Under Time Pressure, FfD 3 Negotiators Grapple with Tax Matters, Political Issues
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The third drafting session of the outcome document of the third International Conference on Financing for Development (FfD 3) took place throughout the week of 15 June, and continued through the weekend, with the next plenary session expected to take place on Monday afternoon, 22 June.

In the course of plenary sessions and smaller, informal formats, delegations have considered three versions of the draft Addis Ababa Accord.

Key persistent differences included tax matters and "political issues."

ffd3-21jun22 June 2015: The third drafting session of the outcome document of the third International Conference on Financing for Development (FfD 3) took place throughout the week of 15 June, and continued through the weekend, with the next plenary session expected to take place on Monday afternoon, 22 June. In the course of plenary sessions and smaller, informal formats, delegations considered three versions of the draft Addis Ababa Accord. Key persistent differences included tax matters and “political issues.”

When the third FfD 3 drafting session opened on 15 June 2015, at UN Headquarters in New York, US, UN General Assembly President (UNGA) Sam Kutesa said negotiations had reached a critical and decisive stage, and called for consensus on an ambitious outcome. Wu Hongbo, UN Under-Secretary-General for Economic and Social Affairs, stressed the need for a holistic financing framework for sustainable development that will contribute to the success of the UN Summit to adopt the post-2015 development agenda, and the 2015 Paris Climate Change Conference.

George Talbot, Permanent Representative of Guyana to the UN and FfD 3 Co-Facilitator, and Geir Pedersen, Permanent Representative of Norway to the UN and FfD 3 Co-Facilitator, underlined the importance of concluding negotiations by the end of the week. Pedersen added that concluding negotiations was necessary to mobilize political support, and for additional commitments to be announced at FfD 3.

Delegates conducted a reading of the 12 June version of the draft Addis Ababa Accord, including both co-facilitator-prepared “bridging paragraphs,” and other text, on which divergences were considered greater.

The plenary was in suspension for Tuesday afternoon, part of Wednesday afternoon, and all but ten minutes of Thursday, while informal-informal discussions took place in smaller groups on issues including follow-up and review, international public finance, technology, tax, trade, debt and global partnership. These consultations were led by individuals tasked by the Co-Facilitators from several delegations to serve as “co-co-facilitators.”

To incorporate the “fruits” of the co-co-facilitated consultations, the Co-Facilitators released a new version of the outcome document on Friday morning, 19 June, and delegations began coordinating on the new text. Plenary convened very briefly late Friday afternoon, and South Africa, on behalf of the G-77/China, said several issues needed further work: poverty eradication; the principle of common but differentiated responsibilities (CBDR); official development assistance (ODA); follow-up and review; and tax matters. He appreciated the progress made thus far on the technology facilitation mechanism (TFM).

UNGA President Sam Kutesa addressed the plenary on Saturday morning, cautioning delegations against leaving the drafting to the final moment in Addis Ababa. Discussing the 19 June text in plenary session for several hours on Saturday, a couple of delegations noted its achievements, such as reviewing the FfD framework, and updating it with latest trends and with what will happen in September with regard to how the UN will support development for next 15 years. Throughout Saturday night, delegations worked in various informal settings to find solutions to remaining key differences.

Another version of the draft outcome document was issued on Sunday, 21 June. Around noon, Talbot said the work conducted overnight had closed many gaps, with significant progress made on: TFM; an infrastructure forum; and follow-up and review. He informed that tax cooperation and other matters remained outstanding. Talbot added that there would be important implications if the work did not conclude on Sunday. Pedersen said if the work did not conclude on Sunday, it would have to wait until the Addis conference. He highlighted the “historical responsibility” for the FfD process, the post-2015 development process, and the Paris Climate Change Conference, that “this gets off to a good start.”

The G-77/China commended the appointment of co-co-facilitators to focus on the key issues, noting that the text reflected improvements on follow-up and review, technology facilitation mechanism, parts of international public finance, and some aspects of trade. Challenges remained with regard to tax, peoples and countries under foreign occupation, and CBDR, he said. He also stressed the G-77/China’s concern about “making time so limited,” by calling to either conclude agreement during this session or meeting in Addis Ababa. The EU said that in addition to the issues mentioned by the G-77/China as still open, other issues remain to be finalized. He said if the opportunity is missed today, “we will have to go to Addis with an open text.” Benin reminded delegations that “consensus is what you can live with, even if you don’t like it.” The US said it still had many concerns with the text (tax, technology, follow-up and review, and political issues), and that if the process did not conclude on Sunday, the text will have to be finalized in Addis: “we are not willing to continue engaging here, without capital representation.”

President Kutesa again addressed the plenary, along with UN Deputy Secretary-General Jan Eliasson. Kutesa stressed that it would be unfortunate to go to Addis with unfinished text, because politicians are “the worst draftsmen.” He called on delegates to “finish today, if you can.” Eliasson said the importance of the FfD3 negotiation goes beyond keeping the momentum for the New York summit in September and Paris in December, but will “very seriously affect the way the world looks at the UN as a body to come up with solutions and formulas for international cooperation.” He also stressed that a good international formula is, “in today’s world, in the national interest.”

Negotiators continued working in smaller settings throughout Sunday. Late on Sunday evening, 21 June, the co-facilitators said the next plenary will convene on Monday afternoon, 22 June. FfD 3 convenes in Addis Ababa, Ethiopia, on 13-16 July 2015. [IISD RS Sources] [IISD RS Meeting Coverage]


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