(6th informal meeting) Preparatory Committee for the Fourth International Conference on Financing for Development, Third Session

Excellencies, distinguished delegates, dear colleagues, good morning. I call to order the sixth informal meeting of the third session of the Preparatory Committee for the fourth International Conference on Financing for Development to continue with the consideration of the zero draft outcome document of the Conference. Distinguished delegates, we have a few speakers remaining on the section on international trade as an engine for development. Before giving the floor to the first speaker, I kindly request delegations to observe time limits of seven minutes for delegations speaking on behalf of the groups and four minutes for States speaking in their national capacity as well as other speakers. We reserve the right to adjust time limits as necessary in case of a long list of speakers. In order to keep track of time, a countdown clock will be visible on the screen to alert speakers when it is time to conclude their statements. As necessary, the microphone will be automatically deactivated when the time limit has elapsed. Speakers on behalf of groups should inform the secretariat in order to give precedence in the order of the speakers. The first speaker for today is Colombia, distinguished representative of Colombia, to be followed by the distinguished representative of Cuba. Colombia, you have the floor.

mr president i would like to turn to the implications of environmental measures linked to sustainable trade here colombia is of the view that this is a very important matter but in its current wording we need actionable clear commitments to ensure that it's effective we need to include concrete measures for its implementation and ensure accountability. In paragraph 45b, we recognise the importance of supporting the least developed countries, LDCs, in generating a value add for their basic and agricultural products. Nevertheless, there are other developing countries which also face major challenges when diversifying their economies and require technical and financial support to increase their local value added production. we need to make sure that no country facing these challenges is left behind and because of this we should say and other developing countries with similar needs in english. in paragraph forty five d colombia would highlight the importance of guaranteeing that trade infrastructure investment also generates synergies. with developing countries to facilitate regional integration. As has been pointed out consistently in WTO fora, including in negotiations on the Trade Facilitation Agreement, regional trade infrastructure will allow us to ensure that there can be pooled resources and it will strengthen regional value chains too. To maximise the impact of aid for trade, there is a need to ensure that this can boost competitiveness and the interconnectedness of countries facing similar challenges. Finally, paragraph 46 recognises the importance of countries being able to tap into their natural resources for sustainable development. However, it is also very important to recognise and address the possible adverse impacts of extraction of resources, particularly on ecosystems and vulnerable communities. Ensuring a fair transition means policies to mitigate adverse effects and to harness the opportunities in the sector. Therefore, we ask for an explicit reference to that in paragraph 46. We might even venture to suggest wording for that. Thank you very much, Govt Solicitor.

I thank the distinguished representative of Colombia. Now I'd like to give the floor to the distinguished representative of Cuba, to be followed by the distinguished representative of United Kingdom.

Thank you, co-facilitators. Good morning, colleagues. We, of course, in this cluster, would like to join what has already been expressed by the G77 and China and EOSIS. In national capacity, we would have to agree with the COFAX on the references to tariffs and trade restrictions in paragraph 42, in the context, in the current context, some, where some are using tariffs as a weapon, this reference in our view is essential. In 43E, we propose adding language so as to present the mentioned recommendations to the GA for appropriate action. The GA is the most democratic and highest body of this organization, so it is only appropriate that this issue be addressed at the GA level. Now, when it comes to UCMs, it would be no surprise that this is the chicken in the rice and chicken for a country like mine, unfortunately. I hope everyone had breakfast, by the way. Regarding this issue, I would have to state that it is clear that UCMs are contrary to international law and the UN Charter because they go against the basic tenet of equality among Member States. There is no right to impose UCMs under international law, none. They are based on a predatorial way of thinking. The language including on UCMs in the section is rather weak, I would have to say. It is not even the 2030 Agenda language, which is already weak enough. The 2030 Agenda language and the language also adopted in the Pact of the Future on UCMs does not indicate that all UCMs are contrary to international law and the Charter, which is what the victims of UCMs think, including my delegation. UCMs not in accordance with international law and the UN charter, and this is a quick reaction to something that was said yesterday by a couple of delegations, one of them the most imposing UCM sanc- UCM country in this organization, so the language that we have is already weak enough. and we would prefer stronger language in that regard. The impact of UCM is overwhelming and well documented by the United Nations system. You can just read the reports of the Secretary General and the Special Rapporteur of the Human Rights Council on the impact of UCM on human rights, which I have heard is an important element for some of my colleagues in the room. We have heard a lot of human rights language coming to the text, which is of course important. But if you are so committed to human rights, then you can read these reports and you will see how UCMs impact human rights. The Cuban case is very eloquent. Just between March 23 and February 24, one year, the US blockade against Cuba has cost over $5 billion, dollars that are needed for the electricity system, for critical infrastructure, for the health system, for education purposes. So it is clear that they impact human rights and sustainable development. Finally, asking the country that imposes UCMs if they are legitimate would be as irrational as asking a predator if it's okay to eat a gazelle. I am guessing that the gazelle and any other potential victim would have a different opinion. Fortunately, we are not in the jungle. In this House, we have rules to ensure that no one gets eaten, we just have to implement those rules. These rules are in place despite any irresponsible appetite or false exceptionalism, such as the ones that we have heard yesterday on this issue coming from the current tenant of the White House, his team or their predecessors. Thank you, facilitator.

I thank the distinguished representative of Cuba. Now I'd like to give the floor to the distinguished representative of United Kingdom, to be followed by the distinguished representative of Honduras.

Thank you, co-facilitator.

The UK recognizes the role of trade as an engine for inclusive and sustainable developments. No country has lifted itself out of poverty without increasing its trade with the world.

and the UK remains committed to supporting developing countries to harness the power of trade.

Trade creates jobs, stimulates investment, attracts technology, and generates foreign exchange to service debt and access global public goods. However, we must also recognize that these benefits have not been shared equally, and that significant challenges remain in allowing developing countries

to access the benefits of trade.

Today, the poorest three billion people have minimal, if any, involvement with global trade, whilst LDCs account for only one percent of global goods trade, less than half the target set in the SDGs. We support the call for WTO members to fully implement agreements on trade facilitations, fishery subsidies, and investment facilitation for developments. all of which have positive development impacts, as well as the

references to services and digital trade and the focus on LDCs.

On the specific paragraphs, on 42, the context in which policy space is used here is overly political and we don't support its inclusion. On 43, the term obsolete is not clearly defined within the statement and raising questions about its meaning and applicability. Our investment agreements reflect the negotiated priorities and intentions of state parties. On 43, we propose changing the end of the paragraph to read, we celebrate the enlargement of the WTO and recognize the contribution of accessions to strengthening the multilateral trading system. On 43, The language here is outdated and should be updated to text from the 13th Ministerial Conference agreed in 2024. On 43E, G, H, and I, we could remove these paragraphs to assist with streamlining. 43J, this should be aligned with the Nairobi Ministerial Decision. On 43K, This should include a reference to international solutions to carbon leakage. And on 44, 45, and 45 A and B, we can support. And finally, we note the substantial increase in discussion of trade and critical minerals and commodities since Addis,

and note that this could be streamlined.

So that said, we can support paragraph 46 C. Thank you, co-facilitator.

I thank the distinguished representative of the United Kingdom. Now I would like to give the floor to the distinguished representative of Honduras, to be followed by the distinguished representative of Paraguay.

Thank you, co facilitator. Trade wars have a major adverse impact on sustainable development, especially for the least developed countries. Protectionist measures don't just undermine global trade trends, they also increase the cost of technology, infrastructure and renewable energy, which are needed to foster sustainable development. The most vulnerable countries, which depend on international cooperation and access to international markets, are particularly affected, as they face additional trade barriers which hinder the implementation of development policies and the combating of climate change. Against this backdrop, we believe that the following are vital. First, for the document to take into account trade policies promoting openness and cooperation, and second, that the move towards regional trade integration should be seen as a strategic alternative vis vis protectionist measures. We also need to ensure that all countries, especially the most vulnerable, including middle income countries, can have sufficient political space to address domestic problems such as food insecurity and economic crises. without pressure from external trade policies limiting their room for manoeuvre. To do so, we would recognise that the document recognised that it is vital to make progress with dispute resolution mechanisms and investment with a multilateral approach, allowing there to be more equity in the global economic system. Thank you.

I thank the distinguished representative of Honduras. Now I'd like to give the floor to the distinguished representative of Paraguay to be followed by the distinguished representative of Dominican Republic.

Thank you,

co-facilitator. First and foremost. We believe that we should include the rise in subsidies within the threats which every day affect the multilateral trade system ever more. We also believe that we should advocate for full implementation of all WTO agreements, not just some, as is currently the case for this section. We are also of the view that, when it comes to references to the effective operationalisation of special and differential treatment, the reference to net food Importing developing countries should reflect current discussions in the relevant area. The list of these countries is currently under discussion at the WTO in the context of discussions on food security. Furthermore, given that the WTO is a member led organisation, we believe that the role assigned to the Director General of that organisation in paragraph is not within her remit. In terms of the section on political space, policy space for trade agreements, we believe that the reference to combating food insecurity is not correctly located because there isn't a specific paragraph on agriculture, but rather a general one. We also wish to clarify that, for my delegation, food security challenges are not necessarily resolved with greater policy space, but actually with further liberalisation of trade itself. Turning to the paragraph on trade restrictive and distorting measures, We would underscore that public stock holding with, uh, control prices, uh, when this has, um… food security purposes are subsidies which, by their very nature, are measures which distort trade, and we observe therefore an inconsistency between the title of the paragraph and its content. The language proposed in this paragraph only recognises one of the themes discussed within the agricultural negotiations of the WTO. Because of this, we're convinced that the language could be better balanced. The challenge of agricultural reform includes various other elements and, as such, my delegation is of the view that a call should be issued to conclude negotiations on all outstanding matters in the context of agricultural negotiations within the WTO. We believe that this would allow us to fulfil the members of all the interest of all Members in negotiations. Finally, in terms of the call to eliminate export subsidies, we would highlight that the WTO agreed in the 2015 Nairobi Ministerial Conference to eliminate these subsidies, and so that reference should be updated. I thank you.

I thank the distinguished representative of Paraguay. Now I would like to give the floor to the distinguished representative of the Dominican Republic, to be followed by the distinguished representative of Burundi.

Thank you very much, moderator. We would align with the statement delivered yesterday by the G77 China, and we would like to make a few individual points. Paragraph 43 in the section on multilateral trade systems through the WTO, we would suggest adding an element which would be increasing the WTO's capacity to sanction anti-competitive practices, including those coming from developed countries. Thank you.

I thank the distinguished representative of the Dominican Republic. Now I'd like to give the floor to the distinguished representative of Burundi, to be followed by the distinguished representative of Bangladesh.

Thank you, Mr. Chair, and good morning, everyone. We agree with the statements already made by G7+ China, as well as the African group on the accessibility of markets to developing countries. We often talk about free trade, but farmers and entrepreneurs in developing countries find themselves facing unfair competition due to agricultural policies of developed countries as well as tariff barriers which limits their access to global markets. I would like to thank the CAANIC team and in the draft in 43G, this mention of the elimination of all forms of subsidies on agricultural exports, which we are pleased with. We also would like to add after that sentence another sentence demonstrating commitment to the implementation of free trade measures. In addition,

There should be a

paragraph that demonstrates commitment to simplifying technical standards and environmental measures, taking into account that the procedure of access to the market should be simplified as well as lifting of tariff barriers. There also should be a paragraph that demonstrates commitment to modernizing the agricultural industry in developing countries in order to improve quality and competitiveness of the products. In closing, access to markets for our developing countries is a key prerequisite to our development and autonomous and long-term development.

Thank you.

I thank the distinguished representative of Burundi. Now I'd like to give the floor to the distinguished representative of Bangladesh, to be followed by the distinguished representative of Pakistan.

Thank you, Chair. Um, Bangladesh aligns itself with LDC and G77 and China, but we would like to suggest the following, following, you know, national capacity. In, um, the Chapeau paragraphs of 42 and 44, this contextualizes the importance of digital technology and digital skills. However, we do not see any actionable point that follows this particular contextualization. which in fact would empower the developing countries and LDCs to leverage the digital skills in promoting trade. With regard to export diversification, I mean in paragraph 43K and 45D, we welcome the reference to scaling up aid for trade, but we do not see any mention about any initiative for export diversification, which is of course important for LDCs, particularly the graduating ones for facilitating a smooth transition. In 44D, uh, we will propose a concessional trade financing window for the LDCs and graduating net importing LDCs, including for what has already been mentioned in this paragraph, that is the MSMEs, women, youth owned business, uh, in the context of supporting the transition phase. of LDCs and of course against the backdrop of, uh, climate shocks, uh, we are no stranger to the situation where worsening external foreign reserve balance of the LDCs affects the trade prospects, um, and of course this can also help us addressing some aspects of risk ratings without raising potential procedure, procedural concerns that we heard from some of the colleagues. In 44a, this mentions about trade corridor development and 45d mentions about trade infrastructure, of course, but the text do not mention about the importance of trade connectivity, in fact, interconnectivity, which is more of an inclusive approach, of course, and most importantly, this was part of the above action agenda, so we would request to retain that part. Regarding agriculture subsidy and fisheries subsidy, in 42k, We refer to the 2015 Nairobi WTO Ministerial Decision on Export Competition and Article 9.4 of the Agreement on Agriculture, which states that the LDCs and net food importing developing countries shall continue to benefit from the provisions of the agreement until the end of 2030. And in line with the spirit of 45A, we would rather want to see the document extending this provision to the graduating LDCs. for a extended period of time. Uh, in the same vein in 43B, we would also request avoid calling for the implementation of fisheries subsidies agreement, which is of course yet to be operationalized. We note the reference to trade related environment measures in 42K. If the purpose is to support the climate action, any such discussion should fully embody the principle of CBD-RRC. And we would also like to request to clarify the source of reference to the terminology trade-related environment measures. We'll provide a written submission. Thank you, Chair.

I thank the distinguished representative of Bangladesh. Now I'd like to give the floor to the distinguished representative of Pakistan, to be followed by the distinguished representative from Reasons, Refocus and Society for International Development.

Thank you, facilitators. We align with the statement delivered by Iran on behalf of the G77 and China. We echo their requests to ensure that the qualifiers used when referring to the multilateral trading system are consistent throughout the text. We would suggest rephrasing 43D for it to read net food importing developing countries consistent with the terminology used in WTO. We do support this paragraph in general. We request the deletion of 43e. We are not sure that this falls within the remit of the mandate of the WTO Director-General to undertake such a review, so we request its deletion. We propose the addition of an EBIS, a dedicated paragraph on ensuring that trade agreements incorporate reasonable inbuilt and readily available flexibilities for developing countries and LDCs to address crisis situations. We will send the entire proposal in writing. We strongly support the subsection on policy space in trade agreements. Um, if there's a desire to focus this only on investment agreements, we are flexible and, and echo the G77's comment on maybe making this a standalone, um, section on policy space and investment agreements, um, we support, uh, 43G, um, and would request its, its retention. We, uh, although the latter part of it needs to be, uh, more clear on when we talk about remaining consistent with relevant international rules and commitments, uh, we need to be clear we're referring to WTO rules and commitments. We support 43H on reform to the mechanisms for investor state dispute settlements through a multilateral approach. And we would propose that the latter part of the paragraph be split into an HBIS so that there's a general commitment to undertake reform to the mechanisms. And then there is a dedicated commitment to establishing an advisory support service for developing countries for international investment dispute settlements. We support 43I. We heard there were queries on what is the role of UNCTAD in this. I believe UNCTAD has an investment policy hub which provides capacity building support to developing countries on ISDS. And we would actually propose strengthening I instead of building on existing efforts, we would change it to calling for scaling up efforts by all stakeholders, including by UNCTAD. And we strongly support the retention of the reference to replacement and termination termination of obsolete investment agreements. We can look at other phrases outdated, perhaps, if that works. But it is a fact that old investment agreements with Ists provisions are hampering the efforts of developing countries to achieve sustainable development. And then we would. Proposed strengthening K, we will send our proposal in writing. On 44C, we support 44C. It is language from Addis, so we would request that this not be changed to add other institutions since this is verbatim language from Addis. In E, we request that the listing of disaggregated data be made consistent with that of use in FFD outcome documents. And lastly, we request the deletion of 46B. We are not sure why a specific recommendation was picked up from the SG panel on critical minerals. There is no clarity on who will develop such a framework. We cannot support this recommendation. We can go with A, which talks about supporting value-added activities, but not with 46B regarding to a traceability framework. Thank you.

I thank the distinguished representative of Pakistan. Now I'd like to give the floor to the distinguished representative of Regions Refocus and Society for International Development to be followed by the distinguished representative from Third World Network.

Thank you, Chair. My name is Erica Levinson and I speak now on behalf of Regions Refocus and the CSO FFD mechanism. The purpose of trade multilateralism has been since its inception to act as an engine of development. Following the human capabilities approach to development, the purpose of trade should therefore be to increase the capabilities of people. However, chronic trade deficits of global south countries, deteriorating terms of trade for primary commodity producers, and… Fundamentally undemocratic trade multilateralism have instead degraded the lives of many people in developing countries and in particular women. In this sense, and despite growth in gross domestic product, trade multilateralism has failed to meet its purpose. We agree with paragraph 42's assessment that open, fair, predictable, and we would add democratic and rules-based multilateral trade is under threat. However, we must qualify this threat. The move from multilateral to bilateral trade agreements and governance facilitated by global north countries and retaliatory trade measures by these same countries the biggest threats. Policies deployed to nurture infant industries and domestic markets are not the enemy and play a vital role in the long-term development and structural transformation of countries. This is clear when looking back into history at the industrialization strategy of now developed countries who have contributed the bulk of historic carbon emissions. While there is the need to adapt trade to align with the remaining carbon budget and planetary boundaries, developing countries must retain policy space to develop their economies in light of climate constraints at their own pace and in their own ways while addressing social concerns in line with the principle of common but differentiated responsibility. We would add to paragraph 42 that inappropriate trade policies have outsized negative impacts on women, girls, and other marginalized constituencies. Predatory or insensitive trade policies drive countries deeper into debt and push women and girls further into the margins, including by exacerbating their burdens of unpaid care work, which current trade rules fail to recognize. Trade has profound negative impacts on every aspect of women and girls' lives, exacerbating and creating inequalities based on hierarchies of class, race, ethnicity, sexual orientation, and gender identity. Moving on to paragraph 43, the zero draft places too much emphasis on the WTO. We must move beyond the reductionist notion that trade multilateralism begins and ends with the WTO and revitalize and democratize the entire multilateral trading system, including the WTO. This means adopting an ecosystem approach that includes the UN General Assembly, ECOSOC, and UNCTAD's Trade and Development Board. The call to implement the WTO agreements on fisheries subsidies and investment facilitation in paragraph 43B is premature. We echo the G77 and China's reminder that these agreements have not been adopted or ratified yet. Instead, we call on WTO members to address the implementation issues raised by developing countries, including through capacity building. Furthermore, we urge member states to raise the ambition of paragraph 43C and call on WTO members to deliver an improved, fair, and equitable dispute settlement system that works for all countries, especially developing countries and LDCs, by the 14th WTO Ministerial Conference in 2026. We strongly support special and differential treatment addressed by paragraph 43D and assert that it is a core tenet of trade multilateralism. Because of this centrality, we must go one step further and institutionalize this principle beyond the confines of the WTO. We call for multilateral agreement under the UN that reaffirms, updates, and strengthens special and differential treatment in a precise, effective, and operational way for developing countries, in particular, LDCs, LLDCs, and SIDS in all trade agreements. Urgent change is needed, and FFD4 is one of our last hopes in achieving any part of the 2030 agenda. Trade must be reoriented as a tool to reduce inequality, to honor the right to development, and to empower developing countries to achieve their national priorities and meet the needs of their populations, including climate and gender justice. Thank you.

I thank the distinguished representative of Regions Refocused and Society for International Development. Now I'd like to give the floor to the Third World Network to be followed by the distinguished representative of Chile.

Thank you, Chair. My name is Ranja Sengupta and I speak on behalf of both the Third World Network and the CSO FFD mechanism. We strongly support both paragraphs 43 and 43 on trade related environment measures including unilateral trade measures. On 43 we urge the UN members to show higher ambition and call for the immediate termination of unilateral economic, financial or trade measures that are inconsistent with the principles of international law and the charter of the UN or those that create adverse impact on development of the target country. Further, any measure premised on sustainability must be based on the principle of common but differentiated responsibility, multilaterally agreed, transparent, democratic and balance the three dimensions of sustainable development. We also strongly support paragraph 43G. Policy space for resilience building, structural transformation, industrialization, food security and sustainable development is critical for developing countries and LDCs whose development gap from developed countries continue to be massive. Therefore, this paragraph must be reserved exclusively for them as it was in the elements paper. In addition, the required policy space cannot be ensured within the current trade rules and commitments. If it was, then perhaps this paragraph would not even be needed. It is essential that trade rules and commitments are reshaped to ensure policy space for pursuing such goals. We fully support the spirit of paragraph 43H on ISDS reform, but call for much higher ambition. Given the adverse impact of the ISDS on the policy space of both global north and global south countries, we think FFD4 offers the opportune moment to reach a multilateral agreement for the coordinated and permanent cessation of ISDS provisions in trade and investment agreements. We very much support para 43J on the permanent solution on public stockholding as it is long overdue and this will also ensure food security and nutrition and protect livelihoods of farmers including smallholders and women farmers across the global south. On 44B, we have some concerns given the significant digital divide between developed and developing countries and the need for policy space regarding domestic policies related to digital industrialization, data, digital taxation, Uh, in developing countries and LDCs, therefore they should retain full policy space for domestic policy making in a manner that does not undermine but strengthens domestic providers and suppliers of these services in these countries. The full section on LDCs is very pertinent and we fully support it. And in particular, we agree with the LDCs group position in the WTO on a longer transition period for graduating LDCs compared to the measly three years that is being currently offered in the WTO. Their own assessment of their capacity to deal with the loss of preferences must be respected and the period should be self-determined. On regional trade integration under para 43F, we suggest it be restricted to South-South agreements only in order to promote inclusive growth and sustainable development within developing countries and in their LDC partner countries, and also there's the need to ensure that South-South trade agreements are not undermined by bilateral North-South trade agreements. FFD4 must aim for a trade framework that is democratic and works for development. It must also work for marginalised communities, women, workers, patients, indigenous groups, and in a genuine and effective manner by addressing real issues and not using these issues for commercial gains. This also means that for an effective outcome on the trade section, the process of negotiations must be fair, transparent and participatory, and CSOs which are intrinsically connected to such communities on the ground must be allowed to fully contribute. contribute their expertise.

I thank the distinguished representative of Third World Network. Now I would like to give the floor to the distinguished representative of Chile, to be followed by the distinguished representative of Southern and Eastern African Trade Information and Negotiations Institute.

Thank you very much, co-facilitator. We'd like to align with the statement of the G77 and China and add what follows in our national capacity. Paragraph 43 and the mention of regional and bilateral trade agreements. We don't agree with this being added here and we would ask for this language to be deleted. We would recall that regional agreements should be notified to the WTO. Additionally, the WTO's member states' trade policies and their compatibility with international law are linked to the ongoing work of the WTO's various bodies. In the subsection on the multilateral trading system, we would suggest adding a new subparagraph calling upon WTO members to make progress with the agriculture reforms under Article 20. to address urgent challenges such as climate change, biodiversity loss, food insecurity and desertification. We will send a detailed proposal in writing. Subparagraph b, we would suggest language to take into account that the agreement on fisheries hasn't yet entered into force. We also recognize the value of special and differential treatment, but we do not think that we should review agreements to extend those disciplines. Finally, on sub-paragraphs h and i on investor-state disputes, we would highlight the importance of the regulatory capacity of states and we would point to the progress that has been made multilaterally in that area. However, we would also stress that that is currently under negotiation. Thank you.

I thank the distinguished representative of Chile. Now I'd like to give the floor to the distinguished representative of Southern and Eastern African Trade Information and Negotiations Institute, to be followed by the distinguished representative from International Chamber of Commerce.

Thank you, Mr. Chair. You gave me the floor, but I think it's the colleague first.

Thank you, Chair. My name is Jane Narunga from Siatini speaking on behalf of the FFD civil society mechanism. My input refers to the critical minerals section. We have concerns about the section and can support it if it unambiguously protects the sovereignty of developing countries over these resources and strengthens the policy space for the use of these resources for the structure transformation, economic sovereignty, and sustainable development. The chapeau to para 46 should include the need for trade and investment policy flexibility to ensure domestic development and value addition from the use of such critical minerals and for pursuing sustainable objectives. Para 46A, we propose to include the following, resource rich countries. countries and LDCs must have full policy flexibility to determine their trade and investment policy with regard to their critical minerals to ensure transparent, equitable and optimal exploitation and beneficiation of mineral resources for the development of renewable energy and contribute to structured economic transformation and sustainable development. We support the call to development partners and international financial institutions to support developing an LDC regarding the mineral exploitation. However, the para should clearly indicate the kind of support and also indicate that they should support nationally owned and controlled production, refining and processing of critical minerals within those countries. Para 46b, we welcome the development of a global traceability, transparency, and accountability framework. This framework should strengthen the due diligence of transnational corporations, facilitate corporate regulation and accountability, and uphold environmental and human rights commitment, especially of local communities. That framework should not be used as a unilateral trade barrier. We welcome the support to developing countries to negotiate commodity contracts as provided in para 46D. However, we reiterate that governments must have the full policy space to design their trade and investment policies around their critical minerals, to pursue the necessary industrial policies in order to exit the commodity trap. Regarding para 46e, we would like to add the following statement to ensure publicly accessible information and accountability of the extractive industries, allowing for public oversight and independent monitoring, including by local communities, to prevent revenue losses in the countries where the resources are extracted from. I thank you, Chair.

I thank the distinguished representative of Southern and Eastern African Trade Information and Negotiations Institute. Now I'd like to give the floor to the distinguished representative of International Chamber of Commerce.

Thank you very much, Mr. Chair. As ICC, we consider the section on international trade as an engine for development very important to the global business community. The section includes several concrete actions and innovations that align with our priorities. In this intervention, we would like to emphasize the following areas. On paragraph 42 and the chapter of 43, we welcome the strong commitment to open and fair markets for trade and investment and a rule-based international trading system anchoring a fully functioning world trade organizations. Businesses globally need stability, transparency and predictability to make informed long-term trade, business and investment decisions and to deliver the goods, services and solutions needed for a sustainable future. With regard to some of the challenges of the international trading system outlined, we would like to put particular emphasis on the importance of 43K and L on addressing challenges and the potential severe negative impacts of trade-related environmental measures. We have continuously called for the careful design and implementation simplifications with regards to such measures, including for carbon border adjustment mechanism to alleviate significant administrative burdens and compliance costs, in particular for small enterprises and in developing and emerging economies. We welcome the invitation to ECOSOC IFFD forum to consider the impact of sustainable development of such measures, but we believe the tax needs to go beyond that. As several economies are developing or considering carbon border levies or similar mechanisms, we strongly believe that an inclusive global engagement on this important agenda, including parties to the UNFCCC and WTO members, is urgently needed to avoid a patchwork of uncoordinated national interventions. While it is important to reflect on the challenges of the current international trading system and addressing these, it is even more important to recognize also the opportunities and potential of trade and environment working together. to achieve a sustainable future and protect our planet and nature. For instance, one being circular economy. Coordinated action is crucial in advancing the circular economy, where trade plays a transformative role. This is, without a doubt, a complex area, but it's interesting to see how often the barriers come down to misaligned trade, regulatory and custom policies. A second area is eliminating barriers to trade in key environmental goods that should be viewed as an overarching priority to speed the flow of green technologies to places in the world that need them most. The ACCTS agreement signed by Costa Rica, Iceland, New Zealand, and Switzerland is an important step forward, and we hope this can spur some momentum in this space. We will welcome a reflection on these areas that have the potential to advance our development and environment objectives. Finally, we would also like to highlight the importance of trade finance. important ongoing efforts such as the ICC principles for sustainable trade and trade finance can provide a useful in foundations in accelerating the alignment of the US, um, 10,000 trillion trade finance market with the global development goals and have the potential to allow for much broader adoption of common sustainability principles for trade and trade financing. I thank you.

I thank the distinguished representative of International Chamber of Commerce. excellencies distinguished delegates we have heard the last speaker in the section now i would like to request the permanent representative of norway her excellency merete to continue the reading of the next section on date and debt sustainability i thank you.

Thank you very much, Karl. Good morning, everybody. We will now start to hear comments on the section on debt and debt sustainability, paragraphs 47 to 51. You know what to do, press the button and approach us if you are speaking on behalf of a group so that we can give you precedence in the order of speakers. reminding you seven minutes for groups, four minutes for everyone else, and the microphone will be cut off. And it looks like it's going to be a long list of speakers, so I will inform you when I cut the list off. Now, I have talked long enough to be able to, I think, give the floor to the first speaker, which was the Philippines, but on behalf of middle-income countries, to be followed by the representative of Bangladesh on behalf of the LDCs. So, Philippines, you have the floor.

Thank you, facilitator. I delivered this intervention on behalf of the like-minded group of of countries for middle income countries composed of Armenia, Belarus, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Jamaica, Lebanon, Mexico, Morocco, Namibia, Panama, Peru, the Philippines, and Uruguay. This whole chapter doesn't have even just a single reference to middle income countries. The Secretary General's report on debt sustainability and development in 2023 found that the debt servicing of middle-income countries reached the ratio of around 13% of total exports in 2022 and recognized that nearly a third of middle-income countries are at high risk of fiscal crisis. Unfortunately, the succeeding report left out middle-income countries, which discontinued the monitoring of the debt sustainability situations of middle-income countries. We express concern with the way the chapter is premised. It begins with a reference to borrowing, which must be prudently managed, and connects it to a reference to responsible borrowing and lending. With this, it shapes the narrative that debt sustainability challenges are primarily the responsibility of the borrowers, and that it tends to imply that these are caused by irresponsible borrowing. Therefore, we propose to balance the narrative by recognizing that debt sustainability depends on a confluence of many factors beyond effective debt management at the international and national levels, and emphasizing that country-specific circumstances and the impact of external shocks such as volatile commodity and energy prices, more intense and frequent disasters, and volatile international capital flows, Rising cost of capital, spillover negative impacts of macroeconomic policies should continue to be taken into account in debt sustainability analysis. On fiscal space for investment in countries facing debt challenges, we propose to change the title to fiscal space for investment in sustainable development. The considerations under this subsection should address the debt challenges as well as the consideration of alternatives to mobilize additional resources and incentivize public investment in global public goods and SDGs. We express our support to the proposal in 49b on requesting an existing facility to provide systemic support to developing countries to inter alia develop innovative financing mechanisms such as debt swaps. We support the list of challenges that should be addressed when it comes to these instruments and would like to add to the list the need to ensure country ownership and transparency in these operations. We are also of the view that debt swaps for climate in nature deserve a special focus. We would want to see commitments to the provision of support specifically for middle income countries in addressing their liquidity challenges. The zero draft focuses on existing frameworks that are already available to other group of countries, and we believe we should address what is lacking in the status quo moving forward. On debt architecture for debt crisis resolution, we would want the reflection of middle-income countries in the reference to strengthening the common framework. Middle-income countries are the only group of countries that are included in the common framework. Moreover, in improving the common framework, Standardizing debt service suspension should be explicit on automatic debt service standstill to alleviate liquidity constraints, avoid the accumulation of areas, and incentivize quicker resolutions. Finally, on debt sustainability assessments, we support the proposal to integrate climate and nature risk in the exercise as referenced in paragraph 51A. However, the need to advance this purpose should not be limited to the views of the World Bank and IMF. We would like therefore to introduce a reference to the recommendations of the independent expert review on debt, climate and nature so this can be taken into account in this effort. Thank you.

I thank the representative of the Philippines and now give the floor to the representative of Bangladesh on behalf of the LDCs. to be followed by the representative of Egypt on behalf of the Africa Group. And the list of speakers will be closed during Bangladesh's intervention. You have the floor, sir.

Thank you, Chair. Bangladesh has the honor to make the remarks on behalf of the Least Developed Countries, LDCs. We align ourselves with the statement delivered on behalf of the G77 and China. The debt situation in LDCs has reached alarming levels in recent years, exacerbated by the COVID-19 pandemic. External debt service payments in LDCs increased by 35% in 2022 compared to 2021, reaching approximately $44 billion, the highest level ever recorded. Such a rising debt burden in LDCs threatens long term economic stability, especially as countries face overlapping crisis and rising interest rates. Without decisive action, LDCs risk falling into debt trap, marked by dwindling fiscal space and diminished opportunities to meet their sustainable development needs. We welcome many elements in the zero draft outcome document that address debt sustainability concerns. In particular, we strongly support retaining paragraph 48A, which calls on the United Nations Secretary General to create a working group to develop principles on responsible sovereign lending and borrowing. This is crucial for establishing clear guidelines and promoting transparency in debt management. However, we strongly suggest using language, building the UNCTAD principles on sovereign borrowing lending in this paragraph. We also emphasize the importance of paragraph 48 which calls for standardized state contingent clauses in loan and debt contracts. These clauses are essential for ensuring debt service standstills during crisis not covered by standard force majeure provisions, providing much needed flexibility for LDCs facing economic shocks. Paragraph 48E's encouragement for official lenders to increase lending in local currencies is a step in the right direction. However, given the significant risks posed by foreign currency borrowing for LDCs, we propose strengthening this language to a firm commitment rather than just encouragement. We strongly support paragraph 49A's call for efforts to lower borrowing costs. We call for the full implementation of the Debt Service Suspension Initiative, DSSI, and its extension, as well as the effective implementation of the common framework for debt treatments beyond the DSSI. We urge expanding DSS eligibility to cover all LDCs as this would provide critical support for debt management and sustainability. The recognition in paragraph 50 that current debt architecture is not fit for purpose is crucial. We firmly support the call in paragraphs 50e to initiate an intergovernmental process at the United Nations to address gaps in the debt architecture and explore options for enhancing debt sustainability, including a potential multilateral sovereign debt mechanism. We also urge creditors and debtors to engage in constructive negotiations to find durable solutions to the debt challenges of the LDCs, including through debt cancellation to create fiscal space for investment in sustainable development and climate action. We welcome paragraph 49b's proposal for an institutional home within an existing international financial institution to provide systemic debt management support. This would help streamline and coordinate debt-related assistance for LDCs. Furthermore, we suggest strengthening paragraph 53 on IFI governance framework reform. The current proposals, while welcome, do not go far enough in addressing the underrepresentation of LDCs in decision-making process. we call for more ambitious reforms that ensure ldc's have a meaningful voice in shaping global economic policies that directly affect them. paragraph fifty four is called to review special drawing rights sdr's through the imf board of governors is important. However, we believe this section should be strengthened. We propose including a specific commitment from developed countries to rechannel at least $100 billion in SDRs allocation to LDCs on concessional terms. This would provide much needed liquidity support for LDCs facing economic challenges. While the document outlines many positive areas, we believe some critical issues need to be considered. Drawing from the Doha Programme of Action, we strongly urge the international community to take more ambitious and decisive action on debt relief for LDCs and propose to suggest appropriate language in the text. We propose including a call for the establishment of a high-level commission at the United Nations to develop concrete proposals for governance reforms at international financial institutions. This commission should operate independently of the G20 and IFIs to ensure a fresh perspective and inclusive representation. In conclusion, while the zero draft provides a solid foundation, we believe these additional elements and strengthened commitments are essential for creating a more equitable and sustainable global financial system that truly addresses the needs of LDCs. We look forward to working constructively. Thank you once again on behalf of LDCs Chair.

I thank the representative of Bangladesh and I now give the floor to the representative of Egypt on behalf of the Africa Group to be followed by the representative of the European Union. Egypt, you have the floor.

Thank you, Madam Co-facilitator. I have the honor to deliver the statement on behalf of the African Group. In paragraph 54B, suspending IMF surcharges is highlighted, but only during disasters and exogenous shocks. There's a need to consider suspending these surcharges for countries at high risk of or already in debt distress until the review is carried out. By leveraging SDRs either as collateral for concession and financing or through voluntary transfers from advanced economies, debt relief efforts would be more efficient and provide much needed fiscal space for countries. We also propose to include a bullet point on encouraging both official and commercial lenders to increase lending in fixed interest rates, debt instruments to address the interest rate risks. The FFD four outcome document should underline the importance of reforms to existing multilateral debt resolution processes, including the G20 common framework to facilitate timely collective action to prevent debt crises. We would like to reiterate our call for the establishment of a multilateral sovereign debt workout mechanism aligned with sustainable development and the creation of a global debt authority, uh, to oversee this, uh, mechanism and promote substantive reforms in sovereign, uh, debt management. I will now add a few points in my national capacities, capacity since we still have time. In paragraph 47, we ask for the deletion of the caveat when prudently managed after the reference to borrowing in the first line, since this could suggest that global shocks and externalities such as rising interest rates or pandemics, for example, don't affect high and unsustainable debt burdens. We acknowledge The inclusion of the reference to highly indebted countries which are currently ineligible in paragraph 50A when referring to the G20 common framework and ask that this be maintained, but consider that the call for the reform of the G20 common framework should be strengthened by replacing strengthen the common framework to become reform. the common framework and replace encourage by calls for reforming. In paragraph 50e, we acknowledge the reference to multilateral sovereign debt mechanism and hope this is maintained. We, however, would like to delete the listing of the documents and processes on which this intergovernmental process would build on to avoid preempting the process and to leave all options open. So we would like to delete starting the review in the first line till the progress and proposals in the second line. So the paragraph would read, building on existing work, we will initiate an intergovernmental process at the UN, and it goes on. On the call for establishing a multilateral sovereign debt workout mechanism, we consider that it would, for example, help align debt restructuring efforts with the borrower country's goals for sustainable development and provide a forum for negotiating the borrower's proposed debt restructuring plans. On the proposal for the creation of a global debt authority, we envisage that it would oversee the workout mechanism and facilitate substantive statutory and contractual reforms in sovereign debt management. This would include issues such as advice on tools to incentivize private creditors participation and the borrowers club where debtor countries with recent experience in debt restructuring could share experiences. It would also strengthen contractor and legislative provisions to standardize debt restructurings, including, for example, by assisting member states in designing state contingent debt clauses and defining soft law principles to establish an effective, timely, orderly, and fair sovereign debt architecture. we therefore propose that the mandates mentioned in paragraph forty nine b for an institution within an existing ifi facility become part of the mandates of the proposed global debt authority. in paragraphs forty nine and fifty we acknowledge the references to a development oriented debt architecture and ask that these be maintained in the text going forward. i thank you.

I thank the representative of Egypt and now give the floor to the representative of the European Union, to be followed by the representative of Palau on behalf of AOSIS. European Union, you have the floor.

Thank you, Excellency. Good morning, colleagues. I first have the pleasure of speaking on behalf of the European Union and its 27 member states, and I have a few general comments on the debt-related chapter. So for us, this is a really critical chapter, and the EU and its member states are very supportive of ambitious, realistic actions that add value and build on what is already there and being done and making use of the different roles, mandates, and achievements of different players, including G20, Paris Club, World Bank, IMF, and many others. The UN has a convening power like no other, so we should definitely not lose this opportunity to create synergies and fill in gaps to address this existential issue that many developing countries are grappling with. So I'll offer some initial detailed observations, but in this chapter we have also a number of reservations that we hope to discuss further. So we have a very positive initial assessment, but hope to continue discussions within the room and outside on many of these proposals. And the first one is on paragraph 47. We should aim for consistent terminology across the text. So in this paragraph alone, we have debt workouts, debt restructuring, and debt relief without entire clarity on what is meant by each of them. We would propose to add here a factual reference to the challenges faced by SIDS and LDCs in terms of being amongst the countries most vulnerable to and actively experiencing debt crises. And we'll suggest some language in this vein. Some of the phrasing here, nevertheless, is we consider somewhat inappropriate. For example, too little, too late, is somewhat disrespectful maybe to what is already being, the efforts that are already ongoing. So some recent restructurings, for example, under common framework took too long. We know that. However, it's an entirely new process and it took time to build trust between Paris Club creditors and emerging creditors from G20 countries that are not part of the Paris Club. So everything possible is being done to improve this process, which exists, has yielded results and is continuously improving. Furthermore, too late sometimes stems from the debtor country, as frequently debtors seek to delay restructuring, possibly for political reasons or to avoid market signals. In this paragraph, we also would suggest to add that debt relief initiatives should incorporate mechanisms that prioritize investments in the SDGs, particularly green and inclusive growth sectors. In paragraph 48A, we have the broader comment, which is that while we don't have a negative assessment as such, we reserve on this paragraph and some others that are similar or related to it. support consideration for broad inclusivity of the kind of dialogue that is being proposed, so including G20, Paris Club, and all other relevant stakeholders. But for the time being, we would ask to have a discussion first on what format this working group or dialogue or other format would take, what part it would play in the package of debt initiatives and actions that we will include in this outcome document. that should address different aspects of debt prevention, debt sustainability, and debt resolution. So we would like to continue discussing this idea in a broader sense on the value added of establishing a new group or a dialogue, who would take part and what the exact role, mandate, and output could be. In paragraph 48B, we agree with the idea of a commitment to increase transparency and accountability for debt issuance as well as its use. especially through parliamentary oversight and strengthen public investment management systems. And we have language to propose. And we also have language to propose on enhancing transparency on debt and the associated investments, indirect or direct through budget allocations, public procurement, public debt data and public expenditures. We would also commit to exploring opportunities for enforcing debt transparency in both creditor and debtor countries. I'm afraid I'm going to run out of time with my comments here. So in paragraph 48C, we're not convinced of the value added of creating new global central debt registry, but rather completeness and accuracy of existing ones. Paragraph 48 lending in local currency. We have some questions around that and it's not always possible for public creditors. In paragraph 48 we certainly support action against corrupt lending, but we think any protocol should be discussed in UNCAC first. Paragraph 48 we may propose new language on vulture funds. Paragraph 48G, we see the merit of proposing borrower countries having stronger engagement, but like 48A, we think this could be discussed as part of a package. On paragraph 49A, we definitely support the mention of DSSS, but we would caution against jumping to language on operationalization and expansion before we have an opportunity to discuss this. So hope to further debate this. We have some technical edits to various paragraphs, 49B, 50, and 50A. And 50B would ask for clarification of terminology. And 50C on collective action clauses, we're not convinced by the value added of the proposal there and would seek an assessment by experts to support discussions. Paragraph 50E, we would need to clarify such a process and at this point ask to delete this paragraph. Paragraph 51, we need to respect the integrity and independence of credit rating agencies and would have several comments to this paragraph. And 51A, we would ask to nuance the language. And in 51B, again, stress the importance of all debtors to provide transparent and accurate data to promote transparent, accurate, objective, and long-term model-based credit assessments. We also have questions on the pragmatism of this proposal since DSAs provided by IFIs serve a different role than credit rating agencies and would also appreciate continuing to discuss this. So we have a number of proposals and linguistic edits and questions that we will forward to you in writing.

Thank you. I thank the representative of the European Union. And before giving the floor to the representative of Palau on behalf of AOSIS, let me just remind you that we did close the speakers list during Bangladesh's intervention. So no further inscriptions will be accepted. We have 33 more speakers to listen to before 1:00. So, Palau, you have the floor on behalf of AOSIS, to be followed by Saudi Arabia.

Thank you for giving me the floor, Madam Ambassador. I have the honor to present the comments of the 38 members of the Alliance of Small Island States on this section. Debt and debt sustainability is central to the outcome document for the fourth international conference. AOSIS is deeply concerned that unless urgent, concrete and deliberate actions are taken to address debt distress, the international community will fail to achieve the SDGs. In fact, without addressing the structural and systemic debt challenges, the commitments in this outcome document will remain hollow, and SIDS development prospects will remain severely compromised. It is easy to push the narrative that incurring debt is a policy decision undertaken by governments. But for SIDS, the debt burdens we face are often the result of external actions, decisions, events, and practices beyond our control. Since the COVID-19 pandemic, SIDS external debt rose from 42.3% of GDP to around 60% in 2022. Many of our debts have continued to rise, due to global economic shocks, volatile commodity prices, and more critically, the actions of others that have directly contributed to the vulnerabilities of SIDS. The devastating impacts of climate change, rising sea levels, and exogenous shocks creates a vicious debt cycle that makes it exceedingly difficult for SIDS to invest in long-term resilience, poverty reduction, or sustainable development. It also exacerbates the vulnerability of SIDS to future shocks as they are increasingly trapped in a system of debt and dependence, unable to fully realize their developmental potential. For this reason, EOSIS's approach is anchored in our conviction that we cannot afford to allow these challenges to remain unaddressed. On this point, our group will propose language that illustrates the impact of disasters and climate change in pushing debt to unsustainable levels, especially in LDCs and SIDS in paragraph 47. We would present language on the need for innovative debt instruments that allow developing countries to reduce debt distress, build resilience, free fiscal space for investments, and foster stronger partnerships between creditor and debtor countries. On paragraph 48, EOSIS looks favourably at the request to the Secretary-General to create a working group. However, we believe that such a working group should be created in consultation with Member States and build on relevant principles and guidelines. Further, the principles developed by the working group should also be submitted to the General Assembly for its consideration and appropriate action. EOSIS also welcomes paragraph 48d, I will make some proposals to strengthen the language further, as these tools should be tailored rather than standardized across all lending, including climate resilient debt clauses. These clauses should ensure debt service suspensions and reductions in times of crises, disasters, and shocks, especially when lending to developing countries vulnerable to natural hazards and the impacts of climate change. On paragraph 49a, EOSIS welcomes the call for the operationalization of the DSSS. To strengthen the proposal, we will suggest a standalone paragraph on the DSSS, bringing the language closer to that contained in the Antigua and Barbuda agenda for SIDS, and we remain open to considering the expansion of its eligibility to cover other developing countries, including the LDCs. Further on paragraph b, it is our understanding that the language regarding an institutional home is in relation to the DSSS and would present a minor edit to make this significantly clearer. On paragraph 50, EOSIS sees value in the common framework, but a stronger call, as echoed by many countries today, should be made on the G20 to expand debt treatments to highly indebted countries including SIDS, which are currently ineligible. IOSIS will also introduce two additional paragraphs on increasing access to concessional finance and grants by integrating vulnerability and climate and nature risk into eligibility criteria, as well as in efforts to enhance debt sustainability and strengthen debt restructuring mechanisms. On paragraph 50E, IOSIS welcomes the proposal regarding the initiation of an intergovernmental process to deliberately address debt sustainability. We believe that given its universal membership, the UN is well poised to discuss this issue in depth. However, given the urgent distress that SIDS and many other developing countries find themselves in, EOSIS is of the view that this proposal can be stronger, clearer, and more direct with a dedicated timeline. We would therefore propose initiating an intergovernmental process at the United Nations under the General Assembly in its 80th session to establish an international convention which includes a multilateral sovereign debt mechanism. Lastly, on paragraph 51, EOSIS will propose that the IMF and World Bank refine that sustainability assessments to better account for sustainable development spending needs which can go beyond the SDGs and account for those groups of countries that are implementing their respective programs of action. would also add a reference to consider multidimensional vulnerabilities. We should also indicate that these revisions are to be carried out in an exclusive manner. On paragraph b, EOSIS will also include a reference to restructuring and relief programs, as countries should not be penalized or downgraded should they make use of such tools that are available to them. In closing, we urge all member states to join us in pursuing comprehensive long-term solutions to debt sustainability, recognizing that debt relief is not merely an economic issue, it is a matter of justice and human dignity. SIDS have not created the circumstances that have led to our debt burdens, but we are determined to overcome these challenges with your support. Thank you, Madam Ambassador.

I thank the representative of Palau and now give the floor to the representative of Saudi Arabia to be followed by the representative of Yemen. Saudi Arabia, please.

Thank you very much, Madam co-facilitator. In paragraphs 49 and 50, the draft should focus on strengthening and streamlining existing debt treatment frameworks instead of creating new ones. In paragraph 50a, The point is beyond the mandate of the UN and the agreed common framework terms of reference. Also, the point discussed issues that should only be discussed on a case-by-case basis within common framework committees. We request to delete the whole point. And for the same reason, we also request to delete paragraph 50e. In 51, the draft should ensure discussions on credit ratings remain within financial regulatory bodies and focus on transparency and objectivity. In 51a, we request to delete the sentence, quote, better capture climate and nature risk, end quote. as the current risk assessment practices take presumptuous approaches in the assessment of climate and nature risk, yielding distorted outcomes in risk pricing. Debt restructuring should remain a sovereign decision supported by voluntary mechanisms. While Saudi Arabia supports international cooperation on debt sustainability, any framework for restructuring should be country-led and voluntary. Expanding multilateral debt mechanisms should not diminish the flexibility of debtor countries to manage their own debt strategies. The document should reinforce that existing debt restructuring mechanisms within the IMF, World Bank, and G20 remain the primary avenues for engagement rather than introducing prescriptive solutions. Thank you.

I thank the representative of Saudi Arabia and now give the floor to the representative of Yemen to be followed by the representative of Colombia. Yemen, you have the floor.

Thank you, Your Excellency.

Yemen aligns itself with the statement delivered by the LDDC and the statement delivered by the G77 and China. As a country facing several debt challenges, we offer the following specific comments on our capacity. On Article 47, we request recognition that external debt payment have rich and sustainable levels, we call for adding reference to compound impact of multiple crises, we urge inclusion of rising interest rate challenges, we request addition of data showing increased debt surface burden, reduced physical space for development and impact on essential services. On paragraph 48A, we support establishment of UN working group and request specific reference to building on UNCTAD principles with clear implementation timeline. In paragraph 48D, we strongly support state contingent close to ensure that surface standstills during times of crisis and request mandatory rather than voluntary provisions with implementation support mechanism. In paragraph 48e, we support local currency lending and request strengthening from encourage to commit with technical support provisions. On paragraph 49a, we support lowering borrowing cost and request extension of DSSI with expansion of eligibility criteria. In 49b, we support institutional home proposals and request clear coordination mechanism and capacity building. support. On 50E, we strongly support UN intergovernmental process and request a specific timeline for implementation and clear terms of reference. On 51, we request recognition of development needs in assessment, technical support for capacity, enhanced coordination mechanism. Overall, the elements that we think that it is needed is a concrete cancellation provision, enhanced capacity building support, clear monitoring framework and specific implementation timelines. Yemen stands ready to provide specific textual proposals and thank you.

I thank the representative of Yemen and now give the floor to the representative of Colombia to be followed by the representative of the United States. Colombia, please.

Thank you, Madam co-facilitator. Colombia would propose the inclusion of a new paragraph, 47 bis, which we will send to the secretariat, highlighting that sustainability is vital for economic growth and the achievement of the SDGs. This paragraph will highlight the importance of transparency in debt and its effective management, recognizing that debt crises have grave economic and social ramifications, including cuts to public expenditure, which are disproportionately going to affect the most vulnerable populations. We also would highlight the importance of improving methodologies and ensuring that data can be better compared amongst countries to ensure that we're more effective and accurate in these measurements. Therefore, Colombia would turn to 48C and 48D, where we would suggest extending the scope of debt treatment mechanisms so that, as well as standstills, there are a variety of solutions. Colombia would also include additional provisions for paragraph 48, urging creditors to show flexibility with developing countries in instances of natural disasters so that affected nations can contend with their challenges related to debt while also attending to their specific socioeconomic needs. Robust debt framework systems are vital to avoid sovereign debt crises. While rules promote stability, they can also have structural costs limiting long-term development. First of all, many fiscal rules tend to incentivize public investment of the disincentivize public investments over the long term, particularly in areas important for sustainability. There is also a disproportionate risk that the debtors of public fiscal space will be closed down. There's a need to revise how we design these frameworks to favor long-term investment into sustainable investment, looking at capital costs and more equitably distributing risks amongst the creditors and debtors. we will send a proposed wording to the Secretariat. 49b, and the facility, this is about better helping countries to use debt swaps, and we think that such instruments should be highlighted in the text, as should the need, as should be the need to assist countries in debt swaps for climate and nature. 51a, we would highlight the need to take into account environmental and climate risks in measuring debt sustainability. This paragraph should reflect the importance of duly taking into account the outcome of the independent review of experts on debt. Thank you.

I thank the representative of Colombia and now give the floor to the representative of the United States to be followed by the representative of Ghana. United States, you have the floor.

Thank you.

First, it is critical that this

section continues to clearly express the responsibilities of borrowers to manage their debt prudently, including through transparent and prudent public procurement, refraining from borrowing beyond a reasonable ability to repay, and maintaining sufficient reserves to withstand fiscal shocks. The principle of transparency should be added to paragraph 47. In 48, we think the word guidelines is more appropriate than the word principles. Additionally, we do not have the ability to make a commitment towards enhanced legislative oversight in this document. The United States opposes the development of a new UNCCAC protocol. It's unclear what a new UNCCAC protocol would achieve, and we are against unnecessarily expanding the mandate of the UNCCAC to place new burdensome obligations on countries. Additionally, if a working group is to be formed to discuss principles of sovereign lending and borrowing, we believe it should be convened and populated by the IMF and expert debt practitioners, including those such as the Paris Club and G20 Finance Track members, not led by the UN. In 49, it's important to caveat that this in no way should interfere with the independence of central banks and the implementation of prudent monetary policy, including interest rate increases as appropriate. We cannot accept paragraph 50. The purpose of debt restructurings is to restore debt sustainability, not to finance policy priorities, including the SDGs. On 50b, a model law to augment fiscal/debt transparency could be useful, particularly if it addresses loan contracts which deliberately hide the terms and conditions of the debt. Regarding the language advocating for local legislatures to interfere in debt contract law, not only is this likely to be ineffective, but also counterproductive. Local legislation is likely to simply encourage debt to be contracted under the law of more favorable jurisdictions, and there is some evidence lenders are preparing to do this if such legislation materializes. On 50, the text should be redrafted to focus on promoting existing initiatives related to debt and appropriate fora and refrain from creating new or duplicative mechanisms. The United States cannot accept text that calls for a UN intergovernmental process on debt or proposes a role for the UN in the global debt architecture for which it is not mandated or equipped. On 51, we call for deletion of the language on private credit ratings. It is important that ratings be objective, independent, and based on sound analytical methods and accurate statistical measurements. Thank you.

I thank the representative of the United States and now give the floor to the representative of Ghana to be followed by the representative of Cuba. Ghana.

Thank you, co-chair. I align this intervention with that delivered by Egypt on behalf of the Africa group and wish to add the following in my national capacity. While we thank the COFAX for their efforts, we believe that the current text on this session on this section falls short in both ambition and action. Many of the proposals in the zero drafts fail to reflect the scale and urgency of the crisis confronting developing countries. We cannot afford half measures. We must act decisively. In this regard, we support the calls by the African group for the establishment of a multilateral sovereign debt workout mechanism. Such a mechanism is essential to aligning debt restructuring efforts with borrowing countries sustainable development goals. Furthermore, we reaffirm our proposal for an explicit commitment in the document to establish a global sovereign debt authority and to initiate an intergovernmental process to define its modalities. We envision this authority to oversee the workout mechanism while also driving much needed strategy and contractual reforms in sovereign debt management, there's the need for stronger language and commitment to scale up concessional financing and debt relief for developing countries in need. I echo the call by the Africa group mix and to reframe the narrative about responsible borrowing, taking into account external factors. Regarding paragraph 48A, we support the establishment of a working group to develop principles on responsible lending and borrowing. However, The pro- the proposal is that this group be formed in consultation with member states and be mandated to present its findings to the general assembly for consideration at its ATS session. We do note that some work has been done in this regard by and G20 and that could form a basis for, uh, the committee's work. We also support paragraph 48C on the creation of a single data registry, however, clarity is needed on where such a registry should be housed to ensure accessibility, transparency and effective governance. On 48E, we'll welcome the proposal for official lenders to increase lending in local currencies in developing countries to address currency risk and call for technical assistance to countries in such special situations. There is the need to flesh out this type of technical assistance that could be of support to countries in issuing local currency in debt and in local and global capital markets. Lastly, with respect to paragraph 48, we recommend strengthening the language. Rather than merely encouraging discussions, we should commit to establishing a dedicated platform for borrowing countries to engage on technical debt-related issues, ensuring their perspectives and needs are at the center of global debt policy discussions. I thank you.

I thank the representative of Ghana and now give the floor to the representative of Cuba to be followed by the representative of India. Cuba, you have the floor.

Thank you, Madam Ambassador. My delegation aligns with the comments already made by EOSIS. It is important to include language in paragraph 48a that explicitly requests the submission of the mentioned principles to the General Assembly for its consideration and appropriate action. We believe that this will be crucial to ensure that the principles are given proper level of attention and also are translated into real world impact. We already have a lot of promises that have not been fulfilled, including related to others, so we don't want that to happen again. In paragraph 50e, we support the proposal of IOSCE to separate the two ideas and propose to delete the first part that makes reference to the review of the sovereign debt architecture by the IMF envisioned in the pact of the future. We have concerns, I would say serious concerns, evidence-based concerns about the incapacity of the IMF to successfully review the debt architecture. The IMF is part of the problem, so we shouldn't give the IMF the possibility of trying to solve an issue that we know that in essence it's not going to appear. That is why we are asking for a reform on the IFI and IFA, particularly because of the IMF. The IMF has historically been part of the existing debt management framework, and there are limitations of course, to offer unbiased, comprehensive solutions to the deep-rooted issues with sovereign debt, especially in developing countries. Moreover, debt sustainability, as we all know, is a complex issue that requires broader, inclusive reforms beyond the scope of the IMF, which traditionally has prioritized austerity measures and conditionalities, which would go against the principle of leaving no one behind. We already always see when the IMF comes into action that the people and the most vulnerable segments of society are often the ones that suffer the most. So relying on the IMF would be, in our view, self-defeating when it comes to implementing the 2030 agenda. We fully support the proposal made by EOLSS to initiate an intergovernmental process at the United Nations level under the auspices of the General Assembly, again, the most democratic and inclusive body of this house, of this organization, during the 80th session to establish an international convention that includes a multilateral sovereign debt mechanism. The fact that those that have traditionally benefited from the broken system that we have are opposing the reform. just emphasizes how urgent it is. Thank you.

I thank the representative of Cuba and now give the floor to the representative of India to be followed by the representative of the Republic of Korea. India, you have the floor.

Thank you, co-facilitator.

In view of rising debt vulnerabilities, India advocates for global coordination to facilitate effective debt restructuring in a predictable,

timely, orderly and coordinated manner.

We present the following suggestions in the draft outcome document for your consideration.

India recognizes the importance of global consensus on debtor and creditor responsibilities and

emphasizes that the development of principles on responsible sovereign lending and borrowing, as mentioned in para 48a,

should avoid duplicating efforts already underway in existing forums. We also recommend that these principles remain voluntary and non-binding to ensure flexibility and encourage broad adoption.

We recommend housing the global central data registry mentioned in para 48C within the IMF, given its 191 member reach and its mandated role in Article IV discussions with all member countries. In para 48D, we urge caution in the use of debt cancellation and automatic debt service standstills, as they may shift focus away from SDGs, offering only short-term relief without encouraging long-term solutions.

Therefore, it is advisable to avoid including such clauses in official lending.

Additionally, we underscore the need to examine state and commercial debt contracts as the efficacy of state contingent clauses remains unproven and a one-size-fits-all solution may not be feasible. On paragraph 49, we recognize that debt swaps transactions are often complex, administratively costly, and reliant on donor subsidies. Their success depends on effective design and implementation. In this light, there is a need to further examine debt swaps in para 49A. Furthermore, we see greater clarity on debt sustainability support service. In paragraph 50, we propose that restructuring efforts be accompanied by adequate concession financing from MDBs to ensure sufficient fiscal space for necessary SDG investments. Regarding the strengthening of the G20 common framework, it is important to note that since its launch in November 2020, only four countries have applied for debt relief. Issues such as fear of credit rating downgrades, lengthy negotiations, and diverse creditors landscape have discouraged countries in distress from seeking relief under the framework. These aspects should be considered when expanding the mechanism to include other indebted countries that are currently ineligible. Many provisions mentioned in para 58 to improve debt restructuring architecture go beyond the scope of common framework and require careful consideration. For example, debt service suspension may have the possibility of creating a moral hazard by encouraging risky borrowing and undermining fiscal discipline. It could also negatively impact the debtor countries credit rating, making it more difficult for them to access international capital market.

I thank you.

I thank the representative of India and now give the floor to the representative of the Republic of Korea to be followed by the representative of Australia. Republic of Korea.

Thank you, Madam co-facilitator. With regard to paragraph 48d, The inclusion of standardized state contingent clause in loan and debt agreement should be applied with due consideration to the nature and specific characteristics of individual debt contract. Therefore, we propose toning down the expression call on creditors to ensure a more balanced approach. Para 48e. Local currency lending has the advantage of reducing exchange rate risk for borrowers, but it also creates new risk and cost burden for lenders. Taking this practical challenge into account, we need a balanced approach. Para 48F, we are not convinced of the effectiveness of a new UNCEC protocol in efficiently nullifying corrupt loan and borrowing agreements. Para 49A, the DSSS was originally designed for SIDS due to their specific debt challenges and climate related vulnerabilities. However, expanding DSSS to a wider group of developing countries would require careful consideration. as their debt situation and political and economic context vary significantly. A more tailored approach would be necessary, along with thorough discussions and broad consensus among countries. In this regard, it would be advisable to either remove this paragraph or limit the scope of expansion to countries in special situations such as LDCs, rather than applying it universally to all developing nations. Para 49b, support from IFI should be designed to strengthen debtors self-sufficiency and resilience. Debt swap can be a useful tool for debt management and developing financing, but they also involve reducing the nominal debt amount. Therefore, we recommend reconsidering the language on scaling up debt swap or such as debt swaps in this para to ensure a balanced approach. Thank you.

I thank the representative of the Republic of Korea and now give the floor to the representative of Australia to be followed by the representative of Honduras. Australia.

Thank you, Chair, and good morning, everyone. Australia is supportive of measures to enhance debt sustainability and provide liquidity to those with sustainable debt, particularly for countries in special situations. We need to work through existing institutions with expertise and comparative advantage to deliver effective outcomes and avoid costly duplication. In 48A, we question the value of a new UN-led working group, as this falls outside the UN's mandate and duplicates work already carried out by the World Bank and the IMF through the Global Sovereign Debt Roundtable and G20. So we do not support this measure. We strongly support 48B and see its actions as critical to any long-term solution to debt sustainability challenges. We also strongly support the use of state contingent debt clauses in 48D. But request standardisation to be encouraged but be voluntary, noting the benefits of flexibility. We see the line of argument presented in para 49 as oversimplified. We would like to see a more holistic discussion of the issue of debt sustainability and a direct reference to the IMF World Bank's three pillar approach in the chapeau. We'd like to see more ambition in the text in relation to the three pillar approach in paragraph 49A and note as per sub para 49B, we see the three pillar approach as the agenda to address the mentioned issues. We reiterate the need to leverage the comparative advantage of existing institutions and avoid costly duplication to support countries with debt management challenges. As part of this approach, we encourage the emphasis of support for countries in special situations, particularly SIDS. We strongly oppose the language proposed in paragraph 50 referring to all creditors participating in debt relief. We emphasize the MDB's important role in providing long-term, highly effective and responsible lending and their provision of concessional loans, which is enabled by their strong balance sheets and high credit ratings. MDB participation in debt relief would put this model at risk and would be to the detriment of developing countries. Regarding 50, we emphasise the need to tailor the common framework to low income and vulnerable middle income countries and question the need to expand it in light of successful debt restructuring outside of the common framework. We cannot support 50 without further information on this approach. We oppose 50E as the Pact for the Future is clear that the review will be undertaken by the IMF in collaboration with the UN. The initiation of a new intergovernmental process at the United Nations runs counter to this as the process is not yet complete. In para 51B, we see the Global Sovereign Debt Roundtable as a valuable forum for creditors, debtors and credit rating agencies to engage on these technical issues. We suggest we We suggest that we continue to let the process continue, so we find this paragraph more interesting at this time.

I thank the representative of Australia and now give the floor to the representative of Honduras, to be followed by the representative of Indonesia.

We align with the statement delivered by the Philippines on behalf of the middle-income countries, and we would like to express the following in our national capacity. First, we recognise that prudent management can be important for the silencing of sustainable development, but the current debt sustainability focus is not sufficient, particularly for developing countries. While it's true that lending countries are important, the lack of an appropriate, fairer and sustainable framework continues to be a major obstacle. Next, lenders, particularly from the private sector, continue to impose conditions which don't always take into account the economic realities of the more vulnerable countries. Debt crises being faced by many developing countries recognise structural failings in the international system, not just preventing sustainable investments, but also harming countries already exposed to climate and economic shocks. Third, the claim that countries have the responsibility to maintain sustainable levels of debt shouldn't be pretext to sidestep the responsibility from creditors. More vulnerable countries already facing major challenges should have adequate room for manoeuvre to address urgent challenges such as food insecurity and the effects of climate change. While the debt burden limits the possibility, debt limits the room for manoeuvre for investment because of this. It is too little, too late, and we think it is not enough to alleviate the burden faced by developing countries. We should allow countries to continue to invest in key areas such as green infrastructure, renewable energy and public health without compromising their long-term economic solvency. Fourth, it is urgent that we review this document in a way which is more inclusive, based on the real impact of shocks and the ability of countries to pay with agile solutions to face sustainable, to make sustainable development and climate action possible, because of this we need a development oriented approach. without unsustainable interest rates and supporting high debt countries so that they can once again embark on the path towards sustainability. I thank you.

I thank the representative of Honduras and now give the floor to the representative of Indonesia to be followed by the representative of Jamaica. Indonesia.

Thank you, Madam co-facilitator. On paragraph 47, we welcome the notion that debt, when managed properly, can significantly contribute to sustainable development by financing long-term investment in infrastructure, health, education, and climate resilience, among others. However, many developing countries face constrained fiscal spaces, not solely due to over borrowing, but also due to unforeseen crisis, economic shocks, climate disasters, and geopolitical instabilities. On paragraph 48C on the proposal to establish a single global central debt data registry, we take note that the proposal aims to enhance transparency by improving debt disclosure, which can contribute to better risk assessment and well-informed policy making. However, we seek further clarification to better understand the proposal on several aspects. First one is on institutional housing. What governance structure and oversight mechanisms are envisaged to ensure impartiality, credibility and inclusivity? The second one on potential impact to developing countries. Transparency should empower countries, not lead to disproportionate financial constraints. In this regard, how will the mechanisms safeguard against unintended consequences for developing countries? These elaborations will be instrumental in ensuring that the initiative is designed in a manner that is fair, balanced, and beneficial for all, particularly for developing countries. On paragraph 50, we support the call for a more inclusive, efficient, and development-oriented approach to debt restructuring, and to also highlight the importance of strengthening the common framework that accelerates debt relief for countries in distress, as well as to take into account the importance of debt-for-climate swaps, which allows countries to channel debt repayments into projects that support green energy transitions, disaster resilience, and poverty reduction. Further on the debt architecture, we support efforts to develop a more enhanced, flexible, and fair debt architecture that ensures developing countries can access timely concessional and counter-cyclical financing to maintain fiscal stability and social progress. as well as on sustainable development strategies that align with long-term development goals without compromising economic resilience. Thank you.

I thank the representative of Indonesia and now give the floor to the representative of Jamaica to be followed by the representative of Iceland. Jamaica, you have the floor.

Thank you, Madam co-facilitator. Jamaica aligns with the statements delivered by EOSIS and LMG Mix. In the context of the current high interest rate environment, it has become increasingly difficult for developing countries to access low cost financing. In recent years, financing offered by MDBs has been subject to variable interest rates, where borrowers pay a fixed spread in addition to a variable benchmark rate.

In the absence of low fixed rates on multilateral loans.

Developing countries would greatly benefit if MDBs add interest rate caps to loan contracts, which would prevent, which would prevent loan rates from rising beyond a certain level. The IDB offers a flexible financing facility which provides for interest rate caps as well as interest rate conversions in order to reduce the risk of escalating interest rates. which is associated with the variable rate borrowing.

This facility should be used by other MDBs and the IFIs.

IFIs typically use income classification to determine interest rates charged. However, this method does not account for vulnerabilities such as small size, remoteness, climate change impacts, biodiversity loss, and a narrow resource base, which are common among SIDS. We therefore reiterate the call for MDBs to use the MVI in considering access to finance. This would address the issue of SIDS being ineligible for concessional finance although their vulnerability hinders affordability. In addition to interest rate caps conversions, IFIs should address the cost of financing by dispersing loans in local currencies. This would address the contribution of exchange rate vulnerability.

The IDB's.

Flexible financing facility also includes this option to convert disburse, disburse loans to a local currency, this is an option which should be offered by more MDBs and we therefore support paragraph 48E. One final point, multilateral banks and IFIs have been charged to direct more of their resources towards climate finance. While energy transition would be included in such initiatives, areas such as food security and the digital transition might be neglected. MDBs and IFIs should therefore consider directing more resources in these areas. Thank you.

I thank the representative of Jamaica and now give the floor to the representative of Iceland to be followed by the representative of Japan. Island, please.

Thank you, Chair.

The section on debt and debt sustainability.

Is a key component of the outcome document, and we welcome the excellent draft on the topic.

Indeed, as is mentioned, all too often countries in need of debt workouts face too little, too late restructurings that carry with them detrimental impact on development.

The level of debt distress in developing countries.

Is exceptionally high, particularly in LDCs, with severe impacts on fiscal space that is critical to enabling reforms. We welcome the constructive language on debt and debt sustainability, including on scaling up capacity building to support national debt management offices in developing countries.

Indeed, sustainable borrowing and lending.

Practices are pivotal to long term economic development, as is sustainable debt management and debt transparency, and we suggest acknowledging the pivotal role played by IDA in this regard.

In relation to para 48a and d, we suggest to include a reference to the Global Sovereign Debt Roundtable.

It is important that we build on existing debt restructuring mechanisms and avoid duplication of efforts.

On para 50, we welcome the language on debt architecture for debt crisis resolution.

Indeed, efficient, fair, coordinated, and not least timely debt restructuring, building on the call made in the Addis Ababa Action Agenda, is required.

In para 50a, we welcome the strong text on reforming the debt architecture, including potentially extending the G20 common framework.

To mix in debt distress and recognize the need for reaching agreements with both public and private bilateral creditors based on comparability of treatment. We suggest that adding a reference to the World Bank and IMF's advisory work in this regard would be useful. Also, we suggest to add a mention of the multilateral debt relief initiative and the lessons learned from that. It is important to build on initiatives and measures that are already in place. Another important point that should be reflected in this para is that MDBs must be excluded from debt treatments to protect their preferred creditor status and treatment, which is crucial to avoid risk of increased borrowing costs and preserve concessional lending capacity.

Finally, in paragraph 51a, we have a small edit to suggest that we urge the IMF and World Bank, within their respective mandates, that's the addition, to continue to refine debt sustainability assessments.

Thank you.

I thank the representative of Iceland and now give the floor to the representative of Japan, to be followed by the representative of Kenya. Japan, you have the floor.

Thank you, Chair. On 47, we support timely debt treatment but oppose too little too late as debt treatment ensure borrower debt sustainability. On 48, we support further efforts but should avoid duplication with existing principles and tools. We oppose standardized state contagion clauses by all creditors mentioned in D as benefits are limited for debtors and creditors. and SCDIs complicate the process for ensuring comparability of treatment among creditors. On 48a, G20 and Paris Club address debt issue under the IMF and World Bank supported common framework with established principles and guidelines. UN working group would duplicate existing forums. On 48c, we should point out this data set, the data registry should be housed in the World Bank. On 49A, liquidity challenges discussion should be aligned with the three pillar approach by the IMF and the World Bank, which have particular expertise on this area. On CDS, DSS, we need clarification of financing sources for debt relief before taking position. And we cannot support 49B as no existing facility fits the proposed role. On 50, we oppose too late and remain too slow and shallow. Shallow is incorrect as debt restructuring ensure debt sustainability. The part of the ad hoc nature of debt resolution processes is also misleading and incorrect. Debt restructuring requires case-by-case approach while we already have well-established framework of debt restructuring under the G20 common framework. On 50A, We fully support improving G20 common framework implementation as a solution for debt crisis based on the IMF and World Bank DSA as an anchor. Debt service suspension is time consuming and may lead to default as seen in Ethiopia under common framework. Alternative legally binding options such as creditor endorsed moratorium should be explored. We welcome a user manual for debtors with clear timelines and other guidelines. which would help to expedite the process of determining debt treatment. On 50b, we oppose the working group on a model law on debt restructuring, as legal systems are not the main impediment, and introducing the same law in various countries is unrealistic. On 50e, we oppose UN-led debt crisis process, as it is ineffective, Instead, efforts should focus on improving the G20 common framework. For the UN process, it will be sufficient to use agreed language in the pact for the future. Finally, on 51, while transparency and accuracy of credit rating are important, this paragraph judges assessment challenges related to credit assessments. More precise and targeted analysis in relevant organizations are needed before addressing these issues. We should avoid any commitments on enforcing consistent regulatory regimes for credit ratings before such reliable analysis. I thank you.

I thank the representative of Japan and now give the floor to the representative of Kenya to be followed by the representative of Zimbabwe. Kenya, please.

Thank you, co-facilitator. Kenya aligns its comments with the statements made by Egypt on behalf of the Africa Group. And in our national capacity, we wish to make the following comments. On para 48c, on the issue of single data registry, We note that in terms of most, some countries, Kenya specifically, we already have a data registry which is robust, capturing information on debt recording and settlement. So in this case, global data registry may not be relevant to all countries. In this regard, we call that support should be given to countries that already do not have, um, uh, a data, uh, a death, uh, recording, uh, system so that they should have a robust death recording system in place. Also, um, just a second. Also in terms of, Also in terms of the issue where it is mentioned that, just a minute, my comp is misbehaving. There was where it is mentioned that we will have a facility. So in that regard then we note that this facility should be a facility that is the practicability should be indicated on how it will work. Sorry for that. Also on para 49B, this needs to be broken down as a one size fits all is not feasible in that case. On para 50A, We note that debt restructuring is always construed by credit rating agencies as a default, which leads to credit rating downgrades. This makes the debtor country access to more expensive credit due to high premiums. Therefore, commitment that the debt restructuring will not be led to credit rating downgrades, but as a liability management operation. Also in para 51A, In the last sentence, it says we. It is not clear whether it will be the IMF or the World Bank to do this, so it needs to be clarified. I thank you.

I thank the representative of Kenya and hand over the floor to my colleague, Ambassador Chola, to chair the meeting.

Good afternoon. I now give the floor to the representative of Zimbabwe, who will be followed by the representative of Canada. Zimbabwe, you have the floor.

Thank you, co-facilitator, for giving me the floor. Zimbabwe aligns itself with the statement delivered by the Africa Group. And in our national capacity, we'd like to add the following comments. High borrowing costs and subjective credit rating systems have limited the access by developing countries to new lines of credit. This has placed countries in a position of perpetual debt distress and has constrained fiscal space. to channel resources towards much needed development programs. Our proposed solutions include the following. Firstly, regional financial institutions, which include the African Development Bank, have a critical role to play in providing affordable long term concessional funding. In this regard, they require adequate capacity for them to support countries in need. To this end, we believe the rechanneling of special drawing rights to regional development banks is a viable solution to the inadequate capacity of banks to meet the borrowing needs of developing countries. Additionally, leveraging SDRs either as collateral for concessional financing or debt relief efforts would be an efficient way to provide fiscal space for our countries, thus enabling us to manage our debt effectively while maintaining access to international markets. Secondly, we believe the debt for investment swaps can be an effective, innovative tool of addressing debt challenges. offering benefits for both debtors and creditors. We are encouraged by the examples from those countries that have explored this model and managed to simultaneously sustainably service their debts while attracting private investment for sustainable development. Thirdly, we welcome the recognition in paragraph 50 of the challenges associated with debt resolution processes, which are often initiated too late and do not address underlying challenges. Zimbabwe maintains that restructuring processes should also account for the development needs of the indebted countries and we lend our voice to calls for a more development-oriented international debt architecture. Further, we call for the inclusion of a specific reference to the preservation of access to financing resources under favorable conditions during debt restructuring processes. Without this element, which was included in the Addis Ababa Action Agenda, this important issue would be left unaddressed. We also welcome paragraph 50d, which highlights the important work done by the Africa Legal Support Facility in providing legal and financial advice to African countries during negotiations and structuring of debt transactions. In the same vein, stronger efforts must be made to build capacity in African countries to effectively negotiate the most favorable debt mechanisms. Paragraph 51 on credit ratings can benefit from stronger language. Developing countries are often at the receiving end of the current credit ratings, whose processes are undermined by subjectivity and transparency concerns. We support the proposal to strengthen the capacity of countries to carry out their own debt sustainability assessments and to commend the addition of language which supports the promotion of regional credit rating agencies. I thank you.

Thank the representative of Zimbabwe. I recognize the representative from Canada who will be followed by the representative from Switzerland. So Canada, you have the floor.

Thank you, Chair.

Canada is wary of, pardon me, Canada is wary of the text in 48C as the creation of a new debt data registry would seem to duplicate work already undertaken by the IMF and the World Bank. We will submit suggestions for alternate text. We suggest explicitly referencing CRDCs in 48D as it represents an important tool for countries facing climate challenges. Canada reaffirms its call on all creditors to explore embedding CRDCs into all new sovereign lending. On the outset, Canada is not supportive of the text in 48F with regards to fully utilizing UNCAC and exploring a UNCAC protocol that makes such contracts unenforceable. It is not clear to us how this could be integrated into the UNCAC framework, but would welcome additional information to clarify the intentions of this commitment. With regards to the text in 50 and 50E, at this stage, Canada does not support going beyond the proposed review of the sovereign debt architecture outlined in the Pact for the Future, and our focus remains on strengthening and improving existing mechanisms, particularly the G20 common framework. We fully echo Japan's comments in this regard. Thank you.

I thank the representative of Canada. I now recognize the representative from Switzerland who will be followed by a representative from the Russian Federation. Switzerland.

Switzerland has the following comments on paragraph 47, we suggest at the end of this paragraph a more encompassing wording, quote, there is a need for a stability, growth and development oriented debt architecture to allow countries to sustainably borrow and invest in sustainable development and for supporting heavily indebted developing countries in returning to a path of debt sustainability, unquote. On paragraph 48F, Switzerland is convinced that the UNCAC as a quasi-global convention is sufficient as a basis that does not require any additional protocols or bodies. Therefore, we suggest to delete the second part of the sentence. On the section fiscal space for investment in countries facing debt challenges, paragraph 49 preamble. It is crucial to address high debt vulnerabilities, including high debt service burdens and their root cause in a holistic manner, we sent the co-facilitator slightly amended wording proposal to this effect. Paragraph 49b, for Switzerland, is it paramount that the respective mandates and governance arrangements for international financial institutions, international organizations, and global fora are fully respected. Therefore, we suggest to use instead of we call the wording, we encourage exploring, et cetera. Paragraph 50e, similarly, work on the sovereign debt architecture should continue to be led and conducted by the IMF as well as the World Bank and the G20. Therefore, we suggest to replace the wording, we will initiate an intergovernmental process at the UN with we encourage continuing work in the IMF, the World Bank and the G20. Finally, on paragraph 51a, the application and the review of the debt sustainability framework for low income countries are in the purview of the IMF and the World Bank. Discussions on this should be held in and decision on this should be taken by the IMF and the World Bank governing bodies. The paragraph can be shortened accordingly. Thank you.

I thank the representative of Switzerland and now give the floor to the representative from Russian Federation, who will be followed by the representative from Lebanon, Russia, you have the floor.

Thank you, the facilitator. We believe that resolving the issue of debt in developing countries should be comprehensive, inclusive, and sustainable. As you know, some of the provisions in this section have to do with the sovereign rights of creditors and debtors and go against the principle of responsibility of countries for their own development. and on a practical level they could hinder access of developing countries to capital markets. In 48A and C, we note that currently there are a number of initiatives underway in specialized bodies and platforms that are looking at the issue of debt. initiatives to create new alternatives or new elements needs to be examined in detail with regard to their added value, if any.

We would like to specify position later on this issue.

S-448D, on the issue of including state contingent

clauses, we believe that this issue ought to be examined on a case-by-case basis.

first and foremost between the debtors and the creditors. Where 50A are open to discussing expanding the common framework to highly indebted countries that are middle income countries. And we propose adding clarity to the language on standardization when it comes to debt service suspension. The proposal in 50b might run counter to national laws in states, so that must be taken into account. Paragraph 50e, we welcome a review of the sovereign debt architecture and updated information from the UNSG on progress and proposals to identify gaps and insufficiencies. in the global debt architecture. However, the reference to the pact for the future is not acceptable to us. Paragraph 51B, we propose including proposal on the need to hold a regular dialogue between member states, credit rating agencies, governing bodies, regulatory bodies and standard setting agencies, as well as other interested bodies. And to suspend the regulatory systems that would make the credit ratings more transparent and more objective and more focused on the long term.

Thank you.

I thank the representative of the Russian Federation. I now give the floor to the representative of Lebanon, who will be followed by the representative of the Holy See. Lebanon.

Thank you. Thank you, Ambassador. In this section focusing on enhancing debt management and sustainability, we strongly align with the statement and remarks delivered by Philippines on behalf of the like-minded group of countries for middle-income countries. Indeed, debt management is essential. However, it's important to balance the language by acknowledging that debt sustainability relies on combination of factors extending beyond effective debt management at both international and national levels. We also emphasize the importance of country-specific circumstances and the effects of external shocks. We would like to see this language strengthened that developing countries, including middle-income countries, face a lack of essential support and access to post-concessional and non-concessional financing, making it difficult for them to manage their increasing debt burdens, as well as to tackle climate vulnerabilities and social inequalities, as well as to invest in critical sectors like health, education, and infrastructure. Therefore, in this LOM we welcome in paragraph 47 and support the mention that high debt service burdens severely constrain fiscal space for investment and sustainable development and climate action. The conference is an event to advocate for international support to establish a multilateral sovereign debt mechanism for fair and timely debt resolution. So it's vital to reflect this in the text. And in paragraph A48, we support the idea of encouraging the creation of and supporting existing platforms for borrower countries to discuss technical issues, coordinate approaches, and share information and experiences in addressing debt challenges. And we would like to see a timeframe and the way forward on this matter. The title of the first section in this debt section is sustainable and responsible borrowing, lending, and debt crisis prevention. And the title of the third section is debt architecture for debt crisis resolution. However, under this section, we would like to propose to include in paragraph 50, after heavily indebted countries, a reference to countries facing crisis. I thank you.

I thank the representative of Lebanon, and I'll give the floor to the representative of the Holy See, who will be followed by the representative of Cabo Verde and then UK. Holy See.

Thank you, Mr. Co-Facilitator. The Holy See's contributions to this document are guided by the aim to transform our international financial architecture as a means to turbocharging our commitments to eradicate poverty and achieve sustainable development. Unsustainable debt must be recognized not only as a major obstacle to such efforts, but a systemic risk that undermines global economic stability. It is the Holy See's view that a critical element of effective action on addressing debt challenges is debt cancellation. The Holy See is therefore proposing explicit language on the role of debt cancellation as a means to addressing current debt challenges, as well as its contribution to our wider efforts to achieving sustainable development. The cancellation of unsustainable debt by all creditors, where appropriate, is essential for developing countries to be able to make critical investments, for example in the areas of health, education, social protection and climate adaptation and mitigation. the creation of this fiscal space for countries including ldc's and sids would offer the kind of transformational opportunity that is needed if we are to realise our goal of achieving sustainable development for all. turning to other elements of the chapter in paragraph forty seven we would ask for the deletion of the caveat when prudently managed. we are concerned that this suggests the current debt crisis is the sole responsibility of indebted countries and does not take into account external factors nor the responsibility of lenders. we also propose the addition of language on the specific challenges faced by ldc's and sids. we welcome language that recognises the high cost of borrowing for developing countries and support the language in paragraph forty nine on significantly lowering borrowing costs. However, we believe that this could be strengthened with a measurable commitment that speaks to the urgency of this issue. In paragraph 49A, we are pleased to see language on the operationalization of the DSSS, especially with its regards to expanding to cover other developing countries, including LDCs. We welcome too the proposal on the initiation of an intergovernmental process at the UN with a view to closing gaps in the debt architecture. However, we believe that this language needs to be strengthened strengthened and make a more concrete commitment on the establishment of a sovereign debt mechanism. In order to break free of the debt financing cycle, it is necessary to create a mechanism that should be based on the principle of solidarity and that takes into account the global nature of the problem and its economic, financial and social implications. Thank you.

I thank the representative from the Holy See. I now recognise the representative from Cabo Verde and then the UK. Cabo Verde, you have the floor. Thank you, Mr. Kocher.

Cape Verde aligns itself with the previous statement made by the African group in EOSIS. In our national capacity, we'd like to make the following comments. Debt burdens limit the ability of nations like ours to invest in future growth. As a SIDS and developing country, Cabo Verde advocates for expanded debt relief mechanisms, including debt for nature swap and debt, debt for climate swap, as well as debt relief linked to strategic infrastructure and sustainable development projects, as mentioned here. These initiatives allow us to convert financial obligations into meaningful projects that promote environment sustainability and sustainable economic development. We advocate for sustainable debt management, debt relief to promote economic sustainability and resilience, local community empowerment, local private sector, development and achievement of sustainable development goals. It's also important to highlight that debt relief and debt swap create opportunity for local private sector development. We also advocate for vulnerabilities such as those identified through the multidimensional vulnerability index to be considered in determining countries' eligibility for debt relief. Furthermore, we'd like to emphasize that countries with good debt management should not be penalized for their efforts, but rather encouraged through more debt relief to promote their sustainable development. Therefore, we'd like these considerations to be included in the paragraph 48. I thank you.

I thank the representative of Cabo Verde. I now give the floor to the representative of the United Kingdom, who will be followed by the representative of Haiti. UK.

I thank you. The UK would like this chapter to make a strong statement of ambition to strengthen the existing architecture and frameworks. We welcome language in the text focused on sustainable lending and transparency. In paragraph 47, new lending should not only not undermine, but in fact should support a country's debt sustainability. On paragraph 48, we want the text to push for greater transparency over both external and domestic debt and stronger and improved debt governance mechanisms. It will be important to ensure that new measures, for instance, new transparency initiatives, build on existing structures and do not create strain on limited debtor country capacity. On paragraph 48a, We would like to better understand proposals for developing sustainable lending principles at the UN, as we see greater value in calling for adherence to existing agreed principles, including G20 and OECD principles. On 48D, we strongly support the use of measures to ensure new lending is sustainable. In this vein, we would like to see higher ambition on state contingent debt clauses or natural disaster clauses. We should call on all creditors to include such clauses in loan and debt contracts. facilitate debt service standstills during times of crises. We also, in this vein, strongly support language in the text to encourage majority voting provision uptake, which is mentioned at paragraph 50c. On paragraph 49, we would welcome increased clarity here on the IMF World Bank three pillar approach. On paragraph 50, we agree that improvements to the common framework are needed, particularly in terms of speed, and the text should reflect this. On 50b, While we recognize the importance of comparability of treatment and are supportive of efforts to improve understanding in this space, we are not pursuing legislative options. We would welcome greater clarity on the value of potential development of a model law, given that this is a matter for individual countries to determine. On 50E, we would like to see the recommendations of previously commissioned reviews of the international debt architecture before any new review is commissioned. As previously stated, We would like to see improvements to the current architecture rather than the creation of new mechanisms. Strengthening and increasing debtor voice remains a priority for the UK. We welcome the focus on ensuring the current architecture can deal with all of the challenges countries are facing, including solvency, liquidity, and ensuring future debt is more sustainable and frees up domestic resources for investment in the SDGs. We will follow up with specific written proposals. Thank you.

I thank the representative of the United Kingdom. I now recognize the representative from Haiti, who will be followed by the representative from Pakistan and then Brazil. Haiti.

Thank you, co-facilitator. I'd like, first and foremost, to welcome the dynamic leadership and effective action we've seen from the co-facilitators, Mexico, Nepal, Norway, and Zambia. all of whom on twenty two january twenty twenty five presented this zero draft version of the outcome document for ffd four which we're examining today the delegation of haiti aligns with the statement delivered by the l d c s and would like to add the following in our national capacity on to on the viability of debt and solutions to systemic challenges. 50A debt architecture and solutions to debt crises. We'd recall that small island states, SIDS and the LDCs have challenges when accessing financing. This remains the major challenge that we need to address to accelerate the implementation of the Sustainable Development Goals, the SDGs. Because of that, my delegation would propose adding to 50a establishing a viable and consensual mechanism to guarantee the voices of SIDS and LDCs in decision making processes and standard setting, as well as making it easier to access financing from international financial institutions. Next, systemic challenges, global economic governance. 53a first, we believe that we need to clarify this paragraph by adding as follows, we pledge to establishing a mechanism, including support services for the SSS, to assist small island developing states and least developed countries to ensure that they have viable ways of restructuring debt and freeing up, as soon as possible, climate funding and ensuring that there is long-term resilience for sustainable development. the SSS for LDCs and SIDS would include debt swap mechanisms, concessional financing and regional coordination mechanisms. Thank you.

I thank the representative of Haiti and now I'll give the floor to the representative of Pakistan who will be followed by the representative of Brazil. Pakistan, you have the floor.

Thank you. In 2022, developing countries faced a net resource outflow with them paying 49 billion more to their external creditors than they received in fresh disbursements. If FFD4 can agree to ambitious and meaningful solutions and not superficial ones to the debt crisis facing developing countries, we believe that the conference would count as a success. We completely agree with Philippines on behalf of LMG Mix, African Group, Bangladesh on behalf of LDCs, and how the beginning of this section is imbalanced. There is clearly a selective rewriting of how the Addis Ababa Action Agenda framed the distribution of responsibility between borrowers and lenders. We ask you to revisit the beginning of this paragraph. The key issues we need retained and strengthened in the Rev 1 are as follows. The proposal on principles for sovereign borrowing and lending, a global central debt data registry, the creation of a borrower platform, a model law on debt restructuring, reforming the G20 common framework, an institutional facility to provide debt servicing support and revisiting the debt sustainability analysis allow us to highlight how these can be strengthened. On 48A on the working group for principles of borrowing and lending, like many other developing countries are proposed, this working group needs to be set up in consultation with member states and its outcomes need to be submitted to the General Assembly for consideration. We propose the working group submit its work by the 80th session. We support 48C on creating a single global central debt data registry, but we need to be clear on where it would be placed. If we cannot agree where it should be placed right now, we suggest an intergovernmental process to decide where such a registry needs to be placed. We support 48D, E, and F. On 48G, if we can only encourage the creation of platforms, it is a meaningless commitment. Let us commit outright to establishing a platform for borrower countries. There is no one universal platform yet like this. On 49A and B, on the DSS, We have expressed our consistent reservations on this document, taking credit for outcomes which have already been agreed to in other documents. If the DSSS cannot be expanded to all developing countries, then let us not pretend this is a new initiative and we suggest taking verbatim agreed language on it. We would also request separating 49B from 49A and we asked for the deletion in 49B of the reference to within an existing facility of an international financial institution. On 51A, it needs to be strengthened, but we will submit that in writing, and 50B needs to be more direct, a direct commitment to develop a model law and debt restructuring. However, let us come to the most important point in this entire section. We believe all the different proposals you have made, co-fax culminate in 50E, an intergovernmental process at the UN where we will all be equal to take forward these different parts of a new sovereign debt architecture. We propose that 50E be made more direct with an outright commitment to an intergovernmental process for a debt restructuring mechanism and a sovereign debt authority. The UN does have the mandate to initiate such a process. If it cannot, I do not know why we have a debt section in the FFD outcome document. We are extremely disappointed by proposals to bring 50E back to pack language when delegations know how controversial it was. We request the deletion of the reference to the IMF debt review. We do not want to inadvertently approach a repackaging of existing work rather than an actual fresh review. Developing countries cannot be told on the one hand that we cannot discuss new initiatives under the UN and on the other be told that we cannot be prescriptive on how to improve existing frameworks. I thank you.

I thank the representative of Pakistan. I now give the floor to the representative of Brazil, who will be followed by the representative of the People's Republic of China. Brazil.

Thank you, Chair. Just before I begin, I'd like to recommend the report and suggestions to our FFD process by the Commission of Experts led by Professor Ocampo, which was launched yesterday during a lunchtime side event. was drafted by the world's leading economists and contain many technically sound and ambitious proposals to help us move forward in our work. Today, the debt crisis is perhaps the single greatest challenge for developing countries to achieve SDGs. According to data from UNCTAD, service on external debt, public debt reached 847 billion in 2023, compared to the 223 billion in ODA that same year. This is only debt service, not to mention negative flows from royalty payments, illicit financial flows, and payments from investor-state dispute settlements. In this context, it's curious to hear the emphasis that's put on responsible borrowing by developing countries, especially in light of the spillover effects of monetary policy decisions on the cost of debt in the developing world. In 2023, 54 developing countries allocated 10% or more of government revenues to interest payments. 3.3 billion people live in countries that spend more on debt service than on health or education. We find ourselves in the absurd situation where the net capital flows are going from the poor countries, from the global south, to developed countries in the north. This is unacceptable and needs urgent redressing. With regards to the text on para 47, we would like to suggest the following edits. Lenders have responsibility to lend with fair interest rates and conditions in a way that does not undermine a country's debt sustainability. Towards the end of that paragraph, we would suggest UN framework convention on sovereign debt should be negotiated and agreed upon by member states through an equitable, inclusive, and transparent process Or we could strengthen the language in para 15e where such a mechanism is mentioned. With regards to para 48a, we can support this language with the proposal of the US Secretary General to create a working group. With regards to para 49, now this is language that could also go in 38h where we're discussing multilateral development banks, MDBs, and the IFIs to create a proposal to create a yearly SDR emissions to help developing countries to finance a stable development. So, it's a proposal for not to have a one-off SDR emissions and then work so much on channel rechanneling, but to have yearly SDR emissions. With regards to para 49a, we support the three-pillar approach proposed by the IMF. and the World Bank with regards to para 50A, there's a need to strengthen the comparability of treatment so that the private sector contributes its fair share in the debt resolution treatments so that it's not only the public sector that have to be put in the bill so that the private sector also has its fair contribution. Those are the comments that I would like to make at this time. Again, I refer you to the excellent report by the commission of experts. That document exists to help our deliberations here. Thank you very much.

I thank the representative of Brazil for his submission and for his recommendation. Thank you very much. I now recognize the People's Republic of China, and then we'll have civil society representative from Red Latino Americana. China, you have the floor.

Thank you, co-facilitator. On the section on debt, China wishes to share the following comments.

First.

After 48, we suggest adding a new para on promoting enhanced oversight of international commercial bonds by the international community, calling for the establishment of sound regulatory rules and mechanisms for the issuance, use, management, and circulation of international sovereign commercial bonds and regulating relevant financing behaviors. Second, In 48, enhanced debt transparency should fully take into account different national conditions and differences in practice across countries and follow international rules on information disclosure and established practices in exemptions for commercially sensitive information. Third, in 48, state contingent clauses still need to be further studied and should be based on friendly consultations. and engaged with voluntarily. We suggest deleting the language on including standardized state contingent clauses in loan and debt contracts. In 49A and B, measures such as policy options to address liquidity challenges, encouraging official creditors to use financing tools such as credit enhancement and the scaling up of debt swaps should be in line with specific national conditions. and adopted voluntarily. Consensus language from G20 discussions can be adopted in this para. In 50A on the language on the common framework, consensus language from the G20 is advised here and the text should be amended to read, we encourage the G20 to step up the common frameworks implementation in a predictable, timely, orderly and coordinated manner. We also suggest the inclusion of expressions on promoting information sharing and early engagement between IMF, World Bank and the official bilateral creditor and improving MDB's participation in debt treatment in this para. In 50B, Debt treatment should be carried out on a case-by-case basis and respect each country's domestic laws. We suggest deleting the language on the setting up of a working group to develop a model law on debt restructuring for member states to consider adopting as part of their domestic legislation. Seventh, the principle of fair burden and common action should be upheld in debt treatment. we suggest adding some text on promoting the participation of multilateral creditors and commercial creditors in debt treatment in an equally comparable manner. Finally, in 51A, we suggest replacing better capture climate and nature risks with better reflect the assets perspective and adding some text on enhancing communication with main creditors. and introducing factors influencing interest rate policies for major currencies. Thank you, co-facilitator.

I thank the representative of China. I now give the floor to the representative of Red Latin America, who will be followed by the representative from Asian People's Movement on Debt and Development. Red Latin America, you have the floor.

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Thank you, Chair. Daniela Verdeja on behalf of Latin Debt and Civil Society, FFD Mechanism. The current debt crisis, widely recognized, is not limited to high debt levels, but the servicing burden is crowding out an increasing proportion of public social investment. The zero draft must clearly acknowledge that the obligation to prioritize debt repayment threatens the ability of the state to fulfill its people's and ecosystems fundamental rights. These problems are also relevant for middle-income countries covered in paragraph 47 where it's mentioned debt relief for highly indebted developing countries. So policy design must be more ambitious in line with this challenge, including assessments with new comprehensive criteria for countries to access concessional finance and grants as mentioned by some member states. The different stages of the debt cycle are highly interdependent, so the benefits of partial reforms may be outweighed by the limitations of a fragmented approach, such as the one currently offered. The current challenges require more ambition based on a systemic and comprehensive approach that provides a framework of clear institutions and rules at the international level. Along these lines, the elements of the debt chapter should be framed within the decision to initiate an intergovernmental process under the auspices of the UN aimed at establishing a legally binding framework on debt. At the core of such framework, there should be a debt workout mechanism as suggested by some member states. Moreover, within such framework, the recommendations to paragraph 47 to 48 include, first, It's mentioned that a development-oriented debt architecture is needed, but it must also be human rights-centered, decolonial, and gender-responsive. To achieve this, a transformational reform is urgently needed, such as the one stated above. Second, include clear language on co-responsibility and the need for the principles of responsible lending and borrowing to be adopted on a binding basis, building on the principles that already exist. There is no need for more expert working groups on debt. On responsibility of borrowing, the zero draft should acknowledge the structural economic imbalances and the exposure to vulnerabilities and shocks as the impacts of climate crisis, speculative financial markets, and high cost of capital. Third, on transparency and accountability at all stages of borrowing, including its use, emphasize it should be enforceable on the part of borrowers and lenders, including bondholders. It is suggested that this initiative include not only parliamentary oversight, but also supreme audit institutions, as well as the participation of civil society and communities in surveillance. We agree on the urgency of the creation of a global debt registry, as there isn't currently any institution that takes this role as part of the UN Debt Convention framework on debt. Finally, recognizing that The creditor led forums have failed to deliver concrete results and have favored particular interests, an independent and democratic space is critical for a fair, effective and inclusive debt architecture. It is not a duplication when the current ad hoc processes have proven they don't fit for purpose. It is therefore necessary to affirm the role of the UN, which neither lender nor borrower can provide the multilateral space that meets this need and offers immediate action in response to the crisis, but also solutions with lasting and long-term impacts, prioritizing the sustainability of life. Thank you for the opportunity.

Thank you. I now give the floor to the representative of Asian People's Movement on Debt and Development. will be followed by the representative of Africa Forum and Network on Debt and Development, Asia Peoples Movement.

Thank you, Chair. I am May Benaventura of APMDD also speaking on behalf of the Civil Society Financing for Development Mechanism. FFD4 is a critical moment to deliver actionable outcomes on longstanding gender inequalities and systemic issues including colonial patriarchal legacies embedded in and reproduced by the current international financial architecture that prioritized debt servicing at the expense of the fulfillment of human rights and the achievement of SDGs. We cannot retrogress on the CEDAW, a core human rights treaty with almost universal acceptance by member states that mandates providing adequate resources towards protecting and realizing women's rights. To that end, we strongly reiterate the call to agree on an intergovernmental process for participatory and equitable debt governance and crisis prevention reforms, leading possibly to the adoption of a UN framework convention on sovereign debt. Such an agreement can pave the way for binding commitments to ensure that lending and borrowing practices promote gender equality and overall work for and not against women in all their diversity. It is concerning that the zero draft hardly mentions the continued and widely documented violation of human rights of women and girls, caused in no small part by burdensome debt servicing, even for unsustainable, illegitimate and odious debts, which gravely restrict the ability of states to fulfill the core responsibility of promoting their people's well-being and fundamental human rights, as pointed out earlier by the distinguished representative from Lebanon. Specifically, the debt chapter makes no mention at all of the huge obstacle that debt burdens pose to achieving a better life for women and girls. Para 47 should explicitly state that high debt service burdens constrain fiscal space for the realization of gender equality and women's rights, or otherwise risked by its silence and implicit gender bias, disadvantageous to women and girls. On para 49, we note with concern the key roles given to international financial institutions who are themselves implicated in setting austerity loan conditionalities that harm women and exploit their unpaid care labors. As the representative from Cuba said, IMF is part of the problem, and we cannot agree more. On para 50, a truly development-oriented international debt architecture cannot only give premium to the participation of creditors. The voices of borrowing countries must be assured as well, including the informed participation of women, who the UN has long recognized as largely absent in all levels of policy decision-making. A growing number of countries today face debt restructuring negotiations with lenders, and an even bigger number of countries implement austerity measures that devastatingly impact women and girls, the reforming the global debt architecture cannot wait any longer. We are heartened by earlier expressions of member states on the need for a multilateral legal debt framework and mechanism which suggests recognition of the need to shift away from creditor-dominated decision-making arenas on sovereign debt. We need this UN framework convention on sovereign debt and urge member states to heed this urgent call, turning aspiration to ambition and raising ambition into concrete action. Thank you very much.

Thank you very much. And I'll give the floor to the representative of African Forum and Network, a network on debt and development, who will be followed by PEAC Institute.

Thank you very much, facilitator. I am Jason Ruganza representing the African Forum and Network on Debt and Development and the Civil Society Financing for Development Mechanism. Facilitator, the road to SIVIA is not just about agreeing an outcome document on debt. It is about safeguarding the future lives that are at present being mortgaged due to the diversion of critical financial resources to prop up a creditor centric debt architecture. This debt architecture is sure to guarantee that the SDGs and agenda 2030 will not be achieved given that countries that have defaulted and countries that are in high risk of debt distress are not only going to default on their debt but default on their development agenda. It is against this backdrop I will touch on some specific proposals in the zero draft, and given the time constraint, details already submitted as part of our broader submission. Safe to say that we are welcomed by the analysis in the, by Philippines and Palau and other member states in how they have identified the bias in the analysis of the debt section and preamble. But more specifically, as we welcome the call in the zero draft for a debt architecture to be more development oriented, We however recommend that the language is more robust and takes this outcome to a more ambitious level than in Addis Ababa back in 2015. This can be done by adding phrases such as a human rights and decolonial debt development architecture, in which all creditors effectively participate and ensure that a fair, predictable, coordinated, timely and orderly restructurings are carried out. Specifically in paragraph 50, we are proposing replacing path of debt sustainability with path of sustainable development and climate action. On 50A, we are proposing a rewording of this section, for example, to state, building on lessons learned from debt relief and debt resolution processes, we decide to establish an intergovernmental process in the United Nations to review existing debt architecture with the aim to establish a UN framework convention on sovereign debt that addresses the establishment of a fair and transparent multilateral sovereign debt workout Debt resolution mechanism on 50B explicitly adding both lender and in borrowing countries that mandates transparent and fair governance and debt and management of sovereign debts, this is consistent with the broader objectives of FFD4 to be ambitious and build on from Monterey, Doha and Addis Ababa, on 50C, we propose adding. Debt relief instruments and measures in any form must fulfill principles of transparency and accountability, both in their negotiation and their implementation process, guaranteeing meaningful participation and the rights of local communities over the interests of private intermediaries. We welcome the calls by the Africa Group, Palau, and other member states on paragraph 50, section 50e, on the establishment on a intergovernmental process that will lead to agreeing a legally binding framework on debt with binding principles as those in from uh untad on responsible borrowing and lending facilitator the fourth financing for International Development Conference must agree a historic un intergovernmental binding process that will develop and adopt a legally binding framework convention on sovereign debt in conclusion chair As the civil society mechanism, we wish to register also in the strongest possible way our grave concern over the modalities adopted by this process for closed-door negotiations. This is a direct contradiction to the spirit and rhetoric spoken about FFD4 and a moment to save multilateralism and put people first. We strongly encourage this House to reverse these modalities and get people back in the room, or the legacy of Seville will be that of closing civic space. Thank you.

I thank the representative of Afrodad. I now give the floor to the representative of PEAC Institute, who will be followed by the representative from Liberia. PEAC.

Thank you, Chair. My name is Janet Palafox, and I'm speaking on behalf of the PIC Institute and the NGO Committee on the Financing for Development, a substantive committee of the Conference of NGOs. The zero draft recognizes the growing debt crisis, but it does not go far enough in addressing how climate change is making debt unsustainable for many countries. Nations facing repeated climate disasters are forced to borrow to rebuild, creating a cycle where they must pay for crises they did not cause. Debt and climate justice cannot be separated. We propose the following recommendations. Paragraph 47 highlights borrowing as a tool for sustainable development, but does not acknowledge how climate change makes it harder for countries to recover from disasters while still repaying debt. We propose adding debt sustainability assessments must consider the increasing financial strain caused by climate disasters. When a climate crisis hits a country, its priority should be rebuilding and protecting its people, not diverting funds to debt repayment. We call for automatic debt relief after major climate disasters so that resources can be directed towards recovery, resilience and future preparedness. Para 48D introduces state contingent clauses but does not address how climate vulnerability should be factored into debt agreements before disaster occurs. We propose adding climate vulnerability assessments must be built into debt agreements to ensure the high risk countries have access to lower borrowing costs and longer repayment terms. Financial institutions must not penalize climate vulnerable nations with higher interest rates, as this increases debt burdens for countries already struggling with climate risk. Regarding para 49, while liquidity support tools are necessary, they must not replicate the structural deficiencies of past debt relief mechanisms. We propose adding liquidity support must not come with austerity-based conditionalities that undermine social spending. To safeguard long-term sustainability, all liquidity tools must prioritize social protections, healthcare and climate adaptation investment. Para 50 discusses debt restructuring but does not address the unfair burden placed on climate vulnerable nations. We propose debt relief must recognize the historical responsibility of high emitting countries. Those most impacted by climate change should not have to take on more debt to recover from disasters they did not create. Paragraph 51B calls for improved credit rating methodologies. but ignores that climate investments are often penalised in financial systems. We propose adding, credit rating agencies must update their frameworks so that countries investing in climate resilience and sustainable infrastructures are not unfairly downgraded. These investments should be seen as strengthening an economy, not as financial risk. Making these changes, we can ensure that climate vulnerable nations are not trapped in an unjust financial system, prioritizing debt repayment over survival. This is not a just financial issue, but a matter of equity, justice, and human rights. Thank you.

Thank you very much. We are close to the top of the hour. We have been given five minutes after one, so we need to ensure that we move efficiently. We have four remaining speakers, and these will be Liberia, Costa Rica, South Africa, and then the United Republic of Tanzania. Liberia, you have the floor.

Thank you. Thank you, Mr. Facilitator. Liberia welcomes the opportunity to contribute and comment on the draft of the outcome document of the Fourth International Conference on Financing for Development. Liberia, like many developing nations, remains vulnerable to an unequal global financial system that limits access to affordable financing and fair representation. While global economy shapes how exacerbated our financial challenges, the structure governing international finance has remained largely unchanged. We call for the reform in global financial governance, ensuring that African nations have a stronger voice in institutions like the IMF and the World Bank. We emphasize the need for lower borrowing costs and more concessional financing tailored to the reality of LDCs. As debt vulnerability increases, We urge the global community to enhance debt restructuring frameworks and explore debt for development swap that align financial relief with sustainable development. We agree with paragraph 48D that calls for all creditor to include standardized state contingent clauses in loan and debt contracts. We also agree with the African group statement on debt and debt sustainability that the outcome document must outline concrete and ambitious measures to reform the national debt architecture and address a systematic inequality that perpetuates Africa's debt challenges. As Liberia is the caretaker of the last remaining part of the upper green reef forest ecosystem and it is consistently battling with beach erosion on our shores, we welcome climate centric financing paragraph 39, but this should not crowd out financing in support of other SDGs, especially in areas of education, care, social spending and infrastructure as these are so critical human development priorities in the LDC. Thank you.

Thank you very much. Costa Rica.

Thank you, co-facilitator. Paragraph 48D, Costa Rica believes it's vital to strengthen accountability and transparency. This is why we think it could be important to review the language on parliamentary supervision to take into account the situations of all states. Same part on strengthening capacities for better public debt management by developing countries. We believe it's important to look at the entities who would provide such support as well as international financial institutions. Moving on to C, on a single debt register, we believe it's important to take that into account while considering the global debt database of the International Monetary Fund. We'd appreciate clarification on that. 48F, on strengthening measures to curb corrupt lending and borrowing. Our country believes that this is fundamental and it would also be important to address in the paragraph the need for a definition and methodology for its characteristics, the characteristics of such lending and borrowing, and if it relates to other forms of financing too. Paragraph 50 on debt restructuring, we believe that this initial paragraph should cover how we can guarantee that restructuring doesn't lead to a credit downgrade by credit rating agencies. In the same first paragraph of paragraph 50, we think it's important to look at how we can guarantee that resources freed up from such restructuring would be rechanneled towards national policies and programmes which have a high social impact. Thank you.

Thank you very much. I now have South Africa, then Tanzania. South Africa.

One of the advantages of speaking last is that from this perch, you can see that there's lots of disagreement in the room on this topic. This is, it's a pity because given recent political changes, I think everyone's expecting a high inflation environment. And a much stronger dollar, and it seems that sooner rather than later, we're going to hit a debt wall, and, uh, uh, we're gonna have, uh, a, a, a, a lot of, uh, uh, restructurings to face, and a lot of pain, and so I think in, in this context, it's, uh, it's very good that we, um… We, we, uh, discuss moonshots, but it's also very important that we concentrate on, on practical high commitment, uh, actions that we can all agree on, uh, that will actually be implemented after the conference. And so we, we don't have all the answers, but some things are already in the text and we feel they could be given more prominence. Uh, one, for example, would be to consider more technical support to empower developing countries to navigate asymmetries in their debt negotiations through the better use of their own data to do their own debt sustainability analysis, for example, through enhancing access and use of tools such as UNCTAD's debt management and financial system management database. Another would be the wider use of credit enhancements to lower borrowing costs. A third would be strengthening assistance as India proposed to countries to enhance their engagement with credit rating agencies. And I see you've mentioned the African Legal Resource Facility, which already does this. As has been pointed out by many, concessional finance is also a very important part of the solution. We wanted to thank the co-facilitators for adding language on the AfDB-IADB hybrid capital facility. And we'd also like to see a call in the document, as the UK asked for yesterday as well, for more robust support for the African Development Bank replenishment, which will be taking place at the end of this year. On paragraph 50, we agree with Australia and Iceland and others that MDBs should not participate in debt relief. That would be tantamount to asking poor countries to bear the costs of debt relief. We think it would be irresponsible and that it makes no sense to weaken MDBs at the very same time that we're calling on them to do more for development. On, on 48C, I just note for, for a global debt registry to be effective, it would have to be accompanied by a reckless lending provision. On, on 50A here, we just need to be more precise with the language because at the moment it also includes high income countries in, uh, it's inviting the G20 to include high income countries, so we just be more specific about who we actually referring to when we're talking about expanding eligibility. Uh, finally, um, we, we, we, we must also tread, as others have said, very carefully in anything we do, do the technical analysis. to be careful both about moral hazard and about unintended consequences that may end up doing the opposite of what we want, which is to increase borrowing costs and limit access to credit. Thank you.

Thank you very much. Now we have the last speaker from Tanzania.

Thank you, co-chair. United Republic of Tanzania appreciates the document Recognition of comprehensive debt relief mechanisms and innovative instruments such as debt for climate swaps and state contingent clauses. These measures are essential for developing countries while raising debt burden, constraining fiscal space for critical investments. Paragraph 47, which addresses several key points related to debt sustainability, could benefit from more specific recommendations or solutions to support its arguments. such as multilateral approach to debt issues, more effective and timely debt restructuring mechanism, and the discussion on how debt service burden constrain fiscal space. for investments in developing countries, especially in areas such as health, education, and climate change. Para 51 discusses sovereign debt sustainability assessment and credit rating, but does not fully address the challenges faced by developing countries. While it called for refining debt sustainability assessment to include SDG spending needs and climate risk, it overlooks developing countries' limited capacity to conduct independent evaluations. Greater support is needed to strengthen our institutional ability to assess debt sustainability. While this paragraph suggests reducing enhance on credit ratings, it fails to offer specific actions to mitigate the negative impact on capital access. It should advocate for alternative risk assessment framework that are more suitable for developing countries, strengthening capacity building efforts, reforming rating methodology, methodologies and preventing punitive downgrades are crucial to ensuring that developing countries can secure affordable financing for sustainable development. In this context, we call for further refinement on the document to better reflect the priorities and challenges faced by developing countries in managing debt and ensuring sustainable growth. I thank you.

I thank the representative of the United Republic of Tanzania. We have now heard the last speaker for this morning session, ladies and gentlemen. The Preparatory Committee will meet this afternoon at 3:00 p.m. in this conference room, and we'll hear comments on the next session, which is, quote, addressing systemic issues, end quote. To be specific, we'll be looking at paragraphs 52 to 57. Paragraphs 52 to 57 will be our focus. The program for the meetings for the session is available on iGov portal, so have a look at it there. Also to remind delegates that please send in your written comments, do not hold them until the end of the week. We want to look at them as soon as possible. I thank you for your participation and this meeting stands adjourned.