SECOND COMMITTEE PASSES TEXT EXPRESSING CONCERN OVER FAILURE BY SOME POOR COUNTRIES TO ACHIEVE LASTING DEBT SUSTAINABILITY

6 December 2006
GA/EF/3172

SECOND COMMITTEE PASSES TEXT EXPRESSING CONCERN OVER FAILURE BY SOME POOR COUNTRIES TO ACHIEVE LASTING DEBT SUSTAINABILITY

6 December 2006
General Assembly
GA/EF/3172
Department of Public Information • News and Media Division • New York

SECOND COMMITTEE PASSES TEXT EXPRESSING CONCERN OVER FAILURE BY SOME

POOR COUNTRIES TO ACHIEVE LASTING DEBT SUSTAINABILITY

 

Action Taken amid Unanimous Approval of Nine Draft Resolutions, One Decision

The General Assembly would note, with concern, that some participants in the Heavily Indebted Poor Countries (HIPC) Debt Initiative had not achieved lasting debt sustainability even after reaching “completion point”, according to a draft resolution approved by the Second Committee (Economic and Financial) this afternoon.

That text –- approved unanimously alongside eight other draft resolutions and one draft decision -- would have the Assembly urge donors to ensure that their commitments to the Multilateral Debt Relief Initiative (MDRI) and the Heavily Indebted Poor Countries (HIPC) Debt Initiative were additional to existing aid flows, and that they were based on fair burden-sharing among donors.

In order to ensure long-term debt sustainability, the Assembly would, by other terms of the text, call for such measures as increased grant-based financing, cancellation of the official multilateral and bilateral debt owed by heavily indebted poor countries and significant debt relief, or restructuring for low- and middle-income developing countries burdened by unsustainable debt but which were not part of the HIPC Initiative.

Also by that draft, the Assembly would note the important role played by credit rating agencies in determining countries’ access to international capital markets, and call upon international financial and banking institutions to consider enhancing the transparency of risk rating mechanisms.  It would also note that sovereign risk assessments by the private sector should maximize the use of strict, objective and transparent parameters, which could be facilitated by high-quality data and analysis.  Further by that text, the Assembly would call on the United Nations to take appropriate measures to implement the major United Nations accords relating to the external debt problems of developing countries, while inviting the Bretton Woods institutions and the private sector to do the same.

By the terms of another draft resolution, on commodities, the Assembly would express the urgent need to improve the functioning of commodity markets through efficient and transparent mechanisms, including commodity exchanges, amid deep concern that supply capacity problems and difficulties with adding value to their products were keeping many developing countries from the full benefits of price increases.  The Assembly would also call on developed countries, and developing countries declaring themselves in a position to do so, to provide lasting duty- and quota-free market access for all goods originating from the least developed countries (LDCs), in recognition of their dependence on primary commodities as their principal source of export revenues.

The Committee also approved a draft resolution on the role of microcredit and microfinance in the eradication of poverty, by which the Assembly would call for the wider use of microfinance as a poverty eradication tool and for the dissemination of best practices in its use.  It would call also for improvements to the policies and regulatory frameworks governing microfinance and microcredit institutions, and invite the international community to support developing countries in collecting the necessary data to assess that sector.

In another action, the Committee approved a draft on the United Nations University, by which the Assembly would express its deep gratitude and appreciation to Hans van Ginkel, who had reached the end of his tenure as Rector of the University.  It would also request the Secretary-General to continue to encourage other United Nations bodies to use, more fully, that institution’s capacity to mobilize a worldwide network of researchers in helping it solve global problems.

Four other draft resolutions approved today included texts on the International Year of Forests, 2011; the International Strategy for Disaster Reduction; Implementation of the outcome of the United Nations Conference on Human Settlements (Habitat II) and strengthening of the United Nations Human Settlements Programme (UN-HABITAT); and the Third United Nations Conference on the Least Developed Countries.

The Committee also approved a draft decision on programme planning.

Speaking in explanation of position during today’s action were the representatives of Switzerland, Finland (on behalf of the European Union and associated States), United States, New Zealand (also on behalf of Australia and Canada), South Africa (on behalf of the “Group of 77” developing countries and China), Republic of Korea, Iran, Canada and Japan.

The Second Committee will meet again on Friday, 8 December, to consider all outstanding draft resolutions.

Background

The Committee met this afternoon to take action on draft resolutions relating to macroeconomic policy questions, sustainable development, the United Nations Human Settlements Programme (UN-HABITAT), groups of countries in special situations, the eradication of poverty and training and research.  It was also expected to take action on a draft decision on programme planning.

By a draft resolution on external debt crisis and development (document A/C.2/61/L.54), the General Assembly would emphasize the need for creditors and debtors to share responsibility for preventing unsustainable debt situations.  It would also emphasize that no single indicator should be used to make definitive judgements about debt sustainability, and in that regard, invite the International Monetary Fund (IMF) and the World Bank to take account of changes caused by natural disasters, conflicts and changes in global growth prospects or in the terms of trade, especially for commodity-dependent developing countries, when making debt-sustainability assessments, and to continue to provide information on that issue using existing cooperation forums.

The same text would have the Assembly urge donors to ensure their commitments to the Multilateral Debt Relief Initiative (MDRI) and the Heavily Indebted Poor Countries Initiative (HIPC) are additional to existing aid flows, and that they are based on fair burden-sharing among donors.  The Assembly would note, with concern, that some countries that have reached the completion point of the HIPC Debt Initiative had not achieved lasting debt sustainability, and would stress, in that connection, the importance of helping those countries avoid a build-up of unsustainable debt through, for example, the use of grants and concessional loans.  It would underscore the importance of the joint IMF-World Bank Debt Sustainability Framework for low-income countries to help ensure that new borrowing in post-MDRI countries do not undermine their long-term debt sustainability, and encourage its application in lending and borrowing decisions.

To ensure long-term debt sustainability, the Assembly would, by other terms of the draft, call for various measures to be considered, such as increased grant-based financing, the cancellation of 100 per cent of the official multilateral and bilateral debt of heavily-indebted poor countries and, on a case-by-case basis, significant debt relief or restructuring for low- and middle-income developing countries with an unsustainable debt burden that are not part of the HIPC Initiative.  The Assembly would stress the need to significantly address the debt problems of middle-income developing countries, while stressing also the importance of the Paris Club’s Evian approach as a practical means to address this issue.

The Assembly would, by other terms, note that credit rating agencies play an important role in determining countries’ access to international capital markets, and in that regard, call upon international financial and banking institutions to consider enhancing the transparency of risk rating mechanisms.  It would note also that sovereign risk assessments made by the private sector should maximize the use of strict, objective and transparent parameters, which can be facilitated by high-quality data and analysis.  Further by that text, the Assembly would call on the United Nations to take appropriate measures to implement the major United Nations accords relating to the external debt problems of developing countries, while inviting the Bretton Woods institutions and the private sector to do the same.

Also before the Committee was a draft resolution on Commodities (document A/C.2/61/L.56), by which the Assembly -- deeply concerned that supply capacity problems and difficulties with effective participation in value chains are preventing many developing countries from fully benefiting from price increases –- would express an urgent need to improve the functioning of commodity markets through efficient and transparent mechanisms, including commodity exchanges.

That text would also have the Assembly express concern over the suspension of the Doha Round and call for its early resumption, while indicating that the outcome of those talks should be development-oriented and adhere fully to the Doha Ministerial Declaration, the Framework adopted by the General Council of the World Trade Organization, in its decision of 1 August 2004, and the Hong Kong Ministerial Declaration.  The Assembly would call on developed countries, and developing countries declaring themselves in a position to do so, to provide duty- and quota-free market access on a lasting basis for all products originating from all least developed countries, consistent with the Hong Kong Ministerial Declaration.  It would do so in recognition of the fact that many developing countries are highly dependent on primary commodities as their principal source of export revenues.

Also by that text, the Assembly would stress that the adoption or enforcement of any measures necessary to protect human, animal or plant life or health not be applied in a manner that would constitute arbitrary and abusive use of non-tariff measures, non-trade barriers or other standards to unfairly restrict the access of developing countries’ products to developed-world markets.  It would reaffirm the increased role of developing countries in formulating safety, environment and health standards while calling on developed countries to help developing ones to put in place measures that are appropriate and necessary for meeting standards and other market requirements.

By that same text, the Assembly would call for capacity-building support from developed countries and encourage the private sector to enable developing countries to develop the necessary measures to meet market requirements.  It would invite relevant intergovernmental organizations to help establish procedures for creating product and process standards without jeopardizing the legitimate objective, for developed as well as developing countries, of protecting human, animal and plant life or health, consistent with the General Agreement on Tariffs and Trade and other World Trade Organization agreements.

Emphasizing the importance of official development assistance to agriculture and rural development, the Assembly would -- by other terms -- call on donors to increase financial and technical support for activities aimed at addressing commodity issues, in particular, in commodity-dependent developing countries.  It would underline the need to strengthen the Common Fund for Commodities and encourage it, in cooperation with the International Trade Centre UNCTAD/WTO, UNCTAD and others to continue to strengthen activities related to improving access to markets and reliability of supply, enhancing diversification and adding value, improving the competitiveness of commodities, strengthening the market chain, improving market structures, broadening the export base and ensuring the effective participation of all stakeholders.

Further by that text, the Assembly would express concern that the International Task Force on Commodities, launched at the eleventh session of UNCTAD, has not entered into force owing to the absence of financial support from Member States and would call upon all stakeholders to provide the required financial support for its timely establishment.

By another draft resolution, on the International Year of Forests, 2011 (document A/C.2/61/L.21/Rev.1), the General Assembly -- while reaffirming its commitment to the Convention on Biological Diversity, the United Nations Framework Convention on Climate Change, the United Nations Convention to Combat Desertification and other accords dealing with the complexity of forest issues -- would declare 2011 as the International Year of Forests, while requesting the secretariat of the United Nations Forum on Forests, Department of Economic and Social Affairs, to serve as the focal point.

Also before the Committee was a draft on the International Strategy for Disaster Reduction (document A/C.2/61/L.58) by which the Assembly would call on the international community to fully implement the commitments of the Hyogo Declaration and the Hyogo Framework for Action.  It would call on the United Nations system, international financial institutions and international organizations, to integrate the goals of the Hyogo Framework into their programmes and to assist developing countries to design and implement disaster risk reduction measures with a sense of urgency.

By other terms, the Assembly would note the proposed establishment of a global platform for disaster risk reduction as the successor mechanism to the Inter-Agency Task Force for Disaster Reduction, and, taking into account the implementation of the Hyogo Framework for Action, decide that the Global Platform shall have the same mandate as the Inter-Agency Task Force.  It would decide that the proposed Global Platform be open to all Member States.

A draft on the Implementation of the United Nations Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, Particularly in Africa (document A/C.2/61/L.55) would have the Assembly reaffirm its resolve to address the causes of desertification and land degradation -- and the poverty resulting from it -- through adequate and predictable financing, technology transfer and capacity-building.

Also by that text, the Assembly would reiterate its calls on Governments, in collaboration with relevant multilateral organizations, such as the Global Environment Facility implementation agencies, to integrate desertification into their plans and strategies for sustainable development.  It would take note of the outcome of the fourth replenishment of the Global Environment Facility Trust Fund, including pledges made by the international community to the Trust Fund at the Third Assembly of the Global Environment Facility, held in Cape Town, South Africa, in August.

A draft on the Implementation of the outcome of the United Nations Conference on Human Settlements (Habitat II) and strengthening of the United Nations Human Settlements Programme (document A/C.2/61/L.57) would have the Assembly request the Governing Council of the Programme (UN-HABITAT) to address, in a comprehensive manner, any issues relating to the United Nations Habitat and Human Settlements Foundation at its twenty-first session, bearing in mind the need to effectively mobilize resources for the Foundation.

In that text, the Assembly would call for increased voluntary contributions to the United Nations Habitat and Human Settlements Foundation, and invites Governments to provide predictable multi-year funding to implement its programmes.  It would also call for increased, non-earmarked contributions to the Foundation.

Also by that text, the Assembly would emphasize the importance of the Nairobi headquarters location of UN-HABITAT and request the Secretary-General to keep its resource and those of the United Nations Office at Nairobi under review so as to permit the effective delivery of necessary services to UN-HABITAT and the other United Nations organs and organizations in Nairobi.  The Assembly would reiterate the need for UN-HABITAT to continue to work with the World Bank, regional development banks and other relevant partners to field-test innovative policies, practices and pilot projects so as to increase the supply of affordable credit for slum upgrading and other pro-poor human settlements development in developing countries.

Further by the text, the Assembly would request UN-HABITAT, through its involvement in the Executive Committee on Humanitarian Affairs and its contacts with relevant United Nations agencies and partners in the field, to promote the early involvement of human settlements experts in assessing and developing prevention, rehabilitation and reconstruction programmes to support the efforts of developing countries affected by natural disasters and other complex humanitarian emergencies.

Another draft resolution, on the Third United Nations Conference on the Least Developed Countries (document A/C.2/61/L.64), would have the Assembly acknowledge that the precarious socio-economic situation of the least developed countries means that many are unlikely to achieve their development goals.  It would urge least developed countries to strengthen national implementation of the Programme of Action for the Least Developed Countries for the Decade 2001-2010 through poverty reduction strategy papers, the common country assessment and the United Nations Development Assistance Framework (UNDAF), where they exist.

Also by that draft, the Assembly would stress the need to use quantifiable criteria to measure progress in implementing the goals and targets of the Programme of Action.  The Secretary-General would be requested to ensure full mobilization of all parts of the United Nations system to facilitate coordinated implementation, follow-up and monitoring of the Programme, through the United Nations System Chief Executive Board for Coordination, the United Nations Development Group, the Executive Committee on Economic and Social Affairs and the Inter-Agency Task Force on the Millennium Development Goals.

A draft resolution on the Role of microcredit and microfinance in the eradication of poverty (document A/C.2/61/L.63) would have the Assembly take note of the lack of relevant statistical data on microfinance and microcredit programmes, particularly at the national and regional levels, and invite the international community, particularly the donor community, to support developing countries in collecting the relevant data.  The Assembly would call on Member States, the United Nations system and other stakeholders to maximize the use of microcredit and microfinance as tools to eradicate poverty and disseminate best practices in the microfinance sector.  It would call on those same actors, as well as the Bretton Woods institutions, to support developing countries to improve the policy and regulatory framework of their microfinance and microcredit institutions.

By a text on the United Nations University (document A/C.2/61/L.36/Rev.1), the Assembly would express a deep appreciation to Japan and other host countries of the University and its research and training centres and programmes, as well as to public and private entities for their financial, intellectual and other contributions to the University.  It would welcome the diversification of the University’s budgetary resources and encourage the international community to provide voluntary contributions to ensure a sound funding base.  Further, it would request the University to renew its efforts to identify critical areas of research most needed by other United Nations organizations, to carry out research that yields effective outcomes contributing to policymaking and to disseminate the outcome of its research more widely.

Also before the Committee was a draft resolution on Preventing and combating corrupt practices and transfer of assets of illicit origin and returning such assets, in particular, to the countries of origin, consistent with the United Nations Convention against Corruption (document A/C.2/61/L.53).  By its terms, the Assembly would take note of the Secretary-General’s report on that issue (document A/61/177) as well as the Government of Indonesia’s offer to host the second session of the Conference of States Parties.  It would urge Member States and regional economic integration organizations, within the limits of their competence, to consider ratifying or acceding to the Convention, and call on States parties to quickly and fully implement its provisions.

The Committee also had before it a draft decision on Programme planning (document A/C.2/61/L.50) by which the Assembly would decide to approve the subprogramme on Economic and Social Council support and coordination falling under the programme on economic and social affairs of the proposed strategic framework for the period 2008-2009.

TIINA INTELMANN ( Estonia), Committee Chairperson, began the meeting by expressing the membership’s condolences to the victims of Typhoon Durian, especially those in the Philippines.

She then turned the Committee’s attention to the draft resolutions before it.

Action on Draft Resolution

VANESSA GOMES ( Portugal), Rapporteur of the Committee, introduced the draft resolution on External debt crisis and development (document A/C.2/61/L.54) and made minor oral amendments to two preambular paragraphs and one operative paragraph of the text.

The Committee then approved the draft without a vote, as orally amended, withdrawing an earlier version (document A/C.2/61/L.6).

Explanations of Position

Speaking after that action, the representative of Switzerland said his country had joined the consensus on the text, but felt its title did not faithfully reflect reality.  The overall situation was no longer so bleak as to merit the label of “crisis”, although the reappearance of a crisis could not be excluded in the future.  Also, analysis of a country’s debt situation should take into account the debt contracted on the domestic market.  Financial decisions that disregarded internal debt would be unsound.  Lastly, debt reduction initiatives could and should contribute to the adjustment of debt levels to sustainable levels.  However, a 100 per cent annulment of debt was not viewed as the goal of such debt reduction initiatives since it was not a fair and balanced way to help debt-afflicted countries to find a solution.

The representative of Finland, speaking on behalf of the European Union and associated States, pointed out that the regional body’s member countries had provided the lion’s share of debt relief to the poorest countries during the last few years.  Although a number of low- and middle-income countries were still facing difficulties in finding durable solutions to their external debt problems, it was fair to say that the world was not facing an “external debt crisis”.  However, it was important that countries not slip back into unsustainable debt caused by excessive borrowing, leading to yet another “lending-forgiveness” cycle.

While the draft resolution contained many good provisions, there were also elements which the European Union found difficult to accept, he said.  No consensus had been reached on the draft’s title, which referred to a “debt crisis”, despite agreement that the world was not facing such a crisis and that the text covered a broader subject than external debt.  The European Union intended to revisit that issue next year.

He said that the European Union, concerned about the phrase “cancellation of 100 per cent of the official multilateral and bilateral debt of heavily indebted poor countries”, had reluctantly accepted that paragraph because it was agreed language from a prior resolution, on follow-up to the development outcome of the 2005 World Summit.  The reference to 100 per cent debt cancellation, however, was not in line with the HIPC initiative.  While bilateral efforts beyond HIPC did exist, they were not mandatory and did not represent a 100 per cent cancellation of all debt.

The representative of the United States said that, like the others, he had hoped to join the consensus on omitting the word “crisis” from the resolution’s title, thus, giving due recognition of the fact that the debt position of many countries had improved significantly.  As the largest contributor to various debt relief initiatives, the United States was a leader in providing debt relief, working with other creditors to approve the ending of $88 billion in debt, in 2005 net present-value terms.  It had also engaged in grant-based financing in countries unable to secure adequate funding.

He said that, by using language from previous years that called for “additional measures” to ease the debt situation, the General Assembly risked seeming “unaware” or “ungrateful” for measures already being taken by Member States.  Hopefully, the Committee would produce a more relevant draft next year.  In addition, the word “eligible” should be added before “heavily indebted poor countries” in operative paragraph 12 of the text to ensure that the repetition of unsustainable borrowing behaviour would be avoided.

The representative of New Zealand, speaking on behalf of CANZ ( Canada, Australia, New Zealand) said the group CANZ had joined the consensus because the draft articulated the effort that had gone into assisting heavily indebted countries to improve their previously unsustainable debt positions.  CANZ had, from the beginning, voiced its concern about the phrase “cancellation of 100 per cent of official multilateral and bilateral debt” in operative paragraph 12, but had accepted the proposal to use the agreed language from document A/60/265.

However, the language did not reflect the reality of the HIPC Initiative, the MDRI processes or the role of debt cancellation, he said.  The HIPC Initiative had been put in place to help countries regain control of their debt loads by reducing their indicators to sustainable levels.  The MDRI had been set up to provide 100 per cent multilateral debt cancellation to those countries that had reached the completion point under the HIPC Initiative.  While neither measure in itself either ensured 100 per cent debt cancellation, or precluded the provision of 100 per cent cancellation, it must be understood that creditors were not mandated to provide such relief.

He said CANZ would continue to encourage countries, bilaterally and multilaterally, to improve the debt sustainability of heavily indebted poor countries.  CANZ also noted that the word “crisis” in the draft resolution’s title did not reflect the reality of the current debt situation, nor the scope of the text, which addressed a broad range of issues related to external debt.  CANZ intended to discus the title next year.

The representative of South Africa, speaking on behalf of the “Group of 77” developing countries and China, insisted that there remained a debt crisis among least developed countries as well as low- and middle-income developing countries.  The Group of 77 welcomed the MDRI but noted that although 16 countries were now eligible for debt cancellation, that initiative represented only a beginning.  Indeed, there were more than 30 eligible countries awaiting action.  Until all commitments on debt cancellation had been met, starting with those agreed in the Millennium Declaration -- which called for 100 per cent cancellation for developing countries, particularly in Africa -- debt would remain a “crisis” and the draft’s title would remain as it was.

Action on Draft Resolution

Ms. GOMES ( Portugal) tabled the draft resolution on Commodities (document A/C.2/61/L.56), making minor oral amendments to the text.

The Committee then approved that text without a vote and withdrew an earlier version (document A/C.2/61/L.7).

Explanations of Position

The representative of the United States said that, by joining the consensus, his delegation was reaffirming its commitment to the Doha Development Agenda and to reviving subsequent negotiations towards a strong outcome that would focus on generating new trade flows.

He said the World Trade Organization had a unique and exclusive role to play in determining and interpreting the obligations of its members.  Furthermore, the global community must realize that formal resumption of the World Trade Organization talks required the breaking of the current deadlock and the continuation of efforts to liberalize markets and integrate developing countries into the international trading system.  Indeed, a successful trade round would contribute to the alleviation of poverty, including through market-opening and the boosting of South-South trade.  That would require more than just “picking things up from July”.  Members must move beyond their current positions, especially on agriculture, industrial goods and services.

The representative of the Republic of Korea said much time had been spent on the commodities text and it was pleasing that, after tough negotiations, Member States had managed to come to a consensus.  There was great satisfaction in seeing the restored confidence in a trade-related resolution, and hopefully, that spirit would be retained in the years and months to come.

Action on Draft Resolutions

The representative of Croatia then introduced the draft on the International Year of Forests, 2011 (document A/C.2/61/L.21/Rev.1), describing the proclamation as an additional effort to ensure forest sustainability.  The Year would hopefully strengthen multi-stakeholder dialogue on the issue and promote more public participation.

The Committee then approved the text without a vote.

As the Committee took up the draft on the International Strategy for Disaster Reduction (document A/C.2/61/L.58), its Secretary said that, should the text be approved, there would no financial implications for the regular budget as the secretariat of the International Strategy for Disaster Reduction and the Inter-Agency Task Force for Natural Disaster Reduction, established in 1999 by resolution 54/219, were exclusively financed from extra-budgetary resources.

BENEDICTO FONSECA FILHO ( Brazil), Committee Vice-Chairman, then introduced the draft resolution, which was approved without vote as an earlier version (document A/C.2/61/L.25) was withdrawn.

Explanation of Position

The representative of Iran said his country had joined the consensus and noted that the World Conference on Disaster Reduction and its outcome Framework had been a turning point for building the resilience of nations and communities to disasters, which should be done with respect to all types of disasters without highlighting certain categories.  Iran hoped the secretariat would take note of the language used in the draft, and that next year, all types of natural hazards would be addressed.

The Committee was then informed that the draft on Implementation of the United Nations Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, Particularly in Africa (document A/C.2/61/L.55) was still awaiting evaluation for programme budget implication, and action would, therefore, be taken at a later stage.

Mr. FONSECA FILHO (Brazil) then introduced a draft on Implementation of the outcome of the United Nations Conference on Human Settlements (Habitat II) and strengthening of the United Nations Human Settlements Programme (UN-HABITAT) (document A/C.2/61/L.57), which the Committee approved without a vote, as an earlier version (document A/C.2/61/L.17) was withdrawn.

Explanation of Position

The representative of Finland, speaking on behalf of the European Union and associated States, said she had joined the consensus on the understanding that the UN-HABITAT Governing Council was the Programme’s leading body and that the draft resolution would not prejudge its actions.  The text should not be interpreted as a directive to the Governing Council, which could set its own agenda and consider items in a manner it deemed appropriate.

She noted that operative paragraphs 1 and 3 from the earlier text had been placed in the preambular section of the current version to highlight the fact that the Assembly had not taken any stand on the documents mentioned in those paragraphs.  The European Union looked forward to UN-HABITAT’s sixth-year medium-term plan and emphasized the crucial role the Programme could play in the rapid urbanization now taking place in the developing world.

The representative of Canada expressed his full support for the European Union statement.

Action on Draft Resolution

ABOUBACAR SADIKH BARRY (Senegal), Committee Vice-Chairman, then introduced a draft resolution on Preventing and combating corrupt practices and transfer of assets of illicit origin and returning such assets, in particular to the countries of origin, consistent with the United Nations Convention against Corruption (document A/C.2/61/L.53).

The Committee approved that text, withdrawing an earlier version (document A/C.2/61/L.20).

Explanations of Position

The representative of Finland, speaking on behalf of the European Union and associated States, said the highest priority was placed on preventing corruption and improving transparency and accountability, which were thought to be affecting free trade and the achievement of most Millennium Development Goals.  As the first global anti-corruption instrument, the Convention provided an opportunity for Member States to strive towards asset recovery, among other things.  The ratification and full implementation of the Convention should be a priority for all Member States and the draft would send a strong message in that regard.

She said the European Union looked forward to the next Conference of States Parties, to be held this month in Jordan.  However, the regional body’s members were disappointed that the draft’s title did not more clearly reflect the Convention’s provisions, particularly those relating to asset recovery.  The European Union encouraged the Secretary-General, in compiling his next report, to take advantage of information acquired during the upcoming first Conference of States Parties.

The representative of South Africa, speaking on behalf of the Group of 77 and China, welcomed the draft’s adoption, but noted its “procedural” nature since the Convention had only just entered into force and the Conference of States Parties had not yet taken place.  The Group of 77 would prepare a comprehensive and full resolution during the next session.

The representatives of Canada, United States and Japan each voiced their alignment with the European Union.

As the Committee took up the next draft, on the Third United Nations Conference on the Least Developed Countries (document A/C.2/61/L.64), the representative of Malaysia made minor editorial changes to the text.

PRAYONO ATIYANTO ( Indonesia), Committee Vice-Chairman, then tabled that text, which was approved without a vote, as orally amended, and an earlier version (document A/C.2/61/L.37) withdrawn.

As the Committee turned to the next draft, on the Role of microcredit and microfinance in the eradication of poverty (document A/C.2/61/L.63), the representative of Jamaica made minor oral amendments to the text.

Mr. ATIYANTO ( Indonesia) then submitted that text, which was approved, as orally amended, as the Committee withdrew an earlier version (document A/C.2/61/L.39).

Explanations of Position

The representative of Finland, speaking on behalf of the European Union and associated States, said she was pleased to join the consensus, believing that microfinance was an important tool, and a proven stimulant, of economic growth that had improved the circumstances of poor women and other disenfranchised people.  The Nobel Prize-winning professor, Muhammad Yunus, had brought increased attention to microfinance around the world.

She said the European Union had participated actively in the International Year, including by advancing the dialogue from the level of making small loans to the poor to the larger issue of microfinance, which included a broad range of products.  That move had been critically important, since it touched on 2 billion people without access to financial services.  A dedicated group focused on that issue would soon follow up on initiatives begun during the Year, including by providing data on such services and assessing their quality.  While it was nice to see the concepts of “inclusivity” and references to “microfinance, including microcredit” in the draft resolution, it would have been preferable to see them reflected in the title.

The representative of Switzerland said her country had joined the consensus, and fully supported the European Union statement regarding the need to make the financial sector more inclusive.  The awarding of the 2005 Nobel Peace Prize to the founder of the Grameen Bank reflected the growing importance of microfinance and helped to raise awareness regarding pro-poor financial services.  However, Switzerland was disappointed that the General Assembly had made limited progress in adapting its work to reflect new language, new lessons learned and up-to-date best practices.

The representative of Canada said his country had joined the consensus, believing that microfinance was a powerful tool for reducing poverty among both women and men.  It underpinned the ability of poor people to achieve the Millennium Development Goals on their own terms and in a sustainable way.  Canada had participated actively in the International Year by hosting the Microcredit Summit in Halifax earlier this year.  Microfinance had evolved rapidly from being the simple provision of credit to meeting the need of all people for financial products.

As the Committee turned its attention to the draft on the United Nations University (document A/C.2/61/L.36/Rev.1), GO SHIMADA ( Japan) announced additional co-sponsors.

The Committee then approved that text without a vote.

Mr. SHIMADA (Japan), in a general statement, thanked all Member States for supporting a draft that contained new language in most paragraphs, noting that as the “think tank” of the United Nations system, the University would continue to keep track of the rapid changes taking place in the world.  However, it would need continued support in order to carry out its tasks.  The University’s office in New York had an important role to play in raising more awareness within the United Nations of the institution’s activities.

Finally, the Committee approved, without a vote, the draft decision on Programme planning (document A/C.2/61/L.50), which was submitted by the Chair.

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For information media • not an official record
For information media. Not an official record.