Oct 11, 1986



GENEVA OCT. 9 (IFDA/), BY CHAKRAVARTHI RAGHAVAN. -- The current financial crisis in the UN system could be used as an opportunity to strengthen the United Nations System, but unless third world countries organise themselves effectively to act in a coordinated way, it could lead to a weakening of the UN and its capacity to further third world development.

This was a common view that constantly came up at a private seminar this week on the future of the United Nations.

Organised by the International Foundation for Development alternatives (IFDA) at Nyon (Switzerland), the Seminar had two dozen participants from the Geneva International Community - diplomats, current and former UN officials, representatives of non-governmental organisations, and the Academic Community.

Layachi Yaker, a Vice-Chairman of the UN expert Group of 18 and Senior Politician and Official in Algeria, at the outset gave the Seminar a presentation on the work of the groups of 18 and its broad recommendations.

Prince Sadruddin Aga Khan, who co-chaired with Maurice Strong, an Informal Non-Official Consultation in august in New York on the UN financial crisis, outlined the circumstances leading to the non-official study, by former UN Official George Davidson, on short-term recommendations for meeting the financial crisis and other long-term measures for strengthening the UN System.

Yaker explained at the outset that if the Group of 18 had not addressed some of the important political aspects of the crisis and the basic issues that had led to the so-called financial crisis, it was because of their limited mandate. And while the two superpowers had tried to focus the group's work on reducing the UN activities and putting a ceiling on expenditures, the group itself had reversed the priorities in its work.

It was necessary to see the exercise as the beginning of a medium to long-term process for reforming and strengthening the UN, and the third world must study the implications and adopt a strategy and convince their partners in the system about it.

"We must work with like-minded and Socialist countries to put pressure on those who are against the UN system and its expansion", Yaker added.

Sadruddin stressed the importance of organisational leadership in using the crisis as an opportunity for strengthening the system.

He referred to the detailed estimations and suggestions in the Davidson report for a budget reduction exercise coupled with a revision of the assessment formula (to put a ceiling on the US or other major contributions to eliminate the UN dependency on any single power or powers), and noted that if the revised assessments were to be carried out along with a budget reduction of about 100 million, none of the other contributors would have to increase their actual dollar contribution more than now.

Yaker noted that the issue of revision of assessment scales had been discussed by the Group of 18, but had not been recommended, this was because of the opposition from a very large number of countries who strongly felt that it would be "unjust" to give up the criteria of capacity to pay for assessment and reduce the U.S. contribution or accept the right of any country through domestic laws to renege on its international commitments.

Several participants in the Seminar felt that there was great advantage in putting a ceiling, and thus reducing the dependency on the U.S. or other major contributors, and suggested that the medium and small powers of the industrial and third world, should re-think this question and their opposition.

Much of the discussion at the Seminar centred more around the larger and medium to long-term issues than the merits of any particular recommendation or set of recommendations in the report of the Group of 18.

Some participants said that if the report of the Group of 18 was essentially seen as a holding operation, and suggesting remedies to meet the financial and budget crisis, it would have merit.

but if the budget crisis was to be used to change the focus and objectives of the UN activities in the areas of economic and social affairs, and its focus on development, then it would be serious.

Another noted that any serious effort to strengthen financial viability and improving the performance and practices of the O.N. must stem from a common concept of the role of the organisation, and this was lacking in all the discussions and recommendations so far.

More than one participant noted that some of the studies and the report of the Group of 18 appeared to be influenced by the Bertrand report, which appeared in essence to call form rescinding many of the decisions and bodies created in the 60s and 70s to deal wiial sectors, and instead go back to -UNCTAD, UNEP, UNIDO, the Science and Technology Organisation, etc.- had all been created because of the proven inadequacy and inability of the ECOSOC to deal with any of the problems or its charter obligations.

One participant wondered whether some of these medium to long-term recommendations, for inter-governmental study and action, would not really lead to a strengthening of the non-universal institutions and creating a new colonialism and world order based on transnational corporations.

Another participant said the talk of decentralisation seemed really to be for recentralising activities in other institutions where the third world has less say.

The idea of sloughing off the various UN operational activities as a cost-saving exercise conceptually failed to take account of the interdependence between these activities to strengthen the national processes and the harmonisation of international economic policies which was a charter objective, another participant noted.

Some others said that "efficiency" and "effectiveness" should not be confused, nor could an inter-governmental organisation like the UN be judged from the efficiency or cost-effectiveness viewpoints of the management of a TNC.

Efficiency, one participant said, could well result in doing the wrong things at the least cost, whereas the UN should be concerned with getting best results for the money spent for a desirable objective.

The effectiveness of an organisation like UNCTAD, another participant noted, could note be judged merely from the viewpoint of specific agreements reached, but also from its contribution to creating an international consensus for policy frameworks adopted and executed elsewhere.

The examples of the concept of ODA, the idea of SDRS, the problems of least developed countries, and several others were cited as examples.

Most speakers underlined the importance of maintaining the present UN decision-making process in which the medium and small powers all had a stake. Otherwise, any system of weighted voting or decision by consensus, could become easily a tool in the hands of the super-powers to frustrate the will of the vast majority.

One participant suggested that perhaps an area worth exploring would be high-level participation at an early enough stage in priority setting, and combing in one advisory body to the General Assembly, the priority setting and budgetary questions. Such a body could perhaps approach its recommendations forma a consensus approach.

However, another participant noted that the concept of decision-making by consensus required bona fide approach to negotiations, which was seriously lacking in the present U.S. administration, as had been repeatedly demonstrated.

Several speakers said that while unnecessary duplication should be avoided, this should not become a tool to eliminate pluralistic voiced within the UN System, and different UN bodies bringing different perceptions or viewpoints to bear on a problem, including in the current economic crisis and the debt issues.

While the idea again of avoiding duplication in technical assistance, and strengthening of the role of the Central Funding Agency of the UNDP had merit, another participant wondered whether any of the assistance provided to third world countries in the area of Science and Technology, shipping, port, and a number of other areas would have been possible if all these had been left to the UNDP, where the U.S. and some big contributors effectively blocked anything that did not suit the interests of their TNCS.

Some of the participants said that while much attention was being paid to the issues and problems in the areas of economic and social activities, the primary focus of the O.N, namely collective security, peace-keeping, and settlement of disputes, should not be forgotten in efforts to reform and strengthen the UN system.

Another participant, from an industrial country, said that in the early days of the cold war, the majority in the UN General Assembly had allowed itself to be manipulated by one of the major powers in a conflict.

With the renewal of the cold war, the major powers were again trying to use the UN bodies for their short-term political gains. If the UN was to survive, it was for the General Assembly and its member States to keep themselves out, and not allow themselves to be manipulated into the cold wars of the major powers.

Several NGO participants stressed that the financial and political crisis in the UN was merely a reflection of the political crisis in the world outside, and the efforts of some to turn their back on multilateralism.

Another said that the crisis was not so much an attack on multilateralism, but an effort to reformulate the rules of the game of multilateralism.

Another NGO representative said that in the current so-called financial crisis, the UN and many of the representatives in UN bodies were paying a lot of attention to those NGO's who have been criticising the UN from a particular viewpoint, but paying little or no attention to the very large number of NGO's from the development community who were concerned that the UN system was gradually losing the poverty focus in its work.

It was no coincidence that the UN system organisations facing a crisis - UNCTAD, IFAD, IDA, UNESCO, etc. - were the very organisations that had been raising some fundamental questions about North-South negotiations and poverty issues within and among nations.

Several participants supported the IFDA proposal for an independent commission or study on the strengthening of the UN system, to be commissioned directly by the UN General Assembly, on the lines of the Jackson capacity study.

There was also support for the idea of an annual "citizens' report" on the state of the world organisation, to be undertaken by a non-governmental group or groups, one NGO representative said that something on the lines of the Helsinki monitoring groups should be formed by NGO groups.

But one participant thought that the idea of an independent commission or study on strengthening the UN might not lead to desirable results, and any efforts to reform and strengthen the UN and its system had to involve also the U.S. and others who were critical.

The idea of the UN having a third chamber of non-governmental or representatives of the people, whose voices could be heard, could merely lead to another body of elites, he argued.

One participant said that the failures in the UN system that ignored the IMF/IBRD and GATT would lead to serious consequences and increase the inequities in the international system.

While the Group of 77 elsewhere was divided and ineffective, the Group of 24 (Finance Ministers Group in the IMF/IBRD) had been coopted into the IMF/IBRD system, and taking the North-South dialogue issues into the interim committee and development committee, ignoring the other parts of the UN and the other chapters of the Group of 77 and their views.

This state of affairs could not be remedies without measures to strengthen the functioning of the Group of 77, including through a Secretariat or coordinating body for the group.

One participant said that while the measures needed to meet the immediate financial crisis would have to be implemented, long-term issues needed a visionary approach. Mere measures to reform or strengthen the UN would not suffice without first agreeing on the kind of UN that was needed.

A third world participant said that and the world was now living in a transitional period, while a new order was in formation. Until this emerged, they could continue with such crises.

Instead of the kind of world order envisaged by the third world in 1964 (when UNCTAD was founded) or the NIEO, GATT was now emerging as "the supreme organ" in trade, and was becoming more important then even the IMF and the World Bank. Third world countries were not as cohesive as before, and its effect was seen at Punta del Este GATT meeting.

Participants at the meeting were: Sadruddin Aga Khan, Amb. Saad Alfarargi (Egypt), Gamani Corea (Former UNCTAD Secretary-General), Kenneth Dadzie (Secretary-General of UNCTAD), Amb. Tobgye S. Dorji of Bhutan, Amb. Rolf Ekeus of Sweden, Victor Yves Ghebali (Geneva Institute for Higher Studies), Marek Hagmajer (World Federation of UN Associations), Sven Hamrell (Dag Hammarskjold Foundation), Amb. Amir Jamal of Tanzania, Thierry Lemaresquier (UNDP NGO Liasion Office), Sten Lundbo (Norway), Marc Nerfin (President of IFDA), C. Raghavan (Chief Editor, IFDA/SUNS), Diana Ryssel (Geneva), Amb. Robert Van Schaik of Netherlands, Pierre De Senarclens (University of Lausanne), Amb. Alioune Sene of Senegal, Leelamanda De Silva (Third World Forum), Amb, Jackaran Singh Teja of India, Inga Thorsson (Sweden), Amb. Kazimir Vidas of Yugoslavia, Layachi Yaker (Algeria), and Michael Zammit-Cutajar (UNCTAD).