PLIGHT OF LANDLOCKED DEVELOPING COUNTRIES IN GLOBALIZATION CONTEXT STRESSED BY SPEAKERS IN ECONOMIC AND FINANCIAL COMMITTEE

15 October 1997

Press Release
GA/EF/2764

PLIGHT OF LANDLOCKED DEVELOPING COUNTRIES IN GLOBALIZATION CONTEXT STRESSED BY SPEAKERS IN ECONOMIC AND FINANCIAL COMMITTEE

19971015 Special Needs of Small Island States and of Those Affected by Economic Sanctions against their Neighbours also Discussed

Remoteness from markets, lack of access to the sea and inadequate transit infrastructure eroded the competitive edge of land-locked developing countries in the world trading system, the representative of Mongolia told the Second Committee (Economic and Financial) this afternoon as it continued its general debate on the world economic situation.

He said the unique circumstances of those countries also caused structural deficiencies and imbalances in socio-economic development. Noting that the "Agenda for Development" had called for specific actions at the national, bilateral, subregional and international levels to address those countries' needs, he said the General Assembly resolution on land-locked developing countries to be adopted by the current session should help to define future measures to tackle the needs and problems of land-locked developing countries.

Nepal's representative stressed that the problems of land-locked developing countries had become graver in the context of globalization and new international trade regimes. Those countries needed the support of transit countries to obtain free and unrestricted access to the sea and to the markets of developed countries.

The representative of Malta said the ever-widening demographic gap and economic disparities between the affluent North and the underdeveloped South in the Mediterranean region were fueling tensions throughout the area. The lack of job opportunities and the deteriorating living conditions were heightening the uneasiness. Noting that environmental degradation knew no borders, he said that the most serious threats to the security of small island States were environmental degradation and economic and social pressures.

Bulgaria's representative said the burden of economic sanctions should be fairly shared among member States and should not be borne by the neighbouring States or economic partners of target countries. Bulgaria had suffered serious economic losses as a result of the strict implementation of United Nations-imposed economic sanctions against its major economic partners,

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including Iraq, Libya and the Federal Republic of Yugoslavia. If measured against the economic potential of Bulgaria, those losses were enormous and commensurate to its foreign debt.

Statements were also made by United Arab Emirates, Nigeria, Kenya, the former Yugoslav Republic of Macedonia, Iran, El Salvador, Democratic People's Republic of Korea and Romania.

The Committee will meet again at 10 a.m. tomorrow, Thursday 16 October, to conclude its general debate and to begin consideration of financing of development and external debt crisis and development.

Committee Work Programme

The Second Committee (Economic and Financial) met this afternoon to conclude its general debate on the world economic situation.

Statements

GHAZI ABDULLAH ASHUR (United Arab Emirates) said the promising performance of the world economy in recent years had not allowed for equitable effects in all the developing countries. Some of those countries had witnessed negative growth while others had suffered recessions and a reduction in gross national product (GNP). The international community must find an appropriate strategy, based on a pattern of cooperation and solidarity in international relations, which would achieve universal stability and economic well-being for all of the countries of the world.

He said the international community must cooperate to achieve sustainable development and promote the necessary achievements within national and international frameworks. His Government was concerned that many economic and structural reforms could not be achieved because of the poverty, illiteracy and unemployment present in many societies. Therefore, it was crucial to promote measures of cooperation between States, including steps to reduce the burden of debt and debt service in developing nations. That could be achieved through building human capacity and technology for peaceful purposes. In addition, the developed countries must honour official development assistance (ODA) commitments by the year 2000.

His Government supported a pluralistic and open trade system, based on international law, justice and transparency and grounded in international conventions and agreements. The results from the liberalization of trade tariffs were disappointing, and the international community should provide for more opportunity for countries of the South to allow them to continue to market and distribute goods for export. Therefore, his Government supported the measures taken by United Nations Conference on Trade and Development (UNCTAD) to facilitate the developing countries access to international markets.

ISAAC E. AYEWAH (Nigeria) said the developed countries and the international financial institutions should pursue and implement policies that would enhance the access of developing countries to markets in the developed world. Globalization of production and liberalization of trade should offer equal opportunities to all countries and enable them to play a more active role in the orientation of the world economy. The implementation of the Uruguay Round agreements remained crucial.

In considering the critical elements of development and the challenges faced by the developing countries, he said, it was necessary to address the external debt burden. The various debt relief measures, including the Heavily

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Indebted Poor Countries Debt Initiative, had not satisfactorily tackled the debt issue of the developing countries. The international community must find a durable solution to the problem. Nigeria supported the holding of an international conference on finance and development before the year 2000.

GANKHUYAG DAMBYN (Mongolia) said lack of access to and from the sea, remoteness from the world markets and inadequate transit infrastructure had eroded the competitive edge of land-locked developing countries in the world trading system. Such a situation further caused structural deficiencies, imbalances and greater difficulties in their socio-economic development. Acknowledging the international community's recognition and support for the special situation of the land-locked developing countries, he said the "Agenda for Development" had called for specific actions at national, bilateral, subregional and international levels to address their needs. The Assembly resolution on land-locked developing countries at this session should define future measures to tackle their needs and problems.

Stressing that economic and technical cooperation among developing countries was a valuable mechanism for promoting growth and accelerated development, he said such cooperation would also strengthen the position of developing countries in international trade and in the world economy. South-South cooperation should focus primarily on the areas of trade, finance, transfer of technology, investment and infrastructure development.

NJUGUNA MAHUGU (Kenya) said sustained economic growth of at least seven per cent was needed to significantly contribute to macroeconomic stability in many developing countries or to make a noticeable impact in arresting and reversing the spread of poverty, which was afflicting a large part of the growing world population. While developing countries had undertaken the necessary economic and structural adjustment programmes to create a conducive environment for foreign investments, the element of foreign direct investment was insufficient to meet their development needs. He urged the international community to increase foreign direct investment, particularly in Africa.

There were clear indications that the end result of the liberalization of world trade might not have been positive in all regions, he said. For example, the opening of the African market to external competition had had negative effects on the continent's industrialization. The phasing out of preferential trade arrangements extended to Africa and other developing countries posed serious threats to their traditional markets. African countries needed support if they were to diversify their economies, and trade remained one of the sure avenues to economic growth and sustainable development. It was vital that access to markets for commodities of developing countries, particularly for textile and agricultural products, be facilitated to increase the share of developing countries in international trade.

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In Kenya's subregion, East African cooperation was undertaking major innovative steps to promote socio-economic integration, he said. The subregion had also expanded the mandate of the Intergovernmental Authority on Development, which focused on issues of development and conflict prevention, management and resolution. He appealed to its development partners to support the implementation of regional initiatives and to complement the efforts of the countries in the region.

SONAM TSHERING SHERPA (Nepal) said the international community should build a new world order that would be acceptable to all by giving equal emphasis to the political and economic development of all countries. There was a need to reverse as a matter of urgency the current marginalization of many developing countries, particularly the least developed ones. The full and effective participation of developing countries was necessary in the resolution of world economic problems.

Explaining that Nepal was both a land-locked and least developed country, he said the special problems of land-locked developing countries had become graver in the context of globalization and new international trade regimes. The lack of direct access to the sea not only entailed additional cost to the products of land-locked developing countries but it also discouraged foreign investment. Land-locked countries needed the understanding and support of transit countries in terms of free and unrestricted access to sea as well as the support of developed countries regarding freer access to their markets towards alleviating those inherent handicaps.

IGOR DZUNDEV (The former Yugoslav Republic of Macedonia) said the World Bank and the International Monetary Fund (IMF) should play a bigger role in international cooperation efforts to promote sustainable development. The activities of the World Trade Organization (WTO) and UNCTAD should also be strengthened. The Second Committee must help ensure that United Nations reform in the field of economic cooperation concluded satisfactorily.

His Government's intensified economic reforms had resulted in an increase in output for the first time in nearly a decade, he said. Also, the cooperative agreement signed between his country and the European Union would go into effect on 1 December. Laws governing employment and unemployment insurance had been adopted, as had laws governing securities exchange and market inspections. Reforms had succeeded in establishing the economic system and institutional framework needed for a market economy. While government macroeconomic policies had rendered positive results, unemployment remained high and foreign investment was unsatisfactory, particularly in the banking field.

External factors, particularly regional aspects, had strong influence on his country, he said. For that reason, his Government strongly advocated integration of the Balkan economies into the European economic structures, firstly through the structure of the European Union.

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MEHDI DANESH-YAZDI (Iran) said, despite tremendous efforts at the international level over the past several decades to define and formulate a comprehensive concept of development, the international community had failed to arrive at a reasonable balance between national responsibility for long-term and sustainable development on the one hand, and the responsibility to facilitate the realization of such an objective on the other. It appeared that the developed world needed to be convinced of the necessity of international cooperation for development. A common understanding on that pivotal concept was imperative, because without it the global economy would not flourish.

The concept of development, including its core elements and constituents, was currently undergoing a process of metamorphosis, he said. The agenda of those in the North had become very parochial and was different from the real needs of the developing societies, which were subject to the shattering pressures of globalization. The two sides of the development divide, North and South, should reach a mutual understanding on that common agenda.

Assessment of the implementation of recent major international conferences provided a good measuring rod of the North's practical commitment to the outcomes of those conferences, he said. The recent special session of the General Assembly to review implementation of Agenda 21 showed that the emphasis on the follow-up measures was to be found more in words than in deeds, particularly concerning the question of financing. And almost two years from the intended review of the implementation of the outcome of the 1994 International Conference on Population and Development, the implementation of the Cairo agreements so far had left much to be desired.

GEORGE SALIBA (Malta) said his Government sought to consolidate its economic development within a framework which ensured the rule of law and respect, and full enjoyment of human rights and fundamental freedoms. While attempting to reduce its national budget deficit, Malta was pursuing a process of "creative evolution" in addressing economic growth and consolidation of social policies. International and regional cooperation should secure economic prosperity in a context of social justice.

Cooperation was also needed in connection with financing development activities which would lead to partnership between the international and local actors, he said. The ever-widening demographic gap and economic disparities between the affluent North and the underdeveloped South in the Mediterranean region were fueling tensions throughout the area, he continued. The lack of job opportunities and the deteriorating living conditions were heightening the uneasiness.

As environmental degradation knew no borders, regional and international cooperation were needed to reach internationally agreed upon goals, he said. The most serious threats to the security of small island States were environmental degradation, as well as economic and social pressures. Malta had been active in the establishment of the Mediterranean Commission for Sustainable Development, the formation of which expressed the shared commitment

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of Mediterranean nations to prevent the environmental degradation of the region. To assist in the effort to protect and safeguard the environments of small island States, Malta called for the implementation of commitments made by the 1994 Barbados Conference. His Government look forward to the planned review of those initiatives in 1999.

PHILIP DIMITROV (Bulgaria) said the burden of economic sanctions should be fairly shared among Member States and should not be borne by the neighbouring States or economic partners of target countries. Bulgaria had suffered serious economic losses as a result of the strict implementation of United Nations-imposed economic sanctions against its major economic partners, such as Iraq, Libya and the Federal Republic of Yugoslavia. If measured against the economic potential of Bulgaria, those losses were enormous and commensurate to its foreign debt.

He called for the implementation of the provisions of General Assembly resolutions urging organizations within the United Nations system, international financial institutions and other bodies to specifically look into the issue of economic assistance to third States affected by the implementation of economic sanctions. With the concerted efforts of the world community, new and innovative practical measures, including direct economic support, as well as alternative forms of non-financial assistance, should be further explored.

GERALDINA BENEKE (El Salvador) said her Government hoped that one major result of the current "reform Assembly" would be the enhanced importance of promoting economic and social cooperation and development, as set forth in the United Nations Charter. Developing countries were aware that the role of international trade and private investment were becoming increasingly important in promoting economic growth and sustainable development. The benefits of globalization were not evident in many developing countries, and private capital flows had not been adequately distributed to all developing countries. Official development assistance (ODA), which was an important supplement and indispensable to certain countries, had also declined constantly in recent years. Any international assistance project for development should be carried out closely with recipient countries. She appealed to developed countries to do what they could to meet the proposed ODA targets.

In El Salvador the model of a social market economy, designed in 1989, had achieved macroeconomic stability and was promoting competitiveness, she said. The country had also experienced sustained economic development with 6.5 per cent annual growth during the period of 1992-1995. In addition, inflation had been reduced to the single digits. Despite those efforts and achievements, El Salvador still required international assistance and cooperation. Measures to liberalize and open international markets were designed to achieve free and equitable trade, but many countries were still far from achieving that ideal, particularly in the agricultural and textile areas.

RI KWANG NAM (Democratic People's Republic of Korea) said the international community should establish equitable economic relations based on

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genuine partnership in order to eliminate poverty and inequality, achieve sustainable development and guarantee the prosperity and well-being of mankind in the twenty-first century. It should implement political commitments and action plans formulated at recent international conferences. As long as inequitable economic relations remained, no country could hope for sincere cooperation on sustainable development in the world and the challenges facing the world could not be fundamentally addressed.

To that end, efforts should be made to democratize the decision-making process in terms of issues related to the international economy, finance and trade by ensuring equal participation of the developing countries, he said. Preferential terms for developing countries should continue to be applied in international trade to complement their comparative vulnerability and limitations. Further constructive initiatives should be taken to solve the external debt problem of the developing countries. The right to development and to choose a social and economic system should be respected in international economic and trade relations. Economic blockades and sanctions against certain countries should not be tolerated.

ION GORITA (Romania) said a permanent exchange of information between the Committee and international institutions dealing with specific aspects of the economic process would contribute to the Committee's consideration of globalization. Touching on other factors which might aid the Committee's review, he said placing the issue of regional integration on the Committee's agenda would open the way to a broad exchange of information about a dynamic process in the world economy. The input of management of important companies involved in globalization would also assist the Committee. He welcomed the idea of reviewing small and medium enterprises as a special item. The relationship between development and democracy might well become a future theme in the Committee's debate.

The Department of Economic and Social Affairs had become the central element for coordination of economic and social activities, he said. The creation of the Department offered a great opportunity for coordinating United Nations activities for development. Future activities of the Department might include promoting debate, dialogue and information exchange at the United Nations and with international institutions, as well as with the private sector. The Department could work to disseminate information about the results of United Nations deliberations in the economic, social and related fields. Follow-up to United Nations conferences could be strengthened and information exchange between United Nations programmes and funds could be improved.

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