TWN Info Service on WTO and Trade Issues (Apr07/15)

30 April 2007

UNCTAD Board decides on Eminent Persons' reform proposals

UNCTAD's Trade and Development Board (TDB) has endorsed eight recommendations from the Report of the Panel of Eminent Persons set up by Secretary-General Supachai Panitchpakdi to propose ways to enhance the organisation's development role and impact.

However, another six recommendations will not be pursued while discussions on another seven outstanding proposals will continue.

Below is a report on the TDB decision, made at its executive session on 18-20 April.

It was published in the SUNS on 24 April.

With best wishes
Martin Khor

UNCTAD Board decides on Eminent Persons' reform proposals

By Riaz K Tayob (TWN), Geneva, 23 April 2007

UNCTAD's Trade and Development Board (TDB) has endorsed eight recommendations from the Report of the Panel of Eminent Persons set up by Secretary-General Supachai Panitchpakdi to propose ways to enhance the organisation's development role and impact.

However, another six recommendations of the Eminent Persons Report (EPR) on "Enhancing the Development Role and Impact of UNCTAD" will not be pursued while discussions on another seven outstanding proposals will continue at the TDB and at UNCTAD-XII, which is to be held from 20-25 April 2008 in Accra, Ghana.

These decisions were taken at the TDB's 41st executive session that met on 18-20 April.

During the discussion on the Eminent Persons Report, many developing countries emphasised the need for the Secretary-General to consult member states beforehand and regularly report to them on the implementation of the recommendations. They also stressed that implementation should be in accordance with UNCTAD's mandate and role.

Ambassador Burhan Gafoor of Singapore had chaired the informal consultations on how the TDB should follow up on the EPR, based on terms of reference drafted by the TDB's extended Bureau.

The result of the consultations were presented on 19 April in a draft Agreed Outcome (TD/B/EX(41)/L. 3) that was endorsed by the meeting.

In the agreed outcome, the 21 recommendations of the EPR (UNCTAD/OSG/2006/1) were placed in three clusters. Cluster 1 comprised the endorsed recommendations, while Cluster 2 comprised recommendations that needed active deliberation before a decision could be made. There was consensus not to pursue the recommendations listed in Cluster 3.

Among the recommendations in Cluster 3 that were rejected was that "UNCTAD's core competencies should be maintained and enhanced so as to reflect their inherent interconnectedness. Clustering or regrouping UN system-wide activities under the headings of development, environment and humanitarian assistance does not appear to be an effective way of dealing with 'core economic development issues'."

Another recommendation that was not accepted was that all heads of UN agencies should sign a compact committing themselves to sticking to their core competencies. Also rejected were proposals to establish an eminent development economists' group, and a technical assistance advisory body.

The endorsed recommendations (in Cluster 1) state that UNCTAD should be a leader in identifying and analysing key emerging issues and to advocate pragmatic solutions (recommendation 1); position itself based on three criteria: comparative advantages, differentiation and complementarity, and strategic and catalytic intervention (4); create genuine partnerships with international organizations (5); increase the involvement of civil society (6); should consider establishing a global network of think tanks (7); overcome confrontational attitudes (10); and increase its participation in country-level and regional development (19).

The endorsed recommendations in Cluster 1 are subject to a number of "understandings" in the Agreed Outcomes.

Recommendation 1 states that UNCTAD needs to be a leader in identifying and analysing key emerging issues and to advocate pragmatic solutions to the most salient development challenges. The recommendation lists key issues such as Aid for Trade, brain drain and investment for development. The understanding is that the list of key emerging issues is "illustrative and non-exhaustive."

Recommendation 4 says that UNCTAD should position itself based on three principle criteria: comparative advantages; differentiation and complementarity; and strategic and catalytic intervention. The understanding is that the principle criteria should be translated into practice in a manner that preserves its mandated role.

Recommendation 5 requires that UNCTAD should create genuine partnerships with international organizations and UN entities that provide complementarities with its own efforts through strengthened cooperation and coordination, with a view to avoiding duplication. The understanding is that cooperation should be based on its mandate, is a collective exercise and that priority is given to partnerships with UN Regional Commissions.

Recommendation 6 mentions that UNCTAD should increase the involvement of civil society including the private sector, giving particular attention to NGOs and small and medium sized enterprises in developing countries. The understanding is that member states' rights at UNCTAD are preserved and that engagement with partners is not on an "equal footing." Effective participation by civil society and SMEs of developing countries is also to be ensured.

Recommendation 7 says that UNCTAD should consider establishing a global network of think tanks specialized in development policy advocacy and strategy-setting. The understanding is that the list of think tanks proposed by Secretary-General Supachai Panitchpakdi is not exhaustive, that there will be effective participation of think tanks from developing countries and countries with economies in transition and that member states' views will be taken into account in the process of implementation.

In a paper on the Secretary-General's Reflections, Supachai had referred to the Development Centre of the State Council and the Research Bureau of the State Council (China), Council of Economic Advisors to the President (United States), African Economic Research Consortium (Kenya), Centro de Estudios para el Desarrollo, CEDES, (Argentina), Instituto Latino-Americano para Estudios Sociales - ILDIS (Ecuador), Thailand Development Research Institute, Council for Research on International Economic Relations (India), Chatham House (United Kingdom), Institute for Strategic and International Studies (Indonesia), Malaysian Institute of Economic Research, Singapore Institute for Public Studies, and the Institute of Development Studies of the Philippines.

Recommendation 10 states that Member States should overcome confrontational attitudes. The explanatory statement here states that there are no confrontational attitudes, "only differences of views and approaches."

(During the October 2006 Mid-Term Review, the EU had threatened to walk out of the negotiations if the EPR was not included in the Mid-Term Review document - see SUNS #6118 dated 12 October 2006.)

Recommendation 18 says that UNCTAD should increase its participation in country-level mechanisms for technical assistance and regional development programmes. The understanding is that the aim is for UNCTAD to participate at country level by providing analytical inputs to UN Country Teams, and not by creating a permanent physical presence in the field. Additionally, its technical assistance remains committed to and goes beyond the framework of the Millennium Development Goals.

Recommendation 19 mentions that UNCTAD should consolidate its projects into four to five major technical cooperation programmes centred on overarching themes for maximizing impact and increasing efficiency and coherence. It should also diversify its funding base. The understanding is that no specific technical assistance activity will be lost and that a decision on this should be taken in consultation with member states.

Cluster 2 included the EPR recommendations where there is "conceptual convergence on the ideas" among the member states, but where further deliberation is required during preparations for UNCTAD-XII before a decision on them can be taken by the TDB or at UNCTAD-XII itself. A number of "understandings" on the ideas contained in these recommendations are also included in the Agreed Outcomes.

Recommendation 9 states that UNCTAD should strengthen its "flagship" research products and major study series, and limit the number of marginal publications. The understanding is that the "decision on the criteria for consolidation of publications will be taken in consultation with member states." In addition, implementation will involve the development of a publications policy.

Recommendation 12 mentions that UNCTAD should consider setting up a Secretary-General's trust fund to finance developing country experts' participation in UNCTAD meetings. The understanding is that the fund already exists and that the challenge was to find a sustainable solution for predictable financing.

Recommendation 13 states that UNCTAD's intergovernmental machinery should provide relevant and pragmatic solutions to development problems. The understanding is that "pragmatic solutions" will not exclude or replace UNCTAD's traditional work on systemic issues.

Recommendation 14 says that UNCTAD's intergovernmental expert meetings should become Standing Expert Groups. The understanding is that this will be implemented in a flexible manner that allows for both expert meetings and Standing Expert Groups.

Recommendation 15 states that UNCTAD Commissions could benefit from a rationalization that foresees a Trade Commission and an Investment Commission and possibly a third commission dealing with technology. The understanding is that the cross-cutting issues of the Enterprise Commission are not lost and that the balance of issues in the other Commissions would not be negatively affected. Consideration should also be given to the possible creation of a Commission on Globalisation and Systemic Issues.

Recommendation 16 states that UNCTAD's high-level segment, which is ineffective, should be replaced by a multi-stakeholder dialogue or by a "Global Forum for Trade, Investment and Development." The understanding is that an annual think tank meeting will not replace the High-Level Segment and that the Global Forum will not be a "Davos type" meeting driven by the private sector.

Recommendation 21 says that UNCTAD should ensure synergy among its three pillars by strengthening its central mechanism for vertical and horizontal coordination. It could also set up multi-disciplinary teams to respond effectively to the emerging needs of developing countries and to make presentations to new government cabinets. The understanding is that some of these services will have to be explored further.

Cluster 3 in the Agreed Outcomes contains 6 proposals which members agree not to pursue because there is divergence of views or that they are considered no longer relevant. These are the EPR's Recommendations 2 (establish mechanisms for clearer division of labour among UN agencies); 3 (enhance UNCTAD's core competencies within the UN structure in dealing with core economic development issues); 8 (establish a consultative group of eminent development economists); 11 (maintain but handle flexibly the Group system in inter-governmental deliberations); 17 (biennialize the Conference); and 20 (establish a technical assistance advisory group).

In the discussion on the Agreed Outcomes, a number of delegations expressed concerns about the implementation of the recommendations. They emphasised the need for consultations and reporting. Paragraph 5 of the Agreed Outcomes requests that the Secretary-General consult and report on the implementation of the agreed recommendations.

Thailand, for the Asia Group, reiterated the need for close consultations with member states on various aspects of implementation, in accordance with the outcomes of the Mid-Term Review.

Brazil, for the Group of Latin American and Caribbean countries (GRULAC), said that the Secretary-General should continue to report and consult on the implementation of the recommendations. China said that implementation should take place after consultation with member states.

Angola for the Africa Group said that its expectations of the UN Reform process was that it should not result in the diminishing or erosion of the role of UNCTAD. UNCTAD's mandate and role should be strengthened.

Germany, on behalf of the European Union, said that it expected the Secretary-General to start consultations with members and that the implementation process should be in close cooperation with member states.

Argentina said that it had every confidence that the Secretariat "would keep us continually updated." Brazil emphasised the need for reporting and consultation as contained in paragraph 5.

Bangladesh stressed that the consultations should be conducted in a transparent way. Bangladesh also said that consultation and reporting was important because the recommendations enjoyed convergence "with caveats." It looked forward to their implementation of the recommendations with the "caveats" and wanted to hear from the Secretary-General as to how this would be done.

It is interesting to note that some recommendations which Supachai had earlier said that he was already implementing, or that were under his mandate to implement, have now been rejected by the TDB meeting or have been subjected to further discussion before adoption.

During the 40th Executive Session of the TDB held in December 2006 to consider the EPR, Supachai reported that of the EPR recommendations, some which may include 7, 8, 9 and 19 were already being implemented. The reason was that these were regarded as within his purview and the proposals were addressed to him (see SUNS #6136 dated 8 November 2006).

Recommendations 7 and 19 have been endorsed by the TDB. However, recommendation 8 has effectively been removed while further deliberations are required on recommendation 9.

During the 40th session, a loose-leaf sheet was distributed indicating that recommendations 7, 8, 9, 19 and 21 were exclusively within the Secretary-General's purview. It also indicated that responsibility for recommendations 5 and 18 was shared with the UN Secretary-General. The UN Secretary-General had within his exclusive purview recommendations 2 and 3 (which have been rejected by their inclusion in Cluster 3).

At that time, the G77 and China, supported by various regional groupings of developing countries, indicated that the proposals of the panel should be each considered on merit and that this consideration should be done by the inter-governmental process at an appropriate time.