Trade
United Nations, A/ AC. 257/ L. 2, June 2000
"Enhancing
trade for financing development
5. Enhancing trade for financing
development: ensuring market access for products of export interest to developing
countries; addressing issues related to the decline of public revenues from trade
liberalization; strengthening regional cooperation/ integration for expansion of global
trade; capacity-building and technical assistance, including assistance for trade
negotiations and dispute settlement; special needs of Africa, the least developed
countries, small island developing States, landlocked and transit developing countries and
other developing countries as well as countries with economies in transition with special
difficulties "
Full Text of Agenda
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United Nations, A/AC.254/24, March 2001
"Heading III: Trade
The expansion of international trade and integration into the
world economy are indispensable instruments for promoting long-term economic growth and
combating poverty. A central challenge is to ensure a stable, predictable,
non-discriminatory, transparent, fair and equitable multilateral trading system in support
of development, which contributes in a coherent manner to spread the benefits of trade to
all developing countries, ensuring rapid and sustained growth of incomes and exports to
finance their development goals.
Trade barriers and producer subsidies by developed countries
currently impose costs on developing countries that significantly exceed aid flows.
Lifting them would allow many more developing country products reach the markets of
developed countries. The lifting of conventional barriers should not be followed by the
introduction of new ones –even if these are in connection with commendable
objectives, such as to improve labor or environmental practices. Support for trade
liberalization and improvement of standards and safeguards must be separate and reinforce,
not undermine.
Trade liberalization in developing countries must be
well-tailored and phased in line with national economic and social objectives and be
complemented with greater diversification and a substantial expansion of national
productive capacities of developing countries, including through appropriate transfers of
technology and capacity building. Access to appropriate risk management mechanisms is also
an important objective.
How to support the enhancement of the development dimension of
multilateral trade agreements? How to ensure that any future WTO trade negotiations be
best linked to development goals? How to provide further political impetus to the work
taking place at the WTO and elsewhere to enhance the impact of trade on development?
How to deepen the political momentum building towards ensuring
full market access of LDC’s exports to the markets of all industrialized countries
and taking further positive steps in this direction for other developing countries? By
type of beneficiary country (SIDS, others)? By sector (e.g., focusing in the first
instance on textiles and clothing and on the reduction of barriers of trade in
agricultural products, in particular developed countries’ subsidies for agricultural
products)? By impact (e.g. focusing on the removal of tariff peaks or anti-dumping
measures affecting the export products of developing countries, expanding systems of
preferences)? By advancing simultaneously in all these fronts?
How best to enhance the contribution of regional and subregional
cooperation and integration as building blocks to foster global trade and development?
How to strengthen the contribution of the World Bank,
governments, donors and other financial and development institutions, both public and
private, in support of a diversified export capacity to benefit from trade? How best to
ensure fully-funded programmes to assist developing countries to remove supply-side
constrains and improve trade infrastructure?
How to strengthen the existing mechanisms of the international
financial institutions for compensatory balance of payments support in times of commodity
price shocks?
How can the relevant international organizations support
developing countries to gain access to risk management instruments in commodity markets
and cope with persistent terms of trade decline and commodity price instability?
How can the relevant international organizations contribute to
ensure access for developing countries, in particular vulnerable countries such as SIDS,
to insurance against natural catastrophes?
Which steps should be taken on a priority basis to match the
requirements of technical and financial assistance for capacity-building in this regard,
including in areas such as trade negotiations and dispute settlement as well as in support
of implementation capacities? How to support the Integrated Framework for LDCs and build
upon its experience for enhancing the coherence of trade capacity-building for other
developing countries?"
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Report
of the Secretary-General
to the Preparatory Committee for the
High-Level International Intergovernmental Event
on Financing For Development
United Nations, A/AC.257/12, January 2001
"Donor countries and international financial
and developmental institutions should pursue a global, fully-funded programme to assist
interested developing countries, particularly least developed countries and other
low-income countries, in liberalizing, as appropriate, the trade sector of their
economies, building the necessary policy, physical and human capacity to trade
competitively in goods and services, and ensuring that gradual trade liberalization is
part of, and consistent with, development and poverty reduction strategies.(...)
All trading partners should liberalize trade in
goods and services of particular interest to developing economies, seeking to achieve
bound, expanded and commercially meaningful market access for such goods and services.
Particular attention should be given, in the first instance, to the full integration of
textiles and clothing into WTO; the reduction of barriers of trade in agricultural
products; the removal of tariff peaks and escalation affecting the export products of
developing countries; and the expansion, where appropriate, of Generalized System of
Preferences (GSP) schemes.(...)
All developed countries should immediately provide
duty-free, quota-free market access to all non-arms exports of least developed countries
and highly indebted poor countries and consider doing the same for other developing
countries, particularly the countries of Africa, small island developing States,
landlocked and transit developing countries, and other developing countries, as well as
countries with economies in transition with special difficulties in attracting financing
for development.(...)
WTO members should ensure that the WTO agreements
and their associated disciplines are applied in ways conducive to development. Developed
country members of WTO and international financial institutions should ensure that
adequate financial and technical assistance is provided to developing countries for their
implementation of the WTO agreements. WTO members should also not use contingency measures
and restrictive rules of origin, and should ensure that standards, technical regulations
and Sanitary and Phytosanitary Standards (SPS) measures are not used to obstruct trade,
that they can be adequately observed by developing countries and that appropriate
assistance is provided to enable them to do so.(...)
The international financial institutions should
continue adapting and making more flexible the mechanisms through which they provide
balance of payments support in times of commodity price shocks.(...)
The relevant international organizations should
urgently formulate measures to help developing countries to deal with commodity price
risks, including the possible establishment of a new global facility to facilitate
developing country access to commodity price risk management and structured commodity
finance mechanisms and to assist in the development of regional and national commodity
exchanges.(...)
The multilateral development banks should spearhead
the development of a major programme to assist developing countries, particularly small
and vulnerable economies, in diversifying their export base in terms of both the product
mix (goods and services) and destination markets. The importance of export diversification
programmes should be kept in mind by bilateral donors and all multilateral aid agencies in
considering expenditure and assistance priorities. WTO should monitor vigilantly the use
of anti-dumping measures and any voluntary export restraint agreements, particularly when
used against developing countries.(...)
Donor countries should contribute rapidly and
generously to the Trust Fund established in the context of the Integrated Framework. WTO
members should expand the scope of the Integrated Framework beyond the least developed
countries, to cover other developing countries, particularly countries of Africa, small
island States and landlocked and transit developing countries."
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Joint Statement of the Co-Chairmen
at the Conclusion of the First Part of the
Third Session of the Preparatory Committee
United Nations, 8 May 2001
" III. Trade
The active discussion of international trade in the context of
financing for development that began at the Second Session of the Prep Com resumed in the
current session and involved many Member States, as well as a number of international
organizations and civil society representatives.There was a convergence of views that
trade can and should give an important boost to economic growth and employment, that it is
for most countries the central source of external resources for development, that global
trade liberalization can offer important development opportunities but also serious
economic challenges, and that countries differ greatly in their capacity to take advantage
of the opportunities and successfully meet the challenges. The international community
already acknowledges different country capacities by granting, to varying degrees, special
preferences, financial and technical assistance in trade-related matters to specific
groups of countries, in particular, Africa, least developed, small island developing
States and land-locked developing countries. In addition, today there is a greater
appreciation of the need for realistic appraisals of the appropriate sequencing and time
frame for implementation of trade policy commitments of developing countries. In this
regard, several countries reported how helpful it has been to them to liberalize trade
first within regional groupings.
The discussion underlined the inescapable linkage of trade and
development policy and the importance given that all countries should meet all of their
trade policy commitments, including understandings agreed as "best efforts".
Many speakers observed that, while they are ready to expand their exports, they do not yet
enjoy sufficient access to export markets even though many of their export products are
part of the "built-in agenda" of the WTO.
It was also emphasized that gaining increased market access is
only valuable to developing countries if they can increase production to supply those
markets. This is a development question, entailing investment in export capacity and
related infrastructure. It thus involves domestic and international financial systems, and
their public and private institutions. Moreover, liberalization of the trade regime of
developing countries sometimes embodies substantial adjustment costs, which, as noted by
the WTO membership in its paper for the Prep Com, may require appropriate international
support policies and compensatory measures (para 6). It was also observed that before
proposals for international trade policy changes are made, social and environmental impact
assessments should be undertaken at national level, as they typically are for large
investment projects. In addition, several speakers underlined the importance of stronger
policies to ameliorate the negative effects of terms-of-trade losses and commodity price
volatility.
Toward policy priorities
Linking international trade negotiations to development goals:
The liberalization and reform process, as noted by several speakers and as described in
the paper of the WTO membership, aims to improve market access in all sectors and
elaborate balanced and equitable rules for the conduct of international trade in goods and
services (para 9). The WTO membership described as fundamental the principles of
non-discrimination, predictability, transparency, equity and provisions for special and
differential treatment (para 7), a point echoed by speakers in the Prep Com. In addition,
speakers were concerned that the lifting of conventional trade barriers not be followed by
imposition of new ones, even if aimed at commendable objectives. The ILO noted that it was
seeking parallel progress on labour standards that should reinforce work on trade policy.
More generally, the WTO membership called for the mainstreaming of trade policies into the
wider framework of development and poverty reduction strategies (para 19). It was
suggested that FfD might focus on bottlenecks to development and how to resolve them so
that the benefits of trade liberalization would be fully realized. It was also observed
that adequate growth of global effective demand was necessary to translate improved trade
opportunities into increased trade itself, an issue with strong systemic aspects.
Developing appropriate arrangements for capacity building in
trade matters: Speakers in the Prep Com welcomed steps to strengthen the Integrated
Framework for technical assistance for least developed countries. It is important, not
only to boost the capacity of these countries to implement WTO agreements, but also to
raise their ability to participate in trade negotiations. Other developing countries also
have trade-related capacity-building needs. There is considerable interest in increasing
trade-related technical assistance overall and better coordinating the various bilateral
and multilateral assistance efforts.
Mechanisms for managing risk in international trade: There are
certain inescapable risks that countries face in international trade and most financial
mechanisms for mitigating their effects are provided through the private sector. The
European Union has recently adopted a "system of additional support" to help the
African, Caribbean and Pacific countries with which it is associated to mitigate
instability in export earnings. Speakers noted two other international initiatives:
The Compensatory Financing Facility (CFF) of IMF provides
financial assistance, usually in association with stand-by arrangements, to countries
experiencing temporary export earnings shortfalls and temporary excess cereal import
costs. It was suggested that the scope for use of the CFF be expanded and that it be
strengthened. The World Bank established an international task force on commodity risk
management in developing countries to explore the potential role of international
cooperation in facilitating access of developing countries to market instruments to deal
with intra-annual commodity price fluctuations. Speakers welcomed this initiative,
although major policy aspects were still to be worked out, such as the cost of premiums to
be borne by producers and whether to subsidize use of such a mechanism, at least
initially. Work on the initiative should be accelerated. Insurance against natural
disasters is generally provided by the international private sector. It has been suggested
that relevant international organizations could help boost access of vulnerable countries,
such as small-island developing States, to such insurance. This could be a matter for
public/private partnerships.
There is a need to proceed with the built-in agenda of the WTO.
Developing institutional arrangements for UN/WTO dialogue: WTO
observed that although there were no "organic" links between the United Nations
and WTO, "strong working links" had evolved. Ideas were expressed for how the
dialogue between the United Nations and WTO might be organized, building on the experience
of ECOSOC and the Bretton Woods institutions."
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High-Level
Panel on
Financing for Development -
Recommendations & Technical Report
United Nations, A/55/1000, 26 June 2001
" Recommendations:
Trade
Thanks to eight rounds of multilateral negotiations, much has
been done in half a century to dismantle tariff and non-tariff barriers to trade. But by
far the main beneficiaries of trade liberalization have been the industrial countries.
Developing countries’ products continue to face significant impediments in rich
country markets. Basic products in which developing countries are highly competitive are
precisely the ones that carry the highest protection in the most advanced countries. These
include not only agricultural products, which still face pernicious protection, but also
many industrial products subject to tariff and non-tariff barriers. Therefore, there is an
urgent need to initiate a new round of multilateral trade negotiations. Although some
panel members felt it was crucial that developed countries first rebuilt confidence in the
WTO by delivering on both the spirit as well as the letter of previous agreements, the
Panel as a whole strongly endorses the launching of a new round of trade liberalization at
the next WTO ministerial meeting, to be held in Qatar next November.
The Panel recommends that the following issues be addressed:
The implementation of the Uruguay Round. This issue concerns not
only full compliance with the commitments that industrial countries made under the Uruguay
Round but also a responsible review—open and generous but consistent with free trade
principles—of some regulations that developing countries have found either extremely
hard to implement or outright counterproductive. Chief among these are standards
(technical barriers to trade), anti-dumping, trade-related intellectual property rights
(TRIPS), trade-related investment measures (TRIMS), subsidies, customs valuation, and
phase-in periods for developing countries.
§ Liberalization in agriculture. In this field, it is vital for
developing countries to discuss and get from industrial countries a significant
improvement in market access, an elimination of export subsidies, and a tightening of
support to domestic producers.
§ The total elimination of remaining trade barriers in
manufacturing. Existing barriers in this sector are mostly at the expense of developing
countries. An obvious, but sadly not unique, example of this injustice is protection on
textiles and clothing. Some panel members consider that welfare gains for all parties
would be even greater if the new round also liberalizes trade in services.
Technical Report:
" Trade
Trade is an engine of growth. Both the competitive pressures
needed to produce successfully for the export market and access to the imports necessary
to build a modern economy are essential for any sort of rapid growth, equitable or
otherwise, environment-friendly or environment-destroying. Making growth equitable and
sustainable is the task of other policies; there is in general little reason to regard
trade as inherently biased one way or the other on those dimensions. But since poverty in
a poor country cannot be overcome without sustained rapid growth, the willingness and
opportunity to trade liberally are critical to long-run poverty reduction. It is notable
that, at least since the 1960s, every country that has pulled its people out of poverty
has made a significant opening to trade a central feature of its economic strategy.
The past decade has seen a notable liberalisation of trade by
developing countries, analogous to that earlier undertaken by today’s industrial
countries, at least as regards trade among themselves. Unfortunately, the liberal trade
regime that now prevails among the industrial countries (except in agriculture) is not
matched by free market access extended to the products of interest to developing
countries. In part this is doubtless due to simple protectionism—jobs were perceived
to be at stake. But in part it is also due to the earlier attempts of developing countries
to stand outside the process of making bargains about trade, and to expect to benefit from
concessions without making concessions in return. That finally changed in the most recent
round of multilateral trade negotiations, the Uruguay Round, where developing countries
did participate actively in the bargaining. Their involvement won them some notable gains,
such as the tariffication of quantitative restrictions in agriculture and the phasing out
of the Multi-Fibre Arrangement—albeit gains with a long time fuse. One important task
of the coming years will be to make sure that the industrial countries fully implement
their commitments under the Uruguay Round accords to liberalise trade in areas of great
significance to developing countries.
Even after the Uruguay Round commitments are completely
implemented, however, substantial barriers to developing-country exports will remain. One
recent (post-Uruguay Round) attempt to quantify the benefits of removing all such trade
barriers estimated the potential welfare gain to developing countries at about $130
billion a year (at current prices, and covering only the gains on visible trade)[8] .
Another study concluded that even a 50 per cent tariff cut could give developing countries
a gain in the region of $90 billion to $155 billion a year[9] . It is extremely important
that developing countries be given the opportunity to realise these gains. Although some
panel members felt it was crucial that developed countries first rebuild confidence in the
WTO by delivering on both the spirit as well as the letter of previous agreements, the
Panel as a whole felt the best approach would be to initiate a new round of multilateral
trade negotiations at the ministerial meeting of the World Trade Organization (WTO)
planned for Qatar in November 2001. This should be truly a Development Round, and indeed
that title has been widely suggested. The industrial countries, whose leadership will be
indispensable in making a new round successful, will need to accept that the negotiations
are centred on questions of concern to developing countries. They must enter the
negotiations prepared to make substantive concessions on those issues; many developing countries might find it difficult to
start negotiations without some assurance of such willingness. The Qatar ministerial
meeting should set an objective of making trade as free between industrial and developing
countries as it already is among the industrial countries.
A Development Round would need
to deal with the following agenda:
ˇ Finishing the business of
the Uruguay Round. This means securing full implementation of the spirit as well as the
letter of the commitments that industrial countries made in those negotiations. There is
also a need to review regulations that developing countries have found either hard to
implement or unexpectedly onerous.
ˇ Strengthening the rules of
the WTO system . This is of critical importance for developing countries, because it is
the least powerful countries that most need strong rules. Anti-dumping rules, for example,
are being increasingly abused and need to be disciplined by the international system.
ˇ Liberalising trade in
agricultural products . All analyses indicate that this would benefit developing
countries. Of course, the implications of full liberalisation would be enormously greater
for some products, like sugar, than for others. The real cost of producing sugar in
developing countries is as little as a third what it is in some EU countries, but
developing-country exports are kept out by an EU tariff of 213 per cent. Agricultural
subsidies in the member countries of the Organisation for Economic Co-operation and
Development (OECD) amounted to $361 billion in 1999, more than the entire GDP of
Sub-Saharan Africa. The aim should be complete liberalisation of agricultural trade, with
at most two qualifications. First, in the industrial countries, any concern to sustain the
real income of the rural sector should be addressed by subsidies focused on environmental
protection rather than agricultural output. Second, in developing countries, a continuing
concern with food security may justify variable import tariffs when world prices are low,
given that these countries cannot afford extensive farm subsidies.
ˇ Reducing tariff peaks and
tariff escalation Even after the Multi-Fibre Arrangement has been phased out under the
Uruguay Round agreement, the average tariff on textiles and clothing in OECD countries
will be 8 per cent, compared with 3 per cent on other manufactures. For many other
developing-country exports, market access is limited by particularly high tariffs or by
tariffs that escalate with the degree of processing. This prevents developing countries
from producing higher-value products and moving up the development ladder.
ˇ Reforming trade-related
intellectual property rights . This was a topic covered for the first time by the
multilateral trade regime in the Uruguay Round. But many developing countries have found
it impractical to impose and enforce state-of-the-art intellectual property laws on the
model prescribed in the WTO agreement. Furthermore, some of the results, such as the high
cost of HIV/AIDS medicines and other patented pharmaceutical products in poor countries,
have aroused much anxiety. This whole question needs to be re-examined, with a view, among
other things, to seeking ways to increase the availability of low-cost medicines without
unduly affecting the incentive to innovate and introduce new products.
ˇ Legitimating limited,
time-bound protection of certain industries by countries in the early stages of
industrialisation . However misguided the old model of blanket protection intended to
nurture import substitute industries, it would be a mistake to go to the other extreme and
deny developing countries the opportunity of actively nurturing the development of an
industrial sector. A requirement for international approval of such protection could be a
help to the governments of developing countries in resisting excessive demands from their
domestic lobbies (and from multinationals considering local investment).
ˇ Taking a new look at
liberalising migration . The time may also be ripe to start seeking some measure of
international agreement on ‘the movement of natural persons’, meaning rules
governing short-term overseas employment, which could provide an even larger source of
foreign exchange for developing countries than in the past.
This list is not intended to
suggest that a new trade round should be limited to these topics. Some Panel members
believe that the gains to all countries could be even greater if a new round also includes
services. Rather, the purpose of the list is to identify those topics that must not be
omitted if developing countries are to be fully included in the world trading system on an
equitable basis.
One issue that has impeded
agreement on the launch of a new round is the use of trade sanctions to promote labour or
environmental standards. These topics are best dealt with by developing the international
institutions specifically focused on labour and the environment, as discussed in section
5.
In recent years trade
liberalisation has often occurred on a regional rather than a global basis. Regional
agreements can be a constructive way of advancing more liberal trade and are often of
special importance for small countries, but it is important to make them building blocks
of, and not stumbling blocks to, a global free trade system. Such agreements should be
fully WTO-consistent, and their pursuit should not become an excuse for delaying
multilateral liberalisation.
Trade rounds take a long time
to reach fruition. The problems of the least developed countries cannot wait that long.
Some initiatives have already been taken to strengthen their trading position. The WTO,
the World Bank, the International Monetary Fund (IMF), UNCTAD, the United Nations
Development Programme, and the UNCTAD- and WTO-sponsored International Trade Centre have
jointly launched an ‘Integrated Framework’ designed to build up the capacity of
the least developed countries for trade negotiation and to assist their export
diversification. The extent to which countries are able to take advantage of improvements
in market access obviously depends on a range of supply-side factors, many of which are
covered by the discussion of domestic policies in the previous section. In the case of
many least developed countries, these problems are so acute that it is right for the
international community to give some immediate help in capacity building. The Trust Fund
that has been established to support the Integrated Framework will do just that. It
deserves generous financing.
The WTO has also tried to shame
the industrial countries into improving market access for the least developed countries.
New Zealand and Norway have already opened their markets completely. The United States has
responded with its special programmes for Africa and the Caribbean, which have received
congressional approval and are now being implemented, although unfortunately with
limitations that are liable to curtail their value. The European Commission proposed that
the European Union phase out all quota and tariff restrictions on imports of everything
but arms from the least developed countries over 2002 to 2004. That proposal was approved
in the Council of Ministers in February 2001, although with regrettable delay in giving
unrestricted market access in bananas, rice, and sugar. It is important to secure faithful
and prompt implementation of this commitment and to obtain actions at least as good from
all other industrial countries. An immediate and useful step would be to implement without
further delay all Uruguay Round concessions affecting the least developed countries,
provided, of course, that such concessions not be allowed to substitute for overall
liberalisation.
Many of the poorest countries
still remain overwhelmingly dependent on primary commodities for their export revenue. In
fact, more than 50 developing countries, including about two-thirds of the HIPCs, depend
on three or fewer commodities for more than half their export earnings. This exposes them
to two problems. One is that over the long run the prices of these goods have tended to
fall in real terms, making it increasingly difficult for producers in these countries to
earn a decent living and for the countries to buy the imports they need to grow. The other
is that both the producers and their countries are buffeted by strong cyclical pressures,
because commodity prices often vary sharply with the state of global demand.
It is difficult to imagine how
the first problem could be resolved by direct intervention to support prices.
International commodity agreements have occasionally managed to hold up prices for a few
years. But such success has invariably attracted additional producers and dampened demand
until the agreement finally collapsed, leading to adjustments even sharper and more
painful than would have been experienced in a free market. At the root of the problem is
that, under current circumstances, any rise in commodity prices spurs a rush of new
entrants hoping to scratch out a living by supplying the world market, even if at a
starvation wage. The problem will be overcome only when development has proceeded far
enough to make such desperate behaviour unnecessary.
There is also a long history of
attempts to reduce the cyclical variability of commodity prices, or at least to reduce its
impact. Although some modest initiatives, such as the IMF’s Compensatory Financing
Facility, have been useful at the margin, none of the grand proposals floated, from Keynes
onward, has ever secured agreement. Even commodity agreements that did not aim to hold
prices permanently above their market-clearing levels have eventually collapsed. It is
regrettable that the Compensatory Financing Facility was scaled back in the 1980s. It
deserves to be restored and improved.
One interesting new approach
for making a limited assault on the problem is a scheme for commodity risk management in
developing countries[10] . This new initiative differs from its predecessors in two key
respects. First, it makes no attempt to stabilise market prices, but rather focuses on the
price received by the individual producer. Second, although it envisages the creation of a
new intermediary within some international organisation to operate the scheme, this
intermediary would reinsure its contracts with private sector insurers, so that the terms
it offered would be essentially those being quoted by the private sector. The job of the
intermediary would be to make these terms widely available to poor farmers and other
producers in developing countries who now lack access to private insurance.
The proposed intermediary would
sell insurance to producers on the prices of at least the 12 principal commodities
exported by developing countries. Aid resources could be used to pay a part of the premium
costs of poor producers, provided the eligibility criteria are unambiguous; producers with
incomes above that threshold would be required to cover the costs. Since the intermediary
would quote premium rates based on going rates in the commercial markets with which it
would reinsure most of its risk, it would be largely risk-free.
How useful would such a
mechanism be? It is important to be clear that it would not claim to stabilise prices
received by producers, but rather to give them advance assurance of the minimum price that
they will receive. This would be of special value to farmers with a choice of annual
crops. They would be better able to decide which crop to sow if they knew, at planting
time, the minimum price they would eventually receive for each alternative crop. The
scheme would only stabilise the incomes of other producers (such as those harvesting
coffee and other tree crops) to the extent that they would make claims on their insurance
when times are bad and not when they are good. As world market prices fluctuate, so would
the guaranteed minimum price that could be bought for a given insurance premium. Although
the potential benefits of such a scheme are fairly modest, it would be worth initiating
one promptly, at least on a trial basis.
In contrast to the many
initiatives over the years to liberalise trade, and more recently to free capital
movements, there has never been any comparable initiative to free the movement of persons
between countries. In the light of demographic developments in the industrial countries
(in particular, the ageing of their populations) and the potential benefits of migration
in generating remittances to developing countries, the time has come to put this issue on
the international agenda.
The increased trading
opportunities called for in this section would create the chance for many more developing
countries to enter the virtuous circle of export-led growth. These better market
opportunities would need to be supplemented by strong support for capacity building and
efforts to limit the havoc wrought by weak commodity prices. Only then will trade fulfil
its potential in helping the poorest countries achieve the International Development
Goals."
Full Text of
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FfD-Themes
United Nations,
09/17/01
" International trade as
an engine for growth and development
18. Trade liberalization would
substantially contribute to achieve development worldwide, benefiting both developed and
developing countries. Yet, trade barriers and subsidies in developed countries currently
impose costs on developing countries that significantly exceed aid flows. Those barriers
and subsidies must be eliminated. We recognize the need to ensure an open, equitable,
rule-based, predictable, and non-discriminatory multilateral trading system, that
decisively benefits all developing countries and countries with economies in transition,
including low-income countries, SIDs, and landlocked developing countries.
19. The lifting of trade
barriers should not be followed by the introduction of new ones –even if these are
motivated by commendable objectives. Labor and environmental concerns need to be properly
addressed, but should be pursued as separate goals, through the appropriate institutions
and fora, so that efforts to achieve trade liberalization and improved labor and
environmental standards can be mutually reinforcing.
20. We commit ourselves to
deepen all efforts made thus far to ensure that world trade supports development goals,
including by securing full implementation of all commitments made by industrialized
countries at the Uruguay Round, and by multilateral trade negotiations geared to:
Strengthening the rules and
disciplines of the World Trade Organization, to prevent abuses to the detriment of
developing countries, such as abusive antidumping measures or technical standards against
their exports. Liberalizing trade in agricultural products, fully eliminating output and
export subsidies in developed countries Reducing tariff peaks which affect developing
countries exports, and eliminating tariff escalation which discourages developing
countries from exporting higher value added products. Eliminating the trade barriers of
developed countries in manufactures, particularly labor-intensive manufactures such as
textiles and clothing. Revisiting the issue of trade-related intellectual property rights,
with a view to promoting the widest availability of knowledge for development without
unduly affecting incentives to innovate, taking care –in particular- of the health
imperatives of developing countries.
21. Regional and sub-regional
cooperation and integration processes can play a key role in fostering global trade and
development, by improving competitiveness and export diversification. We also commit
ourselves to enhancing the role of regional and sub-regional agreements and free trade
areas as building blocks in the construction of a better global trading system.
22. To speed up our efforts to
ensure full access of developing country exports to all markets—with no exception but
arms—, we call on all industrialized countries that have not already done so, to take
immediate steps in benefit of the LDCs, as well as in support of the New African
Initiative and the development efforts of all other low-income countries, SIDs, and
landlocked developing countries.
23. We also call on the
multilateral financial and development institutions to devise ways and means to stabilize
the export revenue of developing countries that still depend heavily on commodity exports,
in particular low income countries, SIDS and landlocked developing countries, including by
restoring and improving the IMF compensatory financing facility scheme, establishing
appropriate multilateral commodity risk management mechanisms, and ensuring access to
insurance against natural catastrophes.
24. We further call on
multilateral and bilateral financial and development institutions to deepen their support,
with additional resources, of efforts by developing countries, including low-income
countries, SIDs, and landlocked developing countries, to remove supply-side constraints,
improve their trade infrastructure, diversify export capacity, and enhance their
participation in multilateral trade negotiations, trade opportunities, and the dispute
settlement mechanism."
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United
Nations,12/06/01
"International trade as an
engine for development
23. Freer trade would
substantially stimulate development worldwide, benefiting both industrial and developing
countries. The current slowdown in the world economy urges us to reaffirm our commitment
towards trade liberalization, and ensuring that trade plays its full part in promoting
recovery, growth and development. We thus welcome the WTO’s decision reached in Doha
to launch a new round of trade negotiations and the intent to place the needs and
interests of developing countries at the heart of the WTO work program.
24. To benefit fully from
trade, which in many cases is the single most important source of development financing,
developing and transition countries must establish appropriate institutions and policies.
Trade liberalization is a fundamental element in the development strategy of a country.
The active promotion of exports and the attraction of foreign direct investment boost
economic growth and are an important source of employment.
25. Nations will only attain
full benefits from such reforms if we ensure an open, equitable, rule-based, predictable,
and non-discriminatory multilateral trading system. Trade barriers, subsidies, and other
trade-distorting measures, particularly in agriculture, have negative effects on
developing countries that significantly exceed the value of aid flows—and must be
eliminated.
26. To ensure that world trade
supports development goals, we will strive to:
§ Strengthen the rules and
disciplines of the World Trade Organization, to prevent abuses, particularly in
antidumping measures; secure full implementation of all commitments made at the Uruguay
Round; and facilitate, in non-discriminatory terms, the accession of all developing and
transition countries to the WTO.
§ Liberalize trade in
agricultural products, eliminating export subsidies and substantially reducing production
subsidies in developed countries; accelerate the elimination of trade barriers of
developed countries in manufactures, particularly labor-intensive manufactures such as
textiles and clothing; liberalize trade in services of export interest to developing
countries; address the issue of labor migration through rules governing short-term
overseas employment; and reduce tariff peaks, eliminate tariff escalation, and make fully
operational the special and differential treatment provisions in trade agreements.
§ Regarding trade-related
intellectual property rights, ensure recognition of traditional knowledge and promote the
transfer of knowledge and technology, while providing incentives to innovate, and
respecting—in particular—the health needs of developing countries.
We encourage the WTO member
countries to make their best efforts to achieve these goals as they implement the WTO work
program adopted at Doha.
27. We also commit ourselves to
enhancing the role of regional and sub-regional agreements and free trade areas in the
construction of a better global trading system. International financial institutions,
including the regional development banks, should give priority to projects that support
sub-regional and regional integration among developing countries.
28. To speed up our efforts to
ensure full and predictable access of developing country exports to all markets, we call
on industrial countries that have not already done so, to take immediate steps to benefit
the least developed countries, as well as to support the New Partnership for African
Development, and the small island, landlocked, and transit developing countries. At the
same time, developing and transition countries must reduce, and when possible eliminate,
trade barriers among themselves.
29. To further support national
efforts to benefit from trade opportunities, we call on multilateral and bilateral
financial and development institutions to deepen their support, with additional resources,
for removing supply-side constraints, improving trade infrastructure, diversifying export
capacity, strengthening institutional development, and enhancing overall productivity and
competitiveness.
30. Multilateral help is also
needed to stabilize the export revenue of countries that still depend heavily on commodity
exports. Thus, we welcome the review and impending activation of the IMF Compensatory
Financing Facility. It is also important to empower developing country commodity producers
to insure themselves against risk, including against natural disasters.
31. In support of the process
launched in Doha, attention should go to strengthening the participation of developing
countries in multilateral trade negotiations. In particular, developing countries need
assistance to participate effectively in the new WTO work program through enhanced
cooperation of all relevant stakeholders, including UNCTAD. To these ends, we undertake to
make the financing of trade-related technical assistance and capacity building more secure
and predictable."
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Draft outcome of the
International Conference on Financing for Development
-Monterrey Consensus
International trade as an engine for development
26. A universal, rule-based, open, non-discriminatory
and equitable multilateral trading system, as well as meaningful trade liberalization, can
substantially stimulate development worldwide, benefiting countries at all stages of
development. In that regard, we reaffirm our commitment to trade liberalization and to
ensure that trade plays its full part in promoting economic growth, employment and
development for all. We thus welcome the decisions of the World Trade Organization to
place the needs and interests of developing countries at the heart of its work programme,
and commit ourselves to their implementation.
27. To benefit fully from trade, which in many cases
is the single most important external source of development financing, the establishment
or enhancement of appropriate institutions and policies in developing countries, as well
as in countries with economies in transition, is needed. Meaningful trade liberalization
is an important element in the sustainable development strategy of a country. Increased
trade and foreign direct investment could boost economic growth and could be a significant
source of employment.
28. We acknowledge the issues of particular concern
to developing countries and countries with economies in transition in international trade
to enhance their capacity to finance their development, including trade barriers,
trade-distorting subsidies and other trade-distorting measures, particularly in sectors of
special export interest to developing countries, including agriculture; the abuse of
anti-dumping measures; technical barriers and sanitary and phytosanitary measures; trade
liberalization in labour intensive manufactures; trade liberalization in agricultural
products; trade in services; tariff peaks, high tariffs and tariff escalation, as well as
non-tariff barriers; the movement of natural persons; the lack of recognition of
intellectual property rights for the protection of traditional knowledge and folklore; the
transfer of knowledge and technology; the implementation and interpretation of the
Agreement on Trade-Related Aspects of Intellectual Property Rights 4 in a manner
supportive of public health; and the need for special and differential treatment
provisions for developing countries in trade agreements to be made more precise, effective
and operational.
29. To ensure that world trade supports development
to the benefit of all countries, we encourage the members of the World Trade Organization
to implement the outcome of its Fourth Ministerial Conference, held in Doha, Qatar from 9
to 14 November 2001.
30. We also undertake to facilitate the accession of
all developing countries, particularly the least developed countries, as well as countries
with economies in transition, that apply for membership of the World Trade Organization.
31. We will implement the commitments made in Doha to
address the marginalization of the least developed countries in international trade as
well as the work programme adopted to examine issues related to the trade of small
economies.
32. We also commit ourselves to enhancing the role of
regional and subregional agreements and free trade areas, consistent with the multilateral
trading system, in the construction of a better world trading system. We urge
international financial institutions, including the regional development banks, to
continue to support projects that promote subregional and regional integration among
developing countries and countries with economies in transition.
33. We recognize the importance of enhanced and
predictable access to all markets for the exports of developing countries, including small
island developing States, landlocked and transit developing countries and countries in
Africa, as well as countries with economies in transition.
34. We call on developed countries that have not
already done so to work towards the objective of duty-free and quota-free access for all
least developed countries’ exports, as envisaged in the Programme of Action for the
Least Developed Countries adopted in Brussels. Consideration of proposals for developing
countries to contribute to improved market access for least developed countries would also
be helpful.
35. We further recognize the importance for
developing countries as well as countries with economies in transition of considering
reducing trade barriers among themselves.
36. In cooperation with the interested Governments
and their financial institutions and to further support national efforts to benefit from
trade opportunities and effectively integrate into the multilateral trading system, we
invite multilateral and bilateral financial and development institutions to expand and
coordinate their efforts, with increased resources, for gradually removing supply-side
constraints; improve trade infrastructure; diversify export capacity and support an
increase in the technological content of exports; strengthen institutional development and
enhance overall productivity and competitiveness. To that end, we further invite bilateral
donors and the international and regional financial institutions, together with the
relevant United Nations agencies, funds and programmes, to reinforce the support for
trade-related training, capacity and institution building and trade-supporting services.
Special consideration should be given to least developed countries, landlocked developing
countries, small island developing States, African development, transit developing
countries and countries with economies in transition, including through the Integrated
Framework for Trade-Related Technical Assistance to Least Developed Countries and its
follow-up, the Joint Integrated Technical Assistance Programme, the World Trade
Organization Doha Development Agenda Global Trust Fund, as well as the activities of the
International Trade Centre.
37. Multilateral assistance is also needed to
mitigate the consequences of depressed export revenues of countries that still depend
heavily on commodity exports. Thus, we recognize the recent review of the International
Monetary Fund Compensatory Financing Facility and will continue to assess its
effectiveness. It is also important to empower developing country commodity producers to
insure themselves against risk, including against natural disasters. We further invite
bilateral donors and multilateral aid agencies to strengthen their support to export
diversification programmes in those countries.
38. In support of the process launched in Doha,
immediate attention should go to strengthening and ensuring the meaningful and full
participation of developing countries, especially the least developed countries, in
multilateral trade negotiations. In particular, developing countries need assistance in
order to participate effectively in the World Trade Organization work programme and
negotiating process through the enhanced cooperation of all relevant stakeholders,
including the United Nations Conference on Trade and Development, the World Trade
Organization and the World Bank. To those ends, we underscore the importance of effective,
secure and predictable financing of trade-related technical assistance and
capacity-building.
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