Impact of Global Trade Tensions on Developing Countries: How to respond to a reset of the global economic system
By Yuefen Li
The recent unilateral, significant and broad-ranging tariff hikes by the new United States administration have triggered unprecedented trade tension in the world and led to significant downward revisions of the world’s economic and trade growth projections for 2025 and beyond.The main aims of the U.S.’ trade policies are complex and strategic, not only about reducing thetrade and fiscal deficits, but also addressing the dollar overvaluation problem, “reconfigur(ing) the global trading and financial systems to America’s benefit”, promoting economic “fairness” and “making America great again”.As what has frequently happened before, the poor countries are disproportionally affected by the negative repercussions of thesepolicies, owing to their financial and capacity constraints and weaknesses to absorb the impact. This short paper analyses through which channels and to what degree trade tension would introduce economic, financial and political stability risks for developing countries, particularly in financially distressed developing countries. A few policy recommendations are also briefly mentioned.
Statement of President Mbeki under the Council Agenda Item 5
8 May 2025
Pres. Thabo Mbeki, Chair of the South Centre Board, thanked the Centre for continuing to work for the adoption of frameworks, rules & policies that promote the common interest of the Global South. He also called on Member States to address structural asymmetries & support efforts to achieve SDGs, as well as to ensure the Centre’s sustainability. In commemoration of the South Centre’s 30th anniversary this year, he also expressed that the Centre is proud to have preserved the values and have worked hard to make a reality the visions and aspirations of the founders of the Centre, led by Mwalimu Julius Nyerere, one of the great leaders of the Global South.
Mali’s Mining Shake-Up: Tax audits reveal massive revenue loss and lead to stringent policy changes
By Anne Wanyagathi Maina and Kolawole Omole
Mali’s recent regulatory changes and tax dispute settlements highlight the government’s determination to secure a greater share of economic benefits from its natural resources. Mali’s approach presents a lesson for resource-rich developing countries. The article explores the country’s mining tax reforms, ensuing tax disputes and settlements, and implications on revenue mobilization.
COMBATTING ILLICIT FINANCIAL FLOWS (IFFS) AND ENHANCING DOMESTIC RESOURCE MOBILISATION (DRM) FOR FINANCING DEVELOPMENT: A DECADE UNDER REVIEW
Hosted by the South African G20 Development Working Group and the South Centre, funded by the International Economic Partnership Programme
Date: 30 April 2025
Time: 13:15 to 14:30
Venue: Room CR-D United Nations Headquarters, New York
The side event focuses on the importance of reducing illicit financial flows (IFFs) and enhancing domestic resource mobilisation (DRM) to support the financing for development initiatives.
STATEMENT BY DR. CARLOS CORREA, EXECUTIVE DIRECTOR OF THE SOUTH CENTRE, TO THE MINISTERS AND GOVERNORS MEETING OF THE INTERGOVERNMENTAL GROUP OF TWENTY-FOUR (G24)
22 April 2025, Washington, D.C.
The South Centre statement to the G24 Ministerial Meeting highlights the risks of a darkening global economic outlook and need for collective action at UN and FfD4 for addressing systemic issues & reforming the international financial architecture, especially for taxation & sovereign debt.
Towards a UN Protocol for Taxing Cross-Border Services in a Digitalized Economy
By Abdul Muheet Chowdhary, Anne Wanyagathi Maina and Kolawole Omole
This Policy Brief offers a way forward on the United Nations Framework Convention on International Tax Cooperation’s (UNFCITC) protocol for taxing cross-border services in a digitalized economy. Such a protocol can provide a way to standardize and harmonize the existing plethora of widely varying Digital Services Taxes (DSTs), which can reduce political tension between the Global North and South, ease compliance costs and uncertainties for business, while providing a basis for the elimination of double taxation. The revenue generated can help bridge the Sustainable Development Goals (SDGs) financing gap and for the realization of human rights in the Global South. The Group of Twenty (G20) can act as a forum where key countries in the North and South can hammer out the architecture of the protocol for taxing cross-border services.
What Is Driving the BRICS’ Debate on De-Dollarisation?
By Ding Yifan
Ahead of the 2023 BRICS summit in Johannesburg, South Africa, there was much discussion amongst the member countries about whether negotiations would take place at the meeting regarding the development of a BRICS currency and the acceleration of de-dollarisation, that is, the promotion of currency cooperation and reduction in the use of the US dollar. In the end, the country leaders did not specifically discuss the issue of a BRICS currency but passed a resolution on expanding the organisation’s membership. Nonetheless, from both historical and realist perspectives, it is in the interest of the BRICS countries to promote de-dollarisation.
General Statement at the 2nd Preparatory Committee for the 4th International Conference on Financing for Development
New York, 3-6 December 2024
At the 2nd Preparatory Committee for the 4th International Conference on Financing for Development, South Centre emphasised the important opportunity FfD4 presents for developing countries to address significant shortfalls in resource mobilization necessary to implement SDGs & to reform the international financial architecture to align with Southern priorities.
South Centre Inputs to FfD4 Elements Paper – Debt Sustainability, Business and Finance, Taxation
By Yuefen Li, Danish, Abdul Muheet Chowdhary
The upcoming 4th conference on financing for development (FfD4) represents an important opportunity for developing countries to achieve a deep reform of the international financial architecture so that it meets their sustainable development needs and enhances the scale of development finance to fully realize the 2030 Agenda for Sustainable Development. Based on the inputs provided by the South Centre to the FfD4 process, this policy brief highlights some of the key messages, problem statements and policy solutions in the areas of sovereign debt, private business and finance, and international tax cooperation that should be considered by the countries of the global South in their deliberations towards achieving ambitious outcomes at FfD4.
Undue High Expectations of the G20 Common Framework: Urgent Need to Reform the International Debt Architecture
By Yuefen Li
This article stresses how international debt architecture reform requires innovative solutions beyond the G20 Common Framework, and should be addressed at the 4th International Conference on Financing for Development.
Determining the Upper Bound of the Scoping Criteria for Amount B in the OECD/G20 Two-Pillar Solution: A Policy Guide for Developing Jurisdictions
By Chetan Rao, Ruchika Sharma, and Dr. Vijit Patel
Amount B, a component of the OECD/G20 Two-Pillar Solution, has been designed to simplify transfer pricing for baseline distribution activities. With the aim of developing a practical policy guide for developing jurisdictions to fine tune the quantitative scoping criterion under Amount B, i.e., “annual operating expense to annual net revenue” ratio, this paper critically analyses various aspects of this criterion. The upper bound of this ratio is purported to help jurisdictions in identifying baseline distributors. It is currently set as a flexible range from 20% to 30%, with the choice available to each adopting jurisdiction deciding the exact point in the range for implementation of Amount B within its jurisdiction. Given the lack of any data-backed rationale in the Amount B report for development of this range, the authors suggest that the upper bound range might have been politically negotiated. For this very reason, developing countries need to tread carefully while setting the upper-bound and consider both its tax as well as policy implications. Through an empirical analysis of independent distributors in India, the paper highlights the link between the upper bound, functionality, and profitability, illustrating how these metrics impact developing countries with lower asset and expense intensities. The findings suggest that setting the upper bound at the higher end of the range could unintentionally bring above-baseline distributors into scope, thus foregoing long-term taxing rights for developing jurisdictions. Through this analysis, the paper offers practical insights and recommendations for jurisdictions, especially developing ones, for setting this upper bound to protect their taxing rights and minimize risks of misclassification of above-baseline distributors as baseline.
Statement by the South Centre at the 2024 Social Forum of the Human Rights Council
31 October 2024
At the Human Rights Council Social Forum, South Centre Senior Programme Officer Abdul Muheet Chowdhary presented key international tax reform inputs to the upcoming Fourth International Conference on Financing for Development (FfD4) for “The Contribution Of Financing For Development To The Advancement Of All Human Rights For All”.
