23 October 2012
General Assembly
GA/EF/3345

Department of Public Information • News and Media Division • New York

Sixty-seventh General Assembly

Second Committee

14th & 15th Meetings (AM & PM)


Trade Imbalances Worsening Effects of Global Crisis for Least Developed Countries,


Second Committee Told during Discussion on Macroeconomic Policy Questions


Members Also Conclude General Exchange of View on Financing for Development


Adverse imbalances in international trade were exacerbating the impacts of the global economic and financial crisis, especially for developing countries, Algeria’s representative said today, as the Second Committee took up macroeconomic policy questions.


Speaking on behalf of the “Group of 77” developing countries and China, he said the turbulence in international trade was costly and disruptive, especially for least developed countries and African States.  He described international trade as a “vital tool” for long-term sustainable growth, emphasizing that developing countries should be spared from protectionist barriers, especially agricultural subsidies, and calling for the extension of trade-related technical and capacity-building assistance to them.


Many delegations voiced the need for vigilance against rising protectionist measures, pointing out that least developing countries were already struggling to stay afloat in the increasingly volatile global economy.  A fair, balanced and equitable international trade environment was urgently needed to address the effects that the multiple global crises were having on them.


Benin’s representative, speaking on behalf of the Group of Least Developed Countries, said that despite the international consensus around the imperative of ensuring development-centred globalization, the international trading system stood at a crossroads because the Doha negotiations remained at an impasse.  Least developed countries in particular were deeply concerned that the specific package related to their situation — including duty- and quota-free market access in the rules of origin, specific outcomes for trade-related aspects of cotton, a service waiver and accessions — had not materialized.


He called on Member States to address non-tariff measures and eliminate arbitrary or non-justified trade barriers; to facilitate and accelerate negotiations with acceding least developed countries; and to define and agree on the details of a monitoring procedure for duty- and quota-free market access and rules of origin.  Among other things, the Group of Least Developed Countries also called upon development partners significantly to increase the share of assistance granted through “Aid for Trade”, and to help strengthen the capacity of least developed countries to access available resources, in support of the needs and demands expressed in their national development strategies.


Jamaica’s representative, speaking on behalf of the Caribbean Community (CARICOM), stressed the importance of debt alleviation for the subregion’s small island economies, several of which were among the world’s most highly indebted.  Many CARICOM members were also middle-income countries, a designation that limited access to concessionary financing and debt alleviation, he noted, adding that graduating to middle-income status was “a double-edged sword” that indicated progress but also masked grave challenges, including high debt-to-gross domestic product (GDP) ratios.  A more systemic approach was needed to provide middle-income countries with the necessary fiscal space to address the development needs of the most vulnerable, he said.


Echoing the belief of many delegates that the mandate of the United Nations Conference on Trade and Development (UNCTAD) should serve as the focal point for the integrated treatment of trade and development, that body’s President noted that after immense efforts by all parties, including Ministers and other high-level participants in its thirteenth Meeting had reached a consensus.  That had been a major feat against the backdrop of persistent threats to sustained recovery, the ongoing fragility of the world economy, rising income inequality, widespread unemployment and deadlock in the World Trade Organization, he said.  The Doha Manar, the outcome document from UNCTAD XIII, served as a declaration that development was a universal concern and development-centred globalization a common cause.


Many representatives emphasized the need to reform the Bretton Woods institutions, with several also expressing the belief that continued support for efforts to strengthen the multilateral trading system in a rules-based, open and equitable manner way was crucial.


Introducing reports for the Committee’s consideration were the Director of UNCTAD’s Division for International Trade in Goods and Services and Commodities; the Director of the Financing for Development Office in the Department of Economic and Social Affairs; and the Head of the Debt and Development Finance Branch of UNCTAD.


Also speaking on macroeconomic policy questions today were representatives of Qatar, Malaysia (for the Association of Southeast Asian Nations), Australia (for the Cairns Group), Canada (also for Australia and New Zealand), Lao People’s Democratic Republic, Russian Federation, Republic of Korea and Libya.  A representative of the European Union delegation also spoke.


Speaking earlier as the Committee concluded its consideration of financing for development were representatives of Pakistan, Mexico, Trinidad and Tobago, Peru, Burkina Faso, Cameroon, United Republic of Tanzania, Guinea, Zambia, Sudan and Venezuela.


The Committee will meet again at 10 a.m. Wednesday, 24 October, to continue its general discussion on macroeconomic policy questions.


Background


The Second Committee (Economic and Financial) met this morning to continue and conclude its general discussion on follow-up to and implementation of the outcome of the 2002 International Conference on Financing for Development and the 2008 Review Conference.  See Press Release GA/EF/3344 of 22 October for more information.


In the afternoon, Committee members were expected to take up macroeconomic policy questions, on which they had several reports before them.


Among them was the report of the Secretary-General International trade and development (document A/67/184).  Dated 26 July 2012, it concludes that the recent slowdown in major growth poles in the developing world, as well as the eurozone crisis, persistent unemployment and rising inequality and polarization are clouding short-term trade prospects.  It also notes that longer-term challenges arose as the realities of the twenty-first century altered the way in which trade is conducted.  Pressing global challenges and non-trade concerns require development-focused, coherent and integrated responses, including in trade policy, the report says, emphasizing that while global value chains offer opportunities, they are not a panacea, while cautioning that long-standing trade issues should not be forgotten in the pursuit of inclusive development.


According to the report, the international trading system faces the important challenge of identifying the way forward in the Doha Round of trade negotiations and in enhancing its own relevance and effectiveness.  It concludes that persistent development challenges point to the continuing necessity of supporting efforts by developing countries to build productive capacities and employment.  There is a need to ensure that regional approaches complement multilateralism and that, together, they provide an enabling environment for inclusive and sustainable development.


Also before the Committee was a note by the Secretary-General drawing the General Assembly’s attention to the Report of the United Nations Conference on Trade and Development on its thirteenth session (document A/67/183), held in Doha, Qatar, from 21 to 26 April 2012.  The report is dated 25 July 2012.


The Committee also had before it the Report of the Trade and Development Board on its fifty-fourth executive session (document A/67/15 (Part I)) dated 12 April 2012.  It summarizes the proceedings in three plenary meetings held at the Palais des Nations in Geneva, on 28 and 29 November 2011.  The report contains the President’s summary, in which the Secretary-General expresses concern that least developed countries are still suffering in the aftermath of the global recession, and are likely to lose several years before returning to their pre-crisis growth path.


Also before the Committee was the second part of the Report of the Trade and Development Board on its twenty-fifth special session (document A/67/15 (Part II)) dated 31 May 2012.  It outlines every part of the session, held in Geneva from 19 to 26 March 2012.  The Report of the Trade and Development Board on its twenty-sixth special session (document A/67/15 (Part III)), dated 11 September 2012, it contains the agreed conclusions and review of management and administration of the United Nations Conference on Trade and Development (UNCTAD).  It also emphasizes the importance of strategic guidance and oversight by Member States over the work of the UNCTAD Secretariat through the intergovernmental machinery, while the responsibility for effective day-to-day management and administration lies with the Secretariat.  Additionally, in elaborating the draft work plan, the UNCTAD Secretariat should ensure that the programmes and resources required for implementing the Doha Mandate will not be affected.


Dated 27 July 2012, the Secretary-General’s report on the International financial system and development (document A/67/187) complements his report on the follow-up to and implementation of the Monterrey Consensus and the Doha Declaration on Financing for Development (document A/67/339) of 29 August 2012.  It reviews recent trends in international official and private capital flows to developing countries, as well as current efforts to strengthen the international financial architecture.  It also highlights ongoing challenges arising from the world financial and economic crisis and its aftermath, particularly in the key areas of financial regulation, multilateral surveillance, policy coordination, sovereign debt, the global financial safety net, the management of capital flows, and governance reform at the Bretton Woods institutions.


The Secretary-General’s report External debt sustainability and development (document A/67/174), dated 24 July 2012, reviews recent developments relating to the external debt of developing countries, with a special focus on the role of credit rating agencies and problems relating to the design of mechanisms for dealing with sovereign debt restructuring.  It concludes that while costly crises are sometimes driven by exogenous shocks, they may also be caused by irresponsible behaviour on the part of both lenders and borrowers.  Prudent behaviour can thus limit the cost and prevalence of debt crises.


With that objective in mind, the report states that the UNCTAD Secretariat has developed a set of principles on responsible sovereign lending and borrowing which have gained support from a growing number of developing and developed countries.  Concluding that credit rating agencies remain crucial players in the international financial architecture, the report recommends, however, that the rating industry needs reform in order to limit conflicts of interest and the potentially disruptive effects of rating actions.


Statements


ZAHEER A. JANJUA, Director-General, Ministry of Foreign Affairs of Pakistan, associated himself with the Group of 77 and China.  Pointing to progress on the Monterrey Consensus but also to significant implementation gaps, he said the uncertain global economic situation had made development challenges more serious and complex than those prevailing when both the Monterrey Consensus and the Doha Declaration had come into existence.  That had complicated deliberations on follow-up, he said.  The United Nations Conference on Sustainable Development (Rio+20) outcome document contained an agreement to establish an intergovernmental process to assess financing needs, consider the effectiveness, consistency and synergies of existing instruments and frameworks, and evaluate additional initiatives.  Moving forward, the challenge would remain ensuring implementation of the Monterrey Consensus and the Doha Declaration while advancing parallel discussions on the agreements reached at Rio+20 on financing for sustainable development.  It was important to consider how the Monterrey Consensus could benefit any future strategies and integrate discussions under different processes on elaborating the sustainable development goals and shaping the post-2015 development agenda, he said.  In addition, there was a need for an institutional mechanism to monitor and follow up on the implementation of agreed strategies for mobilizing development finance.


YANERIT MORGAN ( Mexico) said the Monterrey Consensus brought together all relevant development actors in agreement on the financial sources that would best ensure the achievement of internationally agreed development targets.  It was essential to monitor the implementation of commitments made in Monterrey through a strengthened platform for dialogue and other options discussed in the Secretary-General’s report.  That strengthening should be part of a broader strengthening of the United Nations system for development, including the Economic and Social Council, she said, adding that the latter should be made better able to contribute and follow up on the new comprehensive development agenda.  Underlining the importance of having a single development agenda, she said all its key elements should be linked coherently together.  She also stressed the need to avoid duplication, while describing the Monterrey Consensus and its monitoring platform as the potential road map to the linking of all development goals.


RODNEY CHARLES (Trinidad and Tobago), associating himself with the Group of 77, the Community of Latin American and Caribbean States and the Caribbean Community (CARICOM), said the current volatile global financial and economic environment called for a serious commitment to mobilize resources for the provision of the necessary financial and technical support to developing countries.  Official development assistance (ODA) commitments must be honoured and innovative forms of financing, including public-private partnerships, must be leveraged to complement — but not replace — traditional sources of development assistance.


Describing middle-income countries as a “driving and stabilizing force” in the global economy, he said any regression in their economies, which had already occurred in the CARICOM subregion, would likely be detrimental to all.  The Government of Trinidad and Tobago had begun harnessing the financial and operational efficiencies of the private sector through private-public partnerships, he said, adding that he expected them to stimulate productivity, create employment and satisfy the infrastructural needs of the population, particularly those living in rural areas.  He called for enhancing the financing for development follow-up process in order to improve efforts to mobilize resources through traditional as well as non-traditional means.


MILAGROS MIRANDA ( Peru) said it was essential that all United Nations efforts converge in elaborating a single development agenda in order to ensure coherence and avoid a tendency towards fragmentation.  Regarding the financing of development, she said it was linked to debates on the post-2015 agenda, the integration of the three pillars of sustainable development and the role of the Economic and Social Council.  Welcoming the adoption by the Group of 20 (G20) Summit in Los Cabos, Mexico, of an action plan for growth and employment earlier this year, she expressed regret nonetheless over the lack of political will to eliminate protectionist measures that had a negative impact on trade and growth.  Their complete elimination would make a significant contribution to the Doha trade negotiations, she suggested.


LAMOUSSA KOUDOUGOU ( Burkina Faso) said the issue of innovative financial mechanisms introduced at Monterrey 10 years ago had a major place in the current international agenda on financing for development.  The international financial crisis had alerted the community of stakeholders to the clear limits of ODA, which was the first and only source of financing for many developing countries.  However, it was inefficient in rolling back poverty and effectively combating climate change, remained volatile and unpredictable, and was highly influenced by the political and economic environment in developed countries.  Private financial flows were attractive in developed countries, but could not meet the needs of the poorest States, he said, adding that funding from ODA and foreign direct investment (FDI) had been shown to lack the ability to meet development needs relating to health, education and the environment.


However, innovative financing mechanisms were considerably effective, he said, pointing out that in the last four years, the Government of Burkina Faso had raised $4 billion just for the health sector.  It was important to maximize such efforts and put them towards the transport, energy and finance sectors.  In the area of health, Burkina Faso benefitted from the GAVI Alliance, which had enabled the Government to implement programmes of vaccination and AIDS response.  In the health sector, private partnerships had contributed to primary, secondary and university education, thanks to private-public partnerships.  To maintain that trend, the Government held a yearly meeting with the private sector as well as non-governmental organizations, he said, pledging his country’s participation in the continuing quest to develop innovative financing on the national level.


ALAIN WILFRIED BIYA (Cameroon), associating himself with the Group of 77 and China, said history showed the importance of political will in development, and as such, developed countries should undertake all efforts to fulfil their commitments to aid the efforts of developing countries.  Thanking countries that had maintained their ODA commitments despite the financial crisis, he called on others to follow suit, citing Africa’s progress on good governance, the rule of law and the mobilization of national funds for development, while stressing also that resources remained insufficient.  As well as ODA levels, other funding sources had fallen, he said, pointing out that FDI had declined by 9 per cent in 2010.


Africa was not receiving sufficient funds on the global scale, he continued, noting that the weak development financing situation had led his country to formulate its Partnership Strategy for Development.  It took stock of and evaluated the Paris Pact, providing a framework for analysis to ensure the efficient management of external funds for national development purposes.  It had led to improvements in Cameroon’s national trade capabilities, with the enhancement and modernization of infrastructure such as ports, and the provision of better transit, merchandise and humanitarian assistance for landlocked neighbouring countries.  He also described the Strategy Document for Growth and Employment, saying it aimed to strengthen financial institutions, especially for those without formal access, including low-income individuals and small and medium-sized enterprises.


MODEST J. MERO (United Republic of Tanzania), associating himself with the Group of 77 and the Group of Least Developed Countries, said that if the global economy continued to slow down indefinitely, all efforts to fight poverty and achieve the Millennium Development Goals would be compromised.  He said he was concerned about the energy crisis, particularly fuel prices, imbalances in the world economy, rising protectionism in trade, environmental degradation and the adverse impact of climate change.  There was a need for a combination of policy options to address the challenges from the economic, social and environmental perspectives since the challenges were mutually reinforcing and could exacerbate poverty levels.


The United Republic of Tanzania had taken various measures to implement its international obligations by formulating and implementing policies and programmes as well as instituting regulatory regimes, he said.  The National Vision 2025 for mainland Tanzania and Vision 2020 for Zanzibar — both adopted before the Monterrey Consensus — aimed to improved livelihoods and good governance and to ensure a well-educated society.  Despite unfulfilled promises to developing countries, the international community must adopt a positive attitude towards development financing because development in Africa would stimulate demand and promote the exchange of goods, services and factors of production.  He also stressed the crucial role of science and technology in the quest to achieve the Millennium Development Goals as well as other internationally agreed targets, urging the diffusion of appropriate technology to expedite attainment of the Goals in developing countries.


MOHAMED CHERIF DIALLO (Guinea), associating himself with the Group of 77 and the Group of Least Developed Countries, said he was concerned that ODA had fallen in 2011, stressing that the Government of Guinea was making every effort to mobilize national resources, including by promoting innovative financing.  Efforts to recover funds were encouraging but insufficient.  Government revenues had risen following the implementation of major measures adopted by the Government.  However, innovative ways to seek out stable and supportive additional resources must be explored to help Guinea’s economic recovery, he said, suggesting a tax on flights and increasing the tax on remittances.  Medium- and long-term economic reforms should have positive outcomes, he said, adding that the new impetus to bolster Guinea’s position aimed to restore the State’s credibility at the national level and its image on the international stage.  However, achieving that would be only the first step on the path of progress to the country’s sustainable development, he said.


ESNART MPOKOSA (Zambia), associating herself with the Group of 77, the Group of Least Developed Countries and the Group of Landlocked Developing Countries, said Monterrey provided useful means to achieve growth, but stressed the need to create an enabling domestic environment.  FDI remained low and the little that came in was often based on credit rather than equity, leading to business uncertainty rather than confidence.  Zambia had worked to improve the way in which it harmonized resources from development partners with its development agenda, she said, though she emphasized the importance of cooperation, with partners honouring their ODA commitments.  Zambia had worked hard to mobilize its own resources, making a priority of broadening the tax base, and the private sector was important in boosting growth, she said, outlining the steps taken by the Government in limiting borrowing to stimulate better private sector-led growth.  That had resulted in increased domestic-led investments due to better liquidity, and would help to ensure that Zambia achieved its goal of becoming a prosperous middle-income country by 2030.


IDRIS ISMAIL FARAGALLA HASSAN ( Sudan) associated himself with the Group of 77 and the Group of Least Developed Countries, saying that development financing was of the highest priority to a least developed country emerging from crisis, like his own.  It was expected that financing, and investing in agriculture, in particular, would equip Sudan to contribute to the world market, but sanctions had prevented it from achieving sustainable development.  Requesting financial and technological assistance to help his country achieve the Millennium Development Goals, he also asked the international community to help finance its development following its cession of South Sudan, which had deprived Sudan of 90 per cent of its oil revenues.


He called for reform of the Bretton Woods institutions as well as the World Trade Organization, in order to make them more just and fair to least developed countries.  Calling for concerted efforts to establish a new international order aimed at ensuring fairness, he said that Sudan, as a country emerging from conflict, knew first-hand the importance of peace.  Sudan called for a greater role for developing countries in the governance of financial institutions, and requested development partners to honour their commitments to developing countries and those in post-conflict situations with a view to helping relieve their debt and contributing to their GDP so they could achieve sustainable development.


VÍCTOR LAUTARO OVALLES SANTOS ( Venezuela) associated himself with the Group of 77 and the Community of Latin American and Caribbean States, stressing the need for appropriate follow-up mechanisms to bridge the gap between policymaking and implementation.  In particular, Venezuela supported the establishment of a financing for development commission as a subsidiary of the Economic and Social Council.  Calling on Member States to strengthen the financing for development process and enhance the international trading system, he said much more work was needed to ensure implementation of financing for development commitments.  The United Nations needed to strengthen its role in supporting implementation of the Monterrey Consensus and the Doha Declaration, he said, adding that fair, equitable and development-oriented debt restructuring was required to help developing countries mobilize financial resources for liquidity and financing purposes.


Introduction of Reports


Having concluded its general discussion on follow-up to and implementation of the outcome of the 2002 International Conference on Financing for Development and the 2008 Review Conference, Committee members took up macroeconomic policy questions, hearing the introduction of three reports for their consideration.


GUILLERMO VALLES, Director, Division on International Trade in Goods and Services and Commodities, United Nations Conference on Trade and Development (UNCTAD), introduced the Secretary-General’s report on International Trade and Development (A/67/184), saying that after a marked slowdown in global economic growth during 2011, it was particularly worrisome that developing economies were increasingly witnessing deceleration.  For instance, growth was forecast to slow in China and India, which posed a great risk to the global economy, he added.


He went on to note that the sovereign debt crisis in the eurozone had not shown much sign of dissipating.  Since Europe was among the major export destinations and major sources of financial flows and tourism, the escalation of the crisis could significantly affect many developing countries, he cautioned.  Regarding trade, he called for vigilance against rising protectionism, though it was important to distinguish between that and the use of legitimate policy measures to promote industrial development and employment.


JÜRI SEILENTHAL, President, UNCTAD, introduced the reports of the Trade and Development Board, noting that the fifty-ninth session of UNCTAD had taken place in September against a backdrop of persistent threats to a sustained recovery, the ongoing fragility of the world economy, rising income inequality, widespread unemployment, rapid technological change, environmental challenges, financial crisis and deadlock in the World Trade Organization multilateral negotiations in Doha.  After “immense” efforts by all parties, consensus had been reached through political involvement as well as the commitment of many individuals, including many Ministers and other high-level officials.


Turning to UNCTAD XIII, he said that the Doha Manar, which had emerged from that Meeting, was significant as the political declaration in which members had agreed that development-centred globalization was their common cause.  The Doha Mandate reaffirmed UNCTAD’s role, as set out in the 2008 Accra Accord, adjusted the work of its secretariat and provided new guidelines in pursuing a model focused on development-centred globalization.  UCTAD XIII had been a victory for multilateralism, showing that despite deep divisions over policy, Member States could come together to find an agreement and identify cooperative solutions.


With the successful conclusion of the Conference, real work had begun on the implementation of reaffirmed mandates, he said, adding that where relevant, new mandates, ideas and initiatives were highlighted on the road from Doha to UNCTAD XIV from 2012 to 2016.  The urgent need to restore in the world economy, but also to build a more inclusive and sustainable pattern of growth — as underlined by the growing social unrest in both developing and developed countries — lead the way for the Trade and Development Board to examine several policies and measures on how to achieve this in the current economic context.  This included the active use of fiscal and income policies to restart economic growth and address economic equality.


ALEXANDER TREPELKOV, Director, Financing for Development Office, Department of Economic and Social Affairs, introduced the Secretary-General’s report on the international financial system and development, noting that the external imbalances of the major economies had narrowed substantially during the world economic and financial crisis.  An important component of global economic imbalances was the unprecedented accumulation of foreign reserves by a number of developing-world central banks, in part as protection against future crises.


As a group, developing countries had made a net transfer of financial resources estimated at approximately $826.6 billion to developed countries in 2011, he said, noting that the increasing volatility and vulnerability of international private capital flows due to changing investor sentiment had had a destabilizing impact on developing economies.  Developed-world sovereign debt, particularly in the eurozone, remained a source of instability, and policy interventions at the national and regional levels had seen mixed results, he said.


YUEFEN LI, Head of Debt and Development Finance Branch, UNCTAD, introduced the Secretary-General’s report on external debt sustainability and development.  He said slowing global growth and demand had negative implications for the export revenues of developing countries.  The uncertainties associated with such looming global problems dampened investment, and the uncertain global economic outlook was likely to continue to affect aid budgets, thus raising concerns about the predictability of planned aid in the years to come.


ODA, excluding debt relief, had declined for the first time in more than a decade, reflecting the impact of the global recession on donor aid budgets, he said.  Developing countries were becoming increasingly vulnerable to external shocks, which could prove devastating should adverse events occur in major developed countries.  The debt indicators had not worsened, thanks to export and GDP growth in the same period, but the current and forecast deceleration of global growth was likely to have a negative impact on those ratios.


GEORGE TALBOT ( Guyana), Committee Chair, then gave members an opportunity to ask questions.


The representative of Syria pointed out that some reports ignored the “most important impediment to trade” around the world, which was imposing coercive measures against developing countries.  The Rio+20 outcome document pointed out the negative impact of such measures on the capacity of developing countries to achieve development, he said, asking how UNCTAD could reverse that negative practice, which harmed peoples lives and distorted trade.  Syria was concerned that mention of such coercive measures was absent in many reports, despite having been pointed out in the Rio+20 outcome document, he reiterated.


Mr. VALLES, in responding to those questions, said unilateral economic measures were a highly sensitive issue that had been raised by many countries in different forums.  It was up to Member States to decide on their effectiveness and legitimacy, and not for the UNCTAD Secretariat to take the lead, he said, adding that while he would continue to address issues of non-tariff measures, which encompassed all sorts of instruments and tools with different objectives, the more political ones were for United Nations political bodies to address.


The representative of Syria said the reports should point out how unilateral economic and trade measures hampered human rights, specifically the right to development.  That issue was closely connected to the Second Committee and other United Nations entities, and it was important that the report include obstacles that distorted foreign trade and impeded progress in developing countries.


Statements


HAMAD AL-KUWARI, Minister for Culture and Heritage of Qatar and President of UNCTAD XII, said the Meeting had helped provide a plan for the important role that UNCTAD would play in addressing global challenges over the next four years.  He stressed the need to improve global economic governance, saying it was vital to the success of the global economic agenda.  Current global economic governance reflected a world that no longer existed, and needed changing to allow the system to evolve and become more responsive to the modern world.  The meeting had also shown that the world was united against poverty, he said, calling for united action to ensure that world trade continued to flow in a more development-oriented way.


He said UNCTAD would contribute to the elaboration of the sustainable development goals and the post-2015 development agenda, including by articulating development goals that would address economic fundamentals, build productive capacities, expand trade horizons and invest in the future.  Action on all fronts must be properly directed within a new culture of multilateral economic relationships based on putting ethics at the centre of international economic decision-making, he emphasized.  The structures that would emerge in the next few years would need to be just and conducive to an interdisciplinary approach aimed at addressing the root causes of underdevelopment, he added.


MOURAD BENMEHIDI ( Algeria), speaking on behalf of the Group of 77 and China, said adverse imbalances in international trade were escalating the impacts of the global economic and financial crisis, especially for developing countries.  The turbulence was costly and disruptive, especially for least developed countries and African States, and threatened social development as well as achievement of the Millennium Development Goals, he said.  Describing international trade as a “vital tool” for long-term sustainable growth, he said developing countries should be spared protectionist barriers, agricultural subsidies, in particular.  He also emphasized the importance of a successful conclusion of the Doha Round of multilateral trade negotiations and called for the extension of trade-related technical assistance and capacity-building to developing countries.


Underlining that the outcome of its thirteenth session reaffirmed UNCTAD’s mandate as the focal point for the integrated treatment of trade and development, he said it was important to strengthen South-South trade, and noted the enhanced market access between developing countries.  He also welcomed the conclusion of the third round of the Global System of Trade Preferences with the adoption of the Sao Paulo Protocol.  He reaffirmed the importance of ODA as a catalyst for development, saying it was vital that developed countries meet and scale up their existing bilateral and multilateral aid commitments.  Recognizing the positive contribution of innovative financing mechanisms, he reiterated that they should disburse funding in line with the priorities of developing countries and not substitute, or in any way affect, the level of traditional financing.


Stressing the need to reform the Bretton Woods institutions, he urged the General Assembly to launch a process to ensure that the international financial and monetary system better reflected current realities while ensuring the full participation of developing countries in the decision-making and norm-setting processes of the Bretton Woods institutions.  He also called for debt relief, including cancellation, saying it was vital and reiterating the urgent need for the international community to examine options for an effective, equitable, durable, independent and development-oriented debt-restructuring and international debt-resolution mechanism.  It was also important to take into account the multiple dimensions of debt sustainability and its impact on achieving the Millennium Development Goals.  Noting the contribution of International Monetary Fund (IMF) special drawing rights to increasing global liquidity, he encouraged continuing discussions on policy options to promote the long-term stability and proper functioning of the international monetary system.


RAYMOND WOLFE (Jamaica), speaking on behalf of CARICOM and associating himself with the Group of 77 and China, said the fragility and vulnerability of small island economies had been exacerbated by significant declines in earnings from tourism and remittances, combined with the steep decline in commodity prices, rising energy prices and growing unemployment.  They had all been compounded by the declining availability of financial resources for development, which was having a particularly negative effect on the ability of CARICOM States to achieve the Millennium Development Goals.


The global economic crises underscored the importance of a transparent, inclusive and well-coordinated system of global economic governance, he said, emphasizing that the Bretton Woods institutions required reform.  He welcomed steps to improve their governance structures, including the World Bank’s decision to increase the voting power of developing and transitional countries, and the doubling of IMF quotas, which had increased their share of quotas by 6 per cent and gave emerging economies two additional seats on the executive board.  However, ratification was essential, he said, calling on IMF member States, particularly the major shareholders, to ratify the reforms agreed in good faith.


He went on to stress the importance of debt alleviation for the small CARICOM economies, several of which were among the world’s most highly indebted.  That curtailed Governments’ fiscal space and development policies.  Many States in the region were also middle-income countries, a designation that limited access to concessionary financing and debt alleviation, he noted.  Graduating to middle-income status was “a double-edged sword” that indicated progress but also masked the grave challenges, including high debt-to-GDP ratios.  A more systemic approach was needed to provide middle-income countries with the necessary fiscal space to address the development needs of the most vulnerable.  He welcomed the outcome of UNCTAD XIII, but called for a development-oriented conclusion to the Doha negotiations.


ABDUL SHUKOR BIN P.A. MOHD SULTAN, Member of Parliament from Malaysia, spoke on behalf of the Association of Southeast Asian Nations (ASEAN) and associated himself with the Group of 77 and China.  Describing the bloc’s economic performance since 2008 as resilient and characterized by growth fuelled by exports as well as domestic demand, he said its economy had grown by 7.5 per cent in 2010, 4.5 per cent in 2011 and was expected to grow by between 5.6 per cent and 6.3 per cent this year.  ASEAN had long recognized the need for stronger regional coordination, cooperation and surveillance.  It had therefore established regional macroeconomic surveillance mechanisms, and deepened its discussions on policy management to include large capital flows and inflationary pressures in the region.


Citing the current global uncertainty, he stressed the importance of fiscal soundness for sustainable economic development.  He also reaffirmed ASEAN’s commitment to upholding a universal and equitable multilateral trading system, and warned countries against turning inward during economic difficulties.  The World Trade Organization and other relevant institutions should continue to monitor protectionist policies and assess their impact on developing countries, he said, adding that developed countries, likewise, should exercise the necessary flexibility and political will to break the impasse in the Doha negotiations.


Warning that the global downturn could further aggravate poverty and threaten achievement of the Millennium Development Goals by 2015, he said that by that same year, ASEAN aimed to realize a single market and production base, which would include the progressive liberalization of the financial services sector and the integration of capital markets.  Additionally, the bloc’s strong emphasis on economic integration would boost regional trade and investment.  In closing, he stressed the importance of strengthening global economic governance, including by enhancing the role of the United Nations, macroeconomic dialogue and coordination, as well as regional and global financial cooperation.


JEAN-FRANCIS RÉGIS ZINSOU (Benin), speaking on behalf of the Group of Least Developed Countries, said despite the international consensus around the imperative of ensuring that globalization was development-centred, the international trading system stood at a crossroads because the Doha negotiations remained at an impasse.  In particular, least developed countries were deeply concerned that the specific package related to their situation — including duty- and quota-free market access in the rules of origin, specific outcomes for trade-related aspects of cotton, a service waiver and accessions — had not materialized.


As agreed in the Istanbul Programme of Action, development partners should help least developed countries strengthen their human, institutional and regulatory capacities in trade policy and trade negotiation; enhance their productivity, competitiveness and diversification; and meet their implementation obligations.  The Group of Least Developed Countries therefore called upon Member States to ensure the timely implementation of duty- and quota-free market access on a lasting basis, resist protectionist tendencies and rectify trade-disorienting measures, including in agriculture, that were inconsistent with multilateral obligations.


He called on Member States to address non-tariff measures and eliminate arbitrary or non-justified trade barriers; to facilitate and accelerate negotiations with acceding least developed countries; and to define and agree on the details of a monitoring procedure for duty- and quota-free market access and rules of origin.  Among other things, the Group of Least Developed Countries also called upon development partners significantly to increase the share of assistance granted through “Aid for Trade”, and to help strengthen the capacity of least developed countries to access available resources, in support of the needs and demands expressed in their national development strategies.


AMERICO BEVIGLIA ZAMPETTI, European Union delegation, called for “targeted and coordinated actions” in support of the world’s poorest and most vulnerable, saying the bloc remained the largest provider of ODA and would renew efforts supporting achievement of the Millennium Development Goals, a successful post-2015 development framework and successful follow-up to the Rio+20 Conference.  In all areas, the focus would be on policy coherence and consistency, he said, stressing that the post-2015 development agenda and implementation of the Rio+20 outcome should be consistent with the existing financing for development framework.


Describing trade, the international financial system and external debt issues as intertwined with financing for development, he said they were best addressed under the “umbrella” of the Monterrey Consensus.  The European Union continued its support for efforts to strengthen the multilateral trading system in a rules-based, open and equitable way, including an ambitious and comprehensive resolution of the Doha Round, he said, adding that the bloc was active in helping developing countries harness the potential of trade through the Generalised System of Preferences.  Contributions to Aid for Trade and the conclusion of economic partnership agreements also helped to better integrate trade and development policy, he said, welcoming the ambition of the Los Cabos Growth and Jobs Action Plan.


Rio+20 reaffirmed the importance of poverty eradication and establishing sustainable consumption and production patterns, he said, welcoming Mexico’s leadership in adding inclusive green growth to the G20 development agenda.  He also welcomed recent decisions to strengthen the regulation, supervision and monitoring of the international financial system, citing the IMF reforms involving quotas and rebalanced representation and calling for their rapid ratification.  The European Union continued to support debt-relief initiatives including the Multilateral Debt Relief Initiative, the Debt Sustainability Framework and, in particular the Heavily Indebted Poor Countries (HIPC) initiative, calling on countries that had benefited from them to ensure that their debt remained at a sustainable level.


BARRY HAASE, Member of Parliament from Australia, spoke on behalf of the Cairns Group of 19 agricultural exporting countries, and described agricultural trade reform as unfinished business.  At the Group’s last ministerial meeting in 2011, participants had discussed the international trade policy environment, their shared desire to continue efforts towards agricultural trade policy reform and the development dimension of agriculture reform and food security.  Encouraging Member States to engage constructively on agricultural issues in order to advance the Doha negotiation process, he said the guidance from trade ministers attending the World Trade Organization’s Eighth Ministerial Conference in Geneva was clear:  they remained committed to a successful multilateral conclusion of the Doha Development Agenda and recognized that they must fully explore different negotiating approaches in order to achieve that end.


He said a meaningful re-engagement in agriculture was critical to development and to addressing global imbalances and distortions in world agricultural trade, whether they related to market access, domestic support or export subsidies.  Further, it was important to address those distortions not only in order to create further market efficiencies and more effective price signals for farmers and investors in agriculture, but also to contribute to greater food security.  The Food and Agriculture Organization of the United Nations (FAO) estimated that the global population would increase to 9 billion by 2050 and, consequently, agricultural production would need to rise by 70 per cent, he pointed out.  Trade would play a critical role in addressing the nutritional needs of those populations, because growth in food production in order to meet that demand would not necessarily be in areas where the population was projected to grow.


GILLES RIVARD (Canada), speaking also on behalf of Australia and New Zealand, said the Monterrey Consensus and Doha Declaration should continue to guide collective efforts to eradicate poverty and achieve sustainable growth and development.  The next steps in the follow-up process would depend on the outcomes of the Rio+20 follow-up on sustainable development financing, and on efforts to formulate a post-2015 development agenda.  National ownership and good governance were fundamental, with collective success in reducing poverty measured by the extent to which people could generate their own incomes.  That required strong public and private sector engagement, he said, noting that the public sector could foster the broader economic conditions for market-driven growth, while leveraging private sector resources and know-how to help create secure well-paying jobs.  It was important to find innovative ways to use public sector financing to leverage private capital, he added.


The development landscape was changing because of the profusion of new actors operating in international development financing, he said.  Acknowledging constraints on ODA, he said it was important to consider efforts to improve the effectiveness of international development assistance flows, and expressed support for the Busan Partnership for Effective Development Cooperation, which elaborated shared principles, common goals and differential commitments for effective international development.  Committed to moving the Doha Development Round negotiations forward from the current “impasse”, Canada, Australia and New Zealand recognized that improvements in market access must be complemented by strengthened aid for trade measures to address the supply-side constraints faced by developing countries.  It was important to stand firm against protectionism, he said, stressing the importance of free and open trade and expressing concern that the global trade-monitoring reports of the World Trade Organization demonstrated increased protectionism around the world.


DAOVY VONGXAY (Lao People’s Democratic Republic), associating himself with the Group of 77 and China, emphasized that improving the international economic environment, unlocking international trade negotiations and ensuring a fair, balanced and rules-based economic framework were the keys to promoting inclusive and equitable economic growth and sustainable development.  He highlighted the specific challenges facing landlocked developing countries, saying they were the most disadvantaged in their respective regions.  They had seen some progress in trade performance and thanks to promotion by the Group of 77 and China, their merchandise exports had increased from $33 billion to $158 billion between 2003 and 2010.


Aid-for-Trade measures, support from partners and implementation of the Almaty Programme of Action had brought about other improvements, he said, citing among them the removal of some trade barriers; enhanced capacity to mainstream trade within sectoral, national and regional, policies; improved transport and communications infrastructure with transit neighbours; and simplified border procedures, reduced transit time and documentation requirements.  Yet much remained to be done in areas including export diversification, improving production capacity and climate change mitigation, he said.  Stagnation in the Doha Development Round as well as protectionism also impeded the growth potential of landlocked developing countries.  Finally, he emphasized the importance of universal membership in the World Trade Organization, and said the disadvantages faced by landlocked developing countries should be taken into account when considering their accession to that agency.


IRINA A. MEDVEDEVA ( Russian Federation) said her country had finally begun its full-fledged membership at the World Trade Organization, which meant reduced barriers as well as access to banking insurance, telecommunication and other products.  That would be a general improvement in the Russian Federation’s business environment, she said, calling on the international community to improve protection of the rights of entrepreneurs.  The Russian Federation looked forward to making a contribution to a fair and balanced trading system.  The Russian Federation was providing its partners with trading opportunities while simplifying trade.


Welcoming the outcome of UNCTAD XIII, and its research on global trade, she said the Russian Federation was continuing to working actively to enhance its national economic models with the view to improving the global financial architecture.  It wished to provide foreign investors with a path to investing in the country, she said, assuring that its new laws would be in line with international standards.  The Russian Federation’s establishment as an international financial centre would ensure greater growth in the region and greater international stability, she said, adding that her country was moving to write off debt amounting to $20 billion in Africa alone.  However, that would only be effective if national policies improved the corporate, banking and other sectors in which the State had a vested interest.


LEE DONG LEE ( Republic of Korea) said “the importance of promoting trade and foreign direct investment in developing countries cannot be overemphasized”, as it contributed to a “virtuous circle of economic development”.  FDI was also critical to promoting ownership within developing countries, which was reflected in the emerging economies of East Asia.  In that regard, Aid for Trade should be one of the key elements during preparation of the post-2015 development agenda, he said.  In addition, it was important to help the capacity of developing countries catch up with a rapidly changing trade environment, and to explore the potential of a green economy, which, in turn, could open new markets and generate employment with trade opportunities for all.


Protectionism was destructive to all countries, including those with protectionist policies, he said, adding: “Global financial difficulties should not be an excuse for trade protectionism.”   He called for standstill and rollback measures affecting trade and investment until 2014.  Further, transparency and proper regulation of markets were essential to maintaining a stable supply of commodities.  Recent food-price volatility had exacerbated the difficulties confronting global economic recovery.  While some developing countries had benefitted from the rise in commodity prices, most had experienced its negative impacts, he said.  A more coordinated and active response was needed from the global community.


ELMAHDI S. ELMAJERBI ( Libya), associating himself with the Group of 77 and China, said it was important to overcome the stagnation in the Doha Round and to promote trade on the basis of non-discrimination and openness.  It was essential to ensure preferential treatment for developing countries and the removal of trade barriers.  Market fluctuations should be studied and investment in commodities increased, he said, adding that the multilateral trading system should promote growth and development.  He underscored the importance of trade in development, given the need for new processes to bring poorer countries out of poverty by promoting their agricultural sectors and strengthening their independence through technical assistance.


The international community needed ensure that reforms overcame the shortcomings of the international financial system and monitoring mechanisms, he said, adding that many least developed countries needed debt reduction because they were overburdened with the worst effects of the global economic and financial crisis.  The Paris Club had not taken the efforts of developing countries into account, he said, calling on the international community to establish more tolerable debt levels, ensure the necessary institutional reforms and enhance the voice and representation of developing countries in the international financial institutions.  Libya supported consolidated initiatives on debt relief, particularly the HIPC initiative, he said.


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For information media • not an official record