CS73: Opening Statement during Special Body on Least Developed, Landlocked Developing and Pacific Island Developing Countries

Delivered during Special Body on Least Developed, Landlocked Developing and Pacific Island Developing Countries at Seventy-third session of the Economic and Social Commission for Asia and the Pacific in Bangkok, Thailand.

Excellencies,
Distinguished delegates,
Ladies and Gentlemen,

ESCAP’s Special Body on Least Developed, Landlocked Developing and Pacific Island Developing Countries has been the key platform for our intergovernmental dialogue. These countries, referred to as the Countries with Special Needs (CSNs), are among the most vulnerable in the world and continue to face challenges to inclusive growth and sustainable development. These challenges are associated with remoteness, geographic features, resource availability, demography, climate and a combination of these factors. This has resulted in limited progress in structural transformation, slower development of productive capacities and heightened vulnerability to external shocks, such as from volatile commodity prices, climate change and natural disasters.

ESCAP has been extensively engaged in assisting CSNs in their efforts to close development gaps with other developing countries in the region. We have supported and monitored progress in the implementation of the Istanbul Programme of Action for LDCs, the Vienna Programme of Action for LLDCs and the SAMOA Pathway for SIDS.

The least developed countries in the region have made progress in implementing the Istanbul Programme of Action and have improved their prospects for graduating from the LDC category. Progress has been made in reducing poverty, strengthening productive capacities, promoting agricultural development, increasing exports, investing in human resources and mobilizing financial resources. Similarly, the 12 Asia-Pacific landlocked developing countries, some of which are also LDCs, have continued to implement policies aimed at achieving sustainable development and enhancing their regional connectivity.

Nevertheless, the CSNs continue to face significant developmental challenges. For instance, among LDCs, manufacturing and agricultural productivity is still relatively low, requiring increased investments in infrastructure, human resources, science, technology, innovation and institutional development. More efforts in LDCs and LLDCs are also needed to overcome the constraints related to trade and investment. Official development assistance, foreign direct investment and remittances, although increasing, need to be used to build up the competitive strengths of these countries and to support the achievement of the SDGs. There is also major scope for improving governance and establishing more transparent and accountable frameworks.

For LLDCs, both external and internal factors constrain their ability to overcome developmental challenges in priority areas. For resource rich LLDCs the fluctuation in commodity prices poses a great challenge in budgetary planning and thus development-orientated expenditure. For others, political cooperation with neighboring transit countries is often a difficult endeavor. LLDCs’ internal constraints include limited economic diversification, which compounds their geographical predicament. Moreover, the relatively recent economic transformation of nine of the region’s twelve LLDCs from centrally planned to market economies has increased the vulnerability of these countries. This has, especially recently, only added further to challenges these countries face from the continuing uncertainty in global trade and investment flows and relatively low commodity prices.

Similarly, the main developmental predicaments faced by SIDS are often beyond their direct control. For instance, geographic isolation and its implications for trade and development ranks high among these challenges. At the same time, SIDS must also deal with the existential threat of climate change, while their contribution to global greenhouse gas emissions is negligible. Accordingly, ESCAP has been advocating for enhancing regional economic integration and cooperation to enable countries to collectively address these challenges on a broader platform.

Recent changes in the political atmosphere caused by the uneven gains from globalization poses an additional threat to all of the CSNs as it threatens to potentially limit their developmental abilities. Already we are seeing a rise in economic protectionism, which will indeed negatively impact the most vulnerable of our economies. ESCAP advocates that enhanced cooperation and economic interaction among countries can bring about positive change. We have delivered our view on as well presented in our regional trends and prospects for regional cooperation in our regional report on Regional Economic Cooperation and Integration, as well as in our 4 subregional reports on the topic. These 5 analytical knowledge products were discussed in detail during the recent High-Level Dialogue on Regional Economic Cooperation and Integration for Enhancing Sustainable Development in Asia and the Pacific.

The Countries with Special Needs Development Report 2017 underscores that infrastructure development and financing must be seen as the key priorities for the CSNs as it provides wide economic, social and environmental benefits. This importance is recognized in internationally agreed development goals, including the 2030 Agenda for Sustainable Development (Goal 9) and the programmes of action for LLDCs, LDCs and SIDS, which all highlight infrastructure as a priority area for development.

However, current levels of infrastructure funding among CSNs fall far short of their financial needs, which average 10.5 per cent of GDP. This indicates that existing sources of financing are insufficient to meet the large and growing needs of these countries. This also highlights the importance of a more effective, efficient and catalytic use of existing funds to attract private finance and other emerging sources of finance.

In order to fill funding gaps and overcome challenges, governments in CSNs need clear financing strategies and capacity development for effective long-term planning. These include improving public expenditure, mobilizing domestic resources, leveraging the private sector, improving access to capital markets and tapping new sources of funds, such as climate finance. Internationally, there are a number of emerging financing opportunities that CSNs can tap to bridge financing gaps for infrastructure development. These include ODA from development partners and multilateral development banks, new regional initiatives and infrastructure funds as well as new financing vehicles.

ESCAP has assisted CSNs in overcoming developmental challenges through multiple initiatives. In 2016 and 2017, a number of activities and initiatives were organized and delivered by ESCAP to help mainstream and implement programmes of actions for CSNs. ESCAP projects have traditionally been aimed at capacity building to support achieving the SDGs. Examples of ESCAP activities included, among others:

  • Delivering capacity building on trade policy formulation, negotiation, and analysis to improve the effectiveness of trade policies for the SDGs; supporting the design and implementation of free trade agreements for inclusive and equitable trade; investment promotion; enhancing productive capacity and SME development; promoting cross-border paperless trade facilitation; and supporting development of evidence-based trade facilitation programmes, including in support of the WTO Trade Facilitation Agreement;
  • Delivering capacity building to reduce inequality, disability data collection, and gender-responsive budgeting;
  • Providing inter-governmental platforms for building disaster resilience and resilience for ICT infrastructure;
  • Providing regional forums, including the Asia-Pacific Forum on Sustainable Development and several capacity building programmes on environment and the implementation of the 2030 Agenda; and
  • Providing technical assistance to strengthen economic and environment statistics, including through delivering capacity building on Civil Registration and Vital Statistics and Transforming Official Statistics for implementing of the 2030 Agenda.

As in previous years, key Secretariat activities supporting the implementation of the Samoa Pathway and the SDGs in the Pacific have concentrated on:

  • enhancing national capacities and institutions;
  • enhancing the Pacific voice and representation in regional and global processes; and
  • ensuring the realization of a transformational strategy for the sustainable development of SIDS by strengthening the role of the Commission in monitoring the follow-up to the Samoa Pathway and the 2030 Agenda.

In conclusion, I would like to emphasize the importance that the Secretariat attaches to supporting the development of the CSNs. This group of countries represents the majority of our member States and constitutes the key to our success in regional developmental efforts through implementation of the 2030 Agenda.

I hope that the upcoming discussions will produce more guidance for the Secretariat and member States on how to tackle poverty and ensure inclusive and sustainable development by closing development gaps in the region. This would allow the most vulnerable countries in the region to accelerate their developmental progress.

I thank you.