Aug 9, 1988


MEXICO CITY, AUGUST 8 (IFDA/CHAKRAVARTHI RAGHAVAN) -- "If we do not watch out we might have a new international economic order coming out of the (Uruguay Round) negotiations which is worse than the present one" the chairman of the South Commission, Mwalimu Julius Nyerere, warned Monday.

Nyerere was answering questions at a press conference where he released to the media the statement on the Uruguay round adopted by the Commission at its four-day meeting in Mexico.

Asked whether it would be realistic to recommend a new international economic order in the present circumstances, Nyerere said it would all depend on the definition of the new international economic order.

The Uruguay round of Multilateral Trade Negotiations currently in progress "are indeed an attempt to establish some king of order in the international economy", Nyerere said.

"The industrialised countries have their own idea, and are clear in their minds as to what they want. What we are suggesting here (in our statement) is that if the south does not watch out we are going to have a new international economic order not to our liking. The present is bad enough, but if we do not watch out, we might have a new international economic order coming out of the negotiations which is worse than the present".

"We do want a new international economic order", Nyerere went on. "We have always asked for a reform of the present international economic order which is not just order. We shall seize every opportunity, if we have no global negotiations, to improve the existing order. We are saying that if the third world works together, there is a possibility of improving the situation through the Uruguay round".

While there are obstacles in the way of the unity of the south over the Uruguay round, the Commission would not have made the recommendation for a united response from the south, "if we did not believe it was feasible".

The Commission was recommending a concerted response by the third world, and saying that the third world would not be able to make an effective case for itself unless the countries of the south come together.

It was argued that the south was not a monolithic one, that there were many differing interests. The Commission had also been told that there was no tradition in GATT of the countries of the south working together. But the Commission had also been told of the unwritten tradition in GATT of the north working together, but not the south. A major problem was that the north did try to exploit the differences of the south. "But I do not believe the obstacles are insurmountable. If the south wants to come together, they can come together".

On the debt issue and the Commission’s recommendation at its Kuala Lumpur meeting in march for the formation of a "debtors’ forum", Nyerere said he had forwarded the statement to all the heads of states/governments of the third world, and he had received some responses. But it would be wrong to expect that third world governments could take account of the recommendation, made in March, and act on them by August, Nyerere added.

The governments of the third world would be considering this matter, and while he could not say what would happen, he was sure that the governments would consider it.

Nyerere did not believe that the countries of the south had "lost the opportunity" on the debt issue. But it was essential for the third world to be united and work together on this issue.

Bankers who lent money want their money back and did not want to lose it. They want the lending process to continue. There was thus a mutuality of interests between the lender and the borrower that the borrower should continue to be in a position of paying back.

"But the north is behaving completely unintelligently", Nyerere declared.

"If they cut off further resources to the debtor countries, as they have done, how can they be paid back? The debtors cannot pay their debts back".

"It is possible that the north relies on power, and says ‘we will get our money back whether you like it or not’. This is true to some extent".

"But a time will come when the countries that cannot pay will say we cannot pay. Hence, for the smooth functioning of the international economic system, the debt problems have to be resolved, both by the north and the south".

"But in the real world where power makes people behave unreasonably, the south has to evolve a little power of its own through unity. The possibility of losing their money will then make the north be more reasonable"