lundi 17 décembre 2007

14.12.2007: UNCTAD/Trade and Development Board: Consultations of the President of TDB (afternoon)

This afternoon, the document being discussed was the PROGRESS REPORT ON THE IMPLEMENTATION OF THE RECOMMENDATIONS IN CLUSTER I. Most of the points discussed were not controversial, and mainly the chair was presenting its document, explaining the work done to prepare it.

Mrs. Puri noted that recommendation 5 concerns UNCTAD’s core area of competence (trying to build partnerships with other organizations in different areas...)

Portugal noted that the document still contains mistakes; the NGO list incomplete, contains some typos, some incorrect e-mail addresses, lists Albania instead of Austria…

The USA noted that they want to make sure only issues that actually fall under UNCTAD’s mandate appear in the implementation report. If an issue does not appear, they argued, then it should not be considered in UNCTAD’s mandate.
The chair responded that the members will determine UNCTAD’s mandate, not the document presented.

Argentina praised the document - mostly recommentadions 5 and especially 6; they declared a wish to expand their work with civil society.

Chair: Working with ILO, ITC, other organizations on many of these issues (non-tariff barriers), working with UNDP…

Portugal: Page 4, UNCTAD’s biofuel initiative…
Portugal argued that the lack of reference to the integrated framework (IF) is bad, seeing as UNCTAD is one of the 6 agencies responsible for the integrated framework. Financing should occur through the integrated framework rather than through extra-budgetary resources.

Chair (Mrs. Puri) – one of the main problems being focused on is brain drain and lack of skilled individuals in developing countries…

Uganda: Recommendation 18, criteria for countries’ participation?

The chair also asked for all countries to find more participation of civil society organizations… All countries were called on to look for various domestic civil society organizations.

The U.S. requested that any reference to climate change be removed from the document, as it’s already being discussed in Bali.
The chair replied that it could not be removed, as the secretary general of the UN himself had already identified climate change as the major challenge, for developing countries as well; it must NOT be removed from the agenda.

- Nathan J. Wooden

14.12.2007: UNCTAD/Trade and Development Board: Preparatory process for UNCTAD XII (morning)

This morning, the consolidated UNCTAD XII pre-Conference negotiating text was presented to all UNCTAD members to be discussed. There were various points of disagreement - generally, delegates from the European Union, Japan and the USA wanted to limit the text as much as possible and make sure that it did not reference subjects not within UNCTAD's "competence", while G77 countries - most notably Brazil - wanted to maintain a large version of the text, declaring that UNCTAD also can contribute in areas such as trade and financial stability.

Paragraph 21:
Here, there was much discussion about the terms "integration" and "cooperation". The U.S. wanted to keep both words in, keeping the text as general as possible. Brazil insisted that "integration" and "cooperation" are two similar, but different concepts (first comes cooperation, then integration CAN follow, but doesn't in all cases) and wanted to emphasize separately how EACH of the two concepts is important.

Paragraph 21bis:
The United States delegate, supported by Portugal (who was representing the EU all morning) wanted to strike this entire paragraph because it sounds too "negative" and suggested combining paragraphs 21 and 21bis, mainly using the wording of paragraph 21. The U.S. also objected to the use of the term "unfettered market forces". One of their further points was that this text should not be talking about financial markets, as that is in the competence domain of the Bretton Woods institutions.
Once again, the delegate of Brazil and some other G77 countries objected to the U.S. and EU suggestions, arguing to keep paragraph 21bis.

Paragraph 22:
Once more, Brazil objected to the U.S. delegations changes to the last line ("efforts to build a cooperative monetary system" instead of "efforts to build a truly cooperative monetary system at all levels"). The U.S. maintained that it believed these words to be unnecessary, Portugal even suggested deleting the entire paragraph. But Brazil maintained that the sentence should be left in its complete form.

Paragraph 23:
Here, the U.S. maintained that the text should speak about "international" rather than "harmonized" standards.

Paragraph 24:
This paragraph was a source of very heated debate. The United States suggested deleting the entire paragraph, arguing that financial crises happen and have always happened and that little can be done to prevent them. And, the measures to be taken fall in the competence area of the FFD, not UNCTAD. Portugal also argued that UNCTAD does not have a mandate in this area. However, many G77 countries spoke out against the deletion of this paragraph; Brazil argued that crises can indeed be controlled (even if not prevented in all cases) by regulating speculation, and they also maintained firmly that this is not only the IMF's competence area; UNCTAD can also contribute to financial stability measures and already has. The delegate from the Philippines also argued that it was irresponsible to assume that since crises can't be prevented, one should simply do nothing about them. Iran went so far as to say that this was actually a core mandate of UNCTAD, and that the paragraph should absolutely stay.
At this point, the United States took the floor again and argued that UNCTAD would be stepping out of its area of competence in making policy recommendations to the world in financial and monetary issues, since this was clearly the mission of the IMF and World Bank. The US delegate also argued that the real problem causing financial instability was not at the international level, but bad governance, corruption and lacking accountability at the level of national governments. Brazil once again took the floor and maintained that in some small countries, it may be the case that financial crises were a purely domestic problem, but crises in big and developed countries have a much more devastating impact on the global community; thus, developed countries have a systemic responsibility in this area. Russia also sided with Brazil in this debate. Portugal once again maintained that this was not UNCTAD's area of competence, but Brazil replied that UNCTAD is already acting in this area. To underpin his argument, he cited a brief on the current subprime crisis issued by UNCTAD, as well as the Integrated Framework, where UNCTAD is one of the 5 participating organizations, along with the WTO, the IMF and the World Bank.

Paragraph 25:
Brazil took the floor first, objectiong to the EU's proposed deletion of the first sentence (concerning preventive measures to debt crises). The USA responded by suggesting to delete the entire paragraph, claiming that it was "too technical" and inappropriate for UNCTAD. The USA went on to explain that UNCTAD was the wrong forum to discuss this type of problem and that UNCTAD's work would be more meaningful if it was confined to the limited areas of trade and development rather than "overstepping" its competence and becoming "watered down". Portugal sided with the United States, maintaing that if their amendments were not accepted, they also preferred to delete the entire paragraph. Brazil responded the the U.S. argument of UNCTAD overstepping its area of competence by explaining that financial and monetary stability are crucial elements regarding trade and development; they are largely interrelated, thus UNCTAD does indeed have a mandate to make suggestions and policy recommendations in these areas as well.

Paragraph 26:
Brazil took the floor first, requesting that the USA and the EU explain their modifications. The USA responded by suggesting to delete the entire paragraph and replacing it with 26alt. Russia and Portugal also preferred 26alt, although Portugal requested that ODA's be mentioned in 26alt if 26 were deleted. The U.S. delegate agreed to ask her government to agree with adding ODA's. Brazil, however, objected to this change and maintained that they preferred the original paragraph 26.

Paragraphs 27 and 27alt:
The USA took the floor first, showing its support to the EU's amendments to paragraph 27. This time, Brazil also agreed. However Paragraph 27alt cause more discussion. Japan, the USA and the EU all suggested deleting this paragraph, but Brazil, Algeria and Iran argued against this step. Iran also argued against the mention of the Paris declaration in these two paragraphs, since it was not a completely multilateral agreement that was not completely agreed on internationally. The USA was quick to respond that if this were the case, then the entire text would have to be changed and all references to non-universal institutions would have to be removed.

Paragraph 28 and 28alt:
Japan suggested deleting paragraph 28 and replacing it with 28alt. Brazil argued that it was very important to keep the reference to the "challenges of globalization". Cuba also intervened at this point, objecting mainly to the last sentence of Paragraph 28alt (which had been added by the USA); they argued that UNCTAD's role should be to reduce poverty, not to merely promote globalization and free trade.

Paragraph 29:
Brazil took the floor first, objecting to the EU's deletion of the first sentence here. However, all states present were able to come to a consensus to remove sub-paragraph d) here.

Paragraph 29bis:
Brazil suggested deleting this entire paragraph, as its reference to "resource-rich" countries was more confusing than helpful.

- Nathan J. Wooden

15.12.2007 - Investment Promotion and Business Linkages (Special Session to train Angolan delegates)

Investment Promotion & Business Linkages
Special session: Promotion strategies for Angola


(1st speaker: Prof. Mike Pfister)

According to the professor, the main way for foreign direct investment (FDI) to benefit developing countries is through linkages between foreign firms and local firms. These “linkages” can be divided into different stages:

Stage I (weakest): Ex. Angola: foreign presence of the company BASF – few and only basic linkages at a local level because goods produced abroad

Stage II: Some domestic production, more linkages…

Stage III: Regional hub (Ex. Nestlé Nigeria is not only supplying Nigeria, but also the rest of the region, concentrating production in Nigeria, thus offering increased possibilities of linkages…)

Stage IV (strongest): World Product Mandate (Ex. Daimler Chrysler in Brazil is integrated in the global value chain: these are the most strategic and competitive type of linkages) è this stage can lead to the highest benefits for a country and thus to the strongest type of linkage!


What are linkages? Transnational Companies invest in “host countries”, building up their own business there while working with secondary suppliers, all the way down to 3rd level (local manufacturers) è the linkages refer to the production interdependences between the foreign company and local suppliers.

Example: In the textile industry (garments “supply chain”), the highest level of added value is in the final level, so it is strategically important to retain this part of production in a country… Linkages can also incur in low-income countries and/or low-productivity sectors of the workforce…

Public policies matter very much! Optimally, their goal is strengthening SME’s and strengthening FDI attraction. One must attract the RIGHT sort of investment however, and target SME investment. For example, a small company working with a large company can learn a lot (if it can absorb the knowledge brought in by the large company).

A successful example of linkage policies: exemption from corporate income taxes for 5 years if a foreign company promotes technological investment (Malaysia).

One can also use a sub-national approach (South Africa: Durban, Malaysia: Penang, Mexico: Monterrey – IT sector)

Usually, public-private partnerships help enforce linkages

Project in Brazil: UNCTAD – GTZ – Instituto Ethos – Fundação Dom Cabral - SEBRAE è “Projeto Vínculos” (“Linkages project”)

Multinationals will work with and TRAIN suppliers… However, they will not go into management issues. So, small suppliers must be able to adhere to contracts in order for linkages to be able to be built up successfully.

Implementation of the project: Organize the demand of large companies for local suppliers, facilitate communication,…

There 3 levels of government intervention that can encourage linkages: 1) (Public) policy level, 2) institutional level (Brazil: SEBRAE, SENAI, SESI,…), 3) Micro level: Companies (Individual transnational corporations and SMEs)

In Brazil, the steering committee of the linkages project consists of: UNCTAD, GTZ, SEBRAE, FDC, ETHOS

Examples of linkages projects developed in Brazil:
Project 1 (Bahia): Bosch, Veracel, Lyondell with 30 SMEs // The steering committee has helped in upgrading in process management

Project 2 (São Bernardo do Campo): BASF, 10 SMEs… Upgrading in safety, health & environment…

Linkages / Investment Promotion:
Often, investment promotion agencies (IPAs) can be crucial!! The IPA needs to have a database of suppliers, organize matchmaking meetings between multinational corporations (MNCs) and SMEs and host the linkages center.


2nd speaker: Joachim Karl (Sectional Investment agreements, UNCTAD)

The sectional investment agreements (SIA) has 3 pillars of work:
- Information Provision through International Investment Agreement (IIA) databases è See Internet database concerning which investment agreements which countries have concluded, dispute settlement system…
- Policy Research and analysis (Ex. Study to be published on the past 60 years of investment agreements)
- Technical assistance

Core elements in international investment agreements (IIAAS)
- Objective: The promotion & protection of foreign investment
- Investment promotion through protection
- Core protection provisions
o Principle of fair and equitable treatment
o Principle of non-discrimination – national and “most-favored-nation” treatment (NT/MFN)
o Expropriation (definition of conditions, compensation rules…)
o Transfer of funds
o Dispute settlement

The network of IIAS:
- Bilateral investment treaties (BITs)
- Free trade agreements with investment provisions (FTAs)
- Multilateral agreements dealing with investment (GATS, TRIMS, TRIPS)
- Regional integration agreements (examples: EU, MERCOSUR, CARICOM, COMESA, ASEAN,…)
è Today, a total of ~2500 investment treaties exist, and about 70 agreements made per year.

Top 10 signatories of BITs, end of 2006: 1. Germany, 2. China, 3. Switzerland, 4. UK, 5. Egypt, 6. Italy, 7. France, 8. Netherlands, 9. Belgium + Luxemburg, 10. South Korea

(USA not in list because huge country with lots of internal investment; also, it started later than European countries – spent much time developing NAFTA and leaving behind BITs)

Types of BITs: 40% developed with developing countries, 27% developing – developing countries (“South-South” agreements) è Enormous increase in South-South agreements since the beginning of the 1990s

Proliferation of FTAs with investment provisions since the beginning of the 1990s

Participation of LDCs in the IIA network
- Over 400 BITs
- Regional integration groups (ASEAN, COMESA, ECOWAS, SADC)
- The involvement of LDCs in bilateral FTAs remains limited

Top 10 LDC’s, BITs concluded:
Yemen, 2. Sudan, 3. Bangladesh, 4. Ethiopia…

BITs concluded by Angola with Cape Verde, Germany,… (5 signed, only 2 ratified)

Number of investor – state dispute cases (end 2006): huge rise in dispute cases (slowdown in 2006)

“Spaghetti-Ball” of international investment agreements, involving whole world… Timor Leste doesn’t appear to be involved in barely any of the IIAs.


Some characteristics of the existing IIA universe:
- universal (every country is involved in it)
- atomisation (very different from the trade field with the WTO and multilateral rules to which everyone adheres; all treaties are still negotiated bilaterally, making them difficult to understand, sometimes even contradictory to each other
- multilayered and multifaceted (Countries sign bilateral as well as regional agreements; there are more and more integrated approaches to economic cooperation)
- Investment PROMOTION is pursued indirectly through investment PROTECTION.
è The atomisation leads to isolation of countries because the network is so complicated..

Coping with the complexity of this system is a major challenge for all countries, particularly developing countries!
There are concerns that IIAs do not do enough to promote FDI.
However, IIA treaty making also offers opportunities for countries to become innovative and to seek specific approaches in furthering their development goals, for instance as far as investment promotion is concerned.

Investment Promotion in IIAs:
Some challenges that countries face today:
- There has been increase in investment disputes; some think protection goes too far while not achieving the desired result of higher investment flows è ex: “expropriation” originally conceived as formal claiming of ownership through a government, but often construed as a government simply regulating an investment, for example through environmental standards.. and firms interpret this as “expropriation” because they argue that their investment no longer makes sense due to the new rules!

All IIAs include:
- non-discrimination principle (National Treatment, Most Favored Nation Clause…)
- Fair and Equitable treatment
- Performance requirements (for example, investor only gets tax relief in certain conditions)
è These provisions give reassurance to foreign investors about their treatment, but also limit the discretion of host countries in designing investment promotion measures.

- Most IIAs do not contain any specific investment promotion provisions
- However, the minority that does include such provisions shows a great variety of approaches.

Some elements of investment promotion measures in IIAs:
- encouraging the organization of investment seminars, fairs, exhibitions,…
- Linkages between foreign investors and local firms
- fiscal or financial incentives (this can occur either through home or host countries!)
- Easing informal obstacles to investment (“red tape”)
- Big question: Are these legally binding provisions or not?

2 Main policy options for states:
- Improve GENERAL framework for foreign investments, or focus on INDIVIDUAL investments?

2 approaches to attracting investment:
- laissez-faire (just try to have a favourable general framework and hope that it will attract FDI)
- strategic investment policy: sector- or activity-specific promotion measures

Goals:
- gain competitive advantage in attracting FDI
- target specific sectors for FDI
- increase transparency (formalize existing measures, increase assurance for investment

Costs:
- may be expensive in financial or fiscal incentives (è capacity restraints for developing countries!)
- may result in “windfall gains” for foreign investors who would have come anyway, but will now have huge profits due to incentives, at the cost of their host country…
- Investment promotion provisions in IIAs are no guarantee that investment flows will actually increase

Investment promotion is not yet strongly developed in IIAs
However, even investment promotion makes no sense without sound domestic policies.

www.unctad.org/iia (IIA Databases, IIA Issues series “Pink Series”, IIA Monitor – 4 times a year, talks about recent developments)

In practise, there are often 2 levels.. an “umbrella” IIA, but then specific investment contracts between a company (ex. oil company) and a government, for big investments (“direct umbrella”


The Integrated Framework (IF)

3rd speaker: Céline Maccro

Trade as a catalyst of growth:
è The IF is open to all the LDC’s meeting certain criteria, it has 6 core agencies (IMF, ITC, UNCTAD, UNDP, World Bank, WTO) and about 20 donors that contribute…

Commerce is seen as an important factor of development.

$200-400 million over 5 years would be required (task force estimate)

What is needed at the Geneva level?
Steering Committee to provide overall policy direction, review progress and provide a platform for the exchange of experience
Board to provide oversight and policy direction

The IF in Angola
- Angola member since 2004
- Preliminary mission held in 2004
- DTIS started in October 2005
- DTIS National Validation workshop held in Luanda, 11-12 July 2007 in presence of the minister of trade, M. Muafumba and IF Focal Point, M. Lusevikueno (commerce minister); ANIP staff and private sector representatives were also there.

Tomorrow: action plans for Angola, strengths an weaknesses of Angola as an FDI location è opportunities arising from these strengths, companies in discussion for investments, opportunities for linkages & skill / know-how transfers,… //
Threats facing Angola coming from the weaknesses of Angola and competing FDI locations, what can be done to keep these threats from keeping FDI away…

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

Workshop:

Angola’s opportunities in the global market for FDI:
Development of basic infrastructures (roads, highways, railways, hospitals and schools)
Specialization of human resources based on sectors
Tourism economy + agro-industry
Development of the integrated and supranational networks of telecommunications
Insertion of high-tech into the key sectors of the national economy

Angola’s main threats in the global for FDI:
Political instability / Dependence on the oil sector
Bad governance: excessive bureaucracy and corruption / natural and environmental threats due to the bad use of resources
Macroeconomic instability
Bad management of national assets & “brain drain” / Insufficient investment in the education sector
Absence of policies directed toward the domestic private sector / Lack of having established a stable regional market.


Interesting information for Timor-Leste:
Possibility of Distance Learning (in the “Train for Trade” program to help LDC’s increase their trade)
Train for Trade website (“Formação Portuária”, in Portuguese): è “A gestão moderna dos Portos” (how trade works, rules, how to run a port, customs rules & regulations,…)

Links to some of the material presented:
http://learn.unctad.org/course ….
http://learn.unctad.org/mod/resource/view.php?id=1936
http://learn.unctad.org/course/view.php?id=21

Objectives for Angola:
Develop training courses (“e-learning” courses!)
Educate people that can form Angolans
Organize national seminars to promote investment

- Nathan J. Wooden

mercredi 12 décembre 2007

The Implementation Game: Developing Countries, the TRIPS Agreement and the Global Politics of Intellectual Property

5 December 2007

Dr. Carolyn Deere – Director, Global Trade Governance Project, Global Economic Governance Programme, University of Oxford

The TRIPS Agreement triggered an intense global debate on the relationship between intellectual property (IP) regulation and development. As TRIPS is implemented through measures at the national level, an analysis of the implementation imposes itself to understand the impact of the agreement on development countries.

Dr. Deere reviewed the evidence on TRIPS implementation, noting a variation in the use of the “flexibilities” mechanism by developing countries. She found that some LDCs were not taking advantage of the flexibilities and in some cases, very poor countries were even going beyond the IP rules of the TRIPS. In order to find an explanation for this puzzling finding, she looked at the process of TRIPS implementation as a competitive game with actors such as industry, NGOs, governments, IOs, each following their particular agenda.

The presentation put forward two explanations:

1) The first, linked to the understanding and global politics of the IP rules implementation, sees the TRIPS implementation shaped by the dynamics of debates on the TRIPS and international IP negotiations. The TRIPS provisions being very contested and sometimes said not to belong into the WTO framework (Bhagwati, Stiglitz), States from both the North and the South pushed to change the deal: for the North, IP protection standards were to be raised further, while the South wanted to lower them. As IP rules affect areas as diverse as consumers’ rights, public health, education or open-source software, public debate gained momentum.

2) The second explanation focuses on the interplay between international debates, external power pressures and the national process of IP-decision-making. Dr. Deere identified and explained sources of external pressure the strategies that these actors employed and the kinds of power they exerted.

Two currents of pressure distinguished themselves:

  1. one argued for a rapid and swift compliance with the core TRIPS rules everywhere, encouraging countries to go beyond TRIPS (TRIPS Plus). Media campaigns and attempts to shape the ideas of developing countries’ delegates on the meaning and the advantages of the TRIPS were the most current means of pressure. Within the WTO and the WIPO, a “culture of rapid compliance” with the TRIPS was mainstreamed. Meanwhile, as most capacity building assistance was offered by WIPO and developed countries, this was characterised by the promotion of reforms to comply with stricter standards, sometimes even discouraging the use of TRIPS flexibilities.
  2. the other current, represented by NGOs, IGOs, UN Agencies, academics and developing countries, argued for the use of flexibilities. They also resorted to means like media campaigns to raise the awareness about the advantages of the flexibilities mechanism. Also, a sort of “research war” started between the two currents as the result of retaliatory reports on both sides.

Finally, Dr. Deere shifs the focus out of global politics towards the national level and elaborates on domestic factors in developing countries, which either limited or amplified the actual influence of external pressures, thereby contributing to the variation in the TRIPS implementation.

  1. the bureaucratic capacities of developing countries with respect to IP implementation: the weaker these are, the more susceptible the country will be to absorb whatever ideal drives the technical assistance they receive (consider the actors providing TA: WIPO and developed countries). Further, IP Officers are usually more technocrats than public policy specialists, thereby influencing the decision making of a developing country without taking into account its public policy needs, especially in countries where the IP Office is relatively independent and where its decisions do not enter into a public debate mechanism.
  2. The coordination between the capitals and their missions to the WIPO and WTO: as it is the IP officers negotiating and not the trade officers, it is all the more important to ensure proper coordination between the mission and the capital.
  3. Public engagement: if the industry and elements of the civil society speak up either against or in favour of the use of flexibilities, in many parliaments, there is a lack of knowledge and interest in these issues. There is also no debate among local interest groups (there are, however, interest groups pushed by branches of international interest groups, like a Novartis local affiliation or a MSF or OXFAM local affiliation).

The conclusion draws out some lessons learnt from these findings that could advance a development agenda with regard to domestic IP reforms and the implementation of international IP agreements by developing countries.

Comments:

Mr. Boumedie Mahi, Permanent Mission of Algeria, following WIPO activities:

-He points out that only recently, WIPO secretariate started delivering TA regarding flexibilities to developing countries. Now, DCs have gained freedom to express themselves in favour of the use of flexibilities.

-the Development Agenda of WIPO has been one response to the issue of discussion. The aim is to have a balanced protection: to encourage innovators AND take into account development and access to items by the public. Then, he noted that capacity building for this objective was needed: the developed countries’ view of TA was biased towards helping implementing TRIPS. The Agenda emphasises the need to consider the balance, including the developmental dimension.

Mr. Christoph Spennemann, Legal expert, Intellectual Property Team, Policy Implementation Section, UNCTAD, Geneva:

He basically agrees with the presentation’s content. However, he pointed out one question:

Is there really a gap between the discourse of developing countries and the domestic implementation of the TRIPS?

-Observing, as Dr. Deere did, that there is a high level of IP protection in LDCs, while more flexibilities are used in DCs, Mr Spennemann sees the decisive criteria in that TRIPS flexibilities are difficult to implement. His example drawn from patent law: if not even developed countries are clear on the definition of “inventive step”, how should developing countries approach such issues.

-this domestic capacity to implement differs from country to country. He notes that a group of countries, that he chooses to call Group3 countries, has the highest IP standards but a very low technical capacity in IP. Advanced developing countries with higher technical capacity make, on the other hand, considerable use of flexibilities. These countries, like Brazil, India, Argentina or China, he notes, were also the ones that actively participated already in the Uruguay Round and are now aware of the implications of flexibilities.

In other words, Group3 members know about IP benefits but lack awareness on the IP impact on their public domain and the consequences on innovation. The widespread belief is that in IP protection linked to foreign investment but they ignore the importance of flexibilities to attract foreign generic producers of pharmaceuticals, for example. The result is that pre-TRIPS laws prevail due to the lack of capacity.

This very group does not participate in the debate between the two currents of pressure and in the insights regarding the use of flexibilities. This lack makes them open for any suggestion, which will usually come by in a race of the TA providers to win the game.

He concludes that domestic capacity to UNDERSTAND the implications of flexibilities is KEY. IP-related capacity building that takes account of development objectives is needed.

Mr. Ahmed Abdel Latif, Programme Manager for Intellectual Property, ICTSD, Geneva

He raises the question of legitimacy from the Southern point of view: for the South, he claims, it is important to know who is putting forward what idea and what suggestion. He proposes to incorporate this element into the game analysis of the presentation.



Noelia Díaz

UNCTAD - Globalization of port logistics: opportunities and challenges for developing countries, A pre-UNCTAD XII event

The purpose of the meeting is to examine the most suitable ways for developing countries to meet the challenges and opportunities that the globalization of logistics may pose to their national trade and investment policies, in the light of recent trends in international maritime transport and developments in sea, river and inland terminals.


World trade, development and logistics: an industry perspective

C.T. Burke, Senior Advisor, K Line America:

In Los Angeles, an environmental program was set up through the national ports.
Each developing countries need to have a national plan to improve all the dimensions level: employment, social, economy…
Three years ago, American ports discuss about a national security program to bring security in the ports.
Each port need to have an important security since 11/09 (the world have change…).
We need a central organization to answer to the security issue, unfortunately it’s an expensive issue, but it should be the United Nations Organization.
He finished his speech by “when it’s time it’s time” (in relation with security matter).

QUESTION:
- Suriname: How small countries could participate to the globalization in Logistic without important resources?
Not only could the big port manage to consolidate their infrastructures but also the small port if we work together through International Institution.



Port logistics: strategies for containerized trades

T.Morwe, Chief Executive, Durban Port:

There was a growth in container (Vessel call and Average Call Size) during the last seven years.
The main problem in South Africa for the Logistics is the distance. It exist a long distance from ports in South Africa.
In according to The World Bank report on Logistics, on 130 countries, South Africa is place to 24th rank concerning the Middle Income of his ports.

Ports in Developing Countries normally faced the following problem:
- capacity constraints
- skills shortage
- lack of modern technology
- low degrees of trade flows



John Verschelden, Vice President and Head of government and Regulatory Affairs, APM Terminals:

APM have this Head office in The Hague (Netherlands) and have many Regional Offices (31 countries whose China, EU, UE…).

A significant role on World Economy:
- Increasing distance between the areas of production and consumption
- World trade drives the global economy
- Container terminal play a key role in global supply chain

To resume, the idea is to go through reducing the costs to facilitate the global trade.
Market growth (dollars):
- 2000: 236 Millions
- 2006: 442 Millions
- 2011: 673 Millions

And also in regional trade:
- Africa: 9%
- Middle East:6%
- Asia and Oceania: 8%

In some area (for instance in the east of Australia), it exist or emerge bottleneck in container handling capacity.

Challenge for container terminal industry:
- getting capacity on line, when and where required
- long project cycles in developed markets
- increased complexity due to environmental constraints
- capacity landside connection
- lack of suitable deep water sites
- competition for experienced
- Plus backlogs in maintenance of acquired terminals

Plus in developing Countries:
- State of port infrastructures and services
- Privatization processes
- National property
- Quality and capacity of landside connection
- Proximity to urban areas
- Training of labors
- Political instability
- Customs procedures
- Poor safety culture
- Maintaining equipment
- Corruption

QUESTION:
African Union Commission: Only some big ports like Durban are effective. As the African countries will represent the most important business in the future, the UNCTAD help to our ports could profit to public and private participants.

M. Morwe: We knew the weakness and we improving the inter-connection between each ports in South Africa. Moreover, the key challenge is the transformation of the industry of Logistic.



Inland connections to global networks

A.Von Stempel, Director, Freshwater Logistics:

Ocean freight:
- inter-Asia: 44.3 M, TEU* (twenty-foot equivalent units) up 9.7%
- Asia/Europe: 17.8 M, TEU (twenty-foot equivalent units) up 13%


*= Container capacity

TEU growth:
- 2002: 2.96 M
- 2006: 3.1 M
- 2007: 3.7M

Concerning to the capacity of each port, we could see a saturation of some ports, and generally an increase of the volume in relation to the capacity.

Interland Strategy:

Strength of road: speed, flexibility, fixed pricing per unit.
Strength of rail: mass transportation capacity, fixed schedules and pricing.
Strength of barge: environmental friendly, mass transportation capacity, fixed but flexible schedules.

Many weaknesses with rail: congestion issue, delay vessels and trains, train could be longer but there is platform length limitation, space shortage in train, lack of parking at gate…

Role of International Institutions:
- financing renovation of essential infrastructures
- encouraging customs and administrative procedures simplification
- ensuring fair competition


Information:

Document: http://www.unctad.org/en/docs/tdxiibpd3_en.pdf

Publication Review of Maritime Transport: http://www.unctad.org/rmt2007





Damien AFONSO