São Paulo, 17 June 2004

Funds for the elimination of hunger, trade preferences among developing countries, reestablishment of the link between trade and employment – these are some of the ideas, which are conceived by the delegates from over 180 nations taking part in the 11thSession of UNCTAD. Intense debates and discussions are taking place to find how best the international community can fight against poverty and to enable poor countries to reap the benefits of international trading system.

Luiz Inàcio Lula da Silva, the President of Brazil called world leaders to support taxes on arms sales and international financial transactions to establish a global fund to eliminate hunger. He argued that easing hunger would allow poor countries to become more productive and democratic. “Hunger not only kills, it withdraws the capability to learn, to work, and most serious, throws away the hope of millions and millions of human beings,”’ he said.

On the 5th day of the meeting, a high-level panel discussion was held to discuss trade and development strategies of least developed countries. Participants called for providing sufficient “policy space” for poor counties in order for them to develop appropriate strategies for poverty reduction. The panel included trade ministers of Bangladesh, Madagascar, Rwanda, former trade minister of Ireland and noted economist Prof. Ignacio Sachs from the School of Advanced studies, Paris, France. The panel recommended that there is a need for paradigm shift in the approach for economic development and poverty reduction and policy autonomy is a crucial aspect. Trade ministers of Rwanda and Madagascar shared their views and importance of “policy coherence” at the global and domestic level.

Another high-level forum focused on “assessment of trade in services and development gains”. According to UNCTAD’s Secretary-General Rubens Ricupero the main concern of developing countries is how to strengthen domestic supply capacity in services and reconcile trade, development and equity considerations. Pursuing domestic policy reforms becomes a major challenge for them, as many times it was difficult to assess impact of different policies on different stakeholders. The ongoing services negotiations at the WTO is posing various challenges. Undertaking specific commitments on trade in services would mean new obligations, binding certain policy options, and developing countries are to be careful in negotiating services liberalisation.

“Assessment of services reform in developing countries” – a joint initiative of UNCTAD, World Bank and UK’s Department for International Development (DFID) was launched on this occasion. Lakshmi Puri, Director of UNCTAD, outlined the purpose of this initiative, which is to fill the knowledge gap to enable developing countries to look at their national interests and assess the possible impact of alternative policies on growth and development and in particular their effect on poverty reduction.

In another interesting development, trade union bodies like the International Confederation of Free Trade Unions and the Trade Union Advisory Committee of the OECD called upon UNCTAD not to become an FDI (foreign direct investment) promotion body. They emphasised that job creation and poverty reduction should be at the heart of the organisation’s mission. They, however, supported various initiatives being taken by UNCTAD to re-establish the linkage between trade and job creation at the centre of development strategy.