Multilateral institutions need reform

The multilateral institutions and development banks need to reform.

Dinesh Bhattarai, Permanent Representative and ambassador of Nepal in Geneva, speaking on behalf of the least developed countries (LDCs), today said the opening session of the weeklong Trade and Development Commission, "the current economic and financial crisis has exposed the limitations and weaknesses of the international financial institutions, and necessitated the deep reform of multilateral institutions and development banks."

He also called for greater emphasis on agricultural development, infrastructure development, poverty reduction, and steps to ensure food and energy security in the globe's poorest countries.

'Business as usual is not an option' as a fragile recovery in the world economy takes hold, UNCTAD's secretary general said addressing on the occasion.

Secretary general Supachai Panitchpakdi said that "moving out of a crisis of such magnitude offers a rare historical chance for change, a momentum for reform. New development paths" are needed based on diversifying developing countries economies, on 'a pragmatic balance' between the roles of the market and government policies, and on "reorienting international trade, financial, and monetary cooperation towards more equitable, sustainable, and coherent global governance systems."

Recovery cannot depend solely on climbing demand in industrialised nations for foreign goods, Supachai told the meeting. Developing countries should look increasingly to 'South-South' trade -- that is, to one another - for market opportunities. "This is not unrealistic, given that many developing countries have performed relatively better and survived the crisis with less damage than in previous recessions," he said.

The secretary general similarly called for "integrating the Southern perspective more explicitly" into reforms to the global financial and other governance systems being considered by the Group of 20 industrialised and developing nations. And he stressed an UNCTAD message of recent years: that improving the "productive capacities" of developing countries -- that is, their abilities to produce goods and services of greater sophistication, and in greater variety -- is vital for making stable economic progress, creating jobs, and raising living standards.

Supachai noted that global trade contracted by about 12 per cent last year, and that global unemployment, according to the International Labour Office (ILO), exceeded 200 million.

Rodolfo Reyes, Ambassador of Cuba to the United Nations Office and Other International Organisations at Geneva, speaking on behalf of the Group of 77 and China, told the meeting that "Globalisation and liberalisation without adequate and effective regulation at the national and international levels, and without attention to development concerns, can lead to detrimental effects on the financial and real economies, as well as on peoples' lives and the environment."

A representative of Egypt, speaking on behalf of the African Group of countries, urged "greater emphasis on the need for boosting the economic diversification of developing countries and the enhancement of their services and industrial sectors."

The Commission, which continues through May 7, went on in its afternoon session to explore the theme of recovery and change in a debate on "successful trade and development strategies for mitigating the impact of the global economic and financial crisis."

Later in the week, the Commission will review the outcomes of UNCTAD expert meetings held on such topics as commodities and development; services and trade; South-South cooperation; transport and trade facilitation; competitive law and policy; 'green' and rural energy technologies; and productive capacity-building.