G77 Pushes for Reform of Global Financial System

The 3rd Global South Summit took place at the Munyoyo Commonwealth Resort in Uganda from 21 to 22 January 2024 with the laudable goal of “Leaving no one behind”. It is worth noting that it is the first time that the event is taking place in Africa.

During the welcome address, Ugandan President Yoweri Museveni underlined the urgency to reform the global financial system. In particular, the lending terms to developing countries which make up the #G77 by the World Bank (#WB) and International Monetary Fund (#IMF) must be ‘fairer and more equitable.’

Uganda President Yoweri Museveni Hosted and Chaired the 3rd South Summit
Uganda President Yoweri Museveni Hosted and Chaired the 3rd South Summit

“We support the urgent reform of the international financial architecture to ensure that it is fit for purpose to respond to the financing needs of developing countries. In our view, the international financial institutions and multilateral development banks must support the national priorities of developing countries without any conditionalities that infringe on these countries’ sovereignty.”

Ugandan President Yoweri Museveni

The United Nations Secretary-General Antonio Gutteres pursued in the same direction and qualified the current global financial system as ‘out of date, out of time and out of step.’ As a case in point, the sovereign rating system is biased against developing countries, thus limiting access to capital for their economic uplift.

“Let us face it: those that benefit most from the present global governance system are unlikely to lead its reform. So, momentum for change must come from you. I urge you to keep driving these efforts forward.”

UN SG Antonio Gutteres
Family Photo at 3rd South Summit in Uganda
Family Photo at 3rd South Summit in Uganda

In the same breath, he called for the reform of the United Nations Security Council (#UNSC) which is cramped by geopolitical calculations. Created after the 2nd World War to ensure peace and security, the composition and function of the UNSC are no longer ‘fit for purpose’ in the emerging new world order. In the cases of both Ukraine and Gaza, the UNSC has displayed its limitations. To maintain its credibility and effectiveness, the UN Security Council to be more inclusive and take into account the voice of the Global South.

He also criticized the developed nations who have been reluctant to make good on their commitment to provide USD 100 billion annually to fight #ClimateChange. He also urged for a prompt operationalization of the Loss and Damage Fund (#LDF) as agreed at #COP27.

The Summit concluded with a general consensus on the pressing need to have a more inclusive and effective #GlobalGovernance that “better recognizes and leverages the significance of the #GlobalSouth.“