lundi 17 décembre 2007

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

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