ASSEMBLY WOULD WELCOME DECISIONS TO CANCEL BILATERAL DEBT OF CENTRAL AMERICAN COUNTRIES AFFECTED BY HURRICANE MITCH, BY SECOND COMMITTEE TEXT

25 November 1998

Press Release
GA/EF/2854

ASSEMBLY WOULD WELCOME DECISIONS TO CANCEL BILATERAL DEBT OF CENTRAL AMERICAN COUNTRIES AFFECTED BY HURRICANE MITCH, BY SECOND COMMITTEE TEXT

19981125 Texts on Small Island Developing States, Landlocked States in Central Asia, 2002 as Year of Ecotourism, Thirtieth Anniversary of UNFPA Also Approved

The Assembly would welcome the decisions announced by various creditor countries to cancel, partially or totally, the official bilateral debt of the countries of Central America that were most adversely hit by Hurricane Mitch, by one of seven proposals approved by the Second Committee (Economic and Financial) this afternoon.

Further by that draft, on the external debt problem of developing countries, the Assembly would welcome the proposals to discuss at the Paris Club meeting, to be held on 7 December, further debt relief for the concerned countries. It would call upon the international financial institutions to help those countries, including through the early consideration of Nicaragua and Honduras for debt relief under the Heavily Indebted Poor Countries (HIPC) Debt Initiative.

The urgent need to endow the International Monetary Fund (IMF) with adequate resources to provide emergency financing to countries affected by financial crises as a result of the high volatilities of international capital flows would be stressed. While recognizing the benefits of liberalization of international capital flows, the Assembly would note the adverse impact of the volatility of short-term capital flows on exchange rates, interest rates and the debt situation of developing countries. The need for coherence in implementing policies in order to mitigate the adverse impact of such volatility would be stressed.

In addition, the need for attaching higher priority to social aspects of the HIPC Debt Initiative would be recognized, and the need for the IMF and the World Bank to expeditiously address the special needs of poor post-conflict countries, in close cooperation with all relevant parts of the United Nations system, would be stressed.

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By another draft approved, the Assembly would reiterate the urgency of the international community's support of adaptation efforts by small island developing States to cope with the threat of sea-level rise experienced as a consequence of climate change. Those States would be urged to continue preparations for the seventh session of the Commission on Sustainable Development and the special session of the General Assembly in September 1999 for the review and appraisal of the implementation of the Programme of Action for the Sustainable Development of Small Island Developing States.

Under its consideration of the report of the Economic and Social Council, the Committee approved two draft resolutions, under which the Assembly would:

-- Decide that, starting from 1999, proposals for the proclamation of international years should be submitted directly to the Assembly for consideration and action, unless the Assembly decides to bring them to the attention of the Economic and Social Council for evaluation; and

-- Proclaim 2002 as the International Year of Ecotourism.

By another text, the Assembly would invite donor countries and multilateral financial and development institutions to continue to help landlocked States in Central Asia with financial and technical assistance for the improvement of their transit environment. It would also call upon the United Nations system to continue studying possible ways of promoting more cooperative arrangements between landlocked States in Central Asia and their transit developing neighbours, and to encourage a more active supportive role on the part of the donor community.

A draft decision would have the Assembly decide to allocate a plenary meeting during its fifty-fourth session to commemorate the thirtieth anniversary of the United Nations Population Fund (UNFPA).

The Assembly would take note of reports by an oral decision which was proposed by the Committee Chairman.

The Committee will meet again at 3 p.m. on Tuesday, 1 December, to take action on its remaining draft resolutions.

Committee Work Programme

The Second Committee (Economic and Financial) met this afternoon to take action on draft resolutions on, among other topics, trade and development, external debt crisis and development, implementation of the Programme of Action adopted by the 1994 International Conference on Population and Development, and implementation of the outcome of the Barbados Global Conference on the Sustainable Development of Small Island Developing States.

Submitted under the Committee's consideration of the report of the Economic and Social Council, a draft on the proclamation of international years (document A/C.2/53/L.37) is sponsored by the Russian Federation. By the text, the General Assembly would reaffirm the importance of the guidelines for international years and anniversaries, adopted by its resolution 35/424 for the consideration of proposals for the proclamation of international years. It would also decide that, starting from the year 1999, proposals for the proclamation of international years should be submitted directly to the Assembly for consideration and action, unless the Assembly decides to bring them to the attention of the Economic and Social Council for evaluation.

Also submitted under the Committee's consideration of the Council's report, a draft resolution would have the Assembly proclaim 2002 as International Year of Ecotourism (document A/C.2/53/L.38). The text is sponsored by Indonesia, on behalf of the "Group of 77" developing countries and China.

A draft resolution on the transit environment in the landlocked States in Central Asia and their transit developing neighbours (document A/C.2/53/L.34/Rev.1) would have the Assembly request the Secretary-General of the United Nations Conference on Trade and Development (UNCTAD) and the governments concerned, in close cooperation with regional economic commissions, to prepare a report on the implementation of the present resolution, to be submitted to the General Assembly's fifty-fifth session.

Donor countries and multilateral financial and development institutions would be invited, within their mandates, to continue to help the States concerned with financial and technical assistance for the improvement of their transit environment, including construction, transport maintenance, communications, storage and other transit-related facilities.

The Assembly would call upon the United Nations system to continue studying possible ways of promoting more cooperative arrangements between landlocked States in Central Asia and their transit developing neighbours, and to encourage a more active supportive role on the part of the donor community.

The draft is sponsored by Afghanistan, Armenia, Azerbaijan, Belarus, Bulgaria, Georgia, Iran, Kazakhstan, Kyrgyzstan, Mongolia, Republic of

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Moldova, Poland, Romania, Tajikistan, The former Yugoslav Republic of Macedonia, Turkey, Turkmenistan, Ukraine and Uzbekistan.

A draft resolution (document A/C.2/53/L.47) is submitted by a Committee Vice-Chairman, Odyek Agona (Uganda), on enhancing international cooperation towards a durable solution to the external debt problem of developing countries and is based on informal consultations on a previous text on the same topic (document A/C.2/53/L.47).

Under its provisions, the Assembly would note that further progress, including swift implementation of innovative approaches and concrete measures, is essential for contributing to effective, equitable, development-oriented and durable solutions to the external debt and debt-servicing problems of developing countries, particularly the poorest and heavily indebted countries. It would also note -- while recognizing the benefits of liberalization of international capital flows -- the adverse impact of the volatility of short-term capital flows on exchange rates, interest rates and the debt situation of developing countries. It would stress the need for coherence in implementing policies, as well as capital account liberalization to keep pace with the strengthening of the ability of countries to sustain its consequences, in an orderly, gradual and well-sequenced manner in order to mitigate the adverse impact of such volatility.

The Assembly would urge the international community to consider voluntary measures and mechanisms, involving private creditors and taking into account existing frameworks, that would allow debtor countries breathing space through, among other measures, mutually agreed temporary suspension of payments, while maintaining their access to interim financing. In that regard, it would welcome the willingness of the International Monetary Fund (IMF) to consider providing financing to members in arrears on their debt payments to some private creditors.

The urgent need to endow the IMF with adequate resources to provide emergency financing to countries affected by financial crises as a result, among other reasons, of the high volatilities of international capital flows and which continue to pursue a programme of economic stabilization and reform, would be stressed. Also stressed would be the need for the Bretton Woods institutions to fully consider, when providing emergency financing, the special economic situations of indebted developing countries affected by natural disasters.

The Assembly would welcome the decisions announced by various creditor countries to cancel, partially or totally, the official bilateral debt of the countries of Central America that were most adversely hit by hurricane Mitch, as well as the decisions by donor countries to help reduce debt owed to multilateral institutions, while recognizing the need to ensure that adequate resources are still directed towards relief and rehabilitation efforts. The Assembly would welcome the proposals to discuss at the Paris Club meeting to

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be held on 7 December further debt relief for the concerned countries. It would call upon the international financial institutions to help those countries in their reconstruction efforts by, among other measures, lessening the debt-service burden and considering appropriate additional measures, as well as through the early consideration of Nicaragua and Honduras for debt relief under the Heavily Indebted Poor Countries Debt Initiative.

Further stressed would be the need for existing facilities to provide debt-relief measures through various debt conversion programmes, where possible, such as debt-equity swaps, debt-for-nature swaps, debt-for-child development swaps and other debt-for-development swaps, to be widely implemented so that the countries concerned may be assisted in their development efforts. The need to support measures in favour of the most vulnerable segments of the societies of those countries and to develop techniques of debt conversion allied to social development programmes and projects, in conformity with the priorities of the World Summit for Social Development, held at Copenhagen in March 1995, would also be stressed.

The need for attaching higher priority to social aspects of the Heavily Indebted Poor Countries Debt Initiative would be recognized. The Assembly would welcome the progress made in the implementation of the HIPC Debt Initiative and the extension by the Executive Board of the IMF of the original two-year period for countries to begin qualifying for assistance until the end of the year 2000. It would be stressed that the Initiative offers an important opportunity for the heavily indebted poor countries to reach a sustainable external debt position.

Further, by the draft, the Assembly would call for the speedy and determined extension of the Initiative to more countries, and encourage all eligible countries to take policy measures needed to embark on the process as soon as possible so that all can be in process by the year 2000. It would stress the need for the IMF and the World Bank to expeditiously address the special needs of poor post-conflict countries, in close cooperation with all relevant parts of the United Nations system. It would welcome the decision of the Executive Board of the IMF to add a degree of flexibility in its evaluation of track records of policy performance for countries receiving post-conflict assistance.

The urgent need for effective mobilization of additional financial resources for the Debt Initiative from both bilateral and multilateral creditors without affecting the support required for other development activities of developing countries would be stressed. The importance of implementing the Debt Initiative flexibly would be stressed, including shortening the interval between the decision and completion points, taking due account of the policy performance of the countries concerned, in a transparent manner and with the full involvement of the debtor countries.

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The Assembly would recognize the efforts of indebted developing countries in regard to fulfilling their commitments on debt-servicing despite the high social cost incurred, and, in that regard, it would encourage private creditors and, in particular, commercial banks to continue their initiatives and efforts to address the commercial debt problems of middle-income developing countries, in particular those affected by the financial crisis. The urgent need to continue to provide social safety nets to vulnerable groups most adversely affected by the implementation of economic reform programmes in debtor countries, in particular low-income groups, would be stressed.

The international community, including the United Nations system, would be called upon, and the Bretton Woods institutions, as well as the private sector, invited to take appropriate measures and actions for the implementation of the commitments, agreements and decisions of the major United Nations conferences and summits organized since the beginning of the 1990s on development related to the question of the external debt problems of developing countries. The various proposals contained in the Trade and Development Report, 1998, concerning the issue of the external debt of African countries would be noted, and the Secretary-General requested to report pertinent developments relating thereto to the General Assembly at its fifty-fourth session.

A draft decision on commemoration of the thirtieth anniversary of the United Nations Population Fund (document A/C.2/53/L.45), submitted by the Committee Chairman, Bagher Asadi (Iran), would have the Assembly decide to allocate a plenary meeting during its fifty-fourth session to commemorate the thirtieth anniversary of the operation of the United Nations Population Fund, under the sub-item entitled, "Sustainable development and international economic cooperation: implementation of the Programme of Action of the International Conference on Population and Development".

A draft resolution on the implementation of the outcome of the Global Conference on the Sustainable Development of Small Island Developing States (document A/C.2/53/L.46) is submitted by a Committee Vice-Chairman, David Prendergast (Jamaica), on the basis of informal consultations held on a text on the same subject contained in document A/C.2/53/L.15.

Under its provisions, the Assembly would urge small island developing States to continue preparations for the seventh session of the Commission on Sustainable Development and the special session of the General Assembly in September 1999 for the review and appraisal of the implementation of the Programme of Action for the Sustainable Development of Small Island Developing States. It would urge the international community, organizations of the United Nations system and intergovernmental bodies to continue to assist in that regard.

Also by the text, the Assembly would call for the participation of associate members of regional economic commissions in the special session for

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the review and appraisal of the implementation of the Barbados Programme of Action, and in the preparatory process for the session. It would also stress the need for the effective participation of actors of civil society, particularly non-governmental organizations, in the preparation for the special session and the full and effective participation of small island developing States in the special session.

In addition, the Assembly would reiterate the urgency of the international community's support of adaptation efforts by small island developing States to cope with the threat of sea-level rise experienced as a consequence of climate change. It would also request the Secretary-General to submit to the Commission on Sustainable Development at its seventh session and to the General Assembly at its special session for the review and appraisal of the implementation of the Barbados Programme of Action, a report on the Donors Conference.

The Secretary-General would be requested to submit to the Assembly's fifty-fifth session a report on actions taken to implement the present resolution and the recommendations emanating from the special session for the review and appraisal of the implementation of the Barbados Programme of Action.

Action

The Committee first took up the draft resolution on the proclamation of international years (document A/C.2/53/L.37).

Committee Vice-Chairman ODYEK AGONA (Uganda) made oral amendments to the draft, which was then approved without a vote.

The Committee then took up the draft resolution on the proclamation of 2002 as the International Year of Ecotourism (document A/C.2/53/L.38). That text was also approved without a vote.

BAGHER ASADI (Iran), the Committee Chairman, then proposed an oral decision. Under its terms, the Assembly would take note of the following: note by the Secretary-General transmitting the report of the Executive Director of the United Nations Population Fund (UNFPA) on the United Nations Population Award (document A/53/406); and Chapters I to V, VII to X of the report of the Economic and Social Council (document A/53/3). The Committee approved the draft decision without a vote.

The Committee then took up the draft resolution on the transit environment in the landlocked States in Central Asia and their transit developing neighbours (document A/C.2/53/L.34/Rev.1). It was approved without a vote.

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Also approved without a vote was the draft resolution on enhancing international cooperation towards a durable solution to the external debt problem of developing countries (document A/C.2/53/L.47). A previous version of the draft was withdrawn by its sponsors.

The Committee then took up the draft decision on the commemoration of the thirtieth anniversary of the United Nations Population Fund (document A/C.2/53/L.45) and approved it without a vote.

The draft resolution on the implementation of the outcome of the Global Conference on the Sustainable Development of Small Island Developing States (document A/C.2/53/L.46) was also approved without a vote, and a previous version of the text was withdrawn by its sponsors.

Speaking on the draft resolution on the external debt problem of developing countries (document A/C.2/53/L.47), the representative of the Philippines said that in view of the sensitivity and extreme importance of that resolution, there was a need to stay very close to the language approved by the Committee. There were editing mistakes in the document currently before the Committee that should be corrected before the text was brought before the Assembly's plenary session.

The representative of the United States said her delegation associated itself with the comments made by the representative of the Philippines.

The CHAIRMAN said the correct agreed upon text would be submitted to the plenary.

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