ECONOMIC AND FINANCIAL COMMITTEE HEARS CALL FOR INNOVATIVE POLICIES TO OVERCOME VULNERABILITIES POSED BY GLOBALIZATION

19 October 1998

Press Release
GA/EF/2828

ECONOMIC AND FINANCIAL COMMITTEE HEARS CALL FOR INNOVATIVE POLICIES TO OVERCOME VULNERABILITIES POSED BY GLOBALIZATION

19981019 Speakers Stress Need to Implement Sustainable Development Commitments and Policies Elaborated in 1990s

Development policies which pursued mainly economic growth based on a set of liberalized measures were insufficient to manage the risks of globalization, the representative of the Republic of Korea told the Second Committee (Economic and Financial) this morning as it considered issues related to sustainable development and international economic cooperation.

She called for innovative policies to be devised with a greater emphasis on overcoming vulnerabilities posed by globalization. In developing such new and innovative policies, the revitalized role of governments as facilitators, rather than as regulators, should be taken into account.

Speaking on behalf of the European Union and associated States, the representative of Austria said a policy of regional and international integration must be paralleled by domestic institutional reforms. It was the responsibility of governments to establish and implement growth-oriented national economic policy frameworks. Countries in transition should be responsible for establishing effective policies, strengthening their institutional framework, and allowing the competitive process to work its full potential.

Speakers also stressed the need to implement commitments and policies developed in the 1990s, including the Declaration on International Economic Cooperation and the International Development Strategy for the Fourth United Nations Development Decade. The representative of Panama, on behalf of the Rio Group, said in the 1990s sustainable development had become a watchword and had helped in efforts to establish a real agenda for development. The world must not let the decade go by without implementing those goals, she stressed.

Statements were also made by the representatives of Indonesia (on behalf of the "Group of 77" developing countries), China, Ghana, El Salvador and

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Pakistan. A representative of the United Nations Educational, Scientific and Cultural Organization (UNESCO) also spoke.

The Committee will meet again at 10 a.m. tomorrow, 20 October, to resume its discussion of sustainable development and international cooperation. Under that general heading the Committee will be considering the following sub-items: integration of the economies in transition into the world economy; renewal of the dialogue on strengthening international economic cooperation for development through partnership; and cultural development.

Committee Work Programme

The Second Committee (Economic and Financial) met this morning to consider, under the general heading of sustainable development and international economic cooperation, the utilization of the development dividend and a report by the United Nations Educational, Scientific and Cultural Organization (UNESCO) on communication for development programmes in the United Nations system. The Committee also took up under that heading the question of implementation of and follow-up to major consensus agreements on development.

A report by the Director-General of UNESCO concerns the communication for development programmes in the United Nations system (document A/53/296).

The report addresses the implementation of General Assembly resolution 51/172, including 10 recommendations of the Sixth Inter-Agency Round Table on Communication for Development.

Concerning recommendation 1, the United Nations System-wide Special Initiative on Africa, UNESCO has prepared a document indicating the conceptual framework and strategy for action, objectives, expected results, budgetary requirements and coordination mechanism. The UNESCO has also selected five pilot countries -- Burundi, Congo, Ethiopia, Liberia and Mali -- to undertake national studies on communication and peace-building. Some of those studies have begun, and their findings would be discussed in 1998 with a view to drawing up national plans of action and project proposals for each of the five countries.

In the spirit of recommendation 5, several projects in developing countries have made use of informatics and related technologies for networking of journalist schools, networks of women media practitioners, news and information dissemination through the Internet, and cataloguing and documentation of news photo agencies, among others.

In anticipation of recommendation 9, UNESCO, together with several other specialized agencies, has contributed to the preparation of an analytical, evaluative and comparative study of project cases using communications to attain development objectives.

The report also summarizes the relevant work of the Food and Agriculture Organization (FAO) and details its priorities concerning the identification and appraisal of communication needs to support agricultural and rural development, and the application of appropriate communication policies, strategies, media and messages. The decisive role that communication plays as sustainable development is promoted and advocated is described, with special attention to how communication can establish a dialogue with rural people, mobilize their participation in development activities, and convey the

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information and skills they need to put agricultural knowledge and technology to best use.

A major contribution is in the effective use of communication strategies and media in Africa, where 65 per cent of FAO Communication for Development activities were carried out during 1996-1997, the report says. Emphasis is placed on the use of rural radio, one of the most widespread communication tools in Africa, that is especially effective for teaching remote rural audiences. Other media and communication processes ranging from traditional media to video to modern communications are also used.

According to the report, in Mali the FAO helped to establish a multimedia production service centre that plays a key role in supporting national capacity to implement communication for development programmes and projects. In the subregion, the centre is becoming a cost-effective and financially sustainable provider of multimedia services in support of communication for development in various countries.

The report also discusses the role of the United Nations Children's Fund (UNICEF), saying sustainability, management and financing are essential components of the agency's project planning, as suggested in recommendation 2 of the Sixth Inter-Agency Round Table.

In order to continue capacity-building efforts in support of recommendation 5 of the Sixth Inter-Agency Round Table, the report said UNICEF was developing an internal knowledge network for sharing programme information, statistics on the results of evaluations and other data. The Children's Fund has also made significant investment in training packages in communication for use in developing countries in accordance with recommendation 7. Efforts suggested in recommendation 9, such as collaboration and information-sharing, are central to UNICEF's ongoing communication activities. Currently UNICEF is collaborating with other United Nations' agencies, donors, foundations, non-governmental organizations and academic institutions.

The report also details the work of the United Nations Population Fund (UNFPA), saying one of the most important features of the International Conference on Population and Development Programme of Action is its underlying theme of an interdisciplinary and coordinated approach to dealing with population issues. Information, education and communication and advocacy are the two major types of UNFPA-supported communication operations at the country level.

Effective communication in reproductive health/family planning programmes is a two-way process, the report says, that depends in large part upon the service providers' understanding of users' perspectives, their empathy for the clients and their ability to meet those perceived needs. Moreover, a recent UNFPA thematic evaluation on adolescent reproductive health

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has provided impetus to strengthen government action to address adolescent reproductive health needs.

According to the report, youth and adolescents are among the groups most vulnerable to HIV infection, and are thus a target for UNFPA assistance. In the area of communication for behaviour change to prevent HIV/AIDS, the UNFPA, among other things, collaborates with other agencies in in-school and out-of- school education activities, and in the training of reproductive health information and service providers.

The Committee also had before it a report of the Secretary-General on the utilization of the development dividend (document A/53/374), which contains proposals for use of the development dividend following the establishment of the Development Account. The proposals have been drawn up within a $13.065 million appropriation to maximize its impact, and draw upon and contribute to the relevant priorities and subprogrammes established in the medium-term plan for the period 1998-2001. However, the proposed projects will complement and not substitute existing activities.

The report states that, in a world where globalization, liberalization and interdependence have become key features of the world economy, the most important challenge for developing countries is the realization of development, which, inter alia, calls for economic growth and favourable external conditions. That is the larger setting for the proposals contained in the report. The report relates that information flows and, consequently, information and technology have been and are a major engine of globalization; however, many developing countries are still at the margin of the global economy, and will be unable to participate in it positively without a significant enhancement of their ability to connect to major international and information networks.

In his reform proposal, the Secretary-General announced his intention of increasing the use of information technology and strengthening South-South cooperation. He stated that focusing on the utilization of the development dividend on information technology and networking for development should be an important contributor to this goal.

The report outlines several proposed uses for the development dividend. These include the promotion of electronic commerce through development and maintenance of informational exchange and policy analysis frameworks, particularly for government officials in developing countries and countries in transition. The implementation of this project is expected to result in the elimination of some of the obstacles to participating in electronic commerce and increased access to physical network, resource and technology, and enhanced awareness of decision-makers and negotiators from developing countries and countries in transition about the nature of issues related to electronic commerce.

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Another proposal concerns capacity-building in economic and social policy analysis in Africa through the networking of expertise, the report stated. Proposed activities would include the undertaking of studies of common national policy issues, such as trade and exchange regimes, structural adjustment policies and private sector promotion policies; undertaking analysis of subregional problems, such as economic integration, transportation and standardization issues, and water and natural resources management, conducting studies on Africa-wide issues and issues facing Africa, versus the rest of the world, such as global environmental topics, international trade, monetary arrangements and external debt negotiations.

The implementation of this project will result, the report states, in the strengthening of a network of development expertise on Africa with and among research centres and individual experts, and enhanced analytical and applied skills at the national policy-making level in support of economic and social policy-making.

A further proposal involves the extension of access of developing countries and countries with economies in transition to the Mercure satellite telecommunication system for interconnectivity in environmental information and data. This project will provide: Mercure earth stations, and associated equipment; small-scale local area network systems; training for Earth station managers and assisted computer network officers; technical assistance during the duration of the project on the use of the Mercure system to access environment information and data to facilitate environmental information and data to facilitate environment planning and management; and support to the global Mercure satellite transponder system.

Upon its implementation, the report states, this project is expected to result in improved exchange facilities and access of governments of developing countries and countries with economies in transition to information and data relating to environment and sustainable development.

The report states that a further proposal involves capacity-building and networking for the implementation of the United Nations Centre for Human Settlements (Habitat) agenda in least developed countries. This project will provide among other things: development and testing of training aids and methodological tools for the collection, analysis and application of urban indicators, best practices and good policies for the monitoring and implementation of national and local plans of action. It is expected to result in providing major groups in recipient development countries acquiring the core skills, and knowledge relating to the analysis exchange and application of data and information on urban indicators.

Other proposals concern promotion of: an on-line development centre; a research network for global policy analysis; activities for the implementation of Agenda 21, the Copenhagen Declaration and the Programme of Action of the World Summit for Social Development, and the Beijing Declaration and Platform

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For Action; and a computer and telecommunications system for international and national drug control. Annexed to the report is a list of resource requirements, by project. The total resources required, for all the projects, are expected to amount to some $12.3 million.

The Committee also had before it the report of the Secretary-General on implementation of the International Development Strategy for the Fourth United Nations Development Decade (document A/53/301). That report addresses developments since 1996, globalization and growth, the impact of globalization on the least developed countries and the next millennium, among other issues.

According to the report, the Asian financial crisis completely altered the immediate and possibly longer-term prospects for developing countries. While the developing economies maintained their growth momentum in 1996 and 1997, growth in 1998 was expected to be under 4 per cent. The slow-down was most pronounced in East and Southeast Asia. Moreover, the contraction in economic activity was associated with a severe compression of imports, primarily capital goods and intermediate inputs. The sharp rise in unemployment in a number of Asian countries was expected to worsen as a result of lay-offs due to corporate and financial retrenchment.

The report states that while the term "globalization" refers to a complicated phenomenon, most generally it connotes the growing interdependence of economies through the increasing volume and variety of cross-border transactions, including goods, services, capital, technology and some labour. Globalization may also refer to transnational corporations fanning out worldwide. While several aspects of globalization promote efficiency, and thus contribute to the most effective use of global resources and the maximization of world output, the advantages of globalization for an individual economy play themselves out via the benefits of greater openness to a country's welfare.

In an increasingly globalized and liberalized world economy, the marginalization of least developed countries might accelerate, the report says. The exports, imports, investment and gross domestic product (GDP) of those countries remain insignificant compared with those of other developing countries. The main markets for least developed countries are the Organisation for Economic Cooperation and Development (OECD) countries and -- within the OECD -- the European Union. Although least developed countries enjoy duty-free or Most Favoured Nation treatment in many OECD countries, especially for many tropical products, their industrial products -- such as textiles, clothing, footwear and leather goods -- are still excluded from the Generalized System of Trade Preferences (GSTP) benefits and hence are subject to tariffs of up to 30 per cent in some OECD markets.

The report states that, as the world economy heads towards the twenty- first century, it faces the challenges of growth and sustainability. United Nations global conferences have been devoted to various aspects of the

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development process and have changed the perception of what constitutes a viable development strategy. On the international front, thinking about development is increasingly focusing on such issues as poverty eradication, and development plans are once again incorporating numerical targets.

Statements

NINA SIBAL, of the UNESCO, said that, from its creation, UNESCO had been mandated to act as the special guardian of the free flow of ideas by work and by image. That principle of the free flow of information serves as the foundation of democratic societies everywhere. That had nowhere been better at work than in Eastern and Central Europe in the last nine years. It had been at the moment that the Berlin Wall was crumbling in 1989 that UNESCO adopted a new communication strategy.

That strategy, she said, was intended to encourage the free flow of information to promote the wider and better balanced dissemination of information, without any obstacle to freedom of expression. It was also intended to strengthen communication capacities in the developing countries in order to increase their participation in the communication process. The free flow of information, together with the right to freedom of expression, formed the social and political basis of human development.

MOCHAMAD HIDAYAT (Indonesia), speaking on behalf of the "Group of 77" developing countries and China, said that, with the onset of the world financial crisis, prospects for prosperity in developing countries had been reduced. Traditional multilateral cooperation for development had been minimal since the crisis. The opening up of economies had exposed numerous developing countries to destabilized markets. It was crucial that the international community implemented the goals of the International Development Strategy for the Fourth United Nations Development Decade. As the next millennium approached, it was even more crucial to put developing countries back on the track of development.

HANS-MICHAEL PLUT (Austria), speaking on behalf of the European Union and Bulgaria, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia, Slovenia and Cyprus, said that the European Union-African, Caribbean and Pacific (ACP) countries partnership aimed at the smooth and gradual integration of the developing countries into the world economy and the eradication of poverty. All partners recognized that all the means available under the revised Lomé Convention should be used to remedy the deterioration in the ACP States' commercial performance, resulting in particular from their lack of competitiveness, the erosion of their preferences and their insufficiently diversified economies.

He said that a policy of regional and international integration must be paralleled by domestic institutional reforms. It was the responsibility of governments to establish and implement growth-oriented national economic

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policy frameworks. The European Union believed that transition countries should be responsible for establishing effective policies, strengthening their institutional framework and allowing the competitive process to work its full potential.

BAI YONGJIE (China) said some developing countries had attained relatively speedy development; however, on the whole, the North-South gap continued to widen and people living in poverty continued to increase. The marginalization of many developing countries demonstrated that the mass flow of capital, trade and services brought about by globalization had not led to balanced benefits for those countries. As the new century approached, the international community should take action to realize the development strategies of the 1990s to avoid another lost decade for some developing countries.

He said that developing countries needed to: work energetically, continue to reform and adjust, incorporate helpful policy recommendations, formulate economic and social development policies that conform with their national situation, and create conditions for realizing growth and prosperity. For the developed countries, it was important that they undertake the principal responsibility for creating a favourable external environment and carry out their commitments. They should also provide to developing countries urgently needed assistance in the areas of finance, trade and debt relief, and assist them in overcoming obstacles on the road to development.

KWABENA OSEI-DANQUAH (Ghana) said his country regretted that, as the next millennium approached, the goals and objectives of the International Development Strategy for the 1990s remained a distant hope because of the failure of the will to follow through with the agreed commitments.

It was his country's hope, he said, that the other side of the development equation -- the role of external development partners and external inputs on moving developing world economies to take off -- would not take as long to be accepted as a major factor in any viable development strategy from developing countries. He called for innovative ways to be utilized by developed countries to channel investment funds and credits towards developing countries.

JUDITH CARDOZE (Panama), speaking on behalf of the Rio Group, said that wiping out poverty and hunger, achieving a lasting solution to indebtedness and protecting the environment, among other things, continued to be crucial concerns. The 1990s had been a decade for looking at actions to address such concerns. Sustainable development became a watchword in the decade. It also helped to establish a real agenda for development. Concerted action by the international community was needed to fulfil the goals of the development strategies of the 1990s.

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She said the world must not let the decade go by without implementing the goals of the summits and conferences. However, the United Nations could not expect real progress if it did not put its own house in order. That was why reform measures were so important. To ensure stability and growth in her region, governments there were living up to the commitments of summits and conferences during the decade. However, those efforts would not be useful if they were not undertaken along with real international economic cooperation.

ANA GERALDINA BENEKE (El Salvador) said the growing globalization of markets and the financial crisis were having an adverse impact on development trends. The goals and objectives of the International Development Strategy for the 1990s should be carried out. Building firm and stable economies should continue to be a priority for the international community. Transborder flows had increased capital in developing countries. However, foreign direct investment flows had favoured the 10 major developing countries while others remained on the sidelines. That was true despite those countries' efforts to reform their economies. It was important to maintain cooperation in international financing and development. In that regard, it was discouraging to see the downturn in official development aid (ODA). That continued to be a factor that was hurting the ability of developing countries to implement sustainable development strategies.

OH YOUNG-JU (Republic of Korea) said that development policies, which had mainly pursued economic growth based on a set of liberalized measures, seemed to be insufficient to manage the risks of globalization and to realize various objectives of development. Innovative policies should be devised with greater emphasis on overcoming vulnerabilities posed by globalization. In developing such new and innovative policies, the revitalized role of governments as facilitators, rather than regulators, should be properly taken into account.

She added that the world community should look into optimal ways to successfully manage globalization at the international level. A stable international economic environment was indispensable to secure sustainability and continued growth of developing countries. However, the current financial crisis had put into question the usefulness of the existing economic and financial architecture. The current crisis, instead of being only financial, could be considered as a macroeconomic management crisis of the world economy. It therefore required a whole new way of assessing the existing international policies and institutions. She called for concrete and concerted actions to be taken to shape a viable international economic architecture.

AHMAD KAMAL (Pakistan) said that the Secretary-General's idea of providing funds for development was now starting to materialize. The first tranche of $13.065 million had been made available. Proposals had been submitted for utilization of those funds. "We support the `concept of networking for development' around which the projects for the biennium 1998-1999 have been prepared."

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Information technology was a major engine of globalization, he said. However, many developing countries, especially least developed countries in Africa, would not be able to participate in it without the ability to access international networks. Certain projects had the ingredients of generating a multiplier effect in participating countries, and he supported enabling those countries to participate in electronic commerce and training.

He stressed the need for capacity-building of the developing countries in order to enable them to benefit from such networks. Referring to projects proposed in the report of the Secretary-General, he said that the proposal regarding an on-line development centre would not make a great contribution towards capacity-building. The proposal on developing a drug control strategy information system lacked the appropriate personnel training and human resources development. Projects undertaken with development dividend funds should focus on those which trigger the multiplier effect, support South-South cooperation and extend benefits to least developed countries, especially those in Africa.

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