UNIDO LDC M INISTERIAL C ONFERENCE 2015: O PERATIONALIZING ISID FOR LDC S : “T HE PATH TO GRADUATION AND BEYOND ” November 2015 Vienna, Austria Bhumika Muchhala Senior Policy Researcher, Finance and Development Programme Third World Network (TWN) TWN Third World Network

The UN Equation: SDGs and FfD Incorporation of SDG Goal 9 and ISID as an independent goal is actually a remarkable feat. The SDGs are a step forward from the MDGs: negotiated by all governments, universality, three indivisible pillars of economy, society and environment The SDGs contain Means of Implementation (MoI) and explicit goals on the economic pillar that support ISID. MoI encompasses financial resources, technological development and transfer and capacity building.

Financing for Development (FfD) The outcome of the third Financing for Development conference in Addis Ababa is meant to serve the effective purpose of facilitating the MoI for the SDGs. No new financial commitments, but 3 key deliverables serve SDG Goal 9 on ISID, resilient infrastructure and technological capacity building: 1. Technology Facilitation Mechanism - (established in paragraph 123 of FfD and embodied in SDG Target Global Infrastructure Forum – (paragraph 14 of FfD) 3. Illicit financial flows, tax evasion and avoidance – (paragraph 23 of FfD)

Structural Transformation: Building Productive Capacities The UN system (from IPOA, UNIDO’s Lima Declaration to the SDGs) recognizes that developing domestic productive capacities are the key to achieving ISID, eradication of poverty and economic and social development in LDCs. Six areas where the relaxation of constraints on the development of productive capacities in LDCs are important:  Public investment and infrastructure: (a) scaling up public investment, (b) redirecting ODA and development finance and (c) mobilizing private sector investments.  Nurturing SMEs: (a) access to domestic credit, (b) backward and forward linkages, (c) strengthening competitiveness of local suppliers, (d) regulating government procurement and (e) fostering linkages with large firms.

Structural Transformation: Building Productive Capacities (3) Financial inclusion and access to domestic credit: (a) loan guarantee schemes, (b) public development banks, (c) value chain lending and (d) innovative financial instruments. * Women’s access to credit and financial resources. (4) Technology: SDG target 9.b: developing and utilizing the UN’s new Technology Facilitation Mechanism (5) Jobs: Wage-based employment creation and increasing labour productivity requires multifaceted strategies, such as agricultural growth linkages (6) Gender equality: Gender mainstreaming policies and initiatives. Avoiding the instrumentalisation of women; emphasising instead women’s rights.

Three ways forward 1. Regional economic integration (a) Coordinating industrial policies at the regional level to ensure all countries gain; (b) Regional trade offers potential for more diversified products; and, (c) Cross-border infrastructure projects (with attention to fiscal, debt and social impact risks) 2. Social dialogue, impact assessments (a) Reconciles conflicts, heeds to interests and needs of local populations; and, (b) Rigorous evaluation impacts to learn from experience by measuring performance. 3. Developmental state is important, active leadership role and national development strategies