Mr. President of the General Assembly,
Your Excellency, Mr. Hailemariam Desalegn, Deputy Prime Minister of Ethiopia,
Ladies and gentlemen,
At the outset I would like to thank the President of the General Assembly Joseph Wiesse for convening these discussions on this important and very relevant topic of Investment in and Financing of productive Capacities of LDCs.
This morning’s panel on ‘National Development Strategies to Enhance Productive Capacities’ and this afternoon’s panel on ‘Reorienting international support mechanisms towards enhancing LDCs competitive advantage’ were indeed two sides of the same coin.
This morning’s presentation by H.E Dr. Sisouphanthong on Lao People’s Democratic Republic of Lao’s experience including the economic growth it has been witnessing over the past several years gives hope that LDCs, given the right framework, strategic partnerships and strong political commitment can themselves, also grow their economy.
In this regard there is a need to scale up the manufacturing sector which can in turn increase productivity.
The role that the private sector can play in economic growth is an obvious one but at times the enabling environment needed to allow them the space to play that role may need to be better enhanced.
But even as we welcome the role of the private sector and other local communities and authorities, the leadership role that governments play can never be overstated. Here the need for inclusion and participation by all stakeholders remains paramount. So to is the critical role of the international community and development partners in living up to their commitments to increase ODA to LDCs.
The need for ODA to be invested in productive capacity areas of LDCS continues to be a recurring theme, and one that we will continue to hear as we move on towards Istanbul and a new programme of action for LDCs for the next decade.
Investments are badly needed in infrastructure, including power generations, NTIC, human capital development and in agriculture. Bilateral and multilateral donors have provided substantial official development assistance, but funds have not been enough in amounts and effectiveness.
Many LDCs have managed to ensure greater macroeconomic stability. But macroeconomic performance is not a goal in itself. It should contribute to attract more domestic and foreign investments.
LDCs share many common features. But these features may in fact reflect different underlying factors.
There is need to articulate national and international policies and corresponding support measures better targeted to countries’ particular needs and the removal of those specific structural factors that impede their progress.
The link between agricultural productivity and economic growth is an important one that cannot be overstated. It is encouraging to hear in our discussions today that development partners also recognize this and continue to offer their assistance, including in terms of capacity building.
It is evident that investment in the productive capacity of LDCs will need appropriate policy improvement at the national level, in particular in investment regulatory frameworks, which must be supported by equally appropriate and innovative measures at the international level.
International support could include not only increased aid commitment but a change in the composition of aid by making more resources available for development of productive capacities, especially infrastructure and skills. There is also a need to match this with equally; innovative bold initiatives to encourage FDI flows into under-invested LDCs which could include increased funding of multilateral risk insurance agencies dedicated to covering political and non-commercial risk in LDCs.
Public-Private Partnerships are a necessary avenue because neither ODA nor Domestic resources levels will be enough to cover the huge need in investment. Market access schemes should be more comprehensive and lasting, allowing more confidence in investors. Access to financing and skill can spur domestic entrepreneurship. Regional integration is also important to generate larger markets and realise economies of scale.
The discussions today will make a significant contribution to the process leading up to Istanbul and the outcome of Istanbul itself. Indeed, the issue discussed here today will continue to be discussed as move forward towards UN LDC IV.
I commend and thank the PGA President, the panellists and all of you for your commitment and dedication to the LDC cause and congratulate you all for a successful meeting.
I thank you