INTERNATIONAL ECONOMIC COOPERATION DIALOGUE OPENS AT HEADQUARTERS; FOCUS ON INTEGRATING DEVELOPING COUNTRIES INTO WORLD ECONOMY

Fifty-sixth General Assembly

Plenary

4^th Meeting (AM)

INTERNATIONAL ECONOMIC COOPERATION DIALOGUE OPENS AT HEADQUARTERS;

FOCUS ON INTEGRATING DEVELOPING COUNTRIES INTO WORLD ECONOMY

The paramount task of reducing poverty and alleviating the suffering of so many of the world's people would be made more difficult by the current economic downturn, Deputy Secretary-General Louise Fréchette told the General Assembly this morning, as it began its high-level dialogue on strengthening international economic cooperation for development through partnership.  A primary objective of the Assembly, therefore, would be to pursue that task with even more commitment, she stressed.

“Responding to globalization:  facilitating the integration of developing countries into the world economy in the twenty-first century” is the focus of the two-day event intended to promote a deeper understanding of global issues and to provide impetus for international economic cooperation.

Governments, continued the Deputy Secretary-General, must take concerted action to encourage a revival of global economic growth.  That revival must be sustainable and, unlike in the past, spread more equitably.  Information technologies, she said, were a central feature of the modern era and driving force in globalization.  If developing countries were to compete in new global markets, huge efforts would be needed to improve access to a more advanced infrastructure.

General Assembly President Han Seung-soo (Republic of Korea) said that, indeed, the current phase of globalization was shaped by the fact that knowledge had become a source of competitive advantage.  Information and communication technologies (ICTs) had come to play a pivotal role in the emerging global knowledge-based economy and could be a powerful tool in the economic and social development of countries.  Yet, the majority of the world’s population continued to live in poverty, and many countries had yet to reap the full benefits from the ICT revolution.

The globalization process, noted Pakistan’s representative, was asymmetric, with some winners, but many losers.  Developing countries were convinced that their attempts to integrate their economies into the global economy stood "little chance of success" unless an enabling environment was created.  In the area of trade, the rules of the game were unequal in construct, and inequitable in outcomes.  Some countries had the power to set the rules and invokethem, but the weak and vulnerable had neither.

The United States representative said that the ultimate responsibility lay with the developing countries themselves.  Development assistance was a hand up, not a hand out or a crutch.  Developed countries could be supportive, but it was up to the developing countries to put into place the economic policies and governance structures that mobilized internal and external resources and maintained peace and stability.

For the least developed countries, said South Africa’s representative, taking advantage of opportunities offered by globalization was “not a question of difficulty, but rather one of impossibility”.  While a massive increase in world trade was among the benefits of globalization, the uneven playing field had to be levelled.  Developing countries needed better opportunities to gain access to global markets.

Speaking on behalf of the European Union and associated States, the representative of Belgium stressed the need for more innovative partnerships, giving particular attention to the least developed countries.  If developing countries were to benefit fully from the boom in global trade, they must first be members of the World Trade Organization and given technical assistance to operate effectively therein.

Statements were also made this morning by the representatives of the Russian Federation , Mexico, Iran (on behalf of the “Group of 77” developing countries and China), Saudi Arabia, Republic of Korea, Morocco, China, Romania and Algeria.

The high-level dialogue will continue at 3 p.m. today.

Background

The General Assembly met this morning to begin its two-day high-level dialogue on strengthening international economic cooperation for development through partnership.  Discussions will focus on the theme of "Responding to globalization: facilitating the integration of developing countries into the world economy and generating new public and private financing resources to complement development efforts". 

The high-level dialogue on development through partnership constitutes the intergovernmental follow-up to, and assessment of, the Agenda for Development, adopted by the Assembly in 1997.  The Agenda provides that such a dialogue should also be used as an opportunity to discuss new and emerging issues concerning international cooperation for development. 

The dialogue is intended to promote a broader and deeper understanding of global or transboundary issues and to provide impetus for the promotion of international economic cooperation for development.  The dialogue should not be seen in isolation, but rather as part of the broader intergovernmental process that encompasses major United Nations conferences and summits, especially the Millennium Summit, and the regular work of intergovernmental bodies, especially the Second and Third Committees of the Assembly, and the Economic and Social Council. 

The outcome, in the form of a President's summary, should constitute a contribution to the implementation of the Agenda for Development and other relevant intergovernmental processes.  It should stimulate follow-up by governments, intergovernmental organizations, non-governmental actors and other development partners, and enrich and move forward the policy debate on development issues.

Statements

The President of the General Assembly, HAN SEUNG-SOO (Republic of Korea), said that under the overarching theme of globalization, two crucial sub-themes were on the table.  The first covered two issues of importance -- the integration of developing countries into the world economy and generating financial resources.  The new millennium was characterized by shrinking distances, instant news and communication, short production cycles and unprecedented wealth creation. 

On the other hand, globalization was also characterized by growing development gaps both among and within countries, he said.  While the international community had done much to promote the integration of developing countries into the world economy, it must address the legitimate concerns about the marginalization of developing countries, which had been unable to enjoy the full benefits of globalization.

The question of financing for development took on new urgency in the follow-up to the series of global conferences and summits convened by the United Nations in the 1990s, he said.  Those events set out a multitude of goals and targets and comprehensive action plans at the national, regional and international levels to realize a holistic vision of development.  In that regard, he stressed the

significance of the International Conference on Financing for Development, which would take place in March of next year in Monterrey, Mexico. 

The second sub-theme, he said, was closely related to the first one.  Globalization had been recognized as multi-faceted in nature, and the current phase of globalization was shaped by the fact that knowledge had become a source of competitive advantage.  Information and communication technologies (ICT) had come to play a pivotal role in the emerging global knowledge-based economy.  ICT could be a powerful tool in the economic and social development of countries, societies and individuals by opening up new avenues for trade, commerce and employment. 

Yet, he continued, the majority of the world’s population continued to live in poverty, and many countries had yet to reap the full benefits from the ICT revolution.  Closing the digital divide among and within countries was an enormous task and, therefore, could not be the sole responsibility of one group of stakeholders.  Basically, governments had the primary responsibility for promoting the well-being of their people.  However, the public sector alone could not provide all the answers for the complex problems of globalization.  Civil society and the private sector not only had a stake in development, they had the necessary ideas, perseverance and creativity to surmount obstacles and find solutions to the challenges faced.

LOUISE FRECHETTE, Deputy Secretary-General, said the Assembly's dialogue on cooperation for development was meant to shed new light on the subject -- highlighting the potential challenges of globalization, as well as stressing partnership and mutual benefit rather than conflict.  On previous occasions, including the Millennium Assembly and the Third United Nations Conference on the least developed countries (LDC), extreme poverty had been identified as one of the most urgent challenges of the new century.  The paramount task of reducing poverty and alleviating the suffering of so many of the world's people would be made more difficult by the current economic downturn. The Assembly must therefore pursue that task with even more commitment. 

Right now, she continued, governments must take concerted action to encourage a revival of global economic growth.  It would be vital to ensure that such a revival was sustainable and that, unlike in the past, economic growth was spread more equitably.  Developing countries must be given a fair chance to compete in the world marketplace.  That would happen only if developed countries did more to open their markets and when developing countries improved their capacity to produce and export goods and services at competitive prices.  In that regard, many developing countries would need technical assistance, but they would also need to recognize and remove the barriers to free exchange and investment that still existed in the developing world.

In that context, it was more important than ever to seize the opportunity offered by the upcoming meeting of the World Trade Organization (WTO) in Qatar. States must use that occasion to fully implement the commitments made at the Uruguay Round, as well as to launch a new round of trade negotiations that could hopefully be dubbed a "development round".  That should help restore the momentum of open markets and, at the same time, give genuine priority to the concerns of developing countries.  She added that the Assembly had identified two other subjects for the day's discussion: public and private financing sources, and (ICT).  The Assembly would hear new ideas on financing for development, including those contained in the report of the Secretary-General's high-level panel.

Information technologies were a central feature of the modern era and driving force in globalization, she said.  If developing countries were to compete in new global markets, huge efforts would be needed to improve access to more advanced infrastructures.  The Assembly should look to the United Nations ICT Task Force for recommendations on ways to bridge the global digital divide and foster opportunities for all.

SERGEY ORDZHONIKIDZE (Russian Federation), said eradication of poverty and prevention of marginalization, particularly of LDCs, greatly depended on deeper involvement of developing countries in international trade and expansion of productive investment into the real sector and infrastructure.  He supported initiatives to improve the LDC's access to world markets.

Russia had long given considerable tariff preferences to developing countries, he said.  Most products originating from developing countries were imported at a reduced customs rate of 75 per cent of the basic tariff.  Such preferential measures were essential for expanding mutually advantageous trade and economic cooperation and facilitating the resolution of vital development problems.  His country accorded even greater trade preferences to the LDC's.  At the moment, nearly all products from those countries were imported to Russia duty-free.

He added that information and communication technologies had considerable potential in terms of providing assistance to developing countries.  The information revolution entailed not only the enhancement of opportunities, but also evident challenges and risks.  The most important task was to make all the necessary efforts to have the information technologies serve the interests of all countries.  The international community had a special responsibility for turning the information technologies into a factor of development, rather than broadening the “digital divide” between countries and regions.

BAGHER ASADI (Iran), on behalf of the “Group of 77” developing countries and China, said that the integration of developing countries into the world economy in the twenty-first century should be seen as a comprehensive process, based on cooperation and partnership.  For a smooth integration it was vital to have an open, rule-based, transparent and non-discriminatory multilateral trading system, as well as increased flows of foreign direct investment and their equitable distribution among developing countries.

Existing institutional arrangements and multilateral cooperation in the areas of international monetary, financial and trading systems were lagging far behind the process of economic and financial integration at the global level, he said.  Enhancing the coherence of those systems could contribute enormously to the smooth integration of developing countries into the world economy.  Regional arrangements and cooperation was another area which could help developing countries in their quest for integration.  It should be stressed, however, that a conducive global environment was a precondition for integration of members of regional arrangements into the global economy.

What needed to be done was clear, he said.  The potential of ICT should be utilized towards the long-term comprehensive development of the developing countries.  The aim should be to assist those countries in catching up with global development and to integrate into the world economy as effectively and expeditiously as possible.  The existence and provision of the necessary infrastructure and capacity went beyond mere access to a computer set connected to the Internet.  They also dealt with some fundamental issues and problems, such as the existence of a well-equipped telecommunications system and technological skills to utilize, support and administer information technology facilities.

While emphasizing the importance of comprehensive national actions for establishing the necessary capacities and infrastructure, he said it was crucial to have strong international support by international and multilateral institutions, particularly the United Nations, the World Bank, regional banks and other development partners.  The recently established ICT Task Force should receive every assistance in devising appropriate policies at the global and regional levels to promote universal access to knowledge and information.

JEAN DE RUYT (Belgium), speaking on behalf of the European Union and associated countries, stressed the need for more innovative partnerships, giving particular attention to the least developed of the developing countries.  If developing countries were to benefit fully from the boom in global trade, they must first be members of the World Trade Organization.  Developing countries must be given technical assistance in order to operate effectively within the World Trade Organization.  A special effort must also be made for the LDC's with regard to trading preferences, through such projects as the European Union initiative "Everything but Arms".

Confidence levels were important for flows of finance, he said, and a clear consensus needed to be reached, in consultation with civil society, on such factors as legal protection and non-discrimination. That was essential to ensure that foreign direct investment flourished.  With regard to corruption, he suggested that international legal instruments be adopted to fight the scourge. Such instruments would facilitate the repatriation of the proceeds of unlawful operations, transferred abroad.

The European Union reaffirmed its commitment to reaching the target of 0.7 per cent of gross national product(GNP) for official development assistance (ODA) as soon as possible.  ODA remained a significant source of development finance for a number of countries and should be backed up by the private sector and local public bodies, he said. 

To bridge the digital divide, more innovative approaches were required.  It was vital that the telecommunications market be integrated and liberalized without delay, so as to lower the cost of access to the internet.  Given the transnational nature of the World Wide Web, it was also essential that governments cooperate on such issues as copyright, computer security, electronic trading standards, legal and tax questions and combating computer crime.  Information technologies were an ideal tool of transparency and governance.  One of the ways of bridging the digital divide was therefore to focus on the promotion of e-government,which would reduce corruption, open up isolated communities and create new mechanisms for participation and involvement.

FAWZI BIN ABDUL MAJEED SHOBOKSHI (Saudi Arabia) said that the twentieth century had been one of bloody wars and conflicts, but also one of great discoveries and advances in science and technology.  With the demise of the cold war, ideological divisions had ended.  Humanity had started to achieve its legitimate aspirations to realize peace and security.  Yet, the facts in the international arena indicated an apparent division between the rich and the poor, with only a handful of States enjoying the fruits of technological advance.  A large portion of the world’s population continued to live in poverty.

Globalization was not a new phenomenon, he said. It had developed over the passage of time and was characterized by an increased interdependence between States, economies and populations.  It had brought great technological advances and was a great asset in combating poverty and promoting well-being.  The developing countries could not accept that the dividends of globalization were restricted to rich countries, while the poor continued to suffer.  Globalization had widened the gap between the rich and the poor.  The opportunities provided by it were not evenly distributed.

The widening gap between States was the reason why the world was looking for fair trade, instead of free trade, he said. The international community was calling for a constructive partnership, without exclusion or marginalization.  The developing countries did not benefit from the advantages of the multilateral trading system.  There was a dire need to achieve the global nature of the WTO.  The admission of developing countries into the WTO should be facilitated.

Criticizing governance in developing countries and providing insufficient resources to those countries would not achieve development goals, he said.  New and innovative resources were needed to finance development, such as from reducing military expenditures.  Reducing the digital divide would not be achieved unless technological justice was achieved.  There could be no security without sustainable and comprehensive development.

NORMAN NICHOLSON (United States) said delegates were assembled today for a dialogue on how to improve the condition of mankind through reducing poverty, enhancing cooperation and providing dignity and opportunity to all.  The events of 11 September constituted a rejection of the very principles of dialogue, partnership and the fundamental unity and dignity of the human condition.  In that regard, the current meeting could not be more timely.  The United States would renew its commitment to global economic growth through support for a rules-based international trading system and assistance to poorer countries to advance policy and institutional reform, agricultural development, investment in human capital, and trade-capacity building.

For greater aid effectiveness, the development efforts of the United States would be increasingly implemented through the Global Development Alliance (GDA), a new development financing model for the twenty-first century.  The Alliance was based on a recognition of changes in the environment of economic development assistance.  Governments, international organizations, and multilateral development banks were no longer the only or even the principal development assistance resources; nor was official development assistance.  For example, in 1999, net total resource flow from the United States to developing countries and multilateral development organizations amounted to over $50 billion.  Of that,

over $36 billion came from American private capital flows and private grants by non-governmental organizations (NGOs).

He added that private capital flows could and would vary, depending on economic conditions in both the investing and in the recipient countries.  For that reason, it was imperative that recipient countries enacted policies to create an environment that attracted productive investment, both domestic and foreign, and why efforts to boost global economic growth, through increased trade for instance, were vital to the development efforts of all countries. He added, however, that the ultimate responsibility lay with the developing countries themselves.  Development was a hand up, not a hand out or a crutch.  Developed countries could be supportive, but it was up to the developing countries to put into place the economic policies and governance structures that mobilized internal and external resources and maintained peace and stability.

DUMISANI KUMALO (South Africa) said much had been learned in recent years about the workings of globalization.  Among its benefits had been a massive increase in world trade.  The uneven playing field, however, had to be leveled.  For the LDC's, taking advantage of opportunities offered by globalization was “not a question of difficulty, but rather one of impossibility”.

The Millennium Summit had acknowledged the enormity of the task and had identified the prerequisites for creating conditions where sustainable development was possible, he continued.  Since then, there had been progress in debt relief and initiatives for the LDCs, for whom free market access in everything but arms was progress.  Yet those initiatives, however, had not touched the vast majority of the world’s poor people.  Africa had realized that both the developed and developing world needed to take steps to address the huge disparities in development between the North and South.  With the New African Initiative, Africans had identified for themselves the preconditions for sustainable development, including the peaceful resolution of conflicts and the promotion of democratic values, along with sound transparent governance.  Seeking partnerships with the developing world was equally important.

Developing countries needed better opportunities to gain access to markets, he said.  Increased trade opportunities implied increased investments.  That, in turn, would lead to economic growth, greater production and larger markets to benefit everyone.  Those conditions would come about by addressing the global financial architecture and the issue of global governance.  Financial institutions must serve the needs of all members.  They must also take more significant steps to correct historical imbalances.

SUN JOUN-YUNG (Republic of Korea) said that many developing countries, lacking the capacity to tap into the benefits of globalization, had become marginalized. Given the structural and financial difficulties of most developing countries, development disparities and digital gaps would be further aggravated unless the international community took concerted action with genuine partnership.

On the topic of information technology, he said the growing digital divide in the connectivity, capacity and content of such technology could undermine the development potential of developing countries.  Confronted with that challenge, bold policies for developing human resources and institutional capacity needed to be adopted.  In the public sector, rules and regulations should be devised to provide an environment that would attract investment for the promotion of infrastructure development and local content.  In addition, the problems of cyber crimes and associated illegal activities facilitated by the use of information technology should also be addressed.

The United Nations could play a unique role in promoting public awareness of the wider applications of information technology for development and poverty eradication in developing countries.  The United Nations system should strive for greater coherence and consistency in its activities in the field of information technology.  

MOHAMED BENNOUNA (Morocco) said that globalization, as a key and unavoidable feature of the new millennium, required a number of supporting and adjustment measures to develop into a genuine trigger of prosperity for all.  Special priority should be given to financing for development and access of developing countries to information and communication technologies, in order to bridge the gap between developed and developing countries.  Despite more than a decade of calls by developing countries for financing for development, the resources made available thus far had been inadequate and had not allowed those countries to cope with the growth in population and, above all, to establish sustainable development for all human beings.

He highlighted the need for international action aimed at ensuring economic and social stability and containing the threat of recurring crises.  The Millennium Declaration had eloquently conveyed a clear message about the urgency of adopting a resource mobilization strategy and pooling efforts for development financing.  He hoped that the upcoming conference would be a turning point towards a commitment on all levels along that path, to be followed by concrete actions.  National resources must be mobilized and the countries themselves should: adopt sound macroeconomic policies; make efficient and targeted social expenses; establish good management of public funds; and create a favourable environment for private investment, both national and foreign. 

Such worthy efforts by developing countries required global support mainly through market access, special and differentiated treatment, increased ODA, and debt reduction, he said.  Indeed, the international financial architecture should be reformed to promote a predictable and stable climate that could support development and growth strategies in developing countries.  The tremendous progress achieved in the area of information and communication technologies might contribute significantly to development through rapid and affordable access by developing countries to all fields of human activity.  In that respect, a fair and equitable use of intellectual and industrial property rights was necessary.

SHEN GUOFANG (China) said that equitable global governance was critical, in order to integrate developing countries into the world economy.  Developed countries should consider the long-term objective of global prosperity and support the full participation of developing countries in the formulation of rules for the international economic system.  It was also important to provide sufficient funding for development.  ODA should be provided at the rate of 0.7 per cent of developed countries' GNPs, with realistic conditions attached and procedures streamlined.

Developing countries, he said, should take measures to attract private capital, while developed countries should make efforts to channel more private capital into developing countries.  The stabilization of the financial order of those latter countries was necessary for that to be accomplished, as was opening markets for their products.

The capacity of developing countries in ICT must also be enhanced, he said, both through internal development of strategies and external assistance.  In that area, human resources and infrastructure must be developed in coordination, and the United Nations should play an important role in encouraging ICT development that fosters integration into the world economy.  Recently, China, in collaboration with the Organization, conducted conferences for that purpose.

ALEXANDRU NICULESCU (Romania) said that even after the attacks in New York and Washington, D.C., convening today’s dialogue on the formidable challenges of globalization and its social and economic impacts was essential because of the serious problem “marginalization” posed to developing  countries.  The change in the world economy was linked both to the growth of the Internet and to the growth in the power of information, which meant that knowledge, ideas and brainpower were becoming the world’s main economic resources.  The “ICT revolution” would offer huge potential for human and societal progress, because business no longer needed to take place in highly developed, densely populated areas.

He said anybody, anywhere could play an active role in the new world economy, but that depended on a few essential conditions, such as the availability of a powerful, seamless communication infrastructure, and digital literacy, as well as bold minds, an innovative spirit, and vision.  To maximize the benefits of ICT for development, interrelated factors such as building human capacity, creating incentives for enterprise, and increasing competition among telecommunications and Internet-related businesses must be addressed.  To enhance its own integration into the global information network, Romania had taken steps, such as launching important laws and creating a government group on ICT.  Because of the lack of available public funds, the private sector should forge a crucial partnership with the public sector and invest in “e-development” in order to build an information society for all.  Also, to help ICT from increasing the “digital divide”, the United Nations must play a catalytic role by bringing stakeholders together.  If that were not done now, when would it be done?, he asked.

MIGUEL HAKIM SIMON (Mexico) said globalization had created new opportunities for growth and development and new possibilities for promoting international peace.  It had also shown the world the importance of including all in the benefits of the global economy and the risks of excluding those in the community of nations.  Not all sectors had participated equally in the process of globalization.  Most developing countries had not been able to take advantage of globalization’s benefits.  Such exclusion had worsened disparities both within nations and around the world.  Thus far, globalization had not contributed tangibly to distributing wealth and ending disparities -- and that must be corrected.

Globalization without opportunities for developing countries could create dangerous imbalances and make the world less comfortable for all, he said.  Possibilities for recession had also increased and could spread quickly unless measures were taken to stop it.  Such measures had included the lowering of interest rates in the United States and other countries.  Cooperation and international agreement were prime instruments to promote the well-being of people in the globalized world.  There was a need for resolute action to mobilize resources, which were the basis of growth and development.  Such action included measures to address foreign debt.

The United Nations must examine the growing interdepedence of countries, he said.  Decisions of the most developed countries had a significant influence on the world market and on developing countries.  In that regard, Mexico reiterated its appeal to the international community, the United Nations system and the to the Bretton Woods institutions to contribute to the preparation process for the International Conference on Development Financing, to be held in Mexico in 2002.  The well-being and dignity of persons should be at the heart of international action in that regard.

ABDALLAH BAALI (Algeria) said that information technology in the new economy would determine access to the labor market to a great degree.  Globalization offered a historic chance for developing countries to catch up to the developed countries.  Information technology could help in that process by controlling costs of production and improving international trade.  Such technology also promoted knowledge of the world’s markets and increased access to them.

He said that information technology could be a driving force for sound, sustained economic growth.  Developing countries wanted to take advantage of such technologies, although they must first build the infrastructure needed for such capacities.  Developing countries were looking to official development assistance in order to build such an infrastructure.

The recovery of Africa was the primary responsibility of the countries concerned, he added.  However, he believed that recovery, in the initial stages, required resources in terms of development assistance and deeper debt relief measures. Debt relief would allow greater resources for social development, education and health care, which were need to bring these countries into the new economy.  The Heavily Indebted Poor Countries Initiative was a positive step in that direction.

SHAMSHAD AHMAD (Pakistan) said that since he was addressing the Assembly for the first time since the horrendous tragedy that struck the greatest city, New York, and Washington, D.C. he wished to express his profound sympathies and condolences to the Government and people of the United States and to all of the victims in that colossal loss of life.  He also associated himself with the statement of the Group of 77 developing countries and China.  Globalization was reshaping the world's economic, social, cultural and political values, he said.  What was emerging was a whole new paradigm of creating a borderless world with an unhindered circulation of goods and services.  Globalization had opened enormous opportunities for development, but there was another side of the picture. Undeniably, he said, globalization was being experienced differently and unequally.

He said that the globalization process was asymmetric, with some winners, but many losers.  Developing countries were convinced that their attempts to integrate their economies into the global economy stood "little chance of success" unless an enabling environment was created. That was possible only by customizing the process of integration to the specific needs of a country, and the capacity of

its existing institutions and industries.  They must also be involved in preparing the rules of the game.  Meanwhile, stark inequities afflicted the multilateral trading system.  Consequently, developing countries had not gained any meaningful market access in the key areas where they had a clear comparative advantage, such as in textiles and agriculture.

Trade liberalization demanded the elimination of all barriers, requiring equitable global regulations, he said.  Sadly, the reality was grossly different.  The rules of the game were unequal in construct, and inequitable in outcome.  Some countries had the power to set the rules and invoke them, but the weak and vulnerable had neither.  As a result, national boundaries did not matter for trade or capital flows, but did matter for technology flows, intellectual property regimes and movement of labour.  Other aspects of the development process were also crucially important, especially financing for development. The Monterrey Conference was a golden opportunity to channel the forces of globalization in support of development.

* *** *