Maldives proposes three solutions for finance shortage for small states
"We have been forced to choose whether to invest in clean water, or sewerage or erosion prevention”.
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By
Mohamed Muzayyin Nazim
President Mohammed Muizzu on Tuesday proposed three measures to address the problem of lack of funds for small island nations to achieve development goals.
The President made the remarks while addressing a high-level meeting on the sidelines of the Fourth Conference of Small Island Developing States (SIDS4) in Antigua and Barbuda.
The President said foreign aid to small island developing countries has been on a declining trend for the past 20 years. The President also noted that the international community has pledged to increase climate finance at the meetings held in Samoa in 2014 and Paris in 2015.
“And [this time] here, in Antigua, we are making even more ambitious commitments to increase funding for SIDS,” he said.
The President said:
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In order for the countries to move to the next stage of development, they need very high levels of concessional financing
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Many of the SIDS countries, including Maldives, have fallen out of the least developed countries category, but the progress came at a "high price"
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The cost of borrowing money from other countries has increased and the repayment period has become shorter
"It has deteriorated our financial situation to the extreme. It has taken us away from a sustainable path of debt and forced us into higher levels of indebtedness and downgraded our credit rating,"* he said.
"And the climate disaster has forced us to make difficult decisions. We have been forced to choose whether to spend money on new schools or sewerage. We have been forced to choose whether to invest in clean water, or sewerage or erosion prevention”.
The President proposed the following solutions to raise the money needed for small countries like Maldives:
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1-
Reforming the international financial system
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2-
Developed countries in collaboration with multilateral development banks and the private sector, increasing private finance for SIDS
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3-
Expanding the understanding of SIDS
“We are small countries and we should not limit our opportunities,” he said, adding that small nations should aim for higher goals.
"We should strive to go beyond the expected. In achieving such a vision, we must build on our own capacity. The capacity of the state [and] the productivity capacity [also]."
