H.E. Mr. Johan L. Løvald
New York, 30 June 2004
We are here today to reaffirm our commitment to fighting poverty in the least developed countries. Achieving the Millennium Development Goals (MDGs) is our common challenge. There is international consensus, not only on the MDGs, but to a large extent also on how to reach them. And the Monterrey Consensus and the Brussels Programme of Action have established the framework for our joint efforts to promote sustainable development and eradicate poverty in the LDCs.
Norway attaches great importance to the follow-up of the Third UN Conference on LDCs in Brussels. Ensuring proper implementation of the Programme of Action should be given the highest priority by all parties – UN agencies, other multilateral institutions, the bilateral donor community and, not least, the LDCs themselves.
Recent reports tell us that we are lagging behind in our efforts to meet the MDGs by 2015. Some regions have made impressive strides forward, but most LDCs, particularly in sub-Saharan Africa, have only seen slow progress – some have even shown negative trends in relation to several of the goals. The UNCTAD LDC report estimates that the number of people living in extreme poverty in the 50 LDCs will increase from 334 to 471 million in 2015 if current trends persist. This means that we must act. It means we must mobilise resources on a broad scale – internationally as well as nationally.
The main responsibility for development lies with the LDCs themselves, as the Brussels Programme of Action stresses. Sustainable development and poverty alleviation cannot take place unless the basic national conditions are in place. Sound policies and good governance are needed at all levels: in macro-economic policies and public administration, in relation to democracy and human rights. Better anti-corruption policies and investment in social and physical infrastructure are also needed in order to combat poverty in a broad-based and equitable way.
Important reforms in these fields have been made in many LDCs, but more progress is needed if we are to succeed in mobilising the necessary resources – nationally and internationally – to fight poverty in these countries.
The international donor community will – indeed, it must – assist LDCs in this endeavour. We all share a joint responsibility for the successful follow-up of the Programme of Action. It is clear that LDCs will need greater international support in the areas of development aid and debt relief as well as improved market access if the Millennium Development Goals and the objectives of the Programme are to be met. This will require partnerships, and Norway wishes to make a constructive contribution to such a partnership for development and poverty alleviation in LDCs.
Thus, LDCs need more and better aid. They need better debt relief. They need improved market access and further integration into the international trading system. They need more foreign direct investment and measures to stimulate private sector development.
International estimates indicate that development assistance must be doubled if the MDGs are to be reached. We have witnessed a positive increase in ODA to LDCs over the last two years, but more money and more reforms in ODA delivery are needed.
Norway’s development assistance in 2004 is 0.94 per cent of our GNI. The Norwegian Government is committed to reaching its target of 1 per cent, and in the next parliamentary period from 2005 to 2009 we intend to remain at that level at least.
Norway has made the LDCs a target group for ODA, and all our main partner countries are LDCs. It is a long time since we exceeded the agreed target of 0.2 per cent of GNP as ODA to LDCs. Last year LDCs received 42 per cent of all our bilateral ODA.
Volume is, however, not enough. We also need more effective and co-ordinated aid, and reform of the way we provide aid. Poverty reduction strategies are important tools in this respect, , but the strategies themselves need further improvement to ensure country ownership, broader participation and broader coverage.
Links to budgetary processes and to the MDG targets should be also strengthened.
Debt sustainability in low-income countries continues to be an essential condition for economic stability and development. It is imperative that we fully complete the HIPC Initiative, and ensure that more countries are granted broader and deeper debt relief. HIPC must be extended beyond the “sunset clause”, and long-term financing of the initiative must be ensured. This must include the necessary financing for “topping up” debt relief for countries going through external shocks. It must also include the financing of debt relief for countries emerging from war and conflict. A more robust debt sustainability framework that provides for more accurate assessment of countries’ financing needs should be established. These are important issues, and measures to alleviate the situation are included in a new Norwegian plan of action that we have called “Debt Relief for Development” and that presented by the Government in May this year. Norway will continue its active role in international efforts to deal with developing countries’ debt problems. We will continue to cancel 100 per cent of the debt of the poorest countries and we will continue to finance bilateral debt relief outside our development budget.
Trade is an important vehicle for promoting economic growth and development. Developing countries, particularly LDCs, need improved market access in order to avoid the debt trap and achieve long-term, sustainable growth. Norway is doing its part in these efforts. As from July 2002 all imports from the least developed countries have been granted duty- and quota-free access to the Norwegian market. We encourage all other developed countries to follow suit. Advanced developing countries should also contribute to improved market access for LDC exports. Revitalising the Generalised System of Trade Preferences (GSTP) could be an important means of promoting South-South co-operation and trade.
But still more needs to be done. Ongoing negotiations in the WTO are particularly important in this respect. Within the WTO special consideration is being given to the LDCs. And rightly so. This applies to market access, to trade-related technical assistance and to special and differential treatment.
Market access is a necessary, but not a sufficient condition if poorer developing countries are to benefit from market openings. International trade cannot promote poverty reduction if export performance is weak, and if economic links between exports and the rest of the economy are minimal. Thus, we need to develop production and trade capacity and expand employment opportunities in LDCs. We need to address supply capacity constraints; in particular those related to productivity and quality, logistics and infrastructure. We need aid for trade. And to optimise the effect of such financial and technical assistance we need a co-ordinated and coherent approach. The Integrated Framework for trade-related technical assistance to LDCs provides a good basis for such an approach. Norway is a major supporter of the Integrated Framework, of the Joint Integrated Technical Assistance Programme for African countries, and of the various trust funds for technical assistance in UNCTAD, ITC and the WTO.
To generate the growth and resources necessary to reach the MDGs, public resources and ODA are far from sufficient. We need a more vigorous private sector that provides job opportunities and stimulates trade and exports in the developing countries. Foreign direct investment can play an important role in this respect, by providing not only capital but also technology and knowledge that can accelerate the development process. Only a minor share of foreign direct investment is, however, directed to poorer developing countries. In 2002 only 5.2 billion USD went to LDCs, which is less than 1 per cent of the world total. This trend needs to be reversed, and for this we need to combine our efforts.
Developing countries need to develop stable and predictable framework conditions for private sector development and investment. Development partners can provide ODA for building infrastructure, and institutions that are conducive to private sector development. Furthermore, development partners can stimulate foreign investment by offering risk sharing, venture funds and investment guarantees in poorer developing countries. Norway has established a special fund for investment in developing countries, NORFUND, which provides risk sharing, investment and expertise – directly or via local venture funds – for the development of private enterprises in developing countries. Priority is given to investments in LDCs. In 2003, 41 per cent of the Fund’s investments went to LDCs.
If we are to reach the Millennium Development Goals, every country – indeed every actor – has to deliver. With MDG 8 we have made a commitment to a global partnership. In Monterrey and in Brussels we agreed on a global bargain: we, the developed partners, have committed ourselves to delivering on ODA, debt relief, trade and other policy areas. At the same time the LDCs, on their part, have made a commitment to improving their performance and their governance. UN agencies and other multilateral development partners are included in this bargain since they have important roles to play in our joint efforts to reduce poverty and improve peoples’ lives in LDCs. Our efforts not only need to be intensified, they also need to be co-ordinated and coherent, and I am confident that the discussions during this High Level Segment of the Economic and Social Council will provide a useful impetus for improving and strengthening our co-operation. We know what to do; now we must do it. Only if we all keep our promises can we succeed.
Thank you, Mr Chairman.