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Proceedings of the AFRICA CIVIL SOCIETY SEMINAR ON FINANCE FOR DEVELOPMENT January 7-10, 2002 MS-TCDC Arusha, Tanzania Organized by IBIS-Denmark, UNA-Denmark, MS-Denmark and Kulu Women and Development The Africa Civil Society Seminar on Finance and Development in Arusha, Tanzania convened from January 7-10, 2002 and was attended by representatives from various NGOs working on trade, development, gender and pastoralism and a representative from the World Bank. Morten Emil Hansen, who made the opening remarks, underlined the importance of the seminar in generating recommendations that would be fed into the Financing for Development process. He then proceeded to present a background of the organizations behind the seminar including IBIS-Denmark, UNA-Denmark, Kulu, and the development organization MS. A brief introduction of participants present then followed. Following the opening remarks, two presentations were made on day one of the seminar, followed by comments and questions from the participants. In the afternoon session, participants were involved in group discussions followed by a presentation to plenary. The presentations made on day one were the following: a. “What is Financing for Development, and will it be more than words?” byMr. Mikael Bjerrum, UNA-Denmark; b. “What is a Global Deal, and has it got a
future?” By Mr. Morten
Emil Hansen, IBIS-Denmark. 1. What is “Financing for Development”,
and will it be more than words? In September 2002, The Millennium Summit of World leaders in New York declared to half the global poverty by the year 2015. In order to secure this goal, the idea of Finance for Development Conference was conceptualized. This conference, which takes place in Mexico in March 2002, suggests adopting a holistic approach incorporating such diverse areas of policy as debt, trade, development aid, private investments, human rights and the environment. Thus, where previous UN conferences focused on single topics (women, the environment, population increase, children etc.), “Financing for Development” will attempt an overall approach. This is emphasized by the fact that the conference is in collaboration with the UN, The World Bank, The International Monetary Fund and the World Trade Organization. The holistic approach adopted by the FfD conference will address six themes including,
It is hoped that, for the poor countries, good governance, debt relief, official development aid and – not least increased market access for their products will be essential measures in breaking their stranglehold from poverty. The Zedillo report available on: www.un.org/reports/financing provides a more in-depth coverage on issues relating to Financing for Development. Following the brief presentation by Mikael Bjerrum, the floor was opened for comments and questions from participants. QuestionØ In recent times we have witnessed the powers of the UN eroded, but at the same time seen the increase in power of the Bretton Woods institutions and the WTO. Under this circumstances, how can the UN be the leader in developments issues, what do we need to restore the power of the UN? AnswerØ It is not entirely true that the UN is powerless. The UN has at its disposal sanction power, which it can use. For instance, after the September 11 terrorist attack on the US, the UN Security Council demanded that every nation adjust its national policy in-order to fight terrorism and if not invite UN sanctions. We have also seen the US press sanctions against Iraq and the apartheid regime in South Africa. CommentsØ The fear that the UN is slowly loosing its power is genuine. For example since 1999 we have seen the UNDP being led by a director who formally worked for the World Bank. This happened amid protests from various groups that the UN was losing its independence and powers to the WTO, IMF and the World Bank. What we are concerned about is, that the FfD should strengthen the UN to be the global leader in human development issues. Ø We in the civil society are also concerned about the issue of governance of the UN. The UN Security Council for example continues to be dominated by the victors of the Second World War. There have been contradictions in the application of sanctions of member countries. For example, why is it that the UN quickly uses its power of sanctions when certain countries in the North are affected while when crisis and war erupts in Africa we only notice lukewarm reaction? These are some of the contradictions that FfD should address. Again, on the WTO we see that the membership of countries in the South is only cosmetic. How can we explain the position that our products cannot access markets in the West? We need to reexamine the rules governing import and exports. Ø On the concern for global governance, we need to establish what should be the role of WTO, the World bank and the IMF. Some of the development paradigms decided by these institutions have been a complete failure. They have talked of privatisation, liberalisation, divestiture etc. but all these have been a failure. The worst thing is that in their measurement of good governance these institutions will look at efficiency, how well were the loans used? How well have the policies been implemented? But they do not care what these policies do the people and especially the poor and vulnerable! Ø The World Bank is a bank like any other bank. But a bank cannot be wholly involved in development work. Therefore, the World bank should leave the UNDP and other agencies involved in development and humanitarian work to do the job. Though the IBRD loans are 100% risk free, they need to ensure that the loans are sustainable and that they are used for the purpose for which they were meant,##### QuestionØ We have seen official development assistance reduce, should countries go for loans or should they be entitled to grants where ODA is not forthcoming? AnswerØ It is important that the principles of equity, justice and human rights are addressed. For countries fighting natural disaster such HIV/AIDS, famine and pestilence, it would be grossly unfair for the same countries to take loans to bridges the gap.|||||| ODA should be automatic and the UN should have sanction on countries not remitting their quotas. For example the US has not remitted its quotas for close to there years now! QuestionØ Should ODA be pegged to good governance? Is it possible that donor countries should place conditionalities on regimes that are oppressive and dictatorial? AnswersØ Two proposals can be put forward to address this issue. One, where a regime is out-rightly dictatorial, assistance should be cut automatically, and this should only be reinstated when proper structures for democratic governance are instituted. On the other hand, it can be argued that it is the people who suffer when official development assistance is cut and therefore, a gradual process of engagement with the autocratic regimes should be pursued. Ø Another issue that could be raised is that bilateral funding has actually not come to tangibles. We have noticed that the support we get goes more to service delivery and not to productive areas. ODA will therefore be channeled to capacity development and advocacy. CommentsØ In Doha we had the slogan from rich countries and TNCs that is was meant to be development round. But they did not mean it. TNCs were eager to see TRIPS and the new issues on investments, government procurement and competition brought on board. In relation to global governance, it would be desirable that the activities of TNcs are controlled. These produce certain products that are harmful, they engage in unethical human trials, produce sub-standard goods. Since TNCs are the greatest funders of research, they have produced drugs that cannot be afforded by the poor, especially for such debilitating diseases as HIV/AIDS. The following issues of concern need to be addressed in relation to TNCs: -Ethics and dignity of human beings; -Benefit sharing in cases where human trials are involved; -The extent of environmental degredation by TNCs; -Extent of violation of human rights, workers rights; -Lowering of the cost of drugs for HIV/AIDS and -Standard of products/goods produced especially in developing countries. Ø There have been efforts to incorporate the issue of TNCs in FfD. For example, in 1999 the UN Secretary General Koffie Annan launched the Global Compact. This was an agreement between the UN and private companies where private companies promised to look at nine principles taken from: Human rights declaration, environmental issues and workers rights. The ultimate objective of this was to create better ethics within thee private sector.
2. What is the Global Deal, and has it got a future? Morten Emil HansenThe concept of the Global Deal has been launched by the Danish Government with an aim to strike a grand deal with the poorest development countries. This concept has also become the main objective for the Danish Government in the Finance for Development and the RIO+10 processes. Based on the quid-pro-quo principle, the Global Deal, now supported by both the EU and the Nordic countries, will extend a number of special advantages to development countries. A global Deal implies that the North and the South will be willing to give and take for the benefit of all. Commitments from the NorthA Global Deal could include the following commitments from rich countries: § To give more and better ODA; § Debt cancellation; § Free market access; § A global tax for sustainable development. Commitments from the SouthDeveloping countries on the other hand would commit themselves to: § Prioritize sustainable development; § A comprehensive plan for poverty reduction; § Health; § Education; § Good governance; § Environmental preservation. The three C’sA Global Deal must be built on the three C’s; Comprehensiveness, Coherence and Commonness and additionally and very important civil society. Comprehensiveness and coherence are absolutely necessary in order to bind all elements including ODA, trade, debt, global tax and the environment. Important ConditionsCommitments from the North and the South must naturally be developed with the strong participation of all relevant stakeholders. All commitments must be based on minimum standards and binding global agreements coupled with sanctions. Indeed, in concluding a Global Deal, the Developed countries should agree to promote decoupling of economic growth and environmental degradation in order to demonstrate their commitment to global sustainable development. A Global Deal should explicitly state that all countries reaffirm their adherence to the RIO Declaration. It should also build upon the development targets for poverty reduction included in the UN Millennium Declaration. OpportunitiesA Global Deal will be the sum total of the challenges and results derived from the international negotiations in the WTO, RIO+10, World Bank/IMF and Finance for Development. By focusing on comprehensiveness, coherence and commonness, we may have a better chance of making finance work for development of the poorest. Dangers§ Due to the divergence of opinion on poverty goals among the civil society, it may not be easy to reach consensus; § There is the danger that the Global Deal may become a rubber stamp on unjust policies; § Non-fulfillment of expectations may create frustrations at times; § We also lack alternative economic development models; § The Global Deal could also create more conditionalaties. Challenges§ How can we promote the concept of a global deal in the Finance for Development process? § How can we build constructive alliances among countries towards the RIO+10 conference in September? Following the presentation by Morten Emil Hansen, the floor was opened for questions and comments from participants. QuestionsØ The concept of the Global Deal is not yet clear, how is it different from other agreements such as the ACP/EU agreements? Will it involve setting up another secretariat? Ø There have been various efforts from the North to address our problems like the FfD, PRSP, some of which have been made in good faith. But also need to establish what should be the solution, maybe we need to know what we want before we make fresh commitments. AnswersØ The idea of a Global Deal is just a suggestion, which will be incorporated into the RIO+10 discussions. There are no clear cut lines placed and the Danish Government has only come up with some suggestions contained in the Danish Non Paper[1]. The whole idea behind this is to come up with an overall agreement in which all other agreements will be ###fitted into. Ø The Global Deal is a bit different from other agreements. It is a way of being pragmatic by getting sustainable development on the agenda. The suggestion by the Danish Government and the EU is a trial to break the ice. If it works then it will be the Global Deal. These suggestions introduce a comprehensive process, which will not be restrictive. It will go beyond organizations and international conferences. CommentsØ However nice the name Global Deal sounds it may not be so important since the issue is to look at the role and influence of the Bretton Woods institutions. The IMF and the World Bank do not help at all, but they design programs without consultation and then impose these of us. I think the Global Deal should critically address the question of Finance for Development. Ø We are all wary about all these new names: Millennium Summit, Global Deal, Global Compact, etc. What we are curious to know is if there are loopholes in the Millennium declaration or the Compact that have necessitated the Global Deal. Perhaps we need to look at the content of these deals and see whether they house the main issues raised under the FfD. We need to incorporate the views of the poor in this process. Ø Concerning the issue of global governance we need to establish who is policing who? The IMF and the World Bank have become small gods, they are too powerful. We know the WTO is about trade and the IMF and World Bank are bankers, but who is to tell them that their policies are not working? The gaps between the poor and the rich have widened. We then ask, what will be the status of the FfD? Will it be binding on countries? But then the FfD should be one way of bridging the gap between the haves and have-nots. Ø On the final declaration from Mexico, will it be just like other conferences where we make commitments and then go home or shall we make an agreement accompanied with sanctions? Will it be another endorsement of global PRSP, Privatization, Liberalization and Globalization? Perhaps we can make the following suggestions, that: -We need to state positions regarding the restructuring of the present trade regime, which is repressive; -We also need to depict the IMF and the World Bank in their true colours as true chameleons; Group WorkDuring the group work session, the participants discussed the following question: 1. What should be the main issues to be addressed in the Finance for Development Conference and the Global Deal? PlenaryDuring the plenary, the following recommendations were made: On FDI§ The FfD conference should address issues concerning FDI by: -Revisiting the argument that FDI leads to economic growth therefore automatically leading to poverty reduction; -That FDI to some extent can contribute to development in the context of accountable, transparent and democratic governance/environment. § FfD should consider the issue of reviving the UNTC (disbanded in 1993) in order to safeguard developing countries and other member states from unjust trade practices, protect indigenous wealth, intellectual property rights, environmental protection and human rights abuse; § That a global tax system be established targeting TNCs and speculative investments, monies which should be in invested in social services; On Global Governance Issues§ The FfD process should go beyond the themes of different conferences in the past and adopt a holistic approach that embraces the global vision as envisaged in the Global Deal; § The FfD should also focus on governance and political issues as they affect development; § Countries in the South need to take advantage of their numbers and build a common ground for negotiations; § The FfD conference should address issues of UN reform as an integral part of the development process by securing a just and germine global representation in the Security Council; § The UN should be strengthened and revitalized to be the highest decision making organ in matters relating to human development; § That the UN should be given powers for enforcing sanctions and commitments made by rich countries to poor countries; § All UN specialized agencies must enjoy equal status and treatment and that the IMF and World Bank must not enjoy special/superior status and power; § That the World Bank and the IMF should get out of development matters and concentrate on issues of banking leaving the UN to deal with human development issues; § We need to reexamine the Neo-Liberal development paradigm as this has failed completely to bring the desired result of poverty reduction; Other RecommendationsIn addition, the following concepts were identified as needing global definition: Democracy: We need to define basic indicators of democracy such as voice, stake, human and social aspects, affirmative action and documentation; Sovereignty: In the light of economic dependency and non-legitimate states and global governance; Representativity: Voice, stake, structures for consultations etc. Women and youth participation Governance: Cohesion in development. The state governance should be developed and well defined; Development paradigms: We need to reevaluate the appropriateness of the current Neo-Liberal development paradigm based on the Washington Consensus; Conditionalaties: We may need to have a global, common checklist for these. Day 2; January 8, 2001During the sessions of the second day of the seminar, an open discussion was held on the debt issue and one presentation was made on the PRS process: a. “The Debt Issue: Causes and Implication of Debt in different Countries”, an open discussion; b. “A World Bank Perspective on the PRSP Process”, by Dr. Ben Tarimo, World Bank Country Office, Tanzania. 3. The Debt Issue: Causes and Implication of Debt in different Countries This brainstorming and intensive session was organized with each participant being invited to make their intervention on the causes and implications of debt to poor countries. The following guiding headings were used in the discussion: a. Conditonalities and debt; b. Privatization; c. Governance, control and supervision; d. Human development vis-à-vis economic development; e. Corruption; f. World Bank’s role as coordinator of ODA. The main discussant during this session was Dr Ben Tarimo, Consultant to the World Bank. CommentsØ As we address the issues of debt relief, the subject of corruption has to be dealt with first. It is true that the HIPC initiative has produced positive impact in some sectors with the bulk of the monies going towards universal primary education and health. But, we have also received many complaints about the usage of these monies. For example in Uganda, many of the pit latrines constructed for schools using the debt relief money are already collapsing. Equally, we have received many complaints regarding textbook procurement and school buildings with visible cracks almost immediately after construction. Therefore, there is a need to empower the civil society to have a supervisory role on how funds for debt relief are used. Ø Uganda is currently appraising its poverty reduction strategy and in the process of qualifying for HIPC 2. But to qualify for this Uganda has to pass the corruption act. This conditionality by the World Bank is therefore desirable to ensure that monies for debt relief are used appropriately. QuestionsØ We need to challenge the commonly held assumption that debt relief creates growth and that growth leads to reduction of poverty. Uganda for example, has a poverty of 35% but when you go to the ground, you realize that this figure is not accurate. Indeed, the situation ahs actually gone from worse to the worst even with debt relief. The questions we therefore ask are: -How do we calculate the sustainability of debt? -Is the HIPC sustainable, what are the tangible results? AnswersØ It is true that growth has not contributed to poverty reduction. This is an issue that is of great concern to the World Bank and the bank is working on a Comprehensive Development Framework to address this subject. But even as we talk poverty levels have actually not gone down, but it is the income gaps that have increased with the rich getting richer and poor remaining where they were. Ø In calculating debt sustainability we at the World Bank us certain ratios such as the debt service to exports ratio, debt to GDP ratio and debt to revenue collection ratio. The HIPC initiative aims to reduce the debt levels to sustainable levels. This is a comfortable level where a country does not feel pain repaying its debts. Ø It is pleasing to note that of the four countries that have attained the HIPC completion point, three of these are represented in this forum mainly, Uganda, Mozambique and Tanzania. But it would be too early to start evaluating the impact of the HIPC initiative give that some countries like Tanzania attained their completion point one month ago. We need to give this a longer period of say two to three years. But we may note that with the debt relief Tanzania has recorded a modest 3% growth rate in GDP while Uganda has recorded a growth rate of greater than 6%. CommentsØ Is it possible that the growth rates by Tanzania, Uganda and Mozambique are just cosmetic? Why then do we see so much poverty and destitution around us? How would you relate debt forgiveness and standards of living? On the other hand if your debts are forgiven you may be black listed and be regarded as uncreditworthy! For example Japan stopped giving loans to Ghana when it joined HIPC. Ø We disagree totally that the poverty situation has improved. This is totally erroneous. The frameworks developed by the World Bank and the IMF have been disastrous. These top-down programs have led our people to the destitution. They have meant, withdrawal of subsidies, introduction of user fees in hospitals and schools, retrenchment of workers and in the education sector; schooling has become a preserve of the rich. Our people are simply living in abject poverty. QuestionsØ For a long time the World Bank had been parading certain countries such as Kenya, Ghana and Ivory Coast as stars of the World Bank frameworks. How then can these same countries fall to HIPC? Could it be that these frameworks are erroneous? Ø The World Bank frameworks have not ensured that structures for production are maintained. Instead, we have witnessed a situation where debt relief money is used to import things. For example, in Ghana the Public Enterprises (PES) were sold off at ridiculous prices-like the Ashanti Gold Mines-and no one knows what the money was used to do! The late Mwalimu Julius Nyerere was right in asserting that privatization is “total theft” Could it be that the World Bank is working with Member countries to buy indigenous PES cheaply? Ø We have moved from poverty elimination to poverty alleviation and now we are in poverty reduction, is this sustainable? AnswerØ The World Bank is not involved in sale of PES. The respective governments do Selling of parastals. It is the government’s duty to announce the sale of PES and invite quotations. Again, governments should be small; they should be involved in those areas where they have comparative advantage such as defense, law and order and big infrastructure projects (high externalities) such as airports, roads and dams. Ø The concept of poverty elimination is mistaken since poverty is not something we can eliminate totally. That is why there is a build up towards poverty reduction since poverty levels can only be decreased and not eliminated. CommentsØ How about absolute poverty, but this can be eliminated. Ø The main objective of these conditionalities on deregulation, privatization and liberalization is to weaken our states. Look at Uganda, 50% of its GDP comes from foreigners, can we really say Uganda is sovereign? Why is it that in Africa the Bretton Woods institutions insist on these conditionalities while in the West we see strong states that provide social security to their citizens! 4. A World Bank Perspective on the PRSP Process, by Dr Ben Tarimo, Consultant the World Bank[2].I. IntroductionThe International Bank for Reconstruction and Development (IBRD) better known as the World Bank was established in 1944 with the initial task of helping Europe recover from the devastation of the Second World War. The bank later turned its attention to the developing countries. As the 1950s progressed, it became clear that the poorest developing countries could not afford to borrow needed capital for development on the terms of the bank and hence the International Development Association (IDA) was created in 1960. The bank’s main focus has been on development finance for growth and poverty reduction. Over the years the World Bank has had many innovative approaches to address the issues of growth and poverty reduction. For instance, whereas it was considered appropriate in the 1960s and 1970s to follow a project-by-project approach supplemented by structural policy reforms, later after some critical evaluation, it became clear that a more holistic approach to development was necessary-hence, the Comprehensive Development Framework (CDF). More recently, with the growing external debt problem in LDCs, the bank and the Fund have developed the debt relief mechanism under the concept of HIPC initiative. The main focus of this was to increase expenditures for poverty reduction. In addition, the Bank has designed special tailored schemes to deal with the unique situation, which the African continent was facing. In this connection, the PRSPs have been developed, albeit they are open to all HIPCs. PRSPs are fully country owned processes and have been developed in a very inclusive and participatory manner. II. World Bank’s Special Focus on LDCs-the IDAThe IDA is the World Bank’s concessional lending window. It provides long-term loans at zero interest to the poorest of the developing countries. IDA helps build the human capital, policies, institutions and physical infrastructure that these countries urgently need to achieve faster and environmentally sustainable growth. A country must be a member of the IBRD before it joins IDA. Currently there are 162 countries, which are IDA members. At present, IDA lends to countries that have a per capita income in 2000 of less than USD 885 and therefore only 79 countries are eligible to borrow from IDA. It is a hope and expectation that IDA eligibility is a transitional arrangement, allowing the poorest access to substantial resources before they can obtain, from the markets, the financing they need in order to invest. As their economies grow, countries ‘graduate’ from eligibility. The repayments (or reflows) they make on their loans then help finance new IDA loans to the remaining poor countries. III. The Bank’s Approaches to DevelopmentFor many years many countries in the world have developed their homegrown initiatives to fight against poverty. In many of these countries, the main problem in implementing these strategies have been lack of resources arising, in part, from inappropriate macroeconomic policies. It was partly due this dilemma that it became imperative to link debt relief to poverty reduction. This process will release some resources specifically geared towards poverty reduction. In addition to this linkage, there is recognition that a comprehensive approach in terms of looking at the issue in a holistic manner will effectively tackle the problem. The World Bank has therefore advanced the CDF methodology as a mechanism for a more inclusive approach. The PRSP processes, which are bottom-up, locally owned, inclusive and developed in a participatory manner are in line with the CDF philosophy. In addition, the HIPC process has been the newest approach in addressing the development problem. This initiative is the first international response to provide comprehensive debt relief to the world’s poorest, most heavily indebted countries. Launched in 1996, the initiative broke new ground by moving beyond cash-flow relief and introducing debt sustainability as a key objective. By removing the debt overhang for countries pursuing economic and social reform, the HIPC initiative aimed to generate resources targeted at measurable poverty reduction, reducing multilateral debt and helping countries exit from endless debt restructuring. Despite steady progress, by late 1998, a consensus emerged for a major expansion of the HIPC initiative. Toward that end, the Bank and IMF led a global consultative review with NGOs, churches and a wide spectrum of civil society. As a result of this extraordinary process, the international community endorsed three key enhancements: § Deeper and broader debt relief; § Faster debt relief; § Stronger link between debt relief and poverty reduction. Impact of the HIPC Initiative§ Slashes in debt stocks: -Two-thirds cuts in total external debt; -Debt in relation to GDP is cut in half. § Lowers Debt Service: -Overall one-third cuts in debt service requirements; -Ratio of debt service-to-exports is halved; -Debt service as a percentage of GDP is reduced. § Boosts Social Spending: -Social expenditures projected to increase by an average of US$ 1.7 billion per year immediately after HIPC relief, -Increases in education and health spending to absorb about two-thirds of the total relief. IV. The Bank’s Special Focus on AfricaThe World Bank and IMF’s commitment to Africa was clearly outlined in the statement made by these institutions to the UN Economic and Social Council in Geneva in July 2001 (F&D, Sept, 2001). Indeed, success in the fight against poverty will be the key to stability and peace in the 21st Century-and no where are the battle lines clearer than in Africa. That notwithstanding, today will are presented with a window of opportunity-African leaders have been working together to accelerate economic growth and development and lead the continent out of poverty. This is anchored in the fundamental principles of African ownership, leadership and accountability in eliminating the homegrown obstacles to sustained growth. In this regard, the following are recognized to be key: § A clear awareness that peace, democracy and good governance are preconditions for reducing poverty; § Action plans to develop health care and education systems, infrastructure and agriculture; § Reliance on private sector and on economic integration at the regional and global levels; § More productive partnerships between multilateral and private sector development partners. In this connection, it is important to stress that the PRSP process-with its emphasis on country ownership, broad participation and economic and social fundamentals, is a core vehicle for building continent-wide priorities into national poverty reduction programs and for coordinating international support. ChallengesThe principal challenge in the coming years is to ensure that recent gains in growth are sustained and shared more widely among and within African countries. Africa has a challenge today to achieve sustainable growth of over 7 percent and make sure that growth reaches the poorest. This will require decisive action in four main areas: § Improving governance and managing conflicts; § Investment in people; § Increasing competitiveness and diversifying economies, and § Reducing aid dependence and improving partnerships. V. Looking Ahead and the Areas to Focus on in Future in the PRSP ProcessesRegarding the linking of the PRSP processes to debt relief, there are a number of aspects, which the implementing countries will have to take into account if the operation is to be a success. One area is the fact that debt relief is no panacea to poverty reduction. The second area is to make sure that the priorities identified in the PRSP are as realistic as possible. Lastly, it will be important to ensure that the increased pro-poor spending is delivering the expected services in an efficient manner as possible and that the effect is being felt by society. Following the presentation by Dr. Ben Tarimo, the floor was opened for comments and questions from participants. Day 3; January 9, 2002The third day of the seminar was devoted to developing recommendations to be fed into the FfD process, based on the following themes:
Participants were divided into three groups with each group discussing each of the above thematic areas. During the plenary session each group presented its recommendations and suggestions on the way forward in regard to the above issues. The final product of these discussions formed the blueprint of recommendations on the FfD process. PlenaryThe following recommendations came out of the group discussions: 1. Systemic IssuesThe UN § The UN must be strengthened to play the leading role in all human development issues; § That such institutions as the World Bank, the IMF and the WTO should operate as specialized agencies under the auspices of the UN; § That UNCTAD should play a lead role in providing guiding principles on FDI to in order to ensure that FDI is equitable and beneficial to host countries and protective to the environment. UNCTAD must also create a mechanism to control and regulate the activities of TNCs. § That the UN Security Council must be reformed to ensure global representation in order to reflect a democratic and equitable UN. The World Bank§ The World Bank must lend responsibly, ensuring that funds go to productive sectors in accordance to poverty reduction priorities. The IMF§ That the IMF should only play an advisory role and should have no power to enforce conditionalities on developing countries. The WTO§ The WTO should concentrate on trade aspects only and stay away from non- trade issues such as investments and TRIPs; § That the capacity of all member countries should be strengthened to enable them participate in all meetings and decisions of the WTO; § That developing countries must be allowed to introduce protection in sectors sensitive to their survival in the global economy. 2. Debt§ That future loans to developing countries must go through a transparent and participatory process and geared towards productivity for sustainable development; § Debt payment must not compromise the fulfillment of millennium goals; § There must be established a mechanism to ensure transparency in disbursement and expenditure of debt relief money and it must also be targeted towards poverty eradication and human development; § There must be no conditions attached to debt relief except that monies from debt relief must be used for social/human development. 3. Trade§ We demand that fair and equitable trade practices and principles must be observed in international trade; § We demand that developing countries be granted the right ot protect their nascent industries; § LDCs must also be accorded market access to developed countries markets: 4. ODA§ We have to enforce the commitment of 0.7% ODA from rich countries; § ODA must not have conditions of delivery of goods and services from donor countries; § Donor countries should increase the proportion of ODA that is channeled through multilateral agencies such as the UN; § All ODA must be aimed at poverty reduction and promotion of sustainable development: 5. FDI§ FDI must not be promoted as the panacea for poverty reduction; § UNCTAD must take responsibility for providing global guiding principles on FDI to make it equitable, gender sensitive, environmentally protective and respecting to human rights and ILO conventions; § In order to ensure sustainable development, FDI must be geared towards providing the use of local resources, transfer of capital, knowledge and technology, promotion of employment, community development and re-investment of revenues earned. Day 4; January 10, 2002During the forth day of the seminar participants took time off to visit the Mount Kilimanjaro area and Moshi town. [1] See appendix [2] The full paper by Dr Tarimo can be available on request: meh@ibis.org |
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