South leaders brainstorm South-South cooperation

Realizing the potential of South-South cooperation was the subject of a recent meeting of developing-country leaders and experts in Fiji, writes Martin Khor.

GENEVA: On 7-8 May, the idyllic Pacific island of Fiji played host to some political leaders and thinkers of developing countries brainstorming the future of South-South cooperation.

Fiji was the venue as this South Pacific island state is the Chair of the Group of 77 (G77), the alliance of over 130 developing countries that operate in the United Nations and beyond. Its government decided to host “eminent personalities of the South” to reflect on the state of the developing world and on South-South cooperation.

The theme may not be original, but the personalities discussing it were colourful, most of them being presidents or prime ministers, and mainly from the South Pacific island countries.

The host, Fiji’s Prime Minister Josaia Bainimarama, presented the rationale for the meeting at the opening session.

He said that the past decade has seen the decline of North-South cooperation. Negotiations in trade, environment and funding of development have stalled, and the rich countries are attempting to modify the principles of development cooperation and their commitments to it.

But meanwhile, he added, there has been unprecedented growth in developing countries, and new dynamism in South-South cooperation through trade, finance, technology and shared management of natural resources. The time has thus come to rethink existing development patterns and realize the full potential of South-South cooperation.

The chief guest, Bolivia’s President Evo Morales, said he is the first Bolivian leader to visit the South Pacific and wanted to share his experiences from the other side of the Pacific.

Morales is the first indigenous person who has become a recent leader of a South American country and his passionate speech made a deep impression.

He spoke about the Bolivian respect for humanity and life, and the importance of reclaiming land and natural resources for the nation. Bolivia did this through some nationalization of oil resources and the renegotiation of contracts with foreign companies in order to get a bigger share of revenues from natural resources.

The greatly increased revenues have been used to fund social development, enabling poverty and child mortality to decline. Bolivia has ensured that the poor have access to essential services like water, electricity and healthcare. For Morales, these services are human rights that the government has to provide and they should not be privatized, a message he wants to share with the South.

He also criticized the failed model of the North, where finance and banks were given priority over people’s interests, and called for the South to collectively seek new pathways in which people are given the priority.

Morales’ focus on getting the most out of resources resonated with the Pacific island leaders, whose countries are also resource-dependent.

Kiribati’s President Anote Tong spoke about how the region’s fishery resources were so exploited that it obtained only 5% of the revenues while the rest was taken by others.

Developed countries consume far more than their fair share of the world’s depleting resources. There is a need for fair allocation, and this is made more acute by the threat of climate change. There is a need  to address the ownership of resources and to rationalize the rights and use over resources, and the South should form alliances to find solutions.

Advancing the same theme, Prime Minister Gordon Darcy Lilo of the Solomon Islands said the South was the source of raw materials used in the North, but developing countries do not have power over the prices and revenues they receive for their resources. For example, the South Pacific countries should get a fair share of revenues from tuna fish, but this requires a new world order which the South has to build.

Leonel Fernandez, until recently the President of the Dominican Republic, referring to Morales’ policies of regaining control over natural resources to fund social policies, said there has been a change from the old paradigm that the markets can regulate themselves. Instead, an alternative model is developing in which social policies are in the centre and governments need to ensure there is a balance between the state and the market.

With the North in decline, South-South cooperation is now more important. An example of the solidarity that can underlie this is the preferential terms of oil supply that former Venezuelan President Hugo Chavez gave to neighbouring countries that helped them cope with financial problems.

Fernandez also highlighted the role of speculators as a new element causing high volatility of commodity prices, which is an issue that the South should collectively address.

The Prime Minister of Vanuatu, Moana Carcasses Kalosil, called for an even more fundamental change – that of lifestyles. The Pacific islands are disappearing due to climate change. The world cannot afford the growth of money, cars and material things. It is the way of life that needs to be addressed, and this requires a joint fight by the South.

China’s special envoy to the Pacific Islands Li Qiangmin said South-South cooperation is different from North-South aid as the South-South relations are based on equity and mutual benefit. With the decline in aid and rising financial instability, South countries have to rely more on themselves for growth, trade and investment.

The Executive Secretary of the UN’s Economic and Social Commission for Asia and the Pacific, Noeleen Heyzer, said it was perhaps time for a second Bandung Conference, referring to the historic meeting of Asian and African leaders in 1955.

She said it is important for the South to address the multiple shocks that developing countries are being subjected to, including economic crises and natural disasters, and that had grown in recent years.

She also spoke about the importance of the role of the developmental state and South-South cooperation in the areas of greater connectivity, investing in agriculture, monetary cooperation, poverty eradication and coping with natural disasters.

The meeting concluded with the adoption of a formal document giving proposals on how to advance South-South cooperation (see following article).

But it was the free flow of ideas and reflections of the colourful political leaders that made the most lasting impressions, together with the paradise-island background of the meeting.                

Martin Khor is Executive Director of the South Centre, an intergovernmental policy think-tank of developing countries.

Third World Economics, Issue No. 546, 1-15 Jun 2013, pp 2-3