SECOND COMMITTEE TOLD OF VITAL NEED FOR RENEWED CONFIDENCE IN TRADE LIBERALIZATION AS KEY FOR SUCCESS OF NEGOTIATIONS AFTER FAILURE AT CANCÚN

Fifty-eighth General Assembly

Second Committee

23^rd & 24^th Meetings (AM & PM)

SECOND COMMITTEE TOLD OF VITAL NEED FOR RENEWED CONFIDENCE IN TRADE LIBERALIZATION

AS KEY FOR SUCCESS OF NEGOTIATIONS AFTER FAILURE AT CANCÚN

Multilateralism, Non-discriminatory Trading System Important

For Spurring Economic Growth in Developing World, Says Morocco’s Delegate

Renewed confidence in trade liberalization as a key instrument of development was vital for the success of post-Cancún trade negotiations, Morocco’s delegate told the Second Committee (Economic and Financial) as it took up trade and development this morning.

Speaking on behalf of the Group of 77 and China, he stressed the importance of multilateralism and a non-discriminatory trading system in spurring economic growth, particularly in the developing world.  However, the international community must completely review the rules governing anti-dumping practices, expedite negotiations on agriculture, reduce and eliminate tariff peaks on non-agricultural products, and provide technical assistance for export industries of needy countries.

Similarly, Pakistan’s representative said it was time for an honest appraisal of the Doha agenda and objectives that would make it an actual development round.  They could include the genuine resolution of outstanding implementation; a commitment to eliminate tariff peaks and hikes for developing-country exports; development-oriented discipline on anti-dumping actions; and specific development commitments in trade and debt, finance and trade, and the transfer of technology.

He called for the creation of a down payment for developing countries to build confidence in the Doha round, saying it could include a moratorium on dumping and other measures against low-income developing countries, as well as a positive response to the African cotton initiative.  Moreover, the creation of a capacity-building fund of at least $100 million would demonstrate the international community’s commitment to helping developing countries enhance their ability to expand exports and trade.

Australia’s representative, speaking on behalf of the Cairns Group, said negotiators must immediately return to the table to hammer out urgently needed agricultural reform.  Seventy per cent of the world’s poor lived in rural areas and depended on agriculture for their livelihood.  While they struggled to survive on less than $2 a day, rich nations forked over $1 billion daily on farm subsidies.  Negotiators must end that imbalance by setting a date for eliminating export subsidies, reducing trade-distorting domestic support, improving market access for all products, and creating effective mechanisms to address the needs of developing countries, particularly in food security, rural development and poverty alleviation.

Rubens Ricupero, Secretary-General of the United Nations Conference on Trade and Development (UNCTAD) said the multilateral trading system had become a symbol of global economic interdependence, and that the economic fate of different regions and countries was more intertwined than ever.  Developing countries needed the system as a shelter against arbitrariness and a guarantor of fairness and equity in trade relations.  Trade was increasingly becoming a determinant of their economic growth and development as well as their ability to escape the poverty trap.

Echoing that sentiment, Anwarul Chowdhury, Under-Secretary-General and High Representative for the Least Developed Countries (LDCs), Landlocked Developing Countries (LLDCs) and Small Island Developing States, said developments in the international trade regime were vital for LDCs, LLDCs and Small Island Developing States.  Trade in such developing nations suffered from factors beyond their control, despite relentless efforts to reform their national economies, he said, noting that their share of international trade had fallen since the 1960s to a dismal 0.4 per cent.

General Assembly President Julian Hunte also addressed the Committee, saying that trade was also a major determinant of the economic well-being of nations that depended heavily on commodity exports to generate income.  A new development regime was needed to address their special needs.

The Committee heard UNCTAD’s Secretary-General introduce a report on International Trade and Development and a report of the independent Panel of Eminent Persons on Commodities.  The President of the Trade and Development Board introduced a report on that body, and the Director of the Development Policy and Planning Office in the Department of Economic and Social Affairs introduced a report on unilateral economic measures of political and economic coercion against developing countries.

In other business, Morocco’s representative introduced draft resolutions on science and technology for development; the needs of landlocked developing countries; the international financial system as it relates to development; the external debt crisis as it relates to development; the environment and sustainable development; implementation of the United Nations Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, particularly in Africa; the Convention on Biological Diversity; the international strategy for disaster reduction; protection of global climate for present and future generations of mankind; and implementation of Agenda 21.

Switzerland’s representative introduced a draft resolution on sustainable mountain development, Japan’s delegate introduced a text on the United Nations Decade of Education for Sustainable Development and Italy’s representative introduced a draft on training and research.  The representative of the United States introduced a text on cybersecurity and the protection of critical information infrastructures.

Also speaking today were the representatives of the Lao People’s Democratic Republic, China, Russian Federation, South Africa, Cuba and Bangladesh.

The Observer for the World Conservation Union (IUCN) also made a statement, as did a representative of the United Nations Industrial Development Organization (UNIDO).

The Second Committee will meet again at 10 a.m., tomorrow, Tuesday 4 November, to hear a briefing by Mark Malloch Brown, Administrator of the United Nations Development Programme (UNDP) on “Rebuilding Peace:  The Development Dimensions of Crisis and Post-conflict Management”.

Background

The Second Committee (Economic and Financial) met this morning to take up trade and development.  Before it was a report of the Trade and Development Board on its thirtieth executive session (document A/58/15 (Part I), which took place in Geneva from 2 to 4 December 2002.  The session focused on the theme “Escaping the poverty trap:  national and international policies for more effective poverty reduction in least developed countries (LDCs)”.

Among its agreed conclusions, the report says, the Board recommended increased efforts to ensure that LDCs achieve the poverty-reduction goals set out in the Brussels Programme of Action and the Millennium Declaration.  Among other things, this would mean achieving sustained economic growth that increased and eventually doubled average household incomes.  The Board also recommended that LDCs carefully consider the Least Developed Countries Report 2002, which calls for reducing poverty through long-term development strategies, including growth-oriented macroeconomic policies, investment–friendly environment, and vigorous trade diversification and promotion.  The Board also stresses the need for speedy implementation of the Heavily Indebted Poor Countries (HIPC) initiative, which should be supplemented by meaningful market access for LDCs.

In addition, the Board suggests that the international community work to overcome the negative effects of falling commodity prices, the report says.  It also recommends that aid flows be made more predictable, and that LDCs themselves monitor aid performance to improve its level, quality and effectiveness.

During panel discussions throughout the session, participants highlighted the scarcity of domestic resources in LDCs for promoting investment and productivity, as well as environmental degradation, the report states.  These problems were compounded by unsustainable debt burdens, declining financial flows, falling and unstable commodity prices and lack of market access for LDC exports.  Geographical disadvantages, including landlockedness, infertile soils and endemic diseases (notably malaria), were added problems for many LDCs.

Despite new promises made at Monterrey and Johannesburg, participants said, no “real financial partnership” of LDCs with rich countries, or sufficient science and technology collaboration had taken place, according to the report.  LDCs had yet to experience an “open and fair” trading system, problems of market access and tariff peaks continued, and rich-country agricultural subsidies had drastic effects on growth and poverty in poor countries.  Participants also noted weaknesses in the Integrated Framework and the HIPC initiative.  Financial resources currently committed to the Framework were inadequate ($10 million for 49 countries over seven years), given the urgent need to improve supply-side capabilities in LDCs.  The HIPC initiative had led to lower debt-service payments, but was hampered by deliberately over-optimistic export projections; the slow rate of some countries to arrive at completion point, when debt relief is irrevocably committed; and inappropriate conditionality.

The Committee also had before it the report of the Trade and Development Board on its twentieth special session (document A/58/15 (Part II), which took place in Geneva on 27 January 2003, which contains a decision on financing for experts from developing and transition countries to participate in expert meetings of the United Nations Conference on Trade and Development (UNCTAD).  By that decision, the Board agreed that such participation would be financed through extrabudgetary contributions, when sufficient, or through a reserve fund.  Funds currently available to finance participation in expert meetings would make up the reserve fund and the process of obtaining extrabudgetary contributions for expert meetings in 2003 would begin immediately.

Also before the Committee was the report of the Trade and Development Board on its thirty-first executive session (document A/58/15 (Part III), which took place in Geneva on 10 March 2003 and contains a Board decision that official documents of the Joint Advisory Group of the International Trade Centre -- a combined effort of UNCTAD and the World Trade Organization (WTO) –- should be issued in the other two United Nations official languages, Arabic and Chinese, in addition to its current languages.

In addition, the Committee had before it the report of the Trade and Development Board on its thirty-second executive session (document A/58/15

(Part IV), which was held in Geneva on 28 July 2003.

Another document before the Committee was the Secretary-General’s report on unilateral economic measures as a means of political and economic coercion against developing countries (document A/58/301), which transmits views and other relevant information from States on unilateral economic measures as political and economic coercion against developing countries.  The report includes texts received from Argentina, Costa Rica, Cuba, Czech Republic, Iran, Libya, Syria, Thailand, Tunisia and Venezuela.

The Committee also had before it a note by the Secretary-General on the report of the Meeting of Eminent Persons on Commodity Issues (document A/58/401), held from 22 to 23 September 2003 in Geneva.  It recommends several short-term, medium-term and long-term steps to improve commodity market conditions and the lives of poor commodity producers through better crop management systems, among other solutions.  Proposals include equitable and predictable market access for key commodities from developing countries, addressing the oversupply of commodities, making compensatory financing schemes user-friendly and operational, strengthening capacity and institutions, and creating an International Diversification Fund.

The Committee also had before it a report of the Secretary-General on International trade and development (document A/58/414), the report of the Trade and Development Board (document A/58/154), and a paper on Construction of additional office facilities at the Economic Commission for Africa (document A/58/154).

Statement by General Assembly President

JULIAN HUNTE (Saint Lucia), President of the fifty-eighth session of the General Assembly, summarized the discussion of the 22 to 23 September meetings in Geneva of the Eminent Persons on Commodity Issues.  During those meetings, the eminent persons covered a broad range of issues, notably the long-standing dependence of many developing-country economies on export earnings from a few commodities.  The performance of commodities markets had a major impact on their ability to achieve sustainable development and the Millennium Development Goals. The commodities issue required greater attention by the international community, including the creation of a new development regime for commodity-dependent countries.

Introductory Statements

RUBENS RICUPERO, Secretary-General of UNCTAD, introduced the report on the International Trade and Development and that of the independent Eminent Persons on commodities issues.  Noting that multilateral trading system had become a symbol of global economic interdependence, he said trade flows between developed and developing countries had become increasingly significant and the contribution of developing countries to growth in world trade and sustained economic development had increased.  In 2001, developing countries relied on the markets of developed economies for about 57 per cent of their exports.  That same year, developing countries accounted for 48 per cent of Japanese exports, around 43 per cent of exports from the United States, and 34 per cent of exports from the European Union.  The economic fate of different regions and countries was more intertwined than ever.

Developing countries needed the multilateral trading system as a shelter against arbitrariness and a guarantor of fairness and equity in trade relations, he said.  Trade was becoming more and more a determinant of their economic growth and development, as well as their ability to escape the poverty trap.  Developed countries needed the multilateral trading system to engage developing countries in ever-expending circles of trade liberalization and openness, so that their economic operators could trade and invest with greater freedom, certainty, predictability and security across borders.  They also used the system as a checks-and-balances mechanism for one another in challenging policies and practices of their peers in the Organisation for Economic Cooperation and Development (OECD).

Calling Doha 2001 a milestone in the evolution of the multilateral trading system, he said all countries would gain through its core agenda on development.  Growth in developed countries would speed up, allowing them to offer new and expanding opportunities for the exports of both developed and developing countries.  The growth potential in some developed countries was likely to level off in the future, reflecting long-term demographic trends and high consumption. Developing countries, on the other hand, had a vast reservoir of untapped demand, which could give exponential impetus to growth in international trade and world economic expansion, with huge benefits for developed countries as well.  For that potential to be realized, the international community must make significant investments in overall development. 

ZHA ZUKANG, President of the Trade and Development Board, introduced that body’s report, which details its fiftieth session in October on interdependence and global economic issues from a trade and development perspective, capital accumulation, economic growth and structural changes.  He noted the persistently weak growth in developing countries and the disparity between rich and poor, saying the report provided an in-depth analysis of the links between fixed capital formulation, industrialization, and international competitiveness, among other factors, in the developing world.

He said the report revealed that developing countries had varying degrees of vulnerability to external shocks, be they weakened exports, falling international prices or other factors.  Latin America and the Caribbean were most affected by the international economic slowdown, Africa by falling commodity prices and poor inward capital inflows that had sparked a real crisis, and Asia by the management of development.  Applying a one-size-fits-all model to economic growth and management of developing nations was inappropriate.  He went on to detail the wide range of trade-related issues addressed in the report, including official development assistance (ODA), particularly for LDCs, debt relief and predictable market access, necessary global sustainable development and economic growth.

ANWARUL CHOWDHURY, Under-Secretary-General and High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States, said developments in the international trade regime were vital for LDCs, landlocked developing countries (LLDCs) and small island developing States.  Those countries deserved international support in overcoming specific disadvantages in an increasingly globalized world, which were largely due to a persistent lack of political will in the international community.  Trade in such developing nations suffered from factors beyond their control, despite relentless efforts to reform their national economies.  The share of LDCs in international trade had fallen from 3 per cent in the 1960s to the current 0.4 per cent, and small island developing States also had a share below one half per cent.

He said one positive development of the recent Cancún WTO meeting had been the emergence of several issue-based alliances among developing countries.  They included the grand alliance of the African Union, the African, Caribbean and Pacific Group and LDCs, and the Cotton Initiative of Benin, Burkina Faso, Chad and Mali, which had underscored the negative effects of agricultural subsidies.  Another development that would continue to support the most vulnerable countries was the activism of civil society, parliamentarians and the media. 

Several factors had affected the abilities of LDCs to take full advantage of market access preferences, he continued.  They lacked inherent domestic capacities, such as adequate market information and supply-side constraints, and suffered from security as well as political problems.  In addition, many non-tariff barriers had proved highly restrictive, bottling up the export potential of LDCs.  Stringent sanitary and phytosanitary standards and complex rules of origin, as well as domestic subsidies granted in developed countries had inhibited LDCs from gaining access to developed-country markets.  Other serious concerns in LLDCs were transit facilities and transport infrastructures, while the small size, vulnerability and isolation from world markets of small island developing States made their economies highly dependent on external trade. 

IAN KINNIBURGH, Director, Development Policy and Planning Office, Department of Economic and Social Affairs, introduced the Secretary-General’s report on unilateral economic measures of political and economic coercion against developing countries, saying it detailed the replies of 10 Member States that had reported on such measures.  Most said they had not applied such unilateral economic measures, which they viewed as inconsistent with international law and other aspects of international cooperation.  Some governments gave specific examples of measures applied against them and subsequent adverse impact on their nations. 

Statements

ABDELLAH BENMELLOUK (Morocco), speaking on behalf of the Group of 77 and China, said there was no alternative to multilateralism and a non-discriminatory trading system to spur economic growth, particularly in the developing world.  The success of post-Cancún negotiations would depend largely on the ability of nations to restore confidence in trade liberalization as a key instrument of development.

He said that process would require a complete review of rules governing anti-dumping practices, technical obstacles, sanitary and phytosanitary measures, trade-related aspects of intellectual property laws and preferential market access.  It was also necessary to expedite negotiations on agriculture, integrate agreements on textiles and clothing, reduce and eliminate tariff peaks on non-agricultural products, examine the coherence of financial, monetary and trading systems, provide technical assistance to the export industries of developing countries and resolve the cotton dispute.

ALOUNKEO KITTIKHOUN (Lao People’s Democratic Republic), speaking on behalf of the Group of LandLocked Developing Countries, said they reaped little from the world trading system, largely due to their remoteness from world markets.  The Almaty Programme of Action had laid down actions to assist LLDCs with trade by simplifying and standardizing trade and custom norms and procedures.  It had also stressed the need to bring more LLDCs into the WTO.  The recent trade meeting at Cancún was the first in which LLDCs had had to form a common position on trade negotiations on the basis of the Almaty Programme of Action. 

Noting that LLDCs priorities were trade facilitation and preferential market access for their products in international markets, he called for closer cooperation with the world community, especially WTO members.  Hopefully, WTO negotiations would be brought back on track as soon as possible, and strong interdependence in today’s globalizing world would eventually lead to a fruitful conclusion.  The rhetoric of trade as an engine for development would never prove itself by deeds without an open, fair, rules-based and equitable international trading regime. 

HUANG XUEQI (China) said that despite some progress, the world economy still faced uncertainty, further exacerbated by the collapse of the recent trade talks at Cancún.  The growing imbalance between rich and poor nations had widened due to high agricultural subsidies, market access barriers and inequities in the international monetary and financial systems.  While global trade had reached $6.2 trillion in 2002, many developing countries were not reaping trade’s full benefits.  Provisions for the preferential treatment of exports from developing countries had not been implemented effectively.

The elimination of high agricultural subsidies for farmers in developed countries should be the number one priority of future trade negotiations, he went on.  They continued to keep poorer nations at a major disadvantage.  China had done its part by eliminating export subsidies for many products since joining the WTO.  The creation of a new economic order based on fairness and equity was essential if the international community was serious about helping the developing world achieve the Millennium targets of sustainable development and poverty eradication.

VASSILY NEBENZIA (Russian Federation) said that the setback at Cancûn had proven that the international trading system was still far from perfect.  Stable, predictable and non-discriminatory access must be created for the goods and services of all nations.  The gradual removal of trade barriers and protectionism was essential to economic and social development.  Anti-dumping regulations against Russian exports had cost the Russian economy $2.5 billion annually, and hopefully they would be replaced with the standard procedure for Russian exports.

The WTO accession was a major priority for the Russian Federation, he said, adding that domestic laws would soon be brought in line with the WTO requirements.  The Russian Federation had lowered customs duties and given preferential treatment to imports from many developing countries, particularly LDCs.  The Russian Federation welcomed the creation of a comparative preferential trade scheme for LDCs, as called for during the Millennium Summit.

MUNIR AKRAM (Pakistan) said it was time for an honest appraisal of the Doha agenda, and stressed the need to identify objectives that would make it an actual development round.  They could include the genuine resolution of outstanding implementation; a commitment to eliminate tariff peaks and tariff escalation for developing-country exports; priority for the movement of natural persons in services liberalization; development-oriented discipline on anti-dumping actions; and specific development commitments in trade and debt, finance and trade, and the transfer of technology.

He also highlighted the need for a down payment for developing countries to build confidence in the Doha round.  It could include a moratorium on dumping and other measures against low-income developing countries, as well as a positive response to the African cotton initiative.  The international community should also make a visible commitment to capacity-building in developing countries in order to enhance their ability to expand exports and trade.  Such a commitment could take the form of a capacity-building fund of at least $100 million, jointly managed by the WTO, UNCTAD, the United Nations Development Programme (UNDP) and the World Bank.  In addition, the international community must agree on a more transparent and democratic decision-making process in the WTO.

BHAGWAT SINGH, Observer for the International Union for the Conservation of Nature and Natural Resources (IUCN) at the United Nations, said the recent WTO meeting at Cancún, and the eighteenth session of the Global Biodiversity Forum had highlighted the need for mutual support for trade and sustainable development objectives.  The Forum had made recommendations in three areas where international trade and international environment agendas coincided:  trade and sustainable livelihoods; risk, precaution and biosecurity; and the relationship between the WTO Agreement on Trade Related Aspects of Intellectural Property Rights (TRIPS) and the Convention on Biological Diversity.

Those issues, he continued, called for enhanced engagement between the WTO and a wide array of global, regional and national institutions in addressing coherence in international policy and law for sustainable development and trade.  Improving international support, including aid effectiveness and poverty-reduction strategies, was central to reducing poverty.  The IUCN welcomed the increased attention given to capacity-building for trade and development, and encouraged capacity-building initiatives to integrate environmental considerations into their work programmes, as highlighted in Agenda 21.

Introduction of Draft Resolutions

Mr. BENMELLOUK (Morocco), on behalf of the Group of 77 and China, introduced two draft resolutions on science and technology for development.  The first, (document A/C.2/58/L.6), takes note of the impact of new biotechnologies on sustainable development, particularly concerning food security, health and economic productivity.  The second, (document A/C.2/58/L.20) stresses the role of the United Nations Information and Communication Technologies (ICT) Task Force and the International Telecommunications Union in tracking global progress on the use of ICTs in achieving the Millennium targets. 

Turning to the issues of landlocked developing countries and the outcome of the International Ministerial Conference of Landlocked and Transit Developing Countries and Donor Countries and International Financial and Development Institutions on Transit Transport Cooperation, he introduced a draft (document A/C.2/58/L.16) on the Almaty Programme of Action:  addressing the special needs of landlocked developing countries with a new global framework for transit transport cooperation for landlocked and transit developing countries. 

He then introduced texts on the international financial system and development (document A/C.2/58/L.17); external debt crisis and development (document A/C.2/58/L.18); environment and sustainable development (document A/C.2/58/L.12); implementation of the United Nations Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, particularly in Africa (document A/C.2/58/L.7); the International Year of Deserts and Desertification, 2004 (document A/C.2/58/L.15); the Convention on Biological Diversity (document A/C.2/58/L.11); the International Strategy for Disaster Reduction (document A/C.2/58/L.10); and protection of global climate for present and future generations of mankind (document A/C.2/58/L.14). 

OLIVIER CHAVE (Switzerland) introduced a draft on sustainable development (document A/C.2/58/L.22), saying it highlighted several positive results of the successful International Year of Mountains, including partnerships launched.

Mr. BENMELLOUK (Morocco), on behalf of the Group of 77 and China, then introduced a draft on the implementation of Agenda 21, the Programme for the Further Implementation of Agenda 21 and outcomes of the World Summit on Sustainable Development (document A/C.2/58/L.9).

TORU SHIMIZU (Japan) introduced a draft on the United Nations Decade of Education for Sustainable Development (document A/C.2/58/L.13).

On the issue of training and research, ANTONIO BERNARDINI (Italy) introduced a draft on the United Nations System Staff College in Turin, Italy (document A/C.2/58/L.21).

BENJAMIN GILMAN (United States) then introduced a draft on cybersecurity and the protection of critical information infrastructures (document A/C.2/58/L.19), which stresses the need to facilitate information technology and capacity-building transfer to developing countries.

Statements

JEANETTE NDHLOVU (South Africa) said developing countries had agreed to the Doha agenda because of their commitment to an equitable trading system.  Reform of the regimes governing trade in agriculture and textiles, and special and differential treatment for developing countries remained core elements of the Doha round.  The multilateral trading system ensured a balanced and coherent approach to market reforms and guaranteed fairness in trading relations.  Any attempts to walk away from the multilateral trading system would fragment global markets to the detriment of all.

Africa’s dependence on trade in primary commodities had remained a key concern, she said.  Recent analysis by UNCTAD had shown that 17 of the continent’s 20 most important export items were primary commodities and natural resource-based semi-manufactured goods; that Africa had lost terms of trade for most of its important commodities, such as sugar, cocoa, coffee and cotton, mainly due to price volatility or secular price declines induced by subsidies and support measures in the North; and that the major beneficiaries from the present world trading system were multinational corporations wielding enormous market power in food industries.

According to the International Coffee Organization, earnings by coffee-producing countries in the South -- about $10 million to $12 million in the 1990s, had fallen to a mere $5.5 million today, she said.  The beneficiaries had been neither coffee farmers in developing countries nor consumers in developed countries, but big multinationals involved in the value-adding process.  As for cotton, the Washington-based International Cotton Advisory Committee argued that losses of income to all cotton producers amounted to some $15 billion from 2001-2003, due to subsidies and other government support measures.  The UNCTAD had shown that subsidies by the United States and the European Union alone had caused losses of up to $300 million in revenue to Africa.  That was more than the total debt relief of $230 million approved by the Bretton Woods institutions favouring nine HIPC cotton-exporting countries in Africa.

SACHIE HERNANDEZ (Cuba) said trade liberalization in the last several years had widened the imbalances between rich and poor.  Global exports of basic products -– the mainstay of many developing countries’ economies -– represented just 22.1 per cent of global commerce in 2000.  From 1995 to 2002, the prices of non-petroleum products had fallen on average 1.3 per cent annually, while exports from developing countries had fallen considerably as compared with the 1985-1994 period.  Western Europe, Canada and the United States accounted for 62.8 per cent of the global manufacturing trade, while Latin America’s share was 4.7 per cent and Africa’s a dismal 0.8 per cent.

She said the issues of multilateralism and development must be sent back to the negotiating table, stressing that future talks must give priority to preferential treatment for developing countries, finding a lasting solution to their external debt problem, increased technology transfer and ODA.  Better market access was needed for their agricultural exports.  The recommendations of the Panel of Eminent Persons on commodities regarding stabilizing international prices for basic products must be implemented.

TOUFIQ ALI (Bangladesh) said developing countries had recognized that trade could act as an engine of growth, but not suspected the limitations imposed by declining terms of trade, quotas, and non-tariff barriers.  They had found out the constraints only when they had begun to export.  As a result, there had been a marked, steady decline in the market share of least developed countries in world trade over the past four decades.

Developing countries gained less from trade than industrial nations, she said.  According to the World Bank, tariff peaks and tariff escalation, combined with other non-tariff barriers imposed by high-income countries, cost developing countries much more in lost export opportunities than the $50 billion they received in foreign aid each year.  Instead of facilitating exports, multilateral trade rules had moved into domestic policy issues, severely undermining policy autonomy.  While developing countries were dismantling barriers, developed countries were maintaining high subsidies, erecting new protectionist devices and closing the door in sectors where developing countries had an advantage.

WARREN SNOWDON (Australia), speaking on behalf of the Cairns Group, said the grouping was disappointed with the Cancún failure to advance the Doha agenda, particularly aspects concerning urgently needed agricultural trade reform. Seventy per cent of the world’s poor lived in rural areas and depended on agriculture for their livelihood.  They struggled to survive on less than $2 a day, while rich nations spent $1 billion daily on farm support.  The OECD nations spent $318 billion on farm subsidies in 2002, versus just $57 billion on development assistance.

He called on WTO members, particularly major developed nations, to immediately bring the Doha agenda back to the negotiating table and urged them to set a date for eliminating all forms of export subsidies, reduce trade-distorting domestic support, improve market access for all products, and create effective mechanisms for special treatment to address the needs of developing countries, particularly as they concerned food security, rural development and poverty alleviation.

IRENE FREUDENSCHUSS REICHL, United Nations Industrial Development Organization (UNIDO), noted that developing countries needed to vastly improve their supply-side capacities for an adequate volume and range of goods to sell on the global markets.  Responding to those needs, UNIDO’s programmes were focusing on capacity-building on the policy, institutional and industry levels, and complying with market requirements and international standards. 

She said UNIDO’s approach included a series of cross-sectoral activities, which may include developing competitive manufacturing capabilities; strengthening the capacity of technical support institutions and associations; promoting enterprise upgrading through innovation and technology acquisition; creating an enabling environment through awareness seminars, training and introduction of working methodologies and practical training in pilot enterprises; and upgrading marketing capabilities.  Recognizing that regional interventions were a suitable and cost-effective model to help smaller countries and least developed countries, UNIDO had also promoted the establishment of regional calibration centres and accreditation authorities. 

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