Speakers at a special session of the Thirteenth Ministerial Meeting of the United Nations Conference on Trade and Development (UNCTAD XIII) today emphasized the importance of taking an integrated approach to the world’s financial institutions, in which trade was addressed alongside investment, development and other key issues.
Nassir Abdulaziz al-Nasser, President of the United Nations General Assembly, said UNCTAD provided a forum for all nations to participate in addressing the multilateral development agenda. Several questions should guide the Conference: What did renewing Member States’ commitments to trade and development require of them today? How could the international community renew its commitment to multilateral negotiations in light of the stalemate over the Doha Round? What path should UNCTAD follow in the future?
Reviewing UNCTAD’s history, he said the Conference was uniquely linked with the General Assembly, recalling that it had been established as a complement to two meetings: one at Bretton Woods in 1944 — which had seen the creation of the World Bank and the International Monetary Fund (IMF) – and the 1946 United Nations Conference on Trade and Employment. UNCTAD, for its part, had been created in response to new developments in the world, specifically the end of colonialism, he said, noting that it was an expression of the new geopolitical map that had emerged after the Second World War, and took account of countries newly emerging into the global trade system.
Briefly outlining UNCTAD’s past agendas, he said the Conference was most useful when helping Member States cope with economic change, and most successful when working through consensus. While controversies around UNCTAD should be seen as a sign of life rather than a mark of dysfunction, Member States should work towards building that consensus, he emphasized. Indeed, balance and pragmatism must be the two basic slogans of the day and stakeholders must provide the Conference with the appropriate directives for moving forward.
Supachai Panitchpakdi, Secretary-General of UNCTAD, also set forth several questions: Why was analysis of international monetary structures necessary? Why was integrated treatment needed? Why deal with the facts of productive capacity? And why should trade be development-centred? Recalling that he had presided over UNCTAD X in Thailand in 2000, he said there had seemed to be “no light at the end of the tunnel” and no interest whatsoever in multilateral negotiations. Asia had been suffering from a misdiagnosis by the IMF and had taken nearly 10 years to recover from income lost, not because of the sickness, but because of the medicine. After that period, the Fund and other international financial institutions had worked hard to fight the crony capitalism and mismanagement that had led to the crisis, he said. Rigorous, independent analysis, as well as strong supervision, had become critical and the last few years had seen reasonable lending and successful payment by countries.
Turning to the second question, he said integrated treatment had many meanings. For example, one could not hope to perform rigorous analysis while considering trade on its own — responsible investment must also be considered. As the world continued to deal with unfettered, uncontrolled capital flows that had distorted exchange rates and trade, those distortions had affected the whole world, he said, adding that applying policies such as quantitative easing could affect other nations.
Regarding productive capacity — an important consideration when dealing with international financial matters — he said that, when countries liberalized trade, they needed to take care of those that would be negatively affected by opening up their own markets. Moreover, it was the quality, not the quantity, of a country’s investments that was most important. Productivity, particularly in the area of land resources, must be shared with the people, he stressed. Addressing his last question, he said UNCTAD XIII would be about development, jobs and sustainability. Financial investment did not necessarily lead to more jobs, he cautioned, adding that it was unjust for the top 1 per cent of a society to control most of its wealth.
Adelwahad Radi, President of the Inter-Parliamentary Union (IPU) said the international community stood to gain from a strengthened UNCTAD. The Conference had always been receptive to parliamentarians, and the IPU supported it as a forum that led development-focused globalization. The “complex edifice” of development would be fragile if it lacked a solid foundation in democracy. Recalling the recent statutory IPU meeting in Kampala, Uganda, he said members had discussed the Arab Spring uprisings, which constituted lessons on democracy, freedom and good governance. The latter was based on the rule of law, on efficient and accountable intuitions, and on rules that promoted development. It protected human rights and ensured that people were free to participate in decisions affecting their lives.
He went on to stress that people’s concerns should always be at the centre of policy, saying that was one of the IPU’s main messages to UNCTAD today. Many countries suffered when their parliaments failed to “hold Governments to task” or to consider people’s concerns. Many parliaments were not consulted by the executive or by international financial institutions when it came to development strategies, and in turn development was not frequently a subject of parliamentary debate, he noted, stressing, however, that many parliamentarians around the world were working to change that situation.
It was important that UNCTAD take a more proactive stance in supporting the role of parliaments in financial and development policies, he continued. For example, the Conference was finalizing a draft on budgets and development, and that document must reflect the role of parliamentarians. While it was encouraging to see improvements in global financial institutions — including increased quotas for the representation of developing countries, greater transparency, and an increase in the number of high-ranking women — the IPU remained concerned about the pace and depth of those improvements and wished to be more involved in such matters.
Valentine Sedanyoye Rugwabiza, Deputy Director-General of the World Trade Organization, said that, in the wake of the worst financial crisis since the 1930s, global trade was projected to grow at only 3.7 per cent in 2012, a decrease from 2011. The global balance of power was changing and the “family of nations” was struggling to develop joint responses to challenges affecting them all. However, it was not the time for excessive pessimism as some recovery was being seen, she said. While much more remained to be done, developing countries would likely account for more than half of global trade in 2012, and improvements had been seen in basic health and nutrition in many places around the world. Though trade was a substantial part of growth, it did not work in isolation, she said. “Trade cannot deliver alone, but there is no possible growth without trade” as a central part of any development strategy.