by Mr. Anwarul K. Chowdhury
Nations Under-Secetary-General and High Representative for
the Least Developed Countries,
Landlocked Developing Countries and Small Island Developing
the General Debate
17 June 2004
Ladies and Gentleman,
like to start by thanking wholeheartedly the Government
and the people of Brazil for their hospitality in hosting
this Conference and for making excellent arrangements.
Let me also take this opportunity to convey my deepest appreciation
to my dear colleague Mr. Rubens Ricupero, UNCTAD Secretary-General
and his staff for their excellent work in preparing this
Conference. I would also pay tribute to the wise leadership
that Mr. Ricupero has provided over all these years to UNCTAD.
It has been an honour and pleasure for me to participate
at this major global gathering and interact in various events
in my capacity as the High Representative of the United
Nations working for the three most vulnerable groups of
countries of the world - the Least Developed Countries (LDCs),
Landlocked Developing Countries (LLDCs) and Small Island
Developing States (SIDS).
UNCTAD XI is a milestone, more so as it celebrates the 40th
anniversary of its establishment UNCTAD has always provided
strong support to the cause of the most vulnerable countries
in all it's activities.
Despite professed attention of the international community
during the past years, the fifty most vulnerable countries
of the world - the Least Developed Countries (LDCs) - continue
to be marginalized in the global development process.
While the global volume of official development assistance
to all developing countries has jumped to $68 billion last
year from $52 billion in 2001, the LDC-specific agreed target
for ODA, which is 0.20 per cent of the industrial countries'
GNI, has not yet been reached for most of the donors. And
while international trade can have a powerful role in poverty
reduction in the LDCs, their capacity to benefit from it
remains very weak.
The share of LDCs in world trade at present barely accounts
for 0.4 percent of world trade. For most LDCs, the primary
sector dominates the economy and in commodity-dependent
LDCs, particularly in Africa, the ability of benefiting
from a liberalized international trade regime is especially
being short-circuited by falling and unstable world commodity
Thus, the LDCs' efforts towards the establishment of a fairer
playing field for international trade in agricultural products
are of the utmost importance.
In Cancún, the LDCs and the African agenda had the
removal of huge subsidies that distort agricultural production
and export at their core. The "Cotton Initiative"
was a milestone effort on the part of four very active members
of the LDC group. Cotton is one of the world's most heavily
subsidized crops, especially in the US and European Union.
Cotton figures as a significant export item for at least
20 of the 50 LDCs. Most of these 20 countries - where life
expectancy averages about 50 years, and most of the population
is living on $1 a day or less - are in western and central
Africa. An effective and specific solution within the WTO
negotiations, aimed at the elimination of all forms of export
subsidies, in this very sensitive productive sector, is
thus very urgently needed.
As for market access, in recent years the LDCs benefit from
several arrangements by industrial countries providing their
exports with duty free treatment. The Everything But Arms
scheme of the EU, the African Growth and Opportunity Act
of the United States and special tariff treatment from Canada,
Japan, Switzerland, Norway, Australia, and New Zealand are
well known. Here I would share the good news with you that
last Monday the US Congress extended the AGOA Act by seven
years, up to 2015.
While there are strong indications that some African LDCs
are significantly benefiting from the AGOA or the EBA treatment,
in terms of induced domestic investments and FDIs, in most
cases, the majority of LDCs have not been able to fully
benefit from available trade preferences. The rate of utilization
of preferential schemes remains very low. Among many factors
explaining such low rate of utilization, supply capacity
constraints, lack of investment and the stringency of the
rules of origin attached to such schemes are the most prominent.
I strongly propose that urgent action be taken to make the
rules of origin more realistic, taking into consideration
the industrial and productive capacity of the LDCs. In this
context, I welcome the statement by the Minister of Ireland
on behalf of the EU that, as of 2006, a revised set of rules
of origin would be ion place to assist the LDCs.
In the context of both WTO trade negotiations and the implementation
of the preferential market access schemes, UNCTAD has an
important role to play in strengthening its programmes of
trade-related technical assistance aimed at building the
capacity in LDCs to effectively participate in the global
negotiating rounds and to benefit from preferential trade
Enhanced South-South cooperation has the potential of playing
a significant role in promoting sustained growth and sustainable
development for LDCs. In an increasingly globalized and
interdependent world, we can in fact already talk of a "new
geography of trade". After all, only 42 per cent of
LDC exports enter industrial country markets, while nearly
50 per cent is directed to other developing countries. More
advanced developing countries should consider expansion
of their non-reciprocal preferential system for imports
In this context, I very much welcome the launching, by the
Argentine and Brazilian Ministers yesterday of the third
round of negotiations to expand the Global System of Trade
Preferences (GSTP) - an agreement on tariff reduction and
trade liberalization among developing countries. At least
40 more countries will join the existing 44 parties in this
new round. This is a wonderful opportunity for revitalizing
this instrument of South-South collaboration in a manner
that reflects the differentiated responsibilities of developing
countries and their levels of development. I would therefore
urge the LDCs to take a very active role in these negotiations
in order to avoid marginalization in the South-South trade.
Another area that I would like to underscore here and where
I have called the attention of the LDCs is the forthcoming
phase-out of the 30-year-old Multi-Fibre Arrangement (MFA).
This development could have profound implications for them.
The removal of MFA quotas will certainly imply changes in
the location of the industry, with more direct competition
to supply the world markets, and concentration of the industry
in a smaller number of low cost locations. The relative
competitiveness of LDCs, combined with the continued preferential
market access enjoyed by these countries from industrial
countries, will determine the extent to which LDCs are prepared
to take advantage of the removal of MFA next year. I would
therefore strongly urge policy-makers in LDCs to anticipate
these changes linked to the MFA phase-out and design appropriate
strategies to attract investments in the textile and garment
industries, including through expanded South-South cooperation
arrangements with special attention to LDCs.
I would also bring to your attention that the specific development
concerns and needs of the LDCs, as embodied in the Brussels
Programme of Action, will be at the center of the international
community's attention at the forthcoming High-Level Segment
of the United Nations Economic and Social Council in New
York from 28 to 30 June. The discussions will focus on the
theme of resources mobilization and enabling environment
for poverty eradication for the Least Developed Countries.
The report on this theme will be presented by Secretary-General
Kofi Annan with the participation of the LDC group's leader
President Kerekou of Benin.
As we approach the stock-taking of progress towards the
Millennium Development Goals in 2005, it is even more urgent
for the international community to focus on the enormous
development challenges facing the 50 LDCs. Today, the population
of these countries stands at 736 million people, more than
11 per cent of the world population. By 2015, it is projected
to reach 942 million people. This means that between now
and 2015, when the Millennium Development Goals are expected
to be met, there will be 206 million people more living
in the LDCs and this makes our challenge even more daunting.
Finally, let me take this opportunity to stress the importance
of giving the deserved recognition to the special treatment
for the Landlocked Developing Countries and the Small Island
Developing States. The Almaty Programme of Action, adopted
by the international community in August 2003, recognized
that the main reason for the marginalization of landlocked
developing countries from the international trading system
is high trade transaction costs caused by geographical handicap
of landlockedness and remoteness from major world markets.
International trade issues feature also prominently in the
preparatory process leading to the International Meeting
for the 10-year review of the Barbados Programme of Action
for the Small Island Developing States, which will take
place in Mauritius in January 2005.
I would like to conclude by sharing my conviction that the
resulting document of UNCTAD XI, that will be formally adopted
tomorrow, will realize progress for dealing more effectively
with the complex link between trade and development for
the benefit of these most vulnerable countries of the world.
Copyright © United Nations,2002-2004. OHRLLS, Room UH-900,
New York, NY 10017, U.S.A.
Telephones: (212) 963-7778 or (212) 963-5051 Fax: (917) 367-3415