United Nations

A/51/152/Add.1


General Assembly

Distr. GENERAL  

7 October 1996

ORIGINAL:
ENGLISH


                                                              

General Assembly
Fifty-first session
Agenda item 94 (c)


            MACROECONOMIC POLICY QUESTIONS:  TRADE AND DEVELOPMENT

                         Note by the Secretary-General


     The Secretary-General has the honour to transmit to the members of
the General Assembly his comments on the report of the Joint
Inspection Unit entitled "United Nations Conference on Trade and
Development:  Review of institutional and programme issues"
(A/51/152).


                                     ANNEX

           Comments of the Secretary-General on the report of the Joint
           Inspection Unit entitled "United Nations Conference on Trade
           and Development:  Review of institutional and programme
                                    issues"


                               I.  INTRODUCTION

1.   As stated in its introduction, the purpose of the report prepared
by the Joint Inspection Unit is to review and assess the achievements
of the United Nations Conference on Trade and Development (UNCTAD) in
implementing its development mission, as prescribed by its mandate. 
The report reviews the institutional and programme framework of UNCTAD
and analyses its mission, role, mandate, functions and activities
within a new framework of international development cooperation.  The
Inspector refers to the current efforts to strengthen and revitalize
the role of the United Nations in the economic, social and related
fields as the overall context for the report.

2.   In analysing the factors that have guided the decision of the
Joint Inspection Unit to undertake this review, the Inspector points
to a number of trends and developments that have had a major effect on
UNCTAD's institutional evolution.  He refers, in this context, to
changes in the global economic setting, such as the increasing
transnationalization of the world economy; the growing linkages
between peace and security, on the one hand, and economic, social and
environmental issues, on the other; the emergence of trading blocks
and economic integration patterns in different parts of the world; and
the establishment of the World Trade Organization (WTO).  In the same
context, the author recalls the fundamental responsibilities entrusted
to UNCTAD by the international community for the development of
developing countries, and highlights the special needs of the least
developed, landlocked and island developing countries.  He also refers
to the particular requirements of countries making the transition to
market economies and those implementing macroeconomic reforms.  In the
circumstances, the Unit concluded that it was timely to assess the
extent to which UNCTAD was effectively addressing the differing
priorities of its constituency in the key areas of trade and
development, and in its integrated treatment of the development
aspects of trade, finance, investment, technology and services.

3.   The author notes that the report is based upon the views expressed
by delegations in the General Assembly and the Economic and Social
Council during 1994 and 1995, on the information received during his
contacts at United Nations Headquarters and in the UNCTAD secretariat,
as well as on an analysis of the results of reforms within the
secretariats of UNCTAD and the United Nations.  The Inspector
concludes that UNCTAD can be given credit for a long record of
tangible achievements since its creation in 1964.  At the same time,
the author identifies a number of challenges facing the institution,
stemming from the many problems that continue to bedevil the majority
of the developing countries, and more acutely the least developed,
landlocked and island developing countries, in the areas of trade and
development coming within the purview of UNCTAD.

4.   As one of the challenges to be tackled by the institution, the
Inspector singles out UNCTAD's lack of field visibility, which, in his
view, constrains its ability to fashion a field-oriented and
priority-driven technical cooperation strategy supportive of
developing countries.  He stresses the necessity for UNCTAD, in
partnership with other relevant entities within the United Nations
system, to intensify its technical cooperation activities by
promoting, inter alia, interregional information systems or networks
in trade, science and technology, investment flows, and commodity
markets.

5.   With regard to the current restructuring process, the Inspector
believes that further reform initiatives should aim to deepen - and
not broaden - UNCTAD's mandate and should seek to institute greater
synergies between the UNCTAD secretariat and other parts of the United
Nations Secretariat in addressing trade and development issues.

6.   The Inspector makes a number of recommendations aimed at
strengthening the role of UNCTAD in general, and its technical
cooperation function in particular, at building system-wide
partnerships for development and at developing and strengthening, in
that context, cooperation with WTO and the Bretton Woods institutions
in areas covered by UNCTAD's mandate.


                             II.  GENERAL COMMENTS

7.   At a time when, under the impulse of its ninth session, UNCTAD is
adopting far-reaching institutional reforms, and several reform
processes are under way in relation to the economic and social sectors
of the United Nations, the report provides useful and valuable
information of relevance for these discussions.  The report presents a
good overview of UNCTAD activities in the execution of its
institutional mandate and captures in a concise manner its major
achievements, highlighting its constant concern for reform and
adaptation to international developments.

8.   Also to be commended is the report's examination of the UNCTAD-WTO
relationship in the aftermath of the Uruguay Round of multilateral
trade negotiations, at a time when special attention is being given to
the respective roles of the two institutions.  Section A of chapter IV
provides a compelling analysis of the complementarity of functions
between the two institutions.

9.   The report credits UNCTAD for the reform processes it has
undergone, through intergovernmental agreement, encompassing policy
orientations, intergovernmental machinery and working methods.  The
outcome of the ninth session has significantly reinforced this
constant dimension of UNCTAD.  The final communique' of the Summit of
the seven major industrialized countries, held at Lyon in June 1996,
similarly highlighted the achievements of UNCTAD in reforming the
institution and held UNCTAD as a model of reform for other parts of
the United Nations.


                     III.  COMMENTS ON THE RECOMMENDATIONS

10.  Most of the recommendations set out in the report coincide with
actions already under way, particularly in the context of the
follow-up to the ninth session.

Recommendation 1.  Strengthening the role of UNCTAD

                   (a)  As part of the continuing restructuring process
                   throughout the United Nations, the Secretary-General
                   of the United Nations and the Secretary-General of
                   UNCTAD should further enhance cooperation between the
                   UNCTAD secretariat and the secretariats of the
                   regional commissions and other departments at United
                   Nations Headquarters in the economic and social
                   sectors.  Such improved collaboration should, among
                   other things, lead to the harmonization and
                   streamlining of related programmes of work within the
                   Secretariat, and should enable the secretariats of
                   the regional commissions and Headquarters entities to
                   contribute substantive inputs to the Trade and
                   Development Conference and Board, while the UNCTAD
                   secretariat could play a more active role in the
                   substantive servicing of the Second Committee and the
                   Economic and Social Council.

                   (b)  Further strengthening should concentrate on
                   UNCTAD's action-oriented research capacity of
                   relevance to the national level, and on working more
                   closely with the private sector and non-governmental
                   organizations.

11.  Considerable efforts have been made in recent years to enhance
policy and programme coherence among the various entities comprising
the economic and social sectors of the United Nations.  Progress in
this direction was one of the key objectives of the 1993
reorganization and of the redeployments of functions and activities
(including the integration in UNCTAD of activities of separate United
Nations centres dealing with transnational corporations and with
technology) that characterized that reorganization.  The
reorganization was accompanied by, inter alia, a review of the
functions and responsibilities of Headquarters departments and central
United Nations entities (including UNCTAD and the United Nations
Environment Programme (UNEP)) on the one hand, and the regional
commissions, on the other.  As part of that process, UNCTAD and the
regional commissions jointly arranged for an independent consultant
study to advise them on ways of maximizing complementarity in their
respective work programmes.

12.  Provision has consistently been made for the participation of
Headquarters departments and the regional commissions in the Trade and
Development Board and the Conference, and valuable contributions have
been made.  With respect to the role of the UNCTAD secretariat in the
substantive servicing of the Second Committee and the Economic and
Social Council, UNCTAD has traditionally provided, and continues to
provide, substantive support to these bodies in connection with the
items on their agenda dealing with trade and development and the least
developed and other special categories of countries, and contributes
to the preparations and discussions of a number of other items
concerned with development issues.  The General Assembly, in its
resolution 50/227 of 24 May 1996, has now called for greater use to be
made, in the Second Committee, of, among other reports, the Trade and
Development Report, and for the possibility to be explored of the
United Nations Secretariat, UNCTAD, the Bretton Woods institutions and
WTO preparing joint reports to better focus the policy dialogue at the
high-level segment of the Economic and Social Council.  The
Secretary-General intends actively to pursue the follow-up to these
provisions.

13.  In his report to the ninth session, the Secretary-General of
UNCTAD emphasized the need for UNCTAD to focus on action-oriented
research, and on activities that have a particular impact at the
national level.  He also stressed his determination to involve more
closely the private sector and non-governmental organizations in the
work of UNCTAD, and made specific recommendations with regard to the
mechanisms to be utilized for this purpose.  Governments have
recognized the value of these proposals, and many elements were
incorporated in the final documents of the ninth session, namely the
Midrand Declaration and A Partnership for Growth and Development.

Recommendation 2.  Building system-wide partnerships for development

                   (a)  UNCTAD should continue to expand the cooperation
                   arrangements and joint activities it has developed
                   with other parts of the United Nations system, such
                   as the Food and Agriculture Organization of the
                   United Nations, the United Nations Environment
                   Programme, the United Nations Industrial Development
                   Organization (UNIDO), the World Intellectual Property
                   Organization, the United Nations Educational,
                   Scientific and Cultural Organization and the
                   International Maritime Organization.

                   (b)  The above-mentioned organizations, as well as
                   the regional commissions and other Secretariat
                   entities, could be invited to participate in the
                   systematic building of interregional information
                   systems or networks in the fields of trade, science
                   and technology, commodities, and investment
                   promotion.

14.  As a matter of policy, UNCTAD has long had extensive cooperation
with those organizations of the United Nations system whose mandates
and activities lend themselves to joint or cooperative activities. 
Thus, UNCTAD has established joint programmes or agreements with UNEP,
the International Maritime Organization (IMO) and the United Nations
Industrial Development Organization (UNIDO), and has developed
excellent cooperation with the Food and Agriculture Organization of
the United Nations (FAO) on matters of mutual interest.  UNCTAD also
participates actively in inter-agency initiatives under the aegis of
the Administrative Committee on Coordination (ACC), such as the ACC
task forces engaged in the follow-up to global conferences and the
System-wide Special Initiative on Africa.  With respect to information
networks, UNCTAD, pursuant to the relevant recommendations of its
ninth session, will be assessing, in close cooperation with the
International Telecommunication Union (ITU), the practical trade
implications of the emerging Global Information Infrastructure (GII)
and identifying areas for action in this regard.

Recommendation 3.  Strengthening the technical cooperation function

                   In the context of ongoing efforts to restructure and
                   revitalize the United Nations in the economic, social
                   and related fields, and adapt the UNCTAD programme of
                   work to the evolving international setting,
                   consideration should be given to a significant
                   strengthening of the technical cooperation role of
                   UNCTAD in the principal areas of its responsibility. 
                   The UNCTAD secretariat should play a bigger role in
                   building interregional technological networks
                   involving other organizations of the system.

15.  In the final document of its ninth session, A Partnership for
Growth and Development (chap. II, sect. E) Governments recognized
UNCTAD's technical cooperation programme as an important element in
providing practical assistance to developing countries, especially
those with the greatest need, and committed themselves to
strengthening its effectiveness and impact as an essential complement
to the institution's policy-oriented analytical and deliberative work. 
In this light, the Trade and Development Board will continue its
annual review of the UNCTAD technical cooperation programme, including
the elaboration of an indicative, rolling three-year plan.

Recommendation 4.  Least developed, landlocked and island developing
countries

                   In its future programmes of work, UNCTAD should
                   continue to give due prominence to the unique
                   development needs of the least developed, landlocked
                   and island developing countries and should project
                   their concerns more systematically throughout the
                   UNCTAD secretariat and at the level of other
                   organizations within the United Nations system.

16.  UNCTAD has been designated by the General Assembly as the focal
point for activities relating to the least developed, landlocked and
island developing countries.  The Trade and Development Board annually
reviews the implementation of the Programme of Action for the Least
Developed Countries for the 1990s.  Similarly, UNCTAD prepares the
reports of the Secretary-General of the United Nations on the
landlocked and island developing countries for submission to the
General Assembly.  In the exercise of these responsibilities, UNCTAD
maintains close contact with other organizations of the system and
brings these matters up for discussion, whenever necessary, within ACC
and its subsidiary machinery.  In line with the Inspector's
recommendation, the recent reorganization of the UNCTAD secretariat
provides for the projection of these countries' concerns throughout
the UNCTAD programme of work and its secretariat, as the related
issues will be pursued and treated at both the sectoral and
cross-sectoral levels.  A Special Coordinator at the latter level will
monitor sectoral substantive work, and a Steering Committee, chaired
by the Secretary-General of UNCTAD, will provide oversight.

Recommendation 5.  Cooperation with WTO

                   The complementarity of functions between UNCTAD and
                   WTO appears quite clear.  Member States cannot but
                   benefit from such complementarity as well as from the
                   related synergies between the two institutions.  The
                   General Assembly has made specific recommendations in
                   this respect.  The recent steps taken to develop
                   UNCTAD-WTO cooperation at both the secretariat and
                   institutional levels should continue to be
                   encouraged.

17.  A number of recent initiatives are contributing to reinforcing and
systematizing cooperation between UNCTAD and WTO based on the
complementarities of their functions.  The two institutions hold
meetings every six months, chaired jointly by their executive heads,
to discuss issues of common concern.  Working relationships at all
levels are also being strengthened in such areas as research, trade
and investment, trade and competition, trade and the environment, and
trade and development.  In the context of the implementation of the
System-wide Special Initiative on Africa, the executive heads of
UNCTAD and WTO have elaborated a plan of action for increasing
Africa's export-oriented production and the improvement of export
diversification and markets.

Recommendation 6.  Cooperation with the Bretton Woods institutions

                   (a)  The General Assembly and the Economic and Social
                   Council could seek to strengthen consultations,
                   technical exchanges and reciprocal rights of
                   attendance at meetings between the multilateral
                   financial institutions, on the one hand, and United
                   Nations economic and social entities, especially
                   UNCTAD, on the other.  The current process of
                   restructuring and revitalization of the Organization
                   in the economic, social and related fields should
                   take this fully into account.

                   (b)  More frequent use could be made of the
                   provisions of existing relationship agreements
                   between the United Nations and the multilateral
                   financial institutions in order to enhance
                   cooperation and coordination on global development
                   priorities.  Both UNCTAD and the Bretton Woods
                   institutions could take advantage more often of these
                   instruments in the policy consultations.

18.  The relationship between the United Nations and the Bretton Woods
institutions is being given special attention in the context of the
current debate on an agenda for development and the restructuring of
the economic and social sectors of the United Nations.  The Bretton
Woods institutions have continued to contribute to the policy dialogue
at the high-level segments of the Economic and Social Council, and
participated actively in the ninth session of UNCTAD.

19.  At the secretariat level, close and frequent consultations are
being held between the Secretary-General of the United Nations and the
executive heads of the Bretton Woods institutions and WTO, and
collaboration is being substantially strengthened at the programme
level.  A document detailing some of the elements of this cooperation,
with emphasis on operational activities, was submitted to the Economic
and Social Council at its substantive session of 1996 (E/1996/72 and
Corr.1).  Policy interactions and programme cooperation are also being
expanded in the context of the arrangements made by ACC to promote the
integrated follow-up to recent United Nations global conferences (the
World Bank chairs the thematic ACC task force on the enabling
environment and participates actively, together with the International
Monetary Fund, in two other inter-agency task forces on basic social
services for all and on employment and sustainable livelihood), and of
the System-wide Special Initiative on Africa.

20.  These developments provide the setting for further enhancing
policy consultations and programme cooperation between the Bretton
Woods institutions and UNCTAD, drawing on the experience with the
consultative arrangements developed between WTO and UNCTAD.


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