 Welcome everyone, it's just gone half past in the UK so we're going to make a start. Welcome to today's IID debates, hosted in partnership with the International Development Research Centre on managing depth, climate and nature in the pandemic recovery. My name is Juliet and I will be providing some technical support during this session. So with that I am really pleased to introduce Julie Scholdes, who is the Vice President of Strategy, Regions and Policy at the International Development Research Centre and our moderator for today's event. Thanks very much and Julie, over to you. Thanks very much Juliet. Good morning, good afternoon, good evening, and thank you all for joining us today. Bonjour à tous. Merci beaucoup d'être parmi nous aujourd'hui pour la séance que nous avons. As Juliet mentioned, my name is Julie Scholdes, I am the IDRC's Vice President for Strategy, Regions and Policy, and it's a real pleasure to moderate the discussion today. I'm speaking to you from Ottawa, Canada, and would like to begin by acknowledging that the land on which our office is located is the traditional unceded territory of the Algonquin Ashinaabe people. Today's event has a fantastic lineup of speakers. The Honourable Bob Ray, Eunice Jean-Paul Adam, Professor Stephanie Griffiths-Jones, Dev Useri and Sejal Patel, and I'll introduce each of them in a couple of minutes. It's equally a pleasure to be organizing this event with IIED, the International Institute for Environment and Development, one of the world's premier think tanks in the field of climate change and its impact on vulnerable communities in the global south. Before I turn to our first speaker, let me say a few introductory words about why we're here. The International Development Research Center, IDRC, supports researchers in the global south to help address their most important challenges. After the COVID-19 outbreak, we mobilized our resources and are currently supporting some 20 research teams that are analyzing economic policy responses to the crisis. The economic impact of COVID is enormous, as I'm sure you're all very aware. Policy options for lower income countries are extremely limited, which IDRC supported research from ODI and partners has already shown. On top of that, over the last couple of years, countries in the global south have experienced pressure of public or sovereign debt. That was a growing challenge even before the pandemic and the economic crisis that came with the pandemic has intensified it. UN Secretary General Antonio Guterres said this past weekend, the world faces severe problems of debt sustainability in the wake of the coronavirus crisis that have not been properly understood or addressed, and which threatened to tip developing countries into a rising wave of hunger, poverty, social unrest and conflict. I can think of no better reason or explanation of why this is so important. Many lower income countries experience high levels of debt distress. Some have defaulted. More than 70 countries are eligible for a temporary suspension of debt service payments owed to bilateral creditors. The G20 has also called on private creditors to participate in this effort. Discussions about expanding special drawing rights are also ongoing. The current debt relief may not be enough. It's very likely that the management of public debt will play a very important role over the coming years. And as speakers this morning will emphasize, it is important that we in the international development community strengthen participation of southern actors in these debates. The big question that we're putting forward for this webinar and our participants and the next one in our series that will occur on April 1 is how can we ensure that commitments for SDGs and climate do not suffer in the wake of what's currently going on. As countries are dealing with the pandemic and economic challenges, they're also addressing the reversals of progress against the SDGs and the need to address the ongoing climate crisis. We're presenting this webinar ahead of the spring meetings of the World Bank and IMF starting next week to contribute knowledge evidence and lessons on how economic, social and environmental considerations can be brought together. Today we'll be hearing about how the current global debt crisis is evolving. We'll hear about lessons from previous debt crises. And specifically, we'll hear about how the pressure of growing debt has severely impacted efforts to tackle the climate crisis and biodiversity loss. And then how to sustainably and innovative, how sustainable and innovative debt management can help enhance outcomes for nature and climate. So without further ado, let me turn to our first speaker. And it's wonderful to have with us this morning, Professor Stephanie Griffith Jones, an old friend of IDRC and known to many of you. She is Emeritus Fellow at the Institute of Development Studies in the UK, currently director of financial markets program, the Initiative for Policy Dialogue in New York, and has written widely on global finance. She will first set out for us the background of the current context of debt. Stephanie, I pass over to you. Thank you very much, Julie, for your kind introduction. And I would like to thank also IDRC and Arjan Dehan and IID for organizing this very important and timely event. In fact, the timing couldn't be better. Yesterday at the UN Head of State met to discuss precisely debt relief, and as Julie said, next week we have the spring meetings. So the situation for both African and low income countries debt is very serious. And in a paper we've just finished with Marco Carreras, we looked at first at the debt of Africa, its level and structure. If you can show the slide please. And you can see that the IMF projected public debt to GDP in general in emerging markets and developing economies has increased by 10% due to the impact of the COVID crisis to approximately 65% of GDP by end of this year, which is the highest level it's ever been. And I also quote you to quote UN Secretary General, who said that the response to COVID and the financial aspects of the crisis has been far too limited in scope and too late. And I think this is perhaps the main lesson from the history of that crisis which unfortunately have been many, which is that the response of the international community in terms of granting debt relief has tended to be always too little too late. And therefore has harmed development prospects of the debtor countries in a very serious way. So it becomes very desirable for low income countries and vulnerable middle income ones, which have unsustainable debt burdens should be given sufficient debt relief. And that at least part of that relief should be channeled to low carbon and inclusive recovery. The next piece. So what is interesting to try and think about how this debt relief should be granted. It's important to look at the structure, both of African debt in this case and then of low income countries debt. The share of African bilateral debt which is mainly owed to the traditional so called Paris Club members, because they meet in Paris. There are typically the Europeans, the Americans, North Americans I should say Japanese has fallen dramatically in Africa it fell from 52% 2000 to. Sorry, it went up from 27% in late. In 2000. I'm sorry. In 2000, 52% was held by these traditional Paris Club creditors, and now it's fallen to almost half to 27%. So there's been a major decline of these traditional bilateral creditors, and this has been accompanied by major rise of China as a big credit. And secondly, by a very important increase of debt owed to commercial creditors, particularly bond holders, which now accounts for about 40% of Africa's total external public debt, compared to 17% in the year 2000. So just to summarize the three top creditors to Africa since 2015 are bond holders private bond holders, China, and the World Bank. If I can have the next slide please. Now I want to focus on on the poorest countries, which of course have the highest levels of poverty and where, if you don't give sufficient debt relief in a timely way, the levels of poverty and deprivation, and the ability to meet the SDGs will decrease dramatically. So the share of total debt is a proportion of GDP has grown for both low income and low middle income countries. The debt owed to private creditors which I showed for the rest for all of Africa as being increasingly important is less important and I think that's interesting is one of the findings of our research. Only just above 10%, whereas it's much more for the more high income countries. And again, like for the case of Africa, China more than doubled its exposure to low income countries between the first and the second half of the decade by more than 130%, becoming the second largest credit. If I can have the next slide please. What are the policy conclusions and I will stop drowning in numbers. So again, I want to repeat because I've studied so many debt crisis too many. The key lesson from the history of debt relief is that it has to be sufficiently large and sufficiently timely to avoid what we call in Latin America in the 80s, a lost decade to development. And this story was also repeated in Africa and in some of the crisis countries in Europe, because this would also undermine these lost decades of development, lead to a decline in output and investment increases in poverty and more generally undermine SDGs. So that we have this new element because we have this global emergency of climate and also high inequality in most countries. So there seems to be a very clear need to link debt relief with sustainable and inclusive development. Before we think that part of the debt relief an important part should be linked specifically to projects and programs oriented to transform debtor economies into greener and fairer ones. If I can have the next slide please. We need sufficient debt reduction for those countries needing debt relief in lower middle income countries and middle income countries in Africa, as well as the small island states. In these countries in general we need equal treatment of public and private creditors to avoid that part of the debt relief which is given by public creditors is used to service private debt creditors so that the transfer would be from one set of creditors to the others rather than to the countries. Securing debt relief from private creditors may require both carrots and sticks. The former carrots may include for example credit enhancements or guarantees, which could be for example from the World Bank or IDA or the African Development Bank in the case of African economies. And in that sense it could build on the experience of the so called Brady bonds, which emerge as a solution to the Latin American debt crisis, where there were credit enhancements given and that helped significantly encourage private creditors to give sufficient debt relief, to take a haircut as private creditors like to call it. For the most low income countries, especially those that have not raised bonds, debt relief from private creditors seems actually relatively marginal. And this is one of the findings of research. And so it may be more desirable initially especially to focus efforts of debt relief on public creditors. And it is absolutely essential that any debt relief includes Chinese creditors in equivalent ways to other public creditors. And the Chinese creditors are included in the joint discussions of debt, as they increasingly are, but not completely formally yet. And finally, if I can have my last slide please. The G20 late last year designed a common framework, which is a positive step. It needs to be transformed to allow comprehensive debt relief for green and inclusive recovery to help low income countries and vulnerable middle income countries respond to COVID recover and invest in increased resilience and development. And therefore, all leaks and mix whose debts are considered unsustainable, not all of them are, should be supported by the international community to participate in debt restructuring. On the other hand, as a sort of quid pro quo governments receiving such debt relief would need to commit to reforms and investments that align their policies and their budgets with the 2030 agenda for sustainable development and the Paris agreement. So I think the time to act is now, because every, every month we leave. There are people, additional people going into poverty and additional missed opportunities for investment in climate resilience and climate mitigation. I, I finished with an urge and a request for rate debt relief now. Thank you very much for the opportunity. Thank you so much Stephanie. That was a wonderful way to start off and and I think a good place in terms of both context setting but also reflecting on where we need to go from here. So let me turn to Debbie Suri. Deb is director and technical expert at debt markets and public financial management consulting limited. He will summarize for us key lessons from earlier debt crises and successes and challenges in integrating development objectives into debt relief. I'll pass it over to you, Deb. Thank you. First, let me first say good morning. Good afternoon. Good evening. Everybody. I'm also to the month. I would like also to thank ID and IDLC for inviting me to participate in this very topical event. And I've heard a little bit about the, the, the, the issues that we need to be looking at. So I'm not going to context, etc. So I'm not going to be talking too much about it. So if we can move to the next slide. Yeah, thank you. So I will just make a couple of very quick footnotes on the context. Certainly the pandemic has been creating a lot of different sort of havoc in different countries in our different countries where we're working where we are, we are seeing all sorts of issues there. Now, myself personally when working with those governments, I found, for example, how their budget was actually getting getting crazy in terms of the fiscal, the squeeze in the budget, the having to invest into health and social sectors. And all in all, when we see all that, there is something that gets squeezed out. And obviously what we see is that the investment that usually we would expect to see in adaptation climate change adaptation, mitigation programs, etc. And that squeeze out. And one would wonder whether in some countries whether they are actually part of their going forward program. So that's a challenge. If you add to that the debt burden now, so many countries getting to that distress, then suddenly there's a big, big, big trouble. Obviously we welcome what the G20 has come up with the suspension, the new framework, etc, etc. But clearly like you heard, Stephanie mentioned, there's probably there's a lot more that need to be done. And obviously, and we hope that we believe that something's going to happen sooner than later, but at least the climate angle is going to be taken into account. We are currently working, for example, as part of a small consortium, we are doing some debt climate nature work in West Africa. But today, what we're talking about here is about this global initiative about the so called international multilateral scale of initiative that we hope the international community is going to come forward with and and something will be done about it, whereby the debt, the climate nature is going to take place. So I'll be sort of stepping back a little bit and talk, well, something that started 25 years ago, and I'm talking about here, the HIPAA initiative that was established that was that started in 1996, updated in 1999, and obviously try to find out are there some lessons that can be learned there. My topic today is clearly about the framework itself. If we want to talk about the lesson from HIPAA probably we need two hours and obviously we don't have two hours. I have about eight minutes now, I think. And so we are going just to pick on a few things. I'll put a small footnote on the slide there. It's a small reminder just in case, you know, like my daughter like to like that she's a full climate, full on climate. But when I talk about debt, she doesn't understand anything. So I'll put it there. Just to mention that the HIPAA initiative was, if I can use an expression, it was in hibernation for some time, but certainly we have Somalia is within the process. And about four days ago, there was a some good announcement for Sudan, at least about them also being sort of being considered for getting some debt relief under the enhanced HIPAA. So it's not really talking about history here. There's something that we can learn as we continue to see some something happening on the ground there. Somalia, Sudan, et cetera, et cetera. Okay, next slide please. So like I said, so is there anything we can learn? Can you press enter again please? Yeah, thank you. Like I said, we can talk a lot, but I'm going to pick on a few things that are relevant to the framework that we're talking about, the scaled up approach. The first one that comes to mind, obviously, the comprehensive framework. And that was pretty good. People can say that the HIPAA had a lot of issues about it. But one thing which, and I remember somebody was mentioning at that time when we were working on the ground, that was a landmark initiative in the sense that it actually brought, it was comprehensive, it brought everything together. So everybody together, but also all the issues together. That was number one. Number two, it was this macro framework. This linkages bringing in the reform and bringing in all those different issues that needed to be done. In fact, more, more, more issues have been put there. I was looking at the Somalia one and it reminded me of how many things that needed to be done here. So there are lessons to be learned there in terms of the comprehensive framework, especially when we want something which is big, which is going to have a big impact in terms of what we want to do. So that is one thing that we'll come back to that later when we try to see what can we do with that comprehensive framework. And the link to that is the second one, obviously, is you've heard already, we don't want this piecemeal approach. And there, HIPAA also taught us about this coordinated effort to bring in the multilateral, the bilateral, the Paris Club, the non-Paris Club as well, and the commercial creditors. There were issues there. Not everything was successful. I still remember, for example, the statistics in terms of the non-Paris Club, but certainly the idea was trying to get this so-called comparability of treatment, try to bring everybody on board to provide those dead reliefs is something, this coordinated effort is something that we can learn from there. The third one, which for me is a favorite one, is about this link to poverty reduction. And that's pretty useful and pretty relevant to what we are talking about today is about obviously climate, but there, the link to poverty reduction, the strength and link between debt relief, poverty reduction, et cetera. And there again, one could argue that more could be done, but certainly there was something there to work up an increase in social spending was found from savings that actually, from non-payment for writing off certain debt, et cetera, et cetera. And there are some statistics there. As I said, more could be done, but there was something there. The other point is a promoting local ownership. Obviously, maybe some of who are listening here will say, oh, local ownership. I mean, it was all driven by the international community. It was driven from external, but the reality is that there was countries developing their own poverty reduction strategy. They had participation, bottom-up approach, civil society participation was there. So I'm picking the ones that are positive. I mean, we could talk a lot about the negative elements, but that was something which I think we can work upon when we're talking about this global initiative. And obviously, link to that is a criteria. We want to see, for example, whether the money is being spent, the money that is being released is actually spent. And again, we can see there were a few, there were indicators there. Like examples that are provided in terms of increased expenditure and social services, et cetera, which we can work on. The final point here on this one is about not talking about the debt relief or debt reduction. We want this new initiative to talk about debt management as well. So to give a chance in many options. So here also, there was a lot though, like I said, the focus was on debt relief, but there was something on debt management as well. I saw, for example, the one in Somalia, now they're talking about the flavor of the month nowadays is public debt transparency. So it's a lot about reporting. But in the old days, what we were doing, we were going to countries. And I remember in one country, completion point trigger was about building a database in a matter of a month. How can you do that? But that was something that needed to be done. So there was something about debt management, et cetera. So next slide. Yeah, I'm going to have to give you the one minute warning. Yeah, yeah. Thanks. Yeah, I'm there. So here it's, it's all about just taking everything that I've spoken now in one my one minute and converting it. So what do we do about all that. So obviously, we need that big framework agreement. And here to get everybody on board to get the G20 to get hopefully there's going to be something at the spring meeting hope on the side of the climate also so whatever we're going to have in the cop, the US on meeting on climate change. So put a big push there, obviously get all the creditors together that's very important and learning from the HIPP process. The second one obviously I won't say anything. I've already said we need, we've looked at the current currency, the current structure of the countries debt portfolio and we need to do something about it. We can start with a small pilot and we can move on. The last three elements that come, these are the ones where we're going to do a lot more in terms of the scaling up and you're going to hear a little bit more about it. And we're going to say much this big thing we don't want to do the debt swap that was small, smallish debt swap that we were doing in the past in the 80s, etc. Or even in the HIPP initiative, we want something which is big, which is well scaled up and we are going to hear about it. The link to that obviously the local ownership, it has to happen. And in those countries, it is very important that it happens because for climate, it's not about the central level, it's also about the beneficiaries at the bottom there to get engaged to actually do the work. So hopefully, we're going to see that local ownership by using the local climate strategy on the own of the countries. We'll hear a little bit about the KPIs. We have worked on that we have done and these could be used also to work. And obviously the debt relief and the debt management, this is something like I said we'll be there. So a menu of products, debt for nature, debt for climate, but something like we could have a bit more in terms of products relating bonds and climate change, etc. And finally, just I know I'm thinking for some a bit more time, but the final point I would like to say is concluded by this to say yes, we've been talking a lot recently about those initiatives. We are all sort of passionate about it, but it's not about us. I think the most important point is about the decision makers. So we do hope that those who actually matter will take the decision in to crystallizing the global initiative linking up debt, climate and nature, not in five years time, but pretty soon now. Thank you very much. Thanks so much, Deb. And I hope there's a number of these things we can pick up in the Q&A section. But I think that was really great to get that that perspective that you bring over time. So now we're going to turn to Sejal Patel. She's a researcher in IED's Shaping Sustainable Markets and Climate Change Research Groups. She will discuss how to link debt sustainability to climate and nature. What does the approach look like? What are the considerations and what role could various actors at the international national and local level play? Over to you. Hi, and hi everyone. Really great to be here. Yeah, exactly. So following from Stephanie and Deb, I'll be talking about the urgency to link nature and climate and what that could look like to the debt management. And this is some work that we've been doing with UNECA and we have Jean-Paul Adam on this call who will also be able to give some remarks. So just going on to the next slide. The first map on the left shows external debt stocks as a percentage of GNI in 2018. And as Stephanie and Deb have already discussed, the updated figures that has been increasing since 2008 and half the low income countries are already in high levels of debt distress and that urgency is rising. The second map shows ability across Africa. And that's measured by the World Risk Index. And the World Risk Index calculates climate and nature disaster risks. And it's based on the calculation of exposure and vulnerability, where vulnerability is defined as susceptibility, coping capacity and adaptive capacity. So the darker peak on the map shows highly climate-wonderable countries. The western and central areas of Africa are the most climate-wonderable. So countries coming up high on the index include Cape Verde, Ibarati, Comoros, Niger, Guinea-Bissau and many others. The third map that we see here, it's the Jeff Benefits Index for Biodiversity. It shows the relative potential of each country to generate global environmental benefits in relation to biodiversity based on the species represented in the country, their threat status and the diversity of the habitat types in the country. The darker green shows countries that require the greatest allocation to support their biodiversity based on the represented and threatened species and habitats. Some of the highest countries coming up here are Madagascar, South Africa, the Democratic Republic of Congo, Cameroon, Kenya and many others. And then to go on to the fourth map, that shows the IDA Resource Allocation Index. The IDA is a part of the World Bank that supports the world's poorest countries with additional financing and typically more concessional financing. The index is used as a proxy, we're using it here as a proxy for credit worthiness, so which impacts the credit worthiness which impacts the availability and cost of credit for countries. The allocation index maps out country performance based on four criteria. Economic management, which includes fiscal policy and debt policy, structural policies, including trade and business regulations, policies for social inclusion and equity, including gender, public resource use and social protection, and public sector management institutions, including property rights and transparency, accountability, corruption, those kind of issues. And what we can see on this map is some of the countries with the highest scores include Rwanda, Cape Verde, Senegal, Kenya, Uganda, and as many others. And then the final map shows all of these overlaid. So we can see where the rising debt burdens are compounding with high climate and biodiversity vulnerability, and where access to credit is limited. And then you can start building this picture of where this kind of coherent and integrated support is increasingly critical. So we already have very high urgency in countries like Cape Verde, Kenya, Senegal, Uganda, Madagascar, and many others and with the pandemic, the need is rising across all of the countries. So, so one of the key points that Dev and Stephanie were raising as well is that the pandemic is exacerbating the debt situation mounting fiscal pressures, and that's taking spending away from development, climate and biodiversity needs. The economic impact also affects progress on SDGs. And the World Bank last year found that global extreme poverty was expected to rise for the first time in 20 years. And as many as 150 million people could be pushed into extreme poverty by this year, depending on the severity of the economic contraction. And so that's why acting now becomes critical and why linking all of these together becomes critical, because if you focus just on the debt burdens, the nature, the climate crisis could then undermine the economic recovery and the resilience of the economies. Just going on to the next slide. So this is, this is a map from UNESCO's research that shows that many African countries are projected to lose 2 to 5% of their GDP to climate change by 2050. And that's my conservative estimates. So the impacts of climate change are as pronounced as COVID-19 and will only person. We, we lay out this kind of need for debt management for climate and nature as an approach to coherently tackle these three crises. So what that looks like is the creditor and the debtor agreeing to restructure the debt in some way, whether that's a change in the terms buying the debtor cheaper rate on the secondary market or supporting conversion to a different type of financial vehicle. The transaction then leads to an amount saved on what the debtor would have had to pay back. And then the saved amount is then invested in climate adaptation, mitigation, or nature and biodiversity activities. So in effect what we have is the money that was going from the government budget to service the loan. It's now going from the government budget to pay for climate and nature activities in country. And then also adding that that transaction should also involve some proportion of debt right off because these countries are having fiscal space issues, they're needing that fiscal space freedom to support other key spending kind of priorities in health, education and other areas. So, on the next slide, we, we lay out some of the key lessons that deaf has, deaf has explained. So, building into the into international architecture, shifting to system, systemic programs, and shifting to using budget support where funds are paid into a data country's own budget. And the advantage of that is that it allows for a larger amount of funds to be mobilized increases data government ownership and shifts accountability to national citizens. So the funds can then be managed as before it's based payments on agreed policy commitments like NBC's and biodiversity strategies. So, so what that means is that for the creditor there's transparency and where that financing is going to redirected the debt services payments and for the data countries. It means that there's greater ownership for that country to support a nationally defined activities and then be held accountable by their own citizens. So, for example, this could be what the Gambia have been doing in the process of developing the LTS the long term, low emission development strategy, which is presenting their national priorities across the board and what they could do is link instruments like this to those kinds of plans and policies to use for the support operation operationalizing those kind of policies. On the last side, I'll very quickly look at incentives for different actors. So we have the ministries of finance and central banks and that are countries. And these, these actors are holding the incentive to undertake that management link to climate and nature to support economic growth sustainability and ownership. So data countries that also are approaching creditors for debt management in this way, and we're likely to get a sympathetic hearing, because those creditors are also wanting to contribute to international climate and nature commitments. And it's it's showing evidence of funding activities that are already in place in those countries. And there have been a number of data country leaders that have been expressing interest in high level forums, for example, representatives of Cape Verde, Uganda and NABIA and other countries. Under the UN process, this represents new climate finance at a significant volume. The other key actors here to mention are UK and China, who play will play a role as hosts of the climate and biodiversity conventions this year. Which on the private creditors which Stephanie has talked about. And here for private creditors restructuring can be better than defaulting on loans. So they'll still get a return if they support this kind of sustainability. Then in the US Biden's climate plan supports green debt relief for developing countries that make climate commitments. So finally, something also that's in development at the moment is an IMF World Bank OECD and UN platform that's that's being explored. And that would form a kind of international architecture that's needed for this kind of new hippie type of initiative that can help bring together these debt nature and climate into intersecting areas. And I'll leave it there. Thank you. And Sejal, you've given us a lot to think about and reflect on and I'm sure that will come up in the Q&A period as well. I now have the pleasure of turning towards two practitioners. And I'd like to thank them both so much for joining us today because I know how packed both of your schedules are and how much we look forward to hearing from your perspectives on the priorities highlighted here and how they relate to the work that you're doing. So first I'm going to turn to the Honorable Bob Ray, who is currently Ambassador and Permanent Representative of Canada to the United Nations. He's led a very distinguished career as a Canadian politician as a Canadian diplomat including many humanitarian emergencies. I won't provide a full outline of the ambassador's biography but suffice it to say we're very honored to have you with us this morning. Ambassador Ray, I turn the floor to you to kindly tell us about your and Canada's priorities to support responses to global debt and financing for development and how the research that we're doing can support these efforts. Ambassador Ray. Thank you very much. It's good to be with people who know what they're talking about. I appreciate it very much. Yesterday, the co chairing with the secretary, the secretariat and with Jamaica of the of the meeting on on debt that we sponsored be Canada's co chair the financing for development initiative at the UN with Jamaica, and the secretariat for the last couple of years, and obviously COVID put us into high action, producing a number of initiatives and the round tables that I know many of you participated in over the summer. I want to just to summarize to say I think everybody, I mean, I think the, the directions that are being set out are entirely right. I want to just try to point out some of the practical challenges that we face in in implementing what's being proposed. Listening to the speeches yesterday, there was quite a substantial consensus on a couple of fronts one is that there has to be a much greater commitment from the wealthy countries to embracing and understanding the extent and nature of the challenges facing the developing world as a result of COVID. Secondly, that this is an opportunity in fact for us to link the the rebuilding process to the climate change agenda. And we need to, we need to figure out how to do that and we need to figure out how to do that quickly. And having said that there are there are a number I think of challenges that we have to face up to that that need to be discussed much more frankly. The first is to understand better. The on the chronic debt issue. It erupts it has erupted as a result of of COVID-19. I mean, any, any seizing up of the economy like as we have seen is going to is going to on its own create substantial issues around debt and debt management and debt financing liquidity and and you know, defaults and everything else. But I think the thing that needs to understand and if I was to suggest the next next time there's a chart. Let's have a chart that shows what the overall debt situation has been since the 1960s, and to really try to understand how this these chronic problems are seriously aggravated by additional factors in the world economy. And how they how they then become something that the developed countries feel they have to deal with, which leads me to my second point, which is, there is such a huge gap between what the developed world is prepared to do for itself. In other words, what nations are prepared to do for themselves wealthy nations in the face of a crisis like this, as they did in 2008 2009. That's the fact they're prepared to do for everybody else. And this is this is a really serious political problem. Watching the news is, and I don't if you saw the, any of the of the talks yesterday but Jillian Tep from the Financial Times, gave a very, very good analysis at the end where she said, the problem I see it as an as a journalist, and she was saying, the news in each country is all about each The news is not about what's happening in the world. If you're living in the United States the news is about the United States. If you're living in Canada the news is about Canada. It's not we don't have enough shared consciousness of the problem. And this is a really serious political issue, if I may, because it creates this this enormous challenge that we constantly face to bring people in. The third is to understand what Stephanie pointed out I think it was extremely helpful. If I may call you by your first name Stephanie I'm just feeling informal today, and to say look we need to figure out why and how commercial and Chinese debt became such a large part of the story, because that tells us something about the channel the political challenge that we face. And by the way, if you think that it's easy, you're wrong because in their in their public narrative, the Chinese government says, Oh, we don't we're not a big sovereign creditor. It's all done by the private sector this is commercial debt. We don't have anything to do with that. And that is really not a helpful narrative because it's not actually true. But it also signals that the challenge that we're going to have and and integrating China into this process is going to be extremely important, but also challenging politically. And because it demands, it requires an extension of transparency and a willingness to accept responsibility, which is politically not as easy as it sounds. And the next thing is of course is private commercial creditors who generally speaking are not acting out of a sense of charity, or public policy duty. And we have decided to move in because countries want them and why do countries want them countries want them because although their money is more expensive, it comes with fewer conditions and requirements. And so that's why countries say, Hey, it's flexible. It's 6% money. It's 9% money, but we'll take it because it's more flexible. This has been the pattern the last 15 years and it's very risky. It creates huge problems. When we get into a situation like this, where everybody says there's a public policy issue of debt, how do we solve it. And the answer is we don't really have the architecture we're kind of making up the architecture as we go along, which is what we're seeing in terms of the improvisation that's come from the G 20 from the IMF from the World Bank and saying this is how we have to try to do it. And my final point is that we need to be very careful with respect to coming up with global solutions to problems which will have a very differential impact on different on different countries and different kinds of situations. We all accept the need for climate change initiatives, we all accept the need for initiatives that are based on restoring biodiversity and addressing the ecological and environmental challenges that we face. But even in the eight months that I've been at the General Assembly, I've learned something and that is, every country sees it a little bit differently. We have to be very careful of imposing a kind of global cookie cutter approach on everybody. First of all, adaptation money for most developing countries is way more important than mitigation money. Way more important because of the nature of the impact to climate change is having now it's not a future problem it's a today problem. And the those infrastructure dollars just aren't there they need to be there. They need to be there on concessional terms. And, and related to that is the fact that in as I've understood development theory as it's evolved many different dimensions over many years ownership is a very important thing. It's very difficult to have national ownership. If you're imposing one international global approach. And that I think is something we have to, we have to come to grips with in an appreciating the sensitivities that are going to be coming from the developing world as it as it responds to whatever initiatives are are brought forward. Canada's purpose in all of this has been to create a space where there can be a real conversation between the advanced economies and developing economies. There are, there are other spaces at the UN to do this like Echo Sock, for example, on 10 and all of the agencies, but a lot of what happens there is really just people talking past each other. One of our objectives, which we've only partially achieved, I have to say, is to try to avoid, you know, the prepared texts and the prepared positioning, and to try to get to a better and broader understanding of why, why this is as challenging as it is, and how do you get from the very clear ideas and direction that we're receiving from the academic community, and how do we actually get get that to happen and make it happen. Yes, I suppose part of my job, but it's, it's, it's challenging. It's fun, but it's challenging, because it requires a real ability to listen to why some things are happening and other things are not. So to put it, put it in simplest terms. The first problem is a lack of attention focus, frankly, an empathy on the part of the developed world. And secondly, a challenging political climate for many, many of the countries in the developing world, where it's not simply an easy thing to say okay let's sign up for this, this is how it's going to get done. We've got to make sure that the pattern to get there, the road to get there is is clearer than it currently is, although I think the target we can all see in terms of what would be the sensible public policies I think many of them have been in line, but we have to figure out why has that been so difficult, and why is it so difficult now to actually move from aspiration to action, which is the name of the game. That's it. No slides. That's it. Thank you so much Ambassador Ray, it's really great to hear your perspective from from the place that you're coming at this from, and we really appreciate the time you're taking with us this morning to share it. I'm going to have to, I'm going to have to leave a little early because I've got something at the General Assembly at 10 on Syria, but I'll stay as long as I can. Thank you so much ambassador we really appreciate it. I'm now going to turn over to Jean Paul Adam, who's director for technology climate change and natural resource management at the United Nations Economic Commission for Africa. Mr Adam from the vantage point of UNECA. What are some of the priorities that you see in the growing debt crisis. Thank you so much, Julie and good afternoon from Addis Ababa to everyone. And let me just say how much we appreciate the opportunity to engage in this discussion with the help of IED and IDRC, but also all the different perspectives that we've heard. From the perspective of the United Nations Economic Commission of Africa. We want to try and position debt swaps away from simply an opportunistic means of addressing certain debt situations and certain development situations to make it mainstream development option. That means looking at the issue of debt at looking at the response to climate change, primarily as a development issue. And particularly in the context of Africa climate change is a development issue because it is arguably putting a bigger burden on African countries, even then covert 19. I will show that in some of the sites that have been worked on jointly with the DCA. The modeling that we've done within the African Climate Policy Center which is in within the Economic Commission of Africa has shown that on average we expect two to 5% of GDP to be lost in African countries by 2030. And that's based on conservative warming estimates. In some more extreme warming estimates of above three degrees in the Sahel this could lead up to 15% of GDP being lost to climate change. And it also notes that African countries also have less resilience in dealing with the shocks linked to natural disasters associated with associated with climate change. So for example cyclones Idai and Kenneth in 2019 led to some countries spending up to 9% of their GDP and responding to these kinds of disasters. Climate change is something which has been a burden for a long time and has been cumulative over a period of time covert 19 is recent and the combined impact of the two is very dramatic. And the particular difference for African countries is their ability to respond. African countries had a high fiscal deficit deficit at the middle of 2020 of minus 8.13% of GDP. In 2021 while it's expected to improve that estimate from the ECA is that it should not probably go higher than minus 5.44% of GDP on average. Now, this is situated in among countries that already have very taxed to GDP, very low tax to GDP ratios, and which have been falling since 2015. And this is often asked why these tax to GDP ratios falling, mainly because of the economic model which is mostly based on the exports of extractive industries with limited value addition, and therefore the opportunity for additional tax basis is limited. And this is shown by the fact that 11% of Africa's exports are from the extractives natural resources sector, but they only account for less than 1% of employment. Now this contrast with the approach that OECD countries have taken, which have essentially finance their response to covert 19 through access to cheap and affordable resources which African countries don't have, whether they're least developed countries middle income countries, or upper middle income countries. So unless we unlock the situation of debt, which allows African countries, particularly those that are middle income to borrow affordably, we risk the lost decade that Stephanie as mentioned. So the opportunity of course is that it's the year of the Glasgow cop where we have a number of commitments that have already made for example of committing to net zero by 2050 by a number of countries. This means that to reach those those targets that to be meaningful resources deployed. First and foremost African countries will ask for the $100 billion per year commitment to be honored. And secondly, there's opportunity for additional finance and this is where debt swaps in particular can come in the debt swaps opportunity, particularly useful for countries that maybe our middle and upper middle income are not able to access easily from commercial markets, but can identify strategic opportunities to invest in areas that will also generate additional multiplier effects. One of the questions that emerged in the chat was, how do you decide where to put this money without having the dreaded word of conditionality. And I think one of the key things to keep in mind in the context of Africa is that for Africa investment in climate resilience is not about meeting targets linked to the Paris Agreement or to Glasgow. It's about development. It's about building resilience to the shocks that that we know are coming. And recent studies that we've done in ECA on the green recovery have actually shown that you get a better return on your investment in green sectors than you would through fossil fuel based sectors. And an example would be in South Africa where it was shown that investments in renewable energy, sustainable electrified transport solutions and nature based rehabilitation would deliver 250% more and 420% more value addition throughout the economy compared to similar investments that would have been done in fossil fuel based investments. So if we can look at strategic opportunities that countries have already identified themselves based on their economic priorities. These are the key areas where we can channel the proceeds of debt swaps. The key that's emerging as well ahead of the spring meetings is that with the increased issuance of of SDRs, the opportunities as well to use the World Bank's policy guarantee mechanism to reduce the cost of private sector financing through bonds for example, means that you could refinance debt in some cases by issuance of new bonds on more affordable terms and supported by credit enhancements from DFIs. So back to the point of how do we support countries themselves in the priorities that they have, whether it's to provide energy through new bills, or whether it's to unlock the job opportunities that are linked to nature based solutions. And I'll conclude my remarks by going to my own experience and I previously worked in the Seychelles government and we did do a debt swap in 2015. We had a low amount and I think that's one of the challenges, how do we upscale, but we started with the principle that we wanted to protect 30% of our exclusive economic zone. And we had that principle for different reasons, firstly, because it's a destination that was marketing itself around the pristine nature of its ocean. Fisheries are very important and studies have shown there's a recent study that has just come out that has shown that for every 5% increase in marine protected areas assuming that they are properly targeted. You get a 20% catch increase over over time starting from five years after the designation. So there were real reasons as to why we wanted to designate that. And we mobilized resources on the basis of that so we start with what the countries want to do and link that with building climate resilience and responding to covert 19 by creating jobs and multiplier effects in the economy. Thanks so much it's really been a pleasure to have this discussion. Thank you so much for that contribution it's really appreciated and it's great to hear some of those very concrete examples that you're able to bring forward. So this sort of concludes the portion where we have the panelists and our practitioners speaking and we're going to move into the Q&A section. There's a few questions that have already been posed in the chat now there's about 15 minutes for this portion so I would just ask if panelists could keep their comments fairly short to allow us to get through a number of different questions. Perhaps where I'll start is the first question which is here which came in and some comments touch on the point of conditionality which I believe Jean Paul just spoke about a minute ago. But good and bad and that this is important for our objective to broaden the debate and ensure local actors are empowered to address these challenges. The question that Hannah Ryder put forward and maybe a particular interest to some of you and Jean Paul you may want to contribute some more on this Sejal and others. There are some who are skeptical that linking debt relief with green and fair programs is just another way to create conditions for poor countries just like structural adjustment programs in the 1990s. Post a debt crisis that poor countries did not create themselves. How would the panel members address this concern? What kind of conditionalities would be good? Would NDCs be a good instrument? And then for Dev, there's a specific question on how you reconcile the use of KPIs with participatory ownership principles. We know that meta frameworks do not work if imposed and the use of KPIs and targets must be done very carefully lest they become a tool for imposition. The history of centralized management has unfortunately done the opposite of improving ownership in certain situations. So I'm going to open the floor to the panelists but perhaps I'll ask Ambassador Ray. I know you need to leave shortly if there's any comments that she wanted to add to any of the questions that have come forward first and then I'll go to the other panelists. I don't think so. I mean I'm in the interest of time and giving others an opportunity. I just want to be clear that I'm not at all arguing against the need for major climate change investments. Quite the contrary. I'm just suggesting that in order for us to be effective, we really have to fully understand the nature of the overall financial and debt situation in developing countries. And I think that we there's often two worlds right you've got the climate change folks who are coming up with all sorts of creative ideas and various various ways in which these issues can be addressed. And one of one of Canada's arguments has been here at the UN is to say, yes indeed. But or and we need to understand why it's proving so difficult. And we need to understand why there's such a gap between between what I call aspiration and reality. And I think a lot of it has to do with understanding better the nature of the real financial and economic challenges facing the developed world and how often governments in advanced economies come up with approaches either through their departments of development or departments of the environment or that really have nothing to do with the extent of the problem just to give you a simple, a simple example in the in the hundred billion dollar target for climate change financing which is, you know, we haven't reached yet but we put it will be this year, and we'll get will, there'll be additional funds put forward. It's really important that we understand that most of this financing isn't going to work unless it's really concessional. And, and traditionally departments of the finance are keen on that they say well no no we got it's got to be based on some interest return etc. But if you do that you're, it's simply not going to happen. They're not going to take it up because they're so severely indebted that there's no way they're going to do it. If your department of finance you say well too bad that that's okay they don't take it up. It's not in our lives not in our not in our balance sheet. They don't know problem. But if you're actually looking at the real development need, you need to understand the particular situation that gives rise to the demand for for concessional finance and underneath that you you've got to deal with the issue of of the debt overhang which is there from, you know, all of what is all is what has passed and has been accumulated. And that's why there's going to have to be debt cancellation there's going to have to be a debt reduction. There's going to have to be a different approach to that than frankly most countries are embracing at the moment we're still not there yet. Thank you so much Ambassador Ray, I'm really appreciate it. I have to run but thank you so much. Thank you. So I'm going to pass over to the other panelists but I'm actually going to add one additional question as I send it back to you just following from that, which is a question from Roy Culpepper. Ambassador Ray's welcome assertion that for developing countries adaptation is way more important than mitigation. And why is this view not universally shared and expressed and resources allocated accordingly because I suspect many of you may have views on that as well. I realize that's a little bit of a collection of questions but I think that may be a good way to try and answer a number of them in the short time that we have. Can I turn to you next between the three or four different questions I've now posed, and then feel free to pick up on the ones that seem most relevant. So, um, so maybe if I start with the question about adaptation being more important than mitigation and in many of these countries that we're talking about. So look at the collective emission emissions of the 47 LDC countries that amounts to less than 1% of annual greenhouse emissions globally so we're talking about very little emissions that these countries are already emitting. So it is about reducing the amount of emissions for those countries. It's more about supporting them to to go to build climate resilient development pathways. So the impacts are already facing. So the mitigation side of it's a little bit more nuanced for those countries. And, and what it does come down to is this kind of supporting broader economic development objectives, but in a way that is taking into account climate and nature. So I think that also touches on the question about conditionality. It's not something that is imposed on those countries but as I was saying representation it should be something that's linked to national strategies national visions, and really working with the country and at the national and consulted with the subnational actors in that country are seeing as the needs for for what activities need to take place to go on to those pathways. And I'll leave it there. Thanks so much Sejal. Um, so I'll just, I'll take different people insurance Stephanie is there anything that you'd like to add to the questions that have come forward. Oh, thank you. Um, yeah, just compliment what Sejal said very clearly. I think that it is important for, especially small row income countries to focus on adaptation and increasing their resilience. But in some cases, actually doing things that are mitigation, like having renewable energy which may be actually cheaper as well making making energy then more affordable for example for people for economic activity in general. Maybe better for their development. So I think that parts of mitigation that are also good for the countries themselves and not just with globally, but I totally agree and endorse what Francis Stuart said in the chat box, which the idea is to start from a conditionality for a country to design its own program consistent with SDGs and their own and DC, and then have some kind of monitoring. I think that will be the best. My other point, I wanted to briefly say that we're talking here about that relief. But this is only part of the international financial development finance architecture. As Francis was mentioned, we need more SDRs. And I think it would be good. There was a question about that, not only to have this first one but perhaps next year as as the United Nations Economic Commission for Africa suggested have a second SDR allocation. But also, and I think we have not mentioned this I think it's extremely important to increase the capital of multilateral development banks, including the regional development banks, so that they can lend more it's not just about debt relief it's also about new money. And ideally money which is either concessional as the ambassador said, or at fairly low interest rates and long maturity. And finally, I will finish with saying that I have some doubts about the suitability of private flows, particularly for very poor countries because these flows are very volatile having been a Christologist for a long time I've seen these flows come and go, damaging the development prospects of countries. And so they are quite costly, they're fairly short term, and they can create major development problems as well as that crisis so I think that giving so much importance to regain market access for particularly for very poor countries is maybe not the most important goal from a development perspective. Thank you very much. Thanks so much Stephanie. Can I pass over to Jean Paul for any reflections that he has on the questions. So the first thing on the adaptation and mitigation question. The, the priority has always been for African countries on adaptation because, and they've expressed that because of the lack of flow of funds that have been that have been going to adaptation to the GCF, for example. So that focus has really been trying to recalibrate the balance. But it would be, and to, to give another example of the statistic that Sejal mentioned in Africa the whole of Africa represents just 3.8% of global emissions, while being home to 17% of the global population. So you can see that per capita Africa is really a long way behind. That shows as well the need for investment, not in mitigation, but in energy. But if it's done around renewables. It actually contributes towards mitigation. And as Stephanie pointed out these are some of the, the easy investments that should be done as possible for different reasons. Firstly, if done right, they create more local jobs. And they, they also study done by arena actually showed that in terms of the gender balance as well in renewables 32% usually go to women, as opposed to fossil fuels where it's it's less than 22%. So there's a 10% differential in terms of for example the gender balance even though 32% still not good enough. The investment in renewables creates jobs quickly and and and higher value jobs, which then create further multiplier effects as well when you're connecting more people to the electricity grid. There are 590 million people in Africa still don't have access to electricity. So we need to mobilize finance for energy, not because of mitigation, because Africa is net positive we could even argue. But because we need to invest in energy and energies pops one of the main priorities. But around adaptation is that there's huge opportunities as well and the studies that we've done have shown that there is a huge job creation potential around adaptation based activities particularly around. And here you can have a linkage with food security on the African continent where developing climate smart agriculture is going to be a priority because that it's about efficient use of the space. Because even though Africa still has some of the highest rates highest levels of forest cover in the world, it also has the highest rate of deforestation. So the trend is is is negative. But countries themselves have already identified a number of these opportunities for investment. And I will point in particular to the African Union green stimulus program which was adopted in January, which has focused very much around nature based solutions around these investments in agroforestry climate smart agriculture for food production. And I think that we can really address the issue of conditionality by looking at priorities that African countries have already emphasized themselves and access to cheaper resources should be linked as well to the goals of of the Paris agreement and the SDGs and the work that we're doing an ECA also working with four countries in West Africa to support them in developing programs that would allow them to access for example, that swaps, but building on the basis of what they want to do what are the priorities that will create the most jobs for them and create economic opportunity. Thanks. Thank you so much. colleagues I recognize that we're at time for the webinar this today, but I would like to just ask your indulgence because I'd like to turn to dev and give him an opportunity for a couple of minutes just to reply to some of the questions and particularly the very specific one that was asked of him. So dev, I'll turn over to you. Let me try to address that specific issue which was done up by the others. This always about KPIs. The big, the big usual natural instinct is to think that this is where so called best practice is going to be imposed is going to be to be brought up from the top to bottom. And suddenly you get into trouble. So I would agree with a comment made in terms of trying to do something which actually the countries in question recognize so we've been talking about this national ownership, looking at what actually happened. So when we are talking about those programs. So we're looking at what is happening at the climate level, the nature level, the biodiversity level, look at the national adaptation plan and try to find out certain elements there that the countries recognize. So yes, you can come up with a list of KPIs, which is like going to be put across countries, but they need to be adapted to the local reality. Otherwise, then it's not going to be useful for tracking anything because KPIs is about putting something there to actually track progress. So this is the way I can see it happen. And we've tried it in some other cases, not on planet, but it does work. So that that would be my answer on that, rather than imposing it from the top. Okay, that's one. Secondly, is on this conditionality. Every time I put conditionality on my slide as well, reluctantly, because it's always having negative connotation. But again, what we need to look at here is using the SDGs, using something which is what somebody was mentioning the positive side, something that when we are talking about those countries, they say, okay, I can do that. And in climate, for instance, there are a number of things. And I think there was a comment made about the national determined contributions, etc. So we could bring in those particular elements where the ownership is there, the people who were talking, the stakeholders that matter, they actually can organize it rather than something coming up from far away and being imposed. And that's not going to work. So I think the whole approach of putting in certain conditions, and if somebody can come up with some words, conditionality, something else, that would be great because it has, from the beginning, it has had a negative connotation. And finally, on this adaptation, education, I think there is a way to a balance that needs to be done. My own work in some countries where I've seen it there, they need both but it's a question of where they are and how to actually make it work. So I think I respect this here. Thank you so much, Dev. And I'd like to take a moment to thank all of the presenters, the panelists, the audience, and colleagues who pose in questions during the webinar today. I know our time has been short. There's still a lot of information to digest some questions we weren't able to get to. But I really hope that this is the beginning of a conversation. At IDRC, where I work in with our partners, we'll continue to develop ways of supporting local research and evidence on today's challenges. And the presentations we've seen today really emphasize and make clear that growing debt unfortunately is one of them adding to the pandemic and the climate crisis. It's impossible for me to try and sum up all of the rich information discussion we've had today, so I'm not going to try to do it in a sort of holistic way, but I will mention that from my point of view, one of the big takeaways is how important it is that we invest in local knowledge and capacity to manage the growing debt crisis. In particular, and I know it's something my colleagues following this session will be thinking more about is what more we can do to tackle the crises in an integrated manner. The integrated solutions that are needed to be both global and local, and we'll be working on expanding the platform that we have to amplify voices from the south, working with local researchers and network supporting the achievement of the SDGs. I think the presentations today gave us a rich basis for discussion and reflection and some clear priorities for debt management in the coming years. Issues around international architecture, which needs to be broadened including working more with the private sector and with other actors. National governments need to be in the driving seat of the management of debt and donors need to support this through mutually agreed and performance based frameworks. And as we've highlighted new approaches need to be both integrated and inclusive. I will highlight that today we've not said a lot about about inclusion, but on Thursday is the will be hosting another webinar that looks at how gender can be integrated into debt management. And then finally, I do want to pick up on something that Ambassador Ray mentioned and many of you mentioned around the urgency of the work that we need to do and the hard work that will be needed going forward. Let me thank you all for joining us today for being part of this discussion. I want to particularly thank our speakers, such a fantastic panel of people with such really deep and rich experience that they took the time to share for with us. We hope to see you again on Thursday in our webinar on gender and in the future as we continue this discussion. We wish you all to stay well and stay safe during these challenging times. Thanks very much.