Development Finance Talks In Ethiopia On Brink Of Collapse

Development Finance Talks In Ethiopia On Brink Of Collapse

By Katy Migiro | From Reuters via Daily Mail

Talks between rich and poor countries in the Ethiopian capital, aimed at agreeing on the financing of the United Nations’ bold new global development agenda, are on the brink of collapse, advocacy groups said on Wednesday.

The G77 developing countries want the final document, due to be signed when the Financing For Development (FfD) conference closes on Thursday, to include the creation of a new U.N. tax body which they hope would set new global rules to stop tax dodging.

The proposal is fiercely opposed by the rich members of the Organisation for Economic Cooperation and Development (OECD), which drew up the current tax rules.

“Negotiations are on the brink of collapse,” the European Network on Debt and Development said in a statement.

“Rich country governments led by the U.S., the U.K. and Japan are jeopardising the entire FfD agreement as they refuse to consider an inter-governmental tax body.”

Nearly $1 trillion in illicit finance – the fruits of tax evasion, crime and corruption – is estimated to leave poor countries each year, according to Global Financial Integrity, a policy research group.

The G77 wants the current U.N. tax committee to be upgraded to a political body with more power and money and universal membership.

A compromise proposal put forward by South Africa and the host nation, Ethiopia, was rejected on Wednesday morning, charities said.

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