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Addis finance talks: asking all the right Questions, but few answers so far, says Christian Aid

July 16 2015 - The Addis talks on how to pay for poor countries’ development asked all the right questions but failed to provide clear answers to some of today’s most pressing global issues, Christian Aid said today.

After the United Nations Financing for Development conference in Addis Ababa closed last night, the charity acknowledged that the final text contained some positive elements.

These included references to the importance of greater corporate transparency, recognition of the challenge that inequality presents to development, and an encouragement to countries to track and report aid allocations that bolster gender equality and women’s empowerment.

The outcome document also saw the establishment of a formal mechanism to follow up on discussions in Addis, which is a step forward from previous conferences.
 
Christian Aid saysd the challenge now is to turn words into action. "These are important foundations on which governments must keep building if there is to be adequate finance to ensure that the new Sustainable Development Goals are implemented in a way which leaves no one behind," said Toby Quantrill, Christian Aid's Principal Adviser on Economic Justice.

Final negotiations on the new Goals resume on Monday in New York. “The agenda discussed in Addis includes some of the most pressing concerns the world faces,” said Mr Quantrill.

“Establishing effective, global, systems for dealing with tax, debt and trade, and linking these concerns with sustainable development results and human rights frameworks has never been more important – and not just for the poorest countries as the situation in Greece shows. It is critical that governments now use the newly established mechanisms to follow up this agreement with clear commitments to specific actions.”

He added, however, that the Addis conference was "a victory for vested interests", as far as potential reforms against multinational tax dodgers and rights abuses are concerned.

“The creation of a new United Nations Global Body on tax was one of the most contested issues in Addis. It is the world's best chance of moving toward the fundamental changes needed to stop multinationals dodging tax.
“But rich countries, including the US and UK, fought any significant change to the status quo, whereby global tax rules are made overwhelmingly by the OECD - a club of rich countries.

“Instead they proffered more help to poor countries fighting tax-dodging multinationals, with the Addis Tax Initiative, which offers to double existing support to strengthen their tax collecting systems. This is certainly of value, but is no substitute for the major reforms that are essential to close loopholes and provide rules that actually work for the poorest.”

Alvin Mosioma, Executive Director of the Tax Justice Network Africa, a Christian Aid partner, said: “This came down to power. The powerful simply did not want to cede one ounce of their authority to the rest of the world, and they succeeded in preserving their control.”

Christian Aid joined with ActionAid, Oxfam and Save the Children this week in criticising the UK government for apparently blocking the creation of the global tax body. At the same time, Christian Aid recognises that the UK Government has met its commitments on development aid, and urges other governments to do the same.

The Addis outcome document saw new emphasis placed on the importance of private financing. Matti Kohonen, Christian Aid's Principal Private Sector Adviser, said: “It endorses the UN Guiding Principles on Business and Human Rights, ILO labour standards and environmental treaties, but we have lost an opportunity to create binding commitments on human rights and labour rights and environmental treaties.

“Instead there is misplaced optimism about incentivising investments based on subsidy schemes such as public-private partnerships (PPPs) that do not have a proven track record or clear accountability mechanisms to contribute towards sustainable development.”

The outcome document also failed to mainstream women’s rights beyond economic participation by ignoring the importance of fiscal and labour policies in addressing wider issues such as unpaid domestic and care work. 

And the summit also did not go far enough in failing to call for the removal of fossil fuel subsidies – a source of finance that could and should be taken out of high-emission sectors to allow greater investment in sustainable development.  

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