DRAFT TEXT CALLING FOR DURABLE SOLUTION TO EXTERNAL DEBT PROBLEM OF DEVELOPING COUNTRIES INTRODUCED IN SECOND COMMITTEE

3 November 1995

Press Release
GA/EF/2695

DRAFT TEXT CALLING FOR DURABLE SOLUTION TO EXTERNAL DEBT PROBLEM OF DEVELOPING COUNTRIES INTRODUCED IN SECOND COMMITTEE

19951103 Consideration of Environment and Sustainable Development Issue Concluded

The General Assembly would urge creditor countries, multilateral institutions and commercial banks to ensure that the debt strategy, as embodied in Assembly resolutions, be fully taken into account in the implementation of measures towards a durable solution to the external debt problem of developing countries, under one of two draft resolutions introduced in the Second Committee (Economic and Financial) this morning.

Sponsored by the "Group of 77" developing countries and China, and by the Movement of Non-Aligned Countries, the draft would have the Assembly recognize that a durable solution to the debt problem would have a substantial impact on sustaining the strength of the global economy and that a once-and- for-all approach to solving that problem would enable the international community to achieve such a solution.

By the 26-operative paragraph text, the Assembly would stress that besides the external debt issue, the question of globalized financial flows should be placed at the forefront of the dialogue between the United Nations system and the Bretton Woods institutions. The need to encourage private flows to developing countries while reducing the systemic risk of volatility, particularly in portfolio flows, would be underscored. In addition, developed countries would be urged to phase out subsidies for their uncompetitive industries, particularly agriculture, and dismantle protectionist barriers targeted at developing countries.

Also sponsored by the Group of 77 and China, a draft resolution on the Convention on Biological Diversity would have the Assembly welcome the results of the first meeting of its Conference of the Parties, held last December, and invite its Executive Secretary to report on the results of the second meeting, to be held in Jakarta from 6 to 17 November.

The draft resolutions were introduced by representatives of the Philippines.

Second Committee - 1a - Press Release GA/EF/2695 23rd Meeting (AM) 3 November 1995

Also this morning, the Committee concluded its consideration of environment and sustainable development.

The representative of Mexico said the 1997 special session of the General Assembly to review the implementation of Agenda 21 should identify the causes of the impediments to the full realization of the Rio commitments [undertaken during the 1992 United Nations Conference on Environment and Development (UNCED) in Rio de Janeiro]. He added that Agenda 21 should not be watered down.

The special session, the representative of Brazil said, should be guided by the need to improve international cooperation, and not the idea of shrinking the scope of Agenda 21 commitments which continued to be adequate. What was lacking was political will to fulfil the obligations agreed to during UNCED, specifically on matters relating to transfer of technology and allocation of financial resources.

The Executive Secretary of the Intergovernmental Negotiating Committee for a Convention to Combat Desertification and Drought, Arba Hama Diallo, also spoke.

On other matters, the Committee decided to request its Chairman, Goce Petreski (The former Yugoslav Republic of Macedonia), to send a letter to the Chairman of the Fifth Committee (Administrative and Budgetary) asking that extrabudgetary resources be made available to developing countries not members of the Commission on Sustainable Development so they could participate in the meetings of the Intergovernmental Panel on Forests.

Due to the unavailability of documentation the Committee decided to defer from 6 November until 15 November its consideration of agenda items relating to the United Nations Framework Convention on Climate Change and to the Barbados Global Conference on the Sustainable Development of Small Island Developing States.

The Committee will meet again at 10 a.m. on Tuesday, 7 November, to begin consideration of operational activities for development of the United Nations system.

Committee Work Programme

The Second Committee (Economic and Financial) met this morning to conclude its consideration of environment and sustainable development. (For background information, see Press Release GA/EF/2690 of 30 October.)

The Committee was also scheduled to hear the introduction of two draft resolutions, one on the external debt problem of developing countries, the other on the Convention on Biological Diversity.

Drafts for Introduction

The 26-operative paragraph draft text concerning a durable solution to the external debt problem of developing countries (document A/C.2/50/L.7) is sponsored by the Philippines, on behalf of the "Group of 77" developing countries and China, and by Colombia, on behalf of the Movement of Non-Aligned Countries.

By the draft, the Assembly would recognize that a comprehensive, effective, equitable and durable solution to the external debt problem of developing countries would have a substantial impact on sustaining the strength of the global economy and would greatly contribute to efforts of developing countries to achieve sustained economic growth and sustainable development. It would also be recognized that a once-and-for-all approach to the debt problem of developing countries would enable the international community to achieve such a solution.

Under the text's provisions, the international community, particularly creditor countries, multilateral institutions, commercial banks and other lending institutions would be urged to ensure that the debt strategy evolved through the years, and as embodied in various General Assembly resolutions, be fully implemented and taken into account in carrying out various measures aimed at contributing to the durable solution of that external debt problem.

Also by the draft, the international community, including the United Nations system, the Bretton Woods institutions and the private sector would be called upon to take urgent measures and action for the implementation of the commitments, agreements and decisions of United Nations development-related conferences in order to cancel or reduce substantially the debt and the debt- service burden of developing countries, particularly African and least developed countries. The international community would also be called on to build upon the momentum gained from the various meetings that addressed the debt problem in drawing up an agenda for development to further promote a durable solution to that problem.

Second Committee - 3 - Press Release GA/EF/2695 23rd Meeting (AM) 3 November 1995

Innovative approaches would be required, including formal debt cancellation, to address the multilateral debts of debt-distressed developing countries with a high proportion of such debt, particularly low-income countries. Further mechanisms for review of rescheduled debts and debt services aimed at providing additional flexibility to debt-distressed developing countries would be needed to ensure their ability to reverse deteriorating economic and social conditions.

The need for existing facilities to provide debt-relief measures through various debt conversion programmes, such as debt-for-nature swaps and debt- for-child development swaps, to be broadly implemented and expanded to include more debt-distressed developing countries would also be stressed under the draft's terms, as would the need to explore innovative approaches to tackle the debt problem in line with the objectives of the Copenhagen World Summit for Social Development.

The need for multilateral financial institutions and development banks to maintain sufficient and sound credit standing would be recognized, and those institutions would be called upon to adopt flexible terms for the repayment of developing countries' debt. The Managing Director of the International Monetary Fund (IMF) would be called upon to devise concrete policy measures and actions to address properly and in a timely manner the problems faced by debt-distressed developing countries.

Besides the issue of the external debt of developing countries, the question of globalized financial flows should be placed at the forefront of the dialogue between the United Nations system and the Bretton Woods institutions, according to the draft. It would underscore the need to encourage private flows to developing countries while reducing the systemic risk of volatility, particularly portfolio flows. Developed countries would be urged to lower their long-term interest rates, phase out subsidies for their uncompetitive industries, particularly agriculture, and dismantle protectionist barriers targeted at developing countries.

Sponsored by the Philippines, on behalf of the Group of 77 and China, a draft resolution on the Convention on Biological Diversity (document A/C.2/50/L.8) would have the Assembly welcome the results of the first meeting of the Conference of the Parties to the Convention, concluded in Nassau in December 1994, and invite its Executive Secretary to report on the results of the second meeting, to be held in Jakarta from 6 to 17 November. It would take note of the results of the first meeting of the Subsidiary Body on Scientific, Technical and Technological Advice, held at the headquarters of the United Nations Educational, Scientific and Cultural Organization (UNESCO) in September and call upon States to expedite their internal procedures of ratification, acceptance or approval of the Convention.

Second Committee - 4 - Press Release GA/EF/2695 23rd Meeting (AM) 3 November 1995

Statements Made

ULISES CANCHOLA (Mexico) said he believed that the 1997 special session of the General Assembly to review Agenda 21 should provide the opportunity for reflection on substantive and institutional issues. The session should determine the allocation and coordination of activities relating to the protection of the environment among those organs of the United Nations system concerned with environmental matters. The outcome of the special session should be a political statement defining parameters for implementing the Agenda's goals.

Agenda 21 should not be watered down, and there should not be a shift in the burden of implementing its commitments. It would be pointless, he added, to repeat ideas already expressed at the United Nations Conference on Environment and Development (UNCED). The purpose of the special session should be to identify the causes of the impediments to the full realization of the Rio commitments and what could be done to achieve sustainable development.

SERGIO FLORENCIO (Brazil) said the starting point for the review process lay in the principles and concepts embodied in the Rio Declaration [adopted at the 1992 UNCED] which were their guide. The 14 principles set out in that document were a benchmark for international cooperation. Agenda 21 commitments continued to be adequate, he said, adding that lacking was the political will to fulfil the obligations agreed to during the UNCED, specifically matters relating to transfer of technology and allocation of financial resources.

At the Assembly's 1997 review process, delegations should be guided by the need to improve international cooperation, and not the idea of shrinking the scope of Agenda 21 commitments. A positive exercise must be sought, with the outcome resulting in a real global partnership. The goal should also be to cope with the challenges of ensuring sustainable development and the conservation of the environment for future generations.

It was too early, he said, to define a format for the Assembly's special session. Priority should be given to the implementation of major United Nations conventions on climate change, biological diversity and desertification. The role of the Commission on Sustainable Development should be carefully examined with the goal of strengthening its important mandate.

He said groups which played a major role during UNCED should be involved in the review process and its preparatory phase. The regional commissions should also play a more active role and the necessary means should be given them to prepare a very relevant part of the work.

Second Committee - 5 - Press Release GA/EF/2695 23rd Meeting (AM) 3 November 1995

ARBA HAMA DIALLO, Executive Secretary of the Intergovenrmental Negotiating Committee for a Convention to Combat Desertification and Drought, said that so far 115 countries had signed the Convention while 14 others had ratified it. He invited more signers and ratifiers to ensure early entry into force of the Convention which required 50 ratifications for that purpose. He said the secretariat was prepared to provide interested States with the relevant information about the Convention.

He said a number of regional activities including seminars were planned on the Convention and commended Spain, Switzerland, the Netherlands, Denmark and Japan among others for providing the finances for them.

Introduction of Drafts

LIBRAN N. CABACTULAN (Philippines), on behalf of the "Group of 77" developing countries and China, introduced a draft resolution entitled "Enhancing international cooperation towards a durable solution to the external debt problem of developing countries".

CECILIA BALTAZAR REBONG (Philippines), also on behalf of the Group of 77 and China, introduced a draft entitled "Convention on Biological Diversity".

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