PM appeals for changes to global financial system

United Nations – World leaders were challenged on Thursday to demand change to the global financial system, so that it will better serve the majority of today’s UN member states.

Prime Minister Mia Mottley spoke extensively about the need to reform the global financial architecture when she delivered Barbados’ national statement to the general debate of the 77th session of the United Nations General Assembly (UNGA 77).

Mottley said multilateral institutions such as the World Bank and the International Monetary Fund “no longer served the purpose in the 21st century that they served in the 20th century” and needed to better reflect today’s realities and make it easier for climate-stricken countries to access capital.

The prime minister re-stated her long-held view that financing for development for small island developing states (SIDS) such as Barbados cannot incur short-term debt and must be replaced by “at least 30-year money”.

“The world recognised this when it allowed Britain to participate in the refinance of its World War I bonds, which were only paid eight years ago, 100 years after World War I started,” she said.

Mottley argued that Germany was allowed to cap its debt payments at the equivalent of 5% of its exports, under the premise that the “cataclysmic” experience of a war was not going to allow them to finance reconstruction while repaying debts incurred during the war.

“We are no different,” she said. “We have incurred debts for COVID-19, for climate, and now to fight this difficult moment of the inflation and [supply crisis].

“Why, therefore, must the developing world now seek to find money within seven to 10 years, when others had the benefit of longer tenures to repay their money?”

As an alternative to the global status quo, the prime minister introduced a concept called, “The Bridgetown Agenda”, which she said was developed between July and August in Bridgetown by civil society leaders and researchers.

“It is that agenda that speaks to the reform of the Bretton Woods architecture,” she said. “We’ve asked and will ask countries and people to join it.”

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