FINNISH MINISTER TO PRESENT NEW TRANSATLANTIC AID

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SIPDIS

E.O. 12958: N/A
TAGS: EAID ETRD EU FI PREL
SUBJECT: FINNISH MINISTER TO PRESENT NEW TRANSATLANTIC AID
INITIATIVE AT UPCOMING PRAGUE MEETING

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1. At the upcoming Informal Council meeting in Prague
January 29-30, Finnish Minister for Foreign Trade and
Development Paavo Vayrynen will seek support from EU
Development ministers for the creation of a U.S.- EU
Transatlantic Partnership for Sustainable Development. The
purpose of the partnership would be to develop a coordinated
approach to aiding Least Developed Countries (LDCs) by
supporting poverty reduction strategies that are
ecologically, economically and socially sustainable.
Vayrynen briefed the Charge on the proposal January 27,
noting that some emerging economies played an outsized role
in drafting the Doha Declaration on Financing for Development
because the EU and the U.S. did not have a unified position.


2. A more coordinated approach, Vayrynen believes, will
strengthen common efforts to eliminate poverty and promote
sustainable development. Vayrynen said he had received a
favorable reaction from EU Commissioner Louis Michel and he
would "see what the reaction in Prague was." He expected
support from other Nordics, the British and the Dutch.
Vayrynen hopes that the proposal will also represent a new
constructive initiative from the EU to strengthen
transatlantic cooperation in general. He promised to brief
the Embassy following the Prague meeting, and asks that the
U.S. "sit back and watch" in the meantime.


3. Below is a copy of Minister Vayrynen's proposal sent by
him to all EU Development Ministers:

Begin text:

Proposal on Transatlantic Partnership for Sustainable
Development

In the midst of the global financial and economic crisis, we
are faced with great challenges in our development policy.
We have a heavy task in meeting our existing ODA commitments
while new financial obilgations are emerging in the Climate
Change negotitations. The global turmoil is creating
increasing difficulties to our partner countries in the
developing world. In order to reach the MDGs and the new
Climate Change goals we have to increase the overall
effectiveness of our development policies. We have to
reestablish the holistic view on development and environment
reached in Rio Conference 17 years ago. All development in
the world must be ecologically sustainable. Poverty
reduction can bring fast and lasting results only when our
development policies are economically and socially
sustainable.

Thus, an effort should be made to creat a Transatlantic
Partnership for Sustainable Development between the EU and
the United States with the objective to support the Least
Developed Countries (LDC) to reach a strong position in
tackling their future challenges. The enhanced cooperation
would benefit both the EU and the US and, above all,
strengthen our common efforts to eliminate poverty and
promote sustainable development all over the world. I think
the new U.S. administration, while considering new policies,
would welcome any new constructive initiatives from the side
of the EU to strengthen transatlantic cooperation. In my
view we have just now a great opportunity to move forward.

The common global agenda could be based on the following
elements:

Economic Sustainability

Economic growth based on trade, investments in productive
sectors and private sector development is the engine of
sustainable development and poverty reduction. The global
negotiations on trade, development and environment are
hampered by the imbalances amongst the developing countries
and the lack of coordination between the developed countries.
The WTO negotiations have been dominated by hard talks
between the industrialised countries and the emerging
developing countries. Still, Doha round is supposed to be
based on a development agenda.

The EU and some other developed countries have given the LDCs
a full quota and tariff free access to their markets. India
and China have made modest steps to the same direction. We
should support their efforts and encourage other middle and
high income level developing countries to do the same.

Through the Aid for Trade policies the EU together with a
number of other countries have taken steps to strengthen the
trading capacity of the developing countries. We encourage
the Southern donors and the sovereign wealth funds to do the
same.

Ecological Sustainability

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The comprehensive vision on environmental sustainability
reached in Rio in 1992 has been split and negotiations on
ecologically sustainable development are held in different
fora. At present, the most importan of them is the
negotiation process on the Climate Change.

As in the case of the WTO negotiations, also the Climate
Change negotiations are dominated by the developed countries
and the emerging developing countries. A common basis is the
prinicple of common but differentiated responsibility. The
industrialised countries are ready to accept deep cuts in
their carbon emissions if the developing countries are ready
to limit the growth of theirs. A precondition for an
agreement seems to be generous funding from the developed
countries to the developing countries for mitigation and
adaptation.

Climate Change policies must be coordinated with other
environmental policies, such as policies to protect the
biodiversity, to prevent desertification and to promote
sustainable forest management. There must also be proper
coordination with other development policies in order to
safeguard the overall sustainability.

Climate financing and development financing cannot be
separated and therefore all funding for mitigation and
adaptation in developing countries should be part of the ODA.
The funds should be administrated by the same institutions
and following the same principles and rules.

Social Sustainability

Social sustainability is often understood narrowly as a
satisfactory development of the social sector. However, the
foundation of social sustainability is formed by democracy,
good governance, and respect for the human rights. The
principles of social sustainability have been agreed upon in
numerous UN resolutions and declarations. The increasing gap
in income and wealth emerging in many developing countries
undermines the basis for sustained economic and social
development.

We must also encourage the developing countries to pursue
inclusive social policies and to implement effective poverty
reduction programmes. We must urge the donor community as a
whole to promote social sustainability in all its forms.

Finally, we must also strive for greater convergence in the
development policies of all the donors and the partners.
While Northern donors should do more in building
infrastructure, developing productive sectors and supporting
private sector development, Southern donors should be more
active in pimrary education, health and other social sectors
where they have, based on their own history, invaluable
experience and expertise. And we all should follow the
principles of sustainable development.

I propose that the EU would make an initiative to the US on
the Partnership as soon as possible and start to discussion
how to take it forward without delay.



BUTLER