sustainable development 20 years on from the ... - José Eli da Veiga

<strong>20</strong>7
There are also other initiatives, such as the United Nations Collaborative Programme on
Reducing Emissions from Deforestation and Forest Degradation in Developing Countries (UN-REDD),
set up jointly by the Food and Agriculture Organization of the United Nations (FAO), UNDP and UNEP,
and the MDG Achievement Fund (MDG-F), established under an agreement between UNDP and Spain,
in which climate change is one of the thematic areas.
National <strong>development</strong> finance institutions have also deployed instruments for supporting
environmental and <strong>sustainable</strong> <strong>development</strong> projects (see ALIDE, <strong>20</strong>11). Putting the Brazilian National Bank
for Economic and Social Development (BNDES) in charge of managing the Amazon Fund in <strong>20</strong>08 helped
boost BNDES environmental operations. The Amazon Fund finances projects to reduce CO 2 emissions caused
by deforestation. It is authorized to raise funding proportional to emissions reductions achieved. The first
donors were Norway, Germany and Petrobras (see [online] www.fundoamazonia.gov.br).
4. International loans
Owing to commitments arising from their high levels of external debt, many developing countries are
facing constraints when formulating <strong>sustainable</strong> <strong>development</strong> strategies and allocating resources to
environmental protection.
Countries that have a high level of external debt in relation to their capacity to generate export
earnings thus have limited capacity to attract new financing, and this could have a negative impact on
domestic investment (ECLAC, <strong>20</strong>01).
Although the region’s external debt rose from US$ 470 billion in 1992 to nearly twice that
amount in <strong>20</strong>09 (ECLAC, <strong>20</strong>10a), total debt as a percentage of goods and services exports declined
sharply, from 245% in 1992 to 102% in <strong>20</strong>10, thanks to its robust export performance. 6
The region’s debt-to-GDP ratio also improved during that period, as a result of GDP growth,
dropping sharply from 37% in 1992 to 19% in <strong>20</strong>10 (see figure V.5).
Countries (mostly in South America) that export hydrocarbons and mining products benefited
from the rising trend of international commodity prices starting in <strong>20</strong>03. Those countries have seen a
sustained reduction in their external debt-to-GDP ratios since the start of the price upswing in <strong>20</strong>02, due
to the buoyancy of regional GDP in this phase.
The external price cycle over the past decade did not translate into a similar terms-of-trade
improvement for Central American and Caribbean countries. Nonetheless, Central America has obtained
a sustained reduction in its relative indebtedness —as a result of the Heavily Indebted Poor Countries
(HIPC) initiative in the cases of Honduras and Nicaragua, among others, and the maintenance of low
external debt levels in the cases of Costa Rica and Guatemala. In contrast, the Caribbean is not yet
showing a clear debt reduction trend. In fact, both the debt-to-GDP ratio and the interest payments to
exports ratio began to rise steadily at the end of the 1990s. This subregion is the most vulnerable one in
this respect (see figure V.6) (United Nations, <strong>20</strong>10a).
6
World Bank data, World Development Indicators.