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GLOBALISATION MUST NOT BE AT THE EXPENSE OF PEOPLE- JOINT INTERNATIONAL NGO STATEMENT FOR UNCTAD-IX

The following Declaration has been prepared by Non-Governmental Organisations attending the UNCTAD-IX Conference. The NGOs met for several days in preparatory meetings in Midrand, South Africa, on 24-28 April 1996.

A. INTRODUCTION

1. WE representatives of social movements and NGOs participating in our own preparatory meetings and in UNCTAD-IX have a common vision of global development that is equitable within and among countries, which satisfies the economic, social and cultural needs of all human beings, and that is in harmony with the environment.

2. We believe that the world has enough resources to meet these needs. Yet the problems of poverty, inequalities, unemployment and environmental degradation are even worse than before. Due to continuing conflicts after the Cold War, and the ever-increasing environmental crisis, the future of Earth and humankind is still at stake as never before.

3. Against this background, we are pleased that the governments have chosen to examine the globalisation issue as the focus of UNCTAD-IX.

B. GLOBALISATION, LIBERALISATION AND MARGINALISATION

4. As members of civil society, we are very concerned about the effects of globalisation, accompanied by liberalisation and a shift of policy focus internationally and in most countries from broad social concerns to narrow economic competitiveness.

5. Globalisation and liberalisation have facilitated the increasing powers and rights of big corporations and the private sector, and the decreasing role of the states nationally and of the United Nations internationally. The public in every country is left less and less protected from the vagaries and forces of the market. Poverty and unemployment have increased in many countries. The state in many countries is abandoning (or forced to abandon) its function of offsetting the ill effects of unfettered market forces.

6. One negative aspect of globalisation is the way key national polcies are now being made by global institutions controlled by the North and which act in the interests mainly of the elite and of big corporations. This has seriously eroded the national sovereignty of many Southern countries. For instance, structural adjustment policies (SAPs) designed by the World Bank and IMF, and applied to scores of developing countries, have shifted the burden of economic adjustment to the poor and increased social inequities and political instability. In effect the poor have been made to pay for servicing external debt, and this has been paid for by the lives, health and impoverishment of many millions of people (especially children). Such a phenomenon is tragic and shameful and governments must pledge that it should not continue or recur. Liberalisation has also been at the expense of the environment, as it has increased the worldwide transfer of unsustainable consumption and production patterns.

7. The Uruguay Round has further intensified the liberalisation process. On the basis of our own experiences in many parts of the world, we do not share the "optimism" that freer trade and investment will solve development problems. On the contrary, for poorer countries, liberalisation can and has meant the opening up to foreign imports and firms, which can and has already run the local enterprises out of business. There is a process of de- industrialisation in many African countries. It is simply a myth that the Uruguay Round and trade and investment liberalisation benefits everyone. Instead, the rich and powerful are making use of liberalisation to further squeeze out the poor and powerless.

8. The World Trade Organisation is emerging as the most powerful international economic agency, and it is being used by the Northern companies and governments to put new rules and disciplines onto the South that can pry open Southern countries' markets whilst also trying to curb their local development capabilities. Even before the people of the South can understand and absorb the effects of the Uruguay Round, Northern governments are putting intense pressure to place more issues like investment and labour standards onto the WTO agenda. This pressure is tantamount to bullying and is unacceptable.

C. THE CONTINUING DEVELOPMENT CRISIS

9. Whilst the myths on globalisation are being trumpeted, the reality is that many developing countries are still trapped in poverty which to a large extent is caused by unequal and unjust international economic, trade and financial structures.

10. The terms of trade of commodity-producing Third World Countries have suffered long-term trend decline, causing tremendous income losses. The debt problem continues to drain resources. Trade and investment liberalisation threatens the already weakened economies. Intellectual property rights regimes have been put in place that will jack up the prices of technology products and of imports. They will also jeopardise the chances for Southern countries to develop their own technologies and industrial programmes. As a result of unequal structures, the South is transferring several hundreds of billions of dollars of resources annually to the North. These outflows are many times more than the amount of aid, which in the meanwhile has so significantly declined.

11. These are all issues and problems that UNCTAD has been dealing with. That these problems still exist and have worsened shows that there is a dire need for an international development agency like UNCTAD more than ever.

12. We agree that a significant part of the development crisis is also a result of domestic factors, such as wrong policies, mismanagement, abuse of power and investments in ill-conceived expensive projects. NGOs have indeed firecely criticised their governments for these policies and practices. Nevertheless these domestic factors should not be used as a rationale or excuse to put all the blame of maldevelopment on Southern governments, when a large part of the problem lies in the international structures.

13. In order to achieve worldwide sustainable development as well as more equitable development, major structural changes must take place in consumption and production patterns in the North, which is still the major source of the global environmental crisis. Moreover, Northern societies are also facing many social problems, including unemployment and cuts in welfare and social spending, which generate a groundwell of public discontent against liberalisation and globalisation. Problems like inappropriate economic policies and corruption, usually blamed on the South, are also significant in the North. The issue of governance applies not only at national level to the South but equally to the North and even more so to the international level, where there is an absence of mechanisms for fair, equitable and just global governance.

14. In many of the economies of transition, there are also many problems rather similar to those faced by developing countries, particularly the adverse social effects of rapid liberalisation. These problems also deserve the attention of UNCTAD and the international community.

D. INSTITUTIONAL ISSUES

15. As members of civil society, we are very concerned that at national level, there is economic marginalisation as economic resources are rapidly shifting from the people, communities and the state to be controlled by big companies.

16. We are equally concerned that at international level there is a drastic shift in influence and powers away from international institutions with a broad development perspective and agenda (such as UNCTAD and other UN social and economic agencies) towards institutions (such as the World Bank, IMF and the WTO) which are dominated by Northern governments, heavily influenced by interests of international finance and transnational corporations and thus are lacking in the broad development perspective.

17. This shift is against the public interest as policies and perspectives representing broader social interests are being replaced by those representing more narrow business-oriented interests. This may be beneficial to the strong but will marginalise the weak further.

18. We are especially concerned by the efforts of some Northern governments to further erode and whittle away the mandate and areas of work of UNCTAD. For instance, there is a suggestion that UNCTAD's role be restricted to providing technical aid to LDCs. Its roles as forum for development discussion, policy research and advocacy and strengthening the negotiating position of the South in other fora, are being called into question. This is unacceptable as the multiple roles of UNCTAD are invaluable for the South and their removal would make the South even more vulnerable. The existence of the WTO does not imply UNCTAD has become less relevant. On the contrary, because of the emergence of the WTO, there is an even more vital role for UNCTAD as a forum for broad discussion and as a research body with a development orientation.

E. OUR PROPOSALS

19. Controlling and regulating globalisation

* The uncontrolled spread of globalisation and liberalisation cannot be accepted passively as inevitable and irreversible. Civil society demands that governments and international institutions take an active role to control, regulate and rechannel the globalisation process, and making it socially and environmentally accountable.

* The free flow of speculative money which causes financial instability has to be controlled through international regulations. UNCTAD should conduct more studies on these financial issues.

* The activities of transnational companies have to be monitored and checked through appropriate mechanisms. Although the development of a Code of Conduct for TNCs has regrettably been stopped, UNCTAD should play a key role in a revived process of clarifying the obligations of TNCs to host countries, to social development and environmental protection.

20. Negative impacts and the equity issue in trade liberalisation

* It must be honestly recognised that the Uruguay Round had winners and losers. The negative effect on the LDCs and net food- importing countries should be fully compensated through concrete measures that the WTO (in collaboration with UNCTAD) should set up as soon as possible.

* UNCTAD should continuously analyse the impact of trade liberalisation on developing countries, assist in negotiations and in monitoring the problems of implementation.

* The WTO should not be concerned solely with trade liberalisation but should incorporate the issue of equitable distribution of benefits and losses as an integral part of its principles, rules and negotiations.

* All trade barriers (including tariffs) against all products of the LDCs should be removed.

* Developing countries should maintain the right to protect themselves against food imports in order to secure domestic food security.

* Unilateral measures such as the Super 301 instrument of the US should not be used by developed countries. They should also refrain from other devices such as antidumping measures and export subsidies if they are used for protectionist reasons.

21. The future trade agenda

* The main focus in the WTO should be to review problems faced by developing countries and LDCs in implementing the Uruguay Round, since they face immense difficulties in adjusting. The problems should be systematically monitored, and proposals for amending existing trade rules should be made where necessary in order to overcome these problems. UNCTAD should assist in this monitoring and research execrcise.

* Northern countries should refrain from adding new items (such as investment and labour standards) onto the WTO agenda as this would certainly overload the trade system. Such issues should be opened for discussion in UNCTAD and other relevant fora where there is a broad development framework, rather than in the tense atmosphere of the WTO with its rule-making focus, legally-binding nature and dispute settlement system with trade sanctions.

* In particular, we call on governments and the WTO Secretariat to refrain from introducing a multilateral investment agreement that would grant such strong rights to foreign companies to establish themselves in all countries and to be given national treatment. Such an agreement would remove the rights of governments to regulate foreign investments, and this could seriously threaten the position of local economic entities. Such an agreement would also lead the world back to the era of colonialism. UNCTAD should be the venue for discussion on the balance of rights and obligations of investors and host countries.

* In the WTO Ministerial Conference in Singapore in December 1996, Northern governments and the WTO Secretariat must not press ahead with further liberalisation at the expense of developing countries, but take heed of the recent upsurge of civil society's concerns about globalisation. We also urge Southern governments to prepare themselves well for this meeting and to resist the proposals for new issues. The meeting should focus on current and potential adverse effects and the distribution of benefits and losses, and the specific marginalisation problems of LDCs. It should not introduce a new Round or new issues.

22. Removing the barriers to development and boosting sustainable development capacity

* The continuing debt burden of poorer countries and LDCs should be eliminated in a comprehensive solution. In particular, there should be urgent measures for multilateral debt relief.

* Structural adjustment programmes should recognise the specific conditions of different countries, should build social development goals into its design (instead of merely taking a "safety net" approach), and should ensure that the burden of adjustment fall more on the economic elite rather than the poor.

* The drastic decline in ODA should be reversed. The quality of aid should be improved (with an emphasis on poverty eradication and social development) whilst the quantity should be increased in line with the North's longstanding commitments. A higher percentage of aid should go to LDCs, especially in building the self-reliant capacity of their poor communities.

* For the three above issues, UNCTAD should play a more vigorous role in research and in proposals for solutions.

* The longterm decline of commodity prices and continued commodity dependence of many developing countries should be addressed by a comprehensive commodity and trade policy. UNCTAD should be given a renewed mandate to lead a new global effort to aid developing countries to diversify, promote sustainable commodity production and explore new instruments for price and risk management as transitional measures towards balanced, integrated and sustainable economies. The Common Fund for Commodities should be given the needed funds to be effective.

* UNCTAD should also play a more active role in integrating the new paradigms (of sustainable, human-centred development) emerging from the series of UN Conferences, into new development approaches where economic growth focuses on fulfilling human needs in an equitable manner, that is gender sesnsitive and that also protects the environment.

23. UNCTAD'S future role

* NGOs advocate a revitalised UNCTAD with a substantial and stronger mandate. Its future functions should include:

(a) An analytical role: In trade, finance, poverty eradication and development strategies, UNCTAD should provide research and proposals towards sustainable development. UNCTAD must retain its role of providing policy analysis and proposals from a social, equity-oriented and sustainable development perspective that provides a balance to the strongly market-oriented perspective of other international agencies. This would enhance pluralism and healthy competition in ideas and policy prescriptions and prevent a monopolistic position of standard orthodox analysis.

(b) A supportive role for developing countries: In contrast to developed countries which have such strong research institutions such as the OECD, the Southern countries lack a secretariat. UNCTAD's services to support and build capacity of the South for policy making, negotiations and in technical assistance in improving production efficiency is even more important today.

(c) Discussion Forum: UNCTAD should be the major forum for discussing development issues, including linkages between trade and other issues such as investment, finance and technology.

* UNCTAD should also undertake analytical studies on the problems faced by the countries in transition.

* UNCTAD also needs to reform. In particular, there is a relative absence of civil society in UNCTAD activities, which should be addressed appropriately. UNCTAD should encourage the active participation of more NGOS, citizen groups and people's organisations in UNCTAD meetings and activities.

* Developed countries should refrain from further eroding the development oriention of UNCTAD, from eroding the intellectual independence of the UNCTAD Secretariat and from restricting the functions of UNCTAD. Instead they should recognise the important role of UNCTAD particularly in a globalising world, and strengthen its financial resources and its status in the world of international organisations.

* For their part, the developing countries and the UNCTAD Secretariat should ensure that UNCTAD remains true to the original vision and goals of UNCTAD, to strive towards a more equitable economic and social world order, where developing countries (and especially the grass roots communities in them) can build their capacities to fulfil human needs in the attainment of genuine development.


 


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