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Southern Aid & Trade

UNDP Predicts Rise of the Global South

UNITED NATIONS, Jul 13 2012 (IPS) - When the U.N. Development Programme (UNDP) unveils its annual flagship Human Development Report (HDR) in mid-October, the primary focus will be on a growing new phenomenon on the economic horizon: the rise of the global South and the significant progress in South-South cooperation over the last decade.

The developing world maintained an average annual gross domestic product (GDP) growth rate of 4.8 percent during the last 10 years, and now accounts for around 45 percent of global GDP.

And in 2010, developing and emerging economies recorded an average growth of 7.3 percent, “which was significantly greater than that of economies in the North,” says UNDP Administrator Helen Clark.

These trends, she told a recent meeting of the High-Level Committee on South-South Cooperation, “contributed to progress on achieving the Millennium Development Goals (MDGs) in many countries.”

Undoubtedly, the dynamism of the South will continue to be reflected in strong development outcomes, predicted Clark, a former prime minister of New Zealand.

Rob Vos, director of Development Policy and Analysis at the U.N.’s Department of Economic and Social Affairs (DESA), told IPS that South-South cooperation is becoming increasingly important, and “one should expect this to increase further in times ahead of us”.

He pointed out that China has already become a major financier in Latin America.

The Chinese export-import bank and the state development bank together are already providing more long-term financing to the region than the World Bank and other multilateral development banks, he added.

“While still much less than traditional development cooperation, South-South development financing and technical cooperation with Africa is also of increasing importance,” Vos said.

Perhaps even more important, he pointed out, is the growing South-South trade and investment, which is helping some regions to mitigate some of the adverse effects from the economic slowdown in developed countries.

The South-South trend is also moving from bilateral to multilateral relationships.

Last May, the Nairobi-based U.N. Environment Programme (UNEP) launched a South-South Exchange Mechanism connecting people to innovations and best practices, including an online initiative to improve the sharing of resources and expertise among sustainable development projects in the global South.

Developing countries, says UNEP, have now overtaken developed nations in terms of large-scale renewable energy investments.

The UNDP, meanwhile, has been signing new partnerships with several new emerging economies of the South on sharing knowledge and innovations across the global South.

According to Clark, UNDP has built a partnership with the International Policy Centre for Inclusive Growth in Brasilia to facilitate efforts to make Latin American experiences of cash transfers and social protections known to other regions.

She said UNDP has also established the Seoul Policy Center for Global Development Partnerships in South Korea; participated in the establishment of the International Poverty Reduction Centre in Beijing, China; and helped establish the International Centre for Private Sector in Development in Istanbul, with the cooperation of the Turkish government.

Meanwhile, the Paris-based U.N. Educational, Scientific and Cultural Organisation (UNESCO) has set up an International Centre for South-South Cooperation in science, technology, and innovation in Malaysia while the Geneva-based International Labour Organisation (ILO) has established the Inter-American Centre for Knowledge Development in Vocational Training in Latin America and the Caribbean.

At the same time, the Vienna-based U.N. Industrial Development Organisation (UNIDO) has established several South-South cooperation centres in China, India, Brazil and other middle-income countries to facilitate industrial development.

Clark said that in 2010, UNDP organised the Africa-China Poverty Reduction and Development Conference in Ethiopia to discuss breakthrough approaches emerging from the South in reducing poverty, accelerating broad-based growth, and advancing progress towards the Millennium Development Goals (MDGs) in Africa.

“China’s experience in lifting hundreds of millions of people out of poverty and how that was achieved is of considerable interest,” said Clark.

She singled out UNDP’s Special Unit for South-South Cooperation for helping establish service platforms to document, showcase and exchange Southern development solutions.

“In its role as a U.N. system-wide facilitator and coordinator of South-South cooperation, the Special Unit continues to facilitate the sharing of experiences and good practices in South-South cooperation among U.N. agencies,” she added.

Asked where all this will lead to, Vos told IPS that it is “changing economic geography, that’s for sure”.

For Africa, however, most of trade and investment with the “global South”, but China in particular, appears to be perpetuating some old patterns, he said.

African exports mainly consist of raw materials and its imports of manufactured products, he added, pointing out that direct investments from China are largely in extractive industries as well.

“Hence, new geography but otherwise more of the same? Well, it does not need to be,” Vos said.

He said much support from China, India and Brazil to Africa takes the form of infrastructure finance and technical cooperation for agriculture, medicine and education.

“The trick for African nations will be to take such support to its advantage and promote the further diversification of their economies, adapt knowledge and new technologies to local needs, and improve health and education systems.”

That way, he said, “the new geography will become a boon, not a bane.”

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john arigo