NINTH MINISTERIAL MEETING OF LEAST DEVELOPED COUNTRIES CALLS FOR CANCELATION OF DEBT

Press Release
DEV/2219

NINTH MINISTERIAL MEETING OF LEAST DEVELOPED COUNTRIES CALLS FOR CANCELATION OF DEBT

Creditor countries and institutions should cancel all outstanding debt owed by least developed countries, according to a Declaration adopted at the ninth annual ministerial meeting of the least developed countries held at United Nations Headquarters on 29 September. The meeting was attended by more than 20 Foreign Ministers and senior officials from least developed countries and high-level representatives from the United Nations system and international financial institutions, including, for the first time, the Director-General of the World Trade Organization (WTO).

Addressing the meeting, United Nations Secretary-General Kofi Annan said an institutional framework must be created to enable least developed countries to participate in and benefit from globalization. The international community must meet the needs of least developed countries in terms of official development assistance, debt relief, market access and foreign investment, and work for the elimination of tariff barriers from least developed country exports. The third ministerial meeting of the WTO in November provided an important opportunity in that respect, he stressed.

According to representatives of least developed countries, the external financial situation they faced was aggravated by a heavy burden of debt and debt-servicing, which constrained development efforts and undermined credibility to mobilize external private flows.

Measures in favour of least developed countries should be rendered binding by becoming an integral part of the rules governing the multilateral trading system, the Ministers declared. They stressed that in implementing existing multilateral trade agreements and in future negotiations, the international community should ensure that obligations placed on least developed countries were consistent with their level of development and capacity. Noting that significant scope existed for improving market access conditions for least developed countries, they called for early action to remove tariff peaks and tariff escalation and for all trading partners to immediately implement the initiative for duty-free treatment for all products of export interests to least developed countries.

The Ministers reaffirmed their commitment to pursuing macroeconomic and sectoral policies conducive to promoting growth and

- 2 - Press Release DEV/2219 11 october 1999

development and eradicating poverty in their countries, but noted with grave concern that the declarations, promises and commitments in favour of their countries had, to great extent, failed to materialize. As a result, national policy reforms and adjustment programmes often did not yield the full benefits, and in some cases had a negative impact.

The Third United Nations Conference on Least Developed Countries, to be held in 2001 and hosted by the European Union, should aim at achieving concrete and binding global and country-level commitments on the part of the countries concerned and their partners to eradicate their extreme poverty within the first decade of the century, according to the Declaration. That Conference should promote such countries' positive integration into the world economy and the international trading system in a measurable and time-bound manner. Relevant upcoming global meetings and conference, including the third WTO Ministerial Conference, the Tenth United Nations Conference on Trade and Development (UNCTAD), reviews of major global conferences, the Millennium Assembly and the International Intergovernmental Consideration on Financing for Development should all contribute to the preparatory process for that Third United Nations Conference.

The Ministers decided to convene a Ministerial preparatory meeting to formulate positions on issues before the Conference, and requested the Government of Bangladesh to host the meeting, by other terms of the text. They asked the Conference Secretary-General to mobilize resources for holding a Ministerial Meeting and for participation of delegations from least developed countries. They expressed support for his actions to launch the preparatory process closely involving all relevant stakeholders, including country representatives, development partners, civil society representatives including non governmental organisations and the private sector and key multilateral agencies.

As many least developed countries have been ravaged by humanitarian and natural disasters and environmental emergencies, the Ministers called on bilateral, intergovernmental and non-governmental organizations to continue supplementing national efforts in tackling emergencies. Other parts of the Declaration concern the geographical handicaps faced by land-locked least developed countries, and small island developing States, which compound existing structural deficiencies and difficulties in integrating economies.

The ninth Ministerial Meeting reviewed socio-economic developments and progress in the implementation of the Programme of Action for least developed countries in the 1990s (adopted at the Second United Nations Conference on Least Developed Countries (Paris, 1990); preparations for the Third United Nations Conference on Least Developed Countries, scheduled for 2001; and follow-up to the initiative under the Integrated Framework for Trade Related Technical Assistance for least developed countries. Further, it considered preparation for the following events: the Third Ministerial Meeting of

- 3 - Press Release DEV/2219 11 October 1999

the WTO (1999); UNCTAD X (2000); South Summit (2000); Millennium Summit (2000); and the International Intergovernmental Consideration on Financing for Development (2001).

The Meeting was addressed by the Foreign Ministers of Bangladesh (as coordinator of least developed countries), Madagascar, Sudan, Mozambique, Malawi, Benin, Nepal, United Republic of Tanzania and Bhutan. Also speaking were: the Minister of State of Solomon Islands; the Minister, Office of the President of The Lao People's Democratic Republic; the acting Foreign Minister of Afghanistan; and the representatives of Guyana (speaking for the Group of 77 developing countries and China), Zambia, Maldives and South Africa (as Chairman of the Non-Aligned Movement).

The Meeting was also addressed by the Director-General of the WTO, the Deputy Secretary-General of UNCTAD, the Associate Administrator of the United Nations Development Programme (UNDP) and representatives of the World Bank and the International Monetary Fund.

There are currently 48 least developed countries, with a combined population of 570 million (1994 estimate). The first list of these countries was approved by the General Assembly in 1971, with 24 members. The criteria used to determine the countries in greatest need were per capita gross domestic product (GDP), share of manufacturing in total GDP, and the adult literacy rate. Subsequently, the criteria was revised to include the augmented quality of life index, the economic diversification index and population size. At the same time, the number of countries included in the list rose steadily, reaching 48 in 1994. In the last 25 years only Botswana has succeeded in moving from this group, doing so in 1994.

* *** *