HEADQUARTERS PRESS BRIEFING TO LAUNCH UNCTAD REPORT ON LDCS

HEADQUARTERS PRESS BRIEFING TO LAUNCH UNCTAD REPORT ON LDCS

The world’s rich countries have been urged to respond swiftly to arrest the downward economic spiral of the world’s poorest countries.  The call was made at a Headquarters briefing today by the prominent American economist Jeffrey D. Sachs, the Secretary-General's Special Adviser on the Millennium Development Goals, and Under-Secretary-General and High Representative for the Least Developed Countries (LDCs), Landlocked Developing Countries and Small Island Developing States, Anwarul K. Chowdhury.

The two officials said that unless the developed world came to the rescue of the world’s 49 poorest countries, the overall objectives of the Millennium Declaration would not be met.  Thirty-four of the 49 LDCs were in Africa.

They briefing marked the launching of a report prepared by the United Nations Conference on Trade and Development (UNCTAD), entitled “The Least Developed Countries Report 2002: Escaping the Poverty Trap”.  The report was launched simultaneously in New York and in Geneva, where UNCTAD Secretary-General Rubens Ricupero released it.  Press conferences to launch the report were also held in other major cities around the world.  It is the first comprehensive analysis of poverty in all of the world’s 49 least developed countries.

Among the least developed countries, according to the report, the incidence of extreme poverty was highest in those countries that depended on primary commodity exports for their economic survival and development.  It also warned that the number of people living on less than $1 a day in the world’s poorest countries would reach at least 420 million by 2015 if current economic trends continued.

Under-Secretary-General Chowdhury said the timing of the report’s release was particularly significant, first because of the approaching G-8 summit in Kananaskis, Canada.  As that summit would be focusing on Africa’s development, in the context of the development situation of the LDCs, it would be of special relevance.  Equally significantly, the report was coming out just before the Economic and Social Council takes up the annual review of the implementation of the Brussels programme of action for LDCs.  He hoped that the resulting focus would be useful to Member States when they began to discuss the setting up of mechanisms for the annual review.  The objective of the report was to put LDC issues high on the political agenda of multilateral and global meetings.  Through such efforts, LDCs would continue to get the attention they deserved. 

In the Brussels programme of action, correspondents were told, the issues of partnership had been emphasized strongly, and one aspect of that was the release of the current report to the media.  It was hoped the international media would give the report and its observations on the LDCs a high profile in their coverage and thus boost international efforts to give special attention to them.  The United Nations system and the international community had been focusing on the LDCs for the last 30 or 40 years, beginning with the 1968 UNCTAD-II meeting which proposed special measures for the LDCs.  But the situation had not improved.  The number of LDCs had continued to grow, said Under-Secretary-General Chowdhury. 

At last year's Brussels conference on the LDCs, it was decided to pursue the follow-up and implementation of the conference programme of action in a

coordinated and methodical way.  “That resulted in the creation of the office that I am holding.  We hope the creation of that office will make a difference and will improve the situation regarding the LDCs”, he said. 

Mr. Sachs, appointed in January by Secretary-General Annan to lead the campaign for the achievement of the Millennium Development Goals, said he hoped the UNCTAD report would be read by those who really needed to read the report -- lawmakers in the capitals of the wealthy countries, policy makers in the Bretton Woods institutions, and scholars specializing in LDC issues.

The thrust of the report, said Mr. Sachs, was "that too many impoverished countries are stuck in a trap of poverty that they will not get out of through their own resources.  And that unless there is truly international partnership, of the kind that we profess but don’t always act upon, the natural dynamics of international market forces will not relieve the mass suffering experienced by hundreds of millions of people”. 

The report says that saving rates are extremely low in poor countries because people without an "investable surplus" are fighting for survival.  “It shows that because there is no investable surplus, societies are eating their seed corn, as we say.”  They were even engaged in environmental destruction to stay alive -- cutting down forests, planting increasingly marginal fields, depleting soil fertility, and exhausting water aquifers.  Because of that trend, even what looked like production was actually eating into the ecological capital of those societies.  A large number of those impoverished countries were now on a downward spiral: not only were they not catching up, they were falling farther and farther behind the rich countries. 

Because development assistance in needed areas such as agriculture and health had fallen sharply over the last decade, conditions were worsening and life expectancy was falling in many places, Mr. Sachs said, and as a result, populations were succumbing increasingly to mass diseases such as the AIDS pandemic or the resurgence of malaria in large parts of sub-Saharan Africa.  Environmental degradation had proceeded rapidly.  And because of the way the trading system worked, those countries had not had the chance to gain a new foothold in more viable economic activities, he told correspondents.

Calling attention to the new "aid and trade" dual vision outlined in the report, a correspondent asked how much money it would take in terms of annual aid to make a significant difference for the LDCs.  Mr. Sachs said that recent studies, such as one done for the World Health Organization (WHO) some two years ago, indicated that the low-income countries required help in the order of about $25 billion per year -- or one tenth of one per cent of the donor-world gross national product (GNP) -- in order to fight the pandemic diseases and address other health crises.  “That’s one thousandth of the developed countries' GNP.  Twenty-five billion dollars per year, compared with $25 trillion of GNP.”

In response to another question, Mr. Sachs said that in general the LDCs received a very small share of aid even though they were the ones who most needed it.  And when an absolutely clear need came along, such as the fight against AIDS, the largest pandemic disease in modern history, almost no money was available for Africa until about two years ago.  There was not a single targeted World Bank programme from 1995 to 2000, and not even one loan programme for Africa.  “Things are starting to change", he said.  "But we just weren’t doing it for a long time.  And that’s why all the generalizations, I think, are a mistake, because you get what you invest in.  If you don’t invest in vaccines or in fighting AIDS or in drilling bore wells or doing other things, you don’t get results.  And the amounts

were very, very small.  And we come out of international conferences declaring the intention to do something -- and then slash aid.” 

He cited the era of the Clinton Administration in the United States, saying that despite all the promises to do more, that period had witnessed the sharpest drops in foreign assistance in modern United States history.  But, he added, “I do think that era is over because it didn’t work.  And I think the study makes absolutely clear why some combination of new policies is needed”.

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