Hala El-Said, Minister of Planning and Economic Development participated, via video conference, in the Finance Ministers' meeting on financing the 2030 Agenda and its Sustainable Development Goals (SDGs) in the Era of COVID-19 and Beyond initiative.
El-Said began her speech during the meeting by shedding light on the situation ahead of the COVID-19 crisis, during which we are witnessing an unprecedented period, pointing out that the majority of developing countries faced financing challenges before the crisis with high levels of debt, and official development assistance came less than what countries committed to.
"It is very important, in light of these new challenges that we are facing, to determine the size of the financing needs and draw the framework to meet these needs and persify the various funding sources," the minister added.
The overall goal of the finance ministers meeting is to present to heads of state and government one ambitious list of policy options to recover from the current crisis in the short term and mobilize financial resources to achieve the 2030 Agenda and its Sustainable Development Goals (SDGs).
She pointed to the need to support innovative financing mechanisms such as green bonds, and encourage the establishment of various types of sovereign wealth funds, noting the need to support the debt relief mechanism through expanding the debt swap mechanism to finance investment directed towards SDGs.
"There is a need to establish a global or regional solidarity fund, taking into account support for countries that have been severely affected by the COVID pandemic, especially ones that depend on foreign funds and are poor in resources," she pointed out.
With regard to remittances from workers abroad, she added that in some middle-income countries they represent about 40% of foreign exchange sources, noting the importance of reducing the cost of international parcel, and also supporting the informal sector, as it represents in Egypt about 45% of the volume of employment and about 60% of the employment volume in middle-income countries.
El-Said pointed out that the current COVID crisis highlighted the urgent need to design labor market programs, such as plans to provide insurance for employees in the public sector in order to absorb those who lost their jobs, especially informal ones, referring to the funds provided by the Egyptian during the corona crisis as a kind of emergency aid for workers.
The minister added the need to reduce the cost of integration into the formal sector by reducing taxes or applying a fixed tax and facilitating registration procedures to stimulate integration in the sector, in addition to increasing the return from entering this sector, such as facilitating access to finance and training, especially for small and medium-sized enterprises (SMEs).
The Minister of Planning and Economic Development concluded her speech by stressing that there is no one solution that fits all the current challenges, yet, there is a need to come up with comprehensive policy options that are suitable for various countries according to their needs, noting that the pandemic has highlighted our lack of immunity from natural threats, and created an opportunity to enhance SDGs during recovery.
It is noteworthy that The pandemic and precautionary measures to, such as lock downs and travel restrictions, have put public health systems under stress and caused hundreds of millions around the world to lose their livelihoods overnight. As a result of the pandemic the world’s gross domestic product (GDP), foreign direct investment (FDI) and remittances are estimated to drop in 2020 by 4.9%, 40%, and 20%, respectively.
In addition, in the second quarter of the year, hours of work dropped 14%, equivalent to a loss of 400 million full-time jobs, and global merchandise trade declined by 18.5%.
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