ENB @ Financing for Development, 3rd Preparatory Committee Session

International Conference on Financing for Development

New York, USA; 15 - 19 October 2001

Thursday, 18 October 2001
Delegates gathered for the seventh, eight and ninth sessions of the resumed Third PrepCom. In the morning, delegates met in Plenary for a presentation and then continued with informal consultations throughout the day on the Draft Outcome's second section, debating chapters on trade, international financial cooperation and debt

At 10:20 am, Co-Chair Jacoby convened the PrepCom and introduced Rubens Ricupero, the Secretary-General of UNCTAD. Referring to terrorism, he noted there is no international mechanism for dealing with the adversity it has had on industry worldwide, and listed problems with airlines, dropping commodity prices and the availability of finance. Concerned for LDCs, he underlined their limited capacity to bail out their industries or stimulate their markets. He asked the PrepCom to ensure an ordered process and a balanced agenda, geared toward improving governance and coherence in policy

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In section two's third chapter (trade), the G-77/CHINA endorsed trade as an engine for growth and development, and supported paragraph 18, on eliminating barriers and subsidies. In paragraph 19, on environmental and labor concerns, he agreed that these issues should be addressed separately to avoid inhibiting trade; added reference to special and preferential treatment to integrate developing countries in world markets; and proposed adding a new paragraph on the necessity of supporting developing countries to incorporate trade policies. In paragraph 20, on supporting development, he suggested language on sectors for trade and development in developing countries. In paragraph 21, on regional and sub-regional cooperation, he proposed deleting reference to free trade areas as building blocks. In paragraph 22, on market access for developing countries, he suggested reference to "full-scale, stable and predictable" markets. He supported paragraph 23, on stabilizing export revenue, and in paragraph 24, on institutional support, he suggested references to, inter alia, a policy framework for managing trade development strategies to assist LDCs

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José Gilberto Scandiucci Filho, Brazil, questioned the exclusive interest in markets where developed countries have competitive advantages, and called for investing in other markets. He supported free markets and circulation of money

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Alberto D'Alotto, Argentina, said state subsidies in developed countries have increased, stressed the need to eliminate trade barriers, and supported new trade negotiations

John Richardson, The European Commission, on behalf of the EU, said benefits from trade depend on domestic policies; supported broad liberalization without specifying sectors; and objected to full elimination of agricultural subsidies. He stressed, inter alia, domestic poverty reduction; regional integration; and international assistance in trade facilitation, infrastructure and production capacity

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Kenneth Smith Ramos, Mexico, cautioned against denying financial aid to countries that do not meet debt relief conditions

Adrie De Groot, UNIDO, underscored developing countries' ability to market products and adhere to international standards through institutional capacity building

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Delegates in the Plenary

The PreCom Committee chairs and Secretariat

Sonia Leonce-Carryl, St. Lucia, stressed that support for unbridled liberalization is not the PrepCom's overall sentiment. She cited her country's experience with liberalization, which resulted in the closing of local industries and trade deficits, and called for special treatment for developing countries to enable them to compete in the world market

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Zhou Bing, China, said trade is an "engine of economic development" and supported liberalizing trade in agricultural products, lifting subsidies on textiles, and delinking environment and labor

The EU supported ODA targets and halving poverty by 2015; emphasized partnerships, participation and domestic responsibilities; and proposed references to the African Initiative. In paragraphs 25-26, he called for meeting targets, and supported focusing on LDCs with good policies. In paragraph 28, he welcomed OECD dialogue. In paragraph 29, he stressed nationally owned development strategies, ODA priority to LDCs with sound policies and countries emerging from conflict, and untied ODA. In paragraph 30, he stressed capacity building. In paragraphs 32-33, he advocated conceptual discussions on GPGs. He specified references to managing economic and social development in paragraphs 37-38, and distinguished between low and middle-income countries. In paragraphs 39-40, he welcomed bilateral initiatives following HIPC implementation and assessment, highlighted adequate funding in the context of fair burden sharing, and called for clarification on differentiated responsibilities

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The WORLD BANK called for more ODA to meet Millennium Declaration goals; said ODA can only build on a solid domestic foundation; and noted links between debt and ODA

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The IMF supported policy surveillance programs and improved market access for LDC exports. He called for a new trade round, which could link the FfD and the WTO. On debt, he praised reconsideration of amounts needed to reach sustainable targets and examination of financing needs given new environments. He underscored that sustainable debt financing can mobilize resources

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