STATEMENT BY DR. ARJUN KARKI, INTERNATIONAL CO-ORDINATOR, AT THE SIDE EVENT ON ENHANCING ODA FOR LDCS’ DEVELOPMENT AND TRANSFORMATION, DEVELOPMENT COOPERATION FORUM

UN HEADQUARTERS, NEW YORK, 30 JUNE 2010

Mr Chairman, Excellencies, ladies and gentlemen,

I would like to thank the organisers for giving me the opportunity to speak on behalf of LDC Watch. As you are aware, LDC Watch has been leading the mobilisation and consolidation of LDC civil society inputs towards its interventions at the Fourth UN Conference on LDCs (LDC IV) in 2011, aiming to produce a pro-poor next-generation LDC development agenda together with all stakeholders in this process.

Today, the fragile situation of the LDCs is being further worsened by unfolding multiple crises related to climate change, the global economic meltdown, food crisis, energy crisis and debt crisis, amongst others. These crises further intensify the multiple structural hindrances that LDCs face in addition to their inherent geographical constraints and environmental vulnerabilities. Today, more than 800 million of the world’s citizens are facing these conditions. Clearly, the achievement of the Millennium Development Goals (MDGs) in LDCs is one of the greatest challenges for humanity. LDC Watch is, therefore, campaigning and advocating for NO MDGs without LDCs!

Official Development Assistance (ODA) for LDCs is specifically included in MDG 8 - Global Partnerships for Development, Target 8b – Addressing the special needs of the LDCs. The MDG Gap Taskforce Report 2009 states, “although total ODA flows to the LDCs have risen from 0.05 per cent of the GNI of DAC countries in 2001 to 0.09 per cent in 2007, it remains hugely short of the target of 0.15-0.20 per cent contained in the Brussels Programme'. The development partner countries have thus failed to keep their promises with the BPoA deadline ending in 2010. Ironically, billion of dollars are being poured into restoring the market-driven global economy at the expense of ODA cuts to the poorest and most vulnerable citizens who are already deprived of basic social living conditions and sustainable livelihoods, further jeopardised by the existing pro-market development paradigm. UNDP 2008 Report ‘Making Globalization Work for the Least Developed Countries’ rightly notes that “at the international level, it is important to look beyond further trade liberalization to strengthening the capacity and performance of LDCs in a sustainable manner and ensuring effective market access”.

Only Botswana and Cape Verde have so far graduated from the LDC category and the number of LDCs has doubled since the category was defined in 1971. One of the main reasons behind the proliferation of LDCs has been the lack of resource mobilization, or insufficient mobilization. While mobilizing resources, we must make sure that the mobilization is demand driven, based on the needs and demands of the poor and the vulnerable communities in LDCs. It is imperative that development aid make use of country systems and promote country ownership, as advanced by the Paris Declaration and the Accra Agenda for Action (AAA).

Champions of ODA and Financing for Development (FfD) often overlook the issues of human rights and gender justice. Economic growth masks ongoing inequalities. Decline in the extreme poverty rate, coupled with increasing income inequality is presenting LDCs with a ‘to cheer or not to cheer’ situation. There is also a need to increase per capita disbursement of aid. Per capita spending on basic social services like health and education remains low in a number of LDCs and development assistance needs to target these areas directly for maximum impact. Lack of transparency and aid predictability has made it difficult for LDCs to plan effectively for the long run. Victory over issues like poverty, malnutrition, and lack of infrastructure take a long time to achieve and may not be immediately visible.

While reviewing the progress made on the Millennium Declaration at the High Level Plenary in September 2010, progress and setbacks made on the MDGs in the LDCs need to be assessed separately. This is because while the situation in other developing countries may be improving, conditions in LDCs are likely to deteriorate in this decade. Further, we need to break down national data by specific populations - to look at the progress of marginalised groups and not just overall progress. We also need to find ways to measure progress in human rights and gender justice in the LDCs to accompany the social and economic progress reflected in the MDGs.

One issue that needs considerably more attention, in our view, is that of ‘energy poverty’. Above 1.5 billion people of the world, almost a quarter of the global population, live in darkness without electricity, and 80% of them are in the LDCs (UNDP/WHO, 2009). According to the UNDP/WHO 2009 report, to halve the proportion of people living in poverty by 2015, 1.2 billion more people will need access to electricity and 2 billion more people will need access to modern fuels like natural gases. A vast majority of the LDC population remains deprived of energy security and this is having a tremendous impact on the development of these communities.

Just the access to energy could encourage so many children to read, allow people to communicate easily and to use all of the wonders modern technology has to offer, to have hospitals with safe reliable equipments, and even stop deforestation. At a time when too much energy consumption is being blamed for the changing global climate, the need therefore is to invest in alternative energy sources that not only provide much needed energy in an eco-friendly way but also create thousands of ‘green jobs’ and use the human resources that would be required to set up the new ‘green economy’.

Civil Society in LDCs needs enhanced capacities and mobilization to ensure that local and national governments as well as development partner countries allocate resources needed for the universal access to food, energy, social service, gender equality, human rights and social justice. Strong advocacy and relentless lobbying is needed at all fronts to achieve this and especially in the context of the LDC IV, so that civil society can make meaningful contributions while the progress and setbacks of the BPoA are reviewed.

The discourse must not be limited to aid effectiveness but expanded to include development effectiveness as well. The increase in the number of LDCs from 24 to 49 today is clearly a failure of the development paradigm since the last 40 years. Unless we adopt a radical shift to a pro-poor and pro-people development paradigm, the structural causes of ODA failure in LDCs cannot be addressed. Quality aid as opposed to just increased quantity; untied aid; and total, unconditional cancellation of debts are key to achieving ODA effectiveness in LDCs.

I hope we can indeed materialise meaningful global partnerships for development for LDCs!

Thank you for your attention.