India calls for remaking international financial architecture to give Global South greater say
India has called for remaking the international financial system by increasing the Global South’s representation in the management of institutions and expanding the lending capacities of development banks.
On Tuesday, Geetu Joshi, an advisor in the Department of Economic Affairs, said, “The international financial architecture must be more responsive to the needs of developing countries.”
“Expanding MDB [multilateral development banks] financing capacities coupled with greater synergy and cooperation within the MDB ecosystem is equally crucial,” she said here at the meeting of the Preparatory Committee for the Fourth International Conference on Financing for Development (FfD4).
Convened by the General Assembly, the FfD4 is set to meet in Seville, Spain, in June to assess compliance with international commitments to finance development and support reforming the international financial architecture.
Emphasizing the urgency for action, Deputy Secretary-General Amina Mohammed said the Sustainable Development Goals (SDGs) “have stalled [and] they can only be rescued by unlocking the scale and quality of finance required to power investments” in developing countries.
For this, “the grip of debt service that is crippling dozens of countries” has to be loosened, and economies have to be protected “from the external shocks that characterize today’s interconnected world,” Mohammed said.
Mohammed said the “FfD4 represents an important opportunity to fulfill the vision” for financial architecture reform articulated in the Pact for the Future, which world leaders adopted in September.
“Let us address debt [of developing countries] with bold ambition, and create a debt architecture that truly empowers sustainable development,” she said.
Mohammed also said that the FfD4 should create a “clear and actionable roadmap for expanding the capital bases of multilateral development banks.”
Joshi said India’s development template that prioritizes “a human-centric approach to sustainable development” succeeded in lifting 250 million people out of poverty and provides a model that can be replicated by the Global South.
She said that concerted international action that mobilizes developed and developing countries, and international institutions, is essential “to unlock the trillions of dollars needed for sustainable development.”
Accelerating progress toward the UN’s sustainable development goals “hinges on strengthening global partnerships, particularly South-South and triangular cooperation, to foster the exchange of knowledge, resources, and expertise,” Joshi said.
To provide affordable finance for development, she said, a “conducive regulatory and policy environment” was essential.
Referring to the economic crises that have hit the developing world hard, she said, “We emphasize the need for a cohesive and collaborative international response to global shocks, with the UN at its center.”
