FINANCIAL TURMOIL COULD TRIGGER DEVELOPMENT CATASTROPHE, UN CAUTIONS

As leaders of the Group of 20 (G-20) nations gear up for their meeting tomorrow, the United Nations is warning that the current global economic crisis threatens to unleash a human development catastrophe in the world's poorest nations.

Secretary-General Ban Ki-moon will press participants at the London gathering for urgent collective action to boost development and allow people to keep their faith in their future, spokesperson Michele Montas told reporters today.

Mr. Ban, who held bilateral meetings with Indonesian President Susilo Bambang Yudhoyono and the United Kingdom's Foreign Secretary, David Miliband, is expected to warn the leaders tomorrow that the global recession hurts everyone, but especially the poor, who in some countries spend up to 80 per cent of their incomes on food.

The UN Development Programme (UNDP) has also called on the heads of the G-20 nations to recognize that those most vulnerable to the crisis – which is not exclusive to Europe or the United States – are living outside the spotlight.

Those attending tomorrow's event "should recognize the human development calamity facing the people of the poorest countries and commit the resources to bail them out," said Ad Melkert, UNDP Associate Administrator.

Remittances have slumped, trade has collapsed and commodity prices continue to be volatile, plunging more families into extreme poverty and increasing mortality as a result, UNDP said. A 3 per cent drop in gross domestic product (GDP) for developing countries leads to between 47 and 120 more infant deaths per 1,000 live births.

The crisis is a "matter of life or death for many people in the poorest countries," Mr. Melkert said.

"While the economic recovery may start in 2010, the damage to human development will be severe and social recovery may take us several more years," he noted, adding that the impacts may be felt as far away as 2020.

The official also pointed out that in past recessions, poorer nations have suffered disproportionately compared to their wealthier counterparts, witnessing falls in health and education indicators. Life expectancy, school enrollment and graduation rates all drop, and in low-income countries, women, children and society's poorest segments are most likely to bear the brunt of the economic collapse.

Also warning about the impact of the financial crisis on schooling was Koïchiro Matsuura, Director-General of the UN Educational, Scientific and Cultural Organization (UNESCO), who called for greater investment in education.

According to research, extending the average period spent at school by one year will boost per capita GDP by 4-6 per cent, he said. "By injecting resources into education now, not only would we stimulate economic recovery, but we would also contribute to stronger growth in the future and guarantee global stability in the long term."

For its part, the UN International Fund for Agricultural Development (IFAD) has called on governments to accelerate agricultural development, with the financial downturn pushing millions of people – especially poor rural people – into abject poverty.

"We ignore the world's poor farmers at our peril," said IFAD President Kanayo F. Nwanze. "As we strive to recover from the current turmoil, these farmers can be part of the solution."

Given the necessary support, they can drive economic growth and help the world to avert food crises, like the one that shook the world in 2008, he said.
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UN-BACKED FUND NEEDS ADDITIONAL $4 BILLION TO FUND AIDS, TB AND MALARIA EFFORTS

The question of how to fill an estimated $4 billion funding gap in the United Nations-backed initiative that helps countries fight AIDS, tuberculosis and malaria needs to be urgently addressed, donors at a meeting in the Spanish city of Cáceres stressed today, as they wrapped up a review of resource needs.

The Global Fund to Fight AIDS, TB and Malaria – which helps finance national AIDS programmes – estimates that donor funding for the period 2008-2010 stands at $9.5 billion, $4 billion short of the expected demand of at least $13.5 billion.

"In view of the funding gap and the impact of a global economic crisis on the developing world, the Global Fund looks forward to how leaders of G-20 [Group of 20 most industrialized] countries address this situation at their summit in London on 2 April," said Michel Kazatchkine, the Global Fund's Executive Director.

He added that the Group of Eight (G-8) leaders will also address the same challenge when they meet in La Maddalena, Italy, in July.

Delegates gathered in Spain for the two-day Mid-Term Review meeting of the Global Fund's Second Voluntary Replenishment process said much of the additional resources needed by the Fund would have to come from donors who have committed to increasing their official development assistance (ODA) budgets in order to meet development financing targets set at a international conference in Monterrey in 2002.

The participants, representing 28 donor countries and foundations, also called on the Global Fund to step up efforts to seek new government donors and attract more private sector contributions, according to a news release issued by the Fund.

Several donors indicated that they would soon consider making additional contributions in response to the success achieved by Global Fund programmes. The last two years have seen reductions in mortality in a number of countries for AIDS and malaria, and a continued fall in global TB prevalence that was first noted in 2004.

"We are now affecting the course of these three epidemics. In the case of malaria, in particular, we are on a trajectory to achieve universal access to bed nets by 2011 and have reason to be hopeful the Millennium Development Goal for malaria can actually be reached," said Mr. Kazatchkine, referring to one of several development targets set by world leaders in 2000.

He added that steps were being taken to ensure efficiency gains in the Fund's grants and in the Secretariat in areas such as travel, telecommunications and corporate procurement of goods and services.
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UN JOINS GLOBAL TASK FORCE TO CREATE NEW ‘GREEN’ ECONOMY

United Nations officials will begin work with a task force, launched today in London, charged with developing a set of practical projects and policy proposals to stimulate a new low-carbon global economy.

The initiative comes in response to an invitation made by United Kingdom Prime Minister Gordon Brown at the annual World Economic Forum Summit in Davos, Switzerland, in January to create an unprecedented low-carbon prosperity task force.

Some 52 businesses and 34 experts and organizations have joined the task force, which will work with governments and organizations such as the UN Environment Programme (UNEP) and the UN Foundation to identify how to create millions of urgently needed "green jobs" and to steer global economic growth onto a more sustainable, low-carbon direction.

"We believe 2009 is a crucial year for two reasons," Richard Samans, Managing Director of the World Economic Forum, said in an open letter to Mr. Brown ahead of this week's so-called Group of 20 (G-20) Summit in London, which will discuss solutions to the current global economic crisis.

Mr. Samans suggested that by placing low-carbon growth strategies at the heart of economic stimulus measures being injected into many ailing economies, tackling the global recession and achieving a new international treaty on reducing greenhouse gas emissions – to be concluded at the UN-led climate change conference in Copenhagen in December – can be mutually reinforcing.

"The G-20 governments can, politically and practically, signal their determination to transform the current economic crisis into an opportunity by committing a serious part of the multi-trillion dollar stimulus packages to low-carbon investments," said Achim Steiner, UNEP Executive Director.

"In doing so, they will be setting the stage for sealing the deal in Copenhagen, and setting the stage for a resource efficient, innovation-led 21st century green economy. That is what business needs to know and that is what the low-carbon prosperity initiative is calling for," he added.
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LEADERS MUST FOCUS STIMULUS EFFORTS ON JOB CREATION – UN LABOUR CHIEF

The head of the United Nations labour agency has urged governments to aim their economic rescue packages at forestalling a "prolonged and severe" jobs crisis that would lead to a massive increase in unemployment.

UN International Labour Office (ILO) Director-General Juan Somavia issued the call ahead of the meeting of so-called Group of 20 (G-20) summit to be held in London next week, where world leaders will discuss a common response to the current global economic crisis.

Mr. Somavia characterized international coordination to tackle the current global economic crisis so far as weak, adding that "the financial, trade, economic, employment and social roots of the global crisis are interlinked and so must be the policy responses."

An ILO International Institute for Labour Studies report, entitled The Financial and Economic Crisis: A Decent Work Response noted that 90 million new jobs will have to be created during 2009-2010 to absorb new entrants to the labour market and avoid a protracted period of unemployment.

"We need to implement a coherent and coordinated job-oriented recovery strategy, based on sustainable enterprises, as soon as possible," said the ILO head, warning that a delay in stimulus efforts would extend and deepen the jobs crisis, with employment only starting to recover from 2011.

Highlighting a need for global solutions to the crisis, he said that a lack of coordination diminishes the overall effect of stimulus measures, making each individual country reluctant to move faster than its trading partners and intensify the recession.

The ILO report also warned that trade protectionism would further depress world demand and that wage deflation or weaker workers' rights would not only aggravate the crisis, but be perceived as unfair and aggravate social problems.
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ECONOMIC CRISIS COULD TRIGGER POLITICAL INSTABILITY, SOCIAL UNREST, WARNS BAN

As the economic crisis engulfing the world continues to intensify, it could potentially herald political instability and social unrest, Secretary-General Ban Ki-moon said today, calling for a four-pronged strategy to prevent the onset of new catastrophes.

The financial turmoil cannot roll back gains made towards achieving the global anti-poverty targets with a 2015 deadline known as the Millennium Development Goals (MDGs), Mr. Ban told reporters in New York, following a meeting with British Prime Minister Gordon Brown, ahead of the so-called Group of 20 (G-20) meeting next week in London.

"Social recovery will take much longer than economic recovery," he said. "A child taken out of school today will bear the consequences for the rest of his or her life."

The Secretary-General said he outlined a four-point proposal for the G-20 nations – which he has also relayed in a letter to their leaders – during his talks with Mr. Brown.

Firstly, in addition to their own stimulus packages, G-20 nations should commit to support a global stimulus plan, which must be "of a very substantial size, commensurate with the challenge," Mr. Ban said. This package must include assistance for the poorest and most vulnerable countries, long-term public lending from development banks and cash aid to both least-developed and middle-income developing countries.

He also stressed the need to firmly reject protectionism and revive the Doha round of trade liberalization negotiations to allow real benefits to reach developing nations.

Another element of his plan is the 'greening' of the global economy, including in poorer countries, with G-20 leaders committing to conclude negotiations and reach agreement on an ambitious successor pact to the Kyoto Protocol, whose first commitment period ends in 2012, in Copenhagen this December.

Lastly, the Secretary-General highlighted the importance of reforming "global rules and institutions so that they reflect today's economic and political landscape."

He voiced hope that the upcoming G-20 "Summit for Stability, Growth and Jobs" can send a "signal of solidarity and hope to all peoples and countries of the world."

The 2 April gathering in London will be one of several stops on a nearly two-week trip that will also take Mr. Ban to Russia, Qatar, the Netherlands, France and Turkey.
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