MEDIA REPORTS
TRADE, FINANCE AND
INVESTMENT IN SUSTAINABLE DEVELOPMENT
This page was updated
on: 01/26/10
2004
Trade, Finance and Investment Media Reports Archives:
2010;
2009;
2008;
2007;
2006;
2005;
2003;
2002
DECEMBER 2004
UN PROMOTES INVESTMENT IN
AGRICULTURE
Greater investment in
agriculture and rural development is needed to combat poverty and meet
the Millennium Development Goals (MDGs), according to the UN Food and
Agriculture Organization (FAO). Marking the 40th anniversary of its
Investment Center, which was established in collaboration with the World
Bank in 1964, the FAO emphasized the development benefits of increasing
funding to support agriculture in developing countries.
Links to further information
FAO
press release, 14 December 2004
GLOBAL COMPACT LAUNCHES
ANTI-CORRUPTION INITIATIVE
The Global Compact recently began an
international effort to raise awareness on and increase commitment
towards combating corruption. Launched on International Anti-Corruption
Day, 9 December, the initiative will focus on providing information,
guidance and tools to Global Compact participants over the next twelve
months. The Global Compact, a voluntary
corporate citizenship initiative supporting a list of principles on
human rights, labor, the environment, added a tenth principle on
anti-corruption in June 2004. The Global Compact will be
collaborating with the UN Office on Drugs and Crime, Transparency
International and the International Chamber of Commerce to hold several
dialogue events and support the collection of corporate practice cases,
which will be illustrated in a report to be published in the fall of
2005.
Links to
further information
Global Compact website
International Anti-Corruption Day website
NOVEMBER 2004
ASIAN STATES ANNOUNCE TRADE DEALS
Several new trade negotiations have
been announced in Asia, with China, Japan and India all in talks
with ASEANthe Association of Southeast Asian Nations. The agreement
with China aims to create a free trade area covering almost
one-third of the world's population by 2015. Meanwhile, Japan and
India are also in discussions to form trade agreements with ASEAN.
Such deals, if realized, are believed to offer significant economic
and development gains for the region. However, economists predict
that they could have a more negative impact on the U.S economy.
Links to further information
ASEAN report,
November 2004
ICTSD Bridges Weekly
Trade News Digest, 1
December 2004
COMPANIES URGED TO REPORT SOCIAL,
ENVIRONMENTAL RISKS
Not enough major companies are
reporting properly on the risks and opportunities resulting from
environmental and social considerations, according to a new report.
Authored by the UN Environment Programme in cooperation with
Standards & Poors and SustainAbility, two private companies, the
report suggests that only three of the world's 50 largest companies
made fully public their assessments of major environmental and
social risks. On the positive side, however, the authors did note
that a vast majority of corporations are now using sustainability
indicators in their reporting.
Green group shocks energy sector: In
related news, conservation group WWF has criticized power companies for
failing to respond to climate change. In a new report, Ranking Power,
WWF reveals that a majority of companies scored less than one out of ten
on criteria judging how effectively they have responded to climate
change. The power sector is the single biggest source of greenhouse gas
emissions.
Links to further information
Corporate sustainability
report, November 2004
WWF report, November 2004
OCTOBER 2004
AFRICAN HOPES
FRUSTRATED
AT IMF/WORLD BANK ANNUAL MEETING
African countries' hopes to increase
their influence in the World Bank and International Monetary Fund
and to seal a deal on debt relief were left unfulfilled at the joint
annual meeting of the two organizations. The 2004 event, held in
Washington, DC on 3 October, concluded without resolving calls for
debt forgiveness for the world's poorest countries. While Britain
had been pressing its donor colleagues to agree to a comprehensive
programme to provide debt relief for developing countries, its peers
took a more cautious approach, with some preferring further
discussions on the matter. Britain's Chancellor of the Exchequer,
Gordon Brown, had argued that the world's most impoverished
countries have been forced to service their foreign debt at the
expense of spending on people's health and education. While the
issue remained unresolved as the meeting concluded, though, World
Bank President James Wolfensohn expressed hope that the matter would
be resolved soon.
Meanwhile, African leaders
have been frustrated in their efforts to raise their influence on the
World Bank-IMF boards. While Europe has 10 seats on the boards, Africa
has just two. However, this issue remained unresolved as the joint
meeting drew to an end.
Links to further information
World
Bank DevNews Media Center, 4 October 2004
BBC news service,
3 October
and 4 October
2004
SEPTEMBER 2004
TRADE LIBERALIZATION NOT ENOUGH, SAYS
REPORT
Trade liberalization by itself is no
panacea for Africa's poverty and underdevelopment problems,
according to a new report. The 2004 Economic Report on Africa:
Unlocking Africa's Trade Potential found that trade
liberalization must be carefully planned and combined with other
policies aimed at economic development if it is to succeed. The
report argued that some African countries have developed free trade
policies that have been applied "haphazardly" and "with too little
relevance to overall development objectives." Gradual and targeted
liberalization and "dynamic trade policies" are more helpful than
liberalization per se, says the report.
Compiled by the UN Economic Commission
for Africa, the new report also ranked countries on their
competitiveness, praising Mauritius, Namibia, South Africa and Tunisia
for their recent economic performances. It noted, though, that only five
countries in the entire continent achieved the 7% annual GDP growth
considered necessary to meet the Millennium Development Goal of halving
poverty by 2015. The report also cautioned against protectionism in the
US and other industrialized countries.
Links to further information
UN ECA press release, 29 September 2004
2004 Economic Report on Africa: Unlocking Africa's Trade Potential
CAMPAIGN FOR TOP TRADE JOB
HEATS UP
The campaign for
Director-General of the World Trade Organization, which will fall
vacant in August 2005, has begun in earnest with at least two
candidates throwing their names into the ring. Trade minister
Jayakrishna Cuttaree of Mauritius is believed to be interested in
the post, while Sergio Marchi, a former Canadian trade envoy, is
also reported to be applying. Carlos Perez del Castillo of Uruguay
has already announced his candidacy. The top job is currently held
by Supachai Panitchpakdi of Thailand, who took on the job in 2002.
Elections may be held as early as December this year.
Links to further information
Geneva Watch,
17 September 2004
Trade Law
Center for Southern Africa news report, 20 September 2004
WEST AFRICAN STATES FORM NEW
MONETARY ZONE; JAPAN, MEXICO SIGN TRADE PACT
Five countries from West
Africa have inked a deal to create a regional monetary zone by July
2005. Ghana, Gambia, Guinea, Nigeria and Sierra Leone have launched
the plan in the hopes of creating a stable currency. This is the
second monetary zone for the region, with several other countries
belonging to the West African Economic and Monetary Union, which is
part of the longstanding CFA Franc zone.
In other news, Mexico and
Japan have signed a free trade deal. The agreement, which negotiators
have been working on since early 2003, raises the quota for tariff-free
automobile imports from Japan, while Mexican officials hope it will wean
the country away from its overwhelming reliance on the United States,
which buys nine-tenths of its exports.
Links to further information
Business Week news, 27 September 2004
ICTSD Bridges Weekly Trade News Digest, 22 September 2004
Ghanaweb business news, 13 September 2004
GLOBAL TAX OPTIONS PRESENTED TO FINANCE
DEVELOPMENT AID
Taxing financial transactions and
arms sales were among the options presented in a key report recently
released by France, Brazil, Chile and Spain at the UN General
Assembly. The report, which seeks to contribute to the ongoing fight
against world hunger and poverty, is the output of a Technical
Group on Innovative Financing Mechanism headed by Jean
Pierre Landau, French Inspector of Finances, which explored feasible
and politically-acceptable alternatives to financing development
aid. Other options presented included the UK-proposed International
Financial Facility and incrementing the issuance of special drawing
rights in the International Monetary Fund. The report further
addressed options such as taking action against tax evasion and tax havens, increasing
remittance benefits, socially responsible investment, and voluntary
contributions through credit cards. While the
report did not consider the potential for a carbon tax to finance
development as originally intended, the group has agreed to discuss
it in the future.
In related news, the lower house of the
Belgian parliament recently approved a currency transaction tax, more
commonly known as the Tobin tax. The proposed legislation is designed to
attract a 0.02 percent tax on currency transactions and would cover
transactions that take place if one of the parties or an intermediary is
in Belgium or if the payment is made in the country. The money raised by
the tax would be managed by the EU for development cooperation,
promotion of social justice, conservation and protection of cultural
heritage.
India is also
expected to pass a securities transaction tax in September. Proposed by
its Finance Minister in July, the tax would draw 0.15 percent of every
transaction in securities that occurs in a stock exchange in India.
Options for utilizing the revenues raised include reducing fiscal
deficit and supporting development and anti-poverty programmes in the
country.
Links to
further information
Report of the Technical Group on Innovative Financing Mechanisms
Inter Press
Service New Agency, 19 August 2004
ZNet South Asia, 19 July 2004
U.S. PUSHES DEBT WRITE-OFF
The United States is
supporting plans to give billions of dollars of debt relief to some
of the world's least developed nations, according to the
Washington Post and other news sources. The plan follows years
of lobbying from advocacy groups to write-off the huge debts
incurred by many Third World countries in previous decades. It also
follows reports suggesting that recent efforts to cut Third World
debt are failing to achieve their aims.
The Heavily Indebted Poor
Countries (HIPC) initiative, which was established in the 1990s to help
reduce poor countries' debt problems, will be the subject of discussions
at the upcoming annual joint World Bank-International Monetary Fund
meeting taking place in early October. The initiative has canceled some
debt, but as much as US$90 billion remains outstanding for the countries
covered by the scheme.
World
Bank Lending Safeguards Queried
Meanwhile, environment and
conservation group Friends of the Earth has accused the World Bank of
planning to water down its environmental and social criteria for lending
money to the private sector. The proposals are part of a review of the
International Finance Corporation, which is the part of the Bank that
lends to the private sector.
Links to further information
Jubilee Debt Campaign news service, September 2004
Friends of the Earth press release, 17 September 2004
IFC Policy Review website
AUGUST 2004
IFC INVITES
PUBLIC INPUT ON ENVIRONMENTAL AND SOCIAL SAFEGUARD POLICIES AND
INFORMATION DISCLOSURE
The
International Finance Corporation (IFC) has launched the public
consultation phase for the update of its Environmental and Social
Safeguard Policies and the review of its Policy on Disclosure of
Information. Established in 1956, IFC is a member of the World Bank
Group and the largest multilateral source of loan and equity
financing for private sector projects in the developing world. Both
initiatives are being undertaken with the aim of improving IFC's
effectiveness as a development bank, bettering the social and
environmental performance of IFC-financed projects, and enhancing
transparency.
According to
the Inter Press Service, the
review is critical as a number of key public and private institutions,
including the OECD and the Equator Principles – a framework for
financial institutions to manage environmental and social issues in
project financing, follow IFC's lead on social and environmental
standards. IFC uses nine performance standards to manage social and
environmental risks and impacts and to enhance development opportunities
in private sector financing for its eligible member countries. The
standards outline recommendations on how to address issues such as labor
conditions, pollution prevention, community health and safety,
biodiversity conservation, and indigenous peoples.
The review will also consider and incorporate
recommendations from the Extractive Industries Review, an independent
assessment of the World Bank's involvement in oil, gas and mining
projects (see story below). NGOs have called on IFC to set higher goals
for its environment, social and disclosure policies, and watchdog groups
are cautioning against possible "white-washing."
The public
consultation process comprises four regional consultation workshops,
stakeholder meetings, web-based consultation, and several topic specific
meeting tackling issues such as labor standards, indigenous peoples'
rights, biodiversity, and the role of the private sector in human
rights. Revised draft documents will be posted in January 2005 for a 30
day public comment period, and new policies are expected to be approved
by the IFC Board of Director in February 2005.
Links to
further information
IFC Consultation Process
http://www.ifc.org/ifcext/policyreview.nsf/content/consultationinformation
Inter Press Service News Agency, 18
August 2004
http://www.ipsnews.net/africa/interna.asp?idnews=25134
WORLD BANK OIL SPAT FLARES UP
The World Bank's recent rejection of
calls to end their financial support for some oil and gas projects
has been called into question yet again – this time by the British
Government. The Bank has been engaged in a review of its involvement
in the oil, gas and mining sectors since 2001 when it launched the
independent Extractive Industries Review (EIR) process that was
headed by former Indonesian Environment Minister Emil Salim. While
Bank officials agreed on new rules designed to ensure that funding
for oil and gas projects did not go to corrupt states, they stopped
short of pulling out of such projects entirely, as the EIR final
report, which was released in December 2003, had proposed.
The Bank's decision has already been
criticized by a number of Nobel Laureates and many environmental groups.
In mid-August, the British Government added its concerns, arguing that
the focus of future funding should be renewable forms of energy, not
fossil fuel schemes.
Responding to the recent criticism, World
Bank President James Wolfensohn has argued that a range of energy
options need to be available in order to bring electricity to the 1.6
billion people in developing countries who currently live without it. He
has argued in favor of "continued but selective engagement" in oil, coal
and gas projects, combined with an increased focus on renewables.
Bank launches new lending policy
In related news, the World Bank has
overhauled its guidelines for policy-based lending, replacing one of
its main lending instruments – Adjustment Lending – with Development
Policy Lending. The new approach, which is the result of two years'
consultation, aims to be less prescriptive and more inclusive than
its predecessor.
"The Bank got too prescriptive [in the
past] and, in fact, was presenting a one-size fits all to governments.
This [new] broader approach will form the basis for [future] Bank
support," said Bank Vice President
James W. Adams in a recent interview. The new approach is also supposed
to take into account questions of sustainability. "Unlike
the original policy in which there was little mention of environment or
social issues, there is now a reference to the importance of vetting
what we are doing to ensure that environmental or social effects are
properly reviewed," said Adams.
Links to further information
Extractive Industries Review website
ENS
Newswire, 16 August 2004
Washington Post,
3 August 2004
World Bank press release, 10 August 2004
World Bank interview, 10 August 2004
DOHA DROPS INVESTMENT ISSUES
Investment issues have been taken off
the agenda of the World Trade Organization's Doha round of trade
talks. The topic reportedly fell victim to opposition from
developing countries during the latest negotiations held in July.
While these negotiations succeeded in getting the Doha round back on
track after the collapse of talks held in Cancun, Mexico, in 2003,
investment rules are not on the Doha agenda.
"WTO members made official what had long
been apparent
that no work [on investment] will take place within the
WTO during the Doha Round," reported IISD's Invest-SD Bulletin in
August.
Some experts have expressed concern at
the multilateral "vacuum" that seems to exist on investment issues.
Meanwhile, the United States, European Union, and other major trading
powers are continuing to work on developing bilateral treaties.
Links to further information
IISD
Invest-SD News Bulletin, August 2004
WTO Doha Work Programme, August 2004
UK BUSINESSES WIN ENVIRONMENTAL HONORS
UK companies are far ahead of their
European rivals in their treatment of the environment and in their
record on human rights, according to a new report. A survey of the
300 largest corporations in Europe found British companies leading
the pack in five sectors, including energy, finance, retail,
telecommunications, and utilities. Nordic countries also posted
strong results, while business from Greece, Italy, Portugal and
Spain received the lowest scores.
Top 20 sustainable stocks announced
In other business
news, the world's top 20 listed companies for 2004 have been announced
by The Progressive Investor, a newsletter published by
SustainableBusiness.com. The list is based on an analysis of companies'
records both o
n
sustainability and financial strength.
Companies such as Canon, Swiss Re and
Electrolux made the list.
Links to further information
WBCSD website (posted from the Ethical Corporation magazine),
August 2004
Progressive Investor newsletter, August 2004
JULY 2004
TRADE TALKS SEAL DEAL ON DOHA FRAMEWORK
Key trade talks in Geneva have ended
in a deal that will revive the stalled Doha round of negotiations –
but only after a marathon negotiating session that ran 24 hours
beyond the agreed deadline. The talks were viewed as a key
opportunity to get the Doha round of trade negotiations back on
track after the collapse of talks at a major ministerial conference
held in Cancún, Mexico, in September 2003. The late July 2004
deadline was set earlier this year in an effort to regain the lost
momentum in the World Trade Organization before other political
events, such as the upcoming US elections later this year, placed
the diplomatic focus elsewhere. Informal and formal discussions have
been taking place since March. During the past two weeks, delegates
had focused on a draft "Framework Text" on the Doha round circulated
on 16 July. A second revised draft was then distributed on 30 July.
The flurry of diplomatic activity culminated in recent few days in a
meeting of the WTO's General Council. Originally scheduled for 27-29
July, the Council extended its deadline to midnight on Friday, 30 July.
However, with delegates still inching towards an agreement as the late
night deadline passed, negotiators agreed to continue their talks. After
a further 24 hours of apparently "grueling" discussions, an agreement
was finally reached late on Saturday, 31 July.
Commenting on the deal, WTO Director-General Supachai Panitchpakdi has
labeled it a "historic breakthrough," arguing that it will greatly
enhance members' chances for successfully completing the Doha
negotiations. Dr. Supachai claimed that the earlier Cancún deadlock was
now broken.
Agriculture pact praised: The deal includes a crucial agreement on
proposals to cut the subsidies farmers receive in wealthy nations such
as the United States and those in the European Union. The breakthrough
is viewed as critical for many developing countries, which rely on
agricultural products for export earnings. An agreement on the cotton
trade was also being hailed by several African countries as a critical
part of the deal.
"For the first
time, member governments have agreed to abolish all forms of
agricultural export subsidies by a date certain. They have agreed to
substantial reductions in trade distorting domestic support in
agriculture," said Dr. Supachai.
As
well as farming subsidies, the final compromise package also covers
other key areas such as market access for industrial products, services,
trade facilitation, investment, competition policy, transparency in
government procurement, and development issues, including special and
differential treatment for developing countries, technical assistance,
and the needs of least developed countries.
It
is estimated that a successful agreement on the Doha round could pump an
additional US$520 billion into the global economy by 2015 – with the
lion's share going to developing countries.
Links to further information
BBC news reports, 31 July 2004
http://news.bbc.co.uk/2/hi/business/3937745.stm
WTO summary of the final negotiations and key outcomes, 31 July 2004
http://www.wto.org/english/news_e/news04_e/dda_package_sum_31july04_e.htm
Final version of the WTO framework agreement, 31 July 2004
http://www.wto.org/english/tratop_e/dda_e/draft_text_gc_dg_31july04_e.htm
Revised draft text for the WTO framework, 30 July 2004
http://www.wto.org/english/tratop_e/dda_e/draft_text_gc_dg_30july04_e.htm
Original draft text for the WTO framework agreement, 16 July 2004
http://www.wto.org/english/news_e/news04_e/sp_draft_text_16july04_e.htm
BWIs CELEBRATE 60TH ANNIVERSARY
The World Bank and the International
Monetary Fund (IMF) recently celebrated their 60th anniversary.
Founded during the United Nations Monetary and Financial Conference
held in Bretton Woods, New Hampshire in July 1944, the IMF and the
World Bank,
also known as the Bretton Woods Institutions (BWI), were established
after World War II to create a stable international financial system
and a global framework for economic cooperation and development. The
Bank addresses economic development and poverty reduction, while the
Fund focuses on the stability of the international
financial system. As part of the celebrations, a virtual
exhibition was launched illustrating the history of the founding of the
two institutions complete with anecdotes and pictures from archives
culled from a variety of sources.
The anniversary was also commemorated
by protesters in various parts of the world, including London,
Jakarta and Bolivia. Celebrations in Washington, DC, where
the BWIs are headquartered, were marked by a divergence of opinions of
the effectiveness of the institutions. From the BWI's perspective, it
has been 60 years of a "strong and prosperous global economy that
benefits all the world's citizens," while according to the Washington
Times, the protesters who were demonstrating outside the World Bank saw
the legacy of the BWIs as 60 years of "plundering third-world economies,
devastating the environment and using debt as a weapon to keep poor
nations in indentured servitude."
Links to
further information
Virtual Bretton Woods 60th
Anniversary Exhibition
http://jolis.worldbankimflib.org/Bwf/index.htm
Washington Times, 23 July 2004
http://www.washtimes.com/upi-breaking/20040723-031456-1246r.htm
Friends of the Earth press release, 22 July 2004
http://www.foei.org/media/2004/0722wb.html
UN
PANEL TARGETS AFRICA'S ECONOMY
A new United Nations panel has been
established to look at levels of international support for Africa's
development. Announced by UN Secretary-General Kofi Annan at the
recent African Union summit, the 13-member panel, which includes
development experts, politicians, and economists, is expected to
support the implementation of the New Partnership for Africa's
Development (NEPAD) established in 2001. The panel will begin by
evaluating the quality and quantity of existing international
support for Africa's economic development. Reporting directly to UN
Secretary-General Annan, the panel will be chaired by former
Nigerian Foreign Minister and Commonwealth Secretary-General Emeka
Anyaoku.
Links to further information
UN News Center, 20 July 2004
http://www.un.org/apps/news/story.asp?NewsID=11414&Cr=nepad&Cr1=
UN TO CONSIDER GLOBAL
TAXES
The United Nations is studying proposals
for global taxes as a means to generate innovative sources of financing
for development. The proposals to be considered include a carbon tax on
fuel use, a tax on currency transactions, an arms sales tax, a global
lottery and a tax on international airline travel.
The issue of global taxation is heavily
opposed by powerful nations such as the United States, Japan and
Germany, but other key countries are seriously considering the idea.
France and Germany, backed by Chile and UN Secretary-General Kofi Annan,
signed a declaration in January re-launching the concept of taxing arms
sales and financial transactions to boost funding for global development
efforts in combating poverty and hunger. The declaration also supported
the United Kingdom's proposal to "frontload" development aid through
capital markets via an International Finance Facility (IFF). The
European Union is divided on the establishment of an IFF, with EU
Commission Poul Nielsen stating at UNCTAD XI in June 2004 that "a
sleight of hand with the rules of public finance - that mortgages future
aid programmes - is no substitute for the hard political task of
securing and sustaining the will to provide increased aid, now and for
many years to come. This leads me to say that the IFF is really not the
right way to go. Fighting global poverty is not something we should
leave to be paid for by our children and grandchildren."
The results of the UN study will be
presented to the General Assembly in September 2004.
Links to
further information
Inter Press Service News Agency, 8 July
2004
http://www.ipsnews.net/interna.asp?idnews=24552
Agence France Presse, 30 January 2004
http://www.globalpolicy.org/socecon/glotax/general/2004/0130armstax.htm
COUNTRY VIEWS ON THE PROPOSED GEF
PERFORMANCE BASED ALLOCATION FRAMEWORK
Written comments forwarded to the GEF to
date caution against a
performance-based allocation (PBA)
framework that would hamper delivery of
assistance that the GEF is mandated to deliver.
During the negotiations for the third
GEF replenishment in 2002, the GEF Council agreed to establish, by the
end of 2004, a PBA system for the allocation of GEF resources based on
global environmental priorities and country-level performance relevant
to those priorities. In May 2003, a working group of technical experts
was established to prepare elements of a framework, and a final report
on the PBA was presented to the Council in November 2003. At its May
2004 meeting, the Council requested the GEF Secretariat to prepare a
study of options to strengthen the current system of allocating GEF
resources, and agreed to convene a seminar in September 2004 to advance
its work on the PBA, in particular, to assist the GEF Secretariat to
prepare a more elaborated proposal. In response to a request for
comments, GEF Council members – Colombia, Denmark, France, Germany,
India, the Netherlands and Pakistan – have recently provided written
comments on the proposed PBA framework.
Responses thus far underscore the need
for a simple, flexible and transparent system that does not detract from
the GEF's overarching priorities. Country comments indicate concerns
regarding, inter alia: the proposed indicators that would be used
to evaluate performance; the use of existing PBA systems such as those
adopted by the International Development Association or multilateral
development banks; the focus on biodiversity and climate change, which
are just two of the GEF's six focal areas; and the subjectivity of
assessments on country environment policy. Some comments warn that
countries needing GEF support but lacking the capacity to launch the GEF
programme would be penalized, and that country needs and capacity will
not be considered. India further stressed that the PBA should not
include macro-level indicators or governance reforms that have no
specific relevance to the GEF's mandate. The Netherlands noted that poor
country performance should not be absolute barrier GEF funding, and with
Germany opposes an ex-ante system where budgets are fixed according to
country performance.
Links to
further information
GEF web updates, July 2004
http://www.gefweb.org/Whats_New/whats_new.html
TRADE DEAL ELUDES DELEGATES AS DEADLINE NEARS
Negotiators discussing an overall
framework for the Doha trade round have yet to reach agreement with
a key deadline just days away. Sources close to the talks report
that agreement on a number of central issues remains elusive.
Intense negotiations were reported at World Trade Organization
headquarters in Geneva throughout late June and into early- to
mid-July. In recent discussions on agriculture – a critical issue
for many delegations – New Zealander Tim Groser, who is chairing the
talks, indicated that a framework text on the issue was under
preparation. However, no major breakthrough was reported.
A
meeting of the Group of 90, a coalition of developing and least
developed countries, saw participants agreeing on elements they would
like to see included in the framework. The G-90's discussions, which
took place in Mauritius from 12-13 July, covered key issues such as
agriculture, industrial market access, and trade facilitation.
Ministerial level talks of the 'Five Interested Parties' group
(Australia, Brazil, the EC, India and US) were also held recently, in
Paris, from 10-11 July. Meanwhile, the Group of Ten, an alliance of
food-importing countries such as Japan and Switzerland, met in Geneva on
5 July in an effort to help move negotiations forward. Members
reportedly criticized the 'Five Interested Parties' group for a lack of
transparency and for excluding other groups from their discussions.
With the outcome of the latest negotiations still in doubt, many experts
were urging a last-ditch effort to ensure that this opportunity to
advance international trade was not lost. A draft framework is expected
to be released on 16 or 17 July, with negotiations likely to continue
through to the end of the month. The next WTO General Council meeting,
scheduled for 27-29 July, is seen as a key deadline for agreeing on a
framework for the next trade round. WTO Director General Supachai
Panitchpakdi has called the July deadline a "window of opportunity" to
make progress before other factors, such as presidential elections in
the United States, begin to intrude on the political landscape.
Links to further information
ICTSD Bridges Weekly News Digest, 14
July 2004
http://www.ictsd.org/weekly/04-07-14/index.htm
BBC news report, 11 July 2004
http://news.bbc.co.uk/1/hi/business/3884657.stm
WTO press release, 12 July 2004
http://www.wto.org/english/news_e/pres04_e/pr382_e.htm
UNEP ANNOUNCES
RESPONSIBLE INVESTMENT INITIATIVE
UNEP recently announced
that it will work with major institutional investors to develop a set of
globally recognized principles for responsible investment by September
2005. Launched on 15 July, the "Responsible Investment Initiative"
follows a June meeting of over 40 investors and fund managers in Paris
at which participants proposed a global alliance of investors to guide
responsible investment best practice. The initiative was launched in
response to this proposal and to a UNEP study, "The Materiality of
Social, Environmental and Corporate Governance Issues to Equity
Pricing," in which UNEP worked with a group of fund managers and
brokerage houses to explore the impact of environmental, social and
governance issues on share prices.
Links to
further information
UNEP press release, 15
July2004
The Materiality of Social,
Environmental and Corporate Governance Issues to Equity Pricing
JUNE 2004
TRADE TALKS GOING DOWN TO THE WIRE
The success of talks to kick-start
the Doha round of trade negotiations remains in doubt as the
late-July deadline approaches. Progress at the political level was
being reported in mid-June at the 11th ministerial meeting of the UN
Conference on Trade and Development, particularly on agriculture
issues. However, at the negotiating level, the Chair of the World
Trade Organization's Agriculture Committee, New Zealand's Tim Groser,
reportedly told delegates that a draft negotiating framework was
"nowhere near ready." Talks between Australia, Brazil, India, the EU
and US held on 22 June apparently saw disputes over a US proposal on
tariff reductions. The discussions took place ahead of a Committee
meeting scheduled for late June.
In other WTO meetings, the Committee on
Trade and Environment reported slow progress in a gathering held on 21
and 22 June, while the Council for Trade-related Aspects of Intellectual
Property Rights (TRIPS) postponed a decision on permanently amending
rules on pharmaceutical products in a meeting held on 16 June. Trade
publication Bridges Weekly reported discussions on genetic
resources, traditional knowledge and folklore as "stagnant."
Links to further information
ICTSD Bridges Trade Weekly News
Digest, 23 June 2003
http://www.ictsd.org/weekly/04-06-23/index.htm
WOLFENSOHN CALLS FOR MORE ENVIRONMENT AID
World Bank President James Wolfensohn
recently highlighted that progress on the environment has been
"alarmingly slow," stating that developed countries are assuming too
little responsibility for addressing the world's environmental
problems. Wolfensohn cautioned that the environment-related goal
adopted by world leaders at the 2000 Millennium Summit might not be
attainable, citing the "fundamental imbalance in the global
environment equation" as a key reason. Noting that an additional 2
billion people will be added to the planet over the next 25 years,
he urged developed countries to increase investment toward
addressing environmental concerns in poorer countries to ensure that
growth is achieved in an environmentally sustainable way and that
its effects on poverty and human well-being would not be disastrous.
Links to
further information
UN wire, 2 June 2004
http://www.unwire.org/UNWire/20040602/449_24456.asp
MAY 2004
POOREST COUNTRIES NEED AID TO TRADE, SAYS UNCTAD REPORT
The world's least developed countries
need a combination of increased aid and trade liberalization to
avoid sinking further into poverty, according to a new report from
the UN Conference on Trade and Development (UNCTAD). The report
makes the case for an increase in aid to build up the production
base of the world's poorest countries so they can benefit from trade
liberalization. It warns against simply opening markets without
providing sufficient ongoing aid, stressing that the two must occur
together. UNCTAD fears that, unless a new approach is taken to the
problems faced by the world's least developed countries, the number
of people forced to live in extreme poverty will jump more than 40
percent by 2015, to almost half a billion.
Links to further information
UNCTAD press statement, 27 May 2004
UNCTAD report, May 2004
UN TEAMS WITH WEF TO MOBILIZE
PARTNERSHIPS
UN DESA is collaborating with the
World Economic Forum with a view to mobilizing public private
partnerships (PPPs) and tapping into the potential of the business
community to help implement poverty reduction and sustainable
development goals. A Memorandum of Understanding between the two
entities has formalized the partnership, which seeks to contribute to
the UN Financing for Development follow-up process and involves a
year-long project comprising a series of multistakeholder workshops.
These expert workshops will explore how PPPs can enhance the reach and
effectiveness of development assistance, and how the climate for private
investment can be improved through leveraging multilateral development
banks and aid agencies and building capacity in the area of financial
governance. The output of these workshops will be reported to the 2005
UN High-level Dialogue on Financing for Development.
Links to
further information
UN Financing for Development
informational flyer on the partnership
UN news, 10 May 2004
APRIL 2004
OECD COUNTRIES
APPROVE NEW CORPORATE GOVERNANCE PRINCIPLES
OECD
countries have agreed on a revised version of the OECD's Principles
of Corporate Governance. Responding to issues that have challenged
investor confidence in recent years, the revised principles urge
governments to ensure effective regulatory frameworks and advise
companies to be truly accountable. Other recommendations include
calls for: disclosure of corporate governance policies;
strengthening the rights of investors and increasing shareholder
rights in board nominations and executive compensation; and rating
agencies and analysts to avoid conflicts of interest.
First published
in 1999, the OECD Principles of Corporate Governance are used as one of
12 key standards by the Financial Stability Forum to ensure
international financial stability and by the World Bank in its work to
improve corporate governance in emerging markets. A revision of the
Principles was called for by OECD governments to incorporate
developments in the corporate sector and the revised guidelines is the
product of a consultation process involving representatives of
government, businesses and professional bodies, trade unions, civil
society organizations and international standard-setting bodies.
Links to further information
The Revised
Corporate Governance Principles
http://www.oecd.org/daf/corporate/principles
BANKS FUEL OIL FINANCING FIGHT
Some of the world's largest banks are
set to join the squabble over the World Bank's continuing support
for oil and coal projects. A major independent review for the World
Bank published in January caused an international dispute when it
called for an end to funding for oil, gas, and mining projects in
developing countries. The recommendation, contained in the
"Extractive Industries Review" report prepared by former Indonesian
Environment Minister Emil Salim, was apparently greeted with
skepticism by key figures within the World Bank. Now, a group of
major banks are reportedly throwing their weight behind those
opposed to the recommendation. Last year, 20 large banks signed onto
the Equator Principles, which commit companies to honor the social
and environmental standards used by the World Bank. According to the
Financial Times, some of these banks are worried they could
be pressured to stop supporting extractive industries should the
World Bank adopt all the recommendations in the report.
Links to further information
Invest-SD,
IISD's Investment Law and Policy News Weekly, 5 April 2004
http://www.iisd.org/investment/invest-sd/archive.asp
Financial Times news report, 5 April 2004
http://www.equator-principles.com/ft4.shtml
GLOBAL TRADE GROWTH SET TO
CONTINUE, SAYS WTO
World trade is set to grow by as much
as 7.5 percent in 2004, continuing the recovery experienced last
year, according to the World Trade Organization. Figures released in
early April show that higher-than-expected economic growth in the US
and Asia in 2003 fuelled increased trade volumes. With global GDP
growth set to increase to 3.7 percent this year, trade is likely to
continue to expand. However, WTO economists have cautioned that any
slow down in import growth in the US, or a drop-off in Europe's
demand-driven recovery, could affect their forecasts.
Commenting on the latest figures, WTO
Director-General Supachai Panitchpakdi warned that, in order for the
full benefits of trade to be realized globally, existing trade
distortions must to be addressed. "The best way to do that is to bring
about a successful conclusion to the Doha Development Agenda," he said.
Links to further information
WTO press release, 5 April 2004
http://www.wto.org/english/news_e/pres04_e/pr373_e.htm
EUROPE'S IMF DOMINANCE CHALLENGED
Europe's dominant role in selecting the
managing director of the International Monetary Fund has been
challenged by Egypt's most senior IMF representative, Shakour
Shaalan. The Egyptian has nominated three candidates for the IMF's
top position, defying a convention that European representatives
select who should serve as managing director. Traditionally, the
significant levels of European and US financial support for the
Bretton Woods Institutions have resulted in Europeans leading the
IMF, while Americans take the top job at the World Bank.
However, developing countries are
seeking a greater say in selecting the IMF's next director. Shaalan has
nominated Stanley Fischer, Andrew Crockett and Mohamed al-Erian for the
post. Fischer is a Zambian-born US citizen, while Crockett is British
and Al-Erian holds Egyptian and French citizenship. According to some
reports, Shaalan's initiative has received US and British support, while
Japan, another major player, has yet to take an official position.
European representatives are believed
to have narrowed their options down to a handful of possible candidates,
including outgoing Spanish Finance Minister Rodrigo Rato, European Bank
for Reconstruction and Development President Jean Lemierre, and EU
Competition Commissioner Mario Monti. European Trade Commissioner Pascal
Lamy has also reportedly expressed an interest in the post.
Links to further information
UN Wire new service, 1 April 2004
http://www.unwire.org/UNWire/20040401/449_22403.asp
All Africa news service, 24 March 2004
http://allafrica.com/stories/200403240325.html
IDEAs Network commentary by C.P
Chandrasekhar, 6 April 2004
http://www.networkideas.org/news/apr2004/news06_Governance_IMF.htm
MARCH 2004
IMF DIRECTORS URGE OPEN AND TRANSPARENT
PROCESS IN SELECTION OF NEW CHIEF
The Executive Directors of the
International Monetary Fund are requesting that the Fund's new
Managing Director be selected from among the best candidates,
regardless of nationality. In the past, the job has always gone to a
European, while the World Bank presidency has always gone to an
American. According to the Financial Times, the IMF Executive
Directors representing Asia, Africa, Latin America and the Middle
East, together with directors from Russia, Australia and
Switzerland, are calling for the new IMF chief to be chosen through
an open and transparent process.
The leading candidate for the position is
Rodrigo Rato, finance minister of Spain's outgoing government, who while
supposedly backed by some European governments does not enjoy the
endorsement of France's Jacques Chirac, who is supporting the candidacy
of Frenchman Jean Lemierre. German Chancellor Gerhard Schröder is also
expected to not endorse Rato.
In an editorial published in the Korean
Herald, Sebastian Edwards, former Chief World Bank Economist for Latin
America, said Horst Kohler's resignation from the Fund's Managing
Director "offers a unique opportunity to reform the embattled
international financial institution. What the IMF needs, as a first step
toward comprehensive reform, is a new leader with solid technical
training, a broad vision and firsthand experience in dealing with the
macroeconomic risks faced by emerging and transition economies."
Links to
further information
World Bank press review, 22 March
2004
Korean Herald, 22 March 2004
BILATERAL TRADE TALKS MOVE AHEAD
Progress has been reported in several
bilateral trade negotiations involving various countries from the
Americas, Europe and Asia. The European Union and Canada have been
in discussions to strengthen bilateral ties, and a high level
meeting in Ottawa held recently confirmed the framework for an EU-Canada
Trade and Investment Enhancement Agreement.
In other bilateral discussions, the US
and the Dominican Republic have announced that a deal has been reached
to bring the Dominican Republic into the US-Central American Free Trade
Agreement. The US and Colombia are set to start free trade negotiations
in May, while the US has also signed an investment framework agreement
with Qatar, which could also lead to a free trade deal.
Meanwhile, Mexico and Japan have agreed a
free trade agreement after 16 months of negotiations. The deal covers
more than 300 agricultural products, and is likely to help Mexico's
export sector. It also abolishes Mexican tariffs on steel products from
Japan over the next 10 years.
Links to further information
Bridges Trade Weekly News Digest,
24 March 2004
http://www.ictsd.org/weekly/04-03-24/index.htm
Bridges Trade Weekly News Digest,
18 March 2004
http://www.ictsd.org/weekly/04-03-18/index.htm
Canada's Foreign Affairs and Trade
Department, March 2004
http://www.dfait-maeci.gc.ca/tna-nac/stories-en.asp
MINISTERS CHAMPION SOUTH-SOUTH
COOPERATION
Politicians from three major
developing countries have pledged to increase South-South cooperation.
At a meeting held earlier this month in New Delhi, foreign ministers
from India, Brazil and South Africa have signed-off on plans to increase
cooperation across a range of areas, including trade, science and
technology, and poverty eradication. The ministers endorsed a new
'Agenda for Cooperation' and a 'Plan of Action' that set out their
shared goals, and agreed to support a new India-Brazil-South Africa (IBSA)
Fund for Alleviation of Poverty and Hunger.
Links to further information
South Africa's Foreign Affairs
Department press releases, 4-5 March 2004
http://www.dfa.gov.za/docs/2004/ibsa0304.htm
http://www.dfa.gov.za/docs/2004/ibsa0305.htm
http://www.dfa.gov.za/docs/2004/ibsa0305a.htm
The Hindu
newspaper online, 6 March 2004
http://www.hindu.com/2004/03/06/stories/2004030603541200.htm
ICTSD Bridges Weekly Trade News, 10 March
2004
http://www.ictsd.org/weekly/04-03-10/story3.htm
TRADE TALKS ON TRACK FOR MIDYEAR RESTART
The Doha trade round could be back on
track by the middle of the year, according to several key figures
involved in the process. Top negotiators from the United States and
Europe have spoken in favor of a midyear meeting to establish the
"negotiating frameworks" for the Doha trade round. WTO Director-General
Supachai Panitchpakdi has also spoken publicly about his hopes to hold a
high-level General Council meeting in July, although whether it would
involve ministers or be formal or informal remains unclear. The deadline
for concluding the Doha trade round is currently set for January 2005,
although many commentators believe this target date may need to be
extended.
Links to further information
ICTSD Bridges Weekly Trade News, 3
March 2004
http://www.ictsd.org/weekly/04-03-03/story1.htm
US URGED TO TAKE DOHA LEAD
The United
States has been called on to take the lead in the Doha trade talks – and
warned about heading down a unilateral path on global issues. In a
recent speech to the National Press Club in Washington, DC, WTO
Director-General Supachai Panitchpakdi urged the US to take the
initiative in the current Doha round, warning that it had a lot to lose
should negotiations fail. He also rubbished the idea that there is an
alternative to the WTO, calling the idea a "fiction" that is "both naïve
and dangerous." He also claimed that multilateralism has become more
important than ever to advancing US interests, and said the Doha round
offered a "once-in-a-generation opportunity" to eliminate trade
distortions, strengthen trade rules and open markets across the world.
Meanwhile, the Bush administration has released its annual trade policy
report, setting out its aims for 2004. The report reiterates the
government's policy of pushing for global, regional and bilateral trade
agreements, an approach reflected in the numerous initiatives pursued in
recent months. Reflecting on the past year's work, the report highlights
free trade agreements with Chile, Costa Rica, El Salvador, Honduras,
Guatemala, Nicaragua and Morocco. Talks are also being held with
Bahrain, the Dominican Republic, Thailand and the Southern African
Customs Union, while negotiations are also slated with Colombia, Panama
and Peru.
Links to further information
WTO Press Release, 26 February 2004
http://www.wto.org/english/news_e/spsp_e/spsp22_e.htm
Invest-SD,
IISD's Investment Law and Policy News Weekly, 5 March 2004
http://www.iisd.org/investment
FEBRUARY 2004
NOBEL LAUREATES URGE WORLD BANK TO STOP
FINANCING OIL AND COAL PROJECTS
Six Nobel Prize winners have urged
the World Bank to stop financing all oil and coal projects through a
letter presented at a recent meeting in Melbourne. The letter comes
on the heels of
the Extractive Industries Review -
a two-year examination of the World Bank's role in
funding oil, coal and gas-mining projects in developing countries, which was drafted by former
Indonesian Environment Minister Emil Salim in consultation with
various industry, government and environmental group
representatives. According to recent news reports, the Bank's
management team rejected a key recommendation that funding for such
industries should be phased out. Senior bank officials apparently
felt that some fossil fuel projects stimulate economic growth and
reduce poverty, two of the institution's main aims.
In their letter, Archbishop Desmond Tutu,
Jody Williams, Sir Joseph Rotblat, Rigoberta Menchu Tum, Betty Williams and Mairead Maguire
urge the World Bank "in the strongest possible terms to embrace the
spirit of the report and accept the recommendations in their entirety
when devising a strategy for moving forward
War, poverty, climate
change, greed, corruption, and ongoing violations of human rights – all
of these scourges are all too often linked to the oil and mining
industries. Your efforts to create a world without poverty need
not exacerbate these problems. The review provides you an extraordinary
opportunity to direct the resources of the World Bank Group in a way
that is truly oriented toward a better future for all."
Links to
further information
UN Wire, 23 February 2004
http://www.unwire.org/UNWire/20040223/449_13363.asp
AllAfrica.com, 23 February 2004
http://allafrica.com/stories/200402230014.html
Extractive Industries Review website
http://www.eireview.org/
UK PUSHES PLAN TO DOUBLE GLOBAL AID
SPENDING
One of the UK's leading politicians has
defended plans to support a massive increase in aid spending among donor
countries. Britain's Chancellor of the Exchequer, Gordon Brown, has
responded strongly to criticism of his recent calls for an extra US$50
billion a year in aid to be raised by the world's industrialized
nations. Mr. Brown, who is responsible for setting the UK's finance
policies, has called for innovative new methods to raise the additional
funding experts believe is required to meet UN targets on poverty agreed
in 2000 during the Millennium Summit. His ideas, which include a
proposal to float bonds on the financial markets, have reportedly met
resistance in some quarters, including a number of policy makers in
Washington.
However, the Chancellor has defended his
position, arguing that increasing aid should be a priority for the
world's wealthiest nations. "We must act, not only because it is morally
right but because it is now essential for stability and security," he
claimed in an article co-written with World Bank President James
Wolfensohn for The Guardian newspaper. Brown hopes to push for
progress this year during talks on the proposed international finance
facility, and again in 2005, when Britain will chair the G8 meeting of
the world's largest economies.
Links to further information
The Guardian
newspaper, 16 February 2004
http://www.guardian.co.uk/medicine/story/0,11381,1149073,00.html
US-AUSTRALIA TRADE DEAL DRAWS MIXED
REVIEWS
A new trade pact negotiated by the US and
Australia has received a mixed response in both countries, with some
experts expressing concerns at the deal's environmental consequences.
The bilateral trade treaty, which was announced earlier this month, was
hailed by both sides as a success that would deliver valuable trade
benefits for both nations. The new deal is the first free trade
agreement between the United States and another industrialized country
in 16 years.
However, critics have said the treaty
fails to deliver some of the hoped-for economic benefits, particularly
on Australia's side, where key breakthroughs on trade in sugar and other
commodities were not achieved. The deal has also fallen foul of some US
lobby groups, with the Grocery Manufacturers of America saying it did
not go far enough. Meanwhile, a number of experts are also concerned at
the environmental impacts of the new trade agreement. The Humane
International Society is reportedly fearful that the agreement, which
removes tariffs on canned tuna, could threaten Australia's tuna stocks,
some of which are already considered to be overfished. In Tasmania, the
treaty has been slammed by the local Green Party, which claimed it could
result in the island being exposed to genetically engineered crops.
Links to further information
ENS Newswire, 11 February 2004
http://www.ens-newswire.com/ens/feb2004/2004-02-11-01.asp
ICTSD Bridges Weekly Trade News, 12
February 2004
http://www.ictsd.org/weekly/04-02-12/BRIDGESWeekly8-05.pdf
US LAUNCHES NEW AID
POLICY
The Board of Directors of
the Millennium Challenge Corporation (MCC) met for the first time in
February to launch the corporation that will administer the Millennium
Challenge Account (MCA), an assistance initiative that will total $5
billion annually by 2006, representing a near 50% increase over current
U.S. core development assistance. Announced by
US President George Bush in 2002, the MCA is intended to "reward
sound policy decisions that support economic growth and reduce poverty."
Countries
eligible to borrow from the International Development Association and
with national per capita incomes up to $1,415 will be considered in
fiscal years 2004 and 2005. Countries with incomes below $2,975 can be
considered in FY 2006. Countries must demonstrate commitment in all
three identified policy areas – good governance, investment in health
and education of their citizens, and promotion of economic freedom – in
order to qualify for assistance. Sixteen indicators developed by the
World Bank, IMF and other international institutions have been selected
to evaluate and monitor performance in these policy areas. MCA critics
say the initiative might harm ineligible poor countries that will have
to compete for smaller amounts of traditional aid.
Chaired by
US Secretary of State Colin Powell, the MCC also comprises Secretary
of the Treasury John Snow as Vice Chairman, US Trade Representative
Robert Zoellick, USAID Administrator Andrew Natsios, and an additional
five member who are yet to be appointed. During its first meeting, the
board appointed Alan Larson, US Under Secretary of State for Economic,
Business, and Agricultural Affairs, as its interim CEO, approved the
list of candidate countries eligible for MCA assistance, and endorsed
the corporation's bylaws. A report on selection criteria and methodology
will be forwarded to Congress in early March following which it will be
open to public comment for 30 days. The MCC Board will meet again in May
to select the eligible countries who will then be invited to develop a
proposal to receive MCA assistance.
Links to
further information
US
Department of State press release, 3 February 2004
http://www.state.gov/r/pa/prs/ps/2004/28848.htm
USAID press release, 3 June 2002
http://www.usaid.gov/press/releases/2002/fs_mca.html
Millennium Challenge Account website
http://www.mca.gov/about_overview.html
COSTA RICA JOINS REGIONAL FREE TRADE ZONE
Costa Rica has announced its intention to
join the Central American Free Trade Agreement (CAFTA), a treaty
concluded last year between El Salvador, Guatemala, Honduras, Nicaragua,
and the United States. The agreement is designed to cut tariffs on goods
and to open up trade in services.
In other trade-related news, a recent
summit in the Republic of Congo saw 11 heads of State from central
Africa pledge to establish a free trade zone by 2007. Meanwhile,
Singapore and South Korea have expressed their intention to sign a free
trade agreement by the end of the year, while Brazil has proposed a
trilateral trade pact with India and South Africa.
Links to further information
ICTSD Bridges Weekly News Service, 4
February 2004
http://www.ictsd.org/weekly/index.htm
JANUARY 2004
OECD INVITES PUBLIC COMMENT ON REVISED
DRAFT OF ITS CORPORATE GOVERNANCE PRINCIPLES
The Organisation for Economic
Co-operation and Development is inviting the public to comment on a
draft revision of its Principles of Corporate Governance adopted by OECD
governments in 1999. The OECD Principles recommend minimum requirements
for best practice in corporate governance. While non-binding, they serve
as a reference for corporate governance initiatives globally,
underpinning the corporate governance component of the World Bank/IMF
reports on standards and Codes, and providing a reference for national
legislation and regulation. Revisions and reinforcements of the
Principles were called for by OECD governments in response to recent
corporate scandals. The final revised version of the Principles is
planned for submission and approval at the annual OECD Council
Ministerial in May 2004.
Links to
further information
OECD press release, 12 January 2004
http://www.oecd.org/document/24/0,2340,en_2649_34487_
23892248_1_1_1_1,00.html
up to top
