9:10 AM Jul 15, 1993


Geneva 14 July (Chakravarthi Raghavan) -- The Tokyo market access accords announced with great fanfare, while in the right direction, only tackled the trade issues of interest to the developed countries and not of the developing countries and hence did not provide a basis for concluding the Uruguay Round by year-end, the Group of 77 and China declared Wednesday.

In a statement on behalf of the G77 and China in the Economic Committee of ECOSOC during its discussion of development and international economic cooperation issues, Amb. Luis Fernando Jaramillo of Colombia, Chairman of the G77, welcomed the current moves in the OECD countries to strengthen their economic growth rates and reduce problems of unemployment and said:

"We have always supported them. However, we wish to give notice that cannot be achieved by creating the opposite effect in the rest of the world at an unimaginable cost. Growth and employment are priority concerns in all countries."

Earlier, Jaramillo noted that the vocabulary and doctrines proclaimed by the developed world have had "a turnabout" since last year's meeting of the ECOSOC. From condemning and dismissing the proposals of the Group of 77 formulated in the 1960s and 1970s, the developed countries had come to what was unimaginable then: "welcome them as a magical recipe for the development of centrally planned economies (and),,, are now used to justify policies aimed at relieving high unemployment rates and reactivating the economies of industrialized countries."

While the countries of Asia, Africa and Latin America and the Middle East had shown dynamism and high growth in imports, in North America and Western Europe imports remained practically without variation. It was the solidity of imports from a large number of developing countries that sustained the trade activity and was preventing a deeper recession in the developed world.

Notwithstanding this, the exports of developing countries had not performed equally positive and they continued to suffer from "immense discrimination" in access to the markets of industrialized countries. Also, basic commodities which were the principal source of revenue for their countries, continued to be adversely affect by the chronic situation of deterioration of terms of exchange.

Jaramillo added: "the pursuit of policies by developing countries of free trade and strengthening of market economies which have resulted in important increments in their imports and have injected dynamism into world economic activity, are unsustainable in light of the lack of reciprocity that their exports face. In this context, in the absence of structural adjustment by the industrialized countries themselves, the reform process underway throughout the developing world runs the risk of ending in failure. And the political consequences of that could well spell the end to many democracies which are currently in the process of being consolidated."

Referring to the Uruguay Round, the spokesman for the G77 and China said that seven years later, almost three years after the agreed deadline to complete the negotiations, "we are still awaiting the results that would give effect to the commitments of Punta del Este."

The participation of developing countries in the Uruguay Round had been unprecedented in the GATT and the level of liberalization and reform of trade policies, autonomously undertaken by them, were "not on a par with the contrary actions and confused messages coming from the industrialized world."

"While our economies undertake vast and costly structural adjustment programmes and maintain ambitious trade liberalization plans, what we get everyday from the OECD countries are signals of managed trade and calls for protectionism. While our exports of basic commodities, mainly agricultural, receive neither international prices nor conditions of access that would guarantee the sustainability of production, the agricultural commodities of the big countries compete thanks to the financial capability of states and their export and production subsidies, and not to the natural comparative advantages which is the basis of free trade."

Referring in this context to the Tokyo summit, Jaramillo since 1990, every year the big seven at their summits have had "the habit of making grandiloquent declarations based on the overused expression 'political will', to conclude the GATT negotiations, in the midst of a vacuum of coordination of macroeconomic policies and an unusual disorder and assonance in exchange markets."

Against this background and with great fanfare, at Tokyo last week an agreement on market access among the big international trade actors was adopted. But, if it was examined closely, "we find a little more of the same: what was agreed does not respond to the great world trade priorities clearly identified since Punta del Este".

"In this way," Jaramillo said, "the big partners of the Uruguay Round bring us back again to Geneva without resolving the difficult subjects of negotiation which by coincidence are the ones that are of interest to the Group of 77 and China: discipline in the agricultural sector; a package of access for basic commodities, with special emphasis on tropical products; the liberalization of trade in textiles and apparel; strengthening of the rules of exchange and loyal competition, and the mobility of labour."

"There is no agreement on any of the above, which is aggravated by the illusion created that some progress had indeed been achieved," the G77 chairman declared..

While the Tokyo accords seemed to be "oriented in the right direction of opening up markets..in content, coverage, and characteristics they are designed to resolve the trade issues of the developed partners... those agreements do not take into account the interests of developing countries."

"In these circumstances, how could anyone believe in the possibility of concluding the negotiations by year's end?" Jaramillo said.

While the countries of the Group of 77 and China were committed to a prompt solution to the Uruguay Round under the terms agreed upon when it was launched at Punta del Este, "the accountancy between what was agreed then and what is being offered to us now as a solution is disappointing" and it would not be in the interest of the world to conclude the Uruguay Round except in a balanced form that would meet the aspirations of these countries.

Jaramillo said that the "institutional ordering of international trade" was another subject that should continue to be of concern to the intergovernmental forums of the United Nations.

"The developing world," he said, "needs a stable order that guarantees the definitive implementation of the GATT accords and that is at the same time a reflection of an open, predictable, democratic and equitable system. The proposals for the institutional strengthening of GATT and its functioning would not only have to include a greater and closer collaboration with the other Bretton Woods entities, but would have to result in a consolidation of the exiting link between that multilateral body and the United Nations system."

On the International Trade Centre (ITC), jointly run by UNCTAD and the GATT, and which has remained without a head for two years in a dispute between Boutros-Ghali and the developing countries and many of the developed, Jaramillo said it was equally important that the Secretary-General "carry out immediately the resolution of the General Assembly that establishes the level and characteristics of the direction of the ITC".

The Assembly, in approving the secretariat reorganization proposals of Boutros Boutros-Ghali had earlier this year asked him to have the post filled up quickly and maintain it at the level of an Assistant Secretary-General, and not at the level of a Director as he had proposed.

Though it is now several months since the decision was taken, Third World sources in the GATT said that Boutros-Ghali had not so far shown any hurry to comply with the resolution, and that GATT had been receiving "feelers" that as originally proposed by him the ITC's top job should be filled temporarily with an officer-in-charge at the level of a Director. A large number of contracting parties including most of the developing countries have rejected this and have said they would have it taken up again at the General Assembly.

Apart from the G77 and China, Norway, speaking for the Nordic countries at the ECOSOC, has also called for action by Boutros-Ghali in consonance with the unanimous voice of the General Assembly.