Statement by Mr. José Antonio Ocampo, Under-Secretary-General for Economic and Social Affairs to the Latin America and the Caribbean Regional Consulations on the ECOSOC Annual Ministerial Review
Brasilia, 18 May 2007

(Delivered by Mr. Nikhil Seth, Director, Office of ECOSOC Support and Coordination, UN Department of Economic and Social Affairs)

Distinguished Representatives,
Ladies and Gentlemen:

I would like to convey my deepest gratitude to the Government of Brazil for holding these first-ever regional consultations on the Economic and Social Council’s Annual Ministerial Reviews of progress towards the internationally agreed development goals. I would also like to thank the UN Economic Commission for Latin America and the Caribbean, for cooperating with UN DESA in supporting the organization of this meeting.

Eradicating extreme poverty and hunger is one of the greatest challenges of our times, and the UN global Conferences and Summits since the 1990s have put the commitment to addressing this challenge at the centre of national and international development efforts.

Since then, progress has been made in reducing poverty worldwide—all major regions except sub-Saharan Africa are now expected to reach the target of halving the proportion of the population living in extreme poverty between 1990 and 2015. But this global picture masks important regional and sub-regional disparities. Here in Latin America and the Caribbean countries are, overall, on track to meet the targets set for Millennium Development Goal One, having reduced extreme poverty, on average, to below 15 per cent of the population last year, that is, nearly 8 percentage points less than the levels of the 1990s.

There have been more limited strides, however, in the fight against hunger and malnutrition. Despite having the ability to produce enough food to feed the entire population, as well as the knowledge to improve nutrition, the organizational capacity to fight hunger and malnutrition has lagged far behind, and behavioural patterns have made progress even more difficult. An important concern for our region is that the countries with the highest rates of undernourishment and extreme poverty are also the ones that will continue to post the highest rates of population growth in the coming decade.

Ladies and gentlemen,

What are the key challenges facing Latin America and the Caribbean region in the realization of these Goals?

First, we see stubborn income inequalities, most evident between skilled and unskilled workers. Many countries also show growing regional or urban-rural inequalities. And we have seen only slow progress in closing the gender gap in employment, wages, and working conditions.

In this regard, employment generation and decent work, especially for women and youth, must become a higher national policy priority—and, indeed, a central objective of macroeconomic policies. Policies that support investment, growth, and entrepreneurship are also essential to the creation of new job opportunities. Making further progress in poverty reduction will also require mainstreaming equity across public sector policies to enable the poor to access opportunities, assets, incomes, and social services.

The relationship between economic growth and social equity is critical for any successful development experience. Unfortunately, we see too many examples of countries in the region in which this link has worked inadequately. No universal model exists. Yet, targeted distributional policies and strengthened capacity of the public sector in addressing this link seem to work towards the overall objective of promoting equity and fairness in a society. The Brazilian experience with Bolsa Familia is a remarkable example in this regard.

Second, in a world characterized by massive and highly pro-cyclical capital movements, we have no guarantee against a repetition of the crises that hit Latin America in the 1980s and in the second half of the 1990s. But steps can be taken to reduce the risks from abrupt capital movements and contagion from crises. They include not only consolidating good macroeconomic management but also securing adequate space for countercyclical macroeconomic policies. The development of deep domestic financial markets in local currencies is also one of the surest ways for countries to build greater autonomy for their economic policy.

Third, consolidating the productive transformation process and moving into more dynamic areas of specialization, with a higher technological content and greater value-added, are key to the long-term trade growth of middle-income countries. Progress on these fronts, however, is constrained by domestic capacities and by restrictions that may be imposed by the international trading system.

Fourth, while it is well-established that all countries bear primary responsibility for their own development, the global partnership for development, as set out in the Millennium Declaration and the Monterrey Consensus, is indispensable to achieve the development goals agreed by the international community. This partnership entails commitments by countries to sound policies, good governance, and the rule of law. It also calls for mobilizing domestic resources, attracting stable international capital flows to developing countries, and promoting international trade as an engine for development. It involves increased international financial and technical cooperation for development, sustainable debt financing, and external debt relief. And it includes enhanced coherence and consistency of the international monetary, financial, and trading systems.

There has been progress in several areas of the global partnership for development. Since Monterrey, the long-term decline in official development assistance (ODA) has been reversed—though with a temporary setback in 2006; we now have an agreed framework on aid effectiveness; a number of countries have benefited from debt relief; and both domestic and foreign direct investment have been increasing in developing countries.

There are, however, growing concerns, particularly among developing countries, that this partnership has not yet lived up to expectations. This is evident indeed in some critical areas, particularly trade, the participation of developing countries in international economic decision-making, in reducing the vulnerability of developing countries to financial market volatility, and in guaranteeing the stability of the international monetary system. This should be alarming to all governments as continued lack of progress in these key areas may well have a negative impact on cooperation in other important areas as well.

A fifth challenge is the level of attention given to the specific concerns of middle-income countries. In recent years, the international community has given strong attention, and correctly so, to the poorest countries of the world, particularly in sub-Saharan Africa. Yet, this should not preclude adequate attention to middle-income countries, where two-fifths of the world’s people who live on less than two dollars a day are located. These countries, with some justification, feel largely left out of the current system of international cooperation.

I believe this demands new thinking on the specific features of middle-income countries from the point of view of development cooperation. The conditions and rules under which countries integrate into the world economy in the areas of finance, trade, and technology are critical for middle-income countries. Thus, development-friendly rules in these areas are perhaps even more important than the ODA directed towards these countries, which is likely to continue to be limited. ODA is also less important than stable access to multilateral financing and, especially, to private financing. Yet, direct assistance can play a significant role, particularly if it catalyzes domestic efforts in key areas.

At the same time, just as developed countries are asked to cooperate with middle-income countries, the latter should increasingly serve as sources of cooperation, by playing a larger role in South-South cooperation, amongst themselves and with lower-income countries. In response to this demand, South-South cooperation is showing increasing vitality.

I understand you will be hearing more on some of these challenges from the experts in the two roundtable discussions.

Ladies and Gentlemen,

The challenges of development remain complex. Individual and piecemeal approaches are slow and inefficient. We need to join forces to banish the banes of poverty and hunger, and to avert the impending threats posed by climate change and other problems that know no borders. In this effort, the new functions of Economic and Social Council have the potential to provide a platform for strengthened accountability, greater cooperation, and political engagement.

I strongly believe that ECOSOC’s Annual Ministerial Reviews and Development Cooperation Forum can become the fulcrum for effective action at the national, regional, and global levels. This is particularly true of the Review, with its distinct features encompassing national voluntary presentations, regional consultations such as this one, and the global discussion to be held for the first time in July in Geneva.

The forthcoming session of ECOSOC has all the potential to become a path-breaking session, in terms of ensuring the implementation of commitments made in the area of development. ECOSOC will become the forum for strengthening the very foundations of the global partnership for development.

To ensure that the UN Development Agenda, including the MDGs, is implemented in a timely and effective manner, each one of us must give our full commitment to playing our respective roles.

There is much work to be done but also increasing signs that the broad strategy embodied in the Millennium Declaration, the Monterrey Consensus, the Johannesburg Plan of Implementation and the 2005 World Summit Outcome is yielding positive results. Hence, the present course of action must be not only maintained but accelerated.

I wish you all the best for a fruitful discussion and look forward to the outcome of your deliberations.