A Summit for a New Global Financing Pact will take place in Paris on June 22 and 23, with the Secretary-General of the United Nations present to advocate for a reform of the international financial system, which is not currently equipped to tackle present-day challenges.
According to Secretary-General António Guterres, “the global financial system, which manages around 300 trillion dollars in financial assets, is simply not fit for purpose.” He recently stated, “Today’s poly-crises are compounding shocks on developing countries – in large part because of an unfair global financial system that is short-term, crisis-prone, and that further exacerbates inequalities”
The aim of this Summit is to concurrently tackle the challenges of climate change, biodiversity protection, and the fight against inequality in order to achieve the Sustainable Development Goals (SDGs).
The Summit is co-organized by France and India, with the latter holding the presidency of the G20 this year. The Secretary-General of the United Nations will be in Paris for this occasion.
Also in attendance will be Olaf Scholz, Chancellor of Germany; Ursula Von der Leyen, President of the European Commission; and Mia Mottley, Prime Minister of Barbados. The latter leads the Bridgetown Initiative, aimed at facilitating access to international financing for countries most vulnerable to climate change.
The purpose of the Summit is to align various agendas (climate, development, debt) and propose innovative solutions to these challenges.
Reversal of Human Development
The summit is taking place in a unique international context: in 2022, the United Nations noted a reversal of human development in nine out of ten countries across the globe, primarily driven by a decrease in life expectancy and a rise in poverty. The COVID-19 pandemic and the conflict in Ukraine, along with their consequences, have indeed reduced the income of many countries, affecting their ability to finance their populations’ access to basic social services.
Countries in the Global South, which pollute less than the rest of the world, are the most threatened by the climate crisis. In 2022, natural disasters cost over $300 million, heavily weighing on their economies.
As a result, the ‘great financial divide’ continues to widen, leaving the countries in the Global South more sensitive to shocks. Developing countries lack the urgently needed resources to invest in recovery, climate action, and the Sustainable Development Goals, which puts them even further behind in the event of the next crisis – and even less likely to benefit from future transitions, including the green transition
Strengthen solidarity with the Global South
The Summit will focus on discussing various ways to enhance financial solidarity with countries in the Global South. Its main objectives include creating fiscal space, promoting private sector development, fostering green infrastructure investment, and generating innovative financing for countries vulnerable to climate change.
This Summit is one among numerous international events scheduled throughout the year, such as the G20, the SDG Summit, and COP28. These events are all designed to drive the achievement of tangible, impactful results.