Fifty-ninth General Assembly

Second Committee

40^th Meeting (PM)

SECOND COMMITTEE TEXT EMPHASIZES NEED FOR COMMODITY-DEPENDENT DEVELOPING

COUNTRIES TO ENCOURAGE DIVERSIFICATION, LIBERALIZE TRADE

 

Without Vote, Delegates Approve Six Other Drafts, Oral Decision

(Issued on 17 December 2004.)

The General Assembly would emphasize the need to encourage diversification, liberalization of trade and exports, and enhanced competitiveness by developing countries that were heavily dependent on primary commodities, according to a draft resolution approved by the Second Committee (Economic and Financial) this afternoon.

By other terms of that draft, one of seven texts approved without a vote, the Assembly would encourage developing countries to formulate specific commodity policies to contribute to the facilitation of trade expansion, reduction of vulnerability, and improvement of livelihoods and food security by creating an enabling environment encouraging the participation of rural producers and small farmers; continuing the diversification of the commodity sector and enhancing its competitiveness in heavily commodity-dependent developing countries; as well as increasing technology development and improving information systems, institutions and human resources.

The draft resolution on commodities (document A/C.2/59/L.26/Rev.1) would have the Assembly emphasize the importance of official development assistance (ODA) for agriculture and rural development, and invite developing countries to prioritize agriculture and rural development in their national development strategies and programmes.  It would call on developed countries to work towards providing duty-free and quota-free market access for least-developed-country products, and encourage developing countries to contribute to improved market access for least developed countries.

Expressing regret that schemes to mitigate earnings shortfalls had not reached the originally envisaged goals, the Assembly would urge governments and international financial organizations to continue assessing the effectiveness of systems for compensatory financing of shortfalls in export earning, and stress the importance of empowering developing-country commodity producers to insure themselves against risk, including natural disasters.

Further by the text, the Assembly would call on the United Nations Conference on Trade and Development (UNCTAD) to work in cooperation with interested stakeholders for the effective operation of the International Task Force on Commodities launched at the eleventh session of UNCTAD.  It would underline the need to strengthen the Common Fund for Commodities and encourage it to continue strengthening activities covered by its Second Account in developing countries with its supply chain concept of improving access to markets and reliability of supply, enhancing diversification and addition of value, improving the competitiveness of commodities, strengthening the market chain, improving market structures, broadening the export base and ensuring the effective participation of all stakeholders.

Prior to the Committee’s consensus action on the draft, it approved the retention of its operative paragraph 12 by a recorded vote of 149 in favour, to 1 against (United States) with two abstentions (Canada, Israel).  (See annex I for voting details.)

The representative of the United States, who had requested the vote, said that the paragraph included language that attempted to distort that of the pre-Doha Round of trade negotiations, which did not call for duty-free and quota-free access for all least-developed-country products.

Speaking on behalf of the least developed countries (LDCs), Benin’s delegate said the United States had participated in the Third United Nations Conference on LDCs in Brussels, where language reflected in operative paragraph 12 of the current text had initially been used.  The United States delegation had repeatedly tried to act against paragraphs that had been agreed upon at the Brussels Conference, he said, questioning whether it wished to go back on commitments it had made there.

Prior to the vote, Qatar’s representative, speaking on behalf of the “Group of 77” developing countries and China, stressed that consensus on the draft would support existing agreements on commodities, and that urgent measures were needed to ensure the contribution of commodities to poverty eradication and attainment of the Millennium Development Goals.  The language of the text reflected common efforts to unlock poverty for millions of people across the globe, and the international community had acknowledged fully in the Brussels Programme of Action that responsibility for implementing policies aimed at fostering growth and reducing poverty was a shared one.

Speaking on behalf of the European Union, the representative of the Netherlands said he would vote in favour of the draft.  The Union remained committed to addressing the concerns of commodity-dependent developing countries and to the need for preferential access for LDCs.  All developed countries that had not yet done so should provide quota- and duty-free access to LDC products.

The representative of the United Republic of Tanzania stressed that references to preferential access for LDCs reflected language that had already been internationally agreed.

The Sudan’s representative agreed with the delegate of Benin, saying that renegotiating matters on which agreement had already been reached in other forums could lead other States to rethink their positions and back away from agreed language.  That would set a dangerous precedent.

Speaking in explanation of position after the vote, the representative of Japan said that operative paragraph 12 implied nothing more than the simple reaffirmation of commitments made at the Fourth Ministerial Conference of the World Trade Organization (WTO) and the Brussels Conference.

Another draft, on the international financial system and development (document A/C.2/59/L.70), would have the Assembly underline the importance of national efforts to increase resilience to financial risk, and stress the importance of better assessment of a country’s debt burden, as well as its ability to service that debt in both crisis prevention and resolution.  It would also stress the importance of strong domestic institutions in promoting business activities and financial stability to achieve growth and development through sound macroeconomic policies as well as policies aimed at strengthening the regulatory systems of the corporate, financial and banking sectors.  It would stress, by further terms, that international cooperation initiatives in those areas should encourage flows of capital to developing countries.

Also by that text, which was introduced by Committee Vice-Chair Majdi Ramadan (Lebanon) and approved as orally amended, the Assembly would emphasize that it was essential to ensure the importance of effective and equitable participation by developing countries in formulating financial standards and codes, and underscore the need to ensure their implementation as a contribution to reducing vulnerability to financial crisis and contagion.  It would also call for continued efforts by multilateral financial institutions to provide policy advice, technical assistance and financial support to member countries, to work on the basis of nationally owned reform and development strategies, to pay due regard to the special needs and implementing capacities of developing countries and countries with economies in transition, and to minimize the negative impacts of adjustment programmes on the vulnerable segments of society.

By other terms, the Assembly would stress the need to continuously improve standards of corporate and public-sector governance, including accounting, auditing and measures to ensure transparency.  It would also strongly encourage leading bond-issuing countries and the private sector to make substantial progress on the preparation of an effective code of conduct, bearing in mind the need not to preclude emergency financing in times of crisis, to promote fair burden-sharing and to minimize moral hazard.

According to a draft on follow-up to and implementation of the outcome of the International Conference on Financing for Development (document A/C.2/59/L.69), the Assembly would stress the importance of full involvement by all relevant stakeholders in the implementation of the Monterrey Consensus arising from that Conference, and stress the importance of their full participation in the Monterrey follow-up process.

Further by that draft, which was introduced by Committee Vice-Chair Antonio Bernardini (Italy) and approved as orally amended, the Assembly would underline the importance of implementing the commitment to sound policies, good governance and the rule of law; the commitment to create an enabling environment for mobilizing domestic resources and the importance of sound economic policies, solid democratic institutions responsive to the needs of people and improved infrastructure as a basis for sustained economic growth, poverty eradication and employment creation; and the commitment to enhance the coherence and consistency of international monetary, financial and trading systems.

Also by that text, the Assembly would stress that debt relief could play a key role in liberating resources for activities consistent with poverty eradication, achieving sustained economic growth and sustainable development, as well as achieving internationally agreed development goals.  It would, by other terms, stress the importance of promoting responsible lending and borrowing and the need to help Heavily Indebted Poor Countries to manage their borrowings and avoid a build-up of unsustainable debt, including through the use of grants.  It would also stress the importance of advancing efforts to reform the international financial architecture, and encourage the International Monetary Fund (IMF) and World Bank to continue examining the issues of the voice and effective participation of developing countries and countries with economies in transition in their decision-making processes.

Recalling the commitments made at the International Conference on Financing for Development to increase the levels and effectiveness of the ODA, the Assembly would urge developed countries that had not yet done so to make concrete efforts towards the target of 0.7 per cent of gross national product as official assistance to developing countries, and 0.15 to 0.20 per cent of gross to LDCs.  Developing countries would be encouraged to continue to build on progress achieved in ensuring that the ODA was used effectively to help achieve development goals and targets.

Stating her position on that draft, the representative of the United States said that, in joining the consensus, her delegation welcomed the meeting of world leaders referred to in the text as an event that had helped to renew and strengthen the collective commitment to combat poverty and hunger.  However, the United States continued to oppose certain ideas for financing advanced at that meeting, including the proposal for global taxes.  The citizens of democratic countries gave their elected governments the authority to tax them.  As such, global taxes represented an affront to democracy.

Moreover, she continued, each country retained the right to decide how to raise funds for the ODA, which, while an essential component of total resources for development, remained relatively small among many sources –- public, private, domestic and external.  A serious and comprehensive discussion about financing for development failed to advance the idea that the main obstacle to development was the lack of new schemes to raise funds for ODA.

She reaffirmed that the United States did not accept international aid targets based on percentages of donor gross national product.  Aid should be increased to those developing countries that made demonstrable commitments to just governance, investment in the people and promotion of enterprise and entrepreneurship.  At Monterrey, the United States had pledged to increase the ODA by 50 per cent over the 2000 levels by 2006.  That pledge had been met three years early, in 2003.  The 0.7 per cent target bore no relationship either to demonstrated need, or to the ability of recipients to use aid effectively.

By a draft on implementation of the first United Nations Decade for the Eradication of Poverty (1997-2006), contained in (document A/C.2/59/L.72), the Assembly would stress the importance of enhanced and predictable aid flows to ensure the sustainability of the development and poverty eradication efforts of developing countries.

The draft, introduced by Mr. Ramadan and approved as orally amended, would have the Assembly urge countries to direct resources freed through debt relief, particularly through debt cancellation and reduction, towards poverty eradication activities, sustainable economic growth, sustainable development and internationally agreed development goals.  It would also call upon developed countries to promote capacity-building and facilitate access to and transfer of technologies and corresponding knowledge on favourable terms, including concessional and preferential terms.  Member States would also be invited to consider facilitating the expansion of microfinance and microcredit institutions.

By other terms of the draft, the Assembly would emphasize the critical role of both formal and non-formal education, especially for girls, in empowering those living in poverty.  Urging governments and the international community to give urgent priority to combating HIV/AIDS, malaria, tuberculosis and other infectious, contagious diseases, the Assembly would emphasize the link between poverty eradication and improving access to safe drinking water, and stress the objective to halve by 2015 the proportion of people who were unable to reach or afford safe drinking water and the proportion of those without access to basic sanitation.

Calling upon the Governments of LDCs and their development partners to implement commitments contained in the Brussels Declaration and the Programme of Action for the Least Developed Countries for the Decade 2001-2010, the Assembly would stress the importance of implementing commitments taken specifically in regard of the special needs of landlocked developing countries.  It would recognize the special problems and needs of the landlocked developing countries within a new global framework for transit-transport cooperation for landlocked and transit developing countries and call, in that regard, for the full and effective implementation of the Almaty Programme of Action.

The Assembly would, by further terms of the draft, stress the vulnerabilities of the small island developing States and support the holding of the International Meeting to Review the Implementation of the Programme of Action for the Sustainable Development of Small Island Developing States in Mauritius from 10 to 14 January 2005.

Further, the Assembly would call on MemberStates and the international community, and invite the United Nations system, to continue to support the New Partnership for Africa’s Development (NEPAD), aimed at eradicating poverty and promoting sustainable development on the basis of African ownership and leadership and enhanced partnership with the international community.

Commenting after the approval of that text, the representative of the United States expressed disappointment that it continued to lack balance, contributed nothing new to the discussion on poverty, and made scant reference to domestic policy requirements for the eradication of poverty.  The Secretary-General’s recent report had recognized and underscored the potential of entrepreneurship to counteract poverty and a serious and balanced text would have welcomed that finding and encouraged Member States and the United Nations system to act upon them.  In fact, many developing and transition countries were acting upon those findings.  The draft should also have lauded the fact that 75 per cent of countries were on the right track to meet relevant goals.

A draft on the role of the United Nations in promoting development in the context of globalization and interdependence (document A/C.2/59/L.68) would have the Assembly stress that improved coherence between national and international efforts, and between the international monetary, financial and trading systems was fundamental for sound global economic governance.  It would further emphasize that development should be at the centre of the international economic agenda and that coherence between national development strategies, on the one hand, and international obligations and commitments, on the other, contributed to the creation of an enabling economic environment for development.

Further by that draft, introduced by Mr. Bernardini and approved as orally amended, the Assembly would stress that development strategies must be formulated with a view to minimizing the negative social impact of globalization and maximizing its positive impact, while ensuring that all population groups benefited from it.  It would underline that it was for each government to evaluate the trade-off between the benefits of accepting international rules and commitments and the constraints posed by the loss of policy space, and that it was particularly important for developing countries that all countries take into account the need for appropriate balance between national policy space and international disciplines and commitments.

The Assembly would, by other terms, stress the importance of migration as a phenomenon accompanying increased globalization, including its impact on economies, and underline further the need for greater coordination and cooperation among countries as well as relevant regional and international organizations.

Also by the text, the Assembly would emphasize the importance of recognizing and addressing the specific concerns of countries with economies in transition to help them benefit from globalization, with a view to their full integration into the world economy.

Also, the Assembly would stress the need to build an inclusive information society, and that national efforts needed support by effective international and regional cooperation among governments, the private sector, civil society and other stakeholders, including international financial institutions, to assist in bridging the “digital divide”, promoting access to information and communication technologies, creating digital opportunities and harnessing the potential of information and communication technologies for development.

By other terms, the Assembly would urge all governments to ensure women’s equal rights with men as well as their full and equal access to education, training, employment, technology and economic and financial resources, including credit, particularly for rural women and those in the informal sector, and to facilitate the transition of women from the informal to the formal sector.

Referring to that draft, the representative of Venezuela remarked that to date, globalization had helped improve the situation for developed countries, but had led to greater hunger and poverty in others, failing to promote a model of growth.

The representative of the United States said the draft continued to cast globalization in a negative light without acknowledging that it was a neutral force, representing an enormous opportunity for countries to join the process.  Countries that promoted good governance, solid democratic institutions, respect for the rule of law, strong regulatory systems and investment in human capital remained best placed to take advantage of the many opportunities offered by globalization.

A text on the triennial comprehensive policy review of operational activities for development of the United Nations system (document A/C.2/59/L.63) would have the Assembly stress that the purpose of reform was to make the development system more efficient and effective in support of developing countries’ achievement of internationally agreed development goals, and request the United Nations system to continue efforts to respond to national development plans, policies and priorities, which constituted the only viable frame of reference for programming operational activities at the country level.

Also by that text, introduced by Committee Rapporteur Azanaw Tadesse Abreha (Ethiopia) and approved as orally amended, the Assembly would call upon donor countries to increase substantially their contributions to the core/regular budgets of the United Nations development system, and invite the governing bodies of development organizations to systematically address the funding of their operational activities.  It would also urge all organizations of the development system to intensify inter-agency information sharing at the system-wide level, and strengthen the capacity of developing countries better to utilize the various aid modalities, including system-wide approaches and budget support.  The Assembly would also stress that developing countries should have access to new and emerging technologies, which required technology transfer, technical cooperation and the building of scientific and technological capacity.

The text would also have the Assembly urge members of the Executive Group of the United Nations Development Group (UNDG) to develop a procedure for the common assessment of resident coordinators’ performance, and request the Secretary-General to develop, by the end of 2005, a comprehensive accountability framework for resident coordinators.  Moreover, country-level evaluations of the United Nations Development Assistance Framework (UNDAF) at the end of the programming cycle would be strongly encouraged, and the need to assist governments to development national evaluation capacities would be stressed.

By other terms, the Assembly would call upon the organizations of the development system, the regional commissions and other regional and subregional entities to intensify their cooperation and adopt collaborative approaches to support country-level development initiatives.  It would also urge organizations and bodies of the United Nations system to support South-South cooperation, and celebrate the related United Nations Day every year.

Qatar’s representative said on behalf of the Group of 77 that the text contained elements of great importance for developing countries as a whole, notably placing adequate emphasis on the need to increase donor resources.  All those Member States able to do so must support the country-level activities of the United Nations system.  The text also stressed the need for inclusiveness, among other principles, to ensure that country-level implementation of international development goals became a reality.  As preparation for the five-year review of the Millennium Declaration drew closer, the draft placed upon the table certain actions that looked even further into the future.  It stressed the importance of South-South cooperation and of regional cooperation, technology transfer and the transition from relief to development.

The representative of the United States said the text represented a step forward as it provided guidance to make operational activities of the United Nations development system more coherent and coordinated.  The next critical step would be implementation, and it was to be hoped that implementation of the text would make the system’s operational activities for development more effective in reducing poverty.  However, the United States understood the right to development as the right of the individual to develop his or her intellectual and other capabilities to the fullest by exercising the full range of economic, social and cultural rights.

She reiterated that the United States did not accept international ODA targets, but felt that assistance should increase when countries made progress in good governance.  Regarding technology for development and the need for technology transfer, many technologies were proprietary in nature and had only been developed on the basis of the capacity of researchers and sponsors to realize the fruits of their labour.  Technology transfer could not be mandated, but required mutual agreement, and it was regrettable that language to that end had not been accepted.

By a draft resolution on the Third United Nations Conference on the Least Developed Countries (document A/C.2/59/L.71), the Assembly would urge LDCs and their bilateral and multilateral development partners to increase efforts to meet the targets of the Programme of Action in a timely manner.  It would request the Secretary-General to engage UNDG’s team leaders in the coordinated implementation of activities of the Brussels Programme of Action.

Further by that text, introduced by Mr. Abreha and approved as orally amended, the Assembly would invite the 2005 high-level event to address the special needs of LDCs, and decide to hold the comprehensive review of the Brussels Programme of Action in 2006 within the General Assembly during its sixty-first session.  It would also decide to consider modalities for conducting that comprehensive review during its sixtieth session.

Also by that draft, the Secretary-General would be requested to establish a specific trust fund –- to be funded by voluntary contributions -- for the travel and subsistence of two representatives from each LDC to attend the annual review of the Programme of Action, while Member States, intergovernmental and non-governmental organizations and the private sector would be called upon to make such voluntary contributions.  Finally, the Assembly would invite UNCTAD to conduct an analysis of the role that enterprise could play in alleviating poverty in LDCs and to recommend measures that their Governments could take to promote private-sector development.

Japan’s representative welcomed the decision to convene the comprehensive review of the Brussels Programme of Action in 2006 and that Member States review existing budgetary lines during the sixtieth General Assembly session.  The Secretariat should then present a budget containing truly essential elements for the review, to be covered within existing resources.

The representative of the United States, associating her delegation with the comments by Japan’s delegate, said she looked forward to discussing modalities for the 2006 review and requested the Secretariat to provide guidance on the review process, including how to make maximum use of cost efficiencies.  The review’s cost should be covered within existing resources.

Also today, the Committee approved, without a vote, an oral draft decision to take note of the report of the Administrator of the United Nations Development Fund for Women (document A/59/135).

Speakers during today’s meeting also included the representatives of Chile, Australia, Egypt, and France.

The Second Committee will meet again at 3 p.m. tomorrow, Friday 17 December, to conclude its session.

ANNEX

Vote on Operative Paragraph 12 (Commodities)

The retention of operative paragraph 12 of the draft resolution on commodities (document A/C.2/59/L.26/REV.1) was approved by a recorded vote of 150 in favour to 1 against, with 2 abstentions, as follows:

In favour:  Afghanistan, Albania, Algeria, Andorra, Angola, Argentina, Armenia, Australia, Austria, Bahamas, Bahrain, Bangladesh, Barbados, Belarus, Belgium, Belize, Benin, Bolivia, Bosnia and Herzegovina, Botswana, Brazil, Brunei Darussalam, Bulgaria, Burkina Faso, Burundi, Cambodia, Cameroon, Cape Verde, Chad, Chile, China, Colombia, Congo, Costa Rica, Côte d’Ivoire, Croatia, Cuba, Cyprus, Czech Republic, Democratic People’s Republic of Korea, Denmark, Djibouti, Dominica, Dominican Republic, Ecuador, Egypt, El Salvador, Eritrea, Estonia, Ethiopia, Federated States of Micronesia, Finland, France, Georgia, Germany, Ghana, Greece, Grenada, Guatemala, Guinea, Guyana, Haiti, Hungary, Iceland, India, Indonesia, Iran, Ireland, Italy, Jamaica, Japan, Jordan, Kenya, Kyrgyzstan, Lao People’s Democratic Republic, Latvia, Lebanon, Lesotho, Libya, Liechtenstein, Lithuania, Luxembourg, Madagascar, Malaysia, Maldives, Mali, Malta, Mexico, Monaco, Mongolia, Morocco, Mozambique, Myanmar, Namibia, Nepal, Netherlands, New Zealand, Nicaragua, Niger, Nigeria, Norway, Oman, Pakistan, Panama, Paraguay, Peru, Philippines, Poland, Portugal, Qatar, Republic of Korea, Republic of Moldova, Romania, Russian Federation, Rwanda, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Samoa, San Marino, Senegal, Serbia and Montenegro, Singapore, Slovakia, Slovenia, Somalia, South Africa, Spain, Sri Lanka, Sudan, Suriname, Sweden, Switzerland, Syria, Thailand, Togo, Trinidad and Tobago, Tunisia, Turkey, Turkmenistan, Uganda, Ukraine, United Kingdom, United Republic of Tanzania, Uruguay, Venezuela, Viet Nam, Yemen, Zambia, Zimbabwe.

Against:  United States.

Abstain:  Canada, Israel.

Absent:  Antigua and Barbuda, Azerbaijan, Bhutan, Central African Republic, Comoros, Democratic Republic of the Congo, Equatorial Guinea, Fiji, Gabon, Gambia, Guinea-Bissau, Honduras, Iraq, Kazakhstan, Kiribati, Kuwait, Liberia, Malawi, Marshall Islands, Mauritania, Mauritius, Nauru, Palau, Papua New Guinea, Sao Tome and Principe, Saudi Arabia, Seychelles, Sierra Leone, Solomon Islands, Swaziland, Tajikistan, The former Yugoslav Republic of Macedonia, Timor-Leste, Tonga, Tuvalu, United Arab Emirates, Uzbekistan, Vanuatu.

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