It’s time to finance our future and ‘change course’, Guterres tells world leaders in Sevilla

This article is published in association with United Nations.

“We’re here in Sevilla to change course,” the UN chief told world leaders on Monday, calling on them to grasp a once-in-a-decade opportunity to close a $4 trillion financing gap facing developing countries to meet sustainable development goals – and build a better world for all.

António Guterres issued his clarion call noting that sustainable development powered by international cooperation, is now facing “massive headwinds.”

Addressing the opening session of the 4^th Financing for Development Conference (FFD4) in baking hot Sevilla, Spain – basking in record high June temperatures – the Secretary-General noted multilateralism itself is also feeling the heat, while trust between nations and institutions fray.

The world is on fire, shaken by inequalities, climate chaos and raging conflicts: “Financing is the engine of development and right now, this engine is sputtering,” he told the conference, attended by more than 50 world leaders, over 150 nations and around 15,000 delegates.

“As we meet, the 2030 Agenda for Sustainable Development – our global promise to transform our world for a better, fairer future – is in danger.”

Some two-thirds of the ambitious Sustainable Development Goals (SDGs) targets agreed in 2015 are significantly off track – hence the staggering $4 trillion investment needed to turn it around.

“We are here in Sevilla to change course. To repair and rev up the engine of development to accelerate investment at the scale and speed required,” said Mr. Guterres.

He described the outcome known as the Sevilla Commitment adopted on Monday – without the United States which pulled out of the process earlier this month – as a “global promise” to low-income nations to lift them up the development ladder.

The UN chief outlined three key action areas:

• First, get resources flowing fast at home to spur sustainable growth, and for richer countries to honour their pledge under the accord to double aid to poorer countries to boost development. This includes tripling the lending capacity of Multilateral Development Banks and innovative solutions to unlock private cash.
• Second, fix the “unsustainable, unfair and unaffordable” global debt system. Right now, poorer countries are spending around $1.4 trillion just servicing their vast debts in the form of interest payments. Among the innovations, a new borrowers’ forum will ensure fairer debt resolution and action.
• Third, reform the global financial architecture, with major shareholders playing their part, so that it empowers every country. “We need a fairer global tax system shaped by all, not just a few.”

The current crisis of affordability and stalled development is “a crisis of people,” he continued, which leaves families hungry, children unvaccinated, and girls left out of education.

“This conference is not about charity. It’s about restoring justice and to facilitate the ability of all people to live in dignity,” said Mr. Guterres.

“This conference is not about money – it’s about investments in the future we wish to build together.”

A tangible and actionable’ roadmap

King Felipe of Spain spoke just ahead of the official opening, telling delegates the multicultural city of Sevilla welcomes the world “with open arms”.

He said a new roadmap would emerge that is based on what is “concrete and tangible and actionable”.

The conference must be a success, because cooperation is one of our fundamental pillars of the multilateral world and “the ultimate embodiment of the values that sustain it – especially at this particular point in history where many certainties are melting away and many fears and uncertainties are taking shape.”

‘Our time is now’

Spain’s President Pedro Sánchez told delegates “our time is now and our place is here.” Millions of lives will depend on the choices made in Sevilla and going forward.

We must choose “ambition over paralysis, solidarity over indifference and courage over convenience,” he continued, adding that the eyes of world are on this hall, to see what we are ready to do together and in the face of this historic challenge we must prove our worth.”

Sevilla was “the New York of the 16^th century” in diplomatic terms he told delegates – and a cradle of globalism – we must all do that legacy justice today.

‘Sevilla is not an end point’

Secretary-General of the conference, Li Junhua – who’s in charge of the UN’s Department of Economic and Social Affairs (DESA) – said the week in Sevilla is key moment to mobilise the resources necessary to build a just, inclusive and sustainable future.

The UN effort to finance development has been anchored in multilateralism and solidarity – but today, the whole framework is under “profound stress.”

He said never has sustainable development been so tested but the pact made in Sevilla puts people back at the centre.

“Sevilla is not an end point, it is a launch pad for a new era of implementation, accountability and solidarity.” UNDESA is ready to support all nations to translate the commitment into international action, he underscored.

President of the UN General Assembly Philémon Yang told delegates above all, “we need leadership to guide the world forward into a brighter more prosperous future for everyone, everywhere.”

He said the Sevilla framework will renew global partnership for the decade ahead and provide a focus on a debt burden which is crippling the developing world.

President of the UN Economic and Social Council Bob Rae said trust between countries had to be strengthened, because its absence “creates chaos.”

“Most of all I want to congratulate states for bringing forward the ambition, deepening engagement between financial institutions.”

The week represents a real commitment to action, he said.

Ajay Banga, President of the World Bank Group, told delegates ending poverty remains his key mission and the surge in population underway in developing countries requires resources “at an unprecedented scale and pace.”

He said everyone knew that governments, philanthropies and institutions are unable to meet every projection or promise – which is why the private sector is essential to the Sevilla Agreement so that capital can flow.

Mr. Banga added that the bank’s reforms of recent years are about being a better partner to the private sector and government clients.

Improving response time, boosting capital and systems of growth are key – but much more is needed to deliver for the next generation.

Exempt least-developed from punishing tariffs: WTO

Ngozi Okonjo-Iweala, Director-General of World Trade Organization said the conference was gathering at a time of unprecedented difficulty.

After decades of positive contributions, the global trading system has now been “severely disrupted” leaving exports so hampered by unilateral tariff measures and policy uncertainty that the WTO has sharply downgraded growth forecasts.

Further tariff barriers on 9 July – the deadline set by the US administration – will only make the contraction in global trade worse.

She reminded that the WTO has argued for the least developed nations and Africa overall to be exempted from the tariffs, “so we can better integrate them into the world trading system, not further exclude them.”

She said the Sevilla Agreement rightly recognises international trade as an engine of development.

“We therefore need to bolster stability and predictability in global trade,” through action at many levels that can grow national resources through exports, she told delegates.

IMF calls for broader tax base

Nigel Clarke, Deputy Managing Director of the International Monetary Fund (IMF), called for broadening the tax base, building strong financial management systems, coordinating support and addressing debt more sustainably.

“Many countries continue to struggle with high interest costs,” he said, calling on the international community to improve debt restructuring processes.  

Through its capacity development, the Fund is equipping members to chart their own paths and is also providing financial support when they need it most, he added.