Speech

Opening Remarks to the 2018 ECOSOC Forum on Financing for Development

April 23, 2018

Thank you, Chair. Excellencies, Ladies and Gentlemen, thank you for the opportunity to speak at the opening of the third ECOSOC Forum on Financing for Development. I bring best wishes for success from IMF Managing Director Christine Lagarde, who unfortunately was unable to attend today because of the IMF Spring Meetings.

The Spring Meetings provide a backdrop for the international community’s work with developing countries. So, I would like to inform you of key issues that we addressed:

• First, the global and regional outlook;

· Second, the buildup of debt in many developing countries;

· And finally, the role of economic diversification in development.

The global economy continues to show strength, led by the advanced economies and many emerging markets. However, conditions in some emerging and developing economies are more challenging, especially among commodity exporters. We project that over the next five years, about 30 percent of emerging market and developing economies will grow less in per capita terms than the advanced economies. That could have profound implications for achieving the sustainable development goals.

As the global economy recovers, many low income and developing countries are accumulating more public debt. Indeed, in some of these countries, indebtedness is reaching troubling levels. It is in this regard, that I welcome that the Inter-Agency Task Force Report on Financing for Development devotes a whole chapter to debt issues.

To address this problem, the IMF has suggested policy remedies to both borrowers and lenders:

· Borrowers would need to strengthen public investment management capacity, focus on projects with realistic rates of return, and tackle sizeable debt-reporting gaps. They also need to increase domestic revenue mobilization.

· Lenders would need to assess the impact of new loans on debt positions of borrower countries. When debt work-outs are needed, official bilateral creditors should coordinate, including on efforts towards enhancing debt transparency.

· For our part, the IMF is committed to working closely with our members to strengthen all aspects of their debt management.

One key recommendation we have for heavily indebted commodities exporters is to focus on diversification.

· First, develop the financial sector, which would support investment and financial inclusion.

· Second, strengthen the business environment, which would support private investment, trade, and entrepreneurship.

· Third, build human capital through improved education and health systems; and support for female entrepreneurs.

These issues feature prominently in the Addis Ababa Action Agenda to support the Sustainable Development Goals (SDGs). The IMF is fully committed to helping our members achieve the SDGs.

To conclude, we need to work together to mobilize the financing that can ensure that all countries make consistent progress and nobody is left behind.