CONFERENCE ON SOUTH-SOUTH COOPERATION CALLED FOR BY DEVELOPING COUNTRIES, AS SECOND COMMITTEE DEBATES ECONOMIC, TECHNICAL COOPERATION

Press Release
GA/EF/2696

CONFERENCE ON SOUTH-SOUTH COOPERATION CALLED FOR BY DEVELOPING COUNTRIES, AS SECOND COMMITTEE DEBATES ECONOMIC, TECHNICAL COOPERATION

Speakers Say Conference Would `Reinvigorate' International Support; Under-Secretary-General Briefs Committee on Review Session for Agenda 21

Developing countries this morning again reiterated their call for a global conference on South-South cooperation, as the Second Committee (Economic and Financial) began debate on economic and technical cooperation among those countries.

The representative of the Philippines, speaking on behalf of the "Group of 77" developing countries and China, said such a conference would be a key means towards reinvigorating international support for South-South cooperation, as well as an opportunity to chart courses of action beneficial to the entire international community. The international community should commit itself to supporting South-South cooperation, particularly in terms of providing adequate resources.

The representative of Japan said his country was considering expanding the Japan-United Nations Development Programme Human Resource Development Fund as a way to foster new approaches to technical cooperation among developing countries, such as triangular cooperation. He said it would be helpful if an effective facility for promoting South-South cooperation were established within UNDP, such as an open trust fund supported by interested parties. Japan attached more importance than ever to supporting South-South cooperation, he added.

The Director of the Special Unit for Technical Cooperation Among Developing Countries, United Nations Development Programme (UNDP), Denis Benn, introducing the reports of the Secretary-General, said South-South economic and technical cooperation was relevant to all sectors of development and should form an integral part of overall development strategies.

Also making statements in the debate were the representatives of the Marshall Islands, Nepal, China, Thailand and Indonesia.

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Also this morning, the representative of the Philippines, on behalf of the "Group of 77" developing countries and China, introduced a draft resolution on the challenges and opportunities of global financial integration.

Under the draft's provisions, the Assembly would recognize the need for a stronger and central role for the International Monetary Fund (IMF) in surveillance, in particular of industrialized countries, to enhance transparency and predictability in international financial markets. The objective of promoting greater transparency, openness and enhanced participation by developing countries in the Fund's work would be reaffirmed, and the important contribution that the United Nations could provide in that regard would be recognized.

In addition, the Under-Secretary-General for Policy Coordination and Sustainable Development, Nitin Desai, briefed the Committee this morning on matters related to the 1997 special session of the General Assembly to review the implementation of Agenda 21, the programme of action adopted by the 1992 United Nations Conference on Environment and Development. He welcomed the calls for the preparatory process for the special session to begin soon, adding that the Secretariat had already started activities in that regard. The special session was not intended to repeat the Rio conference, he added, stressing the need to involve all the major players of the UNCED process in the review of Agenda 21.

The Committee also observed a minute of silence in memory of the Prime Minister of Israel, Yitzhak Rabin.

The Second Committee will meet again at 3 p.m. today to continue its consideration of economic and technical cooperation among developing countries.

Second Committee Work Programme

The Second Committee (Economic and Financial) met this morning to begin consideration of operational activities for development covering the triennial policy review of such activities and economic and technical cooperation among developing countries. The Committee has before it a number of documents submitted by the Secretary-General on the subject, including reports on national execution of projects, a meeting of the High-Level Committee on Technical Cooperation among Developing Countries, and the status of South-South cooperation. Also this morning the Committee would hear a briefing by the Under-Secretary-General for Policy Coordination and Sustainable Development, Nitin Desai, on the 1997 special session of the Assembly to review the implementation of Agenda 21.

A report of the Joint Inspection Unit (JIU) contained in a note by the Secretary-General (document A/50/113), analyses various problems encountered in the application of the modality for national execution of projects and delineates the respective roles of governments, the United Nations Development Programme (UNDP) as a major funding agency, and the specialized agencies. The report was based on replies to a questionnaire by a number of governments, UNDP and specialized agencies, as well as field investigations and discussions with, among others, UNDP resident representatives and government officials.

The Administrative Committee on Coordination (ACC), in a report transmitted by the Secretary-General (document A/50/113/Add.1), says it supports the general thrust of the conclusions and recommendations of the JIU and fully agrees that much should be done to improve national project execution.

Another report of the Secretary-General (document A/50/39) gives an account of the ninth session of the High-Level Committee on the Review of Technical Cooperation among Developing Countries, held in New York from 30 May to 2 June. The Committee adopted a number of decisions on progress made in implementing the 1978 Buenos Aires Plan of Action, including new directions for technical cooperation among developing countries and the overall framework for its promotion and application.

The Secretary-General's report on South-South cooperation (document A/50/340) assesses the state of institutional arrangements, cooperation in the trade, monetary and financial fields, and the state of other priority functional areas among developing countries. An addendum to the report (document A/50/340/Add.1) discusses the policy commitment to and activities in South-South cooperation by United Nations organizations and agencies.

South-South cooperation refers to bilateral and multilateral relations

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involving governments, institutions, corporations, individuals and non-governmental organizations of two or more developing countries in the same region or in more than one region. The report states also that sub-regional and regional cooperation and integration are emerging as the central pillar of the revival in cooperation among developing countries and that new integration organizations are being created and existing ones strengthened and extended.

In Africa, integration institutions are being strengthened under new treaties while an innovative form of cooperation -- sub-regional growth zones -- created in the Asian and Pacific region, is helping to generate production of exportable products at competitive prices, according to the report. In Oceania, the island countries and interested development partners have established a number of regional organizations. In Latin America and the Caribbean, a strong movement is under way to develop fresh approaches and modalities to streamline integration processes. There have also been a number of initiatives which are creating a network of free trade and wider integration arrangements in the Americas.

The report goes on to state that at the global level, developing countries are coordinating efforts through the Non-Aligned Movement and the Group of 77 to speak with one voice and to enhance their bargaining power. In addition to serving as agents for international negotiations, the two groups have adopted economic cooperation programmes which are being implemented with varying degrees of success.

Also before the Committee for introduction is a draft resolution entitled "Global financial integration: challenges and opportunities" (document A/C.2/50/L.6), sponsored by the Philippines on behalf of the "Group of 77" developing countries and China.

Under its provisions, the Secretary-General would be requested to report to the Assembly on the globalization of private capital flows including its effects on developing countries. The report should contain recommendations on measures necessary for promoting a stable financial environment conducive to sustained economic growth. It should be prepared in cooperation with the Bretton Woods institutions and the United Nations Conference on Trade and Development (UNCTAD) and submitted through the Economic and Social Council.

Stressing that global financial integration presents new challenges and opportunities for the international community and should be placed at the forefront of the dialogue between the United Nations system and the Bretton Woods institutions, the Assembly would underscore the need for encouragement of private flows to developing countries while reducing the systemic risk of volatility, particularly in portfolio flows. The Assembly would recognize the need for a stronger and central role for the International Monetary Fund (IMF) in surveillance, in particular of industrialized countries, with a view to enhancing transparency and predictability in international financial markets

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and promoting economic growth. The objective of promoting greater transparency, openness and enhanced participation by developing countries in the Fund's work would be reaffirmed, and the important contribution that the United Nations can provide in that regard would be recognized.

Briefing by Under-Secretary-General

NITIN DESAI, Under-Secretary-General for Policy Coordination and Sustainable Development, said the 1992 United Nations Conference on Environment and Development (UNCED) had been pathbreaking in many ways, including in the degree of media interest, the participation of non- governmental organizations and the range and breadth of its substantive agreements. The challenge before the special session to review Agenda 21, UNCED programme of action, would be of similar caliber. It would be the first five-year evaluation of a major development-related United Nations conference. Commenting on statements made before the Committee on the matter, he welcomed calls for the preparatory process for the special session to begin earlier than scheduled. He said the Secretariat had already started activities in that regard.

The follow-up to Rio did not take place only in the Commission on Sustainable Development, he continued, but a great deal was happening in other bodies as well. Agenda 21 had been internalized in other organizations of the United Nations system, and several had established sustainable development departments. How those other bodies would contribute to the special session was a matter that the Committee should also address. Another dimension that should be considered was the input of other conferences held after Rio, and also how the Economic and Social Council would fit in that process.

The Committee must also consider the question of facilitating participation of non-governmental organizations in the review process and the preparations to it, Mr. Desai continued. He drew attention to activities outside the intergovernmental set-up, which had been effective in implementing Agenda 21. How were those activities going to be reflected in the review process? he asked. A positive feature of the follow-up to Rio had been implementation at the national level, which included the preparation of national Agendas 21. Thus, the participation of local level authorities in the review process must be taken into account. It was not possible to repeat the Rio conference and that was not the intention. The outcome and the preparations for the special session should be a bit more low key than the Rio event, but all the major players in the UNCED process must be involved.

Economic cooperation among developing countries

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DENIS BENN, Director of the Special Unit for Technical Cooperation Among Developing Countries (SU/TCDC), UNDP, introducing the reports of the Secretary-General on the subject, said South-South economic and technical cooperation was relevant to all sectors of development and should form an integral part of overall development strategies. It was also an important strategy for ensuring the effective participation of the developing countries in the new international trading system, particularly in the case of the smaller developing countries.

He said subregional and regional integration should be seen as a real necessity for economic, social, cultural and political development and a basis for long term peace and security. The developing countries had the primary responsibility for promoting South-South cooperation, while the role of the United Nations was supportive and catalytic. He emphasized that many of the activities of the United Nations system were implemented with the technical and financial support of developed countries. Therefore, those countries also played an important role in supporting South-South cooperation.

LIBRAN N. CABACTULAN (Philippines), speaking on behalf of the "Group of 77" developing countries and China, said the international community should commit itself to supporting South-South cooperation, particularly in terms of providing adequate resources. The Group of 77 welcomed the proposal by the Government of Japan to establish a fund within UNDP to support TCDC activities and hoped others would support the initiative. They also hoped the Perez-Guerrero Trust Fund on Economic Development Among Developing Countries (ECDC)/TCDC would be similarly supported by interested donors, to enable it to advance the objectives of the Caracas Programme of Action. The Group of 77 believed the Fund had proven itself to be a meaningful avenue for concrete South-South cooperation projects.

He said achieving wider acceptance of TCDC entailed two simultaneous efforts, namely, effective information and training campaigns and actually carrying out innovative pilot activities and strategic initiatives. Those initiatives should focus on trade and investments, debt, the environment, poverty eradication and macroeconomic coordination and management. The developing countries were convinced of the need to convene a global conference on South-South cooperation, he stated. He added that the conference was a key means towards reinvigorating international support for South-South cooperation, as well as an opportunity to chart courses of action beneficial to the entire international community. The Group of 77 would work with other delegations to advance the initiative by adopting an appropriate resolution on the subject, he stated.

ESPEN RONNEBERG (Marshall Islands) said his country had taken action with neighbouring countries to implement parts of the Barbados Programme of Action. Among other endeavours, he cited attempts to forge a partnership in

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transportation and shipping with Kiribati, Tuvalu and Nauru, as well as with Papua New Guinea. Recently the South Pacific Forum had noted those positive developments, but expressed concern that raising capital for equipment purchases would be a crucial problem. The Asian Development Bank had been called upon to change its operating procedure with regard to funding regional airline cooperation and allow it to finance aircraft purchases.

The costs involved exceeded the capabilities of those countries, he said. However, together they might have great success. "It is therefore difficult to understand why such a win-win scenario does not receive the endorsement of the donor community", he added. That was a practical manifestation of the ideals considered by the Committee. It would be a pity it those countries failed, due to some technicality on project requirements for funding.

MATSUSHIRO HORIGUCHI (Japan) said developing countries were the prime movers behind ECDC/TCDC and the role of the United Nations in that regard was a catalytic and supportive one. It should also, however, take the initiative and develop new conceptual approaches when it was possible and useful to do so. His country attached more importance than ever to supporting South-South cooperation. Japan had provided substantial support for the intergovernmental meeting of experts on South-South cooperation. He welcomed the Chairman's conclusions that South-South cooperation was a viable mode of international economic and technical cooperation and that regional and interregional cooperation constituted essential components of such assistance.

Although South-South cooperation had made some progress, full implementation of that powerful means of promoting development had not yet taken place, he said. One reason for that was an inadequate capacity to implement such assistance on the side of developing countries, and also a lack of cooperation on the part of traditional donors. That was not a satisfactory state of affairs. Japan was considering expanding the Japan-UNDP Human Resource Development Fund as a way to foster new approaches to TCDC, such as triangular cooperation. It would be helpful if an effective facility for promoting South-South cooperation were established within UNDP, such as an open trust fund supported by interested parties.

VINOD KUMAR SHRESTHA (Nepal) said that South-South cooperation was an integral element of international cooperation for development, as well as an essential basis for economic growth. It was not a substitute for but complementary to North-South cooperation. It was, therefore, in the interest

of developed country partners, too, to support South-South cooperation through financial and technical assistance. Nepal was seeking international cooperation in the expansion of primary education and technical training schools.

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He said governments of developing countries should be encouraged to adopt a national TCDC policy, strengthen national focal points and promote triangular technical cooperation arrangements, particularly through participation of the private sector and civil society. Special attention should be given to the specific needs of the least developed countries. Economic cooperation among developing countries could be strengthened by increasing the volume of trade among them. He urged early action on decisions of the Marrakesh Ministerial Meeting of the General Agreement on Tariffs and Trade (GATT) in favour of the least developed countries. His delegation believed the ideas of convening a global conference on South-South cooperation should receive consensus support.

YAO WENLONG (China) said TCDC should be closely linked with ECDC. Economic cooperation should be viewed as an extension of technical cooperation. The ECDC would benefit the development of the developing countries and facilitate their integration into new international economic cooperation. He said developed countries could play an active role in fulfilling the full potential of South-South cooperation. China supported triangular arrangements to finance South-South cooperation activities. He noted that some developed countries already used that modality in their technical assistance projects.

South-South cooperation could not replace South-North cooperation, he stated. The whole international community, including the developed countries, could benefit from South-South cooperation. The Chinese Government had always supported ECDC and TCDC and was prepared to join others in actively searching for ways of cooperation on the basis of mutual benefit. His Government hoped that the developed countries, the relevant organs and organizations within the United Nations system would make further efforts to promote ECDC and TCDC.

THAKUR PHANIT (Thailand) said his country had forged a number of trilateral partnerships, whereby it provided technical assistance to other countries with the funding support of a third party. Such partnerships, in recent years, had become popular modalities for strengthening TCDC activities. He believed that such arrangements were cost-effective and mutually beneficial to the participating parties. He therefore appealed for increased participation by donor countries and international agencies in such cooperation.

He said his Government had this year established an international economic development fund through which it provided soft loans to its immediate neighbours. It was committed to allocating a total budget of $250 million over a five-year period for that purpose. It also had a separate fund for emergency assistance for developing countries experiencing natural and man-made disasters. Thailand's experiences indicated that South-South cooperation need not be confined to the public sector, but could be enhanced with the participation of the private sector and multilateral organizations.

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ISSLAMET POERNOMO (Indonesia) said UNDP should increase its financial allocation to TCDC and help give it greater emphasis. He also said a trust fund should be established by the international community to strengthen TCDC and ECDC. The UNDP Special Unit for TCDC should be strengthened as a separate entity to facilitate the full implementation of the new directions of TCDC, as well as other programmes. To move the TCDC process forward, cooperation in promising areas should be intensified. Those areas included regional economic cooperation and integration, as well as reciprocal arrangements between different groups of developing countries.

Noting that developing countries were primarily responsible for their own development and for expanding TCDC, he said the role of the South Centre in promoting South-South cooperation and self-reliance should be made pivotal. Likewise, at the regional level, he said there was an urgent need for increased exchanges between regional integration secretariats. Supporting mechanisms, such as the UNDP Special Unit and the ECDC division in UNCTAD should also be further strengthened, he stated.

Introduction of Draft Resolution

Mr. CABACTULAN (Philippines), on behalf of the Group of 77 and China, introduced the draft resolution on the challenges and opportunities of global financial integration.

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