May 20, 1987

UNCTAD-VII: SEIZE EXCEPTIONAL OPPORTUNITY, STRENGTHEN COOPERATION.

GENEVA, MAY 18 (IFDA/CHAKRAVARTHI RAGHAVAN) -- UNCTAD-VII presents an exceptional opportunity to pick up the challenge created by the present crisis situation, and the international community should join forces to strengthen multilateral cooperation, the Foreign Trade Minister of Cuba, Ricardo Cabrisas declared Monday evening.

Addressing the 15th special session of the UNCTADís Trade and Development Board, Cabrisas was presenting to the board the "assessment and proposals of the Group of 77 for UNCTAD-VII".

Speaking in his capacity as the President of the Sixth Ministerial meeting of the Group of 77 held at Havana in April 1987, Cabrisas appealed to the other regional groups to engage in a dialogue at UNCTAD-VII to work out a broad and comprehensive international economic system.

Such a system, he said, should be based on principles of equity, justice, harmony, universality and sovereign rights of states. Development, growth, employment and social progress should be its central objectives, and it should give full recognition to the interdependence between money, finance, trade and development.

"Such a system should help establish the new international economic order" the Cuban Minister declared.

The Conference, Cabrisas said, should not take up "too much precious time in diagnosis".

"What we need is action and measures that would enable U.S. to handle the crisis and overcome it".

The crisis in the world economy had many manifestations and no country had escaped it. But the third world countries had been the hardest hit.

The effect of the crisis on these countries was seen in the collapse of commodity prices and deteriorating terms of trade which had deprived them of export earnings needed to sustain their development and service their debt.

The "intolerable debt burden" had compelled many third world countries to adopt, with high social and political costs, adjustment programmes constraining their development potential.

"The debt cannot be serviced and repaid under present conditions and without sustained economic development".

There had been stagnation of ODA and sharp contraction in financial flows, particularly from commercial banks.

All these factors had led to a net transfer of resources from the third world to industrialised countries.

A proliferation of protectionist and distortive measures and policies in the OECD countries were impeding third world exports and obstructing structural adjustments which would permit expansion of those exports.

Moreover, the erosion of respect for the disciplines of the multilateral trading system exposed the third world countries to arbitrary obstacles to their trade and left them without redress.

The structural problems of the least developed countries, especially the landlocked and island developing countries had been aggravated, with a particularly negative impact on their development.

The economic crisis was structural in nature, and had been aggravated by the long-term macro-economic policies of the industrialised countries.

In the present circumstances the potential for growth in the third world could not be realised. But if external constraints were removed and the required systemic changes were made, third world countries could contribute "to the sustained expansion of world trade and growth in the foreseeable future", Cabrisas declared.

The Group of 77 felt that all countries had a common interest in overcoming the present crisis in the world economy, and the group sincerely hoped that the industrialised countries would give adequate and fair consideration to the G77 proposals.

The G77 proposals had been elaborated on this basis, and in a spirit of dialogue and common quest for genuine solutions based on joint interests.

'"We hope this same spirit will underline the activities of other regional groups, and UNCTAD-VII will enable U.S. to make sound progress and that it will not be yet another notch in the growing inventory of frustration and wasted opportunities", Cabrisas declared.

Commending the group's proposals on various agenda issues and for strengthening UNCTAD's capacity Cabrisas added: "UNCTAD must emerge strengthened from this challenge with clearly established programme of work".