ECOFIN: Mitigating the Macroeconomic Risks of AI Labour Displacement

Committee: United Nations General Assembly Second Committee — Economic and Financial Committee (ECOFIN)
Agenda: Mitigating the Macroeconomic Risks of AI Labour Displacement: Establishing Global Financial Frameworks for Equitable Workforce Transition
Sponsors: Malaysia, Ethiopia, India, Egypt, Singapore, Peru, Nepal, Australia, Vietnam, Nigeria, Mozambique, Argentina, Thailand, Tanzania, Indonesia, Brazil, Uganda, Malawi, Pakistan, South Africa, Türkiye, Kenya, Colombia, Sri Lanka, Ghana, Japan, Bangladesh, Republic of Korea, Chile, Mexico, Rwanda, Morocco, Philippines, Zambia
Signatories: Sweden, Germany

What the resolution does

The resolution establishes the Global AI Workforce Transition Fund, under the joint coordination of relevant international financial institutions, to provide concessional financing for workforce reskilling, social protection programmes and labour market adjustment in developing countries. It further recommends that the International Monetary Fund establish a dedicated financing window for the Fund under its Resilience and Sustainability Trust, providing an additional avenue through which developing countries may draw concessional and long-term financing without exacerbating existing debt burdens.

Beyond that window, the Fund is to be capitalised through four diversified sources: a digital productivity levy imposed on AI-intensive multinational corporations whose annual revenues exceed an internationally agreed threshold; profit-sharing contributions from joint public-private and cross-country partnerships, under which participating businesses commit an agreed percentage of profits generated from AI deployment in developing countries; in-kind and financial technology-transfer contributions from developed country members in fulfilment of their obligations under Article 66.2 of the TRIPS Agreement; and voluntary contributions from member states, regional development banks, and philanthropic and multilateral partners.

The Fund is to be governed by a Governing Board comprising representatives of UNCTAD, the World Bank, the International Labour Organization, regional development banks including the African Development Bank, and rotating representatives of contributing and beneficiary member states, with a Secretariat hosted at UNCTAD. It is to be replenished annually, with levels reviewed at an Annual Conference of the Fund, taking into account verified workforce displacement data and prior-year utilisation rates.

Eligibility criteria are to be set and periodically reviewed by the Governing Board, requiring beneficiary states to submit verified labour displacement data and a national AI workforce transition plan, with priority given to least-developed countries and net oil-importing developing countries facing concurrent fiscal distress. Disbursements are to be released in phased tranches contingent on independently verified milestones, audited jointly by the African Development Bank and relevant national oversight bodies, with public disclosure of fund allocation modelled on Nigeria's Extractive Industries Transparency Initiative, and future tranches suspended in cases of verified misappropriation.

Alongside the Fund, the resolution encourages the establishment of regional AI technology hubs and secure data centre infrastructure, particularly across the G77, through public-private partnerships and multilateral financing. It calls for increased investment in technical, vocational, entrepreneurship and digital education integrated with AI literacy and workforce transition programmes. It urges member states to establish Wage Protection and Unemployment Insurance Funds providing temporary income support for workers displaced by automation while they undergo approved reskilling. It recommends tax incentives and low-interest financing for small and medium-sized enterprises adopting AI while implementing workforce transition plans. And it recommends a standing ILO Tripartite Working Group on Artificial Intelligence and Employment, bringing together governments, employers and workers to monitor labour market displacement in real time.

What the preamble records

The preamble cites UNCTAD estimates that the AI market could reach 4.8 trillion dollars, potentially disrupting up to 40 per cent of jobs worldwide, and UNCTAD's Technology and Innovation Report (2025) finding that over 90 per cent of specialised AI computing resources are concentrated in two countries, leaving more than 150 nations without significant domestic AI infrastructure.

It records the disproportionate exposure of youth, women and workers in outsourcing-dependent economies to AI-driven job losses, as documented by the International Labour Organization and the UN Envoy on Technology. It bears in mind the need for African and other developing member states to build indigenous digital infrastructure and human capital in order to participate as producers, and not only consumers, of artificial intelligence. And it notes that financing mechanisms reliant solely on government contributions are vulnerable to fiscal constraints.

In the room

Four blocs formed initially — Asian, African, American and European. During negotiations the Asian, African and American blocs merged into a single coalition, which delegates referred to as the A3; the European bloc continued to operate independently. That division is legible in the resolution's own sponsorship: the sponsors number more than thirty states, overwhelmingly from the Global South, while Sweden and Germany appear as its only signatories.

Delegates of Nigeria and Kenya drove the negotiations. The delegate of Kenya told the committee that around forty per cent of the population of the country he represents is affected by AI-driven labour displacement. The delegate of South Africa, speaking on the floor, said: "The UN wasn't created to lead us to heaven, but to save us from hell."

The atmosphere remained collegial throughout.