntary contributions in Special Drawing Rights (or other equivalent) from advanced to vulnerable countries set by G20 in 2021. We encourage countries to continue to voluntarily re-channel SDRs to the IMF trust funds, while preserving SDRs role as an international reserve asset and respecting national legal frameworks. We must expedite the disbursement of the pledges already made and ensure the pledged resources are channelled to the countries in need. EU Member States pledged around USD 37 billion and are leading the way in transferring the resources to the IMF Trusts.

We welcome the review of the Poverty Reduction and Growth Trust (PRGT) and support a well-functioning, self-sustainable Trust to help meet the growing needs of low-income countries. We also support the IMF to continue to provide long-term financing linked to climate reforms via the Resilience and Sustainability Trust (RST) and stress the need to foster the necessary private investments in climate mitigation, adaptation, and transition. In this context, we call for close coordination with the EU and other development actors providing climate investments. The recent crisis has again demonstrated that the size of the IMF proved to be adequate. 

We also welcome the IMF’s review of its surcharge policy to help alleviate the financial cost of borrowing countries while preserving their incentive functions and safeguarding the Fund’s financial soundness.

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