Remove all trade barriers, Annan tells rich nations

by Thalif Deen

New York, 30 Jan 2001 (IPS) -- UN Secretary-General Kofi Annan Tuesday urged the world’s rich nations to immediately provide “duty-free, quota-free market access” to all non-arms exports of the least developed countries (LDCs) and the heavily indebted poor countries (HIPCs).

Annan said that market access protection by developed countries currently imposes costs that significantly exceed aid flows to developing countries.

If tariff barriers and trade restrictions are removed, he pointed out, the potential gains from the  liberalisation measures could range from $100 billion to $150 billion - all of which would accrue to developing nations.

Total official development assistance (ODA) from the rich to the poor amounted to only about $51.9 billion in 1998, down from about $61 billion in 1992, according to figures released by the United Nations.  Total ODA to LDCs was $12.1 billion in 1998, down from $16.6 billion in 1995.

Of the 48 LDCs, described as the poorest of the poor, 33 are from Africa, including Angola, Malawi, Mozambique, Burundi, Eritrea, Ethiopia and Zambia. Non-African LDCs include Afghanistan, Bangladesh, Yemen and Haiti.

The 40 HIPCs include Benin, Cameroon, Chad, Ghana, Honduras, Nicaragua, Sudan and Zambia. Some of the HIPCs such as Angola, Sudan, Yemen and Zambia are common to both groups.

In a 64-page report released Tuesday, Annan spelled out a series of proposals to help meet the world’s growing development financing needs.  The report will go before a preparatory committee established by the General Assembly for an upcoming meeting of policy makers on “Financing for Development” (FfD). The meeting is scheduled to take place in early 2002 in a as yet unannounced venue. The preparatory committee will meet in New York on 12-23 February and again on 30 April-11 May.

The six chapters in Annan’s report cover the six components of the agenda mandated by the General Assembly for FfD discussions: domestic financial resources, international private flows, trade, international development cooperation, debt and systemic issues (including financial architecture reform, governance and the reform of the United Nations itself).

Annan said that any plans to reduce the growing poverty, ignorance and disease will remain frustrated unless resources - both market-led investment and public funds - are available in sufficient amounts and deployed where most needed.

The report recommends new norms for international cooperation and new mechanisms for implementation. Among the recommendations are new ways to handle debt in crisis situations, strengthen cooperation on tax matters, improve the effectiveness of aid and design appropriate financial regulations for both developed and developing nations.

The report also recommends:

·        Member states should consider the convening of ad hoc global hearings to discuss the issues surrounding international investment agreements, and involving governments, the private sector and civil society;

·        The relevant international organisations should urgently formulate measures to help developing countries deal with commodity price risks, including the possible establishment of a new global facility to facilitate developing-country access to commodity price risk management and structured commodity finance mechanisms and to assist in the development of regional and national commodity exchanges;

·        Bilateral and multilateral creditors should pursue debt relief vigorously and expeditiously, including steps to provide significant and immediate debt relief to the poorest countries. Steps should also be considered to provide, in exceptional situations and where appropriate, for a moratorium or even for debt cancellations;

·        The multilateral development banks should spearhead the development of a major programme to assist developing nations, particularly small and vulnerable economies, in diversifying their export base in terms of both the product mix and destination markets;

·        Donors should undertake an immediate commitment to avoiding any declines in ODA and, in the case of countries where ODA still accounts for well under 0.7% of gross national product (GNP), they should pledge to honour existing commitments to steady increases in real ODA flows within a defined time frame. – SUNS4825