UN-DEVELOPMENT: Summer Deadline For New-Look UNIDO

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IPS Correspondents

LONDON, Apr 27 1997 (IPS) - The lead nations of the United Nations Industrial Development Organisation (UNIDO) have set themselves a summer deadline to agree on a revised mandate and pick a new director general to steer it into the next century.

The agency’s prospects look a little better after last week’s session of its policy making executive Industrial Development Board in Vienna. At one point UNIDO looked as if it would be powerless to prevent its U.S. critics from closing it as part of Washington’s long-demanded structural reform of the world body.

After extending the meeting by two days, the 53 nation IDB finally agreed to set up a working party to come up with a plan for a streamlined UNIDO by its next session on 23-27 June.

“Time is running out,” De Maria y Campos told the IDB in his last words to last week’s extended sessions. “UNIDO urgently needs budget guidelines and the political commitment that will ensure its survival.”

The agency has been under threat since the U.S. walked out, effective from end 1996, refusing to pay outstanding contributions totalling nearly 70 million dollars. Britain and Australia have warned they will withdraw at the end of the year. Germany is still to make a final decision on leaving.

Maurice Strong, the newly appointed reform coordinator of the United Nations has also recommended that UNIDO shut down, citing overlap with other U.N. economic development bodies. But UNIDO has responded to the challenge.

De Maria y Campos says the body is much leaner and more efficient today than in 1993, making it a model for other U.N. agencies. The U.S. had demanded and got a 25 percent cut on UNIDO’s 1996-97 budget to 158 million dollars over a two year period. Personnel was also down to about 800 against nearly 1,300 in late 1993, he added.

Last week’s IDB special session – its agenda title confidently revised from ‘The Future Of UNIDO’ to ‘The Future UNIDO’ – heard European delegates in particular praise the agency’s reforms to date. Danish representative Jorgen Rud Hansen Bojer announced the preliminary conclusions of a special review that had confirmed that the focusing and streamlining of UNIDO achieved by April 1997 had met all the required targets.

“But the severe budget reductions – which were not foreseen at the time when the reform process was initiated – may require further focusing and some added efficiency-enhancing administrative rearrangements”, said the Danish Ambassador.

Yet Bojer, previously a critic of the agency, said the countries of the European Union considered that UNIDO’s efforts had “gone far beyond” what has been done in other U.N. bodies and that “within a very short span of years, has improved its cost-eff ectiveness considerably so as to become the U.N. agency with the lowest administrative and operational support costs.”

The Dutch ambassador J.A.F.M. Forster, observed that “UNIDO’s record is more impressive than that of many other U.N. bodies which are in equal need of reform”.

While some countries urged that savings achieved through reforms should be reinvested in technical priority areas of UNIDO’s work, others recognised that there was scope for further efficiency- enhancing measures. The IDB has charged its policy review working party with addressing these issues, and find ways to allow UNIDO to focus on specialist tasks, shifting still more of its resources into the field.

Sectors of special interest include working towards environmentally friendly industrial development – the organization is the main agency for implementing the Montreal Protocol on atmospheric pollution – and more schemes such as last years’ Japanese-Austrian funded programme for reduction of mercury pollution in Tanzania. UNIDO can also be expected to concentrate on investment promotion in developing countries, technology transfer, capacity and institution building, small and medium-sized enterprises, and agriculture.

The working party will also consider how to strengthen UNIDO’s focus on Africa and the world’s least developed countries, while also paying attention to countries with economies in transition.

A replacement for de Maria y Campos will be agreed after the new shape of UNIDO has been approved. The job must build on the extensive restructuring done so far and attract the highest quality candidate as its head. Haitian Gerard Latortue, a retired UNI DO director, is the only formal nomination for the job so far.

By postponing the election until September and keeping nominations open until July, UNIDO want to use its new mandate as a means to attract high quality candidates and shed the reputation it endured under the rule of de Maria y Campos’s predecessor, Domi ngo Siazon of the Philippines. Siazon’s tenure saw UNIDO acquire an image as a bureaucratic body that saw its role as a top-to-bottom central planner seeking common cause with old-style command economies.

The new UNIDO is very different: Through the period of cuts the organisation has expanded its work. Between 1993 and 1996, new projects approved increased by 40 percent, from 72 to 101 million dollars. “High-impact” programmes that involve the private sector have boosted support considerably.

In 1996, they included a 2.3 million dollar contribution from Germany for quality food processing in seven sub-Sahara nations, with preparatory work underway to extend the programme to other African countries. More than one million dollars from Japan, Sweden, Korea and the United Nations Development Programme was earmarked for UNIDO’s advisory services for industrial policy formulation and competitiveness strategies for Vietnam.

UNIDO projects to foster women entrepreneurs in Mali, Senegal and Cote d’Ivoire received one million dollars in backing from Belgium, while Italy provided more than three million dollars for promoting small and medium-sized industrial enterprises.

UNIDO, like other U.N. agencies, operate independently with their own budgets and executive commissions. Any moves to consolidate or cut them back would require broad support among the 185 member states. Last June, the leaders of the world’s seven major industrial nations – the United States, France, Britain, Canada, Italy, Japan and Germany – called for consolidating U.N. development agencies and appointing a deputy secretary-general to oversee the new body.

British foreign secretary Malcolm Rifkind informed both U.N. Secretary General Boutros Boutros-Ghali and de Maria y Campos, on Dec. 9 that his country shared a U.S. view that there was no need for a U.N. agency specialising in industrialisation.

“We (the British government) also have some concerns over the extent to which publicly funded bodies such as UNIDO should be involved in the development of the industrial sector,” he said.

But in his concluding remarks to the IDB last week, De Maria y Campos made a plea to the major donors to review their positions.

“The developing countries and countries with economies in transition, have already reaped the benefits of our services, and are looking forward to our future help in securing a better standard of living, greater employment and a more stable future for their peoples, ” he said.

“I share the hope expressed by many countries attending the Board that a spirit of partnership and international solidarity will prevail and that Australia, Germany and the United Kingdom will reconsider their positions.”