UN Secretary-General's remarks at press encounter at G7 Summit, Hiroshima, 21 May 2023

OPENING REMARKS:  

Secretary-General: It’s a great pleasure to be back in Japan for this G7 Summit.  

My message to G7 leaders is clear: while the economic picture is uncertain everywhere, rich countries cannot ignore the fact that more than half the world – the vast majority of countries – are suffering through a deep financial crisis.  

The crushing economic impact of the COVID-19 pandemic, the climate crisis, Russia’s invasion of Ukraine, unsustainable levels of debt, rising interest rates and inflation are devastating developing and emerging economies.  

Poverty and hunger are rising; development is sinking. 

As I see it, the problems facing developing countries have three dimensions: moral, power-related, and practical.   

First, moral.  

There is a systemic and unjust bias in global economic and financial frameworks in favour of rich countries, which is naturally generating great frustration in the developing world.  

Access to COVID-19 vaccines was deeply unfair.  

The recovery has been extremely unbalanced. Rich countries recovered from the economic impact of the pandemic with expansionary monetary and fiscal policies. Trillions and trillions were spent. Basically, they printed money and spent their way out of trouble.  

But developing countries, many with substantial debts, were unable to do so. If they did, they would have seen their currencies sinking. 

On the other hand, the IMF allocated 650 billion US dollars in Special Drawing Rights – or SDRs – during the pandemic. The G7 countries, with a population of 772 million people, received 280 billion US dollars. The African continent, with 1.3 billion people, received only 34 billion US dollars.  

And this was done according to the rules. It was done by the book, but from a moral point of view, there is something fundamentally wrong with the rules themselves.   

Around the world, fifty-two countries are in technical default, at high risk of default, or face extremely expensive market financing. Middle Income Countries, including many small island developing states – with few exceptions – do not qualify for concessional funding and have no access to debt relief.   

Second, the power dimension.  

The Bretton Woods system and the Security Council reflect the power relations of 1945.  

And many things have changed since then. The global financial architecture became outdated, dysfunctional and unfair. 

In the face of the economic shocks from the COVID-19 pandemic and the Russian invasion of Ukraine, it has failed to fulfil its core function as a global safety net.  

It’s time to reform both the Security Council and the Bretton Woods institutions. 

This is essentially a question of redistributing power in line with the realities of today’s world.  

Third, the practical problem.  

Even within the present unfair global rules, more can and must be done to support developing economies.  

We have proposed an SDG Stimulus that would provide an effective mechanism for debt relief and scale up long-term and contingency funding.  

If Multilateral Development Banks would work together and changed their business models and approach to risk, they could leverage enormous amounts of private finance for developing countries at reasonable cost. And without a massive amount of private finance there would be no effective climate action and there would be no way to implement the Sustainable Development Goals. 

Massively reallocating SDRs – as Japan has done and others should follow –and channelling them through Multilateral Development Banks would have a multiplying effect on finance for sustainable development.   

Innovative financial tools could enable swaps that convert debt into investments in climate adaptation to build resilience in vulnerable communities around the world. 

The list goes on.  

But ladies and gentlemen of the media,  

G7 countries are also central to climate action.  

With the present policies, we are heading for a temperature rise of 2.8 degrees by the end of this century. The next five years are likely to be the hottest on record. 

Climate action is working but not enough and we are clearly off track to limit temperature rise to 1.5 degrees Celsius by the end of the century.  

The Acceleration Agenda I proposed aims to make up for lost time.    

It calls for all G7 countries to reach net-zero as close as possible to 2040, and for emerging economies to do so as close as possible to 2050.  

The Climate Solidarity Pact we suggested calls on all G7 countries, national and multilateral development banks, and the private sector, to mobilize financial and technical resources to support emerging economies that today are large emitters to accelerate decarbonization – so that we stay within the 1.5-degree limit of global heating.  

And this requires faster timelines to phase out fossil fuels and ramp up renewables.  

It means putting a price on carbon and ending fossil fuel subsidies. 

It’s high time for developed countries to provide the promised $100 billion US dollars per year.  

And the Loss and Damage Fund agreed in Sharm el-Sheikh must be operationalized.  

The city of Hiroshima is a testament to the human spirit. It’s my third visit to this city and I feel always very emotional when coming back. 

Whenever I visit, I am inspired by the courage and resilience of the hibakusha.  

The United Nations stands with them. We will never stop pushing for a world free of nuclear weapons.  

I thank Japan for its generous support to the Youth Leader Fund for a World Without Nuclear Weapons. We must invest in and empower today’s young people to be changemakers for a safer and more secure world.  

At the same time, Hiroshima is a global symbol of the tragic consequences when nations fail to work together and settle their differences peacefully.  

In our multipolar world, as geopolitical divisions grow, no country or group of countries can stand by as billions of people struggle with the basics of food, water, education, healthcare, and jobs.   

Here in Hiroshima, it’s time to demonstrate global leadership and global solidarity.  

Thank you.  

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QUESTION & ANSWER:

Question: Thank you very much for your time today and for making time for this news conference. You have very strong words for the current global institutions right now, calling them outdated and unfair. Do you think the same could be said for the G7 as well? And I think there was a lot of focus on engaging with the Global South at this summit? Perhaps with the understanding that traditional global institutions are becoming maybe obsolete and need to change. How successful do you think this G7 Hiroshima Summit has been in engaging the Global South? Thank you.  

Secretary-General: So, the G7 is a voluntary association. It is not an institution that is the defined by international law. The G7 as a voluntary association is free to do whatever its members decide. The Bretton Woods system and the Security Council are supposed to do what they were created for.  

What I believe is clear. It’s that there is a growing conscience in developed countries – and I felt it in the G7 – that not enough is being done,  both to reform outdated institutions and at the same time, to I would say remove the frustration of the Global South by an effective policy of solidarity with the Global South.  

We'll see now what is the impact of the discussions that were held here in Hiroshima, in which G7 members were able to discuss with some of the most important emerging economies in the world.  

Question: Thank you, Secretary-General. My question is about G7 leaders’ Hiroshima Vision document. This document states that nuclear weapons should serve defensive purposes, different aggression and prevent war and portion. What is your question about this part of a document, which can be understood as just justifying the position of nuclear weapons? And I would also like to know your opinion about the title of the document containing this sort of justification being entitled Hiroshima vision. Thank you.  

Secretary-General: Well, I'm not a commentator of documents. I think it's important to say what I believe should be done. I don't think we can give up on our main objective, which is to have a world free of nuclear weapons. And one thing that disturbs me is that disarmament that was moving forward quite positively during the last decades of the 20th century has completely stopped. And we are even seeing a new race to armaments. I think it is absolutely essential to reintroduce disarmament discussions about nuclear weapons and I think it is absolutely necessary that countries that own nuclear weapons commit not to do the first use of those weapons,, and I would say commit not to use them in any circumstance. And so, I think we need to be ambitious in relation to the capacity of one day, I hope still in my lifetime, to see this world without nuclear weapons. 

Question: James Bays from Al Jazeera. Secretary-General, firstly, on what you were talking about your bold plans for major change to the global financial architecture. Do you find the G7 listening seriously to you? And secondly on Ukraine, President Zelenskyy 

Here, it’s an issue that’s very important to this G7 and the key development seems to be that Ukraine is going to get F16 fighter jets. Is this an escalation or legitimate self-defense? 

Secretary-General: Well, first of all, in relation to the needs for reform of the international financial system, I had the occasion to express to the members of the G7 exactly what I have said today. And I would say that that there is a growing conscience that our international financial system is not able to respond to the challenges of today. The system was created, as I mentioned, in 1945. It was created reflecting the world at the time and the power relations at the time. This has changed. The economy has grown. The World Bank, to give you an example, has today, a paid-in capital that is in percentage of GDP less than one fifth of what it was in 1960. And everybody agrees that this is not a situation in which the present system is able to work as the global safety net that is supposed to be. And so, I felt that there was in the discussion a growing conscience that these questions of structural reform of the international financial system need to be addressed and there was an immediate positive response in relation to the reforms of the multilateral development banks. 

So, I hope that this difficult task will be able to start and I strongly encourage all countries developed and developing to work together to make it happen.  

In relation to the decisions about the situation in Ukraine. I have to say that I am not the Secretary-General of the G7, I'm the Secretary-General of the United Nations.  

Question: So, is it a good thing or a bad thing Secretary-General? 

Secretary-General: I think it's important that we reach a just peace based on international law, the charter of the United Nations and the respect for territory integrity. 

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