CS74: Opening Statement at Senior Official Opening

Delivered at Senior Official Opening, 74th Session of the Commission in Bangkok, Thailand

Distinguished delegates,

Welcome to the 74th session of the Economic and Social Commission for Asia and the Pacific.

The world has emerged from the global financial crisis. In our region, the positive impact of a broad based recovery is palpable. But the damage done has yet to be fully repaired. So the region needs more robust, sustainable and balanced growth and strong regulatory oversight to protect itself against emerging risks and new global uncertainty. Fast tracking the 2030 Agenda for Sustainable Development more vigorously is critical. Balanced equitable development, delivered through stronger social and environmental policies, is the only way to eradicate poverty and growing inequalities.

With this objective in mind, let me share our analysis of the critical issues facing the region on which we need to focus. I will then touch upon how the ESCAP secretariat has repositioned itself to support you in your efforts to overcome these challenges.

Over the past four years, our region has remained the engine of global growth. It continues to demonstrate resilience and dynamism. Two thirds of the region’s economies, accounting for more than 80 per cent of GDP, grew faster in 2017 than the previous year. Bolstered by a global economic recovery, the outlook for the region in 2018 is equally positive. The growth of the region’s least developed countries accelerated to 6.8 per cent in 2017. We expect these countries’ growth to continue at such rate in the near future: within a cat’s whisker of the 7 per cent target of the Istanbul Programme of Action for Least Developed Countries. 10 of the region’s 12 least developed countries have met the criteria for graduation 1, though the challenges to sustain growth remain, due to structural weaknesses and suboptimal business environments.

For regional economies to stay on course, several risks will need to be carefully managed. Domestically, the smooth transition of political cycles and the acceleration of structural reforms will be key to deal with structural weaknesses. Continued attention to enhancing domestic demand calls for more investment and policy measures to strengthen the region’s competitiveness. Economy and trade need to be diversified, infrastructure development and commercial exchanges facilitated, and business environments improved. International uncertainties remain. A weaker dollar, higher oil prices, inflationary and interest rate pressures, all complicate macroeconomic management. Rising protectionism and growing private debt - in some cases sovereign debts - could induce balance of payment vulnerabilities.

To support robust and sustained growth, and meet the funding requirements of sustainable infrastructure, fiscal policy will need to remain flexible and accommodative. A renewed effort is warranted to increase tax to GDP ratios and redistribute spending to lift productivity and reduce inequalities. Tax revenues in some of our countries can be as low as 10 per cent, half the global developing country average. So reforming taxation systems and their governance is key. This would increase both the tax take and people’s willingness to contribute. If Asia-Pacific economies had the same tax efficiency as OECD countries, revenue could be increased by as much as 8 per cent of GDP in some countries. This would allow public expenditure to be made more efficient and progressive, and the proceeds of growth shared more widely.

Over the medium term, growth potential needs to be lifted by improvements in productivity. Risks which could jeopardize such an increase include:

  1. demographic dynamics leading to a rapidly ageing population;
  2. frontier technologies offer many opportunities, but are already impacting on job markets and could aggravate inequality;
  3. an evolving international climate in which the value of globalization is being questioned by nationalists and insular vested interests;
  4. the deleterious consequences of climate change: sea level rises, floods and increasingly frequent and severe natural disasters.

Indeed, small island developing States remain vulnerable to economic and climate related shocks. Remoteness from world markets and a lack of productive capacities remain a perpetual problem. These constraints and limited capacities weigh on their economies, which combined with structural challenges, make them more susceptible to conflict. Poverty, income inequalities, lack of employment opportunities and chronic landlessness, particularly in rural, poorer regions and marginalised communities, threaten fragile countries. 11 countries in Asia and the Pacific region have crossed the high-risk threshold on the Index for Risk Management of which five are countries with special needs.

The complexities of managing peace have called for the UN system to harness the nexus between development and sustaining peace. The progress towards furthering peace on the Korean peninsula has captured the imagination of the world. But humanitarian crises continue to unfold. Sustained peace is a prerequisite of sustainable development. The responsibility for preventing conflict from becoming violent lies primarily with national Governments. But international and regional organizations have a key role to play through quality development advice, risk analysis and cost-effective strategies for conflict prevention, while working to develop focused long-term development responses. At ESCAP, we remain fully focused on strengthening our analysis to support sustainable development to address the root causes of conflict.

One of the major risks in this context is growing inequality in Asia and the Pacific. Our region’s remarkable economic success story belies a widening gap between rich and poor. Over thirty years, the Gini coefficient increased in four of our most populous countries, home to over 70 per cent of the region’s population. Human, societal and economic costs are real. Had income inequality not increased over the past decade, close to 140 million more people could have been lifted out of poverty.

If not tackled urgently, the poverty gap will persist and increase, and could thwart our ambition to achieve sustainable development. ESCAP analysis shows an integrated, coordinated response can over time return our economies and our societies to a sustainable footing. At its heart must be greater investment in our people. Access to healthcare and education must be improved. Only a healthy population can study, work and become more prosperous. The universal basic healthcare schemes established by Bhutan and Thailand are success stories to build on. Expanding social protection to low income families through cash transfers could help underpin a healthy society. Increasing investment in education is fundamental to both development and equality. The key to success is making secondary education genuinely accessible and affordable. Where universal access has been achieved, the focus must be on improving quality, upskilling teachers and improving curricula, and tailoring education to future labor markets and frontier technologies.

Information and Communication Technology - ICT - is a rapidly expanding sector. It can quicken the pace of development. But it is also creating a digital divide which must be bridged. So investment in ICT infrastructure is needed to support the development and use of innovative technologies and ensure no one is left behind. Put simply, we need better broadband access across our region. Geography should not determine opportunity.

Climate change, disasters and environmental degradation are pushing people back into poverty and can entrench inequality. In response, climate adaptation in the region’s disaster hotspots ought to be prioritized along with targeted policies to mitigate the impacts of environmental degradation on those most vulnerable, particularly air pollution. Better urban planning, regular school health check-ups in poorer neighborhoods, and legislation guaranteeing the right to a clean, safe and healthy environment should be part of our response.

The robust growth that the Asia-Pacific continues to enjoy, gives us an opportunity to take decisive action across all these areas.

Recognizing the challenges and realities, ESCAP adopted a multipronged strategy in 2014 to provide holistic advice and policy support for implementation of the 2030 Agenda in the region. On one hand, we have broadened and deepened our analytical and normative work. Over the last four years member States were provided with 126 publications and 1025 knowledge products. These have included thematic reports on relevant topical subjects, as well as the regular flagship reports focusing on economic, social, environmental and trade outlooks. We have raised the bar on the quality and diversity of policy advice. And remained steadfastly focused on the national and regional transformation, which needs to be supported by strong political will to pursue multilateralism through open, liberal and transparent macroeconomic, trade and sector policies, to lift productivity and resource efficiency.

In parallel, we advocated:

  1. Leveraging all sources of financing better and ensuring, advocating tax policy shifts to promote equity, tightening legislative and regulatory loopholes to curb revenue loss, rationalizing incentive and business frameworks to develop diversified and sustainable industrial solutions.
  2. Raising the ambition of regional cooperation and integration – key to enhancing political and social harmony. ESCAP has enhanced its support for regional connectivity and advocated the development of sustainable and climate friendly infrastructure, smart and intelligent solutions for movement of goods and people, fostering market integration, and enhancing frameworks for financing cooperation to strengthen financial systems and address the systemic risks. Given high exposure to shared set of vulnerabilities, disaster risk resilience frameworks are being enhanced in the region.
  3. Harnessing the nexus between development and sustaining peace through a mitigation framework that helps address the multidimensional risks to reduce region’s fragility and susceptibility to conflict.
  4. Developing greater understanding of how emerging frontier technologies can help lift the region’s productivity and efficiency, while dealing with the attendant dislocations and disruptions of labor and manufacturing through reskilling and economic diversification.
  5. Within the domain of social policies, the region has to grapple with the twin challenges of how to better leverage the demographic dividend by empowering youth, while dealing with risks associated with an ageing population and augmenting social safety nets for them.

The enhancement of ESCAP’s evidence and policy making role, along with the reorganization of ESCAP’s conference structure you approved, has helped raise the quality of our intergovernmental engagement. With your support, our capacity building and technical cooperation programmes now offer new and improved services across the three dimensions of sustainable development. This will help mainstream planning, fiscal and financial policies and nurture policy coherence and integration. ESCAP continues to pursue multilateralism by supporting harmonized rules and regulations, developing and operationalizing trade and businesses, and developing a knowledge base, tools and instruments to effectively respond to challenges.

To conclude, I am proud to report we have positioned ESCAP to support an accelerated transition to an inclusive, sustainable and prosperous future for people across Asia and the Pacific – working with UN-wide, private sector and country partnerships. To continue doing so, we need your continued guidance, commitment and active support. The world is looking to our region for a strong regional drive to harness multilateralism and global governance for shared prosperity.

I am looking forward to your deliberations in the days ahead.


1Bhutan, Kiribati, Nepal, Solomon Islands, Timor-Leste, Tuvalu, Vanuatu, Bangladesh, Lao PDR and Myanmar.