Make Trade Work For The Poor: Position paper on UNCTAD, on the occasion of its Tenth Conference in Bangkok, February 2000 | World Trade Organization

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Position paper on UNCTAD, on the occasion of its Tenth Conference in Bangkok, February 2000. There is an urgent need for UNCTAD to take a lead in promoting new approaches to development that favour poorer people and countries - in part because of the failures of today's international economic managers. Many governmental organisations still do not put human development at the heart of their policy-making, and place excessive faith in economic liberalisation as the answer to all ills. However, the weakening of the 'Washington consensus' creates opportunities for UNCTAD to influence development thinking. At the same time, the WTO and IMF have lost a measure of legitimacy and credibility, giving UNCTAD the chance to recover a more dynamic institutional as well as intellectual role. This should encompass direct support to developing countries, along with a contribution to the reorientation of powerful global institutions towards the pursuit of sustainable and equitable development.
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    Make trade work for the poor     As we enter a new millennium, we must make trade work for the poor. We must show sensitivity to the needs and concerns of the weaker partners in the global trading system . Kofi Annan, United Nations Secretary General   Position paper on UNCTAD, on the occasion of its Tenth Conference in Bangkok, February 2000 For further information, please contact Michael Bailey, Oxfam GB Policy Department Tel no: +44 1865 312494,   or Email: <mbailey@oxfam.org.uk>. During UNCTAD X, please telephone +44 780 8953524.  Make trade work for the Poor    Summary   There is an urgent need for UNCTAD to take a lead in promoting new approaches to development that favour poorer people and countries – in part because of the failures of today’s international economic managers. Many governmental organisations still do not put human development at the heart of their policy-making, and place excessive faith in economic liberalisation as the answer to all ills. However, the weakening of the ‘Washington consensus’ creates opportunities for UNCTAD to influence development thinking. At the same time, the WTO and IMF have lost a measure of legitimacy and credibility, giving UNCTAD the chance to recover a more dynamic institutional as well as intellectual role. This should encompass direct support to developing countries, along with a contribution to the reorientation of powerful global institutions towards the pursuit of sustainable and equitable development. Oxfam believes UNCTAD’s distinctive contribution to the achievement of the 2015 development targets should be: ã To act as forum for developing-country governments to share ideas on ‘pro-poor’ economic development strategies, and to build political consensus; ã To carry out research on key economic issues from a development perspective, with a strong focus on distributional issues; ã To provide technical assistance and capacity building services; ã To address issues relating to TNCs, given their power in world markets. It may not be appropriate for UNCTAD to become a framework for negotiating binding international agreements. However, we believe UNCTAD should seek to be as ‘propositional’ as possible in its areas of expertise, resisting the pressure from some industrialised countries to limit it to a more passive and technical role.  UNCTAD can act as a political counterweight to the WTO and help developing countries promote reform of trade agreements. The Secretariat can monitor and evaluate agreements, as well as provide technical back-up to members. The Bangkok conference provides an opportunity for the rich countries to rebuild their dialogue with the South, though this requires real concessions on issues of substance, such as access to Northern markets. Oxfam proposes that UNCTAD’s work programme focus on the following policy issues: ã Trade policy, particularly market access for developing countries ã Investment regulation ã Closing the ‘knowledge gap’ ã Stabilising commodity and financial markets ã Financing development, with a focus on national and international taxation ã TNCs (an issue that cuts across all the others) To be an effective advocate for equitable development, UNCTAD need partners and allies. It will have to count on solid backing from its developing country membership, as well as from the more enlightened industrialised countries. This support must be financial as well as political . 1  UNCTAD could also benefit from more consistent support from NGOs - the proposals from Rubens Ricupero regarding civil society participation in the work of UNCTAD are a welcome step towards this. 1. Why UNCTAD is needed In the coming years, there is both a need and an opportunity for UNCTAD to take a lead in promoting new approaches to development that favour poorer people and countries. The persistence of mass hunger, and the lack of progress towards the 2015 international development targets, are grounds enough for making UNCTAD into an effective advocate for development. However, the arguments for a strong UNCTAD are reinforced by the failures of today’s international economic managers. Many governments and inter-governmental organisations still do not place human development and poverty reduction at the heart of their policy making. There is excessive faith in economic liberalisation as the key to growth, and a presumption that growth will automatically provide jobs and incomes for people in poverty. This faith has been shaken by the emergence of international financial instability, and by the recognition that liberalisation does produce losers as well as winners. As a result, the need for regulation and ‘growth with equity’ is becoming part of official discourse, even though the management of the international economy remains firmly rooted in narrow commercial concerns. This weakening of the so-called ‘Washington consensus’ creates opportunities for UNCTAD to influence development thinking and to promote alternative policies.  At the same time, the institutions charged with administering the world economy have lost a measure of legitimacy and credibility. The IMF has been widely criticised for its handling of the East Asia crisis, and for its subordination to US economic interests. The WTO has found it hard to deal with the conflicting interests of its members, and the pressure from the public for trade rules to incorporate social and environmental considerations. The developing countries, while often not of one mind on economic policies, are united in demanding a greater say in multilateral rule-making. In this context, UNCTAD has the chance to recover a more dynamic and pro-active institutional as well as intellectual role, comparable to that played in the 1960’s and 1970’s. This revitalised role encompasses direct support to developing countries, along with a contribution to the reorientation of powerful global institutions, such as the WTO and IMF, towards the pursuit of sustainable and equitable development. 2. UNCTAD’s distinctive competence ã UNCTAD is a unique forum for developing-country governments to share ideas on ‘pro-poor’ economic development strategies, and to build the political consensus that is necessary for their effective intervention in multilateral decision-making.   ã UNCTAD can carry out vital research on trade, investment and wider socio-economic issues, to help countries achieve equitable and sustainable growth. In this context, it could examine the appropriate balance between liberalisation and regulation, and the ‘flanking measures’ needed to ensure that more open economies generate positive outcomes for    those in poverty. Distributional issues, especially within countries, should be a central feature of this policy work.   ã UNCTAD can also provide technical assistance and capacity building services in the economic policy field for developing countries, particularly for the least-developed. This should include enhancement of the negotiating capacity of poorer states in multilateral forums. These functions should not become the preserve of the World Bank and WTO. ã UNCTAD should expand its work programme on transnational corporations, given their enormous weight in world markets. UNCTAD has a unique role in monitoring the impact of TNCs, drawing up regulatory proposals from a development perspective, and helping developing countries in their dealings with companies. 2    All these functions should be defined with explicit reference to human development goals, and their success judged by their contribution to the 2015 international development targets. It may not be politically feasible, or indeed desirable, for UNCTAD to become a framework for negotiating binding international agreements on economic matters. However, we believe UNCTAD should seek to be as ‘propositional’ as possible in its areas of expertise, resisting the pressure from some industrialised countries, including the EU, to limit it to a more passive and technical role in analysis and capacity building . 3. UNCTAD’s role in relation to the WTO The WTO has so far failed to put development in the forefront of its concerns, despite the rhetoric of the principal trading nations. UNCTAD can act as a political counterbalance to the WTO and play a major part in promoting WTO reform. Developing countries are particularly concerned to address the implementation issues arising in existing WTO agreements, and to restore the vital principal of ‘special and differential treatment’ for poorer economies. Many also believe that this is not an appropriate moment to expand the WTO agenda, especially since agriculture and services are already scheduled for negotiation. Following the failure of the Seattle Ministerial Conference, UNCTAD X in Bangkok will provide a space for developing-country governments to review their strategy and tactics in relation to the WTO, and to develop proposals for institutional reform which will guarantee them a stronger voice in any new talks. It also provides an opportunity for the industrialised countries to rebuild their dialogue with the South, though this requires real concessions on issues of substance, such as access to Northern markets. Oxfam believes that unless the rich countries immediately deliver on the proposal for tariff and quota-free access for the least developed countries, any claim that the WTO is pro-development will ring extremely hollow . In this context, it is particularly regrettable that the USA is only sending a low-level delegation to Bangkok. UNCTAD could undertake reviews of the impact of the Uruguay Round. This would look at the social, economic, environmental effects of the agreements, with particular emphasis on disaggregating national data in order to see the differential impact on sub-regions and disadvantaged social groups, and by gender. UNCTAD could help monitor the implementation of WTO rules, such as those covering dumping, subsidies, intellectual property, trade-related investment measures, etc. This would strengthen the position of the many developing countries that rightly wish to revise these agreements. This would also enable UNCTAD to better inform developing countries of the opportunities to defend their interests under present WTO rules, e.g. by using provisions for compulsory licensing of medicines under the TRIPS agreement. UNCTAD could also step up its capacity building on WTO issues, prioritising the least-developed countries. This assistance should be aimed at helping countries to understand the development dimension of subjects under discussion, and to be more effective negotiators. 3
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