International Monetary Fund (IMF)
Information
  • Date submitted: 1 Nov 2011
  • Stakeholder type: United Nations & Other IGOs
  • Name: International Monetary Fund (IMF)
  • Submission Document: Download
Keywords: Fiscal instruments (0 hits), fiscal policy (1 hits),

Full Submission

Preparations for the United Nations Conference on Sustainable Development (UNCSD)

Input from the Staff of the International Monetary Fund

November 1, 2011

Expectations for the outcome of Rio+20, and a possible structure of the Outcome Document.

The central outcome of the UNCSD should be a renewed political commitment to the principles of sustainable development, and explicit recognition of the need for effective policy coherence and appropriate balance among the objectives of economic, social, and environmental policy at the national and the global levels. The interdependencies between global goals and aspirations and national interests and policy formulation should be underscored.

The UNCSD should also generate the recognition that sustainable development is a matter of concern for all states, not just developing countries. The structural transformations necessary for sustainability in economic, social and environmental terms pose challenges to all countries, whatever their stage of development. UNCSD should contribute to building and cementing the sense of common purpose and shared responsibility that will be necessary to tackle these challenges successfully.

We expect that the Conference will seek agreement on a set of sustainable development goals (SDGs) to succeed the MDGs. Any such agreement should build upon and extend the MDGs, covering core areas critical to the achievement of sustainable development, and set out a timetable for their elaboration and modalities for their monitoring. The design of SDGs should also reflect new approaches to measuring and valuing economic activity and social progress, to the extent that these are broadly accepted.

Finally, it would be useful if the UNCSD could foster greater political acceptance of the green economy by addressing explicitly the concerns expressed by some Member States?the fear that it could slow developing countries? growth trajectory, lead to green protectionism or otherwise adversely affect global and bilateral trade arrangements, or entail ?green conditionalities? as a by-product of financing arrangements. The UCSD could instead present the green economy concept as a series of concrete options and guiding principles for the transition to more sustainable forms of economic activity, and point to the already considerable experience that many countries have accumulated in implementing such policies without undermining their growth potential.

To achieve these objectives for the Conference, the Outcome Document should:

? Spell out in clear language the nature of the political commitment to sustainable development.

? Emphasize that sustainable development is a matter of managing structural transformation in a manner that is ecologically sustainable and compatible with advancing human development, and that its principles are applicable to all countries, whatever their stage of development.

? Underscore the ?global commons? that are involved, and that success depends ultimately on joint efforts guided by the principle of common but differentiated responsibilities.

? Address the improvements in governance systems at the national and international level that are essential for the required policy coherence.

Comments on existing proposals: sustainable development goals, and a revitalized global partnership for sustainable development

Sustainable development goals

The commitment to elaborate and pursue Sustainable Development Goals (SDGs), if adopted, would be one of the most important outcomes of the UNCSD. Such SDGs would capitalize upon the success of the MDGs in motivating national and collective action, and would be the natural extension and successor to the MDGs after 2015. The SDGs would need to be defined to cover all the key aspects of sustainable development and the interlinkages among them. They would likely require new and more comprehensive measurement systems that include an accounting of natural capital and resource stocks and assign an economic cost to their depletion. The indicators used to measure progress should be salient, simple, and applicable across all countries, and the targets should be set in terms of relative improvements. The parameters of effective national, regional and global monitoring and evaluation systems based on the principle of mutual accountability should also be clearly set out.

On a revitalized global partnership for sustainable development

A revitalized global partnership for sustainable development should be built on the principles of common but differentiated responsibilities and the complementarity of effort?all stakeholders should contribute according to their respective capacities to the achievement by all of the objectives of sustainable development.

A revitalized global partnership for sustainable development should focus on the areas where collective action and agreement is critical ? e.g. in mobilizing additional resources for financing the responses to climate change.

It is essential to avoid defining relationships in terms of the ?obligations? of some and the ?rights? of others?a partnership defined primarily in terms of financing by some, and claims to such financing by others will be doomed to fail.

Views on implementation and on how to close the implementation gap

Goals and commitments may be formulated globally, but implementation takes place primarily at the national level, underscoring the need to establish the link between national self-interest, which must guide national policy making, and these global goals and commitments. Regional organizations can play a critical role as bridge between national governments and international intergovernmental processes, especially the central UN in New York.

To facilitate the transition from agreement on global objectives to national implementation, there should be clarity on the implications of the set objectives?in terms of financial, human, technical and institutional resources, and the likely sources of these resources, in order for implementation to be properly planned and effectively carried out.

Areas where global agreement and the respect of commitments are necessary for effective national level implementation must be clearly identified. This would include, for example, decisions on emissions reductions or climate financing, or on trade, as well as commitments to provide financing, technology, market access, etc.

Effective implementation requires contributions from a wide range of stakeholders?some will contribute to the definition of norms and standards; some will provide inputs and support to the formulation of policy or the monitoring of its implementation; others will provide financing and/or technical assistance; some will concentrate on fostering compliance. With so many different stakeholders active in the various pillars, it is necessary to find ways to effectively coordinate their respective contributions.

Institutional Framework for Sustainable Development

Policy coherence and integration requires institutional arrangements to achieve balance across the various aspects and objectives of policy in each of the three pillars of sustainable development. Such arrangements generally exist at the national level, but may not be very effective, because of the differing influence of the various ministries and stakeholders.

Such explicit institutional arrangements for policy integration are lacking at the global level, making it more difficult to achieve coordination and coherence within the existing system of international institutions and organizations. The clearly defined mandates of the specialized agencies limit their ability to expand their normative and policy making roles beyond their traditional areas, making an organic integration of governance across the three pillars difficult under existing institutional arrangements.

Bringing these institutions together more effectively need not imply the creation of a new overarching institution with the authority to coordinate and harmonize across institutional mandates. This would entail significant costs in terms of time and resources, necessitate careful attention to avoiding overlap and duplication, and would require defining the institutional relationships between a new central institution and the existing institutions, particularly the independent specialized agencies with their autonomous governance structures.

Further deepening of the direct collaboration among agencies active in the different pillars would be a more promising approach to bringing about greater coherence and coordination in the near-term, and would be less costly or time-consuming than creating new structures. Such interagency collaboration, carried out within the respective mandate of each organization, would contribute to the integration of economic, social, and environmental considerations in the normative work and country-level operational activities of all the concerned agencies.

Such collaborative efforts at the country level will also help to address the lack of policy coherence across the three pillars at the national level and facilitate the implementation of policies for sustainable development. A greater integration of economic, social and environmental considerations at the country level would also facilitate an appropriate evolution of the institutional arrangements at the global level.

IMF Contribution to UNCSD

The IMF recognizes the potential nexus between macroeconomic stability and sustainable, equitable growth and their social, economic, and environmental impacts. Advice on macro-economic policies and structural reforms takes into consideration sustainable development priorities of recipient countries and the risk of adverse effects on the environment and social development. Moreover, the IMF is collaborating with UN Statistics Division and members of the Editorial Board on the revision of the System of Environmental and Economic Accounts to provide standard guidance on statistical measures of sustainable economic performance that will be essential in assessing progress toward sustainable development goals.

The green economy and the environment Over the past several years, the IMF has focused considerable attention on the areas of carbon markets and carbon taxation, energy subsidies, the taxation of natural resources, etc., as well as fiscal policies for correcting market externalities and creating appropriate incentives for the transition toward off public more sustainable patterns of production and consumption. Recent analytical work has focused on fiscal and macro issues relating to climate change, particularly in the context of the recovery from the crisis.

The IMF?s collaboration with UNEP on fiscal policy aspects of the green economy builds on this work, much of which is directly relevant to the UNCSD. Core aspects of this work could be presented at the Conference through a side event organized by the Fund, perhaps in collaboration with other institutions.

It will also be possible to present relevant work in other areas, such as the collaboration with the ILO on social protection floors, as well as internal work on a variety of issues. This could also include presentations on the initiative of the IMF?s Statistics Department to reduce the number and size of paper publications and increase the usage of online databases.
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