Financing for Development Forum 2018 – Update from Day 3 – 25 April

On 25 April 2018, Day 3 of the FfD follow-up Forum 2018 (FfD Forum) trade unions had the opportunity to address plenary. Peter Bakvis, Director of the ITUC Wahsington Office, was lead discussant in the round table on domestic and international private business and finance. Trade unions also participated in discussions on the development impacts of the global trade architecture.

Referring to the 2018 Progress and Prospects report of the Inter-agency Task Force on Financing for Development (IATF), Mr Bakvis highlighted some “key obstacles to obtaining greater support form private business and finance to attain development goals”. The IATF brings together over 60 agencies and international institutions whose work impacts the different components of the financing for development agenda.

Highlighting certain dangers of using development funding to incentivising the private sector he warned “the message can, and often is, interpreted by some national authorities to mean that some international bodies suggest a broad deregulatory agenda, revamping the tax system or inappropriately promoting PPPs, according to the whims of private investors no matter what the impact is on people’s livelihoods, income distribution and the attainment of SDGs”. Mr Bakvis illustrated the worrying trend by referring to the World Bank’s ongoing drafting of its flagship World Development Report which puts forward a policy programme of extensive labour market deregulation (more details here).

In his third and final point, Mr Bakvis noted the lack of adequate accountability mechanisms for private sector engagement. Where labour safeguards do exist, the need for the inclusion of trade unions in their monitoring was highlighted in order to ensure their effective enforcement. Mr Bakvis’ full statement is available here.

Another thematic focus of the day was on trade. The afternoon saw the round table discussion on trade and trade unions also participated in a side event on trade policy. Organised by Our World Is Not for Sale (OWINFS) global network, an ITUC ally in its trade work, this session highlighted how existing trade rules constrain the achievement of the SDGs, including in industrial policy, job creation and access to public services.

The “e-commerce for development” is of particular concern to trade unions as it controversially proposes new rules that would handcuff governments’ ability to regulate the digital economy of the future, while consolidating benefits for high-tech companies. They are notably putting forward cross border data transfers, tax cuts for technology companies through a permanent moratorium on tariffs on e-transmissions, the ability to avoid taxes and regulation through banning local presence requirements and the ability to ban countries from being able to impose pro-development performance requirements including local hiring and technology transfer. This agenda is opposed by trade unions and civil society and was successfully rejected by the vast majority of developing countries at the recent WTO Ministerial.

Richard Amparbeng, the General Secretary of the Public Service Workers Union of Ghana, noted the lack of civil society participation in the negotiation of the Africa Continental Free Trade Area (AfCFTA) which has just been signed by 44 countries in the region. He also highlighted the dangers of the Economic Partnership Agreements (EPAs) with the European Union, which will limit needed structural transformation in Africa to promote jobs and development, such as the need to create value addition in agricultural processing which will increase jobs and security in the region. Diyana Yahana of the Asia Pacific Forum on Women, Law and Development (APWLD) highlighted how trade and investment agreements promote a race to the bottom. Countries compete to attract investment by having the lowest regulation and the cheapest labor. It was noted that these have particularly damaging impacts on women and the achievement of SDG 5 (gender equality).

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