Common Positions on Trade Emerge During UNCTAD Executive Session (Second Postcard from Geneva)

As I mentioned in my last post, delegates from the least developed countries (LDCs) are meeting at multilateral institutions in Geneva to determine their priorities and objectives for the upcoming UN MDG review summit in September and the Fourth UN Conference on the Least Developed Countries (LDC-IV) conference next May. Last week, the UN Conference on Trade and Development’s (UNCTAD) board held an executive session to hear suggestions from the LDCs and invited experts, including CGD’s Kim Elliott, on what international actions might spur growth and prosperity in the poorest countries.During the day-long meeting, speakers deliberated numerous development issues—from food security to tourism, climate change to youth empowerment. Despite the breadth of their discussion, conference participants expressed general consensus on the importance of meaningful, accessible trade opportunities for the LDCs, specifically:

• Concluding the Doha Round as quickly as possible, or, if that goal remains elusive, immediately resolving issues that would improve market access for LDC exports, including:
  • Providing duty-free, quota-free market access for all products from all LDCs;
  • Simplifying rules of origin (which Kim discussed during her presentation and previously with the WTO’s LDC group); and
• Encouraging aid for trade, including the continuation of the Enhanced Integrated Framework (EIF).

These are among the key policy recommendations made in CGD’s global trade preferences working group report.While trade policy changes can contribute to economic growth in the LDCs, participants in the session argued these changes must be complemented by efforts—and funding—to overcome supply-side obstacles. Even with duty-free quota-free market access, a poor producer will not be able to take advantage of trade opportunities if he or she must stop to pay bribes or wait several days to clear customs. Anthony Maruping, the permanent representative of Lesotho in Geneva, struck a chord when he declared that the LDCs need “an enabling environment” to achieve and sustain growth, including good governance and adequate infrastructure. (CGD’s trade preference report includes an annex on supply-side challenges.)Another big take-away from the UNCTAD conference was the recognition that all stakeholders have unique and important roles to play in the development process. The LDCs must assess and communicate their needs clearly to donors, and responsibility for the priorities they push. There was a great deal of discussion of the need to invest in LDCs’ productive sectors—including science and technology—in addition to social projects. There was also broad agreement that the international community should better incorporate the LDCs in global governance, particularly through the G-20. With so many moving parts and players, participants said an agreement to come out of LDC-IV must include an accountability framework with clear indicators and specific timeframes.In the coming months, policymakers in the Obama administration and Congress will need to decide what the United States will contribute. Many people we spoke with were particularly curious about Washington’s position on reforming the U.S. Generalized System of Preferences (GSP) and on delivering duty-free, quota-free market access for LDCs. As planning continues for upcoming events—the UN MDG review summit in New York in September, the G-20 Seoul summit in November, and the UN LDC-IV conference in Istanbul next May—pressure will steadily increase for the U.S. to lead international efforts to improve trade opportunities for the LDCs.