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29 November 2008

His Excellency President Kikwete
Secretary General
Your Excellencies
Mr President

Allow me first to thank the Secretary General for allowing me to serve as his Special Envoy for this Conference. Six and a half years ago I had the privilege of working with Michel Camdessus in a similar role with respect to the Monterrey Conference. It has been a great honour to again advance the consensus on financing for Development, this time together with Frau Heidemarie Wieczorek-Zeul. When we prepared for the Monterrey Conference we did so under the shadow of 09/11. As the dust settled, world leaders were driven forward. We were determined that a new global partnership must be forged.

We had seen that systemic poverty is the ultimate systemic risk; that continuous war could only be averted through development. The visionary commitments we made at Monterrey continued to resonate, because they depended on a new spirit of cooperation. Each of us needed to take action, not because 'the other side' demanded it of us. Not because non-compliance would result in sanction or reprimand. We took action because we knew that adherence to our agreements and implementation of these actions was in our own very best interest.

Today we meet again under a dark cloud of senseless violence. This time the demon of terror has struck at the commercial capital of a developing country an act of senseless violence in one of the world's largest and fast growing emerging economies. At the same time, the commitments we made at Monterrey are being tested: the global engine that has driven our growth and development is broken. This time financial crisis has surfaced at the heart of the industrialised world. But it threatens to defeat our common purpose and push back the advances we have all made since the turn of the century.

We need to pause and understand the nature of this crisis. The financial crisis is spilling over into the real economy at unprecedented speed. Productive sectors without working capital and long-term finance are closing their doors on many millions living in the 'real world'. The reality of global recession calls for decisive and collective action to prevent another great depression.
We know that the headlines will draw our focus towards the erratic movements of stock price indices.

But we must keep our focus on the steady clamour that is rising outside the factory gates, and the silent reality of growing poverty.
As is the case for many low income countries, the crisis constitutes a major setback at a time when African economies were making significant progress. This comes on top of the food and fuel shocks, which pushed back the Millennium Development Goals (MDGs) by seven years and sent more than 100 million people back into poverty.

Many of the countries on our continent have built a solid platform of macroeconomic stability. But we have not yet completed the micro-economic reform, human development and infrastructure expansion that is vital to self-sustaining and broad-based growth of our continent. And now we face this profound setback, not of our own making. Mr President, procrastination. The negotiations on the outcome document have been terribly slow. There is a lack of urgency that does not speak to the reality of what is happening in the world. Future generations will judge us harshly if they find that, at the very moment that history required us to join hands in global solidarity, we were unable to rise above the petty animosities that cause us to look inward and fester.
Yesterday the Secretary-General convened a number of leaders to a retreat. All of us agreed that the issues that divide the negotiations are small and inconsequential compared to the challenges that the world now faces.
Our task is to lead the world through the change that is clearly required.

We need a text that speaks unequivocally of the changes we need. But like at Monterrey it must bring us together and not drive us further apart.
What is required is a spirit of compromise and real commitment to the task. I wish to join my friend and co-Special Envoy Heidemarie Wieczorek-Zeul in calling on all of you to assist in finding a workable solution, which is able to resonate beyond the confines of this conference room, and have meaning to the millions out there and well into the future. This is what we achieved at Monterrey; we dare not fail in Doha.

Mr. President, South Africa is privileged to sit in many different forums. We are Africans, and realise that our own development is inextricably bound to that of our continent. Like our African brothers and sisters we join the developing world in the G-77. South Africa's participation in the G-20 can in no measure substitute for proper representation for our continent.

Nevertheless, even as we militate for enhanced African representation, we will continue to engage with the G-20 as an important forum through which to forge the necessary compromises and mobilise the resources that we require to build a new economic multilateralism. Above all, we must work through all the institutions at our disposal, to devise an urgent and collective response to the global reality. If we don't unite in action to this crisis we will be selling the world's poor short. One critical response must be to make a bold and unambiguous commitment to maintain global solidarity.

In this context, we should welcome the many admirable pronouncements that have already been made at this podium. And we must again congratulate the actions of the five developed countries that have already attained the goal of 0,7 percent of GNI. Let us remember that adherence to such commitments is in our own very best interest. Despite their weakened state, financial markets continue to impose a cast iron discipline on errant sovereigns who fail to keep their bond, or deviate from the course of sustainable macroeconomic policy. But there is no equivalent mechanism that can force the obedience those who fail to keep their word in respect of global solidarity.

The only tools we have are the multilateral system. But if multilateral institutions are to work effectively, we must all yield up a measure of our national sovereignty.

At a global level there are many different institutions, each with its own capacities, strengths and weaknesses. Realising change will require them all to act in concert. When it comes to public governance, especially at a global level, there is nothing to be gained from competition between the United Nations, the Bretton Woods institutions, the World Trade Organisation (WTO) and the many other initiatives that exist to solve problems and bring us together on matters of policy. What is obviously required is greater collaboration. Can we not find a middle ground even between Washington and New York?

Mr President, Monterrey was an historic moment, made possible because the old zero-sum politics of cold war blocs had collapsed. The dead-weight of 'group think', which had held back consensus for more than a generation, finally lifted. In its place we were able to build a new partnership based on solidarity, mutual respect and collective action. President Sarkozy reminded us again when he addressed us this morning that we cannot build the world of the 21st century with the institutions of the 20th century. Clearly, the G-7 is one of those institutions that we must leave where it truly belongs in the history books that describe the twentieth century. But we must ask if it is the only
anachronism that holds us back. Perhaps, with the demise of the G-7 it is time that we reconsidered the G-77 as well.

Mr President

We cannot allow this conference to end in failure. We must sustain and build on the consensus we reached in Monterrey. It is more important that any of the small differences that divide us today.

I thank you.

Issued by: National Treasury
29 November 2008
Source: National Treasury (http://www.finance.gov.za/)