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Martin Khor

Battle to save UNCTAD’s mandate

by Martin Khor

19 April 2012

On the eve of its thirteenth session, the Ministerial conference known as UNCTAD XIII, a major battle is under way at UNCTAD to preserve its mandate to work on key areas, especially macro-economic and finance issues.

A serious impasse emerged last week in the preparatory committee of UNCTAD XIII, which is tasked with preparing the draft outcome document that Ministers are scheduled to adopt at the end of UNCTAD XIII.

While the previous two or three conferences were rather tame affairs, it looks like UNCTAD XIII (whose general theme is development-centred globalization) will be fiery, with the organisation’s future scope of work and influence at stake.

UNCTAD was set up in 1964 to support developing countries to strengthen their weak position in international economic structures, and to design national development strategies.

It became a kind of secretariat on behalf of developing countries, providing a small pro-development balance to the huge organisations dominated by the developed countries, such as the OECD, the IMF and World Bank.

In the past two decades, however, the developed countries have tried to curb the pro-South orientation of the UNCTAD secretariat and its many reports. The inter-governmental discussions became less significant, while UNCTAD’s pro-development mission was increasingly challenged by the developed countries.

This unhealthy trend seemed to have subsided in the past decade, but in the past two months, the meetings in Geneva to prepare for UNCTAD XIII, some developed countries have reportedly attempted to dilute the areas of future work of UNCTAD, to the frustration of the G77 and China.

Last week’s meetings at the preparatory committee ended in a near crisis, with the countries unable to agree on how to proceed with some key issues and with a draft of the outcome document.

At the committee’s meeting on 13 April, a major dispute arose over whether the Doha outcome should "reaffirm" the mandate given to UNCTAD at the previous session (UNCTAD XII held in Accra in 2008, which adopted the Accra Accord).

The G77 and China proposed reaffirming the Accra Accord, and normally this would have been accepted as a matter of routine.

However, a group of developed countries opposed the term "reaffirm". Instead, they wanted language to "build on" the Accra accord.

This caused frustration to the members of the G77 and China, which saw the move as an attempt to take away some of the issues that UNCTAD is working on. Refusal to reaffirm the Accra accord seemed to be another measure to chip away at the influence of UNCTAD and its support for development.

Speaking on behalf of the G77 and China, Ambassador Pisanu Chanvitan of Thailand regretted that the accommodative stance of the group had been viewed as weakness or capitulation. (See separate story on G77 and China statement.)

The group has hoped that the global economic and financial crisis marks once and for all the end of the bad old days, and perhaps the dawn of an international regime of global economic governance based on the highest principles and ideals of the United Nations, including sovereignty, equality, and mutual respect.

"Instead, we see behaviour that seems to indicate a desire for the dawn of a new neocolonialism. We cannot, we will not, accept this."

The G77 and China believed that UNCTAD XIII can contribute to a new beginning, and that the theme of development-centred globalization could articulate a vision of development based on equality and equal respect for all.

"Unfortunately, the developing countries feel increasingly marginalised by our partners especially when they seem to deny us our own priorities."

The Thai Ambassador stressed that the Accra Accord must be reaffirmed. And while the G77 and China had already made "incredible compromises", it now proposed that at the minimum the Doha conference could adopt the compromise text that the President of the Trade and Development Board (Ambassador Mothae Maruping of Lesotho) had issued in the first week of April.

This was a 22-page President’s text that had drawn from a thick compilation document containing proposed language from all members.

The G77 and China said its development partners (referring to developed countries) may mistakenly think that the question is whether there will be an outcome document, and added that: "Let us assure our partners that there will be an outcome document", but the question is whether there will be a positive spirit that leads to a consensus document.

In response, a group of developed countries regretted that they were being painted as being on the "bad side" and asked that their proposals be not "engineered always as a weapon in a North-South conflict."

The impasse, so close to the start of UNCTAD XIII, has given rise to discussions on whether the Doha conference will result in a consensus-based outcome, or whether the developing countries would resort to proposing a vote on a document it puts forward. A vote on a G77 and China document is considered a last resort, since the normal procedure is to adopt a consensus document.

It would appear that whether the Doha outcome will reaffirm the Accra Accord has become the most important political issue at this point of the negotiations. It is understood that there is widespread agreement that the outcome document will be based on negotiations on the President’s text.

The G77 and China are however adamant that this text, which they consider already too much watered down from the group’s own proposed text, should not be diluted further.

The preparatory committee will resume its negotiations on 16 April afternoon.

The battle in the UNCTAD XIII preparatory process is being monitored with a sense of serious concern.

An influential group of 50 former senior UNCTAD staff issued a joint statement criticizing efforts by major developed countries to reduce UNCTAD’s mandate and deny it the right to continue to analyse global macroeconomic issues from a development perspective.

The signatories included former UNCTAD Secretary-General Rubens Ricupero, two former deputy Secretaries-General, Carlos Fortin and Jan Pronk, and several Directors.

Martin Khor is the Executive Director of the South Centre.

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