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Speech
by Commonwealth Secretary-General
Rt. Hon Don McKinnon to
ACP Committee of Ambassadors,
Brussels 31 October 2000 |
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Your Excellencies, Representatives of the ACP countries to Brussels, Ladies and Gentlemen,
It is my great pleasure to be in ACP House today, and to have the opportunity to share a few thoughts with you, thanks to the hospitality of my friend, Mr Jean-Robert Goulongana
Let me start by saying that our two organisations have much in common. We share a number of common members - as many as 40. The vast majority of Commonwealth countries come from Africa, the Caribbean and the Pacific.
We also share a number of common concerns which should encourage us to strengthen our collaborative efforts and to work closer together.
It is some of these common concerns that 1 wish to address this morning, indicating what the Commonwealth Secretariat is doing in those areas before seeking your views and guidance as to the best ways of strengthening collaboration between our two organisations in the future.
Given the time available, 1 will limit my comments to what we consider to be the main or more urgent concerns facing our membership. These include:
1. first, the issue of a new financial architecture, with the related question of the indebtedness of Least Developed Countries (LDCs);
2. second, the special case of small states
3. third, trade negotiations, both at the multilateral and ACP-EU levels; and finally
4.
the question of democracy and good governance.
IA. DefiningTheNewFinancialArchitecture
All our countries who endured the bitter pill of structural adjustment and felt, however indirectly, the ripples of the East Asian financial crisis, know the importance of having a voice in shaping a more equitable and just financial architecture.
I am pleased to say that the Commonwealth has acted as the conduit through which many small developing nations have been able to make their voice heard in International Financial Institutions. The Commonwealth responded to the East Asian crisis through the work of a high level Expert Group, established in 1997, which provided the basis for a significant contribution by Commonwealth Finance Ministers to the debate in IMF/World Bank Annual Meetings on the reform of the international financial system.
And in June this year we organised, in conjunction with the IMF and the World Bank, a major conference on Developing Countries and the Global Financial Architecture in London. One of its aims, which 1 feel was very successfully achieved, was to facilitate a stronger voice for developing countries in this important debate.
1B. Debt Relief
Many of you are aware of the Commonwealth involvement on the issue of debt relief. Commonwealth Finance Ministers promoted the Heavily Indebted Poor Countries (HIPC) Initiative from the outset.
But throughout the process, we have continually stressed that heavily indebted poor countries simply cannot recover, grow and reduce poverty without a substantial and faster reduction in the burden of unsustainable debt. The disappointingly slow progress in delivering debt relief remains a major concern for the Commonwealth. To date, of the 20 countries targeted for relief by the end of this year, only Uganda, has reached its completion point, but has yet to receive actual cash relief under the new HIPC framework.
Three main obstacles hinder speedier debt relief and must be addressed. These are'.
a. the overload of conditionalities that need to be met before countries can assess HIPC relief;
b. the administrative burden imposed by preconditions; and
c. under-funding of the Initiative.
I am very glad to know that the new ACP-EU Partnership Agreement provides for the use of resources for debt relief of ACP members, thereby partly addressing the under-funding of the HIPC Trust Fund. Since the use of such resources are likely to be tagged to HIPC procedures, it makes our work at the Commonwealth ever more relevant to the ACP, and a closer collaboration between our two institutions all the more important.
In the same breath, however, may 1 urge you to ensure that allocation of resources to debt relief is not done at the expense of development finance which has taken such a battering in the past decade, as testified by OECD statistics. The last Commonwealth FMM in Malta called for continued flows of concessional finance in addition to debt relief.
IC. Harmful Tax Competition
The OECD has attracted the attention of our membership for yet other reasons lately. In an attempt at diversifying their economies, and with the advice and support given by OECD members such as the EU countries themselves to achieve this, many of our small countries are now confronted with the prospect of being blacklisted and incurring economic sanctions because of so-called harmful tax competition. In Malta last month, while acknowledging the need to combat all financial crimes and to address money laundering, Commonwealth finance ministers insisted that tax competition could actually be helpful in spurring governments to create fiscal environments conducive to growth and development. We are therefore assisting our members foster greater dialogue, at both the political and technical levels, on the implications of the OECD proposals.
We have not yet reached agreement with the OECD on such a process, but discussions are continuing. A consultation on this issue is due to be held early next year. It is being hosted by the government of Barbados and organised by the Commonwealth Secretariat in association with the OECD. We believe that such a dialogue will help narrow differences and hopefully encourage OECD countries to pay greater attention to the situation of developing countries concerned.
2. Small States
The ongoing work on the harmful tax competition issue is but one of the issues confronting small states which the Commonwealth has been addressing recently. It is worth recalling that the Commonwealth has taken several initiatives that have contributed to increased international awareness of the vulnerability of small states. The Commonwealth/World Bank Joint Task Force on Small States, established in 1998, is a potent illustration of such initiatives. The final report of the Task Force was submitted to the World Bank's Development Committee this year and included work programmes, which partner organisations have committed themselves to implement in the near future.
In this context, may I commend ACP negotiators for collectively defending the special case of small states and LDCs during the recent negotiations with the EU. Of course, we would have preferred that the new mechanism due to replace STABEX had retained the latter's special treatment of small states. I understand that due consideration will be given to this question when reviewing the implementation of the new mechanism.
3A. Trade Negotiations
Mr Chairman, let me now turn to the issue of trade negotiations. A few words first on multilateral trade talks, before examining the issue of ACP-EU post-Lome trading arrangements.
As you know, Seattle reasserted the need to work on the basis of consensus and raised concerns about the 'green room process'. It has also brought home the need to ensure that countries are not marginalized, but that they all share in the benefits accruing from growing world trade. Our members who are currently negotiating on agriculture and services, are loudly expressing their disappointment with regard to implementation, and are calling for real confidence building measures before agreeing to the launch of a New Round.
At the Commonwealth, we are assisting our developing country members build their negotiating capacity to better pursue their interests in on-going negotiations and in an eventual new Round. Besides assistance provided by our Geneva- based consultant, we have just launched a new series of Policy Briefs on WTO issues aimed at capitals, which try to bridge the gap between negotiators in Geneva and their counterparts at home. This will soon be complemented by a dedicated web-site specialising in trade issues and whose primary target will also be the capitals.
We are also giving serious consideration to a proposed expansion of our facilities in Geneva itself. We will ensure that our assistance, targeted mainly at small state delegations and countries without representation in Geneva, complements rather than duplicates the proposed ACP Geneva Office or any other facility that may already cater to developing countries in Geneva. The MoU that our two institutions will sign should ensure vital exchange and collaboration necessary to develop synergy in this area of importance to ACP countries.
3B. Post-Lome Trading Arrangements
Mr Chairman, the Commonwealth Secretariat has a long history of supporting the ACP in its negotiations with the EU. The Commonwealth Secretariat supported the ACP Group in the Mid-Term Review of Lom6 IV (1995) and more recently in the ACP-EU negotiations that ended last February. With regards to your recent negotiations:
- We commissioned studies on the trade options under negotiation and on feasible alternatives. In this respect, Dr Stevens' After Lom6 IV has become a seminal work that is quoted in almost all subsequent publications on the subject.
- We also organised workshops in Brussels, in conjunction with the ACP Secretariat, to discuss these studies with ACP representatives.
- At the request of the Chair of the Trade Negotiation Group, we prepared a Brief on the contentious STABEX issue.
- Finally, I cannot fail to mention our lobbying of non-ACP Commonwealth members in support of the waiver application to the WTO.
3C. The Diversity Asset
Mr Chairman, it is a truism that man cannot live on bread alone. Each and every one of us aspires to freedom and democracy which can take different forms, reflecting our different histories and culture. Alongside its involvement in global economic issues, the Commonwealth is also actively engaged in advancing the fundamental political values set out in the Harare Commonwealth Declaration of 1991. This Declaration underlines the Commonwealth's distinctive role in the promotion of democracy, human rights, good governance and the rule of law.
Over the years, we have developed a wealth of experience in these areas. For example, we have constituted over 30 Election Observer Groups as a specific contribution to confidence building in the democratic process and have sent teams to ACP countries such as Nigeria, Papua New Guinea and St Kitts & Nevis. A full observer group is currently in the United Republic of Tanzania. In recognition of the axiom that elections alone do not make democracy, the Secretariat has placed particular emphasis on technical assistance geared towards institution and capacity building, and the buttressing of democratic culture.
Our unwavering belief in the fundamental principles and values encapsulated in the Harare Declaration, led Commonwealth leaders to set up a Commonwealth Ministerial Action Group (CMAG, 1995) to address serious and persistent violations by member countries of these principles.
As another result of this common trust in the organisation and its shared values, 1 have been called upon frequently, in my capacity as Commonwealth Secretary-General, to contribute to the prevention and resolution of conflict in member countries. There is no doubt that conflict poses a serious threat to democracy and acts as a major constraint on the development process. Unfortunately, several of our countries remain plagued by this evil. This is a field where the ACP and the Commonwealth Secretariat could usefully collaborate for the benefit not only of their members, but of mankind as a whole.