FINANCING DEVELOPMENT AND SOCIAL PROTECTION IN DEVELOPING COUNTRIES
Delegations should make the Global Summit on Financing for Development (FFD4) 2025 a Success
The process to prepare for the fourth International Conference on Financing for Development next June 2025 in Seville, Spain is entering an important stage. However, it does not seem that there are enough opportunities for substantive discussions of policy matters and so the conference could end up without any new agreements to celebrate. This note thus proposes a way to organize such discussions and who might organize them in order to make the Summit a success.
Download the full paper here >>>
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An International Tax on Crypto Trading to finance Social Protection during Emergencies
A new paper proposes a small global tax on crypto trading with proceeds sent to a global pool of funds to disburse as grants to developing countries confronting economic or physical catastrophes to supplement national funding of social protection. The proposal takes advantage of G20 "roadmap" to bring all crypto trading onto regulated platforms. It builds on the concept in India's existing crypto trading tax.
Mobilizing public resources to help vulnerable people get through threatening challenges is a universal principle. International support in times of crisis is also a widely accepted principle, as in environmental and public health catastrophes, international financial crises or other emergencies. International financial cooperation during the COVID-19 pandemic was a case in point, although it was insufficient in amount and most of the assistance took the form of loans, adding to the debt burden of many already heavily-indebted governments (UN, 2022).
Additional international support during emergencies should be evident, but unmet emergency food aid needs grew by 23% in 2023 and only 35% of the international funding formally requested for hunger relief globally was provided (Action Against Hunger, 2024).
A better approach is to raise more domestic and international tax revenue. Trading in crypto assets—including purchases and sales of crypto “coins” using conventional fiat money or investment in non-fungible tokens (NFTs) and other crypto-denominated assets—will increasing fall into the sights of tax collectors, as the international “Roadmap on Crypto Assets” is implemented. The Roadmap is contained in a Synthesis Paper that the Group of 20 (G20) requested the International Monetary Fund (IMF) and the Financial Stability board (FSB) prepare (IMF and FSB, 2023).
This paper proposes that to better meet global emergency needs, a common, modest transaction tax should be collected from all registered crypto trading platforms, which are increasingly falling into the sights of tax authorities around the world. A multilateral initiative would share the transaction tax revenues collected with cash-strapped developing country social protection systems during emergencies.
See and download paper here >>>
Entwicklungsfinanzierung in Zeiten multipler Krisen
Nach ersten Erfolgen der Umsetzung der 17 UN Entwicklungsziele (SDGs) führen die Folgen des Klimawandels, die Auswirkungen von Corona, der Krieg in der Ukraine, Lebensmittel- und Energiekrise, die Unterbrechung von Lieferketten und Lieferengpässe sowie Inflation und weltweit gestiegene Zinssätze wieder zu einem Anstieg von Armut. Allein im Jahr 2022 hat die Zahl der Menschen, die in extremer Armut leben, um 11 Mio. zugenommen. Nach Prognosen der Weltbank werden im Jahr 2030 noch 574 Millionen Menschen in extremer Armut leben, also mit weniger als 2,15 Dollar pro Tag auskommen müssen. Die Chancen für das Erreichen der Entwicklungsziele sind gering.
Etwas Hoffnung bringt der Beschluss der Generalversammlung der Vereinten Nationen im Dez. 2023 zur Einberufung einer 4. Internationalen Konferenz über Entwicklungsfinanzierung (FfD4) im Jahr 2025, an der Regierungsvertreter, Internationale Finanzinstitutionen, Business und Zivilgesellschaft gemeinsam nach Lösungen suchen sollen. In einem herausfordernden wirtschafts- und geopolitischen Umfeld werden hohe Erwartungen an die Konferenz gestellt. Einerseits sollen Mittel und Wege gefunden werden, zusätzliche Gelder zu mobilisieren, um die gewaltige Finanzierungslücken bei Klima und Entwicklung zumindest signifikant zu reduzieren. Andererseits soll FfD4 auch ein Meilenstein für die Reform der internationalen Institutionen sein, also dazu beitragen, die internationale Finanz- und Handelsarchitektur fit für die Herausforderungen der Gegenwart und Zukunft zu machen. Spanien erklärte sich bereit zusammen mit Mexiko, die Konferenz als Gastgeber zu organisieren. Der Weltgipfel selbst soll im Sommer 2025 in Madrid/Spanien stattfinden. Mit der ersten Sitzung des Organisationskomitees am 23. Februar 2024 im UN-Hauptquartier in New York ist der Vorbereitungsprozess in seine heiße Phase gegangen.
Zugleich bemühen sich die G20 inBrasilien (2024) und in Südafrika (2025) um konsensfähige Lösungen aus den multiplen Krisen. Siehe die G20 Website der brasilianischen Präsidentschaft hier >>>
In einem Briefing Paper geben Bodo Ellmers und Wolfgang Obenland einen Überblick über den Financing for Development-Prozess, die Herausforderungen für die 4. Weltkonferenz zur Entwicklungsfinanzierung, die Themen der anstehenden Verhandlungen sowie mögliche bzw. wünschenswerte Ergebnisse.
Siehe Website des Briefings hier >>>
Orientierungspapier der Evangelischen Kirche in Deutschland (EKD): "Auf dem Weg zu einem nachhaltigen und gerechten Finanzsystem". Eine evangelische Orientierung für Reformschritte zur sozial-ökologischen Transformation der Finanzwirtschaft: Siehe Website hier >>> und download das Papier hier >>>
Der Weltrat evangelischer Kirchen (ÖRK), der Lutherische Weltbund, Reformierter Weltbund und Weltmissionsrat starteten 2012 nach der großen Finanzkrise von 2008 einen Prozees zu "Wirtschaften für das Leben": "Economy of Life for all Now: An Ecumenical Action Plan for a New International Financial and Economic Architecture" (NIFEA):
Siehe Website hier >>>
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IMF's new Strategy for Engagement on Social Spending
review by Barry Herman
Four years have passed since the International Monetary Fund adopted a new Strategy for Engagement on Social Spending that was meant to increase the support that IMF gives to national policies on social protection, health and education. The Fund interprets this as instructing its staff to focus on the adequacy, efficiency and sustainability of social programs when they can affect macroeconomic conditions (are “macro-critical”) in member countries. The staff make their judgments during annual assessments of macroeconomic conditions in individual countries or when devising policy adjustment programs with countries that need to work toward recovery from macroeconomic crises. One way to assess how the new strategy is being implemented is to look for changes in IMF advice and the policy requirements for IMF loans. Results so far have not been encouraging, although it is still early. Another way is to examine the guidance that IMF gives its staff when they go on country missions. This paper takes the latter approach. While the IMF has not issued a formal guidance note to staff as of 2023, it has published two interim guidance papers that give insight into the strengths and weaknesses of IMF thinking on how to implement its strategy. This paper supports some aspects and takes issue with other aspects of the guidance thus far given.
See new comment on subsequent IMF note on health spending here >>>
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Discussion on the “IMF's strategy on social spending facing austerity: new direction or bandaid?”
Civil society organized a discussion with the IMF on the IMF's new policy on social spending. The event took place on 12th April at the Civil Society Policy Forum (CSPF) during the 2023 International Monetary Fund - World Bank Group Spring Meetings.
Civil society organizations expressed their concern that spending on social protection, health and education is still not given sufficient priority in government budgets. They fear conditionality in IMF country programs will continue to negatively impact essential social spending. Questions were discussed: how should IMF and other international agencies, labor movements and CSOs each work to enhance and protect national social spending programs? And, how might international cooperation be strengthened to assure more adequate, efficient, universal and sustainably financed social protection and social services in all countries.
The event was co-organized by the Global Coalition for Social Protection Floors (GCSPF), Bretton Woods Project, Human Rights Watch, International Trade Union Confederation (ITUC), Kvinna till Kvinna Foundation, NGO Committee on Financing for Development, Oxfam International, Social Justice in Global Development, Social Policy Initiative (South Africa).
Moderator was Alex Campbell, International Trade Union Confederation (ITUC)
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