Speech
European Development Days Stockholm 24 October 2009
Carl Bildt, Minister for Foreign Affairs

Closing speech by Carl Bildt at The Euorpean Development Days

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Excellences
Nobel laureates
Ladies and Gentlemen

For two days Stockholm has been the centre for intense discussions and exchange of ideas about some of the most demanding challenges of our time. Be it the economic downturn, be it climate change, be it democracy building that is on top of our common agenda, none of these challenges can be met unless we act together. And no common action will be possible if we don't seek involvement by all those concerned and willing who not only believes in a better future but are prepared to act accordingly as well.

All of you participants, who have chosen to travel the long way to Sweden and take part in the European Development Days, should therefore know how much we appreciate your contribution to the global dialogue on these issues.

A meeting such as this will of course be devoted to the many problems facing our generation. We have been gathering in Stockholm because we are worried about some aspects of the global development and because we are willing to make the necessary adjustments in order to achieve a greater sustainability to the benefit for all of us in our day, but even more to the benefit for the generations to come.

The main focus during these days have been on economy and environment. We have to act simultaneously on warming up a deep-frozen economy and cooling down an overheated mother earth. And besides this immediate challenge we should add the never-ending task of building societies where freedom and democracy prevail.

On these undertakings sense of urgency is a definite asset and crisis awareness a necessary precondition if you want to get things done. But having said that and since we now have come to the closing session and no end is as good as a happy end, I would like to highlight at least some of the brighter elements in the overall picture.

Take for instance the global economy, which in the three decades foregoing the financial meltdown had grown by 145 percent. This means a yearly growth rate on average 3,4 per cent while the global population grew by on average 1,6 per cent per year. Let's assume that the global GDP shrunk by 10 per cent 2008 - 2010 and the yearly growth would still be 2,7 per cent. And this would be an extremely negative scenario for the crisis. The actual and much more realistic figures are according to IMF plus 3 per cent 2008, minus 1,1 percent 2009 and plus 3,1 2010.

We shall definitely not underestimate the effects of the economic downturn on these who live on the existential edge or on countries with strong imbalances. But let us not forget that there is still a substantial growth in global GDP per capita. And let us also not forget that while the advanced economies will see a negative growth - minus 3,4 percent 2009 - emerging and developing economies will still be growing by 1,7 percent this year and 5,1 per cent next year. The last figure should be compared with the growth next year in the advanced economies by 1,3 per cent. So if IMF is right in its forecasts we should see a markedly better development in the emerging and developing economies than in the advanced ones.

There are of course great variations. Russia and Mexico faces a steep fall this year by more than 7 percent while China and India will see a comfortable growth by 8,5 and 5,5 per cent respectively. But the overall picture in IMF:s latest report is that the worst is over. We will se positive growth again next year in almost all countries. The world trade which will shrink with almost 12 percent this year will start to expand in 2010. And the positive trend from the early eighties that the emerging and developing countries are catching up seems to continue.

From a development perspective it could have been much worse. And the decisive and coordinated actions taken by the central banks lowering interest rates and the fiscal stimulus packages provided by the governments to restore confidence in the markets have so far been effective. It is the first global crisis in the true sense and the first crisis which have been fought on a global scale. Up till now the international community of the 21 st century has stood the test. And - amidst all the difficulties - this is good news.

Still the crisis is not over yet and the need for global, coordinated action will be there for a number of years. The ultimate melt down of the global financial systems was prevented. Now the primary task is to support recovery.

To be successful in this it is not enough to avoid old mistakes you need also to repeat successful behavior from the past. And as the World Bank Development Report from 2009 clearly states, the best way to promote development is further integration.

The positive effects of economic integration during the last decades are indeed stunning. I mentioned earlier the strong and persistent growth since the early eighties. And as a consequence of the integration we usually call globalization, we now have 40% of the world population that were previously excluded, entering the global system of production and consumption.

It's not happening overnight. But if we assume that only 10% of them have by now been able to fully enter the global workforce, it's still a number that is approximately equal to the entire workforce of the United States.

Any day now, half of global production will be coming from emerging economies. And soon we will be seeing companies from emerging markets starting to appear among the Fortune 500 - previously reserved for Americans, Europeans and Japanese.

Within a decade it is a reasonable assumption that approximately 80% of the global middle class will live in the countries we previously called developing. It's the new global middle class from Shanghai to Sao Paulo that will drive the new consumption patterns.

From a developmental point of view this is nothing but a revolution! But a peaceful revolution coming from peoples natural an perfectly legitimate desire to live under decent living conditions.

But if we don't act wisely this development will come to a halt simply because it is not sustainable. Around the world and particularly in the poorest and most vulnerable countries, global warming already threatens to undermine development efforts in health, agriculture and infrastructure. Migration caused by lack of access to water and land is increasing social tensions and undermining political stability.

But the solution can never be to stop economic development and denying people in developing countries the possibility to increase their standard of living. We must seek other solutions instead. Solutions combining strong action to prevent climate change with economic opportunities for all.

The European Union here has a big responsibility.
Under the Swedish Presidency the Union has urged for coordinated policy measures in response to the crisis, including in regard to the poorest countries. We have actively contributed to decision aiming to support at least 100 billion dollars in additional lending from the World Bank and other Multilateral Developing Banks for rapid investment in infrastructure and social programs and we have reaffirmed the commitments to support developing countries in meeting the Millennium Developing Goals.

We stand firmly behind the Unions intention to channel at least 50 percent of the collective aid increase to Africa.
In the field of climate change, we will do the outmost to bring about a successful deal in Copenhagen. The Union is strongly dedicated to help unlock the negotiations through its commitments to take ambitious mitigation action at home, and on financial and technological support to help developing countries to move to a low carbon growth path. We believe that we all can come to an agreement in Copenhagen which both promotes economic advance in the developing world and effective measures against global warming.

But let us not forget that no agreement whatsoever will be effective unless we get each and everyone to act. We must reach out to the consumers, to the producers, to local and regional politicians, to bureaucracies as well as to civil society.

Democracy building becomes in this respect an important tool also in meeting these so demanding challenges. We must all rely on the ordinary man and woman on the street, on their willingness to take personal responsibility for our future living conditions and on them being prepared to make short term changes in their life style fore the sake of a safer and better future.

But if you demand responsible action from your citizens in their everyday life you must also give them a say in the big business of the big world.

In a few days we will celebrate the fall of the Berlin Wall and the following process of democratization of Eastern and Central Europe. It is the 20th anniversary of the liberation and reunification of Europe., instead of. Where there used to be concrete walls and iron curtains dividing countries, there are now highways, railroads, airlines and cell phones connecting people.

These remarkable months in 1989 and 1990 teach us that everything is possible and it gives us a good recipe for common action. It is not that difficult after all. Shaping the future is basically nothing more complicated than making something possible out of the impossible.

In this most honorable and important mission we should wish ourselves the best of luck. We have done it before, and we can do it again. Good bye and have a safe trip home.