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DEVELOPMENT MUST REMAIN AT TOP OF GLOBAL AGENDA

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GENEVA, May 1 2006 (IPS) - These are difficult times — both for the United Nations, and for the world. It is thus all the more imperative to ensure that development remains at the top of the global agenda, writes Supachai Panitchpakdi, Secretary General of the United Nations Conference on Trade and Development (UNCTAD). There are increasing pressures on developing countries to open their markets, with the promise that this is the key to making the biggest gains. Such promises should not be allowed to disguise the fact that there are still serious trade barriers to the key exports of developing countries as a whole –both tariff and non-tariff barriers– that need to be addressed. Indeed, a worrying trend is the resort to new forms of protection as tariffs and quantitative restrictions have come down.

The recommendations of the September 2005 World Summit of the United Nations along with the related processes of UN reform are now in the midst of implementation. Although we have a good understanding of many of the elements, we have yet to see how all of this will play out.

Nonetheless, a clear message emerged from the Summit, as world leaders recognised that ”democracy, development, and respect for all human rights and fundamental freedoms are interdependent and mutually reinforcing”.

But is the world community doing enough to address the fundamental development problem?

The success of a few players doesn’t hide the fact that in the past 20 years, the number of the Least Developed Countries (LDCs) has doubled. We read daily of new threats of hunger and famine. Over a billion people are living on less than one dollar a day. War and civil strife prevail in many parts of the developing world. And a number of low-income countries, especially sub-Saharan African nations, LDCs, and those developing countries with small and vulnerable economies, remain marginalised from the trading system. Many of them are still commodity-dependent, unable to escape the negative terms-of-trade and poverty trap. The LDCs and African countries account for a paltry 2 percent share in world exports of both goods and services. Clearly, not enough resources are being devoted to solving these problems, which are a blot on the face of the international community.

One area where we have recently seen some modest progress is in the ongoing global trade negotiations at the World Trade Organisation (WTO). The developing countries won a few concessions at the Hong Kong Ministerial Conference in December 2005.

On the other hand, though, there are increasing pressures on developing countries to open their markets, with the promise that this is the key to making the biggest gains. Such promises should not be allowed to disguise the fact that there are still serious trade barriers to the key exports of developing countries as a whole –both tariff and non-tariff barriers– that need to be addressed. Indeed, a worrying trend is the resort to new forms of protection as tariffs and quantitative restrictions have come down. Exports today face new hurdles, such as sanitary and phytosanitary measures, anti-dumping and special safeguards, all of which are hard to quantify and hard to beat. They are also highly discriminatory and pose a considerable challenge for developing-country exporters.

Of course, the pressure on developing countries arises largely from the fact that the North has realised the potential of accessing developing-country markets for its own goods and services. It is this recognition that lies behind their argument that the market reforms they are demanding from the developing world are beneficial in their own right. But now we have learned a thing or two about reform — namely, that while it has brought notable success to some countries, others have been left wallowing in stagnation and even greater impoverishment.

Indeed, it is extraordinary that after 20 years of reforms, the world community still has no magic formula for development success. We need to advance our thinking and understanding of these complex and rapidly evolving areas. We need to support our proposals with real efforts on social safety nets, infrastructure, institution- and capacity-building. Aid for trade can make a difference in this regard, and is on the whole to be welcomed. But if it is to be effective, it will require real new resources and coordinated activity by the donor community.

South-South trade is an area to which we have traditionally devoted considerable attention. It is encouraging to see the phenomenal growth in this trade, which I understand has outstripped that of world trade in recent years, expanding at about 11 percent a year. Developing countries’ share in world trade in goods has risen from 24 percent in 1990 to 33 percent in 2004, and from 19 percent to 23 percent for trade in services. And while most of the exports of developing countries still go to the North, some 43 percent is destined to other developing countries.

Even more South-South export opportunities could be exploited by mutually lowering tariffs and other market access barriers. The third round of the Global System of Trade Preferences Among Developing Countries (GSTP) negotiations launched at the XI United Nations Conference on Trade and Development (Sao Paulo, June 2004) provides a useful vehicle in this regard. It could be a valuable complement to developing countries’ efforts to achieve greater market access in the North, where progress is often slow.

South-South cooperation can also facilitate investment in much-needed infrastructure for trade — investment that is often too costly to be borne by one country alone. This is particularly important for building crucial transport linkages, such as roads and ports.

These are difficult times — both for the United Nations, and for the world. It is thus all the more imperative to ensure that development remains at the top of the global agenda. (END/COPYRIGHT IPS)

 
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