EIB President discusses the role of public finance to address inequalities at UNCTAD

EIB President Werner Hoyer participated in the fifteenth session of the United Nations Conference on Trade and Development (UNCTAD), hosted by Barbados, to explore how policies and financial instruments can help build a more resilient and equal world.

The UNCTAD quadrennial ministerial conference brings together heads of state and government, ministers and representatives from the business world, civil society and academia to assess current trade and development issues and formulate global policy responses.

Werner Hoyer joined a dialogue with Mia Mottley, Prime Minister of Barbados, Carla Barnett, Secretary-General of the Caribbean Community, Michelle Bachelet, United Nations High Commissioner for Human Rights, and Gabriela Bucher, Executive Director of Oxfam International.

The discussion focused on ways to adapt production systems and public finance to address inequalities related to gender, income and access to technology, in developing countries and especially in Small Island Developing States.

In her introduction, Isabelle Durant, Deputy Secretary-General of UNCTAD, highlighted how the COVID-19 pandemic has a disproportionate impact on low-income and emerging economies and their people. She described how this threatens global development aspirations and increases a sense of injustice, with 32 million people left below poverty line and women and girls especially affected.

Michelle Bachelet called for greater international solidarity and an expansion of social expenditure. “Where high-income countries spend 28% of their GDP for recovery measures, this figure is only 1.8% for least developed countries”, she said.

President Hoyer outlined the EIB’s contribution to an inclusive global recovery in crucial areas such as climate, innovation and development, and called for more partnerships.

“Only if we manage to work together and succeed on the three fronts of climate, innovation and development, will we have a chance of transitioning towards a sustainable economic system, rapidly reducing greenhouse gas emissions, and achieving the UN Sustainable Development Goals. To do so, we must keep seeking new ways to increase our impact, in every area of economic development - but in particular with regard to climate action and combatting COVID-19. This is obviously a win-win situation, because so many of the challenges the world faces are truly global problems that we all need to confront together”.

President Hoyer emphasised the urgency to tackle climate change and global inequality, and congratulated the Caribbean and Pacific nations on their leadership in promoting decisive action on climate adaptation. Earlier in the discussion, Carla Barnett, the Secretary-General of the Caribbean Community called to “push COP26 to be decisive to achieve the goals of Paris agreement alive”. 

Mia Mottley, Prime Minister of Barbados thanked the EIB for supporting the Government of Barbados’ COVID-19 pandemic response and new healthcare investments through concessional framework 20 years loan, which is the kind of instruments needed to face the crisis.

Taking the example of the EIB’s collaboration with the Caribbean Community and the Community of Latin American and Caribbean States, Werner Hoyer said: “The European Union recognises the huge risks vulnerable populations face. We have been, and will remain a close partner to vulnerable countries and regions around the world. Besides our grant and loan assistance, we offer our expertise in creating financial products and ensuring the long-term sustainability of new investments.”

He added: “For the EIB, climate adaptation is about preparing for an uncertain future. The projects the EIB is financing are about making sure that when extreme events occur, like flooding, storms and droughts, people are protected and can continue living their lives in safety. Considering the challenges posed by climate change, we need to do more, and we need to do it faster. We need additional initiatives and projects in order to address the investment gap that vulnerable nations are facing. Public funding and traditional instruments such as grants will not be able to solve all the challenges”.

Finally, President Hoyer presented the EIB’s plans to increase its development impact. With €78 billion invested in countries outside the European Union over the last 10 years, the EIB intends to strengthen  local presence in coordination with the European Commission and Team Europe partners, to respond to the growing need for ever stronger global economic and trade ties.

About UNCTAD

The United Nations Conference on Trade and Development (UNCTAD) is a permanent organ of the United Nations General Assembly, established in 1964 to support developing countries to access the benefits of a globalized economy more fairly and effectively through trade, investment, finance, and technology.

Related links:

Caribbean Development Bank and EIB announce EUR 30m (USD 36m) in financing for affordable access to vaccines and new healthcare investments across the region

Barbados: The EIB contributes USD 60 million to the Government of Barbados’ national pandemic response

EIB activity in Latin America and the Caribbean in 2020