GENEVA: The rules-based international trade system is in danger, UN chief Antonio Guterres warned Wednesday, amid spiralling debt, heavy tariffs and financial insecurity for emerging nations.
Guterres said too many countries were trapped in a debt crisis, spending more money on servicing creditors than funding health and education.
“Global debt has soared. Poverty and hunger are still with us. The international financial architecture is not providing an adequate safety net for developing countries. And the rules-based trading system is at risk of derailment,” Guterres said at the UN Conference on Trade and Development in Geneva.
Guterres said trade and development was facing a “whirlwind of change”, with three-quarters of global growth now coming from the developing world, services trade surging and new technologies boosting the global economy.
However, geopolitical divisions, inequalities, conflicts and the climate crisis are limiting progress, the UN secretary-general said.
Furthermore, US President Donald Trump’s administration has slapped wide-ranging tariffs on other nations, triggering trade tensions around the globe.
Guterres acknowledged that “protectionism might be, in some situations, inevitable”, but, he stressed, “at least it should be rational”.
The UN chief warned that developing countries “continue to be short-changed”, with uncertainty rising, investment retreating and supply chains “in turmoil”.
“Trade barriers are rising, with some least developed countries facing extortionate tariffs of 40 percent, despite representing barely one percent of global trade flows,” he said.
“We see a rising risk of trade wars for goods”, while “military expenditure trends show that we are increasingly investing more in death than in people’s prosperity and well-being”.
Faced with these hazards, Guterres outlined four priorities for international action: a “fair global trade and investment system”, financing for developing countries, technology and innovation to stimulate the economy, and aligning trade policies with climate objectives.
Guterres said 3.4 billion people were living in countries that spend more on debt servicing than on health or education.
He called for lower borrowing costs and risks, and quicker support for countries facing debt distress.
Meanwhile global financial institutions need reforming so they better represent the needs of developing countries, he added.
The UN chief was set to launch later Wednesday the Sevilla Forum on Debt, aimed at tackling debt problems in developing countries by unlocking financing for developing countries, strengthening the ability to mobilise domestic funding, leveraging more private finance and tripling the lending power of multilateral development banks.
Guterres praised efforts to close the digital divide between wealthy and poor nations and ensure that technologies like artificial intelligence and blockchain become accessible to all countries, “not just rich ones”.
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