Financing international development

What is the forthcoming international conference about?

John Langmore

In this paper, I want, firstly, to tell the story of the International Conference on Finance for Development to be held in Monterrey, Mexico, in March 2002, including some remarks on the reasons for its organisation by the United Nations. Secondly, I want to discuss a few of the issues that are on the conference agenda:

  • domestic sources of finance and, in that context, the importance of improving international co-operation about domestic tax matters and considering new and innovative sources of funding;

  • official development assistance;

  • global public goods; and,

  • global economic and social governance.

The international community has begun to focus on the growing ‑ and increasingly explosive ‑ inequities globalisation entails. At the major international United Nations conferences of the 1990s, such as the World Summit for Social Development, proposals for a more balanced and equitable approach to development were articulated and agreed by world political leaders. The Millennium Declaration of 8 September 2000 articulates clear goals and a framework for action. The conference on Financing for Development offers an unprecedented opportunity for further advances.

The decision of the General Assembly in December 1997 to convene a "summit, international conference, special session of the General Assembly or other appropriate high‑level intergovernmental forum on financing for development" was a breakthrough.1 Developing countries had been proposing a conference on financial issues for many years. Amongst the reasons noted in the resolution were the continuous decline of official development assistance and the need to "explore ways of generating new public and private resources to complement development efforts ...".2

The reasons for the US withdrawing its opposition to the proposal are not clear to me. It was said at the time that the growth of foreign direct investment in developing countries had led to the expectation that private capital flows could provide the external financial resources needed by most developing countries. One can assume that the proposal for a conference on financial issues must have been more difficult to resist after the Asian financial crisis. Moreover, the realities of the global economic and social situation were also clearly powerful factors. These factors include the following. 1. Global interdependence is growing strongly. 2. After half a century of uneven but often rapid and widespread economic gro