Secretary-General Stresses Importance of Diversification, Agriculture, Trade

 

at General Assembly Debate on Investment in Least Developed Countries

 

Following are UN Secretary-General Ban Ki-moon’s remarks to the General Assembly informal thematic debate on “Investment in and financing of productive capacities of least developed countries”, in New York, 11 March:

Let me begin with a word on this morning’s events.  The world has been shocked and saddened by the images coming from Japan.  I want to offer my deepest sympathies and heart-felt condolences to the Japanese people, especially those who have lost family and friends in the earthquake and subsequent tsunamis.

Japan has long been one of the UN’s most generous benefactors, coming to the assistance of those in need the world over.  In that spirit, the United Nations stands by the Japanese people at this very difficult time, ready to help in every way possible.

The world’s least developed countries (LDCs) have a special claim on our generosity and our energies.  In 1971, there were 25 least developed countries.  Now there are 48.  Three quarters of their populations live on less than $2 a day, more than half on less than $1.  The challenges to their health, well-being and development are profound.

Nonetheless, the situation is not as bleak as it sounds.  Poverty has declined in the past two decades.  In recent years, the least developed countries experienced high rates of gross domestic product (GDP) growth — driven largely by global expansion.  This meeting — and especially the upcoming Fourth United Nations Conference on the Least Developed Countries in Istanbul — are important opportunities to explore how to consolidate and accelerate progress.

I would like to raise three issues for your attention today.  First, diversification.  Many LDC economies are heavily based on subsistence agriculture and extractive mining.  Few have managed to diversify or add value to their products before export.  This makes them highly vulnerable to swings in commodity prices and other upheavals.

Economic diversification has been on the LDC agenda since the Paris Plan of Action was adopted in 1981.  Trading partners have come forward with some measures to facilitate market access.  Donors have provided substantial official development assistance (ODA).  Resources for Aid for Trade have increased to almost $40 billion a year, though least developed countries receive only about a quarter of this.

Least developed countries need more support and it needs to be more effectively targeted.  Important as it is, ODA is not the only means for least developed countries to achieve their development objectives.  Domestic resource mobilization and South-South cooperation have an important role.  So does the private sector.  Ultimately, enhanced productive capacity will only be achieved with a dynamic and thriving private sector.

The private sector task force of the LDC Conference is a welcome platform for businesses to demonstrate leadership and build the markets of the future.  To achieve this, they will need the support of LDC Governments to create the necessary enabling environment.  The donor community can support this through much-needed aid, foreign direct investment and technical assistance.

To generate growth and strengthen the resilience of their economies, least developed countries need more investment to improve their capacity in agriculture, manufacturing, services and other productive sectors.  Of these sectors, perhaps the most important sector is agriculture.

This brings me to my second point.  For too long now, we have ignored investments in agriculture.  In the past decade, the cost of importing food in least developed countries has tripled.  Global food prices have just reached record levels, and least developed countries face a real prospect of a new food crisis.  Millions of people have been pushed into poverty by the latest food price rises.

I am especially concerned about the poorest households that often spend three quarters of their income on food.  They have no buffer.  When prices go up, they go hungry.  Women and children are the worst hit.  My High-Level Task Force is coordinating responses by the United Nations system to respond to immediate needs, build up local food markets and stimulate increased production.

We need to invest more in sustainable agriculture, especially in smallholder farmers and the infrastructure they need.  This is important, both for food security and competitiveness in international markets.  It means transferring appropriate technologies.  And it means investing in climate change adaptation and mitigation, as well as in the ecosystem services that underpin agriculture.

My Panel on Global Sustainability is looking at all these areas in preparation for next year’s United Nations Conference on Sustainable Development in Rio.  We need to connect the dots between poverty, climate change, energy, food and water.  We also need to deliver on the development objectives of the Doha Round of trade negotiations.

This is my third point.  Least developed countries need to grow food and other commodities, manufacture products and develop other services.  But they also need to be able to trade fairly in the global marketplace.  The international community has failed to follow through on global commitments enshrined in the Monterrey Consensus and the Doha Declaration on Financing for Development.  I call again for a successful conclusion to the Doha Development Round of multilateral trade negotiations.  Aid for Trade is vital, but will do little good if global markets are blocked or intrinsically unfair.

A true partnership for development means a combination of investment, trade, aid, debt relief and global economic governance reforms.  We must make the most of the Istanbul Conference to respond to the plight of the world’s most vulnerable people and meet the Millennium Development Goals deadline.

We need a programme of action for the next decade that emphasizes sustained and inclusive economic growth, improved productive capacity and a structural transformation that will generate jobs — especially for the vast and growing population of young people.  That programme must also help least developed countries to build resilience against internal and external shocks, and meet new and emerging challenges.  And most importantly, that programme must be concrete and results-oriented so that all stakeholders can be held mutually accountable.

I am pleased to report that the United Nations system is making good progress on developing an integrated implementation framework to help us uphold our commitments.  I count on all other partners — least developed countries, their development partners and the multilateral system — to uphold their end of the bargain.

I wish you a successful meeting and I look forward to seeing you in Istanbul.

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