Asia-Pacific policymakers at a high-level United Nations dialogue in Bangkok today concluded that tax policy and public expenditure management will play a central role in effectively pursuing the 2030 Agenda for Sustainable Development.
Finance ministers, central bank chiefs, senior government officials and experts from 37 countries participated in the Fourth High-Level Follow-up Dialogue on Financing for Development in Asia and the Pacific, co-hosted by the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) and the Government of Sri Lanka from 28 to 29 April.
Opening the two-day meeting, United Nations Under-Secretary-General and Executive Secretary of ESCAP, Dr. Shamshad Akhtar, highlighted three core priorities that have emerged which include the need for governments to enhance their capacity to mobilize and spend public finance resources effectively and efficiently, deliver financing for sustainable and resilient infrastructure by engaging with the private sector, and enhance financial inclusion.
“The financing needs to support implementation of sustainable development are enormous. Asia will need to invest as much as $26 trillion in infrastructure by 2030 and additional investments are needed to improve health care, education, clean drinking water and sanitation; reduce air pollution; and to support job creation in a more inclusive society. Based on this, we count on member States to stock take the progress our region has made, and to develop a financing action-plan,” said Dr. Akhtar.
In his keynote speech, Mr. Ravi Karunanayake, Finance Minister of Sri Lanka underscored that the scope for financing for development depends heavily on the fiscal space and the degree of private participation within each economy, and within the region as a whole. “If we endeavor to minimize differences and bridge gaps in all dimensions at individual levels, it could allow enormous maneuverability for countries in the region to prosper,” he said.
Mr. Tevita Lavemaau, Minister for Finance and National Planning of Tonga further emphasized the importance of engaging stakeholders in mobilizing sufficient financial resources to implement the SDGs. “Collective effort and strong collaboration must also take place between government and all relevant key stakeholders, including tax payers, civil society organisations, private sector and development partners, in order to successfully implement and achieve our sustainable development agenda going forward,” he added.
“For Pacific countries in particular, climate finance is an integral component of development finance. It is essential that we integrate climate finance and domestic finance with traditional development finance to achieve more significant outcomes on our development priorities. Building both physical and fiscal resilience can only add value to our national assets,” said Cook Islands Finance Minister Mr. Mark Brown.
The participants urged for a strong collective response to address tax challenges of the region in view of the 2030 Agenda. They emphasized the need for a broad-based Asia-Pacific platform for policy makers, tax administrators, and relevant regional and subregional organizations to promote dialogue on tax matters. Delegates highlighted the potential of ESCAP to leverage its intergovernmental mechanisms, in close collaboration with development partners, to provide an overarching umbrella for such a platform.
They also noted that a key bottleneck for the growth of public-private partnerships in the region is a lack of capacity in governments, which runs the risk of unfeasible projects being pursued along with inappropriate risk and reward allocation. Continued work in this area is thus essential and the participants welcomed the valuable support provided by ESCAP.
Delegates attending the meeting concluded that moving forward the key priorities should include: strengthening tax systems and administration; increasing the effectiveness and efficiency of public expenditure; deploying tax policies to mitigate inequalities and promote environmental sustainability; strengthening municipal finance to cope with growing urbanisation challenges, including those related to environment, and tackling harmful tax competition, base erosion, profit shifting and other tax avoidance by building broad international and regional partnerships.
In May, the Sri Lankan government and ESCAP will co-host a high-level side event at the ECOSOC Forum on Financing for Development at the UN Headquarters in New York, to present the Chair summary of this meeting. The outcomes will also be presented at the 73rd Commission session of ESCAP to be held from 15-19 May.
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