Global Conference Spotlights Financing for Development
The Fourth International Conference on Financing for Development (FfD4), held in Sevilla, Spain from 30 June to 3 July, brought global attention to the critical need for bold reforms in international finance. The outcome document, known as the Compromiso de Sevilla, outlines a number of commitments aimed at bridging the financing gap for achieving the Sustainable Development Goals (SDGs). However, glaring omissions remain, particularly regarding the inclusion of democratic principles and social justice in the global financial system.
Progress on Decent Work, Care Economy and Social Protection
One of the more encouraging aspects of the agreement is its prioritization of decent work, the care economy, and social protection. The Compromiso de Sevilla pledges investment in productive sectors, job creation, skills development, and formalization of informal work. These steps are commendable, as they aim to uplift vulnerable workers and create sustainable employment pathways.
Also notable is the call for an annual US$4 trillion in climate finance, and a measurable target for developing nations to increase social protection coverage by at least two percentage points annually. Backed by the International Labour Organization (ILO), this objective aims to address the fact that nearly half the global population lacks social protection. The agreement also references ILO standards and emphasizes predictable and sustained financing to support countries during crises.
Missing Commitments on Living Wages and Equal Pay
Despite progress, the agreement falls short in other key areas. Most notably, it fails to endorse living wages and equal pay for work of equal value. These are vital tools for alleviating poverty and promoting gender equality. The omission is alarming, especially given the SDGs’ emphasis on inclusive economic growth. Policies on living wages, minimum wage adequacy, and collective bargaining should be central to national development strategies.
Pursuing Fiscal Justice Through Fair Taxation
The declaration includes a commitment to fair and progressive taxation. It advocates for just tax systems, improved transparency, and ensuring that multinational corporations and the ultra-wealthy contribute their fair share. Though the language supporting a UN Framework Convention on International Tax Cooperation is softened, the agreement still encourages steps toward a global tax convention—a vital tool for combating tax evasion and fostering fiscal equity.
Reforming Global Debt Architecture
Debt sustainability and reform of the global debt architecture were among the most debated topics. The agreement commits to launching an intergovernmental process under the UN to address existing gaps in debt mechanisms. Trade unions are advocating for the creation of a permanent multilateral debt resolution framework, aligned with the 2015 UN General Assembly resolution on sovereign debt restructuring. Such a mechanism should enable comprehensive debt relief, including cancellation and restructuring, without imposing austerity measures that undermine social and economic recovery.
Challenges with Private Finance
While the agreement acknowledges that private finance hasn’t prioritized sustainable development, it continues to lean on mobilizing private capital and blended finance. The document lacks robust accountability mechanisms to ensure these resources align with the SDGs. For private finance to genuinely support development, actors must adhere to ILO standards, conduct due diligence, and practice responsible business conduct. A binding UN treaty on multinational corporations and human rights is urgently needed to hold private entities accountable.
Development Cooperation Without Clear Targets
The reaffirmation of Official Development Assistance (ODA) is positive, but the absence of concrete, time-bound targets is concerning. Amid global aid cuts, it is imperative to define clear benchmarks and establish strong accountability frameworks. ODA should be strategically allocated to support SDG 8, which includes decent work, social protection, equality, lifelong learning, and employment for youth and migrants.
Labour Rights Absent in Trade Commitments
Another major shortcoming is the failure to integrate labour standards into World Trade Organization (WTO) rules. The International Trade Union Confederation (ITUC) has long called for ILO core labour standards to be embedded in trade regulations. Such integration would ensure that trade policies uphold workers’ rights and do not undermine labour protections. Moreover, the agreement misses an opportunity to reform investor-state dispute settlement mechanisms, which often prioritize corporate interests over public welfare.
Weak Responses to Climate and Systemic Crises
The agreement’s approach to climate finance and systemic shocks lacks ambition. It does not commit to phasing out fossil fuel subsidies or reallocate Special Drawing Rights (SDRs) to address global crises. While it acknowledges the need for governance reforms at the International Monetary Fund (IMF) and World Bank, it fails to establish meaningful accountability frameworks. This lack of oversight is particularly troubling, given the often harmful policy prescriptions issued by these institutions.
A Call for Democratic and Equitable Reform
The ITUC welcomes various elements of the Compromiso de Sevilla that align with long-standing labour demands. However, much work remains. The organization will continue to push for a more ambitious development finance agenda that places democracy, equity, and solidarity at its core. As ITUC Secretary General Luc Triangle emphasized, “Workers worldwide demand democratic and transparent institutions capable of delivering the New Social Contract. It is time to transform principles into action and promises into policies.”
This article is inspired by content from Original Source. It has been rephrased for originality. Images are credited to the original source.