Today, I will concentrate on the necessity of increased financial transfers from the wealthy North to the South - especially during a period when President Trump and the United States, along with numerous other Western nations, are cutting back on aid. I will contend that these transfers need to increase and take various forms, with multinational corporations and the broader private sector actively involved - for social, health, climate change, and other reasons, as well as to support overall growth and a more equitable distribution of wealth in developing countries. There is still much to be done, albeit late, since the end of the Colonial era, and since the United Nations' and the West's efforts to establish a New International Economic Order (NIEO) in the 1970s. The initiative was managed by the UN Conference on Trade and Development (UNCTAD), founded in 1964, but despite good intentions, the effort did not succeed; the Geneva-based organization remains, albeit quietly; its significant goals and work should be reinvigorated. Last week, however, it hosted the '4th International Conference on Financing for Development' (FFD4) in Seville, Spain, where a comprehensive plan for a better world was adopted.
The Norwegian Minister for Development Cooperation, Åsmund Aukrust, was a prominent speaker at the conference held in Sevilla. He stated, "The world has never been wealthier - so why does poverty still exist?" In an article co-authored with Lisetta Trebbi, the Acting Director General of NORAD, the Norwegian Agency for Development Cooperation, published in 'Panorama Nyheter' in Oslo on 03.07.25, additional details and topics were discussed. The article highlights that in a world marked by conflict, climate change, and rising costs, it's easy to believe we can't afford more spending. However, the authors argue the opposite, citing data from the 'Global Wealth Report,' which indicates that global savings now exceed USD 500,000 billion—enough to eliminate extreme poverty multiple times over. "There are resources available, but they are being diverted away from developing nations," Aukrust and Trebbi write.
The difference between what is required to achieve the UN's sustainable development goals and the actual funding being provided is greater than ever. Each year, there is a shortfall of USD 4-5 trillion—equal to one percent of global private savings. Meanwhile, wealthy nations are reducing their development aid budgets. What explains this situation? The key contradiction lies in the use of tax havens, secret fund transfers, and the growing accumulation of wealth, according to Aukrust and Trebbi.
In the concluding declaration of the meeting, titled 'Compromiso de Sevilla', four key actions were outlined as part of a plan aimed at creating a fairer world for the poorest nations. First, there is a need to boost development assistance. Second, efforts should be made to enhance tax collection capabilities and systems in developing countries, with support from donor nations. Third, the private sector should contribute more positively to the development of these countries, rather than acting against their interests. At times, private enterprises require more stability for future activities, which might necessitate assurances from donor countries. Fourth, new mechanisms must be established to manage the substantial debts of developing countries, including debt cancellation. Several nations allocate more funds to debt repayment than they do to their own education and healthcare budgets.
Aukrust and Trebbi mention in their article that the Sevilla summit offers renewed optimism regarding development funding. 192 UN member nations continue to back these initiatives, despite the USA withdrawing from the process a few weeks ago. 'The Sevilla declaration sends a strong message: A different world is still achievable. Now, it's time for words to translate into action, and Norway will remain at the forefront,' the two Norwegian officials in charge of development aid state. Norway played a crucial role during the twelve-month preparatory phase for the conference, alongside Mexico, Nepal, and Zambia, with input from the remaining UN member states, NGOs, and the private sector.
I hold a more skeptical view regarding the implementation compared to Aukrust and Trebbi, and there isn't much novel in the pledges either—similar to UNCTAD's proposals for a New International Economic Order in the 1970s. Well, perhaps the increased involvement of the private sector is somewhat new. However, there is minimal specific information from Sevilla regarding what donor nations will actually do and how they plan to deliver aid, including the scale and methods of improving collaboration with developing countries. I am convinced that significant changes are necessary; otherwise, only limited progress will be observed—and just as in my younger days, when we had high hopes for UNCTAD and the NIEO, this will end up being merely a 'Sevilla dream.'
There is a need for a historical analysis alongside a future projection, highlighting the errors made by wealthy nations but also explaining how they, too, will gain from establishing a more equitable global order, among other things, regarding migration and the development of vibrant and optimistic local environments for everyone. This certainly implies improved, less corrupt, and genuinely democratic governance within developing countries. In many instances, new institutions must be established in these countries to manage the increased international transfers, involving governments, NGOs, and both local and international private sectors, including major multinational corporations. A new structure with shared local and international leadership is essential to build trust among people in both the North and the South in the new system and its implementation.
In relation to a Conference of the Parties (COP) summit several years back, a new framework for significant financial transfers aimed at addressing climate change and environmental crises was introduced, which also included compensation for past exploitation of developing nations by developed ones. A key element was that wealthy nations should take responsibility for rectifying past and ongoing errors. This is commendable, yet it appears that very little has been accomplished in terms of achieving these objectives, including the establishment of a substantial fund. At the most recent conference, COP29, held in Azerbaijan in November last year, both participation and media attention were reduced compared to previous gatherings. Despite the promising Sevilla concepts, their outcome might mirror that of the COP initiatives, similar to how the UNCTAD and NIEO ideas of the 1970s ultimately failed. I could be mistaken about the future of COP or the Sevilla roadmap. Nevertheless, specific actions are necessary to ensure success.
Who will make the necessary efforts to bring the Sevilla ideas to life? The first thought is the group that was involved in organizing the conference, particularly Norway, which was the sole donor country in the group, along with the UNCTAD offices in Geneva. It's time to stop making grand promises and raising unrealistic expectations. This approach is counterproductive to building trust in development assistance, which currently has a poor reputation due to high costs and limited outcomes. We need a new and significantly increased level of development aid, as well as entirely new methods of implementation. Recipient countries should take the lead, with donors playing a supporting role. People in developing nations experience the need for improvements in social and economic conditions daily. Rich countries also require a moral revival, not only for their own citizens but also because they cannot continue to expand their military budgets at the current rate. We all need to consider and carry out positive actions on the path toward creating the better world we all desire.
Provided by SyndiGate Media Inc. (Syndigate.info).
