(Part 2) Fourth Preparatory Committee for the FFD4 (4th PrepCom)

Dear friends, should we find our seats and get started, because, as usual, time is of the essence. Excellencies, distinguished delegates, I call to order the first informal meeting of the FFD4 Preparatory Committee at its first session. Welcome to this informal meeting, which will provide an opportunity for expert technical discussions on critical issues under discussion in the draft outcome document of the conference. This afternoon, we will have three panel discussions. The first will be on the international financial architecture and systemic issues. The second one will be on debt and the cost of borrowing, and the last one on science, technology, innovation, and capacity building. So dear friends, on behalf of my fellow co-facilitators, it is my pleasure to moderate this panel together with Ambassador Milambo of Zambia on the discussion on the international financial architecture and systemic issues. Supporting reform of the international financial architecture, which is the set of international financial frameworks, rules, institutions and markets that safeguard the stability and functions of the global monetary and financial systems, is an explicit mandate for FFD4. Many such reforms have been undertaken since 2020 in response to the series of global shocks and crises, but they have not kept pace with rising needs, changes in the global geopolitical environment and new challenges in the financial system. The first draft of the outcome document puts forward a set of proposals for IFA reforms, building on the pact for the future. It addresses global governance and contains actions to increase the voice and representation of developing countries in the governance of the international financial institutions in order to ensure a fair, transparent and responsive system that adapts to country-specific needs. To improve crisis prevention, the draft contains actions for a stronger and more efficient global financial safety net through improvements in IMF facilities, suggestions related to special drawing rights and strengthened regional financial arrangements. A well functioning safety net can enable countries to focus resources on long term investments needed to achieve sustainable development, rather than on self insurance and short term crisis management. Adjustment to financial regulation could also unlock resources by reducing the cost of capital for developing countries. including through recalibrating the pricing of risk and reducing the mechanistic reliance on credit ratings from private ratings agencies. Panelists in this session are invited to pay particular attention in their interventions on strengthening the global financial safety net with the IMF at its center and Prudential and financial regulation topics. I invite the panellists to respond to the following guiding questions. What should be the main components of a new playbook on SDRs which would facilitate more timely decisions on issuance and rechanneling of SDRs, but without reducing or requiring changes in SDR rules and the nature of and role of the SDRs? How can IMF play a more effective role in the global financial safety net? These are actions 47G to J in the draft document. Second question, how can we further advance the review of potential miscalibrations in risk weightings within banking and financial standards? Which fora, bodies or committees could undertake such a review, action 49a. Regarding credit rating agencies, what can we learn from national experiences in regulation of credit ratings agencies and how can they inform the outcome document, actions 28m, 44a to c and 48a to c. And finally, How would the annual special high level meeting under the auspices of ECOSOC for dialogue with credit rating agencies need to be designed to advance relevant actions in the outcome document and be effective and impactful? Actions 48a. So with this, I give the floor over to Ambassador Milambo.

Thank you very much, Ambassador Merete. And good afternoon to you all. I think we have a very exciting discussion coming up. So now we shall hear the presentations from our distinguished panelists. I'd like to remind our panelists to be concise and concrete in your interventions, and you will have four minutes each for your intervention. And I invite you to speak specifically to the first draft outcome document and how you want to strengthen the actions of a strong outcome in Seville. I now give the floor to our first presenter from the National Treasury of South Africa, Deborah Lee Swanepoel.

Thank you, Ambassador, and thank you for the opportunity to be here and to share some insights from our perspective on how the documents can be structured and strengthened. We've had a lot of discussions over the last few days about the great investment opportunities that exist in developing countries, but access to finance necessary to turn these opportunities into reality is constrained by a host of challenges, including limited investor confidence and high perceived investment risks, lack of project pipelines, and other domestic factors. Therefore, it's important that we consider the potential that different layers, levers in the international financial architecture has to respond to these challenges. Turning to the questions that have been put before us on the SDR playbook. From our perspective, a practical SDR playbook would offer a clear plan, agreed frameworks, and political pathways to make better use of SDRs in future crises without changing the legal nature of SDRs. One component of this could be pre-agreed triggers and political consensus mechanisms for SDR allocations. This could include defining indicative macroeconomic scenarios for example, global financial shocks, pandemics, climate crises that could justify an SDR issuance. We could also look at creating a permanent political coordination process to speed up decision making and reduce delays in future SDR issuances. Another key component would be to set up a clear menu of rechanneling options to create a standardized IMF endorsed menu of voluntary rechanneling mechanisms, including, for example, contributions to the RST, unlending through multilateral development banks, and the use of SDRs via regional financing arrangements. Essentially, we need this playbook to provide a template of SDR-based hybrid capital models for MDBs that can support long-term development finance. The African Development Bank has been a pioneer in this field with structuring a hybrid capital instrument, which in compliance with IMF and most central bank requirements for maintaining the foreign exchange reserve status for SDRs. Through this instrument, the African Development Bank can multiply SDRs that it receives by a factor of three to four, transforming them from a static foreign reserve asset into lending instruments. For instance, $5 billion in ACRs can translate to between 15 and 20 billion of new financing for the African continent. We see a major outcome of SEVIB endorsing as endorsing the hybrid capital model at FF4. And this would send a strong signal of political will and ambition to scale up development finance using innovative tools. Moving on to international standard setting bodies, These bodies, including the Financial Stability Board and the Basel Committee, play a central role in the development of global financial regulations and policies aimed at enhancing financial stability. Their independence is fundamental to many aspects of their work. This includes that no single country or interest group dominates the agenda or outcomes, and this fosters broad-based international buy-in. This independence helps ensure that regulatory decisions are not driven by short-term political or commercial interests, but by long-term financial stability goals. This results in credible, rigorous standards that markets trust and regulators can implement with confidence. Therefore, it is important that any recommendations made related to international standard-setting bodies are made within this context. Moving on to the question around credit rating agencies from a national perspective, within the South African context, we have a dedicated law for credit rating agencies, which helps ensure that they are well regulated and accountable. The Financial Sector Conduct Authority, our financial sector regulator, provides ongoing supervision, making sure agencies follow clear rules and use transparent methods. Agencies operating in South Africa must be locally licensed, which improves accountability and responsiveness to the local market. The framework also encourages competition, helping reduce over-reliance on the largest global rating agencies. These experiences show the importance of strong national regulation, transparent practices, and diverse voices in credit rating systems. We have also institutionalized the functioning and managing of managing the credit rating process within the national treasury of South Africa. Over the last few days, there's been a few opportunities to have open discussions with credit rating agencies in some of the side events that have been structured. And some of my key takeaways from these discussions have been that they are very pleased to have a seat around the table and that they are open for discussions and consultations. But it is important to have continuous engagement with credit rating agencies at the country level. This is important to build and manage the relationship at a national level and possibly regional level and have continuous dialogue with the credit rating agencies. There's also an important need for multilateral institutions to support countries in building the capacity to manage these relationships. We understand that a lot of work is being done through the UNDP and the African Union in this regard as well, but these efforts need to be strengthened. With regards to how the engagement between ECOSOC and the credit rating agencies can be structured, We think that this would be a good platform to discuss methodologies, identify areas for transparency improvements, and sharing best practices between countries on institutionalizing the management of credit rating processes within countries. But this would need to be Last points, it's time. This would need to be a very structured dialogue, an open platform for engagement that is not focused on statements, but really having a discussion between the credit rating agencies and member states. Thank you.

Thank you very much, Deborah Lee Swanepoel. That's the correct pronunciation. Very, very, very concise and to the point presentation. I think very practical as we had requested. I like the various points on the SDR and talk about having a clear plan to make them better, better use for future situations. The trigger, clear about the trigger. You touched on the issue of the streamlining the political process for decision. the framework for rechanneling. I think you brought up very many issues that really are quite practical in this space. So now we'll transition to William Roux from the Ministry of Economy, Finance, and Industrial and Digital Sovereignty of France. So William Roux, the floor is yours. Same questions.

Thank you very much. I'm very honored to be in this panel and to talk about the international financial architecture. I have the pleasure and the honor to co-chair with Korea, the International Financial Architecture Working Group of the G20. And many of the points you have raised resonate with the agenda of the G20. You have not mentioned in this paper MDBs, but just to highlight very quickly how important they are in the international financial architecture. We have a roadmap to make them better, bigger, more effective, for them to work as a system with country platforms, with public development banks. I'm sure that Remy Riou will develop that in the context of the Finance in Common network. They need also to implement innovative tools like a risk sharing instrument, and it's important to draw some lessons and to incentivize MDBs to dedicate more capital, more resources for these innovative tools to mobilize private finance. We ask, it's also very important that they are able to provide financing in local currency. There are different ways to do that. And we will have also in the context of the G20 work to compare the different instruments for the MDBs to be able to provide local currency. And at the end, it's also a question of capacity of MDBs and first optimizing their capital, the way they use the capital, but also being open to capital increase when there is a good case. And in the medium term of the FFD4 text in a 10-year horizon, I think a qualitative message about increasing the capital of MDB, including through hybrid capital, it makes a lot of sense. Regarding IMF, the first question you raise is about SDRs. We have seen in the context of the COVID crisis that there are different ways to support vulnerable countries in the context of a pandemic, a global pandemic. A lot of IMF supported the program, World Bank financing, but indeed the issuance of SDRs with the exceptional issuance in 2021, compliment was also very, very important. Uh, I like the way you have framed the question, and the idea is not to change the rules, the policies, but just to draw some lessons on the previous, um, on the last issuance. And I think drawing lessons, you are right. Is it possible to have a specific trigger well defined in advance? It is the point made by South Africa, perhaps, but I have the feeling that at the end we need a board discussion between the executive directors of the IMF board. At the end, it remains a qualitative assessment, but very important to have all the different voices heard in that context. What is indeed very important is to complement the direct allocation with SDR channeling. France, together with many other partners, we have pushed a lot for that. It has helped to strengthen the poverty reduction and growth trust at the IMF. It has helped to create a new resilience and sustainability trust. And we put in place this global ambition of 100 billion of SDRs to be mobilized to vulnerable countries. We have achieved this commitment. We are monitoring the delivery of this commitment every year in the context of the G20. And I agree with South Africa that the SDR to MDB option is something which is on the table. We have a concrete proposal from African Development Bank and Inter-American Development Bank. There is a need to have four or five countries able to channel these SDRs. We also to have a second layer to guarantee this scheme. France is committed to be part of this second layer and I really hope that ahead of the CEVI conference we could create this momentum to make it happen. IMF has also to be active in terms of surveillance, financing and technical assistance. I would like to stress the importance of precautionary facilities which could complement a successful IMF supported program. We could propose that low income countries could have access to this type of precautionary facilities. Then you have how to strengthen regional financial arrangements. I think this point is very, very relevant. First, IMF could strengthen the dialogue with the existing regional financial arrangements, but also to look at how we could support the creation of additional new regional financial arrangements in areas which are not covered yet by regional financial arrangements and to understand what, where are the bottlenecks and to see how we could support that. And of course, for MDBs, an MDB agenda, IMF agenda, we should not forget the call for a better representation of the countries already underrepresented in order to continue to ensure the legitimacy of IMF and World Bank. Regarding the financial and prudential regulations, I fully agree with what South Africa said, it is first and foremost regulation to strengthen and to ensure financial stability. So the first call should be a call for implementing already agreed standards, including Basel III, and to continue to support a risk-based approach for these regulations. In that regard, I saw in the text that draft that there is a specific sentence on asset management industry. Not sure that I have understood why it is pointed out like that, but I don't know if it is needed to go into these details and why it is specified like that. More broadly, I think that it's important to first, as I said, to implement the regulations, but also to be able to look at whether we have some discrepancies between the perceived risks and the real risk, the risk observed. And for that, to avoid this discrepancy. We need to have accurate data showing the real risk to invest in private projects in different countries. We need also to look at potential unintended consequences of the current regulation and for example the way MDBs guarantee are taken into account for the cost of capital for financial institutions and I think it would be interesting to propose the FSB, to invite the FSB to look at that. Regarding credit rating agencies, just can support fully what South Africa has said in order to save time. Thank you.

Thank you very much. I think this is extremely rich. You forgive me for extending the time really on that one because So just so much in there, which really speaks to the outcome documents. We're really, really grateful. We take note that you have a somewhat nuanced view on the issue of the triggers, but nonetheless, it's part of the process of discussion to have different views. Also, take note of what you highlighted on the hybrid capital. That's critical and we take note that there's a first layer, we need at least five countries before we can really move forward. And just really to appreciate France for coming forward on the second layer to provide the guarantee layer, which is there. And I think that was a call to action. The other countries that were able to come through are in this room and they hear you. So we look forward to countries stepping forward. Now we turn to our third presentation. by Ms. Geetu Joshi, Department of Economic Affairs, Ministry of Finance of India. The floor is yours.

Thank you, Ambassador. I'm pleased to offer India's views on strengthening the global financial architecture to better support sustainable development and financial stability. First on IMF, we certainly need a more effective global financial safety net. The frequency of crisis is increasing, public debt is soaring, cost of debt servicing is increasing, there is volatility and uncertainty, including in commodity markets on which many low-income countries rely. Amidst this crisis-prone environment, the IMF must ensure timely response for countries in need. IMF should watch for countries during its surveillance exercises with a lens that cautions against any possible macroeconomic instability. Ensuring liquidity through innovative ways will prevent many cases of insolvency. This is the core role of the IMF and we need to position the Fund more centrally within the GFSN. On special drawing rights, I think that enhancing the liquidity and effective use of existing SDRs is essential before we consider any new allocations. In this context, additional allocations may be premature. We have a recent US dollar 650 billion equivalent of SDRs issued in 2021, which remains underutilized. Excessive issuance of SDR has implications for price stability in member countries, and therefore the IMF should be examining such issues towards designing a new playbook on SDRs. We also need to respect the reserve asset character of the SDRs. Therefore, the rechanneling of SDRs must remain voluntary, as also stated by the South African colleague, while ensuring that they remain liquid. Second, on the suggestion for FSB to review potential miscalibration of risk ratings, we understand that Basel norms are vital for safeguarding financial stability. Diluting them, even to reduce the cost of capital, may erode capital buffers and increase systemic risks. In fact, it is because of the constrained and costly financing and mounting development needs that countries fall into debt traps. Therefore, my third point is on credit rating agencies. Sovereign ratings remain a significant barrier for developing countries in accessing affordable capital. Persistent pro-cyclicality and rating stickiness often delay the recognition of improvements in policy and institutional quality. more broadly, international community, including MDBs, must engage with credit rating agencies and promote the adoption of rating methodologies that go beyond mechanical indicators, incorporate a nuanced assessment of capacity and willingness to repay, and account for a country's unique economic circumstances. Finally, the annual high-level meeting under ECOSOC should focus on critically reviewing credit rating agencies' methodologies for both sovereigns and corporates with emphasis on greater transparency and accountability, while also recognizing the achievements of developing countries in containing fiscal deficits and implementing reforms. In conclusion, a stronger global financial architecture must be flexible, fair, and aligned with development priorities, supporting global financial stability while enabling inclusive and sustainable growth. To end, I would like to place the maximum emphasis on increasing the flow of long-term affordable finance to low-income countries and developing countries. That is what FFD4 should aim for. Thank you.

Thank you very much, Ms. Joshi. We see very close alignments between our three presenters. And now we give the floor very quickly to the discussants to share their reflections on the guiding questions and the comments by our panel. You have three minutes to make your interventions. And I'll give the floor to our first discussant, Mr. Remy Roux. Chief Executive Officer of France Development Agency, AFD, and the President of France in Common. The floor is yours for your presentation.

Excellencies, many challenging issues remaining between the parties before Seville, of course. So let me focus on good news and an initiative that is consensual at scale and that could be the foundation for many positive changes. with the hope you will give it a full and explicit recognition and encouragement in the conclusion of FFD4. I'm referring to the Finance in Common system movement, FIX, the gathering of all 530 plus public development banks in the world, multilateral, international, regional, but also national and subnational. active in each and every UN member states, weighing 2.5 trillion US dollar public investments each year, about 15% of total investments globally. In February, our fifth finance in common summit gathered more than 2,500 participants in Cape Town, hosted by DBSA, our South African member, and the AIIB for concrete solutions on reforming the international financial architecture and financing the SDGs. We approved the communique, published the reference book, and sent UN DESA a substantive report to contribute to FF4 on behalf of all the banks. Our proposals are, first, fully embark national and subnational development banks in the architecture, considering their legitimacy and critical mass in global annual investments. National development banks are SDG enablers by embedding sustainability at the core of their mandates and operations. The direct integration of national development banks into global financial discussions will help unlock significant resources and strengthen country-led platforms. Second, foster collaboration among all public development banks to work as a unified financial architecture. PDBs can leverage their complementarities from origination to financing, from the first to the last mile, with a special role for multilateral development banks to support the others with their guarantees, technical assistance program, and collaborative platforms. PDBs need to operate as a vast, coherent, and capillary system to improve efficiency, interoperability, leverage local expertise, and originate more quality projects. Third, fix is about solutions. To reduce the cost of capital, we notably propose doubling the number of PDBs issuing bonds by 2030 to form a new asset class, operationalizing and giving credibility to carbon markets as decided in Baku, harmonizing vertical funds accreditation procedures for more direct access, increasing financing in local currency and channeling domestic savings into long-term investments.

I thank our first discussant. Apologies for that. And I'll give the floor to the next discussant, which is Mr. Jose Antonio Ocampo, professor at the Columbia University. The floor is yours. Three minutes.

Yeah, Excellencies, let me summarize the recommendations on the financial safety net of the independent commission of experts that I had the opportunity to chair, and you have the report in your hands. The first recommendation that we have is that the IMF facilities for low-income countries should continue to improve, as well as the creation of more continuous credit lines like the flexible credit line. The second is that conditionality should be strictly macroeconomic, but with support to social spending during crisis. Third, that the IMF should create a swap facility as well as a fund to intervene in the bond markets of emerging and developing countries during crisis to try to replicate what the Fed and the European Central Banks have done during crisis, but the developing countries don't have the capacity to intervene that way. Fourth, in relation to special drawing rights, to make a broader use of them, we recommend that it is essential to eliminate the dual accounting of the IMF and the SDRs should then be considered as deposits of countries in the IMF, which the IMF can lend, or countries can channel them for funds in the multilateral development banks. or other funds, always with the essential characteristic that the reserve character of the funds of the SDRs have to be protected. Fifth, in relation to the governance of the IMF, the IMF quotas have to be increased and the distribution have to be done according to the current size of the developing countries. The basic votes have to be enhanced, going back to the one-ninth that were in the Bretton Woods agreement, because they are essential for small and poor countries. And we also recommend the open election of the head of both the IMF and the World Bank president. And finally, the creation of a multiple set of regional monetary arrangements. which is one of the missing architectures in the central monetary system should have the same system at the Multilateral Development Banks. So a global institution, but also regional institutions in every part of the world. Thank you.

Thank you, Professor. Most grateful to both our discussants for very rich comments there. Very quickly, we now move to open the floor. And so now I open the floor for comments or questions regarding the presentation we have just heard. Delegations wishing to request the floor should indicate their intention by pressing the button on the microphone console. Before giving the floor to the first speaker, I kindly request delegations to observe the time limit of two minutes, two minutes for your interventions, and we shall cut the line mechanically. To ensure proper interpretation, delegations are asked to speak in a normal pace and to provide a written copy of statements to estatements@un.org, that's estatements@org, at least two hours before delivery. All right, it's already too late. Anyway, in order to keep track of time, we shall have the countdown that will help you there. So having said that very quickly, I have already seven speakers. Starting with Colombia on behalf of the G77, Colombia, then Honduras, Cuba, China.

Thank you, co-chair. The G77 and China appreciates the convening of this panel. First of all, the group would like to reiterate that a necessary prerequisite to strengthen the global financial safety net is to ensure a fair and inclusive global economic governance where developing countries representation is enhanced along with their voting power in international financial institutions. With that, we insist that it is critical to restore basic votes back to one ninth the total voting rights in the IMF and advance a comprehensive and successful World Bank shareholder review in 2025 in line with the Lima shareholding principles. The decision making processes of these institutions need to become more transparent and accountable and the leadership needs to reflect geographical balance and merit. Having said that, the group once more appreciates the work of the co-facilitators in putting forward technically supported proposals. We would like to emphasize that the global financial safety net needs to be expanded, it should take into account multidimensional vulnerability and needs to be more reliable to allow developing countries to expand their investment in their sustainable development. Currently, developing countries lack a reliable mechanism to support their financial markets during major scale financial crisis, a problem developed countries do not face as they have been able to rescue their markets with bilateral support. We therefore call for discussing an IMF multilateral swap line that can enhance the institution's role as a provider of insurance for developing countries economies. We have been also very clear about the need to better harness the potential of SDRs to address liquidity challenges. We are convinced that a playbook will be a step in the right direction to make the insurance of SDRs more efficiently. We call for the voluntary rechanneling of 50% of covering unused SDRs by developed countries to developing countries. Can I ask a clarification since I'm speaking on behalf of a group, do I get more time or is it?

No, no, no, no, no, no, no, no, no.

Okay, thank you. Then I will stop there and finish. Thank you.

Thank you for your flexibility. Very quickly, and by the way, I do want to close the speaking list. So we'll be closing the speaking list. We have several countries requesting the floor. The next will be after Colombia is Honduras, Cuba, China, United Republic of Tanzania. So Honduras, the floor is yours.

Thank you. We would like to thank the co-facilitators for the work that has been done on the path to Seville. You can count on our support. At this stage, we would like to say the following. We believe that the global financing framework must be renewed and tailored to these new times of uncertainty. The new financial architecture for development should be aligned with the systematic challenges at the moment, allowing for agile, flexible responses to very quickly changing crises. The climate and other forms of crisis have made it clear that the current system isn't focused on the needs of our peoples. Therefore, we strongly suggest that it is the right time for through restructuring of the international financial architecture, which not only responds to current systematic challenges but also allows us to flexibly respond to quickly changing situations and to focus on the interests of people and not of capital. It's undeniable that the global financial system is biased and is exclusive and is bankrupt. It favours the few and condemns the many. It doesn't allow the effective participation of the global south in this area nor does it allow fair equal access of those countries to resources for development therefore we demand this restructuring which would reflect the needs of the people of the global south many developing countries are grappling with unsustainable levels of indebtedness which restrict their ability to invest in sustainable development therefore it's imperative to move towards a new multilateral agreement that would diminish the debt Thank you very much.

I thank the distinguished representative of Honduras. I now give the floor to the distinguished representative of Cuba, who will be followed by the distinguished representative from China. So Cuba, you have the floor.

Thank you, co-facilitator. Generally speaking, we are concerned by the pressure of developed countries to dilute and undermine this particular section. This provides the framework for us to make reforms to the international financial architecture in an inclusive framework. Therefore, our expectation is to have a document that proposes practical solutions and increases the representation and the voice of developing countries in global economic governance. Special drawing rights must play a much more active role in ensuring funding for development. We must try to decouple the allocation of SDRs from the IMF's quota system so that their distribution is focused on economic needs rather than a system of established quotas. This challenge, this change would promote change in the global financial structure so that the IMF can play a more important role in the financial safety net. We need to restructure finance to ensure the equitable representation of developing countries in its governing bodies. We need to also recognize the vulnerable nature of developing countries and should not apply single recipes or counterproductive formulae. the IMF in the global safety net needs a development of reform of its governance structures, among other things. Thank you.

I thank the distinguished representative of Cuba, and I'll give the floor to the distinguished representative from China, who will be followed by the distinguished representative from the United Republic of Tanzania. Then we'll have Tuvalu, Costa Rica, Bangladesh, then Chile. So China, you have the floor.

Thank you, Chair. I completely agree with the, I align myself with the statement made by Colombia on behalf of G77 China. Currently, unilateralism, protectionism, and economic bullying are rampant, and the unjust and unreasonable international economic order severely hinders the sustainable development of developing countries. The international community should strengthen solidarity and cooperation, reform economic governance so that it can respond to global challenges more timely and effectively. I'd like to mention three points. First, we should defend multilateralism. Uphold the rules based multilateral trading system with WTO at its core, promote trade liberalization and facilitation, resolutely oppose all forms of protectionism and arbitrary tariffs. Second, we must enhance global economic governance and reform international financial architecture to better reflect the changes in global economic landscape and better serve the economic growth of global cells. We look forward to the 2025 World Bank shareholding review to address shareholding misalignment and make adjustments to the IMF's quota so as to enhance the voice and representation of the global south. We must strengthen the credibility and the legitimacy of Bretton Woods institutions. We look forward to the World Bank's enhanced lending capacities replenishment and the operation of IDA21 as scheduled and so as to provide more affordable lending to developing countries. Third, we must strengthen macroeconomic policy coordination. Developed countries must shoulder the responsibilities to prevent negative spillover effects from their monetary policy adjustments. It's important to improve the financial risk regulation system and build a solid global financial safety net. Thank you.

I thank the distinguished representative of China. I now give the floor to the distinguished representative of the Republic of United Republic of Tanzania, Ntawalo. Tanzania, you have the floor.

Thank you, Mr. Chairman. As the global financial system continues to face structural stress and unequal recovery pathways, reforming the international financial architecture is central and to our collective response. A new playbook on special drawing rights should institutionalize timely issuance of times of systemic shocks and streamline rechanneling of mechanisms through multilateral development banks and regional institutions. This can be achieved without altering the SDR rules by leveraging the existing legal frameworks and ensuring broader participation from developing countries. The IMF must become more agile in its crisis response with simplified access to precautionary tools and enhanced surveillance that factors climate and development vulnerability. On financial regulations, we support the global review of risk weightings within the Basel framework. The current calibration often penalizes investment in developing countries by overstating risk and increasing capital cost. A joint technical task force under Financial Stability Board with the contribution from UN agencies could lead this review and proposed reforms. Regarding the credit rating agencies, national experience highlights the need for enhanced oversight transparency of methodologies and the separation of rating from advisory functions. The proposed ECOSOC dialogue should be data-driven, inclusive, and aimed at creating international standards for accountability and fair assessment. Thank you, Mr. Chairman.

Thank you very much. And I'll give the floor to the distinguished representative of Costa Rica, will be followed by Bangla, sorry, Tuvalu, then Costa Rica. So Tuvalu, you have the floor.

Thank you, Chair. Tuvalu emphasizes that the international financial architecture must be overhauled to serve the needs of climate vulnerable nations. More specifically, IFIs must realign the application of their mandate in a manner that is responsive to the evolving challenges faced by the most vulnerable countries like LDCs and SEEDS. I now wish to offer three points.

First, the IMF role.

The IMF in applying its mandates to help countries maintain macroeconomic and financial stability must evolve beyond its traditional modalities of civilians, landing and capacity building. It should place greater emphasis on integrating structural challenges, including climate change, into its core operation to enhance alignments with the SDGs. Second, the SDRs for climate resilience, a new SDR playbook must enable rapid and predictable reallocations via MDBs in order to better respond to global crisis, including the urgency of addressing the macro critical risk. related to climate change. SDRA rechanneling offers a cost-neutral alternative that makes much sense in the current landscape of heightened fiscal constraints. With its reserve asset character being protected by keeping it within the IMF system, the rechanneling allows MDBs to leverage additional finance that could potentially be used for adaptation and loss and damage. Further credit rating agencies, the methodology of credit rating agencies often fail to capture the nuances of climate vulnerability, and investment in resilience building, often resulting in downgraded ratings and high borrowing costs for seats. To address these systemic shortcomings, regulatory frameworks must be strengthened, drawing on national experiences to inform the development of robust international standards to enhance transparency and accountability of credit rating agencies practices.

Thank you.

I thank the distinguished representative of Tuvalu and now give the floor to the representative from Costa Rica, then Bangladesh, Costa Rica.

Thank you, Mr. Co-facilitator. Costa Rica, firstly, would like to thank the panelists for the substantive contributions that they've made, which obviously enrich our discussion. Our country deems it positive that this section, with its clarification, includes more specific commitments on accountability and oversight of international financial institutions. Furthermore, we value the language that strengthens the importance of aligning international financial structures with the 2030 Agenda and the Sustainable Development Goals. In particular, we highlight the recognition of the urgent need to ensure adequate, predictable and accessible climate financing for adaptation, as well as for mitigation and response to loss and damage. We believe it's indispensable that international financial institutions evolve towards a more inclusive and representative form of governance reflecting the needs and priorities of developing countries. Finally, we welcome the strengthening of concrete commitments such as the creation of new financial instruments, the review of decision-making mechanisms in international financial institutions, and the promotion of innovative measures that reduce the structural vulnerability of developing countries. Costa Rica reiterates its commitment to an international financial system that is truly committed to sustainable development. Thank you.

Thank you very much. We have two more speakers. I really apologize because of the time constraint. Bangladesh, then Chile, and then we'll allow the panelists to perhaps respond in a minute each. And then those who have requested the floor maybe can compress their questions and comments for the next session. I now give the floor to the representative from Bangladesh.

Thank you, Mr. Facilitator. We welcome the text's recognition that governance arrangements in IFAs remain outdated and unrepresentative. Enhancing the voice and representation of developing countries, must be accompanied by institutional reform mandates. We must consider setting a target year by which a considerable number of executive board seats in IFIs should be held by low and middle income countries. Alongside geographical representation, Wi-Fi's voting power, quota realignment, and representation in senior management should reflect the economic condition, development stage, country's level of engagement, population size, and vulnerabilities. While the mention of gender-balanced leadership is positive, deeper reforms must also include mandatory rotation of leadership among and within regions, particularly for senior IMF and World Bank positions. We welcome the focus on IMF quota realignment. We urge inclusion of a commitment to review the voting formula itself. The proposed measures to improve global financial safety nets are promising. However, affected nations continue to face unequal access and delays in times of crisis. We propose the establishment of an automated trigger-based access mechanism for low and middle income countries during climate or conflict related shocks. On credit rating agencies, we strongly support the call for transparency and accountability.

I thank the distinguished speaker from Bangladesh. We have Chile, and we may have space for at least one member of civil society to say something. But for now, Chile, the floor is yours.

Mr President, Chile firmly supports the need for a deep rooted reform of international financial architecture. The current system was designed in a very different context to that we are living in today, and it has shown structural limitations to be able to respond to the increasing financing needs for developing countries and to support a truly sustainable and inclusive form of development. We welcome the fact that the first draft of the outcome document provides specific specific outcomes for reforming this and to ensure to improve the representation of developing countries in the governance of international financial institutions. These are fundamental steps to build a fairer, more effective and more tailor-made financial architecture. We also support the need to move towards more predictable and flexible structures in allocation of SDRs, ensuring their full levels of recovery. We also underscore the need to look at risk assessment, which very often penalizes developing countries and impedes their access to financing. deepening wealth divides. We believe that there are certain things suggested in the draft that could also ensure further accountability and transparency in this area. Chile believes that there will be no effective financing for development without an international financial architecture that is truly representative and transparent. The FFD4 should mark a before and after. We cannot continue with a system that was designed 80 years ago And we need one that is in line with today's challenges. Thank you very much.

I thank the distinguished representative from Chile. I now give the floor to a representative from civil society, that's the African Sovereign Debt Justice Network and Society for International Development Civil Society FFD Mechanism. The floor is yours for two minutes, and then we'll get back to our panelists for a minute each.

Chair. The monopoly held by private credit rating agencies in determining sovereign credit worthiness has become a silent weapon of economic coercion. A public credit rating agency under the UN, therefore, is not just overdue, it is imperative for justice and global financial stability. Recent pandemic and debt crisis have exposed the current disfunctionalities in terms of bias, inaccuracy and pro-cyclicality in ratings and market concentration, the representatives of Burkina Faso and Tuvalu rightly pointed to this bias and its impact on access to financing for the global south. With due consideration to this pro-cyclical bias, we emphasize that CRA reform is urgent, given the prospects of a downturn in the global economy arising from current geopolitical tensions and tariff wars. The manner in which CRAs penalize sovereign states for restructuring debt obligations or when ecological disasters strike must be urgently addressed to safeguard functional incentives and effectiveness in the financial architecture. The reform of credit rating systems is therefore indispensable to ensure fair borrowing terms and preserve policy space to restructure debt toward the right to development. This analysis is precisely why we call for an intergovernmental commission under ECOSOC to regulate, monitor, and hold accountable the functions of CRAs. The proposed annual dialogue would not suffice. While such a commission will certainly include stakeholders consultations, more importantly, the commission must be firmly anchored in the normative power of agenda setting within intergovernmental processes. The critical role of such a commission, among other reforms, will be that of exploring the establishment of a multilateral public credit rating agency at the UN to provide more transparent, accurate, and equitable assessments of credit worthiness. FFD4 in Sava must mark the turning point where we move beyond the dominance of private CRAs and commit to building a UN-led public alternative.

Thank you very much. We now turn to our panelists. Thank you so much, everybody, for your rich interventions. We now turn to the panelists for a minute each. We'll start with Deborah Lee Swanepoel. The floor is yours.

Thank you, Ambassador, and thank you very much for the comments and inputs that were provided. There's a lot of consistency around the room in terms of what the paper should prioritize. Just to touch on two or three issues, I think we completely support the call for improving the voice and representation and echo the sentiments around the room that the MDBs and the IFIs more generally really do need to reflect today's reality. So completely support that. I would just like to reiterate the importance of maintaining the independence of the FSB and the Basel Committee and the role that this independence plays in ensuring that we have a strong and stable global financial architecture. So as we are considering the recommendations in that regard, we just need to keep that in mind. And then lastly, around credit rating agencies, I think it's important that we also consider the roles that the credit rating agencies plays vis-a-vis what we need countries to do at a country level as well. And how do we institutionalize and capacitate countries to be able to engage with the credit rating agencies effectively as well? So that's an important aspect. Thank you, Chair.

Thank you very much, Deborah Lee. Now, William Roos, one minute.

Thank you very

much. I will speak French. First, perhaps on the IMF and the World Bank.

Here we share the view that these two institutions must continue to evolve, but there must be nuance to this. We cannot say that these institutions are the same.

as they were 80 years ago.

The second point is to support what South Africa

just said on the importance of preserving the independence of standard setters, those who establish the standards for financial actors. This is extremely important for financial stability. And thirdly, on credit agencies,

We need to find a proper balance and have better dialogue between the credit agencies and countries, as countries must understand the methodology of these credit agencies. But we need to be sure that we don't think that we can easily reduce the capital cost

artificially. We must find the proper approach with some nuance. Thank you.

And now the last is from Ms. Jitu. Josh, the floor is yours. A minute.

Thank you, Chair. So thank you, colleagues, for your inputs, and I'm sure those will get incorporated, duly incorporated in the outcome document. So essentially, I'd just like to summarize with three key takeaways. One is that in addition to the IMF playing a central role in the global financial safety net, I think what is very important, which several colleagues did mention, is that strengthening MDBs through reforms is also a key element in improving the access to affordable and concessional financing for developing countries. As already said by colleagues on the panel, there is need for greater representation of developing countries. Uh, in governance of, uh, international financial institutions, uh, that was also stated by, uh, several of, uh, the participants here. And lastly, on, uh, credit rating agencies, I think, uh, it's important that they must provide more responsible assessments, uh, so that, the cost of capital is reduced, particularly for developing countries. Thank you.

Thank you very, very much. I thank the panelists, I thank the discussants, and really the various member states who made their interventions. A very, very rich discussion. We do want to transition to the next stage. We pass our apologies for those who were not able to make intervention. And at this moment, we'd like to take a brief pause for a lot of change. in the front desk. Thank you very much.

Hey.

A very warm welcome back to the discussion. In light of the time we have, we shall immediately get started. Distinguished ladies and gentlemen, we shall now begin the discussion on debt and the cost of borrowing. I'm pleased to welcome our distinguished panelists and discussants for this discussion. Ministers, excellencies, distinguished delegates, on behalf of my fellow co-facilitators, It is my pleasure to moderate this panel discussion together with Ambassador Merete. Amid successive crisis and shocks, sovereign debt challenges have become one of the greatest obstacles to realizing sustainable development. Many developing countries face high debt service burdens and borrowing costs, which severely constrain their fiscal space and ability to address poverty and inequality. and invest in sustainable development. Despite progress in reforming the debt architecture, restructurings are often still inadequate, late, and too lengthy. A development-oriented debt architecture based on sound and transparent analysis of debt analysis, the sustainability, is urgently needed to address these debt challenges. The debt chapter outlines four areas of actions to address these challenges, including actions to, one, strengthen debt management, debt transparency, and responsible borrowing and lending. Two, lower borrowing costs and enhance fiscal space for investment in sustainable development in developing countries. Three, achieve efficient, fair, predictable, coordinated, timely, and orderly restructurings. And four, promote debt sustainability and credit assessments that are more accurate, objective and long-term oriented. Panelists in this session are invited to pay particular attention to the proposals on strengthening and systematizing of liquidity and liability management support and on closing gaps in the debt architecture. I invite the panelists to respond to the following guiding questions. What are the key constraints to scaling up and ensuring coordinated support to countries to enhance fiscal space and lower their cost of borrowing and to provide related financial instruments such as debt swaps, credit enhancements at scale? The next question is how can we provide such support at scale, take into account the need for providing financial support and for responsiveness to country specific needs and circumstances? The third question, what are the most important, most critical gaps that need to be closed to create development oriented debt architecture? And these are actions 42, 42B and 43 respectively. I will now give the floor to the distinguished representative from Norway, Ambassador Ameretti.

Thank you very much, Chirola. So now we shall hear presentation by our distinguished panelists. I would kindly like to remind panellists to be concise and concrete in your interventions and speak for not more than four minutes. I invite you to speak specifically to the first draft of the outcome document and on how you want to strengthen the actions for a strong outcome in Seville. Let's start. I'll give the floor first to Mr. Phil Stevens, Foreign and Commonwealth and Development Office of the United Kingdom of Great Britain and Northern Ireland. Phil, you have the floor.

Thank you, chairs. It's a pleasure to be able to be part of this panel and talk on this important issue. I'm not at all surprised that debt has been a really important issue throughout this financing for development negotiation. We know it's a huge challenge for many countries. There are more than three billion people living around the world right now in countries where debt service payments are exceeding what that country is able to spend on either health or education. But just before I do get on to talk about debt, I did just want to say, and I think this is important for the outcome document as well, that when we think about debt, let's not only have a conversation about the numerator, let's also think about the denominator. And so what do I mean by that? What I mean is that debt is only unsustainable because the debt service payments are too high a share of revenues that countries can collect or because the debt stock is too high a share of GDP. So if we can help countries to raise more revenues, debt can become more sustainable. If we can get more private investment into countries that boost growth, and grow GDP, then debt can become more sustainable. So I just want to say that I don't think we should talk about debt as a numerator in the isolation of these other important conversations about revenue mobilization and private capital mobilization, which have been happening in and around this building over the last couple of days. But then this is a panel about debt, so let me now turn to the numerator and focus on that. I think the interesting thing about the debt challenges that many countries are facing that I've been hearing both this week and at the spring meetings last week as well, is that they're not such a homogenous set of challenges as I think many countries, low-income countries faced 20 years ago when we had a big round of debt relief. There are actually a number of different challenges that countries are facing, and they each require different solutions. And I think what's helpful is for the outcome document to reflect on those different challenges and the different solutions that we need for each. So let me take you one in turn. Firstly, there are a set of countries, as Zambia was a few years ago, that face very difficult solvency challenges. They're defaulting on their debt and they fundamentally need a restructuring. We have a mechanism for that, the common framework. It's been too slow. We need to make the common framework faster. We also need to broaden the eligibility as well to make it more eligible to some middle income countries. We also need to make sure the private sector is restructuring its debt efficiently. And there's been a great innovation over the last 20 years, which is something called collective action clauses. This is something that means that bondholders can't hold out when there's a debt restructuring, when others have agreed a restructuring. That's brilliant. That's actually really helped speed up bondholder negotiations and many debt treatments in recent years. However, we still don't have an equivalent for commercial bank loans. And that's why the UK has been championing something called majority voting provisions, which basically do the same as collective action clauses, for commercial bank loans. And I think this is something that needs to be adopted and should be included in the outcome document. Secondly, we've got a set of countries that face liquidity challenges, as I think Kenya did perhaps last year when it had a large Eurobond to repay. And in these situations, you need a surge of external finance that can come from multilateral development banks. But sometimes what we've seen is that the financing architecture isn't able to surge in and support countries in those situations. So we need to find new, more flexible ways of providing that financing support to prevent liquidity crises from becoming solvency crises. There's also a very large set of countries, I would argue, for whom they're not technically in a solvency crisis or a liquidity crisis, but they do have very high debt costs, and that is crowding out other spending on the SDGs. And here, you know, that is also an important issue and we should think about what the solutions can be to bring the debt servicing costs down. One solution is to have more concessional finance available. And I've been talking in a number of events this week about ways that we can scale up multilateral development banks, which are a big source of relatively cheap financing, using things like guarantees, hybrid capital, and even capital increases to make them bigger. But also there's been a lot of conversation I've been hearing about debt swaps, which I think in particular countries can work as a solution to also bring down the debt service costs. There have been some examples of debt swaps that haven't been done so well, and actually the cost of doing the swap have exceeded the savings, but there are some examples of good swaps as well, and I think we need to see more of the good swaps and should provide support to countries to do those swaps well. And then lastly, and I know I'm running out of time, There's a set of countries, well actually all countries need to avoid getting into debt challenges in the future. And so I think what we have already in the outcome document, but I think we can strengthen further, are a set of actions to try and prevent future debt crises. So that is around strengthening transparency, for example, of debt, making sure under the UK G7 in 2021, we got commitments from all the G7 countries to publish their loan books. Ideally that would be something that all countries would be doing around the world. We need natural disaster clauses that create an automatic pause in debt repayments when countries face a shock, be it climate change or a pandemic, that create the breathing room to again avoid a shock becoming a solvency crisis. We need capacity building for countries. We need to strengthen the debt sustainability framework that the IMF use for looking at debt sustainability to make sure that it takes proper account of countries vulnerabilities. And we need to make sure that all lenders are taking proper decisions about when when it's sustainable to lend to countries and when it's not, and thinking about the right instruments to use. And then just very, very lastly, because I know I'm out of time, I did want to acknowledge that I've had a lot of requests from partner countries for more say in the debt architecture. I think that's a really important thing. I've heard some really interesting ideas over the last couple of days about a potential debtor club, about maybe having more seats around the global sovereign debt roundtable. about creating more structures for conversations. I think all of those are worth exploring as potential solutions there. Thank you.

Thank you very much, Phil, and also for being so concrete in your suggestions to what we can look at. It's my pleasure then to pass the floor on to our next panelist, Ms. Monica Asuna from the National Treasury of Kenya. So, Ms. Monica, you have the floor.

Thank you so much, Madam Moderator, and it's a pleasure to be here. There are some issues that Stevens has talked about that I'll not dwell on, but just mentioning in passing, because the first question is issues about the fiscal space. For most countries of the Global South, we really know what is affecting us issues to do with high debt to GDP ratios, low domestic resource mobilisation as a result of either the large informal informal sector, tax evasion, lack of compliance by the citizens and also narrow tax bases. And this affects the capability of sovereigns to really mobilise enough domestic resources to be able to really free up the fiscal space. And issues of debt swaps have been talked about. This is basically as a liability management operation, but issues of political risk insurance and liquidity guarantees are still limiting in this area, because as we know, there is only one institution currently that provides political risk insurance. So this is an area that maybe needs to be taken up with other MDBs. Then concession on financing still, we must mention, is important. as it provides capital at a lower cost and also will ensure that sovereigns can access credit at scale. Extended credit facilities are important during tough economic times. But under para two, we note that it is limiting in that it does not speak to MICs and we know that most MICs face the middle income trap as well as debt distress. So this really needs to be reconsidered in the first draft. like in para 42B, providing technical assistance and building capacities of sovereigns to undertake debt swaps is important and the process is really very technical. Kenya has really tried to get into this space and the legal requirements is really too high. We were being told like 60 legal documents. Uh, for you to really undertake a debt swap. So that means capacities of to really undertake this is critical for us to have a really fast, uh, time turnaround to really realize the, the savings and also to be able to have the resources to, uh, realize development. So other IFIs or MDBs also need to consider putting in place the political risk insurance and liquidity guarantees facilities to enable sovereigns who intend to undertake debt swaps to really access that. I will also reiterate some of the issues that have been advanced by the Africa Group in terms of what are those critical gaps that we want to see, and some of them already are in the first draft. I will reiterate what has come out of the Africa Group and G77 and China, creation of a multilateral sovereign debt workout mechanism centred on sustainable development, establishment of a global debt authority with a predictable and inclusive mandate, Reform of the G20 common framework to enhance its inclusivity, speed, and development outcomes. Also enhance the role of regional MDBs and boost the provision of affordable, flexible financing through SDRs, rechanneling. MDBs also considering undertaking local currency lending to cushion against foreign currency risks and credit rating support. So also enhancing support to national public development banks to strengthen their ability to provide long-term local financing. And where they do not exist and sovereigns are willing to maybe establish some, that is also some support that can be given to the sovereigns as they can help in attracting local financing for public investments. Another issue is ensuring debt sustainability and credit assessments which are more accurate, objective and focused on the long term, because that affects the cost of financing if it is not properly done. Also, last but not least, is advancing progress on debt crisis prevention mechanisms. strengthened frameworks for debt restructuring, improved liquidity provision facilities and reforms of the debt sustainability analysis and building capacity in this area, as well as more coordinated engagements with credit rating facilities. We need to also take note that in debt restructuring, usually also there is the rating which leads to downgrades. So taking cushion that in the restructuring there is no downgrade, so that again the sovereigns will access credit at higher rates. Thank you so much.

Thank you very much, Ms. Azuna, and also for you being very, very concrete with your suggestions. Then I turn to our final panelist, Mr. Jose Correia, Director General for Economic and Development Cooperation of Cabo Verde. You have the floor, sir.

Thank you, Madam Moderator. It's a pleasure for us to be here. Now, we've been hearing a lot about debt and that debt is a liability, but debt is an important asset. Debt is not the end itself. Debt is a means to solve problems. I think we need to solve problems. We are talking, we are preparing for FF54, we are preparing to solve our problems. So when you think about debt, you're thinking about what problems you really want to solve. Is sustainable development? Is it employment? Is it creating an environment for private sector to develop? Is it infrastructure development? So we think debt, it's important to have debt. We also support a good management of debt. But we shouldn't stick on debt itself. We have to think debt as a mean to end. The end is sustainable development. I come from a country, Cabo Verde, a SIDS, Small Island Developing State. During the COVID, we reached debt to GDP ratio about 145%. My colleague from Ministry of Finance that is here. and knows better than me. But that was challenging for us when you reach that ratio. But we really solved a lot of problems that time. Many people had their lives saved because of that. So now we are around, thanks to good management of my colleague here, around 100% of GDP. But we think that Managing debt, we've been very strict in managing debt. And when you manage well your debt, we should be recognized by that. Because we are managing it well for sustainable development. And we think that the countries with good debt management should be supported in their sustainable development endeavor. Looking at FFG4, we propose that the need of compelling and evidence-based global debt architecture to be more development and resilience oriented. I think United Nations has already approved the MVI as an important tool, but there are other resilience indicators resilience indicators that are important to this end. But we also look at FFD4 to be an important opportunity for strong commitment on debt swap for sustainable development. Debt swap for sustainable development is not only debt for climate change. It's not only debt for-- it's a debt. in that whole debt to promote sustainable development. So those are two concrete proposals that we have for this chapter. FFD4 to have compelling evidence based on global debt architecture to be more development and resilience oriented and also commitments on debt swap for sustainable development. Thank you.

Thank you very much, also you for being very, very concrete. Now we have invited one discussant, who is Mr. Gian Piero Leoncini, who is the executive vice president of the Development Bank of Latin America and the Caribbean, to share reflections on the guiding questions and the comments by our panel. And you, sir, have three minutes for your intervention. You have the floor.

Thank you, Madam Chair. CAF, Development Bank of Latin America and the Caribbean, is honored to bring the voice of NDBs to this discussion on the future of international financial architecture. As a multilateral development bank with a strong presence in middle and upper middle income countries, many of which face high debt burdens and tighter fiscal space, CAF operates under a distinct reality from triple-A rated institutions, and yet our mandate is no less ambitious. We must do more with less, and that means being agile, competitive, and responsive to the specific needs of our member countries and markets. To remain relevant and impactful, MDBs like CAF are working actively on multiple fronts. First, we work like a cooperative. We are a South-South financial institution built on trust, shared ownership, and strategic solidarity. This model is at the heart of our success. Even though the weighted average credit rating of our loan portfolio is double B, Our institutional rating reaches double A thanks to the recognition of our preferred creditor treatment, robust governance, and strong liquidity position. This allows us to access capital at reasonable rates and pass those advantages onto our countries. But we don't stop there. We also operate a compensatory mechanism that uses part of our annual profits to offer more competitive margins to our shareholder countries. It's a practical expression of solidarity. We are also incorporating post clauses that allow for temporary debt relief in the event of climate disasters or macroeconomic stress. Secondly, blended finance and concessionality. While we are not concessional lenders by design, we are leveraging blended finance to de-risk projects and crowding private capital in strategic sectors from green infrastructure to regional industrialization, especially where traditional financing is scarce or cost prohibitive. Thirdly, Local currency financing. A key lesson from recent crisis is the vulnerability that comes from excessive dependence on foreign currency debt. We are expanding our capacity to lend on structured projects in local currencies, responding to the rate requests from our member states and contributing to more resilient public finances. Fourth and final, governance for the global south. We bring a unique perspective as a bank governed by and for the global south. Our governance structure gives voice and ownership to our shareholder countries represented by the ministers of finance, which allows us to tailor solutions more closely to local realities and align with development goals that reflect the priorities. To continue doing this work, we need a global financial architecture that recognizes the diversity of MDB models and supports institutions like CAF in scaling up resources, lowering capital costs, and unlocking long-term investment in sustainable development. Thank you.

Thank you very much for your very rich comments. Now it's time to open the floor. You know what to do. Press the microphone button. Two minutes and microphones are automatically cut off. I will start by giving the floor to Angola on behalf of the African group. Um, to be followed by Palau, who I assume is speaking on behalf of AOSIS, and he's nodding, so Angola, you have the floor.

Thank you, uh, Madam co-facilitator, always a challenge to address in two minutes, so I have the honor to deliver these remarks on behalf of the African group. The group is encouraged to see some positive proposals in the first revised draft, including the initiation of an intergovernmental process at the UN with the view to closing gaps in debt architecture and on standardizing the state contingent debt clauses during crisis. We also acknowledge the proposal in the draft to enhance the G20 common framework for debt treatment. However, we would like to see stronger language on reforming the framework with the aim of rendering it more efficient, transparent and time bound, incorporating the suspension of debt service upon application for debt treatment, the adoption of integrated approach among official and private creditors alongside multilateral and bilateral debt restructuring and refining tools for enforcing comparability of treatment to reduce technical disputes and accelerate restructuring. The group looks forward to strengthening the language regarding the initiation of intergovernmental process at the UN by adding the establish of a global debt authority as possible outcome to be explored. Along with the multilateral sovereign debt workout mechanism and specific in time a timeline of initiating such a process. The group stresses the sovereignty external debt distress can can continue to handle through current ad hoc mechanisms along particularly given the growing complexity of that landscape. The group also encouraged to see proposals on enhancing debt sustainability assessments on possible approach to deal with credit rating agencies assessments and hope to see these aspects strengthening and well reflected in the outcome document. I thank you.

I thank the distinguished representative of Angola and now give the floor to the representative of Palau to be followed by the representative of Ethiopia. Palau, you have the floor.

Thank you, Madam Co-Chair. I have the honor to deliver these remarks on behalf of the Alliance of Small Island States, AOSIS. SIDS find themselves in a dire debt distress, locked in a vicious debt cycle where precious limited resources are diverted to recovery and rebuilding from climate related shocks and disasters, often relying on expensive borrowing at higher interest rates. It is a debt we accumulate on behalf of others. This vicious debt cycle makes it exceedingly difficult 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 development potential. The gaps are clear, a development-oriented debt architecture is urgently needed. While debt swaps are useful, they are not the universal cure to the debt issues in developing countries. Therefore, the current proposals before us are not too ambitious or difficult to implement. They're all part of a suite of options that are required to aggressively address the debt challenges facing our countries. The Debt Sustainability Support Service is one such tool that aims to directly respond to these challenges. It is a tool built by SIDS for SIDS, rooted in our experiences, responsive to our needs, and flexible enough to adapt as new risks emerge. AOSIS's proposal for an international convention on sovereign debt is another practical proposal, one that has been called for decades, offering a structured, fair, and predictable framework for resolving sovereign debt crises, paving the way for debt workout mechanisms. For SIDS, such an instrument could be transformative, as Multilateral sovereign debt workout mechanisms grounded in international law are not just technical fixes, it is a matter of global justice. Thank you.

Thank you, Palau. I now give the floor to the representative of Ethiopia to be followed by the representative of Pakistan. So Ethiopia, you have the floor.

I thank you, Madam moderator. The consecutive informal consultations on the FFED for outcome document have provided a crucial opportunity to first real test drive of the outcome document. As the FFED4 process rapidly evolves, it is critical that the outcome document moves beyond producing a carefully negotiated text and instead focus on clear actionable targets with political commitments, responsibilities, and follow-up mechanisms. Ethiopia welcomes the initiation of an intergovernmental process that is particularly aimed at narrowing key differences in the debt architecture and on standardizing state contingent debt closed during the crisis. It is also crucially important to consolidate the language regarding the initiation of an intergovernmental process at UN by adding the establishment of the global debt authority. Ethiopia also recognizes the role of a rule-based approach to orderly, fairly transparent and transparent and durable debt crisis resolution in a process convening all creditors. While Ethiopia acknowledges the language in the draft to enhance the G20 common framework for debt treatment, we would like to see stronger language on accelerating and reforming the framework with the aim of making the process more efficient, transparent and time bounded. Furthermore, we emphasize the need to realize the sustainability while ensuring efficiency, fairness, predictability, and coordinated, timely, and orderly restructuring.

I thank you, Madam Moderator.

Thank you very much. I then give the floor to the representative of Pakistan to be followed by Bangladesh, and the list of speakers is now closed because it's very long. Pakistan, please.

Thank you, facilitators. I hope you don't only hear an echo chamber of developing countries in this interactive discussion. Preventing debt crises would be ideal, but the fact is there are events we cannot predict, the COVID-19 pandemic, climate change-induced disasters, disruptions in supply chains, and et cetera. So these crises do occur. Sometimes they're out of the control of developing countries, and we need to find a solution for them. In this context, for us, the two key proposals which are most meaningful in the document is paragraph 43E, the call for a UN intergovernmental process for closing gaps in the debt architecture, and 42B on the call for systemizing liquidity and liability management support, such as to the World Bank debt reduction facility. Current debt mechanisms are inefficient, slow, do not lead to equitable outcomes, and the fact is, that developing countries do not have an equal say in decision making on how such mechanisms should be improved. A new debt mechanism should be predictable, it should be inclusive, it should be transparent, it should be neutral, it needs to be hosted in an impartial institution, and its decisions should be legally enforceable. An annual dialogue on debt or a debtors club is not an adequate landing zone or substitute for an intergovernmental process on debt at the UN. And, um, on credit rating agencies, I think the only issue cannot be that developing countries are not sharing their data accurately with them, I think we do need more nuanced methodologies and we think the outcome document has, um, excellent proposals on that. Lastly, it would be interesting to know whether the proposal for utilising the debt reduction facility to provide coordinated and enhanced liquidity and liability management support to developing countries is considered a feasible outcome, because we think it could be a very important deliverable. We would like to hear more feedback on that.

Thank you very much, Pakistan. I then give the floor to the representative of Bangladesh, to be followed by the representative of Colombia. Bangladesh, please.

Thank you, Chair. We support the commitment in the outcome document to include state contingent clauses for both official and commercial lending. These clauses recognize country-specific context, reduce default risk, and free up essential resources for emergency response during crisis. We cannot become complacent just by stating that we will consider expanding the eligibility of debt sustainability support services to LDCs. The operationalization and expansion of the DSSI for LDCs is a must. Many LDCs face debt sustainability challenges, and this mechanism can provide critical support tailored to our unique vulnerabilities. At the same time, it is imperative to provide assistance to debtor countries to enhance debt management capacity, manage risks, and analyze trade-offs between different sources of financing. We also call upon exploring innovative debt instruments, including debt forgiveness linked to climate resilience and climate adaptation investments. We have to ensure a comprehensive reform of sovereign debt credit rating practices as promised in the text, promoting fairness, transparency, and inclusion of long-term development prospects. Vulnerability to external shocks, climate, and social indicators will help reduce unjust borrowing costs. Debt sustainability assessments must be refined to better account for sustainable development spending and climate investment rates. Overemphasizing fiscal consolidation and austerity penalizes much needed investments in human capital, infrastructure, and climate resilience. We must redesign the methodologies to support, not stifle, sustainable development. Finally, this outcome document must strive to build a future where debt becomes a vehicle for development and empowerment, not a burden and liability. I thank you.

I thank the representative of Bangladesh and now give the floor to the representative of Colombia to be followed by the representative of Cuba. Colombia, please.

Thank you, Your Excellency. On the key constraints to scale up debt swaps, We need to first lower the cost of transactions. Second, simplify the process by providing both technical support to developing countries and also developing term sheets, not with the purpose of standardizing these instruments, but to avoid the developing countries start from scratch when it comes to designing them. So also lowering the time to develop them. Third, we need to create incentives to creditors and what do we mean by that, to connect very clearly what are the contributions of the debt swap with the specific nationally defined targets on sustainable development, such as, for example, the NDCs. First, we need to create better transparency mechanism and also ensure that credit rating agencies engage constructively with these operations since developing countries should not be downgraded when they are trying to mobilize innovative financing precisely to protect global public goods. Then on the need to create a more development oriented debt architecture, we need to ensure that climate and nature risks are integrated in debt sustainability analysis. And there is the need for the IMF and for the World Bank to take into account the recommendations of the independent expert review on debt, nature and climate, an initiative that has been supported by Colombia, Kenya, Germany and France, and that has also been endorsed during the negotiations by the like-minded group of countries for middle income countries. Thank you.

Thank you, Colombia. I now give the floor to the representative of Cuba, to be followed by the representative of Costa Rica.

Cuba, you have the floor. include the urgency of addressing the debt burden faced by developing countries, it is further worrisome that it has overlooked the proposal to begin a UN intergovernmental process to establish an international convention that includes, among other initiatives, a multilateral mechanism for the negotiation of sovereign debt. Since there is not a permanent singular institutional framework for coordination between creditors and debtors, the current management of sovereign debt is fragmented and unbalanced. To that end, we are alarmed by references in the document to the protagonistic role of the IMF and the World Bank in addressing the sovereign debt of developing countries. It is inconsistent and therefore not It is difficult to understand these references to the same institutions that have led and implemented the very systems that led to the debt crisis. These institutions and their initiatives have not addressed the root causes of sovereign indebtedness and have historically conveyed to the debtor country the same levels of conditionality that have perpetuated and, in many cases, and the indebtedness situation. To move towards a truly development-oriented debt architecture, we need to create a fair, transparent and binding mechanism to restructure sovereign debt.

Thank you very much to Cuba. I now give the floor to the representative of Costa Rica, to be followed by the representative of Tunisia.

But Costa Rica, please.

Thank you, Madam Coepers-De Tejada. Middle-income countries face a unique combination of structural vulnerabilities added to high external debt that mean that they need responsible public policies to reduce the indebtedness and also to ensure that they are sustainable. The challenge of sustainability of debt is one of the biggest challenges that we face because we are not only seeking to grow economically but also achieve sustainable multi-dimensional development. Therefore, we need to have access to international financing on favourable conditions. Therefore, we welcome the fact that the document includes key proposals proposed by the group of like-minded middle-income countries. Firstly, we welcome the call to review fiscal rule methodologies with the aim of enabling sustainable long term investments, lowering the cost of capital and more fairly distributing risks between creditors and debtors. We also support the use of new debt instruments such as green bonds and debt for development or debt for nature schemes. These tools allow us to align fiscal sustainability with environmental and social sustainability. We also believe that investments from countries in their nat- natural or environmental capital should… be measured and considered when determining the conditions for international loans. Finally, we reiterate our support to the proposal for establishing a multilateral framework for resolving sovereign debt crises with more effective, equitable and predictable mechanisms in line with the Pact for the Future and the mandate of the Secretary General. These proposals are essential to ensure that middle-income countries do not fall into cycles of unsustainable debt so that they are able to free up resources to advance with greater ambition towards sustainable development. Thank you.

Thank you very much. I now give the floor to the representative of Tunisia to be followed by the representative of Honduras.

Thank you, Madam co-facilitator. Tunisia acknowledges the critical importance of achieving and maintaining debt sustainability as a cornerstone for fostering economic growth, ensuring social stability and meeting the needs of its citizens. Given the challenging macroeconomic environment, Tunisia debt has risen significantly over the past decade, largely driven by financing needs to support public investment, address socioeconomic challenges, and respond to external shocks and global inflation. Debt sustainability for Tunisia requires a comprehensive strategy that focuses not only on prudent borrowing practices, but also on enhancing domestic resource mobilization, improving fiscal discipline, and fostering robust economic growth. Tunisia is committed to implementing reforms that will strengthen its debt management framework, ensuring that borrowing remains within manageable limits and that debt servicing does not further burden essential public spending in areas such as education, health and infrastructure. In this context, Tunisia is collaborating with the UN Economic and Social Commission for Western Asia, ESCWA, on the Climate SDGs Debt Swap Initiative. This program aims to alleviate Tunisia's debt burden while channeling resources into sustainable development and climate adaptation projects. However, debt sustainability is not just about the quantity of debt, but also about its quality. Tunisia is focused on ensuring that borrowed funds are allocated efficiently, prioritizing investment that will generate long-term economic revenue. This approach is critical to creating the conditions for a self-sustaining economy that can face challenges without over-relying on external debt. In summary, Tunisia is committed to a balanced and responsible approach to debt management and one that ensures current obligations are met while positioning the country for sustainable.

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

Thank you, Madam co-facilitator. In this section, the delegation of Honduras would like to underscore the following. Number one, developing countries face strict conditions in terms of accessing credit, which are imposed on public investment programmes. in development and mean that they have to decide whether or not they pay more or they have to invest in their people. Secondly, we continue to see per capita income criteria for access to funding ignoring vulnerability to climate change and the lack of this broad realistic type of criteria does not allow us to fully understand vulnerabilities and does not provide adequate responses to the needs of developing countries. The high levels of high costs of transactions without any inclusion of assistance in legal and financial advice reduces their availability. Developed countries control decision-making bodies within multilateral institutions. This means that they impose priorities that are not aligned with the needs of countries of the global south. Five, Credit rating agencies unfairly penalize developing countries, which means that it drives up their cost of debt, making it difficult to measure, to carry out debt swaps, et cetera. Likewise, there is unequal treatment for countries that have limitations in debt eradication, to debt eradication or elimination. We therefore think that action should be taken with developing countries that are not currently eligible for such funding. Thank you.

Thank you very much, Honduras. I now give the floor to the representative of Indonesia, to be followed by the representative of the United Republic of Tanzania. Indonesia, you have the floor.

Thank you, Madam co-facilitator. Indonesia strongly supports our collective commitment to advancing debt sustainability as reflected in the current draft. We would like to share a few key inputs. First, we observe that the proposed reform of the common framework remains largely aspirational without clear commitments to make it genuinely faster, more authentic, and truly inclusive. Furthermore, the current reliance on voluntary debt service suspension during restructuring negotiation risk continuing to strain debtor countries precisely at the moment when fiscal space is most critically needed. Nevertheless, Indonesia underscore its strong support for the common framework for debt treatments as important platform for coordinated and equitable debt restructuring. Second, on innovative instruments, Indonesia warmly welcomes the ongoing discussion on solutions such as debt for nature, debt for climate swaps. As one of the world's most biodiverse country and among those highly vulnerable to climate change, Indonesia recognize the transformative potential of this instrument in aligning financial stability with climate and development objective. Lastly, regarding credit assessment, as outlined in paragraph 48A, we call for urgent reform to the credit rating agency, the following actions shall be considered, first, reforming rating methodologies to better account for the growth potential of developing countries and to reflect the positive impact of the recovery. of investment in sustainable development. Two, promoting greater transparency and accountability in credit assessment, including through the establishment of internationally agreed standard and oversight mechanism to address bias and ensure fairness in evaluation of sovereign creditworthiness. Three, encouraging development of alternative credit assessment mechanism, including regional and multilateral public rating platform to diversify sources of credit.

I thank the representative of Indonesia. I now give the floor to the representative of United Republic of Tanzania, to be followed by the representative of Iceland.

Thank you, Madam Chair.

Many developing countries struggle with high debt

payments and expensive borrowing, which limit their ability to fund essential development goals like SDGs. current debt relief effort are too slow, small, and disorganized.

And in Tanzania, we believe to fix this, we need more affordable loans for less development

cuts, better coordinated system, new tool like debt swap for climate or development that align with the national plan. These tools need clear technical help and donor support to work at the scale.

Support should be made according to each country needs based on long-term development plan, not just a short-term finance. Regional banks and UN agencies should be helped to create solution. We need a new global debt framework that is fair, clear, and give debtor country a strong voice.

Let's shift just managing debt crisis to creating debt strategy.

that should be sustainable development.

Tanzania believes FFD4 in Seville must commit to a better debt system management for the future.

Thank you, Madam Chair.

I thank the representative of the United Republic of Tanzania and now give the floor to the representative of Iceland to be followed by Ms Patricia Miranda representing Latinidad and Civil Society FFD Mechanism. Iceland, you have the floor.

Thank you, Madam co-facilitator. On the topic of debt and cost of borrowing, it is important that debt is a strong tool for development and not an obstacle, as was well underlined by Mr. Correa.

We would like to stress the importance of technical assistance and capacity building. Strong debt management units and sound regulatory environments are important not only for increasing the resilience of economies, but also for creating favorable investment conditions that are necessary to attract private capital. The linkages between debt and domestic resource mobilization are clear. To the point made by Mr. Stevens, enhanced domestic resource mobilization through progressive pro-poor fiscal

systems is vital to increase government revenue

and enable governments to robustly manage their debt.

Increased transparency and communication on debt in the context of restructuring is vital to ensure speed,

efficiency, and to limit negative spillovers on fiscal space and credit ratings.

The same goes for innovative solutions like debt swaps,

bearing in mind the point made by Mrs. Huhne on the potentially prohibitively complex legal requirements.

Technical assistance is integral in this regard as well. In closing, it is important that the FFD outcome document further builds on existing solutions, such as the G20 Common

Framework, and accelerates the ongoing work to improve their effectiveness and timeliness.

Existing solutions are not static entities, and it is in our hands to work together to improve them, to make them more fit for purpose, to deliver the development outcomes needed. Thank you.

I thank the representative of Iceland and now give the floor to the representative of Latinad, civil society FFD mechanism, Ms Patricia Miranda. You have the floor, Madam.

Thank you, thank you, Ms Co facilitator. Debt is a financing for development resource. But it depends on its conditions and under the current no system of debt with ad hoc processes that have proven are not fit for purpose for prevention and restructuring, that hardly fulfills that objective. We are extremely concerned by governments whose position seem intent on blocking any significant reform of debt architecture, protecting a status quo of the IMF, World Bank and G20 troika in which creditor governments hold the decision making power. If they succeed, they will condemn millions of people to decades of austerity, stagnation and human and environmental rights violation caused by unsustainable debt. Debt crisis cannot be resolved with a growing spiral of debt. There is a systemic failure that needs to be recognized. The debt status quo, which has led to repeated debt crisis over the past years, is built on the legacy of colonialism and imperialism by the global north in the global south. In this sense, we strongly support the following proposal in paragraph 10 of the global financial framework section. We acknowledge that it is an imperative for developed countries enriched through the colonial action to pay the financial debt to these countries that have suffered the impacts of colonialism by which an international scheme must be created for the countries to claim and monitor the just payment. On debt swaps, even if they finally manage to include principles of integrity, they have limitations in terms of scale and impacts. Debt swaps cannot be the main game changer proposal on debt in FFD4. We need an intergovernmental process at the United Nations with a view to closing gaps in the debt architecture. We call on all member states to register their support for these key proposals in the next intercessional and ensure a strong outcome document on debt. Thank you.

I thank the representative of Latin Dad, and I'm stealing some, a few minutes from the next panel in order to hear first the representative of the African Development Bank. Then I would like to give the floor to the representative of GK Partners Social Enterprises, Professor Jibrail Fal. And finally, one minute to each of the panelists to answer any questions or comments. But African Development Bank, you have the floor, two minutes.

Thank you very much. Excellencies, distinguished delegates, ladies and gentlemen, it's a pleasure to join you today for this critical discussion. Africa faces a debt and cost of capital paradox. In 2024, our countries spent $74 billion servicing debt, more than quadruple what we spent in 2010. And over half of this went to private creditors, and that service now absorbs nearly a third of government revenues. These are not just numbers. These are trade off between interest payments and schools, between bond markets and hospitals. And we need a very robust domestic resource mobilization framework for countries to adequately source their financing. We need to develop functioning and deep local currency capital markets to among other shield countries against FX volatility that could increase their debt service by 30% as it has happened and more as it has happened in the past. The African Development Bank Group is taking bold action to address this. We've launched a multidimensional debt action plan to strengthen fiscal forecasting, and support borrower-led restructurings. And we're working with countries and MDBs to design inclusive framework where borrowers shape the process, not just react to it. We're also leading efforts to lower the cost of capital, endorsing the G20 proposed cost of capital commission and are preparing a study to inform the work of this commission. And finally, we are innovating. The bank launched the first sustainable hybrid capital instrument by an MDB and together with the Inter-American Development Bank, we have built an IMF compliant mechanism to channel SDRs as hybrid capital to MDBs, multiplying their impact up to four times, eight times, without increasing debt. So MDB debt is provided at a cost that is very far below what countries, what emerging market countries can achieve on their own. A very good step towards debt sustainability, effectively replacing

I thank the representative of the African Development Bank and now give the floor to Professor Jibrail Fall, GK Partners Social Enterprises, who represents the business community. You have the floor, sir.

It would be most remarkable if one was to have a financial architecture that excludes a country's biggest source of foreign currency. and one of the most effective sources of funding for SDGs at household and community levels. Alas, that is indeed the current situation, as the hundreds of billions of self-help diaspora finance are excluded from the financing for development structures. In 2024, formal, informal, and in-kind remittances to sub-Saharan Africa was about $100 billion, and diaspora savings not sent to Africa was about $30 billion. Imagine if the huge amounts of countercyclical remittance flows to LLDCs are used routinely for derisking and to improve sovereign creditworthiness. Imagine if the most, if the almost certain future flows are securitized for innovative funding structures. Imagine if parts of ODA are used for remittance might funding with the new funds endowed as legacy funds. This is what the AU backed remit aid program proposes. Imagine Chair, if Domestic resource mobilization through local currency instruments are routinely put on regulated fintech platforms accessible to the diaspora. We do not have to imagine no more. FFD4 at Seville can commit the world to this new and inclusive future of development finance. Thank you.

Thank you, Professor. We are over time, but I would like to give our distinguished panelists one minute each for final reflections. So should we start in the same order? Mr. Phil Stevens from the UK.

Thank you. Fascinating conversation to listen to. I'm conscious that a lot of the interventions have come from the global south, and I suppose I just want to close by reiterating that actually dealing with solvency crises as quickly as possible to restore debt sustainability and preventing liquidity crises or shocks becoming solvency crises. is frankly as much in the interest of creditors like the UK, like the private sector, as it is in the interest of developing countries. And I think that's why I'm confident that we can build on some of the ideas we've had today, some of what's already in the outcome document, and reach a really strong set of propositions in the final outcome document. Thank you.

Thank you very much. Ms. Monica Asuna from the National Treasury of Kenya.

Yeah, thank you and thanks for the comments. What we know is that we are just four years to 2030 to realise the SDGs, and also what is coming out is that most bilateral partners right now are scaling down on ODA, and then domestic resource mobilisation is not adequate. So what do we need? Low cost financing, either from multilaterals or in the international capital markets, to bridge the budget deficits within sovereigns to be able to realise the SDGs. Thank you.

Thank you very much. The final word goes to Mr. Jose Carreira from Cabo Verde.

Thank you for leaving me to be the last one. I think a few takeaways we have the consensus that there's a need of the reform of the credit rating agencies to be more inclusive and more multidimensional. And also to have a better debt system, a debt architecture that to be more development and resilience oriented. And the last one is concerning debt swap. We think it's important to-- it's a new tool that we still have to develop, but it's a tool that provides good solutions for the problems that we have. Thank you.

So dear friends, I really welcome this thought-provoking discussion that has provided us with much to reflect on. I really thank the distinguished presenters for their insights, as well as all delegations that got to speak for their contributions. And I do apologize to all those that had signed up to speak that I haven't given the floor due to the time constraint, but it was a long list of speakers. We will now briefly pause. You sit, we move and rearrange the podium, so thank you.

Thank you.

I think.

Hello, hello, good afternoon. How are you doing, my friend?

Play all songs of the story. Yes, you.

Excellencies, distinguished delegates and participants, we shall now begin the discussions on science, technology, innovation and capacity building. I am pleased to welcome our distinguished panelists. for this discussion. Excellencies, distinguished delegates, on behalf of my co-facilitators, Ambassador Alicia, it is my pleasure to moderate this panel discussion on science, technology, innovation and capacity building. Science, technology and innovations are advancing at an unprecedented scale and pace. However, Leveraging its full potential for advancing sustainable development is constrained by deepening technological gaps, inadequate digital infrastructure and digital public goods, limited national capacity, and insufficient international support. Unregulated technological advances can also have unintended economic, environmental, and social consequences, and worsen gender inequality. Coordinated national and international efforts are needed to address these challenges. The STI chapter has three areas of actions. First, actions to realize the full potential of STI in supporting sustainable development, including through strengthening innovations, technology transfer, knowledge sharing, capacity building, financing for SDI and international cooperation. Second, actions to increase investment in resilient digital public infrastructure and digital public goods and close the digital divide. And third, the actions to leverage digital financial services. Panelists in this session are invited to pay particular attention to actions on the links and impacts of the artificial intelligence on the fintech. I invite the panelists to respond to the following guiding questions. First, how can the Icosoc FFD forum and related processes best support inclusive, multistakeholder dialogues on the intersections of technology, including artificial intelligence, fintech, and sustainable development, particularly in ensuring no one is left behind in the digital transitions. That is actions 54C. As AI-driven financial technologies evolve rapidly across different regions, are there Are there sector common values, safeguards or benchmarks that should guide their deployment and use to ensure they contribute to inclusive and sustainable development outcomes? And how can such guiding frameworks best be shaped through inclusive and representative global processes? That is actions 54D. We shall now hear presentations by our distinguished panelists. I would kindly remind our panelists to be concise and concrete in your interventions. You will have four minutes for your intervention, and I invite you to speak specifically to the first draft of the outcome document and how you want to strengthen the actions for a strong outcome in Seville. I now give the floor to Mr. Ahmad Salman Zaki, Director at the Ministry of Foreign Affairs of Maldives. Floor is yours.

Thank you very much, Ambassador, distinguished co-facilitators, ladies and gentlemen. We all know that SDI is a key enabler of sustainable development. Investing in SDI can bridge technological gaps and ensure equitable access to digital goods. It can even provide new impetus to economies, especially for developing countries, small island developing states like mine, the Maldives, which has limited natural resources. It can increase our productive capacities, which gives our economies greater space to grow. But it can also be a double-edged sword. It holds the potential for transformative potential to achieve the SDGs, but it can also deepen inequalities. This is mainly due to disparities in access to technology and digital infrastructure. AI and fintech are reshaping economies, but developing countries continue to face challenges. And I'd like to make three points. First, international cooperation is essential to facilitate technology transfer, knowledge sharing, and capacity building, but targeted support is crucial. Without targeted support, inequalities could deepen financial and digital divides. AI-enabled fintech can increase financial inclusion for dispersed populations and improve efficiency. In my country, the Maldives, we've embarked on a digital transformation journey, specifically on providing greater financial services to geographically dispersed populations. We're tracking coastline erosion with real-time satellite imagery, so there's a lot of good in it. But we must also be conscious of the fact that safeguards are needed. There must be a set of global common norms and values that we all agree to because without that we're leaving -- we can't aspire to leave no one behind. We're not just talking about leaving countries behind, but within our own national standards we must ensure that marginalized communities, the elderly, are not left behind at all. And how we address this is to ensure that the underrepresented have a voice in global decision making tables, whether it's in the multiple advisory boards, in the different international organizations, and other forums as well. Second, multifaceted challenges like this require multi-stakeholder solutions. Over the last two days in the Ecosoc Forum on Financing for Development, we all heard from a variety of sources, from people from different backgrounds, representing different interests. And this is good because we tend to get stuck in our own echo chamber a lot of the time. So we see the FFD Forum as an effective platform to exchange ideas, knowledge, and technical know-how. Similarly, I'm happy to be on a multi-stakeholder panel. To my right is Lois from MasterCard. I know there's a lot you can also do to help countries like mine, so let there be concrete outcomes from these collaborations. Similarly, what we want to see is investing in youth and young people to drive SDI. They're the custodians of the future. They have the biggest stake. So we need international cooperation to bring them to the table, listen to their voices, and secure a sustainable and prosperous future. Third, strengthening state capacity is important. This means giving countries, helping countries enable their own policies, take ownership of their development pathways and not depend on external assessments. Data collection and statistics are crucial for policy making, we all know that, but a lot of developing countries lack the regulatory frameworks and the capacity to gather and analyze meaningful data. And it's not just about managing data, but it's about managing it well. And that's what we should aspire to. AI models trained on insufficient and biased data can only serve to deepen inequalities. And this is why we ask to strengthen state capacity. So just to sum up my points. Leaving no one behind means listening to the underrepresented, making sure they have a seat at the table. Multi-stakeholder collaboration and solutions can lead to progress, and we must strengthen state capacity and invest in data. Thank you very much.

I thank Director Mr. Zaki for his comprehensive presentations. And now I give the floor to Ms. Louise Brew, Vice President of the Humanitarian and Development Team, is the Mastercard.

Good afternoon, your excellencies and my co-presenters. It's a pleasure to be with you this afternoon. I was delighted to see that multi-stakeholder collaboration was on the agenda for today because I really think that is a path to addressing a lot of the issues at the intersection of technology and sustainable development. We all know that technology innovations tend to happen in silos, and with that we'll never be able to build on the successes that each individual initiative is having. Instead, we need a coordinated approach to innovation and sustainable development with each sector doing what they do best. So having the government focus on regulations that protect its citizens and regulate the markets, having NGOs go where the government doesn't go, have the private sector do innovation and scaling, and have the philanthropic sector go where the private sector doesn't go and do de-risking, which is a very important role in that. Mastercard approaches sustainable tech, sustainable technological development through the building of ecosystems. And we build technological ecosystems as well as partnership ecosystems. So let me just take a moment on each of those. For technology ecosystems, We have built a, much the way we did for our core business in the banking sector, we have built a technology platform for rural communities in developing countries to connect the agriculture ecosystem. So smallholder farmers, connect them with the cooperatives they work with, connect them with lenders who can give them credit, connect them with input providers who can give them quality seed and fertilizer to increase their inputs. And what this results in is farmers being able to digitize their transactions on this digital marketplace. So now bankers have visibility to the kinds of sales they're having, the kind of income they have. They become digitally visible for the first time and digitally included for the first time and are able to qualify for credit. They also have access to quality seed and fertilizers to improve their yields and access to buyers so that they can get increased prices. This is our technology approach to sustainable development and to ecosystem building. Our partner approach to ecosystem building is something that we started a year ago. It's called the MADE Alliance, Mobilizing Access to the Digital Economy. We are co-chairing this alliance with the African Development Bank and MasterCard, and the goal of the MADE Alliance is to provide critical digital services to 100 million individuals and businesses in Africa by 2034, a very ambitious goal. But the approach to getting there is actually quite simple. The approach is for multi-sector stakeholders to coordinate their efforts into the same communities. So rather than Mastercard working in County A and another a bank working in County B and a government working in County C, let's all work in the same places and stack and layer our initiatives on top of each other. And I'm happy to report about we're at our one year anniversary come May. We have four live initiatives where we have multiple MAID partners working together. And I'll give you an example of one that's live now. Microsoft offers connectivity to rural communities in Africa. Mastercard has a digital platform that provides the services I just described to farmers. Now that connectivity is coming into the cooperatives where Mastercard's farmer customers use our digital services, and they can bring a diseased leaf from their crops and see what's happening. As part of that alliance, we work with the Kenya National Farmers Federation, who organize the farmers in the last mile and help them with digital upskilling so they know how to use the internet. So here we have three MAID Alliance partners collaborating in the same villages. We're doing this in a proof of concept in 12 villages in Kenya right now. And based on the outcome of this initiative, we'll look at how we scale that further into Kenya and into other countries. So my recommendation to this forum is to formalize ways of multi-sector stakeholders of working together so we can drive towards concrete outcomes and amplify each other's results in the places that we work. Thank you.

I thank Ms. Lewis-Bru for her interventions and insightful presentations. And now I give the floor to Ms. International Trade Union Confederation. And.

Thank you. Distinguished delegates, thank you for the opportunity to address this important panel on STI. Today, I'd like to emphasize three critical aspects of the STI agenda from a trade union perspective. First, the digital economy has grown rapidly, transforming industries while exacerbating decent work deficits. Allow me to use the platform economy as a striking example. Millions of people worldwide now depend on digital platforms for their income, from food delivery couriers to ride hailing drivers and content moderators. Yet these workers are often denied their basic rights and protections. Platform companies promote flexibility and independence, but the reality is different. Algorithmic management through surge pricing and pickup bonuses creates precarious working conditions. Workers encounter unique occupational risks, safety risks, sorry. The WHO and ILO found approximately 750,000 workers worldwide die yearly from long working hours, a figure exacerbated by the poor conditions of platform work. More directly on related to fintech, workers often bear the costs for equipment and social insurance, and accordingly, they face predatory financing schemes promoted as financial innovations. As we consider how to mobilize private capital and leverage the private sector, we must ensure that our system has the right standards and enforces the right mechanisms for workers to have access to decent jobs with living wages and without falling into cycles of indebtedness. So the ILO governing body will discuss decent work in the platform economy at its 113th session in June, and the ITC is campaigning for global rules to protect platform workers. We are advocating for a binding ILO convention backed by a recommendation to establish fair standards worldwide. Platform work is but one example of the challenges of digital transformation. As AI-driven technologies evolve, international standards and protections become even more critical to ensure that innovation doesn't come at the expense of human dignity. Second, and broadening a little bit here, but it's crucial, the global trading system must be reformed to prioritize social and climate justice. This includes embedding labor standards in the WTO and utilizing the ILO supervisory system to assess compliance with labor standards in international trade. Again, here technology transfer is important to benefit developing countries, especially in the context of just transition. So to promote green pathways and low-carbon supply chains, we must put in place special provisions to ensure developing countries benefit from the climate transition. And that also means an ambitious TRIPS waiver that expands intellectual property exceptions beyond COVID-19 vaccines to cover technologies needed for the green transition and digitalization. Third, for financial technologies to be fair and inclusive, we must first build foundational digital systems that leave no one behind, as mentioned by my fellow panelists from the Maldives. This means democratic, gender-responsive digital architectures that ensure privacy and individual control over personal data, with regulations that reduce gender, nationality, and class biases through social dialogue and collective bargaining. We also need robust measures safeguarding citizens' digital rights regarding the digitalization of public services, including regulations on the commercialization of personal data and digital identities. Universal access to equality in internet and fair digitalization policies that ensure labor and union rights for all workers in the digital economy. And we need investment in gender responsive strategies for skills development and lifelong learning that address women's structural barriers to accessing education and jobs in the digital and STEM economy. So to conclude, to best support inclusive dialogues on STI and sustainable development, our multilateral system must remain vigilant, Member states should commit to maximizing technology's potential to create decent and sustainable jobs that support environmental sustainability and poverty eradication. Finally, references to AI should be aligned with human and labor rights principles in line with the global digital compact as well as with the ILO Centenary Declaration on the Future of Work. Thank you for your attention.

I thank Ms. Diallo for her presentations and excellencies distinguished participants. And now we are going to have the interactive discussions for this. Now I hand over the floor to our fellow co-facilitator, Madam Ambassador Alicia to conduct the sessions. Thank you.

Thank you very much, Ambassador. And now I open the floor for comments or for questions regarding the presentations we have just heard. Delegations wishing to request the floor should indicate their intention by pressing the button on the microphone console. And before giving the floor to the first speaker, I kindly request delegations to observe the time limit of two minutes. for interventions. We reserve the right to adjust time limits as necessary in case of a long list of speakers. And to ensure proper interpretation, delegations are asked to speak at a normal pace and to provide a written copy of their statements to e-statements@un.org at least two hours in advance of delivery. 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. And with this, I would like to give the floor to the distinguished representative of Uruguay, followed by the distinguished representative of Singapore. Uruguay, you have the floor.

Thank you very much, Ambassador. We're living in an era of unprecedented technological and scientific progress where even nonetheless we see how emerging technologies continue to be focused and for the scaling up of sustainable technological solutions. Uruguay has supported an inclusive vision of innovation. We have developed a robust digital infrastructure. Our education system includes access to technology from early childhood and we have an ecosystem that coordinates the state, academia and the private sector. We believe that the outcome document from Seville should create instruments for science and innovation focusing on knowledge transfer and technical cooperation for developing countries that would allow us to mitigate the digital divide, including the gender gap, thus harnessing capacity building to make headway in achieving the SDGs. We firmly believe that the digital transformation is not only a technological matter but is also political and ethical in nature. We cannot allow technology to advance without regulation, furthering territorial gender or even economic inequalities. The FFD forum must and can be a space to align this with the needs of the most vulnerable groups, including young people, children, older persons and persons with disabilities. I wish to reiterate Eurochoice's commitment to this process with the co facilitators of the document and with the host of the conference reaffirming its relevance for multilateralism and to make progress in achieving Thank you very much. I thank the distinguished representative of Uruguay.

I give the floor to the distinguished representative of Singapore, speaking on behalf of the G77 and China, to be followed by the distinguished representative of Bangladesh.

Thank you very much, Madam Ambassador. I have the honor to deliver the statement on behalf of the Group of 77 and China. For the group, SDI is an accelerant for achieving sustainable development, enabling us to promote greater inclusivity, equity, and facilitate the easier exchange of innovation and best practices. However, at the same time, unfettered and concentrated technological and digital advances or transitions and the emergence of new technologies pose the risk of leaving some countries and people behind, if not properly undergirded by robust international cooperation, governance, and support for developing countries to enhance investment in foster institutional capacity building and develop local ecosystems, including through technology transfer to developing countries. Specifically with regard to the guiding questions and action 54C, the group believes that the ECOSOC FFD forum can be a platform to support the intersectionality between technology, science, digital technologies, including new and emerging ones, by profiling positive and successful test cases in countries and at the regional and international levels to facilitate better knowledge exchange. This includes identifying context specific implementation challenges for developing countries and the requisite international support they require, whether this be in access to technology, targeted sectoral investments or policy and infrastructure design. This must go hand in hand with using the FFD forum as well as the SDG investment fair as opportunities to crowd in investment, uh, and financing for projects. We should not limit ourselves to rhetorically extolling the benefits of SDI but yield tangible cooperation. On new and emerging technologies such as AI, we note that sometimes developing countries are excluded from international dialogues on governance and norm setting, and it is imperative that our perspectives and contributions are taken into consideration. Madam co-facilitator, the group is of the view that this section presents a real opportunity.

I thank the distinguished representative of Singapore speaking on behalf of the G77 and China and Bangladesh, you have the floor followed by Costa Rica and then by China, Bangladesh please.

Thank you, Chair. We welcome the call to operationalize the online university for LDCs and the commitment to strengthen the UN Technology Bank for LDCs. We also support the emphasis on national STI for SDG roadmaps, we urge that these be backed by dedicated, predictable and concessional finance, especially for LDCs and countries in special situations. We underscore the importance of affordability and local adoption, adaptation of, for the development of digital public infrastructure and goods. We call for the co-creation of digital public goods with developing countries, including open source software in local languages, accessible design, and low bandwidth applications. We welcome the call to promote equitable access to artificial intelligence. Developing countries must not be passive adopters of global AI norms, rather participate as equal contributors to shaping them. For this, An AI capacity fund for developing countries and LDCs could help build regulatory capacity, data governance systems, and AI research hubs across Africa, Asia, and LDC regions. We suggest a mechanism for monitoring digital development, a scorecard or index measuring equitable access to STI, digital rights, and digital finance in developing countries. Without measuring the gaps, we cannot close the digital divide. We support the draft's recognition of the role of intellectual property rights and TRIPS flexibilities. In line with this, we urge to adopt a development-friendly IP protocol to expedite technology transfer in key development sectors such as clean energy, health and agriculture. Finally, FFD must ensure that technology serves development and not the other way around only. Thank you.

I thank the distinguished representative of Bangladesh, and I now give the floor to the distinguished representative of Costa Rica, followed by China and then Timor-Leste. Costa Rica, you have the floor.

Thank you, Madam Chair. Costa Rica welcomes the strengthening of the language in the section on science, technology and innovation, particularly the renewed emphasis on equity, inclusion and international cooperation as guiding principles. We welcome the incorporation of capacity building in STEM, technical training, academic exchanges, innovation challenges and bridging the digital divide. We also value the explicit recognition of the need to promote regulatory environments that favor innovation, especially in digital financial services and emerging technologies, with ethical safeguards, data protection, and a focus on rural inclusion. Costa Rica has advocated for integrating into this process clear references to the responsible use of digital technologies, including artificial intelligence, as well as funding for research and technological development, elements that are now reflected in the document. We also reaffirm the importance of reducing technological asymmetries at the global level, ensuring open access to knowledge and promoting scientific cooperation among developing countries. Thank you. I thank the distinguished representative of Costa Rica.

I would like to give the floor to the distinguished representative of China, followed by Timor-Leste, Ecuador and India. China, you have the floor.

Thank you, Madam facilitator.

China associates itself with the statement made by Singapore on behalf of G77 and China. STI is an important engine for sustainable development.

In recent years, the rapid development of AI and other emerging technologies had a profound impact on economic and social development of all countries. However, most developing countries have not yet been able

to fully access, utilize, and benefit from AI, and the global digital divide is still widening.

China believes that the chapter on STI in the outcome document of the FD4 should emphasize the following. First, practice multilateralism and jointly create an open, inclusive, universal, and non-discriminatory environment for STI developments opposed small yards with high fences and decoupling so AI and other scientific and technological achievements could benefit all countries and all people. Second, to prioritize development and put people at the center, encourage the international community to increase financial, technological and capacity building support for developing countries, promote STI to empower sustainable development goals, help eliminate poverty and hunger and address challenges such as climate change. Thirdly, to improve the global governance of AI and other emerging technologies, advocates fairness, universality, security, and collaborative governance, supporting UN in playing its role as the main channel in implementing the GA resolution on international cooperation and capacity building for AI and the global digital compact, and enhance the representation and voice of developing countries in governance. I thank you.

I thank the distinguished representative of China, and I now give the floor to the distinguished representative of Timor-Leste, followed by Ecuador, India, and Tanzania. Timor-Leste, you have the floor.

Thank you, Madam Ambassador. My delegation aligns itself with the statement delivered by Singapore on behalf of G77 and China. Allow me to highlight I like the following points in my national capacity. Small island development states, seats and least developed countries, LDCs, face unique economic and environmental challenges requiring sustainable and inclusive financial mechanism to unlock their potential for growth and resilience. The digital divide remains a significant obstacle for more seas and LDC limiting their access to science, and innovations, SDI, which are crucial for economic growth and sustainable development, many seats and LDCs face challenges such as, as limit internet infrastructure. high cost for digital access, inadequate technological educations and disparities in digital literacy. These issues prevent businesses, educational institutions and government from fully harnessing the benefits of SDI to drive economic progress. With the sustainable development goals, SDGs of track and financial challenges mounting addressing the digital divide at FFD4 is essential to ensure that SEEDS and LDC can fully participate in the digital economy. By tackling these challenges, SEEDS and LDC can unlock new opportunities for growth in the digital finance, e-commerce, telemedicine, and smart agriculture, allowing them to accelerate their economic development and build more resilient societies. Therefore, the forthcoming FFD4 will serve as a beacon of hope for these developing countries. STI and capacity building are essential pillar in saving financial for development, offering transformative opportunities for.

I thank the distinguished representative of Timor-Leste and I now give the floor to

the distinguished representative of Ecuador,

India and then Tanzania. Ecuador, you have the floor.

Thank you, Madam Chair. Ecuador agrees with the position of developing countries in the assessment that technology increases productivity and efficiency, reducing costs and facilitating access to international markets. Digital technologies such as e-trade platforms, e-trade and fintech, et cetera, helps particularly SMEs to participate in value chains. Technology transfer, capacity building and investment in infrastructure, in digital infrastructure, are all essential to reducing the digital divide. Furthermore, Ecuador also recognizes that the increasing number of trade restrictions are also hampering the situation, particularly for countries in the global south. Both national and international efforts can play a key role in mitigating these risks through coordinated and sustainable action. Technological fragmentation could be heightened if we do not guarantee fair transfer of technology. Through cooperation funds, we can facilitate access to green technology for productive sectors, particularly for MSMEs. multilateral institutions have a strategic supporting role to play to promote inclusive growth that can include establishing a system for cooperation that can develop standards ensuring growth within countries, foster cooperation to ensure technology transfer and access through agreements and trade partnerships, as well as support for investment with the establishment of special trade provisions and incentives. Institutions can also gear their efforts towards...

Microphone's been cut off. I thank the distinguished representative of Ecuador.

I give the floor to the distinguished representative of India, followed by Tanzania and Yemen. India, you have the floor.

Thank you, Chair. The transformative power of science, technology, and innovation is critical to addressing the challenges faced by developing countries, particularly technological gaps, limited capacity, and barriers to research, development, and technology adoption. Digital public infrastructure and the responsible use of emerging technologies can strengthen financial inclusion, narrow the digital divide, and promote economic growth. Strengthening international cooperation is essential to foster an inclusive and non-discriminatory digital transformation that supports sustainable development. This includes sharing best practices, exchanging policy experiences, facilitating technology transfer, including artificial intelligence from developed to developing countries, and supporting capacity building efforts. India's active engagement in global STI initiatives, such as the Technology Facilitation Mechanism, highlights our commitment to collaborative progress. The ECOSOC FFD Forum can play a vital role in supporting inclusive, multi-stakeholder dialogues on the intersection of technology and sustainable development. We welcome efforts to convene stakeholders to share experiences and promote coherent cross-sectoral policy and regulatory frameworks while avoiding siloed approaches to digital finance governance. We also support exploring global principles to guide safe, inclusive and equitable use of AI in financial technologies. Such frameworks can help ensure that AI contributes meaningfully to resilient, inclusive, and sustainable development. Lastly, we emphasize the importance of democratizing technology by promoting digital literacy, vocational skills, and equitable access, ensuring that no one is left behind in the digital.

I thank the distinguished representative of India and I now give the floor to the distinguished representative of the Republic of Tanzania, followed by Germany.

Thank you, Madam Chair.

STI hold potential for accelerating progress toward the SDGs. However, this potential is often undermined by limited national capacities. Developing countries like Tanzania are increasing embracing AI technology, not as a replacement for human resources, but as a tool.

To support and uplift more people, especially women, youth, and marginalized communities. This ensures that the digital transition leaves no one behind.

As AI-driven financial technologies expand rapidly, common values and safeguards are urgently needed to guide their development. We propose three foundational principles, equity, transparency, and accountability. Sector-specific benchmarks such as ethical AI standard for credit scoring and consumer protection in digital lending are essential.

This should be developed.

Through inclusive global process supported in the UN system and informed by regional diverse evidence and innovation ecosystem. Investment in resilient digital public infrastructure and open digital public goods must also be prioritized, particularly for developing countries.

Let's severely launch a bold call to democratize technology. Thank you.

I thank you. And I now give the floor to the distinguished representative of Germany. followed by representatives of civil society. Yemen, you have the floor.

Thank you, Madam co-facilitator. Yemen appreciates the opportunity to contribute to this important discussion. Despite significant challenges in bridging the digital divide, we have made notable progress in digitizing our economy through mobile money systems that have proven critical for humanitarian response. Our digital payment initiatives have successfully facilitated salaries, cash transfer, and cash for work trade facilities. And programs reaching millions of vulnerable Yemenis. However, we have sig- uh, we have faced, uh, significant obstacles in scaling this success. Yemen have been systematically excluded from accessing, uh, certain multilateral funds and technological support due to political motivation restrictions. by member countries of these funds. When technological solutions are politicized, it is the most vulnerable population who suffer. We call for three priorities in the FFD for outcome document. First, debilitizing access to digital technologies and financial systems. Technology transfer should be based on human needs, not political considerations. Second, develop inclusive governance framework for emerging technologies that consider the unique challenges of conflict affected countries. Third, creating dedicated funding mechanism for digital infrastructure in conflict-affected countries, including resources for cybersecurity and digital literacy. Yemen joins other developing nations in calling for a multilateral approach that ensures all countries, regardless of political circumstances, can benefit from digital transformation to achieve the SDGs. Thank you.

I thank the distinguished representative of Yemen, and I would like to give the floor to civil society. The first one is Stakeholder Group on Persons with Disabilities and Society for International Development. And I give the floor to Mr. Matthew Kelson. You have the floor.

Thank you, Chair. In closing the digital divide, we must ensure gender equality and disability inclusion, specifically inclusive digital infrastructure and accessible procurement for marginalized groups. International collaboration and initiatives on digital infrastructure financing should be inclusive, transparent, and publicly accountable. In strengthening technology transfer, knowledge sharing, and capacity, we must promote South-South sharing in STI, enable and support local innovations that respond to the actual needs of people. utilize local capacities and sustainably use resources and support development of endogenous technologies, particularly in developing countries and LDCs. Chair, it is critical to actively engage all stakeholders, including civil society and data collection and policy development to support driving technological innovation. We must leverage citizen-generated data to enhance transparency and promote human rights-based approaches and inclusion and accessibility in science, technology, digital transformation, and innovation. Finally, Chair, we must enhance collaboration among the STI Forum and other international platforms. This includes the establishment of an inclusive, transparent, participatory global mechanism at the UN for the evaluation of new and emerging technologies, inter alia, artificial intelligence, as well as their actual and potential impacts on society, including on marginalized groups such as persons with disabilities. I thank you very much, Chair.

I thank Mr. Matthew Kelson, speaking on behalf of the Group of Persons with Disabilities and Society for International Development. And I now give the floor to the last request for the floor to Ms. Anita Thomas from Virginia Gildersleeve International Fund and NGO Committee on FFD. So Anita Thomas, you have the floor.

Thank you, Chair. I speak on behalf of Virginia Gildersleeve International Fund and the NGO Committee on FFD. We welcome the strong language in the outcome document emphasizing the role of science, technology, and innovation in achieving the SDGs, especially the commitments to inclusive capacity building, particularly for youth, women, and marginalized groups, and the launch of the online university for LDCs. These are vital steps towards bridging digital divides. We commend the focus on equitable access to AI and the efforts to build inclusive ethical regulatory systems, however, a critical gap remains, the energy demands of large scale AI models risk deepening climate vulnerabilities and straining fragile infrastructure, particularly in developing countries, AI development must become more sustainable and aligned with climate goals. In section 54C, we recommend enhanced regulatory oversight to address risks such as algorithmic bias, including in financial product development, data insecurity, and discrimination. This includes establishing global ethical standards for AI that prioritizes fairness, transparency, and privacy throughout its lifecycle. Second, improving data quality, including disaggregated data, ensuring robust data protection and cybersecurity, and holding both public and private actors accountable to reduce bias and safeguard human rights. In section 54D, we call for strong investment in AI and digital literacy, especially for the unbanked and digitally excluded. This includes expanding financial and digital literacy to ensure safe use of AI-driven services. Second, building the technical and regulatory capacity of national oversight bodies and consumer rights organization. And lastly, promoting partnership across government, civil society, and the private sector to scale and inclusive sustainable AI solutions. Thank you, Chair.

I thank Ms. Anita Thomas speaking on behalf of Virginia Gildersleeve International Fund and NGO Committee on FFD. And I would like to come back now to our distinguished panelists for a final comment. So we will start with Mr. Ahmed Salman Saki, Director of the Ministry of Foreign Affairs of Maldives. You have the floor.

Thank you very much, Ambassador. Thank you for all your perspectives and views on the topic of SDI and capacity building. For me, there are a few clear messages that have come out. First is that AI and FinTech are not just technological and digital transformations, they're sociopolitical choices. If guided by ethical, inclusive, and accountable principles, they can be engines for growth, prosperity, and resilience. But if left unchecked, they can only further deepen the inequalities we seek to bridge. Second is that developing countries must have a seat at the table. They must not just be passive recipients of the SDI agenda. Rather, they should be active shapers of the SDI agenda going forward. And finally, colleagues, multilateralism is in need of a win, a desperate win. I think all of us in this room know this. The trust in the system is eroding, so which is why concrete outcomes at the FfD4 conference is even more important than ever. Investment and progress on SDI will continue, but it is up to us through multilateral cooperation, through solidarity to ensure that the progress is equitable and grounded in justice. Thank you very much.

Thank you very much, Mr. Zaki. And I would like to give the floor to Ms. Loa Bru, Vice President of the Humanitarian and Development Team at Mastercard. Please, you have the floor.

Thank you all for your comments today. The recurring themes of capacity building, the need for finance to make sure that we produce equitable results in developing countries came through loud and clear. And I just want to reiterate my call to cooperate across sectors, private sector, public sector, civil sector, and formalize our engagements so that we multiply our impact where we can work together. Thank you.

Thank you very much. And finally, Ms. from the International Trade Union Confederation. Please, you have the floor.

Thank you. So one of the messages that comes out is that we really need to make sure that the digital and technological innovations don't short circuit our international standards and values. And that means that we need to have multilateral coherence and we need to embed human and labor rights in our international institutions. And here the connection to trade is particularly important to ensure that we prioritize social and climate justice. Again, bringing to the point that was made on the floor about, for example, transfer of technology. We must also keep pace with the technology to design and implement policies and regulations that govern technology, data, and algorithms that are employment and worker friendly while ensuring privacy and individuals' control over their own data. And we must also address gender, nationality, disability, class biases. I will leave it there, and thank you very much.

Ms. Diallo, thank you very, very much. And with these excellencies, ladies and gentlemen, I welcome the stimulating discussion that provided us with numerous reflections. I thank the distinguished presenters for their insights, as well as all delegations for their contributions. The Preparatory Committee will meet tomorrow at 10:00 a.m. in this chamber and will hold panel discussions four and five. The program and other information for the meetings of the FFD4 PrepCom are available on the eGov portal, eGov.un.org. And I want to thank you all for your participation. And the meeting is adjourned. Thank you.