DEVELOPMENT: South Summit Launches Fund for Poorer Nations

By Thalif Deen Reprint | | Print |

Thalif Deen

DOHA, Jun 16 2005 (IPS) - As the cry for increased development assistance continues to intensify, one of the world’s fastest growing gas-rich developing nations in the Middle East has initiated the creation of a new fund to meet some of the urgent social, economic, health and educational needs of poorer nations.

As the cry for increased development assistance continues to intensify, one of the world’s fastest growing gas-rich developing nations in the Middle East has initiated the creation of a new fund to meet some of the urgent social, economic, health and educational needs of poorer nations.

Launching the new ‘South Fund for Development’, Sheikh Hamad bin Khalifa Al-Thani of Qatar pledged 20 million dollars in seed money to the proposed financing facility.

”I hope countries in the North and South would contribute to it,” he told delegates, even as Qatar’s announcement was quickly followed by instant pledges of two million dollars each by China and India, pushing the total to 24 million dollars.

The new fund was launched Thursday at the conclusion of the two-day South Summit Jun. 15-16 hosted by the Qatari government.

The high-level meeting, which was attended by over 5,000 delegates and media representatives, was held under the auspices of the 132-member Group of 77, the largest single coalition of developing nations.

The emir of Qatar also announced his commitment to meet the internationally-agreed benchmark of 0.7 percent of the country’s gross national income (GNI) as development aid, of which about 15 percent will be to least developed countries (LDCs), described as the poorest of the world’s poor. The targeted date is 2006.

Qatar’s commitment was all the more significant because the 0.7 percent target set by the U.N. General Assembly in the 1960s was applicable only to the world’s 22 richest nations in the industrial North. As a developing country, Qatar does not fall into the classification of a donor nation.

”While we welcome the improvement in the cash flow into developing countries in recent years,” Al-Thani said, ”yet many of them have not benefited much from it, since such aid is still at its lowest levels.”

Bangladeshi Foreign Minister Morshed Khan singled out last week’s decision by the European Union to double its official development assistance (ODA) by 2010, to reach the 0.7 target by 2015. ”I pay special tribute to the five countries, namely Norway, Denmark, Sweden, the Netherlands and Luxembourg, which have achieved the 0.7 percent target.”

”We hope the rest of the donors will redouble their efforts to meet their three-and-half decade old commitment,” Khan told delegates. The United States and Japan are two key donors who have not made any firm commitments to meet the 0.7 target on specific deadlines.

He said that annual ODA flows should increase to about 100 billion dollars by 2010: from the current average of about 55 to 60 billion dollars annually.

Anwarul Karim Chowdhury, U.N. under-secretary-general for LDCs, said he ”warmly welcomes” the Qatari gesture to the world’s poorest nations.

”We believe that LDCs are most deserving because they are the most economically vulnerable group of countries, particularly those in Africa. We hope other emerging developing nations will follow suit by devoting increased assistance to LDCs,” he told IPS.

Chowdhury said that 34 out of the 50 LDCs are on the African continent and are urgently in need of financial assistance to put their economies on a sound footing.

Abdulrahman Hamad Al-Attiyah, secretary-general of the six-nation Gulf Cooperation Council (GCC), told delegates that in the area of development, the GCC countries have played a silent leadership role.

”While the United Nations has long called for rich countries to allocate no less than 0.7 percent of their GNI to development assistance, few countries have done so,” he said.

In contrast, the GCC, comprising the largely oil-blessed countries of Qatar, Kuwait, Saudi Arabia, the United Arab Emirates, Bahrain and Oman, ”has long exceeded this goal by providing assistance directly, or through several development funds it operates.”

”We greatly appreciate the proposal to establish the South Fund for economic and social development, as well as to eradicate hunger and poverty,” he added.

Last week, the Group of Eight (G8) – namely, the United States, France, Britain, Germany, Italy, Japan, Canada and Russia – agreed to cancel the debts of some 18 highly-indebted countries.

The agreement will benefit some 18 countries, 14 in Africa, of which 13 are LDCs: Benin, Burkina Faso, Ethiopia, Madagascar, Mali Mauritania, Mozambique, Niger, Rwanda, Senegal, Tanzania, Uganda and Zambia

“It is a major step in alleviating poverty in Africa,” Chowdhury told IPS. He said he hoped the G8 initiative will be implemented in a quick time-frame.

But Delano Franklyn, Jamaica’s minister of state for foreign affairs and foreign trade, expressed reservations about the G8 initiative.

He told reporters the proposed debt cancellation was predicated on democratic governance. “But democracy is a relative term,” Franklyn argued, “and it would be interesting to see how the G8 defines democracy.”

He said the “enlightened decision” to cancel debts did not come by chance. The developing countries have been pressing for such consideration for more than a decade. “It has now manifested itself, but it is still better late than never.”

“But we do not believe it is right to extend assistance that is conditional,” he added.

Meanwhile, the summit adopted a 23-page Doha Plan of Action and a 14-page Doha Declaration which spell out North-South relations, South-South cooperation, and the shortcomings and economic inequities inherent in the international economic system which need to be rectified.