CALL FOR DIALOGUE ON CONCRETE MEASURES TO SOLVE CRISIS.

Apr 28, 1987

CALL FOR DIALOGUE ON CONCRETE MEASURES TO SOLVE CRISIS.

HAVANA APRIL 26 (IFDA/CHAKRAVARTHI RAGHAVAN) -- The Sixth Ministerial Meeting of the Group of 77 ended here after Saturday midnight with an appeal from the group to its partners to use UNCTAD-VII to launch a dialogue for longer-ranger objective, as well as for concrete measures in specific areas to solve the present world economic crisis.

UNCTAD-VII, the Ministers said, provides a signal opportunity to strengthen multilateral cooperation for development ant to strengthen UNCTAD itself.

"The results of UNCTAD-VII will have an important influence on the attitude of the developing countries towards other international negotiations and activities", the Ministers said in a veiled warning to the OECD countries.

The Ministerial Meeting, preparatory to UNCTAD-VII, adopted the Havana Declaration, an assessment of overall trends in world economy, and in sectoral areas to be considered at UNCTAD-VII, and the proposals of the group for concrete measures.

The group's proposals cover the areas of resources for development, commodities, international trade and Least Developed Countries (LDCS).

The declaration, to be the basis of the group's concerted actions in north-south and south-south relations, is a non-negotiable document, representing the group's "collective appraisal of the world economic situation and perspectives for development".

A 25-page-assessment paper, adopted as part of the final documents of the Conference (to be presented at the may special meeting of the Trade and Development Board), sets out the views and analysis of the group on the international economic environment, and provides the basis and rationale of the proposals, policies and measures advocated by the Ministers here.

The common assessment of the group, it says, is intended to facilitate the understanding of other groups and for "a constructive dialogue and consultations prior to the commencement of the negotiations".

The proposals call for a wide range of measures including solutions to the debt crisis, policies and measures to substantially increase resource flows, the call for a blueprint for an improved international trading system, reforms of the international monetary and finance systems, commodity market and price stabilisation and measures to promote commodity diversification in their world countries, and other measures.

Among its proposals is one calling on the industrial countries to adopt more expansionary macro-economic policies including an easing of monetary policies and fiscal stances where appropriate, with a view to substantially lowering interest rates, reducing protectionist pressures, expanding trade and financial flows, and reversing the decline in commodity prices.

It also called for enhancing UNCTAD's capacity to exercise its "central role", in the inter-related areas of money, finance debt, commodities, trade and development, and called on the UNCTAD trade board to strengthen its review and monitor on a regular basis decisions and measures in this area.

While the meeting completed most of its technical and substantive work by Friday, the adoption of the documents and the conclusion of the meeting was delayed by more than 24 hours, as frantic efforts went on to find solutions to some "political" issues and how to deal with them, and on one or two substantive and procedural questions.

The major delay was over whether the Palestinian and Southern African questions, as also the economic coercion by the U.S. against Cuba, an similar economic actions and military activities against Nicaragua or Libya should be addressed in the declaration.

After almost 24-hours of continuous and informal consultations, the President of the Conference, Ricardo Cabrisas, the Foreign Trade Minister of Cuba, finally put forward a compromise package on these matters Saturday evening, and was accepted by the regional groups, clearing the way for approval of the documents and later for the convening of the final session of the plenary.

Under the package, the Palestinian and Southern African questions were dealt with in the declaration, in a modified way.

Separate resolutions were adopted by the Conference on the coercive economic sanctions against Cuba, Libya and Nicaragua, and expressing the meeting's support and solidarity with these countries.

The Conference also decided to remit to UNCTAD-VII for its consideration, a draft resolution relating to the economic problems of Palestinians in occupied territories and UNCTAD'S continued assistance to hem through its special unit. This resolution had been proposed by the Asian Ministerial Regional Meeting.

The Latin American and the Caribbean Group (GRULA) within the G77 had resisted the views of Asia and Africa for references in the political declaration to these problems, preferring to deal with all of them as separate resolutions, but ultimately accepted the President's package, as also the Asians and Africans.

The way these issues dominated the scene here over the last 24 hours made many delegates, both for and against, wonder whether the group was "losing its sense of purpose", and whether it needed some high-level political leadership form capitals on the basic issues of the crisis faced by the South now.

Among other things the meeting took note of and welcomed the acceptance of the chairmanship of the South Commission by Julios Nyerere.

On debt, the G77 proposals, call for a apolitical dialogue for a comprehensive debt strategy, including measures for creditor governments to take appropriate regulatory measures, to give banks flexibility to reschedule interest payments on debts contracted before 1987, to provide new loans to indebted nations, and to take debt-relief measures such as partial write-off of principal and application of concessional rates of interest.

The proposals also call for policies and measures to increase ODA an other official flows, bank credits, etc... It also calls for adapting IMF conditionality to development and growth, and reforms of IMF decision-making, allocations of SDRS, and other long-standing demands of the third world.

In the area of commodities, it called on the UNCTAD Secretary General to convene preparatory meetings on individual commodities, not now covered by international commodity agreements (ICAS), to be followed as appropriate by negotiating conference and for the programme of negotiations to be completed as far as possible by 1990.

UNCTAD-VII the G77 said, should appeal to all those who had not so far done so, to ratify the common fund agreement and make it operational. The conference should also appeal to the U.S. to reconsider this decision not to ratify.

A meeting of "interested countries", should also be called in 1988 to review the status of the agreement and recommend measures to accelerate its full implementation.

In the area of trade, apart from the proposal for UNCTAD to prepare a blueprint for an improved trading system, the G77 also called for independent and transparent "national mechanisms" in countries to examine sectoral demands for protectionist actions, and to draw up programmes of structural adjustment.

The mechanism should also monitor the implementation of the standstill and rollback commitments, with UNCTAD itself having a monitoring role in these matters.

On LDCS, the G77 proposals call for implementation of the recommendations of the 1986 mid-term global review of the Implementation of the Substantial New Programme of Action (SNPA). In particular the proposals call for achieving the UN aid targets for LDCS (0.15 percent of GNP of donors), debt relief by cancellation of ODA debt and relief for other debt. LDCS are currently estimated by UNCTAD to be spending 20 percent of their export earnings on debt service. The proposals also call for full compensation for LDCS in respect of their export earnings shortfalls.

On OEDC, the Conference, among other things called for effective steps to complete the first round of negotiations on global system of trade preferences (GSTP) to be completed at the Ministerial Meeting in Belgrade (in September) as visualized in the Brasilia declaration of the GSTP negotiating committee.

The chairman of the G77 in Geneva was asked to pursue ongoing consultations on the Chinese request for participation in GSTP.

The consultations, it was agreed, should be in accordance with the 1982 declaration of the Foreign Ministers launching the GSTP (which reserved it to G77 members only), the GSTP declaration in New Delhi in 1985, and the 1986 declaration and final act in Brasilia.

The results of the consultations are to be reported to the meeting of the G77 Foreign Ministers to be held in New York prior to the 24th. General Assembly Session.