As COVID-19 takes an unprecedented human toll, societies are in turmoil and economies are in free fall and while developed countries are moving to keep families and businesses afloat, many developing countries are risking catastrophe.
Unless we take action now, there will be unimaginable devastation and suffering around the world with historic levels of hunger and famine.
The situation is expected to affect the livelihood of 1.6 billion people in the world over with $8.5 trillion wiped out of global output, this being the sharpest contraction since the Great Depression in the 1930s.
These were the bold remarks made by the United Nations Secretary-General H.E António Guterres, at a recent United Nations High-Level Global Leadership Virtual Conference on securing financing for development in the era of COVID-19 and beyond.
He said the pandemic is a human tragedy. “We need a decisive multilateral effort to support them and I’m encouraged that we will work together in six critical areas,” H.E Guterres added. “We need to find ways to enhance global liquidity so that developing countries have the resources they need to fight the pandemic.”
He called for immediate collective action in the six critical areas which includes preventing debt crises in all countries at risk, including middle income countries; engaging with private creditors on joint debt relief efforts; aligning global financial systems with the Sustainable Development Goals; ending illicit financial flows and rebuilding differently and better. H.E Guterres said the pandemic has uncovered our global fragility.
“In the recovery from COVID-19, we need visionary leadership based on unity and solidarity. Returning to the old, discredited frameworks and systems that created this fragility is out of the question. We must build back better,” he said. “Economies must serve people and strengthen social bonds, they must be founded on sustainability and inclusivity, they must reduce inequality in all its forms, including gender inequality and they must provide opportunities for everyone.
“The 2030 Agenda for Sustainable Development, the Addis Ababa Action Agenda and the Paris Agreement on Climate Change will guide us through these turbulent times. The entire United Nations system is mobilised in support of governments around the world for response and recovery. “Acting together, we can generate change that will save lives and livelihoods devastated by COVID-19.
It is also an opportunity to come together and join our efforts for global survival, peace and prosperity.” Fijian Prime Minister Honourable Josaia Voreqe Bainimarama drew the attention of the world leaders to the unique challenges that the Small Island Developing States faced during this COVID-19 pandemic, which has drastically affected the sectors of the economy such as tourism, the collapse of remittances and the deepening uncertainties in supply chains, to name just a few.
He called on the world leaders to step up international solidarity that allows countries like Fiji the fiscal space to maintain and expand social protections, while maintaining economic stability and sustained economic growth. “This pandemic’s economic consequences have proved far beyond our capacity to constrain, with up to 40 per cent of Fiji’s Gross Domestic Product dependent on tourism, our road to economic recovery winds long and run steep,” he said.
“The changes of a post-COVID world will be radical, and they will require radical financing solutions. But as economies of Small Island Developing States are left reeling, our tourism revenue is gutted, and our lending capacity is limited, we cannot go at it alone.
“Just as a global health recovery cannot be confined to those who can most afford a possible new vaccine, a global economic recovery cannot be limited to those large economies who can unilaterally inject trillions into social and economic stimulus because of a superior position in the global financial system. Our global COVID-19 recovery must be bold, coordinated and inclusive.
“Developed nations have injected $8 trillion dollars into their own economies, with more yet to come. If even the equivalent of one half of one per cent of this was dedicated to the entire world’s Small Island Developing States, it would provide us with the vital support we need. But to get there, we will need far greater creativity on the part of the IMF, World Bank, regional development banks, and most importantly, international solidarity among the world’s large economies”.
Prime Minister Bainimarama added that we need international solidarity that provides us with grant and concessionary financing on a scale that allows us to repurpose existing economic sectors and build new ones that are fit for a post-COVID era.
“We need international solidarity that provides substantial relief from debt, including for climate-vulnerable middle-income Small Island Developing States and also to provide access to finance that allows us to develop economic opportunities in a way that is conscious of our broader Sustainable Development Goals,” he said.
The High-Level meeting, which was co-convened by the H.E António Guterres and the Prime Ministers of Canada and Jamaica, saw the participation of 50 Heads of State, leaders of the International Monetary Fund, the World Bank, the Institute for International Finance, the Organisation for Economic Co-operation and Development, and the special envoys of the United Nations and the African Union.