FfD Conference Fails to Finance dev
*Extract of the article written for Inter Press Service by Bhumika Muchhala, Senior Policy Analyst on Finance and Development at Third World Network in Malaysia
The third Financing for Development (FfD) conference in Addis Ababa concluded in July 16, in bad faith as developed countries rejected a proposal for a global tax body and dismissed developing countries’ compromise proposal to strengthen the existing U.N. committee of tax experts.
The hallmark failure of the 3rd FfD conference is the missed opportunity to create an intergovernmental tax body. Instead, there was deep disappointment amidst developing countries and many U.N. staff and outrage amidst civil society who had been following the FfD process over the last year. But among developed countries, there was relief, at best, or complacency, at worst. A fundamental opportunity was lost to tackle structural injustices in the current global economic system and ensure that development finance is people-centred and protects the environment.
The Addis Ababa outcome is wholly inadequate to support the operational Means of Implementation (MOI) for the Sustainable Development Goals (SDGs), and exposes an unbridged gap between the rhetoric of aspirations in the post-2015 development agenda and the reality of the void of actions in the Addis Ababa outcome, which does not commit to new financial resources let alone scaling up existing resources.
The Addis Ababa Action Agenda displays a retrogression from the past, which undermines the FfD mandate to address international systemic issues in macroeconomic, financial, trade, tax and monetary policies.
The hallmark failure of the 3rd FfD conference is the missed opportunity to create an intergovernmental tax body. Such a global tax body, that would enable the U.N. to have a norm-setting role in tax cooperation at an equal capacity to that of the current monopoly of the OECD, would have been a meaningful advancement in global economic governance and domestic resource mobilisation.
The intransigence of developed countries against such a key step demonstrated their unwillingness to democratise global economic governance and their disregard for FfD and U.N. standards of “good governance at all levels” and “rule of law.”