Finance minister addresses UN Public Financing for Development forum

The theme of this year's UNGA is: ‘Scaling up affordable and accessible international public financing for sustainable development and ensuring efficiency’. 

Delivering his statement, Hon. Minister Keita stated that the convergence of climate change and the lingering effects of COVID-19 have exacerbated food and nutrition insecurity.

 “While developed countries adopted expansionary fiscal and monetary policies that enabled them to invest in recovery, many developing countries were unable to do so, due to high cost of borrowing with interest rates up to 8 times higher than developed countries,” he said.

 He also indicated that to effectively address the pressing environmental and socioeconomic challenges and foster resilient recovery, the Government of The Gambia has formulated a Green Recovery - Focused National Development Plan to address the challenges of climate change and accelerate sustainable development efforts.

He added that the Government has embarked on some innovative financing initiatives without adding on the debt stock, which includes Asset Recycling, Public Private Partnership and Domestic Revenue Mobilization measures.

Minister Seedy K.M. Keita pointed out that given that the world is interdependent; issues of global partnerships and collaboration require collective action.

He re-echoed the call by the UN Secretary General requesting the Group of Twenty (G20) to scale up affordable long-term financing for developing countries in need by at least US$500 billion a year—a transformative SDG Stimulus package, which could accelerate the implementation of the 2030 Agenda.

“We commend the G20 for setting up the DSSI in May 2020, which has helped developing countries including The Gambia to concentrate our resources on fighting the pandemic and safeguarding the lives and livelihoods of the most vulnerable. Since the initiative has expired, it has placed additional pressure on countries for paying both principal and interest on their debts,” he noted.

The Finance Minister called for a fit-for-purpose global financial system, where countries are supported based on needs.

"The $650 billion in Special Drawing Rights (SDRs) allocated in 2021, developed countries received about $420 billion, or 66 per cent of the total. Meanwhile, Africa received only 5.2 per cent, or $34 billion, while LDCs received less than $17 billion, or just 2.5 per cent. This is regrettable, however, we can do better," Minister Keita observed. 

On the need for debt cancellation, Hon. Keita said a number of sub Saharan countries are spending more on debt repayment than expenditures on health and education.  He continued that the spending more on debt repayment than expenditures is compromising the needed vital human capital formation and investments in infrastructure needed for growth.

"The global financial system must be recalibrated to take into account the vulnerabilities imposed on the developing countries by the undue debt burden arising by the current financial system," the minister said.

He pointed out that the approach of the rating agencies towards the developing countries must also be revisited; adding that the developing countries are now paying more for funds raised in the international markets than developed countries with similar economic fundamentals.

He emphasized that the UN and other multilateral institutions should enhance investments on global public goods—with special attention to climate change and the digital economy, so that no one is left behind.