DEVELOPMENT WAS AT A CRUNCH POINT WEDNESDAY

9:55 PM May 8, 1996

DEVELOPMENT WAS AT A CRUNCH POINT WEDNESDAY
After the morning meetings of some of the regional groups, delegations from Asia and Africa reported a deadlock on the trade issues and UNCTAD role in analysing and discussing new trade agenda, on the question of debt and resource flows, and on related institutional issues about the inter-governmental bodies at UNCTAD - the Trade and Development Board and Commissions under it, the experts groups under the Commissions and the mandates of all these bodies.

The United States was adopting a very hard line, in effect telling delegations that only an attenuated UNCTAD, willing to play a second fiddle role to the WTO and the Brettton Woods Institutions would be tolerated and acceptable.

According to some delegations and NGOs, the leader of the US delegation reportedly told a key group of delegation leaders: "An UNCTAD on US terms or no UNCTAD at all."

Other delegations said that Japan and the EU have been more forthcoming and open on the future UNCTAD role in the trade and development area and the new trade issues, and that the US is pretty isolated on these.However, Japan is with the US in a hard line stance to end any UNCTAD role on debt issues.At a meeting of the G-7 countries here with the President of theConference, Trade and Industry Minister Alec Erwin, other G-7 delegates reportedly made clear that the US view was only that of the US and did not represent the views of others.

Some of the developing country delegations think it was time to call the US bluff and show the US Emperor is without clothes.But this is perhaps easier said than done, more so when the Group of 77 is no longer united.

According to conference sources, the various drafting groups will bring up to the Committee of the Whole the intractable issues, and a contact group at the level of the COW chair, Mr. William Rossier of Switzerland, to negotiate the hard issues.

Erwin himself is away in Cape Town Wednesday, for the meeting of the South African Constituent Assembly where the new Constitution is to be voted upon and adopted by two-thirds majority.

The Presidency of the Conference is reported to be preparing a Declaration and a first draft is expected to be in the hands of delegations today for their comments and views. While traditionally it is not 'negotiated', delegations provide their comments and inputs and the Presidency is expected to reflect them.

Meanwhile, some of the major industrialized countries are becoming aware that if the US succeeds in reducing the UNCTAD role to undertaking studies and analysis and providing technical assistance to the LDCs, the other developing countries will lose interest but that this need not necessarily bring strength to the WTO.If the problems, difficulties and even grouses of countries can no longer be aired at UNCTAD, these will 'invade' the WTO, and the WTO will become fully politicised and the major industrial nations will be worse off.

The G-7 are not either united or powerful to assert their dominance in the world economy when inexorably the centre of gravity is shifting and the major developing countries and their weight is increasing, and these are no longer ready to tolerate the dictation of terms by the US.