Annex D
DEVELOPMENT COMMITTEE COMMUNIQUE,
25 SEPTEMBER 2005, WASHINGTON DC
1. We met against the background of a series
of major meetings in this "Year of Development," in
particular the United Nations 2005 World Summit held in New York
on September 14-16. These meetings, including the G8 Summit held
in Gleneagles in July, have resulted in significant progress in
building and deepening consensus on key elements of the development
agenda. In our discussions we focused on implementation and priorities
for action.
2. We reiterated our support for the realization
of the internationally agreed development goals, including the
Millennium Development Goals (MDGs), and recognized that this
calls for a stronger international development partnership. We
are encouraged by commitments to reinvigorate the aid partnership,
with stronger policies in many developing countries matched by
commitments by developed countries and other donors for significant
additional aid and debt relief and steps to improve development
effectiveness. We reaffirmed the importance of sound policies,
including promoting a strong private sector and improving governance,
in developing countries to the achievement of the development
goals. In this connection, we emphasized the importance of expanding
opportunities for those who have the least voice and the fewest
resources and capabilities. We welcomed the increased resources
that will become available as a result of the recent establishment
of timetables by many donors to achieve the target of 0.7 percent
of GNP for ODA. We commended donors who have already reached or
exceeded this target. As called for by world leaders at the recent
UN Sunimit, we urged those developed countries that have not yet
done so to make concrete efforts in this regard in accordance
with their commitments. We noted the launch of the International
Finance Facility for immunization and the upcoming implementation
of an airline ticket solidarity tax by a group of countries. We
called on the Bank to assist with implementation issues, as appropriate,
to ensure that these initiatives are coherent with the overall
performance- and country-based aid architecture. We also noted
ongoing work on blending arrangements and advance market commitments
for vaccines.
3. As important as mobilizing more aid is action
to improve the quality of aid. We welcomed progress toward establishing
tangible indicators and targets for commitments made in the Paris
Declaration on Aid Effectiveness. We asked the Bank to work closely
with the OECD Development Assistance Committee and other partners
to support the delivery and improve the quality of increased assistance,
through systematic monitoring and follow-up on aid commitments,
and through vigorous implementation of the agreed agenda on managing
for results, harmonization, and alignment.
4. We welcomed the World Bank Group's ambitious
Africa Action Plan, which will support African countries in their
efforts to increase growth, tackle poverty, and achieve the MDGs.
We called for timely and vigorous implementation of the Plan and
urged that the Bank work closely with the African Union, New Partnership
for Africa's Development, African Development Bank, African Partnership
Forum and other partners. We commended the Plan's results-oriented
approach and the concrete actions it proposes to ensure that increased
aid will be used effectively. The Action Plan correctly focuses
on building state capacity and improving governance; strengthening
the drivers of growth; and promoting broad participation in growth
and sharing its benefits. We commended its comprehensive approach
toward developing an African private sector, creating jobs, enhancing
exports, expanding infrastructure, raising agricultural productivity,
strengthening human development, building capacity (including
in conflict-affected and fragile states), and increasing regional
integration. Related areas we emphasized include strengthening
the implementation of Education for All Fast Track Initiative,
including closing of the financing gap; stepping up the fight
against major diseases including HIV/AIDS and malaria; promoting
women's role in development; and improving the environment for
small and medium enterprises, including access to microfinance.
We called for further analysis and elaboration of proposed new
mechanisms to scale up and strategically target aid to countries
and programs with potentially high development impact, which are
complementary to and consistent with IDA framework. We also welcomed
the Plan's emphasis on partnerships, monitoring and evaluation,
and consultative mechanisms, including reporting back to the Committee
on progress on a regular basis in the context of the Global Monitoring
Report, starting in 2007.
5. We
welcomed the G8 proposal for 100 percent cancellation of debt
owed by eligible heavily indebted poor countries (HIPCs) to the
International Development Association (IDA), the African Development
Fund (AfDF), and the International Monetary Fund, as providing
a valuable opportunity to reduce debt and increase resources for
achieving the MDGs. In order to expedite the implementation of
the proposal, we agreed on the need for an interdependent package
consisting especially of dollar for dollar compensation for IDA
that is truly additional to existing commitments and that maintains
the financial integrity and capacity of IDA to assist poor countries
in the future. We are agreed on the need for additionality of
donor resources for debt relief to provide tangible benefits to
HIPCs. We are confident that the package, including financing,
the main technical features of the proposal and burden sharing
on a voluntary basis will provide these benefits. We emphasized
the importance of maintaining sound economic performance and good
governance by eligible countries. We urged donor countries to
ensure financing to fully compensate IDA for forgone reflows resulting
from debt relief in order to reach a final agreement on the proposal.
We welcomed the delivery commitments by the G8 in their letter
to the World Bank President. We asked the Bank to prepare a compensation
schedule
and monitoring system of all donor contributions
urgently. On this basis we expressed our support for the aforementioned
package and urged the Bank to proceed with the steps to ensure
all necessary arrangements for implementation.
6. We also reviewed the implementation of the
HIPC Initiative, welcomed continued progress in providing debt
relief to HIPCs, noted the need to fill the current funding gap,
and urged full creditor participation. We continue to underline
the importance of the existing agreement that contributions under
the FIIPC Initiative be additional to other contributions to IDA.
Eighteen countries have reached the completion point and another
ten are between decision and completion points. We look forward
to a final list of eligible countries in early 2006.
7. Stronger country policies and more and more
effective aid must be complemented with ambitious moves to increase
openness and market access and to ensure that trade benefits the
poor. Without a timely and ambitious outcome for the Doha Development
Agenda, developing countries will not achieve the economic growth
needed to meet the MDGs. As we approach the crucial Hong Kong
Ministerial meeting, which will be an important milestone toward
concluding the Doha Round in 2006, now is the time for action
by all WTO members to move the negotiations forward, and we called
upon developed countries to show leadership. We cannot overemphasize
the importance for the global economy and for meeting the MDGs
of achieving an outcome that includes: (i) a major reform of agricultural
trade policies to expand market access and eliminate trade-distorting
subsidies; (ii) action to open markets in manufactures and services;
and (iii) increased aid for trade to address supply-side constraints
and enhance the capacity of developing countries to take advantage
of expanded trade opportunities. We endorsed the proposal for
an enhanced Integrated Framework for Trade-related Technical Assistance,
including expanding its resources and scope and making it more
effective. We asked the Bank and the Fund to examine further the
adequacy of existing mechanisms to address regional or cross-country
aid for trade needs and explore new mechanisms as appropriate.
We supported a strengthened framework for assessing adjustment
needs so that IFI and donor assistance mechanisms can be better
utilized. We urged the Bank and the Fund to better integrate trade-related
needs into their support for country programs. We also asked the
Bank and the Fund to continue their global advocacy role on trade
and development.
8. Scaling up investment in infrastructure, alongside
strong programs for education and health, is key to faster growth
and progress in reducing poverty. We welcomed the progress made
by the Bank Group in implementing the Infrastructure Action Plan
and strengthening public-private partnerships to leverage investment
and maximize impact, including in the framework of the newly established
Africa Infrastructure Consortium. We called for continued deepening
and scaling up of support for infrastructure service delivery,
and removal of impediments in this regard, in order to respond
to needs in both low- and middle-income countries. As part of
this effort, we look forward to a progress report at our next
meeting by the Bank on the impact of fiscal space on growth and
achievement of the MDGs, in continued cooperation with the Fund
on the macroeconomic aspects of this issue.
9. We welcomed the review of World Bank conditionality
and endorsed the good practice principles the Bank has put forward
to streamline conditionality and strengthen country ownership
and leadership. We called for regular monitoring to ensure their
consistent implementation at the country level and for a report
on progress next year. We also welcomed the work on enhancing
IMF instruments in support of its low-income members, and called
for further strengthening Bank-Fund collaboration in this area.
10. We welcomed the joint Bank-Fund review of
the poverty reduction strategy approach and noted the contribution
the PRS approach is making to enhancing country leadership of
the development agenda, promoting the articulation of clear and
coherent country policies and priorities for spurring growth and
reducing poverty, improving budget and monitoring systems, and
sharpening the focus on development results. We noted that country
ownership based on broad participation is now central to the PRS
approach. We also noted the value of country-led diagnostics including
poverty and social impact analysis in supporting the PRS approach.
Good progress notwithstanding, continued efforts are needed to
strengthen poverty reduction strategies and their implementation
in many countries. This includes efforts by countries to improve
policies, domestic resource mobilization, governance, and accountability
and by donors to provide support in a predictable, aligned, and
harmonized manner.
11. We support the World Bank's efforts, including
through the Global Environment Facility, to assist member countries
in measures to mitigate and adapt to the impact of climate change
and improve energy efficiency and access to renewable and cost-effective
energy; and welcomed efforts to follow up on the Gleneagles plan
of action with early consultations to identify pragmatic investment
and financing policy actions that can help further the goals of
the United Nations Framework Convention on Climate Change. We
look forward to a report for our next meeting on progress made
in developing dialogue with partner countries and institutions
and a future investment framework.
12. The Committee considers the issue of enhancing
the voice of developing and transition countries in our institutions
to be of vital importance. We will continue our discussions with
a view to building the necessary political consensus on this matter,
taking into account progress in the context of the IMF quota review.
13. The Committee expressed its appreciation
to Mr. Trevor Manuel, Minister of Finance of South Africa, for
his valuable leadership and guidance as Chairman of the Committee
during the past four years, and welcomed his successor, Mr. Alberto
Carrasquilla, Minister of Finance and Public Credit of Colombia.
We expressed our gratitude to James Wolfensohn for his outstanding
leadership of the World Bank Group during the last 10 years, and
welcomed the new President of the World Bank, Paul Wolfowitz,
who attended his first meeting of the Development Committee, and
wished him a successful tenure. The Ministers also expressed their
warm thanks to Mr. Thomas Bernes upon conclusion of his tenure
as the Committee's Executive Secretary.
14. The Committee's next meeting is scheduled
for April 23, 2006, in Washington, D.C.
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