5:39 AM Oct 3, 1994

RENEWED COMMITMENT TO OBJECTIVES, ROLE OF UNCTAD

Geneva 1 Oct (Chakravarthi Raghavan) -- The continued validity and relevance of the development objectives of UNCTAD and need for a fresh vision of development to deal with the many new challenges in a changing world were reiterated at the Trade and Development Board on the occasion of the observance of 30th anniversary.

Representatives of regional groups, former UNCTAD Secretary-General Gamani Corea and the Officer-in-Charge Carlos Fortin were among those who stressed the continued relevance of the original objectives and conceptual frameworks leading to the founding of UNCTAD 30 years ago, the continuance of many of the problems affecting development identified at that time and need to reinterpret or rethink programmes and policies in the light of the new changes and parameters.

In a declaration adopted by the Board, member-states reaffirmed their commitment to UNCTAD's primary development objectives and undertook to reinforce their political commitment to the institution and its important role.

The Declaration said that past achievements should encourage UNCTAD to pursue its development mission with new vigour at a time when long-standing problems were being compounded by new ones. The major source of change was the intensifying process of globalization of economic activity and of interdependence among countries and between sectors of the world economy, and its implications for sustainable development.

While each State and society had the primary responsibility for its own social and economic development, the globalization process had reduced the autonomy of governments in conduct of national economic management, and creating challenges and opportunities for the systems, structures and arrangements that underpin international economic relations. This required appropriate efforts to overcome difficulties in adapting national and international structures to the new international economic environment. The internationalization of financial, product and service markets, coupled with rapid advances in information and communication technologies, represented a growing challenge to competitiveness of countries and firms. Some of these risked accentuating the trend towards a world economy in which a large number of developing countries, particularly the LDCs among them, would be unable to keep pace and might continued to be locked into a vicious circle of poverty, under-development and environmental degradation.

The international community should therefore take appropriate action in support of the weaker economies in the Spirit of Cartagena. A fresh vision of development able to deal with these challenges was therefore required. Implementing such a vision will require strengthened cooperation for development between developed and developing countries and also an integrated approach to issues in the fields of trade, finance, investment, services, technology and environment.

UNCTAD, the Declaration said, could make a valid contribution to the better understanding of the contemporary development problems, and is well placed to conduct a systematic exploration of the inter-linkages between economies, sectors and issues and to promote a consensus for the adoption of appropriate policies. UNCTAD will also have an important role in undertaking policy analysis on the impact of the Uruguay Round Agreements and on new issues as they come to the fore of the international trade agenda.

"Member States reaffirm their commitment to the primary development objectives of UNCTAD and undertake to reinforce their political support for the institution and for its important role, as a member of the wider United Nations family, in strengthening the global Partnership for Development by addressing the economic and development problems of all countries, particularly the developing countries," the Declaration concluded.

Dr. Gamani Corea, who was a Sri Lankan delegate to UNCTAD-I and its Secretary-General from 1974 to 1984, said that the imperatives of development remained as valid as when UNCTAD was founded 30 years ago, even when the changes may call for some re-thinking. As an organisation concerned with the development dimension and the international economic framework UNCTAD had a continuing role to play in this re-thinking and "has to follow the evolution of the international economic system with a watchful eye on how this will impact on the development process". There was no agency better suited to fulfil this role.

But for UNCTAD to succeed in this, three basic conditions had to be fulfilled, Corea said.

Firstly, there had to be a recognition that the development process was in the fundamental interest of both the South and the North and there was a mutuality of interest of all member-states in a dialogue to advance this process.

Despite the many preoccupations of the international community, it was still true that peace ultimately depended on stability and economic progress of the entire world. Tension, turmoil, trouble and instability in the developing countries tended to spill-over national boundaries and no country could be insulated and no iron curtain drawn around it, to make it safe from this destabilization.

It was UNCTAD's function to articulate this common interest of all States in the success of the development process. UNCTAD's activities and contribution to this dialogue must increasingly take account of the changes taking place in the international context.

Many of the basic goals -- commodity problems, terms of trade, resource flows, relief from the crushing debt burden, technology transfer etc-- still remained valid. But they have to be reinterpreted in the new context. UNCTAD has always to recast its programmes and analysis in order to take account of these changes, not necessarily to replace old objectives by new, but simply to make sure the validity of the basic objectives are restated in the new and changing context.

And while there was a need to better understand concepts of development in the context of the new issues (human resources development, environment protection etc) and wider parameters "it is important not to downgrade the original goal of economic growth but make it part of a mutually reinforcing process in which human development, environment protection support and sustain the process of economic growth and development," Corea stressed.

Finally, Corea said, there was a third condition for the successful future of UNCTAD.

UNCTAD will always have to focus on development and ensure that its member-states remain sensitive and receptive to the development process. But the responsibility for this rested heaviest on the developing countries themselves, by enhance their presence, increasing their effectiveness and playing a more vital role, in partnership with other countries, and augmenting their negotiating capabilities so that the work of UNCTAD can proceed from debate and discussion to action and working out arrangements to support the development process.

Earlier, Carlos Fortin, Officer-in-Charge of UNCTAD, recalled that UNCTAD was created in 1964 because the overwhelming majority of UN member States believed that a cooperative effort of the international community was required to bring about changes in the world economic order to allow developing countries to participate more fully in, and thus benefit from, a prospering world economy. UNCTAD's was an action-oriented effort, whose theoretical justification and conception, a powerful combination of analysis and action recommendations, was provided by Dr. Raul Prebisch.

Despite the current received wisdom that it was dirigiste and inward-oriented, a re-reading of the documentation for UNCTAD-I, Fortin said, showed this charge to be inaccurate and unfair. Its analysis was quite nuanced -- fully aware of need to use market instruments and the dynamic developmental impact of international trade expansion.

There was perhaps more of a faith, than current today, in the virtues of benevolent States to promote and effect development domestically and collectively correct defects in the international economic order. But the mission assigned to UNCTAD remained as valid now as then,, enshrined as it was in the commitment of member States "to lay the foundations of a better world economic order" through the recognition that "international trade is an important instrument for economic development"

In the contemporary world, several developing countries had been able to seize the vast potential of the combination of global events and trends to register a degree of economic and social progress. But it was clear that by itself this cannot resolve the problems of equitable participation within and among nations in the creation of wealth and distribution of its benefits.

But the gap between the 'haves' and 'have-nots' had widened. While the richest 20% of the world's population had 30 times the income of the poorest 20% in 1964, the gap had now doubled to sixtyfold. In today's knowledge of economy, the relations between basic economic variables had undergone fundamental changes and it was UNCTAD's mandate and responsibility to comprehend the nature and implications of the changes sweeping through, and modifying, the world economy.

The policy thrust of work of UNCTAD in the last few years, Fortin stressed, had already shown some avenues for future orientations.

In trade, UNCTAD had moved to the forefront of institutions demanding that the international trading system live up to its agreed goals of multilateralism, fluidity, openness and non-discrimination and move decisively to a situation in which goods, services and people can move freely across borders. UNCTAD had been the arena where many developing countries demand, not privileged treatment but a fair chance to realise their comparative advantage in the international economy. At the same time the need for international help and support to developing countries, notably the LDCs, to reach the point where they can compete internationally has been reaffirmed.

The concern for environmental consequences of both the working of the market and the special measures that might be agreed to had been put at the forefront and "fair opportunities for all combined with special support for the weak in the search for sustainable development, seem to be the notions defining policy orientations of many of the debates in UNCTAD today".

The next UNCTAD Conference, Fortin said, would represent the first opportunity for the international community to reflect with some perspective on the deeper meaning of the momentous changes the world had witnessed in the 1990s.

"The intellectual challenge for UNCTAD is to define the parameters and characteristics of the new development problematique and to develop a constructive analytical response to the underlying issues. This work should pave the way for the promotion of common perceptions and for consensus building among member-States in such a way as to give impetus to action by governments, whether in UNCTAD or elsewhere".

Pragmatism was also the hallmark of current UNCTAD debates on development policy. For each country there was an appropriate combination of domestic policies and external conditions which needed to be identified and promoted. And an important aspect of UNCTAD's work in coming years might therefore be to explore not only the dynamics of the world economy and interactions among different policy areas, but also the workings of developing countries and the links which bind these economies to their external environment and help or hinder their development.

The magnitude of the task should not be under-estimated. But integrating the developing economies into the mainstream was nonetheless in common interest. There was the ethical imperative. But beyond that lay the prospect of gains for all: the contribution to world demand that could be made by many countries now unable to express their full development potential could not be ignored, at a time when many important economies were operating below capacity.

More ominously, there was the threat posed by other manifestations of the globalization process, with their harmful transboundary effects. Economic decline often translated into environmental degradation and flow of refugees and migrants into prosperous neighbouring countries. Epidemics, terrorism and illicit narcotics traffic had implications reaching beyond national frontiers.

"These potential conflicts cannot be averted except in the context of development that eliminates great disparities and hardships and gives coherence and hope to societies," Fortin emphasized.

In other speeches on the occasion, Sri Lanka, for the Asian group, said that the role envisaged for UNCTAD under the Cartagena Commitment -- policy analysis; intergovernmental deliberations; consensus building and negotiations; monitoring, implementation and follow-up; and technical cooperation -- gave it a complimentary role to that of the WTO which was vested largely with powers of decision and rule-making. "As the international trade agenda becomes more complex and tend to involve aspects of economic and social policies outside the traditional policy arena, the need for UNCTAD to take over functions not envisaged for the WTO (such as creation of ideas, policy analysis, consensus-building and technical assistance and advise to weaker trading partners) would become more important than ever. UNCTAD had a crucial role to play in the area of trade and development and it was the most appropriate focal point within the UN for the integrated treatment of development and inter-related issues.

South Africa, for the African group, said that UNCTAD had lived through some difficult times. The developed and developing worlds had not always agreed on the issues, priorities, needs and methods concerning development of countries. But it was precisely because of it that UNCTAD had served a very important role in bringing all these views into the open where it could be discussed. As a result of UNCTAD-VIII and its Cartagena Commitments, a method and an agenda for negotiations had been developed and this would allow UNCTAD to play its rightful role in helping the developing world achieve UNCTAD's initial aims of improving the welfare of people all over the world.

Trinidad and Tobago, speaking for the Latin American and Caribbean Group, said it was important UNCTAD be given the mandate to consolidate past gains and meet the awesome challenges facing developing countries. In fulfilling its new role in a changing world, UNCTAD should not lose sight of this main concern -- engendering change in the international environment which would be more conductive to the needs of the developing countries. To fulfil this mandate, the UNCTAD's membership "must display a greater understanding of the challenges, keener appreciation of the nature of interdependence and a stronger affirmation of political will, shared in equal measure by developed and developing countries."

China said while the world's political and economic situation was experiencing profound and complex changes, peace and development remained the two major challenges requiring solutions. The economic conditions of the vast number of developing countries was still of great concern. The international economic environment facing them was yet to be improved and the North-South gap was ever-widening. All this showed development as an arduous task and UNCTAD was far from having fulfilled its mandates. Its responsibilities were heavy and it still had a long way to go. Against this background, UNCTAD's role and function should be strengthened, not weakened.