To create development we need innovative financing

To create development we need innovative financing

"It is time that we embrace the concept of a financial transactions tax". This is the message from world leaders and civil society who met recently to discuss innovative financing for development.

Comms

An international symposium on innovative financing mechanisms (IFM) and the financial transactions tax (FTT) was held in Tokyo on October 11. This event was an opportunity to discuss how innovative financing initiatives can make a positive contribution in addressing the challenges of financing for development.

PSI Japanese affiliate JICHIRO was an active partner in the meeting, along with PSI’s Asia-Pacific regional office. Other partners in the symposium were the NGO Forum for International Solidarity Levies, UGOKU-UGOKASU (GCAP Japan), the Parliamentary Group for international solidarity levies and the Leading Group on innovative financing for development.

Forum participants agreed that the FTT appears as one of the best options to better regulate financial markets and secure a fair and moral contribution from the financial sector to address the costs of the financial crisis.

Fiscal consolidation and budgetary adjustment prompted by the fiscal crisis have forced reductions in funding for development or ODA (Official Development Assistance). Last year, total funds allocated for ODA fell below the level of previous year for the first time in 14 years. It is essential that those actors responsible for the financial crisis contribute to repairing the damage they’ve caused.

Revenues from the FTT could help supplement the national budget, provide additional funds for tackling global challenges such as poverty, and address the need to control speculative short-term transfer of funds as regulatory measures for the financial sector.

The forum participants adopted a global appeal to aim for national as well as global shifts in the current paradigms by embracing the global wave for IFM, including the FTT.

In addition, PSI Regional Secretary Lakshmi Vaidhiyanathan participated in discussions organised by the annual meeting of the World Bank/IMF on the role of Asia and the changing trends, commitment to growth, a talk show organised by BBC, and a panel on the Euro crisis.These discussions included many references to the FTT.