UNCDF Gets Green Light from Executive Board for Enhanced Vision in Serving Least Developed Countries
NEW YORK, February 10, 2005 - The United Nations Capital Development Fund recently met with its Executive Board - the public sector equivalent of a board of directors, with representatives from UN member governments - to refine and define its work in supporting Least Developed Countries (LDCs) achieve the Millennium Development Goals (MDGs). At its biannual meeting in January 2005, the Board endorsed the mandate and functions of UNCDF after an extensive year-long evaluation, which included a review of its operations and impact on the ground.
The LDC and donor members of the Executive Board voiced a strong interest to see UNCDF revived and financially strengthened to fulfill its mandate to support LDCs to achieve the MDGs by delivering investments and technical support, in its two focus areas: decentralization/local development and building inclusive financial sectors/microfinance.
In his opening statement to the Executive Board, UNDP Associate Administrator Zéphirin Diabré, put UNCDF squarely within the context of the MDGs. He referred to a recent report by Jeffery Sachs in which the Columbia University professor recommended that MDG-based poverty reduction strategies support the scaling up of public investments, capacity building, domestic resource mobilization and official development assistance, and that the MDG based poverty reduction strategies should focus on, amongst others, the promotion of mechanisms for transparent and decentralized governance.
"This, I believe, is where UNCDF steps in," said Diabré. "The delegates of the LDCs have been unequivocal in voicing their support and need for UNCDF, and for good reasons. Over the past years, with the guidance of this Board, UNCDF has come to be an effective, efficient and highly relevant organization for the LDCs, focused in its two niche areas of work - decentralized public investments and microfinance. UNCDF has a very clear-cut agenda, fully supportive of the national poverty reduction plans of the LDCs and consistent with the Secretary-General's Practical Plan to achieve the MDGs.
"Simply put - if given the opportunity and the resources, UNCDF will help LDCs establish on a national scale, decentralized public service delivery systems, such that the local governments of the LDCs will operate in a transparent and participatory manner to deliver, effectively and efficiently, those services that the local populations need most."
UNCDF intends to follow up with this decision by reviewing the budgetary, legal and functional aspects, and to restructure its operations accordingly. Resource mobilization will be a key priority.
Following is the full text of the Executive Board's decision taken at this meeting. (EB Decision 2005/05)
Item 5. United Nations Capital Development Fund
2005/5
Options for a future business model for the United Nations Capital Development Fund (DP/2005/8)
The Executive Board
- Takes note with appreciation of the report on options for a future business model for the United Nations Capital Development Fund (UNCDF) (DP/2005/08), presented in line with Executive Board decision 2004/37;
- Recalls that UNCDF is mandated by the United Nations General Assembly to provide capital assistance, first and foremost to the least developed countries;
- Notes that UNCDF has efficiently and effectively addressed the specific needs of least-developed countries through its local governance and microfinance programmes, thereby playing a clear role in achieving the Millennium Development Goals (MDGs)* at the local level;
- Notes that UNCDF has harmonized and integrated its operations with those of the United National Development Programme (UNDP) in terms of, among other things, country programming, joint programmes, country, regional and headquarters presence, common shared support services and principles of cost recovery policies, thereby significantly reducing the administrative and procedural burden on the organization and its national partners;
- Decides to maintain UNCDF as an independent organization focused on reducing poverty and achieving the MDGs* in the least developed countries.
- Requests the Administrator, on the basis of option 3, sub-option 4 of document DP/2005/08 to provide a detailed implementation plan for this option, including budgetary, legal and programming arrangements, for decision at the 2005 annual session of the Executive Board;
- Notes that the above option would further enhance the efficiency and effectiveness of UNCDF;
- Requests the Administrator to appoint, as soon as possible, a new Executive Secretary for UNCDF;
- Stresses that regular resources, because of their untied nature, will continue to be the foundation of UNCDF programme activities and that the effectiveness of UNCDF hinges on its access to predictable and sustained multi-year funding to finance its programmes in local development and microfinance;
- Calls upon UNDP to assist UNCDF in mobilizing the resources necessary to sustain its current local governance and microfinance activities; and
- Calls upon donor countries and other countries in a position to do so to provide and sustain additional funding support to UNCDF programmes and activities in the least developed countries;
28 January 2005
* Internationally agreed development goals, including those contained in the Millennium Declaration.
