UN chief says existing financial structure outdated, contributing to inequalities

PARIS

The UN chief said on Thursday the existing international financial structure is outdated and contributing to increasing inequalities.

“We don't have to wait for root and branch reform of the international financial architecture. We can take steps right now – and take a giant leap towards global justice,” said UN Secretary-General Antonio Guterres during the Summit for a New Global Financial Pact.

He also suggested a stimulus package of $500 billion annually to address climate change.

The summit, taking place in Paris on Thursday and Friday, brings together around 50 heads of state, along with representatives from international institutions and civil society.

Their discussions will revolve around reforming the international financial system, with a specific focus on empowering the most vulnerable countries in the South to tackle poverty and climate change.

French President Emmanuel Macron earlier stressed the need for substantial increases in private funding and a significant overhaul of public finances to effectively address these challenges.

Ugandan activist and UNICEF ambassador Vanessa Nakate, who spoke after Macron, asked attendees to observe a minute of silence "for all those who are already suffering and who are hungry, who are displaced, who drop out of school."

In her speech, Nakate also listed the many effects of global warming, including food insecurity, in the African continent and waves of heat in India.

She also called for "a fair exit from fossil fuels," directly referring to the profits of Western oil companies. "Broken promises cost lives," she added.

In her address to the summit, Barbados Prime Minister Mia Mottley also called for an "absolute transformation" of the financial system, and not just "a reform of our institutions."

Barbados, a small island in the Caribbean with a population of around 300,000, has a long history of dealing with the challenges posed by climate change.

The country has come up with a proposal that outlines how the global financial system can be improved to support developing nations to reduce the effects of climate change.