UNCTAD-VII: GLOBAL PROBLEMS NEED JOINT SEARCH FOR SOLUTIONS.

Jul 15, 1987

UNCTAD-VII: GLOBAL PROBLEMS NEED JOINT SEARCH FOR SOLUTIONS.

GENEVA, JULY 13 (IFDA/CHAKRAVARTHI RAGHAVAN) – The Soviet Union Monday called for "new thinking" in UNCTAD that would find expression in "a transition to a broader and constructive cooperation between problems in contemporary world economy".

The Soviet Foreign Minister, Boris Aristov, who was addressing the plenary of UNCTAD-VII devoted his speech to the issues on the agenda of the Conference, and invited all participants "to demonstrate at this session a far-sighted political approach and common sensei and take a flexible and realistic position in elaborating joint arrangements".

"Our task", Aristov said, "is to elaborate jointly solutions of the major issues of the world economy and trade ... rejecting out-of-date traditional political and economic thinking and by revising approaches to existing problems which failed to work".

The Soviet Minister, the first speaker when the plenary resumed Monday morning, placed the Soviet views on international economic and trade relations in the context of the domestic policy changes, and said: "the revolutionary reforms aimed at the acceleration of the progress of the socialist society ... and are also aimed at extension of USSR’s participation in the international division of labour which will promote the development of international trade".

A major part of Aristov's speech was devoted of the UNCTAD agenda issues, and his remarks on debt and resources for development, commodities and trade provided broad support to the viewpoints being pressed by the Group of 77.

At the end he also announced soviet decision to join the common fund agreement.

Aristov said that the soviet union, with the majority of the countries, stood for restructuring of international economic relations on an equal and democratic basis, and for adherence to the charter of economic rights and duties of states, and the implementation of the UN programme of action for establishment of a NIEO.

The Soviet concept of economic security of states was fully in line with that programme, and would give new impetus to strengthening confidence in international economic affairs, he said.

Linking the NIEO issue with issues of disarmament and development, and the third world views associating deliverance from debt burden with limitation and elimination of armaments and reallocation of resources, Aristov suggested UNCTAD could contribute to elaboration of principles for use of resources diverted from arms reductions.

The external debt issue on the agenda of the Conference, he said, had acquired "a truly global character, has overflowed the economic framework and has evident political coursing".

Debt payments, he noted, now consumed one-fifth of third world accumulation of funds and one-third of its export earnings.

Aristov proposed that annual repayments on external debt should be limited "to such a proportion of exchange earnings that would not prejudice the interests of social and economic development".

He also proposed steps to combat protectionism, to lower interest rates and to stabilise exchange rates "by action, and not by words".

The monetary and financial system should also be reconstructed, "taking into account the interests of all states, and to democratise the financial institutions functioning with it".

Solutions to debt problems should take account of the debt of the least developed countries (LDCS), and also "other proposals that might lead to the global solution of the problem".

UNCTAD could contribute to the solution by considering them in relation to development, and the "important phenomenon of outflow of financial resources from developing countries".

The problems of the international monetary system and plans to reform it, he suggested, could be specially discussed at an international conference on monetary and financial issues, "with the conference convened on a universal basis under the auspices of the UN or some other representative forum with the participation of all interested countries".

On the commodity issues, the soviet minister said that international commodity agreements (ICAS) were "the most acceptable commodity to the majority of countries as a means of regulating commodity trade".

UNCTAD could contribute to the elaboration of such agreements, and improvements of mechanisms through which such agreements influenced their respective commodity markets.

Future work in UNCTAD should be continued through enlargement of the range of commodities covered by ICAS.

Aristov also called for "business-like and constructive examination" of ways and prospects of development of international trade.

At present there was a growing number of violations of the basic principles of international trade - non-discrimination and most-favoured--nation treatment. Protectionist trends were gaining strength, non-tariff barriers were expanding and the restrictive business practices or TNCS were increasing.

The Soviet Union, he said, was in favour of adoption of 'efficient and fair measures' aimed at development of "an equal and open-to-all democratic multilateral trading system, interlinked with reciprocal rights and obligations".

The adoption within UNCTAD of a programme for further development of trade and economic cooperation among countries with different social systems (east/west and east/south trades) would be of great importance.

The Soviet Minister considered as "interesting" the G77 idea of consultations within UNCTAD on launching the process of multilateral negotiations on further strengthening of trade and economic cooperation among third world and socialist countries.

The Uruguay round, he said, could achieve truly effective results "only with the participation of such a major trading nation as the USSR".

On the situation of LDCS, Aristov said it was the duty of the international community to alleviate their situation. The continued aggravation of their social and economic situation was "a reproach to the world community as a whole".

On Soviet economic relations and cooperation with the third world, Aristov said that net Soviet assistance to the third world in 1986 amounted to 15.1 billion roubles (equivalent to 24 billion U.S. dollars), and this included two billion roubles (3.2 billion US$) to the LDCS.