15 April 2003

Secretary-General Says UN Natural Home for Needed Dialogue Among Trade, Development Institutions, in Statement to High-Level ECOSOC Meeting

NEW YORK, 14 April (UN Headquarters) -- Following is the statement of Secretary-General Kofi Annan, delivered on his behalf by Deputy Secretary-General Louise Fréchette, to the special high-level meeting of the Economic and Social Council (ECOSOC) with the Bretton Woods institutions and the World Trade Organization in New York on 14 April:

It gives me great pleasure to welcome you all to the United Nations.

Over the past several years, this annual discussion between ECOSOC and the Bretton Woods Institutions has contributed to a large degree of convergence in our thinking -- both about the problems we face, and about the solutions we must put in place. There has also been greater appreciation -- long overdue -- of each other's strengths and expertise. This gathering sense of common purpose bodes well for the challenges ahead.

Today, building on the fruits of our past discussions and joint efforts, we set off in a new direction. A little over a year ago, at the International Conference on Financing for Development, world leaders gave this meeting a precise task: to take stock of how we are implementing the Monterrey Consensus.

The formal focus of this discussion is "policy coherence": that is, how governments, institutions and non-governmental participants can best pull together the many distinct strands of economic policy into a clear framework for action that promotes development; and how they can work together -- not against each other -- in fulfilling the commitments made in Monterrey. To cite just one example of what we must rise above: it makes little sense for a government to help dairy farmers in a developing country if, at the same time, that same government is exporting subsidized milk powder to that same country.

I am sure your discussion will cover a lot of ground -- domestic and international enabling environments, trade and investment policy, debt relief and official development assistance, domestic and global economic governance. This agenda may sound somewhat dry or abstract, except to economists. But, in fact, it has a direct impact on human welfare.

Will fiscal targets prevent countries ravaged by HIV/AIDS from spending more money on treatment?

Will we reach the Millennium Development Goals -- reducing hunger, halting the spread of epidemics, providing universal primary education, and so on -- if the Monterrey financial commitments are not met?

Will the Doha negotiations truly offer new trading opportunities to the poor, or will we continue to see commitments to open global markets undermined by subsidies, tariffs and other barriers?

Will the demands for strengthened governance at domestic level be matched by reforms at global level that offer the people of developing countries a greater voice in decisions affecting their lives?

Are donors understating the debt problem by overstating likely commodity price levels? Are we encouraging private capital flows without taking measures to make them more stable? Will we finally harmonize development assistance procedures? Will we continue to treat labour flows differently from capital flows, encouraging the latter but restricting the former?

These are just some of the questions of coherence that face the international community. As you will recognize, they flow out of the Monterrey Consensus. But today's session must not confine itself to further hand-wringing and diagnosis; we know the issues. Today we must try to determine how best to address them. To assist you in this process, the Secretariat, in cooperation with the staffs of the other major institutional stakeholders, has prepared a note for this meeting that tries to stimulate and focus your discussion.

My remarks today would be incomplete without a reference to the difficult international environment in which we are meeting. There are serious concerns about the economic impact of the conflict in Iraq, particularly on developing countries. The world economy continues to recover weakly from the slowdown of 2001, its largest setback in a decade. Unemployment has risen significantly around the world. Households and entrepreneurs almost everywhere are concerned about their future and hesitant to make long-term decisions. We must all do our part to rebuild global confidence.

The new round of trade negotiations launched in Doha is one of the most pressing current tests. But this opportunity is in jeopardy of being squandered. In two areas that are central to the hopes of the poor for a better future -- public health and agriculture -- governments have failed to meet their Doha deadlines. The area of agriculture is especially critical, not only because it is central to the success of the Doha negotiations themselves, but also because it is a litmus test of the coherence of developed countries' development policies.

For many years now, developing countries have been encouraged to eliminate subsidies as a basic step in getting their fiscal houses in order, which, in turn, would help create the necessary conditions for growth. Yet, the developed countries persist with agricultural subsidies and tariffs of their own against the exports of developing countries, offsetting or even undoing the benefits of other forms of cooperation with those same countries. I urge developed countries to dramatically reduce agricultural subsidies, without delay. This would help the world economy. It would remove domestic and international trade distortions.

And it would provide a much-needed boost to the Doha negotiations, signaling to developing countries that they can still hope for the development round they were promised.

That brings me back to the nature of this meeting. In Monterrey, heads of State and government and senior officials pledged to "stay engaged" and to use the United Nations as a forum for dialogue. Indeed, the Monterrey Consensus identified a major gap in global governance: there was no convenient way for the key specialized multilateral institutions in the fields of monetary, financial, trade and development issues to come together and explore ways to work with each other and reinforce each other's actions. The United Nations is the natural home for that discussion, and this meeting is an attempt to provide precisely such an opportunity.

So, I very much look forward to this dialogue. At the same time, let us bear in mind that it was the intention of the Monterrey Consensus to give new effectiveness to this meeting. That is why our note asks you to consider how the meeting and its preparatory process might be further developed for next year.

The Secretariat and I, personally, are strongly committed to helping you shape an effective multilateral process -- open, inclusive and responsive -- that will help the world achieve its development goals.

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