G-24 countries call for urgent reform of multilateral system to address global challenges

Saturday, 14 October 2023 01:50 - - {{hitsCtrl.values.hits}}

The Inter-Governmental Group of Twenty-Four on International Monetary Affairs and Development (G-24) including Sri Lanka meeting this week in Marrakech, Morocco, called for the urgent need for reform of the multilateral system to effectively address global challenges.

They noted that the global economic landscape is uncertain, with any countries affected by declining access to and tight external finance conditions, high debt levels and rising inflation. The Group called for a variety of steps to increase the financing available to developing countries. They asked for allocation of new Special Drawing Rights, the IMF’s reserve currency; reform of IMF short-term financing instruments; increased concessional resources to low-income countries; reform of the IMF’s surcharge policy; increased channelling of SDR from donor countries to needy countries and increase of the Fund’s resource base through its 16th General Review of Quotas.

Member countries were of the view that these recommendations would provide additional financing for members to mitigate shocks and invest in climate action and sustainable development.

The G-24 members expressed concern about high and increasing public debt levels, with many developing countries carrying unsustainable debt burden. While members welcome the G-20 Common Framework, they noted that some of the poorest and most vulnerable countries are excluded from the benefits of debt relief. The G-24 called for a durable debt resolution for these countries.

G-24 members expressed their concern with the progress on IMF general quota review. They reiterated their call for the IMF to remain a quota-based institution in order to bolster the voice and representation of emerging market and developing economies, who now account for a larger share of world GDP. Additionally, they recommended further pursuit of governance reforms aimed at correcting regional underrepresentation in the IMF.

While welcoming the World Bank reform program to expand its mandate, better utilise resources, and improve operating efficiencies, G-24 members called for more concessional lending, especially for investments in global public goods and sustainable development such as affordable water and energy.

Members welcome the United Nations Secretary-General’s inclusive and effective tax reform agenda and called for a multilateral consensus to drive enduring progress on the initiative as it would foster a more just and balanced international tax system. On trade, members noted the rising trend in protectionist policies, especially from the largest economies, has adverse repercussions on global integration and trade. They noted that developing countries experience unequal distribution of the benefits of trade, limited market access and unfair trade practices, especially in the agriculture sector, which is often the main source of livelihood for the poor. They therefore called on the Breton Woods Institutions (BWI) to lend their support to reforms of the multilateral trade system.