Integrating Human Rights into the International Financial Architecture Reforms: A Cornerstone for Realizing the 2030 Agenda for Sustainable Development and a Human Rights Economy

Mr. President,
Excellencies,
Colleagues,

Nine years ago, the world came together to map out a bold path for change, equality and justice.

The Sustainable Development Agenda is our shared roadmap towards the world we want: human rights for everyone, everywhere.

But as we live out the rebound effects of profound geopolitical crisis, rising conflicts and a global pandemic, we are swerving way off course.

In fact, we are going backwards.

Inequalities are skyrocketing.

Climate change is burning and pounding our planet.

And the number of people living in severe poverty has risen, for the first time in a generation.

Imagine: a world where 750 million people do not have enough to eat.

Imagine: a world where almost half of humanity – some 3.3 billion people - live in countries where governments spend more on servicing their debts, rather than ensuring children are in school or that people have access to affordable healthcare.

This is not a prediction of some dystopian future. It is a dystopia we are living today.

Eighty years ago, the international financial system was set up to protect the world from deep economic and financial crisis.

But today, the system is broken.

In the wake of the pandemic, countries are drowning even deeper in debt.

Developing nations carry the biggest burden. They pay interest rates up to eight times higher than developed countries, pushing them into debt distress.

Yet there is still no multilateral legal framework which could ensure sovereign debt crises are resolved fairly, swiftly, and effectively.

The result? Strangled by debt servicing commitments, many countries are simply unable sufficiently to invest in human rights and the Sustainable Development Goals.

We must avoid these debt traps becoming even bigger death traps.

We must also tackle rampant global tax abuse. A staggering 480 billion USD is lost each year to tax evasion and avoidance by powerful multinational corporations and the superrich. For developing nations, the equivalent of half of their public health budgets is being drained, robbing them of the capacity to invest what they need into human rights, particularly economic, social and cultural rights.

Excellencies,

The UN Secretary-General has called, repeatedly, for a fundamental overhaul of our dated and unjust international financial system.

Infusing the values and protections provided by human rights into this overhaul is critical.

Speaking in concrete terms, I suggest six points of action.

First, we need a massive injection of financial resources to get the Sustainable Development Goals (SDGs) back on track. But this must focus on providing concessional financing, or loans with much lower interest rates and longer and fairer borrowing terms. Financial support must enhance all States’ capacities to invest sustainably in all human rights, including economic, social and cultural rights and the right to development.

Second, urgent reforms of the governance of international financial institutions, including the World Bank and the International Monetary Fund, must also transform their economic paradigm. To firmly anchor macroeconomic policies and financing decisions in human rights. To put an end to policy ‘conditionalities’ that disregard a State’s human rights obligations or impacts of a State’s policies on the enjoyment of human rights. And to update policy and practice to consider human rights and inequality impact before and after financial operations, loans and investments to help ensure these institutions proactively support, rather than impede, the achievement of human rights and the SDGs.

Third, we must address debt distress. This means tackling the high cost of debt. And it means a more effective process for restructuring unsustainable sovereign debt, taking into account States’ international human rights obligations.

Fourth, an update of the principles of responsible borrowing and lending, including by private creditors, to better reflect human rights. We must advance towards a multilateral legal framework under which States would be encouraged – not penalised - when boosting their social spending. ‘Debt sustainability’ analyses should reflect the need for adequate fiscal space to secure access to health, education, social protection and other rights, giving priority to fulfilling these rights over paying external creditors.

Fifth, a redesign of the global tax architecture to make it fairer and more inclusive. The initiative proposed by the Africa Group, just adopted by the UN General Assembly, is an important step in this direction, advancing towards the development of a legally binding Framework Convention on international tax cooperation.

And sixth, a fair and just global economy means a reform of global tax rules that will increase the resources governments can mobilize domestically. By ensuring that multinational corporations pay their fair share of taxes in all the countries where they operate. By elevating the global minimal income tax rate to thwart the ‘race to the bottom.’ And by promoting financial transparency, integrity and accountability, including through public reporting of corporate profits and curbing tax-related illicit financial flows to tax havens. It also means national economies with more efficient and transparent tax regimes and progressive tax policies on income and wealth.

Excellencies,

It is time for a profound shift in our approach to economic policies. It is time to integrate human rights into the heart of the international financial architecture.

It is more than time to implement human rights economies in all parts of the world.

These are economies which place people – their human rights, including their economic, social and other rights – at centre stage.

Economies which prioritise the health of our planet.

Where people are empowered to participate in decision making processes that affect them.

Where resources are more fairly distributed, reducing poverty and inequalities.

And where we can be finally lifted out of our silos, in the acknowledgement that the realisation of human rights is the responsibility of us all, and requires international cooperation, assistance and solidarity.

The Sustainable Development Goals embody a united vision of human rights and development.

I sincerely hope we can rise above the challenges and work – together – to urgently bring our vision to fruition.

And guarantee, at last, that no-one is left behind.

I look forward to hearing the results of your conversations today.

Thank you.