UNCTAD EXPERT MEETINGS ON INVESTMENT, COMPETITION

10:04 AM Feb 10, 1997

UNCTAD EXPERT MEETINGS ON INVESTMENT, COMPETITION
Geneva 8 Feb (Chakravarthi Raghavan) -- Agreement has been reached at the new UNCTAD Commission on Investment, Technology and Related Financial issues to convene three expert meetings this year on investment and competition policy issues.

After prolonged negotiations, the Commission met Friday to adopt these agreed conclusions.

One expert meeting will be on competition law and policy.

Of the two expert meetings on investment, one will examine and review existing agreements on investment, taking into account the interests of developing countries, and bearing in mind the work undertaken by other organizations, and to identify and analyze implications for development of issues relevant to a possible multilateral framework on investment.

This meeting is expected for September.

The other meeting on investment will be on investment promotion and suggested measures that promote development objectives.

Last November, the Commission, at its first meeting, found itself unable to agree on the expert group meetings and the work programme, in accordance with the Midrand mandate.

Part of the problem arose out of the uncertainty (at that time in November 22 last) over the fate of "new issues" at the Singapore Ministerial Conference -- with some of those promoting the investment issue at the WTO, blocking UNCTAD going ahead.

The Singapore Ministerial Declaration of the WTO, providing for a study of these questions at the WTO, and expressly taking note of and encouraging the UNCTAD work in these areas, resolved this issue.

But part of the problem, holding up an UNCTAD decision, was due to differences between the Group of 77 and the OECD countries, over the interpretation of the Midrand mandate (for each Commission to have no more than three expert meetings a year) and its effect on UNCTAD Intergovernmental Expert (IGE) bodies created as a result of a UN General Assembly decision, like the IGE on Competition Law and Policy (formerly the IGE on Restrictive Business Practices), or by ECOSOC decision, like the IGE on International Standards of Accounting and Reporting (ISAR).

The Group of 77 had taken the position that while the 'restructuring' agreed at Midrand would cover all the bodies created or set up by UNCTAD, those set up as a result of the UN decisions was a different matter - a view that the US, supported by the other industrial nations strenuously opposed.

The decisions on Friday at the Commission has left the issue of the IGE on Competition Law and Policy and the ISAR to be taken up at the level of the Trade and Development Board.

The Chairman of the Commission, Amb. Lilia Bautista of the Philippines, advised the meeting that she would be asking the President of the TDB, Amb. Patrick Sinyinza of Zambia, to undertake consultations to resolve the deadlock.

The mandate of the expert group on investment agreements, is spelt out in terms of the paragraph 89 (b) of the Midrand mandate at UNCTAD-IX.

During the consultations leading to the agreed conclusion, Bangladesh wanted special mention in the mandate of the expert group to the least developed countries (LDCs) -- who now get very little FDI.

Russia wanted similar special attention paid to the problems of economies in transition.

While the developing countries generally seemed agreeable to accommodate the LDCs, they were unwilling to take on the problems of the economies in transition.

As a result no changes were made. Bangladesh made a statement that it saw no legal bar to a reference to the LDCs in an appropriate way, and that an indepth study by UNCTAD would be of benefit.

Some of the developing country delegations later explained that the study of a multilateral framework and its implications in effect was directly related to the countries getting investment and the implications of a multilateral framework (including such questions as right of establishment etc being demanded in the WTO).

The problem of investment going to LDCs (and for that matter the transition economies) was somewhat different and, in any event, could be addressed in the expert meeting on investment promotion, they said.

In her concluding remarks, Amb. Bautista (referring to the Bangladesh statement on behalf of LDCs) said that the work of the expert groups would take into account the interests and needs of developing countries, in particular the LDCs, and the economies-in-transition.