UK pushes for a bigger, better and fairer international financial system

by MMC
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  • Foreign Minister announces programs at UN General Assembly to help achieve UN Sustainable Development Goals
  • The financing aims to improve the global financial system, including by making it easier for developing countries to access funds and invest in their own sustainable development.
  • James Cleverly will also announce new UK support for climate change preparedness and improving access to education around the world.

Foreign Secretary James Cleverly will today (Tuesday) outline the UK’s new action to build a more inclusive international financial system to improve life around the world to the United Nations General Assembly ( UNGA).

Climate change, the threat of pandemics and stagnant economic growth are among the greatest challenges facing the world’s most vulnerable and require a united global effort to address them. On his second day in New York, the Foreign Secretary will make clear that we must respond to these challenges through a strong and collective international system, while reaffirming the UK’s commitment to achieving the goals of sustainable development by 2030.

Unlocking more finance from international financial institutions and the private sector will be essential if we are to achieve these goals and the UK is already playing a key role in mobilizing private investment, improving global tax systems and preparing to tackling climate change – including through UK policy. recent A commitment of 2 billion dollars to the Green Climate Fund.

The UK announces commitments and reforms that will unlock billions of pounds of global funding and help developing countries invest in their futures to promote the Sustainable Development Goals.

As government representatives from around the world gather for the Sustainable Development Goals Summit, the Minister of Foreign Affairs will announce new financial guarantees for multilateral development banks to help our overseas aid go further far and to multiply our impact by unlocking more affordable loans.

Through one of these guarantees, the UK will help unlock up to $1.8 billion in climate finance to help at-risk populations in Asia and the Pacific adapt to the impacts of climate change and to increase their resilience to natural disasters. This will help accelerate their transition from fossil fuels to low-carbon energy sources, demonstrating how sustainable economic growth and development can go hand in hand.

The Foreign Secretary will also announce a further guarantee to provide urgent investment in quality education to tackle the global learning crisis.

New UK support will unlock up to $1 billion in new funding for education in lower-middle-income countries in Asia and Africa, where an estimated seven in ten children are unable to read a simple story before the age of 10. for Education (IFFEd) will help increase schooling for the poorest and most marginalized children. It will enable countries to use education as a tool for sustainable development and focus on improving literacy, numeracy and social skills, including through teacher training and curriculum development.

Foreign Secretary James Cleverly said:

The additional financing needed to achieve the Sustainable Development Goals is estimated at around $4 trillion per year. We urgently need bold global action to build a bigger, better and fairer international financial system that helps close this gap.

The UK has been instrumental in setting the targets and we are committed to achieving them by 2030. With our international partners, we are going faster and further to change the international financial system and ensure that no one not be left behind. The voices of the poorest and most vulnerable countries must be heard at the heart of the multilateral system.

The UK is also leading the way in making the global financial system more responsive to shocks. For example, the UK was the first to offer climate resilient debt clauses in our Export Credit Agency loans, suspending repayments in the event of a natural disaster or pandemic. Faced with growing global challenges, the Foreign Minister calls for this to become the rule, not the exception, to allow affected countries to focus on recovery.

As part of our commitment to tackling climate change, the UK will also provide additional support for disaster risk financing in the Caribbean, a region particularly vulnerable to natural disasters. The Foreign Secretary will announce that the UK will join the CCRIF SPC (formerly the Caribbean Catastrophe Risk Insurance Facility), the Inter-American Development Bank, the Caribbean Development Bank and the Coca Cola Foundation to establish an affordable insurance scheme aimed at to increase the resilience of vital water. and sanitation services. This will enable rapid payments to fund repairs following hurricanes and floods, restoring access to clean water and preventing the spread of disease.

Ensuring that countries have sustainable public finances is essential to achieving the Sustainable Development Goals. With adequate support to strengthen domestic taxation and close gaps, low-income countries could collectively raise an additional $260 billion. But we also need a fairer system in which existing global commitments on international taxation are fully respected, so that the most vulnerable countries do not lose the revenue they should receive. The Foreign Secretary will announce a new £17m UK funding package to improve developing countries’ tax systems so they can stop revenue leakages and invest in their sustainable development.

The UK is also committing £3 million to support increased use of standards in Commonwealth countries, helping to reduce trade barriers, increase economic stability and reduce reliance on aid, opening up opportunities for international businesses, including those in the UK.

Further information

The Minister of Foreign Affairs announced today:

  • The UK is offering a guarantee of up to $300 million to the Innovative Climate Finance Facility for Asia and the Pacific (IFCAP). We estimate this will unlock between $1.2 billion and $1.8 billion in additional climate finance over the next 5 years, meaning a return approximately 4-6 times that of our guarantee commitment. The Innovative Climate Finance Facility in Asia and the Pacific (IFCAP) is a multi-donor financial partnership mechanism established by the Asian Development Bank (ADB) to increase financing for accelerated action against climate change in Asia and the Pacific. Peaceful.

  • The UK will contribute £180 million to the International Finance Facility for Education (IFFEd). This includes up to £95 million in grants and paid-up capital, as well as a conditional guarantee of up to £85 million. IFFEd will unlock up to $1 billion in affordable funding for education, with the amount available subject to final confirmation of support from other donors, alongside Sweden and the United Kingdom. As more donors join IFFEd, this amount will increase.

  • The UK will provide the Caribbean Water Utilities Insurance Collective (CWUIC) with a repayable investment of $25 million to help Caribbean water and sanitation companies access affordable insurance.

  • New UK funding of £17 million to improve tax systems in developing countries

  • A total of £3 million to support the increased use of standards in Commonwealth countries. The funding will be used for workshops and training, technical assistance, information exchange and toolkits to support the implementation of international standards between Commonwealth countries.

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