High-Level Meeting to discuss the gaps and challenges of middle-income countries in the implementation of the 2030 Agenda for Sustainable Development

4 December 2018, UN Headquarters, New York

Overview

The meeting, convened by the PGA, consisted of two interactive panel discussions, a plenary segment and a luncheon on the middle-income trap.

In her opening remarks, the PGA pointed out that the meeting demonstrated the tenacity of MICs to shed a light on the distinct and unique challenges they face. In the last 50 years, MICs have become a growing economic force substantially contributing to global GDP and boosting their international exports.  These countries shelter 70 per cent of the world’s population.  Hence, improving living conditions there is critical. She also highlighted the challenges they face and warned that unless their obstacles and vulnerabilities are duly addressed, the 2030 Agenda for Sustainable Development will not be met. She stressed the need to eliminate inequality and financing gaps, the importance of developing fiscal policies and boosting women’s participation in politics and in the economy. During the opening session, DESA ASG for Economic Development, Mr. Harris highlighted MICs leading role in achieving the SDGs, particularly those related to poverty reduction and that cooperation among these countries must focus on building resilience against external shocks to avoid falling into the middle-income trap. He also assured that UNDS reform efforts will better position the system in assisting MICs. ECOSOC VP, Mr. Rybakov said that achieving the 2030 Agenda would require greater international support for MICs as they grapple with rapid technological change, mass migration, crippling debt and many other challenges that can only be addressed in a coordinated manner.  Hard-won development gains are at risk, he warned, adding that the sustainable development of MICs has the potential to stabilize regions in conflict and that development cooperation can help them build resilience and adapt to humanitarian crises. The first panel discussion was entitled “Successes and challenges in the implementation of the 2030 Agenda for MICs”. Panelists acknowledged MICs contribution to the improved global economy and recognized their shared challenges including vulnerability to natural disasters, limited access to concessional financing, high indebtedness levels, etc. National representatives shared their own countries’ successful stories and experiences and panelists from international agencies shared examples of cooperation with MICs. During the Q&A session, delegates discussed common challenges; expressed concern on the use of per capita income to measure development and called for a more comprehensive indicator that recognized the multi-dimensionality of poverty. They also acknowledged the importance of cooperation including South-South, Triangular and North-South cooperation, and highlighted the role of regional cooperation in support of efforts to achieve the 2030 Agenda and SDGs. In response to questions, panelists mentioned ideal tax-to-GDP ratios; shared examples of good practices; stressed the importance of technology. They also introduced some new methodologies to measure the development levels of countries. In panel two, entitled “The role of South-South cooperation and Triangular cooperation in the implementation of the 2030 Agenda for Sustainable Development”, panelists suggested reconsidering cooperation modalities and stressed the critical role played by south-south and triangular cooperation. Ms. Barcena stressed the need to deepen South-South and triangular cooperation, particularly against the backdrop of the paradigm shift that the 2030 Agenda represents for international cooperation with MICs. Mr. Pedro mentioned that it is important for MICs to diversify their export structure and stressed the importance of coordinated and predicable investment as well as deeper partnerships to advance research and development. During the Q&A session, while acknowledging that ODA continues to play a major role in development, delegates stressed the strategic role of SSC and noted that in recent years it has moved to the center stage of development. They also called for a paradigm shift in development cooperation. RCNYO/2018/SY/CG/INF79 1

A working luncheon discussion on the Middle-Income Trap was also convened. This discussion focused on how to break free from the Middle-Income trap, including the need to take into account the multi-dimensional nature of poverty and give MICs access to concessional finance. Ms. Barcena’s intervention focused on MICs challenges in breaking the middle-income trap due to difficulties in moving to a higher innovation / productivity level and presented ECLAC structural gap approach according to which in order to overcome these traps, countries need development policies and strategies that confront the structural gaps and obstacles keeping them from achieving inclusive growth. This approach also constitutes an alternative framework to determine official assistance allocation. In her closing remarks, the PGA assured all delegates that the Assembly has heard the challenges that MICs face to fulfill the 2030 Agenda, including the consequences of climate change, their dependence on commodities exports, the debt burden and the volatility of exchange rates and capital flows. The Assembly also heard their request to move beyond per capita income to measure sustainable development. The PGA will send a summary of the High-level meeting to the SG so that the issues discussed will be reflected in the SG report on the implementation of resolution A/RES/72/230 to be presented during the 74th session of the GA.

Opening Segment

PGA, Ms. María Fernanda Espinosa Garcés This meeting provides MSs an opportunity to discuss the challenges in implementing

2030 Agenda and SDGs and other developmental goals. It shows that multilateralism is still strong. Middle Income Countries (MICs) have become a growing contribution force in terms of economic growth and poverty reduction. MICs’ needs are special

The classification based on per capita income does not reflect the diversity of needs, challenges and capabilities of MICs

It is fundamental to close the gap in poverty, inequality, financing and investment. The mobilization of financial and technological resources is required. Sustainable and predictable domestic resources are important and should be utilized efficiently. It is essential to develop redistributive fiscal policies

MICs need responsible investments especially with respect to human rights, environmental regulations and fiscal and labor regulations

MICs suffer from a reduction in the flow of development assistance; we must renew the foundations of development cooperation including South-South Cooperation (SSC) and Triangular Cooperation (TrC) focusing on sustainability and the reduction of inequalities. The Second High-Level Meeting of the United Nations on SSC, which will take place in March 2019 in Argentina, will be an excellent opportunity to address these gaps

Prime Minster of Antigua and Barbuda Mr. Gaston Alphonso Browne The criterion of per capita income is a palpably false basis of judging a country’s

wealth or its level of development and it should be changed. Fair trade, access to finance, anti-competition rules, size, debt burden and vulnerability to climate change should also be factored-in when measuring a country’s development

Many MICs and small island developing states did not create climate change but are suffering from it. Similarly, they did not create the global financial crisis but are compelled to overcome its effects

As MICs seek to diversify their economies, some rich nations block their efforts. Those rich countries also control taxation and financial services and unilaterally enforce arbitrary rules

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The international community can help to address the developmental gap in MICs in many ways:

o Should agree that income per capita method is flawed and formulate a new methodology that would take into account vulnerabilities and other factors

o Concessional finance must be provided to help MICs to continue developing o Should create a global partnership on debt relief – e.g. ECLAC recommended

debt for climate swaps can be used to reduce the debt burden, which could improve energy security, climate and economic resilience

o Climate change must be recognized and the world’s worst polluters must admit and deliver the necessary adaptation and mitigation financing

Urged MSs and the UN to work collectively in building a transformational model of cooperation for sustainable global development and building an inclusive and sustainable global financial and trade architecture that provides prosperity to all

DESA ASG Mr. Elliott Harris Highlighted that MICs play a leading role in achieving the Sustainable Development

Goals (SDGs), particularly those related to poverty reduction On poverty: robust economic development does not necessarily free people from

poverty On gender equality: there is a need to focus on education MSs and the UN need to more strongly focus on the concept of leaving no one behind On systemic resilience: It is easy for MICs to fall back into poverty. Development

should focus on building resilience against external shocks To avoid the middle-income trap that prevents MICs from further advancing their

development, need to prioritize human capital and invest in new technologies UN has to be active with MICs. UN has promoted SSC and the SDGs, which require

further input and effort including transparency, effectiveness and responsiveness Look forward to the partnership between UN and MICs Efforts to reform UNDS will better position it to assist MICs

ECOSOC Vice-President, Mr. Valentin Rybakov (Belarus) Achieving 2030 Agenda and the leaving no one behind concept requires greater

international support for MICs MICs are influenced by rapid technological change, mass migration, crippling debt

and other challenges that can only be addressed in a coordinated manner by the cooperation between MICs and the UN

International cooperation must include social, economic, technological and other aspects. For instance, provide market access within global value chain

National development policies should be aligned to SDGs With international cooperation, MICs have the potential to stabilize regions in conflict Recognized the contribution of agencies including Global Concessional Financing

Facility, Islamic Development Bank and World Bank global partnerships SSC should not only be governmental but also with the private sector

Interactive Panel 1:

“Successes and challenges in the implementation of the 2030 Agenda for MICs” Moderator: DESA ASG Mr. Elliott Harris

o MICs is not a homogeneous group in social performance, economic potential and financial condition but share similar concerns: natural disasters, combating climate change, high level of external debt, high volatility and sustainability of their debt

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o Stressed the need to grant access to new technologies to boost their economic development

o MICs tend to be highly dependent on commodity exports and need prudent macroeconomic frameworks

o International cooperation is needed to help them avoid middle-income trap and keep on the path of sustainable development

Minister for Economy and Finance of Morocco Mr. Mohamed Benchaabouno Morocco is undertaking enormous efforts to realize the SDGs and reduce

inequalitieso Gaps and challenges are still large. Many MICs economies suffer low added

value and fluctuating commodity priceso Morocco has integrated the SDGs into national efforts:

Green plan: targeting agriculture and its resilience to climate change Energy strategy: increased use of renewable energy sources 2030 strategic vision for education has allowed it to ensure better job

training and to increase employment opportunities for youth and women

Adopted 2017 national development strategy to better integrate the SDGs

o Finance sector should be focusing on the role of inclusive finance, financial innovation and introduction of new instruments including microfinancing

o Strengthening support to start-ups o Public and private cooperation plays an important role in agriculture,

transportation and renewable energyo All these initiatives are being undertaken with limited budgets; there is a need

to mobilize additional national resources for development and to increase technology transfers

o Partnerships with regional banks help reduce costs and be more creative in the mobilization of resources towards development projects

Vice-Minister for Development Cooperation of El Salvador Ms. Ryna Garayo El Salvador is committed to the implementation of the 2030 Agenda as shown

with National Voluntary Reviews o The integrated and indivisible nature of the 2030 Agenda and its ambitious

goals generate the need for a large mobilization of resources o The measurement of a country’s development should not be solely based on

the national income per capita. The criteria should reflect the social, economic and environmental heterogeneity, the diversity of needs and challenges that characterize countries

o Challenges for MICs Accessing favorable financing and on concessional conditions Need to increase efficiency of tax planning Vulnerability to climate change

o Allocation of national budget to social development, driving public finance in order to address the issue of public sector solvency

o El Salvador promotes private sector involvement to ensure efforts to achieve the 2030 Agenda are sustained

UNDP ASG and Director Mr. Abdoulaye Mar Dieye

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o Complex and comprehensive indicators such as the Human Development Index should be used

o MICs fall into a middle-income trap when they rely too heavily on their comparative advantages that brought them to the middle-income level in the first place

Trap reasons include the dependence syndrome - depend on one or two commodities’ export – and on low human capital - high economic growth but high poverty; creating jobs, investing in innovation and new technologies could help avoid this trap.

o Countries can avoid the middle-income trap by diversifying their economies and creating the conditions that allow for sharing of development gains.

o Importance of keeping the tax-to-GDP ratio to 24% for promoting sustainable development

o Advices to MICs Ensure resources are used efficiently Partnership with OECD Need to develop low risk investment environment

IMF Deputy Managing Director Mr. Tao Zhango MICs have huge leaps forward in efforts to achieve the SDGs o MICs have diverse development pathso MICs need to must pursue structural reforms to sustain medium-term growth,

by advancing labor market reforms and trade liberalizationo Five reform priorities:

Fiscal policies should be well defined Actions to ensure equal access to education and health services Financial inclusion requires legal and regulatory framework Building economic and financial resilience. Those who are vulnerable

to climate change should focus on disaster planning and emergency response

o Prepare well for the future of work by adopting advanced new technologies Word Bank Senior Director Ms. Carolina Sánchez-Páramo

o Poverty and inequality are still key issues o World Bank has introduced new methodologies to measure poverty that will

provide better assessments of inequalityo The Bank has also introduced a new multidimensional poverty measure that

accounts for myriad means of deprivation such as lack of education. It has also introduced two sets of poverty lines: $3.20 and $5.50 a day

o Poverty does not only include being deprived from income but also from basic infrastructures like water and electricity

o Study shows that there is a strong correlation between education and economic mobility - the most important investment for a country is investment in its people

o Shared examples of cooperation between MSs and World Bank: Agriculture programme in Nigeria especially women farmer Develop social protection mechanism in Mexico for youth to have

better education World Bank introduced innovations to Mongolia

Q&A Jamaica

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o  What is the ideal tax-to-GDP ratio to promote development? Indonesia

o Asked how MICs can ensure that they gain maximum benefits from technological advances while minimizing negative impacts on their populations

o Commented that sustainable development is not linear and highlighted that its measurement should go beyond the income per capita

o Noted financial development gaps. Urged to enhance cooperation and resources mobilization both domestic and foreign, financial and non-financial

Zimbabweo Shared MICs challenges:

Job creation and structural transformation is slow Reducing poverty is crucial Closing infrastructural gap Limited fiscal space Need debt restructuring Limited room and limited scope to access resources Oil producing countries are facing falling prices

o Positive side: seeing progress in financial inclusion Nigeria

o Voiced concerns about information presented by the World Bank and called for the use of alternative sources of information

o Asked panelists how MICs can achieve their goals within an international system that is skewed against them

Philippineso It is necessary to adopt criteria that go beyond income per capita o Philippines national policy has adopted new multi-dimensional poverty index

to improve countries’ development design in education, health, housing and employment

Costa Ricao Underscored growing dissatisfaction among MICs with how resources have

been invested to promote sustainable development o Highlighted the need for a paradigm shift o Access to financing – climate vulnerability creates needs that might be the

source of growing dissatisfaction Uganda

o Agrees that investing in people is critical. Policies should be inclusive and sustainable

o Highlighted the importance of SSC, TrC and role of Regional Commissionso Asked questions regarding raising of the tax base and how countries can

mitigate illicit financial flows Mauritius

o Joined Philippines on the measurement issueo Welcomed UNDP multi-dimensional poverty indicator o Asked how IMF would use the new index to better assist island countrieso Expressed the difficulty for Mauritius to catch up with the technology gap

Answers: UNDP ASG and Director Mr. Abdoulaye Mar Dieye

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o There are divergences on tax to GDP ratios. OECD’s data shows that the ratio should be 35 - 40 %. However, recent studies indicate that to ensure domestic financial resources are promoting growth the tax-to-GDP ratio must be 24 %

o Singapore and South Korea are examples that accelerated the graduation process.

o Innovation does not have to necessarily be imported and sometimes governments have only to provide capacity and people will do the rest

o Inequality remains a major menace o Illicit financial flows are also a critical obstacle to development

Minister for Economy and Finance of Morocco Mr. Mohamed Benchaabouno Morocco’s tax-to-GDP ratio is 20%. Moreover, Morocco is trying to lower the

tax rate to attract foreign investmentso It is important to use technology to improve overall environment globally as

well as improve administration efficiency such as reduce custom clearance time and improve government transparency. Universities integrate technology and business use technology to increase capacity. Countries are not attractive unless they are competitive and use technologies. In Morocco, the mobile technology is important and the portion of smart phone utilization increased the portion of people using technology and reduced gaps. Financial inclusion is also fundamental. Mobile based payments are necessary so the banking can provide better services

o Morocco receives some $6.5 billion in remittances from its citizens abroad. The Government has set up physical infrastructure in countries hosting its citizens to facilitate transfers

IMF Deputy Managing Director Mr. Tao Zhango Tax to GDP ratio requirements vary based on countries’ specific conditions. It

also depends on the tax administration and governanceo Addressing the financing gap requires implementing institutional reforms.

Financial gaps come with other crucial problems including how to fill in policy gaps. Dual goals to enhance life quality and achieve SDGs cannot be achieved unless MSs fill different gaps together

o Stressed market access, resilience to natural disasters and climate change as well as better mobilization of private sector resources

o Addressing the financing gap requires implementing institutional reforms Word Bank Senior Director Ms. Carolina Sánchez-Páramo

o The international community has been too focused on the impact of automation on employment. Rather, attention must be placed on the impact of technology on the price of products as the decreasing cost of goods can have major impacts on the livelihoods of people

o Mentioned four areas: legislation, infrastructure, (inclusive) skills and capability, access to market

o Regarding how the multidimensional poverty index influences the work of the World Bank, she spoke of human capital projects in MICs

Vice-Minister for Development Cooperation of El Salvador Ms. Ryna Garayo El Salvador has aligned its national development plans with the SDGs, e.g. it

has focused on increasing literacy rates through providing access to computers to children in primary education - inclusive access to technology will lead to an increase in national productivity levels

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o Production base needs to expand together with technological and scientific development

o Also focusing on inter-sectorial coordination; on building capacities to adapt to climate change; on how to best leverage remittances; and on advocating for a review of foreign debt

Moderator’s closing remarkso Recognized different gaps including financial gaps, policy gaps, and

institutional gapso Inadequate resources and fiscal space o Stressed the ability of government to use technology to improve efficiency o Pointed out that MICs do not lack awareness nor ideaso Called for greater consideration of indicators that can better assess the

development status of Countries

Plenary Segment Antigua and Barbuda o/b CARICOM

o Urged placing upper MICs and MICs in the same category with emerging countries

o Graduation is an arbitrary and imaginary line of per capita income and the criteria should be changed

o MICs group is not homogenous in character as there are varying levels of inequality, rates of poverty and economic performance, range of natural resources, productivity and innovation

o One issue of commonality is the inadequate access to concessionary financing and official development assistance and there are other challenges:

Combatting climate change and natural disasters Inadequate access to climate finance and financing for development The hefty levels of indebtedness and burdensome re-payment structures The negative impact on economic sectors due to the withdrawal of

correspondent banking relationships and the livelihoods of citizenry dependent on those sectors

o Called for priority consideration and action to the following: Establish timelines from the international financial institutions for the

recognition of an alternative criterion to the GDP as an assessment of a country’s level of development

Climate Finance initiatives must be a central component of programming for MICs

The facilitation of a review of the high indebtedness level of Caribbean territories

CARICOM supports the continuation and expansion of the remit of mechanisms to assess the resilience of MICs

The evaluation of UNDS programming to ensure greater efficiency, effectiveness and accountability

Advocacy role of UN as the interlocutor between MICs and international financial institutions and the wider donor community

The convening of technical workshops to identify countries capacity development needs is welcomed

Ongoing public-private sector dialogue in pursuance of SDG 17 - the establishment of reliable and durable partnerships are welcomed

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o Encouraged UN and the international community to continue to offer their support to MICs

o Believed that SSC, NSC and TrC and other partnerships will play a pivotal role in building resilience and capacity for MICs

Moroccoo Morocco has worked on eradicating poverty in all dimensionso Inequality persists in MICs. Faced with many challenges that must be reflected

through appropriate ranking and categorization o Action needed on three fronts:

Need to review graduation process Need to strengthen cooperation mechanisms, which have to adapt to

national priorities and strategies Need to strengthen the global partnerships framework; public private

partnerships are important Cabo Verde

o MICs are confronted with major challenges to achieve sustainable development, such as the eradication of poverty, unemployment, social inclusion and sustainable management of the environment and of natural resources

o Financing for development remains a crucial problem for MICs, very often linked to the process of graduation that excludes graduated countries from accessing ODA and other flows of resources

o Lack of access to UN system - MICs need to be visible under UN’s frameworko Aid need to focus on the needs of MICs. MICs must have special standardo MICs face many problems including small domestic marketso Cabo Verde also faces many other problems, e.g. remoteness, insularity, the

small size of its market, acute economic and environmental vulnerabilities. o Cabo Verde set a vision of development:

Make Cabo Verde a circular economy Guarantee sustainable economic development Strengthen democracy, justice and international diplomacy

Zimbabweo The 2030 Agenda recognizes the challenges that MICs are facing in the

process of attaining sustainable development. Despite growing economies, MICs face challenges in trying to mobilize finances and innovate for development

o UNDS and international financial institutions can support MICs to build capacity and resilience to achieve sustainable development

o Zimbabwe’s vision is to transform the country to upper MIC by 2030. Have developed a short-term strategy to attain triple “S” growth- strong, sustainable and shared

o Zimbabwe has made progress in food security, agriculture, energy and water and sanitation

o It is necessary to re-conceptualize development and rethink domestic policies and international cooperation for development; ODA is still critical

o Called for strong partnership and private sector cooperation Russian Federation

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o Challenges: high level of internal inequalities especially in education, debt and employment. UN should provide targeted assistance including on modern digital technology

o Implementing the 2030 Agenda requires free movement of goods and people, which will also help overcome internal inequalities

o On UNDS reform, the empowerment of the RC system and a greater focus on local needs should help MICs overcome the challenges they face

o Unified custom areas and regional communities like the Eurasian Economic Union can help overcome inequalities while pulling up countries to the level of those who drive economic development

Cubao There must be a more comprehensive, multidimensional and complete

methodology for classifying levels of development that goes beyond income indicators and which accounts for the special challenges, vulnerabilities, structural gaps and particularities of countries

o The problems faced by MICs must be addressed in a multilateral framework. MICs should reject attempts to weaken existing multilateral mechanisms

o Cuba is a MIC subject to an economic, commercial and financial blockade by the Government of the United States. SSC is a valuable complement to NSC

o Cuba has implemented cooperation programs with 157 countries in health, education and sports. For instance, exchanged students from Asia and Africa

o Reiterated Cuba’s commitment to cooperation in solidarity with other countries, based on mutual respect, disinterested aid and complementarity

o Reaffirmed Cuba's full commitment to the implementation of the 2030 Agenda and the search for a more just, equitable and inclusive world that recognizes people as the center of sustainable development

Spaino The 2030 Agenda is a paradigm shift and we must adopt multi-dimensional

measurement that go beyond GDP o Spain adopted a measurement promoted by the University of Oxford, the

Multidimensional Poverty Index o International cooperation plays an important role among MICso Acknowledged the importance of cooperation including SSC an TrC in

implementing the SDGs El Salvador

o Stressed the necessity of greater resources mobilization including financial and non-financial resources

o Access to financing and internal cooperation is the key for MICs o Need to review current measure of development and replace it with multi-

dimensional criteria o Overcoming these challenges requires multi-country partnership

Tajikistano Tajikistan has adopted new national development strategy under the guidance

of 2030 Agenda Poverty rate has dropped Invested in water to achieve SDG 6 Share green electricity to neighbors in response to SDG 7

o As a landlocked country, Tajikistan needs financial support as well as ODA

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Egypt o/b G77 and Chinao The international community needs to work closely together o Gaps and challenges still remaino It is urgent to identify the needs of MICso It is important to exchange experience and improve coordination among

regional organizations o Urgent to make institutional arrangement within UN system in particular the

long-term strategyo Invite UN system and financial institution to make transparent measurement

that go beyond income criteria and recognize multi-dimensional poverty and structural gaps

Luncheon discussion on the Middle-Income Trap Moderated by Gillian Tett, Financial Times journalist Interventions from the Ms. María Fernanda Espinosa Garcés, PGA; Ms. Sarah Cliffe,

Director, NYU’s Center on International Cooperation; Ms. Ryna Garay, Vice-Minister for Development Cooperation of El Salvador; and Ms. Alicia Barcena, ES/ECLAC

The discussion focused on how to break free from the Middle-Income trap, including the need to take into account the multi-dimensional nature of poverty and the need to give MICs access to concessional finance. It also discussed the need to mobilize domestic resources

MICs need to have good quality secondary and tertiary education and reduce inequalities – social cohesion should not be undermined

MICs need to transform economies from resources-driven growth models to models based on high-productivity and innovation; also, we should shift from a model based on growth alone to one of equitable growth that leaves no one behind

It was also highlighted that MICs face a number of social challenges, including conflict, high homicide rates and host large refugees’ populations

MICs also provide examples to high-income countries such as with their empowering social protection policies and programmes and their model of cooperation.

Countries should identify traps and structural gaps/impediments keeping MICs from achieving inclusive growth (structural gap approach). E.g.

o Trap: MICs too often rely on exporting commodities so even though their economies grow, their welfare does not improve. This situation also makes MICs vulnerable to fluctuating markets. To improve, they need to diversify their export structure

o Gap: need to increase taxes to have enough resources for sustainable development

o Trap: not being able to move to another innovation / productivity level (productivity trap), low salaries

o Gap: investment gap – need to control evasion, raise taxes etc. Development has to mean graduality, not graduation – need for a new international

cooperation paradigm Need debt relief initiative Need to change the metrics that measure development, including recognizing the link

between poverty and inequality (Gini coefficient should be considered). Need to also include the concept of vulnerabilities

The importance of SSC and TrC to deal with the Middle-Income trap. Need for a serious discussion to ensure SSC does not use the same metrics as DAC/ODA

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The role governance plays in the Middle-Income trap, including the need for a global financial architecture

Interactive Panel 2: The role of SSC and TrC in the implementation of the 2030 Agenda for Sustainable Development

Moderator: Vice-Minister for Foreign Trade and Investment of Cuba and Chair of the ECLAC South-South Cooperation Committee Ms. Ileana Núñez Mordoche

OECD Director Mr. Mario Pezzinio Acknowledged growth and development achievement of MICso SSC and trade have increased substantiallyo Challenges includes extreme poverty, economic challenges, social challenges

and geopolitical challengeso The problem in MICs often stems from the lack of capacityo Triangular and SSC are indispensable in that regard, adding that challenges are

becoming increasingly more difficult to solve with just “two people” at the table

o To avoid middle-income traps: Government requires policies and tailor-made strategy Promote knowledge sharing Enhance multilateral cooperation; SSC and TrC are indispensable

Minister for Foreign Affairs and Communities and Minister for Defense of Cabo Verde Mr. Luis Felipe Tavares

o SSC should not rule out other cooperation. SSC is a complementary to NSCo Learn historical heritage and explore role of implementation of 2030 Agendao Cabo Verde has benefited from partnership and from ICT o Shared examples of his country collaborating with other Southern nations:

Partnership with Angola that promotes the empowerment of women City-city cooperation focusing on knowledge sharing in urban

gardening and agriculture ECA Regional Director, Sub-Regional Office for Central Africa Mr. Antonio

Pedroo Stressed the need for coordinated and predictable investments o Oil based countries have limited export choice and high dependence on the

marketo Need to promote structural and sustained economic cooperation o Call for fully implementation of industrialization in Africa o More investments are needed to change the structural composition of the

continent. That requires countries to better understand their comparative and competitive advantages. It is critical for SSC to focus on technological innovation and research

o Africa’s development model could be more balanced and inward-looking to fulfil its own needs. Stressed the role of regional integration and trade including accelerating AfFTA next year. Africa should expand trade internally.

o SSC and TrC play an important role in providing unrestricted access to market and helping MICs to attract financing flows

o Africa could explore SSC on specific topics such as tropical forest (ex. Indonesia and Malaysia cooperation on palm oil industry diversification)

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o Addressing the middle-income trap requires engaging the private sector and increasing bankable projects

UNOSSC Director Mr.  Jorge Chedieko Introduced the history of SSC:

In the 1970s it was believed that the mere transfer of technology from the North to the South would produce the same results accomplished in the North.  Many believed that this would create “islands of progress” in developing countries which would carry the entire country towards progress

In the 1980s and 1990s, Regional Commissions have mandate to promote SSC but it was not a central component of the UN. It was more prevalent in the work of regional organizations

This century, countries from the South have transformed their economies and made much progress. At the same time, developing countries and international organizations decided to commit funds and engage in TrC. China and Brazil and Asian tigers showed that Southern countries’ potential and SSC became to the core of UN work

o Expressed concern that many Southern countries still do not have the structure to support SSC

o A lot can be done at national, regional and global levels. Regional Commissions did a good job on building regional architecture at the regional level but a lot still remains to be done

o SSC Expo has showed that SSC has been influential o Urged all MSs to renew their commitment to both SSC and TrCo UN system is fully committed to support MICs

ECLAC Executive Secretary Ms. Alicia Bárcena Ibarrao Cooperation is at a turning point facing problems such as multilateralism crisis,

demographic challenges, deteriorating foreign trade and FDI, a less dynamic global economy, and the fourth industrial revolution

o The difference between BAPA and BAPA+40 is that 40 years ago we did not have the 2030 Agenda, which proposes a shift in the development paradigm

o Countries in the LAC region are focused on building the institutional architecture required to achieve sustainable development

o The world is facing a real crisis in multilateralism and of lack of confidence. In the face of weakening multilateralism and a return to protectionism, the regions must move toward reliable and predictable funding required to meet the SDGs

o LAC is facing some critical challenges including a shift in funding and a decline in trade

o Cooperation and partnership have to be built on mutual respect and benefito Some countries have improved on the level of poverty but not on inequalities o We need to redefine policies and criteria for NSC, SSC and TrC because the

world has changed. We also need new metrics that incorporate the multidimensionality of development

o We can close gaps by mobilizing resourceso MICs need a cooperation strategy and it should include Agenda 2030 o Building institution beyond tradition scope

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o Cooperation should always based on BAPA principles, i.e. mutual respect and benefit

Q&A: Qatar

o SSC and TrC play a critical role in trade and the fight against poverty, particularly among MICs

o Cooperation is an essential part of Qatar’s foreign policy, which also continues to attach great importance to ODA

o We can improve relationship between developed and developing countries. Qatar has hosted many summits and meetings

o Look forward to participating in the BAPA+40 meeting Argentina

o It is essential to renew cooperation agreements with developed countries and traditional donors

o Many MICs play a key role through exchanging of experiences and together they have contributed to resolving various development challenges

o TrC represents an innovative mechanism that allows developed countries to shoulder their historic responsibilities

Costa Ricao The categorization criteria should go beyond GNI and GDP o Costa Rica will support and strengthen the SSC platform and looking forward

to the BAPA+40 conference in March Uganda

o SSC is a strategic tool for development and it has moved to the center stage of global economy

o Reemphasized on: Role of regional organizations including ECA and ECLAC The positive impact of remittances Taking advantage of frontier technologies Paradigm shift is important

Moderator’s conclusionso The increased number of MICs may give a distorted image of the level of

development – we are seeing an increased number of people living in poverty and higher levels of inequality

o SSC is not to be done just among MICs. We need to explore new forms of cooperation such as on debt, tax, transparency issues

o Classification measurements should include fundamental factors and go beyond GDP

o We need to look for new forms of SSC and TrC which can humanize cooperation. The UN has a fundamental role to play in harnessing cooperation as a strategic tool for development

o The Regional Commissions have a fundamental role to play – today’s discussion showed that different regions such as Africa and LAC face common realities

Plenary Segment European Union

o EU is the world’s largest ODA provider and in 2017 its contribution made up 57% of global ODA

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o Driven by the 2030 Agenda, EU is also committed to strengthen cooperation with MICs

o The EU emphasizes better-tailored partnerships with a broader range of stakeholders and partner countries

o MICs includes diverse countries and EU would like to cooperate with all of them

o Modalities: Exchange of knowledge Promote TrC Financial instrument such as blending

o Urged MICs to be more flexible and responsive when using EU’s resourceo Widening MICs’ tax base and increasing tax revenues, many MICs will be

able to close the financing gap for reaching the Goals in areas such as education, health, electricity, roads and water

o The European Investment Plan is an important initiative to leverage additional resources, primarily from the private sector, into sustainable development and growth

Costa Rica o/b Like-Minded Group of Countries Supporters of MICs o MICs classification oversimplifies the complexities of the countries within

this designation and does not reflect the varied situations requiring tailored engagement from the international community

o Urged the UNDS, as part of its reform process, to set forth a comprehensive long-term strategy across the system to coordinate support to MICs

o It is important to address the MIC’s most imperative needs as they move to achieve the Goals and other internationally agreed objectives

o Emphasizes the importance of knowledge-sharing platforms and the pivotal role of SSC and TrC for these countries, who play the double role of providers and recipients of cooperation

o Concerned that the graduation process does not let these types of financing be maintained for countries that shift from one level of income group to another

o Stressed the need to increase and ease MICs access to development and climate financing to support national development plans and development objectives

o Also pointed out that International public finance is still a powerful tool for complementing these countries’ efforts to mobilize public resources domestically to achieve sustainable development

Antigua and Barbuda o/b CARICOMo Stressed the need to reduce remittances transfer costs; the importance of

technology; the need to strengthen the collaboration between public and private sectors

Belaruso MICs have played a key role in helping achieve the MDGso UN does not have a singular approach to assist MICs. Called for clarity on UN

efforts to implement the Leave no one behind principleo Advocated for a long-term and comprehensive strategy and welcomed the fact

that some organizations within the UN system, such as UNIDO, are waking up to the needs of MICs

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o Urged the UN to set multi-dimensional indicators in the economic, social and environmental field

Panamao International cooperation should adopt multi-dimensional criteria that go

beyond GDP o MICs continue to have structural, environmental and economic gaps o Urged to adopt Multidimensional poverty indicator

Cambodiao Cambodia’s pro-growth economic policies and comprehensive reforms have

led to impressive achievements including the increase in GDP and the decrease in poverty rate

o Challenges: slow diversification of the economy high logistical costs shortage of skilled labor

o It is important to enhance technology cooperation and increase budget on education

o Trade is also important to advance countries’ social and economic development

Peruo Many MICs are vulnerable to climate change o Peru is a country that is open to trade and export commodities o Stressed the need for multilateralism and cooperation o Underscored that the international community shares a responsibility to

eradicate poverty o Promoted greater technology transfer o Pointed out the necessity to bridge gaps and curb illicit financial flowso Underscored addressing corruption, promoting gender equality and financial

inclusion Maldives

o MICs’ vulnerabilities are manifested in economic, environmental and structural dimensions

o The new Maldives’ strategy is to build the country’s national resilience and mitigate vulnerabilities

o Need international support to create a conducive environment to attract investors

Pakistano The highest priority is to eradicate poverty o Stressed that a one-size-fits all approach cannot worko The cooperation between China and Pakistan provides a good example of SSCo Stressed also the importance of traditional donors

Trinidad and Tobagoo Stressed development challenges including limited access to international

market o Urged UN to adopt multidimensional parameters such as vulnerability index o Reiterated that SSC is a complement to NSC

Colombia

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o Believed that the current classification methodology of the development levels of countries based on income per capita does not respond to 2030 Agenda. It is urgent to adopt a new and integral vision to measure the levels of development

o Colombia designed 2018 and 2022 national development plan aligned with SDGs

o SSC and TrC offer an opportunity to enhance horizontal cooperation, which contributes equally to the achievement of the SDGs, recognizes our learning and highlights the differentiated capacities and knowledge that we can share as high income countries.

o No one size fits all o Emphasized that SSC is a valuable tool to exchange experience and

knowledge Barbados

o Classification as MICs jeopardizes the development prospects of Caribbean SIDS: little access to global market increased the difficulty to diversify productions and services; little access to grant or concessionary financing

o Hard to generate tax revenues that are needed to finance development activities because Barbados’ population and business are too small

o ODA and FDI to Caribbean have contracted o Called for:

Adoption of UNDP’s recommendation against the abrupt cut off from concessionary and grant financing on attaining MIC status

The use of a Structural Gap Approach as advocated by ECLAC Greater flexibility and broader criteria for determining access to capital The support of the international community for the SAMOA Pathway

Chinao MICs and developing countries are sharing challenges including food security,

the changing climate and technological progresso Strong support from the international community is needed for MICs’

development. Donors should work hard to fulfill ODA commitments o China supports multilateralism and defends the multilateral trading system as

well as efforts to safeguard the interests of all. China has hosted summits and meetings to promote multilateralism

Romaniao Believe in the Leaving no one behind principleo Advocates for shared responsibility, solidarity and collective actiono 2018 Voluntary National Review proved Romania strong commitment to

multilateralism, sustainable development and human rightso Introduced Romanian achievements including decreasing poverty rate and

unemployment rate and increasing GDPo Stressed Romania’s vulnerability to natural disasters which resulted in more

than $3.5 billion in direct damageso Pointed out that building resilience to climate change and natural disasters is a

long journey and it calls for good policies, effective coordination at different levels of government and across sectors, and mobilization of significant financial resources

Mongolia

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o Poverty is the biggest challenge for Mongoliao Mentioned that Mongolia has experienced an increase in economic growth,

improved fiscal integration and strong fiscal disciplineo Highlighted the importance of SSC and of the International Think Tank for

Landlocked Developing Countries o It is essential for MICs to mobilize development financing, improve

competitiveness, maximize trade potential, facilitate access to technological transfer and strengthen partnership and capacity building towards successful implementation of the 2030 Agenda

Norwayo MICs bring know-howo We should avoid hard cut-offs from the concessional finance tools availableo Promised to support strengthened mechanisms to ensure greater level of

climate resilience because many MICs are vulnerable to climate changeo Stressed the importance of the private sector; MICs’ development tools should

be used more flexibly to fit this sector’s needso Norway will continue to be a large contributor of ODA but the use of

assistance must be catalytic. Development aid should unleash new forms of finance

o Emphasized on creating resilient infrastructure and institutions in MICs, especially in the phase that the transfer of knowledge and technology is needed

o Encouraged MICs to reform and reposition their public sectors especially tax system

Kyrgyzstano SDGs implementation is one of Kyrgyzstan’s priorities o Stressed the importance of regional cooperation in the realization of SDGs o Shared progress on achieving SDGs

Closing SegmentPGA closing remarks:

The Assembly heard about their needs and the necessity of overcoming the use of a single metric to classify the many different economies

The session laid out the issues the MICs are facing as they try to eliminate poverty and hunger. These issues include the consequences of climate change, their dependence on commodities exports, their vulnerability to foreign exchange rates and capital flows

The SG will use this valuable information to present a report at the GA 74th session on the implementation of resolution A/RES/72/230

Reaffirmed that UN is committed to developing a comprehensive and cohesive view that helps MICs reduce poverty in all its phases.

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