The Prime Minister of Antigua and Barbuda Gaston Browne has said that the current per capital income criterion for measuring development, and the attendant graduation are deeply flawed and must be overturned to provide middle income countries with much needed access to developmental financing.
He was giving a statement at the opening plenary session of a high-level meeting on middle-income countries in the trusteeship council chambers at the UN headquarter at New York on Tuesday.
He said in his statement that “My country is one of the smallest and most vulnerable in the world. Yet, because of skewered construct of what represents development, particularly the criterion of per capita income, my small island state is disqualified from access to concessional loans and grants”.
“Other middle income nations face this same predicament. The absurdity of the situation, is that our peoples are being graduated or more appropriately, punished for two things: first, their adherence to political and human rights, that have rewarded their workers with better incomes; and second, the openness of our economy to foreign investment.”
“The openness to foreign investment results in the abnormally high repatriation of profits and higher salaries to a small group of expatriates, that distort genuine per capita income.”
“The time has long passed to reject this palpably false basis of judging a country’s wealth or its level of development.”
“If it continues to persist, guiding the way middle income countries are treated, we will witness a steady decline in economic fortunes with resultant social dislocation and political upheaval.”
“Not only will we fail to achieve the UN’s Sustainable Development Goals, but the progress we have made will be reversed. In fact, that trend has already started. I remind this gathering, that the significant problems confronting many middle-income countries, particularly small island developing states, are externally generated or influenced.”
“Our countries did not create Climate Change and Global Warming. Yet, we are their greatest victims, and coping with them, simply to survive, is depleting our Treasuries; depriving us of the means to build infrastructure, improve education and health care, alleviate poverty and apply technology that would raise us to a higher level of development.”
“Similarly, we do not create cancerous global financial crises, that infect the world community, especially our small, open economies.”
Yet, we are compelled to deal with the malignant effect of these crises, and to overcome them, as best we can, by our own ingenuity.
And, it is significant, that, as we seek to diversify our economies which are constrained by dependence on a narrow range of productive activities, the rich nations of the world continually block our efforts to compete with them.
Hence in taxation and financial services, a handful of rich nations control and unilaterally enforce arbitrary rules that suit them, instead of allowing universal dialogue and decision in the United Nations.
Development cannot be measured by per capita income alone. Fair trade, access to finance, anti-competition rules, size, debt burden and vulnerability, to include the destructive effects of climate change – all these should be factors in what measures a country’s development.
Add to all this, grave threats posed to our countries’ continued participation in the global financial and trading systems, by the termination or restriction of correspondent banking services to several of our countries, based on the wrongful labelling that we are tax havens and, therefore, ‘high-risk’.
Madam President, I know the picture that I have painted is pretty grim, but as a Head of Government earnestly seeking ways in which to develop my country and my people, there is an increasing sense of frustration that every ladder we climb is kicked away.
Nevertheless, we cannot and will not give up. We are a part of humanity; we are joint inheritors of our one planet; and we intend to persist, to perform and to persevere by being creative, by working hard, by standing-up every time we are knocked-down.
With a unified vision of global development, the international community can help to address the developmental gaps in middle income countries in many ways.
First, it should agree that the current per capital income criterion for measuring development, and the attendant graduation are deeply flawed and must be overturned to provide middle income countries with much needed access to developmental financing.
Second, a genuine methodology must be urgently formulated for determining vulnerabilities and it must include size, susceptibility to climate change, poor terms of trade, remoteness, high cost of transactions, the narrow base of productive activities, and high debt.
Third, concessional financing must be provided to curb the reversals already now in train and to facilitate our efforts to continue the development of our nations.
Fourth, we recommend a global partnership on debt relief. There must be a willingness to write-off or reduce debt, particularly by the Paris Club, especially as, in many cases, it is decades of compounded interest that enlarges the debt. Servicing that debt, amid frequent disasters, persistent diseconomies and external shocks, restrict spending on education, training, new technologies and improving competitiveness, resulting ultimately in underdevelopment.
Fifth, debt for climate swaps to reduce debt burden in accelerating their transition to green energy, to reduce their carbon foot print, improve energy security, climate and economic resilience.
Sixth, encourage the wealthy countries to spend less on artillery in support of senseless wars and useless conflicts; the savings of which should be utilized to advance human development at home and abroad.
And finally, Climate Change must be recognized as the demon that it is. The world’s worst polluters must admit, that it is they who have unleashed this demon, and it is they who must commit to containing and stopping it; not just in words but in deeds, especially by delivering the necessary adaptation and mitigation financing.
Unless such a commitment becomes a binding commandment and Climate Change is halted, no amount of resilience building will help.
Small island states, such as mine, will be among the first victims; but we will not be the last. It is therefore, in the best interest of humanity, that we work collectively, in building a transformational model of cooperation for sustainable global development.
Within the only world body – this United Nations – the consciousness of the world and its collective conscience must act, and act now.
Let us all recommit at this conference, to build an inclusive and sustaining global financial and trade architecture that provides prosperity for all.