Financing common public goods such as measures to combat climate change and international financial instability requires multilateral co-operation between developing and developed actors, says Kemal Dervis.
As I have argued in a number of different forums, there are two sides to the operational dimension of international co-operation. One side is grounded in universal moral and ethical principles of assisting the poor and vulnerable. Richer countries and individuals channel resources to help with the development process of poorer countries and to assist those that are vulnerable as a result of conflict or natural disasters in developing countries.
While it is the case that helping developing countries indirectly benefits richer countries (since creating a fairer world without extreme poverty will help reduce the causes for grievances and contribute to a safer world), this motivation for providing development assistance is, essentially, altruistic.
But there is a second side to international co-operation. It relates to issues that affect all countries, and that typically require some degree of co-operation by all. Examples include the technical protocols that enable cross-country phone calls, the rules and regulations that permit international civil aviation, the rules that govern multilateral trade, and the response to global diseases, to name but a few. Addressing these issues, more often than not, requires cooperation. Fortunately, it is also, in most cases, in everyone’s best interest to co-operate.
The eradication of smallpox is one clear example of success in pursuing this common interest goal, which is also a global public good. No citizen in any country in the world can be excluded from benefiting from the fact that this disease has been wiped out worldwide – and the fact that one country benefits from it, does not preclude, in the least, all the others from benefiting from it also.
I recently served as a member of the International Task Force on Global Public Goods, chaired by the former president of Mexico, Ernesto Zedillo, where we focused on this second dimension of international co-operation. The task force considered past achievements in successfully addressing these types of challenges and tried to determine whether we in the international community are doing enough to provide global public goods.
Global partnerships
Looking at past successes highlights the way in which international co-operation can successfully lead to the provision of global public goods. Multilateral organisations are important in this process, from the technical agencies affiliated with the UN system that provide codes and standards for telecommunications or maritime shipping, to the World Trade Organisation, which manages the rules that govern multilateral trade.
But the task force’s challenge was primarily to map out the global public goods that are currently inadequately provided and to suggest ways in which provision could be enhanced.
The list of global public goods in short supply is long, and will probably increase with the gathering pace of interdependence that characterises globalisation. The task force included among those requiring priority action the control of infectious diseases, tackling climate change, enhancing international financial stability, improving the rules governing multilateral trade, achieving peace and security, and generating knowledge.
The task force emphasised the need for a multilateral approach to increasing the supply of these global public goods, rejecting the idea of a centralised approach by some sort of ‘world government’ as impractical, unfeasible, and undesirable. We suggested that part of the solution would have to involve working with current multilateral institutions, but also called for reforms to nudge national governments and multilateral institutions towards more decisive action.
Part of the solution would be to ensure that the views of developing countries are better represented in multilateral decision-making bodies, and to ensure that the decision-making structures better reflect today’s world in terms of economic and political power and influence.
Action catalyst
The task force also highlighted the need for a forum to complement existing multilateral institutions. We called for the establishment of the ‘Global 25’: a group of country leaders that would build on the existing ‘Finance’ G20, and serve as a forum to catalyse action in the provision of global public goods – including on the key issues of financing. It would not be a formal decision-making body, but would work as a catalyst for action and financing.
It would extend the G8 – which excludes emerging economies and developing countries – and expand further the G20, to include a broader representation of global perspectives.
While the increase in the supply of global public goods has been convincingly shown to be a very good investment, the up-front costs and the way in which these are distributed create serious difficulties for action.
For example, take climate change. Most of the widely accepted scientific evidence suggests that, globally, the costs of taking action to reduce the greenhouse gases emissions pale in comparison with the likely benefits of action. But important issues remain in terms of how these are distributed across regions and across countries in different stages of development.
Financing initiatives
The report of the task force suggests that there are no simple answers to these financing issues. But through a combination of discussions in a forum such as the Global 25 and the use of better allocation of resources, including through the use of innovative financing arrangements, real progress could be made.
As we address these complex issues, there are, clearly, real difficulties that the task force did not shy from tackling. But I am confident that with renewed multilateral engagement by countries, a more effective structure and use of multilateral organisations, a better forum for discussion and deliberations, and innovative thinking and financing, we can make real headway in increasing the supply of the global public goods that we all need to protect and promote our health, prosperity and security, and that of future generations.
Kemal Dervis is administrator of the United Nations Development Programme (UNDP).
