An updated draft of the outcome document for the Third International Conference on Financing for Development was released on 7 July 2015 following the consultations of the plenary. The co-facilitators have proposed this draft be transmitted to the Conference for further consideration. Extracts from this document are presented below.

I. A global framework for financing development post-2015

We, the Heads of State and Government and High Representatives, gathered in Addis Ababa, Ethiopia, from 13 to 16 July 2015, affirm our strong political commitment to address the challenge of financing and create an enabling environment at all levels for sustainable development in the spirit of global partnership and solidarity. We reaffirm and build on the 2002 Monterrey Consensus and the 2008 Doha Declaration. Our goal is to end poverty and hunger, and to achieve sustainable development in its three dimensions through promoting inclusive economic growth, protecting the environment, and promoting social inclusion. We commit to respect all human rights, including the right to development. We will ensure gender equality and women’s and girls’ empowerment. We will promote peaceful and inclusive societies and advance fully towards an equitable global economic system where no country or person is left behind, enabling decent work and productive livelihoods for all, while preserving the planet for our children and future generations.

In September of this year, the United Nations will host a Summit to adopt an ambitious and transformative post-2015 development agenda, including Sustainable Development Goals (SDGs). This agenda must be underpinned by equally ambitious and credible means of implementation. We have come together to establish a holistic and forward-looking framework and to commit to concrete actions to deliver on the promise of this agenda. Our task is threefold: to follow-up on commitments and assess the progress made in the implementation of the Monterrey Consensus and Doha Declaration; to further strengthen the framework to finance sustainable development and the means of implementation for the universal post-2015 development agenda; and to reinvigorate and strengthen the Financing for Development follow-up process to ensure that the actions to which we commit are implemented and reviewed in an appropriate, inclusive, timely and transparent manner.

We recognize that since the adoption of the Monterrey Consensus the world has made significant overall progress. Globally, economic activity and financing flows have increased substantially. We have made great progress in mobilizing financial and technical resources for development from an increased number of actors. Advances in science, technology and innovation (STI) have enhanced the potential to achieve our development goals. Many countries, including developing countries, have implemented policy frameworks that have contributed to increased mobilization of domestic resources and higher levels of economic growth and social progress. Developing countries’ share in world trade has increased, and while debt burdens remain, they have been reduced in many poor countries. These advances have contributed to a substantial reduction in the number of people living in extreme poverty and to notable progress towards the achievement of the Millennium Development Goals (MDGs).

Despite these gains, many countries, particularly developing countries, still face considerable challenges, and some have fallen further behind. Inequalities within many countries have increased dramatically. Women, representing half of the world’s population, as well as indigenous peoples and the vulnerable continue to be excluded from participating fully in the economy. While the Monterrey agenda has not yet been fully implemented, new challenges have arisen, and enormous unmet needs remain for the achievement of sustainable development. The 2008 world financial and economic crisis exposed risks and vulnerabilities in the international financial and economic system. Global growth rates are now below pre-crisis levels. Shocks from financial and economic crises, conflict, natural disasters, and disease outbreaks spread rapidly in our highly interconnected world. Environmental degradation, climate change, and other environmental risks threaten to undermine past successes and future prospects. We need to ensure that our development efforts enhance resilience in the face of these threats.

Solutions can be found, including through strengthening public policies, regulatory frameworks and finance at all levels, unlocking the transformative potential of people and the private sector, and incentivizing changes in financing as well as consumption and production patterns to support sustainable development. We recognize that appropriate incentives, strengthening national and international policy environments and regulatory frameworks and their coherence, harnessing the potential of STI, closing technology gaps and scaling up capacity-building at all levels are essential for the shift towards sustainable development and poverty eradication. We reaffirm the importance of freedom, human rights, and national sovereignty, good governance, rule of law, peace and security, combatting corruption at all levels and in all its forms, and effective, accountable, and inclusive democratic institutions at the sub-national, national and international levels as central to enable the effective, efficient and transparent mobilization and use of resources. We also reaffirm all the principles of the Rio Declaration on Environment and Development.

The enhanced and revitalized global partnership for sustainable development, led by governments, will be a vehicle for strengthening international cooperation for implementation of the post-2015 development agenda. Multi-stakeholder partnerships and the resources, knowledge and ingenuity of the private sector, civil society, the scientific community, academia, philanthropy and foundations, parliaments, local authorities, volunteers and other stakeholders will be important to mobilize and share knowledge, expertise, technology and financial resources, complement the efforts of governments, and support the achievement of the SDGs, in particular in developing countries. This global partnership should reflect that the post-2015 development agenda, including the SDGs are global in nature and universally applicable to all countries while taking into account different national realities, capacities, needs and levels of development and respecting national policies and priorities. We will work with all partners to ensure a sustainable, equitable, inclusive, peaceful and prosperous future for all. We will all be held accountable by future generations for the success and delivery of commitments we make today.

II. Action Areas

B. Domestic and international private business and finance

Private business activity, investment, and innovation are major drivers of productivity, inclusive economic growth, and job creation. We acknowledge the diversity of the private sector, ranging from micro-enterprises to cooperatives to multinationals. We call on all businesses to apply their creativity and innovation toward solving sustainable development challenges. We invite them to engage as partners in the development process, to invest in areas critical to sustainable development, and to shift to more sustainable consumption and production patterns. We welcome the significant growth in domestic private activity and international investment since Monterrey. Private international capital flows, particularly foreign direct investment (FDI), along with a stable international financial system, are vital complements to national development efforts. Nonetheless, we note that there are investment gaps in key sectors for sustainable development. FDI is concentrated in a few sectors in many developing countries and often bypasses countries most in need, and international capital flows are often shortterm oriented.

We will develop policies and, where appropriate, strengthen regulatory frameworks to better align private sector incentives with public goals, including incentivizing the private sector to adopt sustainable practices, and foster long-term quality investment. Public policy is needed to create the enabling environment at all levels and a regulatory framework necessary to encourage entrepreneurship and a vibrant domestic business sector. Monterrey tasked us to build transparent, stable and predictable investment climates, with proper contract enforcement and respect for property rights, embedded in sound macroeconomic policies and institutions. Many countries have made great strides in this area. We will continue to promote and create enabling domestic and international conditions for inclusive and sustainable private sector investment, with transparent and stable rules and standards and free and fair competition, conducive to achieving national development policies.

We will foster a dynamic and well-functioning business sector, while protecting labour rights and environmental and health standards in accordance with relevant international standards and agreements, such as the UN Guiding Principles on Business and Human Rights and the labour standards of the ILO, the UN Convention on the Rights of the Child and key multilateral environmental agreements, for parties to these agreements. We welcome the growing number of businesses that embrace a core business model that takes account of the environmental, social and governance impacts of their activities, and urge all others to do so. We encourage impact investing, which combines a return on investment with non-financial impacts. We will promote sustainable corporate practices, including integrating environmental, social, and governance factors into company reporting as appropriate, with countries deciding on the appropriate balance of voluntary and mandatory rules. We encourage businesses to adopt principles for responsible business and investing, and we support the work of the United Nations Global Compact in this regard. We will work towards harmonizing the various initiatives on sustainable business and financing, identifying gaps, including in relation to gender equality, and strengthening the mechanisms and incentives for compliance.

We acknowledge the importance of robust risk-based regulatory frameworks for all financial intermediation, from microfinance to international banking. We acknowledge that some risk-mitigating measures could potentially have unintended consequences, such as making it more difficult for MSMEs to access financial services. We will work to ensure that our policy and regulatory environment supports financial market stability and promote financial inclusion in a balanced manner, and with appropriate consumer protection. We will endeavor to design policies, including capital market regulations where appropriate, that promote incentives along the investment chain that are aligned with long-term performance and sustainability indicators, and that reduce excess volatility.

Many people, especially women, still lack access to financial services, as well as financial literacy, which is a key for social inclusion. We will work towards full and equal access to formal financial services for all. We will adopt or review our financial inclusion strategies, in consultation with relevant stakeholders, and will consider including financial inclusion as a policy objective in financial regulation, in accordance with national priorities and legislation. We will encourage our commercial banking systems to serve all, including those who currently face barriers to access financial services and information. We will also support microfinance institutions, development banks, agricultural banks, mobile network operators, agent networks, cooperatives, postal banks and savings banks as appropriate. We encourage the use of innovative tools, including mobile banking, payment platforms and digitalized payments. We will expand peer learning and experience sharing among countries and regions, including through the Alliance for Financial Inclusion and regional organizations. We commit to strengthen capacity development for developing countries, including through the UN development system, and encourage mutual cooperation and collaboration between financial inclusion initiatives.

We recognize the positive contribution of migrants for inclusive growth and sustainable development in countries of origin, transit and destination countries. Remittances from migrant workers, half of whom are women, are typically wages transferred to families, primarily to meet part of the needs of the recipient households. They cannot be equated to other international financial flows, such as FDI, ODA or other public sources of financing for development. We will work to ensure that adequate and affordable financial services are available to migrants and their families in both home and host countries. We will work towards reducing the average transaction cost of migrant remittances by 2030 to less than 3 per cent of the amount transferred. We are particularly concerned with the cost of remittances in certain low volume and high cost corridors. We will work to ensure that no remittance corridor requires charges higher than 5 per cent by 2030, mindful of the need to maintain adequate service coverage, especially for those most in need. We will support national authorities to address the most significant obstacles to the continued flow of remittances, such as the trend of banks withdrawing services, to work towards access to remittance transfer services across borders. We will increase coordination among national regulatory authorities to remove obstacles to non-bank remittance service providers accessing payment system infrastructure, and promote conditions for cheaper, faster and safer transfer of remittances in both source of origin and recipient countries, including by promoting competitive and transparent market conditions. We will exploit new technologies, promote financial literacy and inclusion, and improve data collection. We recognize that MSMEs, particularly women-owned MSMEs, often have difficulty in obtaining financing. To encourage increased lending to MSMEs, financial regulations can permit the use of collateral substitutes, create appropriate exceptions to capital requirements, reduce entry and exit costs to encourage competition and allow micro-finance institutions to mobilize savings by receiving deposits. We will work to strengthen the capacity of financial institutions to undertake cost-effective credit evaluation, including through public training programmes, and through establishing credit bureaus where appropriate. National development banks, credit unions, and other domestic financial institutions can play a vital role providing access to financial services. We encourage both international and domestic development banks to promote MSME finance, including in industrial transformation, through the creation of credit lines targeting MSMEs, as well as technical assistance. We welcome the work of the International Finance Corporation and other initiatives in this area, and encourage increased capacity building and knowledge sharing and at the regional and global levels. We also recognize the potential of new investment vehicles, such as development-oriented venture capital funds, potentially with public partners, blended finance, risk mitigation instruments, and innovative debt funding structures with appropriate risk management and regulatory frameworks. We will also enhance capacity building in these areas.

To meet longer-term financing needs, we will work towards developing domestic capital markets, particularly long-term bond and insurance markets where appropriate, including crop insurance on nondistortive terms. We will also work to strengthen supervision, clearing, settlement and risk management. We underline that regional markets are an effective way to achieve scale and depth not attainable when individual markets are small. We welcome the increase in lending in domestic currencies by MDBs, and encourage further growth in this area. We encourage development banks to make use of all risk management tools, including through diversification. We recognize that the nature of international portfolio investment has evolved over the past 15 years, and that foreign investors now play a significant role in some developing countries’ capital markets, and the importance of managing volatility associated with these. We will enhance international support in developing domestic capital markets in developing countries, in particular in LDCs, LLDCs and SIDS. We will work to strengthen capacity-building in this area, including through regional, inter-regional and global fora for knowledge sharing, technical assistance and data sharing.

We recognize the important contribution that direct investment, including FDI, can make to sustainable development, particularly when projects are aligned with national and regional sustainable development strategies. Government policies can strengthen positive spillovers from FDI, such as know-how and technology, including through establishing linkages with domestic suppliers, as well as encouraging the integration of local enterprises, in particular MSMEs from developing countries, into regional and global value chains. We will encourage investment promotion and other relevant agencies to focus on project preparation. We will prioritize projects with the greatest potential for promoting full and productive employment and decent work for all, sustainable patterns of production and consumption, structural transformation and sustainable industrialization, productive diversification and agriculture.

D. International trade as an engine for development

International trade is an engine for inclusive economic growth and poverty reduction, and contributes to the promotion of sustainable development. We will continue to promote a universal, rules-based, open, transparent, predictable, inclusive, non-discriminatory and equitable multilateral trading system under the World Trade Organization (WTO), as well as meaningful trade liberalization. Such a trading system encourages long-term investment in productive capacities. With appropriate supporting policies, infrastructure and an educated work force, trade can also help promote productive employment and decent work, women’s empowerment, and food security, as well as a reduction in inequality and contribute to achieving the SDGs.

We recognize that the multilateral trade negotiations in the WTO require more effort, although we regard the approval of the Bali Package in 2013 as an important achievement. We reaffirm our commitment to strengthening the multilateral system. We call on members of the WTO to fully and expeditiously implement all the decisions of the Bali Package, including the decisions taken in favour of LDCs, the decision on public stockholding for food security purposes, and the Work Programme on Small Economies, and to expeditiously ratify the Agreement on Trade Facilitation. WTO members declaring themselves in a position to do so should notify commercially meaningful preferences for LDC services and service suppliers in accordance with the 2011 and 2013 Bali decision on the operationalization of the LDCs services waiver and in response to the LDCs collective request.

We acknowledge that lack of access to trade finance can limit a country’s trading potential, and result in missed opportunities to use trade as an engine for development. We welcome the work carried out by the WTO Expert Group on Trade Financing, and commit to explore ways to use market-oriented incentives to expand WTO-compatible trade finance and the availability of trade credit, guarantees, insurance, factoring, letters of credit and innovative financial instruments, including for MSMEs in developing countries. We call on the development banks to provide and increase market-oriented trade finance and to examine ways to address market failures associated with trade finance.

Whereas, since Monterrey, exports of many developing countries have increased significantly, LDCs, LLDCs, SIDS’ and Africa’s participation in world trade in goods and services remains low and world trade seems challenged to return to the buoyant growth rates seen before the global financial crisis. We will endeavour to significantly increase world trade in a manner consistent with the SDGs, including exports from developing countries, in particular from LDCs with a view towards doubling their share of global exports by 2020 as stated in the Istanbul Programme of Action. We will integrate sustainable development into trade policy at all levels. Given the unique and particular vulnerabilities in SIDS, we strongly support their engagement in trade and economic agreements. We will also support the fuller integration of small, vulnerable economies in regional and world markets.

As a means of fostering growth in global trade, we call on WTO members to redouble their efforts to promptly conclude the negotiations on the Doha Development Agenda and reiterate that development concerns form an integral part of the Doha Development Agenda, which places the needs and interests of developing countries, including LDCs, at the heart of the Doha Work Programme. In that context enhanced market access, balanced rules, and well targeted, sustainably financed technical assistance and capacity-building programmes have important roles to play. We commit to combat protectionism in all its forms. In accordance with one element of the mandate of the Doha Development Agenda, we call on WTO Members to correct and prevent trade restrictions and distortions in world agricultural markets, including through the parallel elimination of all forms of agricultural export subsidies and disciplines on all export measures with equivalent effect. We call on WTO Members to also commit to strengthen disciplines on subsidies in the fisheries sector, including through the prohibition of certain forms of subsidies that contribute to over-capacity and overfishing in accordance with the mandate of the Doha Development Agenda and the Hong Kong Ministerial Declaration. We urge WTO members to commit to continuing efforts to accelerate the accession of all developing countries engaged in negotiations for WTO membership and welcome the 2012 strengthening, streamlining and operationalising of the guidelines for the accession of LDCs to the WTO.

Members of the WTO will continue to implement the provisions of special and differential treatment (S&D) for developing countries, in particular LDCs, in accordance with WTO agreements. We welcome the establishment of the monitoring mechanism to analyse and review all aspects of the implementation of S&D provisions, as agreed in Bali, with a view to strengthening them and making them more precise, effective and operational as well as facilitating integration of developing and least-developed WTO members into the multilateral trading system.

We call on developed country WTO members and developing country WTO members declaring themselves in a position to do so to realize timely implementation of duty-free and quota-free market access on a lasting basis for all products originating from all LDCs, consistent with WTO decisions. We call on them to also take steps to facilitate market access for LDC products including by developing simple and transparent rules of origins applicable to imports from LDCs, in accordance with the guidelines adopted by WTO members at the Bali ministerial conference in 2013.

We reaffirm the right of WTO members to take advantage of the flexibilities in the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) and reaffirm that the TRIPS Agreement does not and should not prevent members from taking measures to protect public health. To this end, we would urge all WTO Members that have not yet accepted the amendment of the WTO TRIPS Agreement allowing improved access to affordable medicines for developing countries to do so by the deadline of the end of the year. We welcome the June 2013 decision to extend the transition period for all LDCs. We invite the General Council to consider how the WTO can contribute to sustainable development.

We recognize the significant potential of regional economic integration and interconnectivity to promote inclusive growth and sustainable development, and commit to strengthen regional cooperation and regional trade agreements. We will strengthen coherence and consistency among bilateral and regional trade and investment agreements, and to ensure they are compatible with WTO rules. Regional integration can also be an important catalyst to reduce trade barriers, implement policy reforms and enable companies, including MSMEs, to integrate into regional and global value chains. We underline the contribution trade facilitation measures can make to this end. We urge the international community, including international financial institutions and multilateral and regional development banks, to increase its support to projects and cooperation frameworks that foster regional and subregional integration, with special attention to Africa, and that enhance participation and integration of small-scale industrial and other enterprises, particularly from developing countries, into global value chains and markets. We encourage MDBs, including regional banks, in collaboration with other stakeholders, to address gaps in trade, transport and transit related regional infrastructure, including completing missing links connecting LLDCs, LDCs and SIDS within regional networks.

Recognizing that international trade and investment offers opportunities but also requires complementary actions at the national level, we will strengthen domestic enabling environments and implement sound domestic policies and reforms conducive to realising the potential of trade for inclusive growth and sustainable development. We further recognize the need for value addition by developing countries and for further integration of MSMEs into value chains. We reiterate and will strengthen the important role of the United Nations Conference on Trade and Development (UNCTAD) as the focal point within the United Nations system for the integrated treatment of trade and development and interrelated issues in the areas of finance, technology, investment and sustainable development.

We endorse the efforts and initiatives of the United Nations Commission on International Trade Law, as the core legal body within the United Nations system in the field of international trade law, aimed at increasing coordination of and cooperation on legal activities of international and regional organizations active in the field of international trade law and at promoting the rule of law at the national and international levels in this field.

Aid for Trade can play a major role. We will focus Aid for Trade on developing countries, in particular LDCs, including through the Enhanced Integrated Framework for Trade-Related Technical Assistance to LDCs. We will strive to allocate an increasing proportion of Aid for Trade going to LDCs, provided according to development cooperation effectiveness principles. We also welcome additional cooperation among developing countries to this end. Recognizing the critical role of women as producers and traders, we will address their specific challenges in order to facilitate women's equal and active participation in domestic, regional and international trade. Technical assistance and improvement of trade- and transit-related logistics are crucial in enabling LLDCs to fully participate in and benefit from multilateral trade negotiations, effectively implement policies and regulations aimed at facilitating transport and trade, and diversify their export base.

The goal of protecting and encouraging investment should not affect our ability to pursue public policy objectives. We will endeavour to craft trade and investment agreements with appropriate safeguards so as not to constrain domestic policies and regulation in the public interest. We will implement such agreements in a transparent manner. We commit to support capacity building including through bilateral and multilateral channels, in particular to LDCs, in order to benefit from opportunities in international trade and investment agreements. We request UNCTAD to continue its existing programme of meetings and consultations with Member States on investment agreements.

We also recognize that illegal wildlife trade, illegal unreported and unregulated fishing, illegal logging, and illegal mining are a challenge for many countries. Such activities can create substantial damage, including lost revenue and corruption. We resolve to enhance global support for efforts to combat poaching and trafficking of protected species, trafficking in hazardous waste, and trafficking in minerals, including by strengthening both national regulation and international cooperation, and increasing the capacity of local communities to pursue sustainable livelihood opportunities. We will also enhance capacity for monitoring, control and surveillance of fishing vessels so as to effectively prevent, deter and eliminate illegal, unreported and unregulated fishing, including through institutional capacity building.

» Download the previous Revised Draft Outcome of 6 May 2015 here.