The Economic and Financial Committee is the second committee of the United Nations. Dealing primarily with global macroeconomic issues, ECOFIN looks to solve problems with economic policy. Alongside traditional objectives such as developing fair international trade and supporting the economies of LICs and NECs, it deals with many of the world’s modern problems including sustainable urban development and the role of internet communication technologies.
With such new and complex problems at hand, delegates of this committee should be able to wield problem solving skills alongside sound economic policy. Resolutions submitted should not include clauses that achieve the same effects as pre-existing UN resolutions. Delegates are also asked to consider the practicality, bureaucracy and resistance in the enforcement of their resolutions.
Topic 1 – The Question of Monitoring, Regulating and Protecting International Financial Transfer Systems: how should the UN respond?
Financial transfer systems are used by banks to send instructions for monetary transfers. For example, a bank may send a request to an account holder to move money from their account to the account of another bank. SWIFT is currently the only major international financial transfer messaging system. In recent years it has suffered several cyber-attacks such as the 2016 attack on the Bank of Bangladesh, in which attackers stole $101 million. These attacks have mostly occurred in countries with a low Corruption Perception Index score (CPI).
A solution could be to regulate the access of these countries to the SWIFT system, as has been done to Iran. However, this can have dire consequences for a country’s economy. It also leads to the question of who should be allowed to regulate such a system (SWIFT is a private organisation regulated by the US government). Some inter-bank payment systems such as Russia’s SPFS have been created in response to the threat of being banned from SWIFT. However, these have seen little use outside of a national scope, demonstrating the difficulties in creating a trustworthy system. Delegates should aim to find a solution, through regulation or otherwise, that mitigates the political and economic threats that current systems face.
A more detailed briefing pack on this topic can be found here.
Topic 2 – The Question of the Regulation of Bilateral Aid and Trade Agreements
Bilateral aid is a form of assistance agreement between two separate countries, often between economically developed and developing nations. This type of aid is mostly condition-based, disguising the genuine motive behind such actions. Although this may stimulate policy reforms in recipient countries and distribute aid effectively, donor countries potentially set the conditions for their interests and undermine the recipients’ internal governmental system and their people’s will. Being a type of bilateral aid, military aid requires the recipient to buy arms and sign defence contracts with the donor. The US has given more than $5 billion in military aid annually since 2009.
The original aim of aid is to relieve suffering caused by natural or artificial disasters, to promote economic development, to ensure the stability of the society and institution and ultimately to ensure the best interest of the recipient countries. Ensuring equality and transparency in the relationship between the donor and the recipient is significant. Should there be a regulatory system for bilateral aid & trade deals or not? What conditionality and selectivity is it reasonable to impose upon the recipients? What regulations should be in place? Delegates should delineate blueprints for future relationships between countries in aid agreements and should explore the possibilities & potential mechanisms of a regulatory system in foreign aid.
A more detailed briefing pack on this topic may be found here.