SECRETARY-GENERAL TELLS ECONOMIC AND SOCIAL COUNCIL ERADICATION OF POVERTY IS AMBITIOUS BUT ACHIEVABLE GOAL
Press Release
ECOSOC/5827
SECRETARY-GENERAL TELLS ECONOMIC AND SOCIAL COUNCIL ERADICATION OF POVERTY IS AMBITIOUS BUT ACHIEVABLE GOAL
19990706 Opening Council Session, Kofi Annan Calls for Balanced World Growth, Increases in Aid, Debt Relief; High-Level Debate on World Economy Begins(Reissued as received.)
GENEVA, 5 July (UN Information Service) -- United Nations Secretary-General Kofi Annan opened the annual session of the Economic and Social Council this morning by urging an unprecedented effort by countries and the international community to eradicate poverty, saying it was unacceptable that half the world's 6 billion people tried "to eke out a living on $3 a day or less".
He termed the goal "ambitious, but not utopian", noting estimates that an additional investment of $40 billion annually would achieve universal access to basic social services -- education, nutrition, reproductive health, family planning, safe water and sanitation. "That is less than what Europeans spend on cigarettes", he told the meeting.
Mr. Annan said industrial nations should promote "higher and more balanced rates of world economic growth" and higher levels of employment around the globe, and should increase their official development assistance to poorer countries; that access to trade and decision-making by the poor should be expanded; that enlightened leadership and "enabling environments" for economic growth must be established in developing countries; and that the debt burdens of impoverished nations, which in some cases consumed more than half their annual budgets, should be eased.
The theme of this year's four-week ECOSOC session is eradication of poverty. Council President Francesco Paolo Fulci (Italy), introducing the topic, said elimination of hunger, want and destitution was first and foremost a moral obligation, but also a question of enlightened self-interest. There was a need to act swiftly and jointly, he cautioned, or the sheer size of the problem would overwhelm everyone.
Another keynote speaker, Juan Somavia, Director-General of the International Labour Office, said, among other things, that there should be a human face to the global economy and that its current benefits were blocked and had not reached enough people.
A policy dialogue and discussion on important developments in the world economy followed, featuring Michel Camdessus, Managing Director of the International Monetary Fund (IMF); James Wolfensohn, President of the World Bank; Rubens Ricupero, Secretary-General of the United Nations Conference on Trade and Development (UNCTAD); and David Hartridge, Director-in-Charge of the World Trade Organization (WTO).
The IMF's Mr. Camdessus said, among other things, that a crucial component of economic growth was peace and that sales of military equipment to sensitive regions should be restrained and the globe's poorer countries should -- as recommended -- limit military expenditures to 1.5 per cent of their gross domestic products (GDP).
Mr. Wolfensohn of the World Bank told the meeting, among other things, that providing equal rights to women was vital for eradicating poverty and that stable economic growth could not be achieved without the enfranchisement and provision of economic opportunities to half the world's population.
Among the remarks of Mr. Ricupero of UNCTAD were that the century was ending with a failure to resolve two major threats to the future: mass unemployment and growing inequality. Disparities in the distribution of wealth and income were on the rise, both between and within nations, he said, and guaranteed employment had become a thing of the past. Such problems had to be addressed.
The WTO's Mr. Hartridge said trade liberalization had fostered economic growth that had brought enormous benefits to the people of the world, especially the poor, and that to suggest that poor people and poor countries would be better off if there were less trade and less foreign investment, which seemed to be the implementation of some of the recent polemics, was nonsense.
Members of the panel answered questions from the floor on, among other things, widening income disparities; rising unemployment; improved coordination between the WTO and the Bretton Woods institutions (the IMF and World Bank); balancing the benefits of "free markets" with the need for rules and oversight; and liberalization of trade in agriculture.
The policy dialogue was the first of four days of activities under ECOSOC's annual high-level segment, devoted this year to the topic of "the role of employment and work in poverty eradication: the empowerment and advancement of women".
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Participants in the meeting also viewed a brief video on world poverty. The film, produced by the Department of Public Information, noted, among other things, that although the global food supply was at an all-time high, 60 children died of hunger every minute.
Posing questions during the dialogue were representatives of Guyana (on behalf of the "Group of 77" developing countries and China); Finland (on behalf of the European Union); Pakistan; the United Nations Development Programme (UNDP); and El Salvador.
The Economic and Social Council will reconvene this afternoon at 3 p.m. to continue its dialogue on developments in the world economy.
Statements
KOFI ANNAN, United Nations Secretary-General, said the global economic recession that had caused such concern last year had begun to ease, and Asia and Latin America were showing encouraging signs of recovery. But it was no time for complacency -- the risks of a further slowdown were still significant and, more important, the world faced a continuing crisis of development.
Although developing countries had covered as much distance in human development over the past 30 years as the industrial world had managed over more than a century, with major reductions in malnutrition and infant mortality, among other things, there was an inescapable blot on this record of achievement, Mr. Annan said: the extent of global poverty in rich and poor countries alike. Half the world's population of 6 billion was mired in poverty, trying to eke out a living on $3 per day or less.
The goal of eradicating poverty was the primary focus of the Economic and Social Council, the Secretary-General said; it was an ambitious goal, but not utopian. It had been estimated that the total additional investment required to achieve universal access to basic social services -- education, health, nutrition, reproductive health, family planning, safe water and sanitation -- was roughly $40 billion per year. That was less than what Europeans spent on cigarettes, and one-tenth of the world trade in illegal drugs.
Some priorities needed to be set, Mr. Annan said. The industrial nations needed to enact policies that would promote higher and more balanced rates of world economic growth and would increase global employment. The global community -- through aid, trade, and through decision making at the United Nations and elsewhere -- must give highest priority to meeting the basic needs of the poor. The decline in official development assistance, now at its lowest level in half a century, must be reversed, and developing countries must be granted relief from debt that was stifling their development and, in some cases, took up more than half their annual budgets. And the
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governments of developing countries must shoulder the primary burden of eradicating poverty, must provide enlightened leadership and must take the steps necessary to establish enabling environments for economic growth, among other things by providing their citizens with freedoms that would release their creative and entrepreneurial energies.
Investments in women -- especially the education of women and girls -- were a key to sustainable development and brought great dividends to families, communities and entire societies, Mr. Annan added.
The extent and severity of global poverty was not just a global financial and economic crisis. It was a global, moral and ethical crisis that called for more than declarations of intent and protracted negotiations. It called for confronting the true deficit: not trade deficits or budget deficits but rather the deficit in political will that was the biggest obstacle, the Secretary-General concluded.
FRANCESCO PAOLO FULCI (Italy), President of the Economic and Social Council, said that poverty was a fact of life, and the plight of 1.5 billion persons living in abject poverty could no longer be ignored. Never before in history had there been such a tremendous level of awareness of the need to fight poverty. Nor had there been a similar commitment and capacity to fight it. Poverty was not the destiny of humankind. Elimination of hunger, want and destitution was first and foremost a moral obligation. But it was also a question of enlightened self-interest. There was a need to act swiftly and jointly or the sheer size of the problem would overwhelm all.
Mr. Fulci said charity was not the solution. The poor needed to be empowered. The only long-term cure was sustainable development. ECOSOC needed to return to its role as the central organ of the United Nations for international economic and social issues. Poverty eradication should be its overarching goal. Doable actions were the priority, and governments, international organizations, civil society and the private sector should be engaged fully. The eradication of poverty was the leitmotif of the entire session, encompassing the specific themes and issues into a grand design that drew from the conclusions and results of the nine United Nations global conferences of the 1990s.
Mr. Fulci said his ambition as President was to achieve results. He was sure that thanks to the good will and constructive attitude of all, the session would be equal to expectations.
JUAN SOMAVIA, Director-General of the International Labour Office, said there was a need to ensure that markets worked and provided for all. There should be a human face to the global economy. Open economies were more efficient than closed ones as over-regulation stifled creativity. The benefits of the global economy seemed to be blocked, and had not reached
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enough people. The principal responsibility was to concentrate on the manner in which markets and society interacted, and to demonstrate that markets could work for all.
There was a need for an integrated analysis of policy proposals within the multilateral system, Mr. Somavia said. Policies had been organized by sector, and yet society was an integrated whole, as was the global process. There was a need to find ways in which the multilateral system provided an integrated policy system. The multilateral system had to be the step required by the global economy to enhance this.
Mr. Somavia said the notion of productivity needed to be expanded beyond economics. It was too restrictive as a measure of social progress. Housework had not been acknowledged statistically by economists, for example, nor had free use of the environment. A wider framework for the notion of productivity should be developed. Social productivity should also be further analysed. It was difficult to evaluate processes, such as the sense of security produced by social productivity. The necessary link between unemployment and social disruption had not yet been made.
He proposed a multilateral task force that should focus, for example, on the eradication of the worst forms of child labour. But this was not just an issue for the multilateral system, it was a global issue, and all should be involved in its eradication.
MICHEL CAMDESSUS, Managing Director of the International Monetary Fund, said the global economic crisis of the past few years had receded, but further crises could occur if several lessons learned were not taken to heart and practised. A number of countries in Latin America and Asia had contributed greatly to recent global economic recovery by adopting right away the reforms called for -- among them Thailand, Indonesia, Philippines and Brazil.
Among other things, sound fiscal polices must be tailored carefully to the specific situations of countries and must be properly centred on human development priorities, Mr. Camdessus said; the health of the corporate and financial sector must be kept under much stronger surveillance; exchange rate regimes and the conduct of exchange rate policy should be adapted to economic fundamentals; transparency and good governance must be seen as essential components of the sustainability of economic policies; countries must act before crises struck to set up social safety nets adapted to the needs of vulnerable groups; and participatory decision-making systems must be set up, as they were crucial for guaranteeing popular support for in-depth economic reforms.
In fighting poverty, Mr. Camdessus said, the primary responsibility still lay with Governments, and the key to economic development was high quality growth and high quality investment. To achieve such growth and
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attract such investment, the world's poorer countries needed to learn from the lessons of the recent crisis and needed to make wise human investments in education, health and infrastructure so that stable macroeconomic foundations were established. A number of African countries had done so during the 1990s and had reversed a decade and a half of declining per capita growth. Internationally, industrialized countries must optimize their growth so that the benefits were spread to poorer nations, and they should expand direct development assistance and debt relief to poor countries.
A final concern was peace, Mr. Camdessus said; too often conflicts destroyed hard-earned development progress, as in Africa. Sales of military equipment to sensitive regions should be restrained; export credits for military purposes should be ended; poor countries should -- as recommended -- limit military expenditures to 1.5 per cent of their gross domestic products (GDP); and nations should cooperate to interdict the smuggling of raw materials and natural resources used to finance armed insurgency in many African countries.
JAMES WOLFENSOHN, President of the World Bank, said that the impact of poverty on women had already been fully recognized. Poverty had grown considerably since 1974. Hope had been for the achievement of halving poverty by 2015, but this seemed sadly elusive.
Employment and work were good means to combat poverty, Mr. Wolfensohn said. The question was how to achieve these, especially for women. There was a need for growth, and for good macroeconomic policies. Those most affected by economic crises were the poor, and women. Women were over 50 per cent of the effective work force, and yet it was difficult to find employment programmes that were more than half equal. The issue of implementation of the equal rights of women was vital. In times of economic stress, women suffered more. The key to growth was the key to enfranchisement and opportunities of women. The move from statement to application was the challenge for all. Engagement of women and poor in policy-making was important.
Mr. Wolfensohn said policy was too often set without the consent of those concerned. Multilateral institutions needed a more all-embracing set of priorities. A true partnership between governments, multilaterals, civil society and the public sector was required. Employment needed proper and appropriate governance that would protect the rights of the poor and of women. Appropriate governance was an essential starting point and indeed a prerequisite for the eradication of poverty. Implementation of policies required proper governance. Policy issues needed to be addressed by those in government. Application of these policies was difficult -- economic growth could not be guaranteed to provide work opportunities for the poor. Engaging communities in terms of addressing their own futures was a means for this. A new form of development under this form was appearing, and was the key to the future for these people. There were many new challenges to take.
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The future, in terms of policies, was not just the statements made. The challenges were to find new, all-inclusive ways to implement policies and to engage the poor in many ways, including policy decision making, Mr. Wolfensohn said. The real challenge was implementation of these policies, so that a partnership could be made with not just the multilaterals, but with those concerned, including women.
RUBENS RICUPERO, Secretary-General of the United Nations Conference on Trade and Development (UNCTAD), said that there were better ways of ending a century than with a war superimposed on a major economic crisis amidst recurring bouts of food panic. Wars, crises, food panics, all shared a common effect: fear, anxiety, insecurity. They did this not only by inflicting actual pain but also by threatening to take away the possibility of having a future. The century was ending with failure to solve two major threats to a future with security: mass unemployment and growing inequality. Disparities in the distribution of wealth and income were on the rise, both between and within nations. Guaranteed employment had become a thing of the past.
In the poor parts of the world, the turbulent events of the past two years had challenged the very core of belief in the possibility of sustainable and sustained development, Mr. Ricupero said. There was a crisis of development which raised serious questions as to whether it would be possible in the future to recover the levels of dynamic economic performance which had been until recently the only convincing demonstration of the possibility of development over several decades.
Mr. Ricupero said developing nations had striven hard to integrate more closely into the world economy. They had all too often been confronted with deep-seated imbalances in economic power and systemic biases in the international trading and financial systems. Projections of the gains had proved overly optimistic. Faced with this situation, the time had come to rethink policies and responsibilities. Developing countries needed to protect their policy autonomy if pragmatism was to prevail over ideology. Efforts should now turn to the trading system. With this in mind, UNCTAD was actively contributing to a positive or proactive trade agenda for developing country negotiators. The central focus of a development round should be on industrial countries opening up their markets to developing countries where the latter had competitive advantages, and redressing the imbalance of past negotiations.
These were no ideological arguments, nor academic lectures about free trade, Mr. Ricupero said. These were facts that needed to be overturned immediately if developing countries were to be encouraged to persist in and even to further the path of liberalization. This last goal should be achieved in a gradual, equitable and balanced way. Development should be as much female as export-led. In some countries, this had represented a huge leap forward in the participation of women in the money economy. The challenge was
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to make global arrangements in trade much more supportive of the greater participation of women in development, both as agents and as beneficiaries. At the threshold of the new century, globalization appeared as an unfinished business, a work in progress, a process that could still be steered and shaped by human beings according to human values. It was a duty to take this opportunity in both hands if the shape of things to come was to be one that would help men and women to achieve basic security and to lead an accomplished life of affection and productive work.
DAVID HARTRIDGE, Director-in-Charge of the World Trade Organization (WTO), said the agenda was still being set for the WTO's third Ministerial Conference, which would begin at the end of November in Seattle in the United States, but meanwhile developing countries had identified a number of problems relating to the implementation of existing commitments of WTO members. Among these problems were high levels of protection and support of agriculture in industrialized countries; continued high tariffs, tariff peaks and tariff escalation in industry; and lack of meaningful liberalization in sectors related to textiles and clothing. There was an argument that existing commitments should be fully implemented before new ones were negotiated, but there was no contradiction between implementation and negotiation.
Trade negotiations were not conducted for their own sake or even for the sake of producers of goods and services, Mr. Hartridge said; their value was to be judged in terms of their effects on human welfare. There was no doubt that the WTO and its predecessor, the General Agreement on Tariffs and Trade, had made a major contribution to the eradication of poverty over the last 50 years by removing barriers to trade and establishing a legal basis for international trade relations. But that message clearly had not got through to everyone; there was much public misunderstanding and there had been demonstrations against the multilateral trading system; there probably would be further demonstrations in Seattle. There were real concerns about the impact of globalization, and those concerns were shared by many good people. Social concerns mattered greatly to the WTO's member governments, and it had to be stressed that trade liberalization had fostered economic growth that had brought enormous benefits to the people of the world, especially the poor. It had its costs, but to suggest that poor people and poor countries would be better off if there were less trade and less foreign investment, which seemed to be the implementation of some of the polemics heard, was obvious nonsense.
In conclusion, Mr. Hartridge said that if the new round which WTO members would launch in Seattle did result in further liberalization, it would promote employment and it would help to end the marginalization of the poorest countries in the world. Trade policy was not the answer to all the problems of these countries, nor to the problem of poverty, but good trade policy could help and bad trade policy -- especially that which sought to isolate economies -- could be disastrous.
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Discussion
Members of the panel answered questions from the floor on, among other things, widening income disparities; rising unemployment; improved coordination between the WTO and the Bretton Woods institutions; balancing the benefits of free markets with the need for rules and oversight; and liberalization of trade in agriculture.
MARK MALLOCH BROWN, Administrator of the United Nations Development Programme (UNDP), said that the United Nations had helped set the international standards which were the basis for the global consensus forged on social issues at the international conferences of the 1990s. These standards were shared by the Bretton Woods institutions. The United Nations system, including the Bretton Woods institutions, must work together with greater efficiency and coherence to be a strong partner of developing countries as they took up the development challenge. In the new millennium, thanks to this strategic convergence of views, the world could look forward to a still more vibrant and productive collaboration between the United Nations and the Bretton Woods institutions. The potential also existed for an important new partnership that would respond to the needs of national authorities at the country level.
Responding to a question on employment, Mr. Ricupero said the development of trade was not a value in itself to be perused. It had to generate employment. The problem of employment had multiple causes and a series of measures had to be taken to overcome unemployment. Flexibility was only one answer, among others.
Mr. Camdessus, speaking on cooperation between the United Nations system and the Bretton Woods institutions, insisted on the necessity of putting discipline into institutional creativity. At the same time, coordination could also be an obstacle to that creativity. Coordination was good, but it should always be asked whether cooperation in certain areas was necessary for further progress. Concerning the United Nations system and the Bretton Woods institutions, they should always make sure that their actions were mutually reinforcing.
Mr. Wolfensohn said the World Bank had made important progress in the area of equity between men and women within the organization.
And Mr. Somavia said he regretted the passive resistance, and sometimes cynicism, that sometimes women had to face in the workplace.
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