The Tenth Debt Management Conference was organized by the United Nations Conference on Trade and Development. This year’s conference attracted over 350 participants, including senior national and international policymakers, debt managers and experts from around the world. Key issues discussed at the conference include the nature of imminent threats to debt sustainability in emerging and developing economies and relevant policy tools which could be used to prevent debt crisis.
At the opening ceremony, Secretary-General of UNCTAD, Mr. Mukhisa Kituyi said that “Eight years on from the global financial crisis, the world has still not succeeded at shifting gears towards more inclusive and sustainable economic development. The global economy remains in the doldrums. Advanced economies are not pulling their weight, and leading emerging economies, which have been the main driver of global economic growth since 2011, are now struggling. Growth in LDCs, consequently, is also slowing.”
He stated that the core issue of the continued global economic fragility is a growing mountain of debt, where global debt levels rose from US$21 trillion in 1984 to US$142 trillion in 2007. And another US$57 trillion has been piled on top since the global financial crisis, pushing global debt level to an astonishing US$199 trillion by 2014.
In addition, he also pointed out that some emerging economies are also experiencing large increase in corporate debt. Therefore, private sector debt sustainability will be a core factor in accessing sustainable external debt strategies in many developing nations.
The President of Ireland, Mr. Michael D Higgins, emphasized that the old model of living, of extraction and use of resources, of a consumption is based on the assumption of infinite expansion, which posed a threat to the environment and social cohesion in many places in the world. Therefore, he calls for fresh thinking and new institution structures which embrace the concept of sustainable development.
Speaking at the panel of Financing Options for Development, Mr. Zhang Zhiping, the Executive President of the Finance Center for South-South Cooperation, said that the existing financial system has contributed significantly to post-war economic development. However, the system possesses three inadequacies which need to be addressed in the sustainable development era, which are policy conditionality, trade-oriented debt system, and insufficient support to horizontal financial flows between countries of the global South.
Moreover, Mr. Zhang introduced the role of the Asian Infrastructure Investment Bank in meeting the financing gap in the region which was estimated to be US$800 billion per year until 2020.
The Debt Management Conference is organized by the UNCTAD every two year. The conference aims to provide a regular forum for sharing experiences and exchanging views between governments, international organizations, academia, the private sector, and civil society on current issues in public finance, debt management and debt crisis prevention.