HISTORIC PRESS RELEASE : Doubling Aid to Halve Poverty [January 2003]

The press release issued by HM Treasury on 23 January 2003.

A proposal for an International Finance Facility which could double the amount of development aid provided by the richest countries to the poorest was published today by Chancellor Gordon Brown and International Development Secretary Clare Short.

The Facility is designed to provide additional financing to help meet the internationally agreed Millennium Development Goals so that by 2015 every child is in education, infant mortality is reduced by two thirds and maternal mortality by three quarters, and poverty is halved.

The founding principle of the new International Finance Facility (IFF) is long-term, but conditional, funding guaranteed to the poorest countries by the richest countries. On the basis of these long-term donor commitments, the Facility would leverage in additional money from the international capital markets. It would seek to raise the amount of development aid from just over $50 billion a year today, to $100 billion per year in the years to 2015.

The Facility will ensure not only additional money, but also value for money. It will do this by providing, for the first time, a predictable and stable flow of aid, allowing developing countries to plan long-term investment effectively and efficiently.

It would thus build on existing agreements, between developed and developing countries, with each country:

pursuing anti-corruption, pro-stability policies and agreeing the necessary transparency in economic and corporate policies to achieve this;
committing to the Doha development agenda – a sequenced opening up of markets to global trade;
improving the environment for investment and private sector-led growth; and
as part of country-owned poverty reduction strategies, agreeing clear and costed plans for building education, health and economic capacity.
Chancellor Gordon Brown said:

“The IFF will provide developing countries that reform with the means to invest in schools and healthcare, roads and legal systems, helping to create the environment businesses need as well as create the conditions that will enable countries to participate in, and benefit from, global trade. And as families in those countries are lifted out of poverty, new and dynamic markets will be created.”

Clare Short said:

“The Facility could double the aid currently available, which would provide sufficient investment to enable every country committed to reform to make progress towards the Millennium Development Goals. This would help create a more just and safer world.”