Report by Congressional Advisers to UNCTAD IV

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Title:
Report by Congressional Advisers to UNCTAD IV
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vii, 201 p. : ; 24 cm.
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United States -- Congressional Advisers to the Fourth Meeting of the United Nations Conference on Trade and Development
United States -- Congress. -- House. -- Committee on International Relations
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At head of title: 94th Congress, 2d session. Committee print.
Statement of Responsibility:
by members of the House Committees on International Relations ... et al..

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Table of Contents
    Front Cover
        Page i
        Page ii
    Foreword
        Page iii
        Page iv
    Letter of transmittal
        Page v
        Page vi
    Table of Contents
        Page vii
        Page viii
    Background
        Page 1
    Issues at UNCTAD IV
        Page 2
        Page 3
        Page 4
        Page 5
        Page 6
        Page 7
    Conclusions
        Page 8
    Appendix A. Manila declaration and program of action
        Page 9
        Page 10
        Page 11
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    Appendix B. Speech by Secretary of State Henry A. Kissinger before Fourth Ministerial of the United Nations Conference on Trade and Development, May 6, 1976
        Page 86
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    Appendix C. Resolutions and recommendation adopted by the Conference at its fourth session
        Page 101
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    Appendix D. Resolution on the International Resources Bank
        Page 190
    Appendix E. U.S. statements of reservation and/or interpretation of UNCTAD resolutions
        Page 191
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    Appendix F. Press statement by Deputy Secretary of State Charles W. Robinson, May 31, 1976, Nairobi
        Page 198
        Page 199
    Appendix G. Joint statement on UNCTAD IV by Secretary of State Henry A. Kissinger and Secretary of the Treasury William E. Simon, June 1, 1976
        Page 200
        Page 201
        Page 202
    Back Cover
        Page 203
        Page 204
Full Text
y\/L.I^j /u


94th Congress 1
2d Session J


COMMITTEE PRINT


REPORT BY CONGRESSIONAL ADVISERS TO

UNCTAD IV





BY MEMBERS OF THE HOUSE COMMITTEES ON-

INTERNATIONAL RELATIONS
WAYS AND MEANS
BANKING, CURRENCY, AND HOUSING
AGRICULTURE
LABOR AND EDUCATION

AND THE SENATE COMMITTEES ON-

FOREIGN RELATIONS
FINANCE


JULY 21, 1976


U.S. GOVERNMENT PRINTING OFFICE
WASHINGTON : 1976


19-2


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74-0330



























CONGRESSIONAL ADVISERS TO THE FOURTH
OF THE UNITED NATIONS CONFERENCE
TRADE AND DEVELOPMENT


HOUSE OF REPRESENTATIVES

JONATHAN B. BINGHAM, New York,
Committee on International Relations
HERMAN T. SCHNEEBELI, Pennsylvania,
Committee on Ways and Means
THOMAS M. REES, California,
Committee on Banking, Currency, and Housing
JOHN N. ERLENBORN, Illinois,
Committee on Education and Labor
BOB BERGLAND, Minnesota,
Committee on Agriculture
JOSEPH L. FISHER, Virginia,
Committee on Ways and Means


MEETING
ON


SENATE

JACOB K. JAVITS, New York,
Committee on Foreign Relations
MIKE GRAVEL, Alaska,
Committee on Finance
ROBERT PACKWOOD, Oregon,
Committee on Finance


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FOREWORD


HousE OF REPRESENTATIVES,
COMMITTEE ON INTERNATIONAL RELATIONS,
Washington, D.C., July 21, 1976.
This report was submitted by the delegation of congressional
advisers to the fourth meeting of the United Nations Conference
on Trade and Development. It is being printed in the belief that it
will further the understanding of the committee and the Congress
of UNCTAD and of international economic developments.
The findings of this report are those of the members of the congres-
sional delegation and do not necessarily reflect the views of the member-
ship of the Committee on International Relations or the Congress as
a whole.
THOMAS E. MORGAN, Chairman.


(in)




















Digitized by the Internet Archive
in 2013














http://archive.org/details/repngress00unit









LETTER OF TRANSMITTAL


Hon. CARL ALBERT,
Speaker,
House of Representatives.
Hon. NELSON ROCKEFELLER,
President,
United States Senate.
The concern of various Members of the House and Senate over the
direction of U.S. foreign economic policy led them in early 1975 to
initiate a dialog with the executive branch over U.S. policy at the
upcoming Seventh Special Session of the United Nations, September
of 1975. This process culminated with Members of both bodies serving
as congressional advisers to the U.S. delegation to the Seventh Special
Session.
This interest in international economic developments continued,
and in early 1976 a similar dialog was initiated in preparation for
the Fourth Meeting of the United Nations Conference on Trade and
Development (UNCTAD). Upon the invitation of the Secretary
of State, you appointed a group of Senate and House Members to
serve as special advisers to the U.S. delegation to UNCTAD IV.
On behalf of that delegation, we are pleased to submit the following
report on the UNCTAD IV conference. We feel that congressional
participation in major international economic conferences is vital
and should be expanded both through wider consultations with
Members of Congress prior to such conferences and through broad
congressional representation at the meetings.
The congressional advisers would like to express their appreciation
for your having given them the responsibility for serving in that
capacity.
Sincerely,
JONATHAN BINGHAM.
JACOB JAVITS.















CONTENTS

Page
Foreword ------- ----------------------------------------------- iii
Letter of transmittal------------------------------v-------
Background ------------------------------------------------------- 1
Issues at UNCTAD IV --------------------------------------------2
U.S. position----------------------------- -- 3
Conflicts4----------------------------------------------------
Lack of group B position-------..-------------------------------- 5
U.S. reservations------------6----------------- 6
International Resources Bank---------------6---------------- 6
Conclusions------------------------------------------------------- 8
Appendix:
A. Manila Declaration and Program of Action ------------------ 9
B. Speech by Secretary of State Henry A. Kissinger before the
Fourth Ministerial of the United Nations Conference on Trade
and Development, May 6, 1976 ---------------------------- 86
C. Resolutions and Recommendation Adopted by the Conference at
its Fourth Session- ------------------------------------- 101
D. Resolution on the International Resources Bank ---------------- 190
E. U.S. statements of reservation and/or interpretation of UNCTAD
resolutions ---------------------------------------------- 191
F. Press statement by Deputy Secretary of State Charles W. Robin-
son, May 31, 1976, Nairobi-------------------------------- 198
G. Joint statement on UNCTAD IV by Secretary of State Henry A.
Kissinger and Secretary of the Treasury William E. Simon,
June 1, 1976--------------------------------------------- 200
(viin)












REPORT BY CONGRESSIONAL ADVISERS TO UNCTAD IV


BACKGROUND
The years, 1974-76 have seen a major effort at analyzing and
restructuring the international economic system. Since the mid-1960's
the developing nations have been seeking ways to enhance their role in
and benefit from international economic relations-trade, investment,
and financial flows. Because their role in this system had been so minor
and their political leverage so limited, the industrial nations were able
to ignore their complaints and demands.
This situation abruptly changed in 1973-74 due to several factors.
The growing frustration felt by the developing countries over their
inability to receive a hearing from the advanced nations made them
increasingly more radical on international economic issues; at the same
time, they were becoming more knowledgeable and sophisticated in
their understanding of the workings of the international economic
system. Furthermore, this attitudinal change was given economic-
political power by the energy crisis. Suddenly a group of developing
nations had a monopoly on the marginal supplies of a key resource.
When the industrial nations realized they were dependent on the
OPEC nations for oil to fuel their economies, they also recognized more
clearly that developing nations played an important role in other com-
modities. The industrialized nations were rudely awakened to the fact
that through trade and investment they had become intertwined with
the economies of the developing world and that their own prosperity
would be affected to an increasing degree by economic and political
developments in the Third World.
This interdependence was only dimly received at the time of the
Sixth Special Session of the United Nations in May, 1974. At that
meeting the Group of 77 (the developing countries) placed their
Declaration and Program of Action for the Establishment of a New
International Economic Order on the table and the industrial nations
rejected it. Little effort was made to reconcile the differences between
the Group of 77 and the Group B countries (iidu,,trial nations) on
these documents calling for a restructuring of The international eco-
nomic system.
Subsequent to the Sixth Special Sesion, there occurred a major
reevaluation of U.S. foreign economic polkiv. The reappiainal was
undertaken: one, because of a realization that the United tct ard
the industrial nations would be faced with these same issue- at the
Seventh Special Session of the United Nations and at other interna-
tional meetings; two, because thle anticipated splitt )betwe.1n ll' oil
exporting and non-oil exporting developing cowntrit's failed to ina-
terialize and their solidarity actually was stren.thenl, a:t the April
1975 "Producer-Consi.unier Dialoguc" in Paris; three, lca..-e of fear-
(1)







that the OPEC nations would use their oil as a political lever to force
the developing countries into backing the more radical Third World
demands; fourth, because if the U.S. remained totally negative the
other OECD nations might split apart and adopt a more conciliatory
position on their own; five, because of a growing appreciation that
the entire new international economic order package was not neces-
sarily inimical to the interests of the industrial nations and thus it
might be possible to seek a restructing of international economic
relations in a way that benefited both the developing and the devel-
oped nations.
This reappraisal led to a major shift in focus in U.S. foreign economic
policy-toward an effort to reach accommodation with the developing
nations on international economic issues-and to a U.S. position at
the Seventh Special Session that helped to turn the atmosphere of
confrontation into one of cooperation. Whereas the Sixth Special
Session had produced a unilateral list of demands by the developing
nations, the Seventh Special Session produced a consensus Resolution
on Development and International Economic Cooperation that set
forth an agenda of issues to be discussed over the following several
years. Although the United States made several reservations to the
resolution, there was general agreement that the climate for inter-
national economic discussions had been turned around and that the
stage had been set for a constructive dialog.
Following the Seventh Special Session, ministers from 19 develop-
ing and 8 developed nations met in Paris in December of 1975 to
establish the Conference on International Economic Cooperation
(CIEC). That meeting created four commissions-on raw materials,
energy, development, and finance-to meet roughly once a month for
the following year and agreed upon a general list of subjects for
consideration by each commission. Like the Seventh Special Session,
the CIEC ministerial was characterized by a willingness of each side
to compromise and to consider the interests of the other.

ISSUES AT UNCTAD IV
The latest in this line of international economic conferences was
UNCTAD IV, the fourth meeting of the United Nations Conference
on Trade and Development, held in Nairobi, Kenya, May 3-31, 1976.
The agenda for this conference was essentially set by the Group of
77 (now 114 nations) in the Manila Declaration, agreed to in Manila
in Febrliary 1976. Thlat Declaration (see appendix, p. 9) covers
numerous issues, but the focus is on commodities, technology, and
debt.
Many of the proposals in the declaration were acceptable to the
industrial nations. On commodities, however, there was major dispute
involving the proposed UNCTAD integrated commodity approach.
By the opening of the UNCTAD conference, the U.S. position on
commIfodlities-a "coM )r.lellesive tpproach'"-was similar in some
r,.spects, to the UNCTAD proposal, but differed in other aspects.
They both incltli e(d the consideration of buffer stocks, the case-by-case
negotiation of specific conmiodity agreements, enhancement of
(cormpensatory financing inechanismnis, an(d improvement in raw
riiteruil invest ient. The U.S. was generally skeptical about conm-
m,)d1ity tvgrt,,riiients. It wAs arged(I that moI)st developingg countries,
as net imiporters of raw materials, would not benefit.







The main differences were over the financing of buffer stocks
and the number of commodities for which buffer stocks are appro-
priate. The UNCTAD integrated commodity approach included
the concept of a common fund which would finance buffer stocks.
The U.S. position was that there are multiple sources of financing
for buffer stocks-contributions by participating countries, export
taxes, commercial borrowings guaranteed by participating countries,
existing international lending institutions, and, lastly, possibly
financing from a new international financial institution.
The developing nations argued the common fund was important
because it would solve the main problem in establishing buffer stocks-
financing. The United States argued against the common fund
on several grounds. Its very existence would tip the balance toward
signing commodity agreements the United States would not otherwise
enter; the fund might not be the best use of scarce financial resources;
and it could be employed to raise rather than simply stabilize prices.
In the area of technology, the main dispute was whether a code of
conduct for technology transfer would be voluntary or legally binding.
The Manila Declaration called for the establishment of a legally
binding code. The United States argued for a voluntary code.
On debt, the controversy revolved around the Manila Declaration
proposals for debt moritoriums or cancellations for developing coun-
tries and for the convening of an international conference to determine
ways of implementing principles and guidelines on the renegotiation
of official and commercial debts. The United States opposed these
proposals on the grounds that most developing countries do not have
a debt-servicing problem; those countries which do have a debt-
servicing problem can be dealt with on a case-by-case basis under the
current "Paris Club" arrangement. In addition, to attempt a general
approach would damage the credit worthiness of many developing
countries which have ready access to international financial markets.
There were also less important conflicts over provisions dealing with
trade in manufactures and the institutional role of UNCTAD. The
principal focus was on commodities, and, as the conference wore on,
the common fund became the key issue of the conference.
U.S. position
As at the Seventh Special Session, the United States was the only
industrial nation to present a comprehensive position in response to
the Group of 77 agenda. On both occasions the U.S. policy statement
was the product of discussions both within the executive and between
the executive and some Members of Congress. The process within the
executive involved an extensive effort to arrive at proposals that met
the needs of the developing world while at the same time protecting the
U.S. national interest and reconciling conflicting bureaucratic in-
terests and views. The congressional role included hearings and meet-
ings with administration officials and serving as congressional advisers
at the conferences. Whereas some members of the congressional dele-
gation-mainly those from committees with which the Department of
tate traditionally deals-felt the Department had adequately con-
sulted with them prior to UNCTAD IV; other members-mainly
those from committees with which the Department has few dealings-
felt those consultations were inadequate.
Secretary of State Kissinger and Deputy Secretary Robinson are to
be commended for guiding the U.S. position in a direction that was






generally viewed as being forthcoming in trying to deal with the
problems of the developing world and that was successful in moving the
discussions onto a fruitful plane. Unfortunately, contrary to develop-
rnents at the Seventh Special Session, the favorable climate established
at the opening of UNCTAD IV was not maintained through to the
conclusion of the conference.
The United States and most Western industrial nations do not ac-
cept thle intellectual underpinning of the Manila Declaration, the need
for a new international economic order. Although there was not great
variance between the U.S. position and many items in the Manila
Declaration, there were substantial differences on key agenda items.
Nevertheless, 4 weeks of discussions should have allowed sufficient
time for the differences to be accommodated.
Conflicts
The differences over substance were compounded by problems of
tactics and structure. UNCTAD is organized so as to emphasize bloc
politics and solidarity and to make difficult if not impossible the give
and take of views of the individual participating members. UNCTAD
is structured so that the developing nations (Group of 77) caucus and
negotiate as a group and the Western industrial nations (Group B)
caucus and negotiate as a group. This requires each group to try to
form a common position and creates pressure for individual nations
not to deviate from the position of the bloc, thereby making it difficult
for nations to form common positions across the bloc positions.
Second, the Group of 77 came to Nairobi with an agreed position,
but the Group B countries d(lid not. Tlhe Group of 77 met in Manila
in February and reached agreement on the Manila Declaration as
their position for UNCTAD IV. Due to the wide dispersion of interests
within the Group of 77, the Manila Declaration was produced not by
reaching an agreed position through negotiations but by putting
together a basket of the interests of each member.
The Group B nations, on the other hand, devoted very little effort,
towar(l reaching an agreed position prior to the conference. The ink
Oil Ki-singer's speech was hardly dry when it was delivered in Nairobi.
In fact, few delegates were aware of the details of the U.S. speech
when it was delivered by the Secretary of State. Theoretically, the
industrial nations could have reached an agreed position during the
first week or 10 days of the meeting. In fact, it was the evening of
May 27, the day before the conference was supposed to end, that
Group B presented a unified position to the conference; even then,
there were ichtually two different position papers, each with reserva-
tions by various Group B countries.
In the meantime, the Group of 77 became irritated with negotiating
only on the minor issues and not being able to discuss the important
matters with the Group) B countries. Furthermore, the more the
industrial nations debated the issue of commodities and( the common
fund, the inore the (Gropl) of 77 became disturbed by the attacks onl
the common fuln(d and the more committed they became to it. What
had begun as an important elemneit of ill imIportant package had, by
the fourtli week of the conference, become the overriding issue of the
conference. By the last week, thlie common fund had become the
I lliflic'l .symu'bol ,if the ,o( I faitli conmnitment to enter into commodity
agreemrnen t, ofr tlie success,., or failure of the conference and of the
ability of the dlevelolping nations to obtain a fair hearing from the
industrial nations.







Lack of Group B position
Whereas during the first 2 weeks of the conference the industrial
nations through substantive discussion with the Group of 77 could
have demonstrated their legitimate concern over the financing of
buffer stocks and explained the possible disadvantages of a common
fund as outlined in the UNCTAD proposal, this opportunity was
lost through the failure of the Group B countries to reach an agreed
position early on.
The delay of the Group B countries in reaching a common position
on commodities can be assigned\ to three factors. First, the United
States failed to inform adequately the other countries of its proposed
position for UNCTAD. This was in part because the United States
itself seemed unprepared. Up until the end of the conference, there
was dispute between various departments within the U.S. Government
over the details of the U.S. position, details which should have been
ironed out before the conference began. The fact that no cohesive
U.S. position was developed early enough obviously hindered the
United States in trying to take a leadership position and bring to-
gether the industrial nations. Still, the United States could have done
more to alert the other industrial nations to the general approach
contained in Kissinger's Nairobi speech, both in Nairobi and prior
to it.
Second, and more important, the European Community was unable
to reach an agreed position. The Group B nations should have been
able to agree on a position during the first portion of the conference,
but they were never able to negotiate fully among themselves because
the European Community could not reach a common position.
Third, Group B's position was primarily defensive; the major con-
cern was to limit economic concessions without suffering political
damage. The United States, like many of the other industrial nations,
saw UNCTAD as politically important but not the most satisfactory
forum for the resolution of important economic issues. There was also
division among Group B on the proper strategy to pursue: present a
hardline position and then negotiate with the Group of 77 expecting a
compromise middle result, or make concessions in a Group B position
paper with the hope of placating the Group of 77. Certain Group B
members wished to seem forthcoming without conceding anything of
substance. France, for example, proposed the consideration of the com-
mon fund after commodity agreements had been negotiated, which
many developing countries might argue would leave no rationale for the
fund. Norway, Sweden, and the Netherlands wanted to go further
than other Group B members for political reasons. These differing
political perceptions made agreement virtually impossible to reach
among Group B countries.
Aside from these structural and tactical hurdles, the differences by
the end of the conference had be-ome somnewlhat semnantical. The main
issue over the common fund was that the Group of 77 wanted a conm-
mitment to negotiate the common fund, whereas the United States and
other industrial nations insisted that they would only enter discus-
sions, not negotiations. The U.S. delegation made the point that
negotiations imply an agreed upon objective, whereas the United
States did not yet accept the objective of the common fund. The de-
veloping nations did not seem to apply such a strict definition to the
term "negotiate," but the United States held firm to its position.







Failure to reach an accommodation on commodities held up discus-
sions of debt and other issues as the Group of 77 wanted agreement on
this important matter before discussing other issues. It was the assess-
ment of many that agreement on commodities would lead to the res-
olution of other disputes.
i.S. reservations
The congressional delegation which attended the last week of the
conference urged the administration not to jeopardize the U.S. position
over an issue of semantics, but apparently to no avail. When the final
declaration was agreed to, the United States found it necessary to
make what appeared to some observers to be several unnecessary
reservations.
First, with regard to commodities and the common fund, the United
States made the reservation that its vote in favor of the resolution was
not to be interpreted that it would enter into negotiations on the estab-
lishment of specific commodity agreements or of the common fund, but
only to discuss the nature of the problems affecting various commodi-
ties and the appropriate measures required and to discuss the methods
for financing buffer stocks. The idea behind this reservation, in fact, is
reflected in the resolution, which includes such language as: agree-
ment "toward the negotiations of a common fund" (the preposition
"toward" was actually suggested by a member of the congressional
delegation as a means of avoiding a firm commitment to negotiate);
".. noting that there are differences of views as to the objectives
and modalities of a common fund;" ". preparatory meetings for
international negotiations on individual products." In light of this
recognition of differences of opinion on the common fund and call for
preparatory meetings, the U.S. reservation was perceived by some to
be somewhat redundant.
The U.S. statement of reservations also included a sentence to
the effect that the resolution does not ". . alter our reservations on
the concept of indexation." In fact, the word "indexation" is never
mentioned in the resolution and the only remote reference to the
concept is in a provision that calls for price determinations similar
to the provisions that the United States agreed to in the International
Tin Agreement.
The statement of reservations notes that the resolution does not
indicate ". . any change in our known views on the new inter-
national economic order and its basic documents"-an apparently
ol)vious but unnecessary statement.
International Resources Bank
The statement of reservations represented poor strategy and timing
and may have impacted negatively on U.S. interests, specifically on
the U.S. proposal for the creation of an International Resources Bank
(IRB). In his speech at Nairobi, Secretary Kissinger suggested the
(establishment of a new institutional mechanism to encourage invest-
ment in resource extraction projects in developing nations. An inter-
national consortium of private banks and companies, governments,
and international financial institutions would provide the investor
with greater protection for his investment and would make investment
more attractive to the host country by removing it from the direct






control of a foreign company. The idea was favorably received by
many developing nations but was rejected at the end of the conference
by a vote of 31 to 33, with 89 abstentions and absentees.
SThere are various reasons, mostly tactical errors, which contributed
to the defeat of the resolution on the International Resources Bank.
First, the U.S. statement of reservations is credited with playing a
major role. The United States attempted to negotiate a joint state-
ment of reservations with the United Kingdom, West Germany, and
Japan, and, through some means, the draft statement was made
available to the other delegations while a small negotiating group was
still putting together the consensus resolution on commodities. This
statement of reservations seemed to some to indicate a lack of good
faith on the part of the United States to consider seriously the com-
modity problems of developing nations. Consequently, the developing
nations reacted by abstaining from the vote on the resolution endorsing
the concept of the International Resources Bank. Had the substance of
the U.S. reservations not been made known until after the voting on
the resolution, perhaps the International Resources Bank might have
been saved.
Second, the United States failed to inform fully other nations
of the proposal for the creation of an International Resources Bank
prior to the conference. Effective prior briefing would have allowed
them to study the proposal and to have been prepared to discuss it at
the conference. Furthermore, once the conference was underway, the
U.S. delegation failed to press the concept or to present a position
paper to explain fully its purpose and possible functions and structure.
When this effort was finally undertaken in the waning days of the
conference, it was too late for the other delegations to study adequately
the idea or to obtain their government's position; further, by the end
of the conference the climate was too politicized to achieve the progress
on the proposal that would have been possible during the first part of
the conference.
Third, the United States agreed to a separate resolution for the
International Resources Bank. Had the U.S. delegation insisted that
it be an integral part of the commodities resolution, thereby tying its
fate to that of the commodities resolution, perhaps the result would
have been different.
Fourth, a factor over which the United States had no control was
the failure of a black African to be included in the "President's contact
group." This was taken as a slight by the black African nations and,
rather than demonstrating their pique by voting against the consensus
resolution on commodities, they voted against or abstained from the
vote on the International Resources Bank.
Following the conclusion of the conference and rejection of the
International Resources Bank proposal, Secretaries Simon and
Kissinger issued a joint statement blaming the proposal's defeat on an
"accidental majority" of countries inspired or created by the Socialist
countries. From the view of the members of the congressional delega-
tion to UNCTAD, this is a mistaken interpretation of events and
forces at work at Nairobi. Some foreign press accounts. were no closer
to the truth when the vote was characterized as a rebuff to Secretary
Kissinger. Contrary to the Secretaries' statements, the defeat appar-
ently had little to do with pressure from the Socialist countries, a
group which is virtually without influence in UNCTAD.







CONCLUSIONS
The United States presented at UNCTAD IV a position that, in
general, was well thought out and made significant proposals toward
helping the development of the Third World and bringing them more
into the international economic system. The position was the result
of the dedication and many months work of numerous officials of the
U.S. Government, a process which included consultations with the
congressional delegation to UNCTAD IV and other Members of
Congress. It is unfortunate that this excellent work became blotted by
the failure of the industrial nations to reach an agreed position and by
arguments over semantics. The confrontation at the end could have
been avoided by better and earlier preparation by the industrial na-
tions as a group and by a better appreciation by those in Washington
who were making the final decisions of the dynamics involved in the
conference.
In contrast to the Secretaries' statements, Deputy Secretary of
State Charles Robinson made a press statement at the conclusion of the
conference which appropriately highlighted the positive accomplish-
ments of the conference and provides some hope that the disagreements
at UNCTAD IV were a product of the circumstances and not a signal
of a return to the confrontation of the Sixth Special Session. It should
he noted that Deputy Secretary Robinson's arrival marked the intro-
duction of new flexibility in the U.S. policy stance.
Concerning the role of congressional advisers to such international
economic meetings, Secretary Kissinger is to be commended for the
steps taken to consult with Congress prior to UNCTAD IV, even
though many of the problem; mentioned earlier precluded a full
exchange of views. We believe that extensive consultations with con-
gressional advisers before and during such conferences is most impor-
tant, andl strongly urge that such consultations not only be continued
but substantially expanded. The advisers and staff designated by them
should have full access to instructions., cable traffic, and delegation
meetings- concerning the conference. In general, UNCTAD IV repre-
sente(di substantial progress in the process of Executive-Congressional
consultation which began with the U.N. Seventh Special Session.
It is important that what forward movement occurred at UNCTAD
IV be nlmaintained by the United States. The discussion of many of the
issues l)efore the UNCTAD IV conference e will be continued at the
(11EC meetings in Paris. The results of UNCTAD IV included de-
cisions to proceed with preparatory conferences on commodities
aiind the common fund. The United( States should begin at the earliest
monient to plan a consolidated, positive response to the UNCTAD IV
conference lpropt,.ials, and to work with other members of the Group B
'countries to insure that progress toward this position is not inhibited
because of lack of communication. The United States should now take
a1 11111 (1 m(ore careful look at each commodity to determine whether
oir interest in the long ternt will be served by specific commniodit"
agre(1erients. Especially in the case of thle common fund, which appears
to Ib, ol its wNy to creaLtion in so0111( form, the Unitedp(l States has, a
l)lic .choice over whether to take a passive app)l)roach and let those
c1omm1itted to hlie coilniofl funi(d construct I all mtechlianism unfavorable
to U. .S. interests, with tle hlope that it will be weak or ineffective; (1r,
pur~]sue more 2c tie course wlichl could recognize thlie existence of the
find id help mold it to deal with U.S. concerns.













APPENDIX A



MANILA DECLARATION AND PROGRAM OF ACTION


77 AM(III)/49
page 1


CONTENTS


Part One: Declaration


Part Two: Progranme
Section One:
Section Two:
Section Three:
Section Four:


Section
Section


Five:
Six:


Section -even:

Section Eight:

Section Nine:


of Action
Commodities
Manufactures and semi-manufactures
Multilateral trade negotiations
Money and finance and the transfer
of real resources for development
Transfer of technology
Least developed emong the developing
countries, developing island countries,
and developing land-locked countries
Economic co-operation among
developing countries
Trade relations among countries having
liffcrent economic and social systems
Review of institutional arrangements in
UNCT/AD


Annex I Resolutions and decisions adopted by the


Annex II


Third Ministerial Meeting of the Group of 77
Organizational and other matters


(9)


74-033 0 76 2







10



77-1M( 11I)/49
page 2



PART ONE

DECLARATION
I

Guided by our common aspirations, we, the representatives of the
developing countries, having met at the Third Ministerial Meeting of the
Group of 77, held in the city of Manila, Philippines, to co-ordinate and
harmonize our positions in preparation for the fourth session of the
United Nations Conference on Trade and Development, to be held at Nairobi
in May 1976,
Having considered the Declaration of the Fourth Conference of Trade
Ministers of OAU Member Countries, the First Declaration and Action
Guidelines of the Latin American Council of the Latin American Economic
System (SELA) nt\ the Jakarta Declaration 1976,
Inspired by the illuminating opening address delivered by
His Excellency the President of the Republic of the Philippines,
Mr. Ferdinand E. Marcos, who expressed fruitful ideas which made a
significant contribution to our discussions and reflect a keen analysis
of the present state of international economic relations and an
outstanding perceptivcncss of the unfavourable economic and social
conditions under which our peoples are struggling,
Cordially th nk the Government and t,,e people of the Philippines
for their warm hospitality and for the efficient organization of this
Meeting, which has enabled us to conclude the Ministerial Meeting
successfully.











77 A" 111) /9
page 3
II
The Ministers nf th.' Group of 77
at their Third Heetine hell at Minila from 2 to 7 Pcbruary 1976,
Having examnii in d&pth the economic situation of the d-leveloping
countries and h.ving review' the policies pursued and the results obtained
since the adoption of the International Development Strategy and the
third session of UNCTAD In the field of trade, international economic relations
and development in the light of the Declaration and Prograe of Action on the
Establishment of a New International Economic Order and the. Charter of
Economic Rig.hts ane' Duties of Stntcs,
Inspired by the Charter of Algicr.s and the Lima Declaration of the
Group of /7,
jearing in mind the Declaration ane Programme of Action adopted at the
Fourth Conference of Heads of -tate or Government of Non-Aligned Countries,
Noting with deep disappointment that very fet- concrete results have
been obtained in those fields, that the developed countries have generally
not implemented the policy measures and fulfilled the commitments undertaken
designed to improve the situation of the developing countries, and that the
relative position of the developing countries in the world economy especially
the position of the least developed, land-locked and island developing
countries and the most seriously affected developing countries has
worsened during this period,
Declare thnt international economic conditions particularly world
inflation, monetary disorders, recession in the highly industrialized regions,
the appearance of new forms of economic discrimination and coercion, certain
forms of action by transnational corporations and the revival of protectionist
trends in the developed countries have seriously affected the economies of
all developing' countries,
Recognize that, in view cf this situation, some developing countries have
made and continue to make major efforts to provide other developing countries
with financial and other assistance to help them overcome their economic
difficulties, including their food and energy problems, and hope that such
initiatives will encourage further assistance in these fields by those
countries which are in a position to do so.







12


77 )g4((III) /iA'
,)age' 4



Deplore the application by the developed countries of unjust and
discriminatory trade rLRjuItions, and the obstacles which they impose on
developing countries in regar' to access to modern technology;
Affirm their conviction that it is necessary and urgent to bring about
radical changes in economic relations in order to establish new relations
based on Justice tn-1 equity which will eliminate the inequitable economic
structures imposed on thec developing countries, principally through the
exploitation and marketing rf their natural resources and wealth; '
Esphasise the close solidarity of all the developing countries which
has made It possible for them to evolve a unified position, as well as the
importance of harmonizing positions which help to enhance the irreversible
process they have created in international economic relations and to
consolidate and-strengthen their unity and solidarity through joint
concerte'action, thus laying the foundation for the new international
economic order and for the -doption of the Charter of Economic Rights
and Duties.of States;
.Affirm that the current situation presents a favourable opportunity for
thO international community to take steps -and reach agreements at the fourth
scsnion of the United Notions Conference on Trade and Development aimed at
solving the economic and financial problems of the developing countries and
achieving the objectives of the new international economic order;
Pecide to pr-note the urgent imaplenc.itatinn, on the basis of a
programme of concerte.l action, of the new international economic order
withinn the framework of the Declaration and the Programmen of Action on the
Zstablishment of a New Internrtional Economic Order, the Charter of Economic
lipphts and Dutic, of Statt s -n,' the decisions nnd recommendations adopted by
the General Assembly at its seventh special session;
reaffirm their conviction that the implementation of the new
international economic order is essential for the promotion of justice
'rnd the maintenance of peace and international co-existence, owing to the
ever-increasing interdependcncL of nations and peoples;
Reaffirm further thvir conviction that responsibility for achieving
economic development an,! ensurivA social' justice lies in the first instance
with countries thrr-.rlves and that the achievement of national, regional
and international objectives repun's on the efforts of each individual
country. As a necessary coroll.:ry to those national efforts and in







13



77A" (ll)/49
page 5


accordance with the principle of collective self-reliance, they urge the need
for closer and more effective co-operation among the developing countries,
including the harmonization and c3-ordination of their respective economic
policies;
Declare once again that international economic relations should be based
on full respect for the principles of equality among States, and
non-intervention in internal affairs, on respect for different economic and
social systems and on the right of each State to exercise full and permanent
sovereignty over its natural resources and all its economic activities;
Resolve that the developing countries should be assured wider and
increasing participation in the process of adoption and in the adoption of
decisions in all areas concerning the future of international economic
relations and in the benefits derived from the development of the world!
economy;
Reiterate the need and urgency for the principle of differential and
preferential treatment in favour of developing countries to be applied in.
accordance with specific and effective formulae in all fields of their
economic relations with developed countries;
Reaffirm the importance of international co-operation for the
establishment of the new international economic order;
Accordingly,
DECLARE
their firm conviction to make full. usc of the bargaining power of the
developing countries, through joint and united action in the formulation of
unified and clearly defined positions, with a view to achieving, inter alia,
the following; objectives in the various fields of international economic
co-operation:
1. Restructuring international trade in commodities so that it offers
a viable solution to the problems concerning commodities, to raise and
maintain the value of the exports and the export earnings of the developing
countries, increasing processing and improving the terms of trade of
those countries. Bearing these fundamental objectives in mind, the fourth
session of UNCTAD should take concrete and operational decisions concerning
the integrated pr-granmmec and all its elements and the implementation of each
of its objectives and each necessary international measures, including the
negotiating plan:







14


77AN(Trn)/49
pane 6


2. rfcshap!nR of the structure of world industrial production and trade
to ensure a substnnti.l increase in the share of the devclopinc countries in
worle exports of ;nufacturcs anl! semi-mon-ufacturcs, in ncccrdancc with the
goals set forth, irt KrJilr in the Lima Declaration and Plan of Action
on Industrial Development Pnd Co-operation. T-' this en', suitable internal and
external conditions, including; new forms and areas of industrial co-operation,
must be created for accelerated industrial developmentt and for prrwoting the
export of manufactures ant' semi-manufactures from I.levelopinr countries, withoutt
oivin" rise to restriction3 on their access to the markets of developed countries;
3. Exp.nndin,' the tital export capacity of the c'eveloping countries,
4n Lerms boti of volmac an., of the diversification i-f their products, and thus
pr-imoting the increasing participation of those countries in world trade-
4. Achiecvin?. substantive results for the developing countries in the
multilateral trp',e nco:otiations and additional benefits through the adoption
of cifferentiel measures .ind special -rocedures for them in all areas of the
negotiations. Pr,'in:, tht completion of those negotiatiOns, ensuring that the
developed countries strictly observe the standstill with regard to their
imports from thu :levelipinc. countries. In this context, suhstantial improvements
should be made in the cxistin. GSP schemes to help developing countries to
achieve the aRrccd objectives of the GSP;
5. Condenming and rejecting all forms of discrimination threats or
coercive economic policies nnd practices, either direct or indirect, against
individual or groups of developing countries by developed countries, which are
contrary to funramcntl principles of international economic relations:
6..- Urgently ,chicving P reform of the international monetary system
which will meet the interests end needs of the developing countries, with the
full and cffectivc participation of those countries in the t'ecision-making
process involved in that reform-
7. Sccurinr. short-term and lon.'-termi financinL in sufficient volume
and on favourable terms and accelerating the flow of bil.tc..ral ,n:-1 multilateral
financial assistance from the developed to all the developing countries, and
in particular to the least Ievc.lopcd, land-locked and island developing
countries and the most seriously affected countries, on a more continuous,
assured and stable basis, in order Lhat the target for ofUicial development







15



77 H(1II)/49
pa.!c 7


nssist:ncc is reached without delay moreover, access of developing countries
to the capital markets of dcvlo70eu countries should be substantially increased;
G, Taking i,,anedi.te steps by devclopoJ& countries n.-l' international
organizations to allcvite the increasing debt probleris of developing
countrtcr and to exand and improve short-term financing facilities to
mitigate their bilaznce-of-payments difficulties:
n. "romotin, national technological progrcsn through the acquisition,
development, adaptation an(' ,isseminatlon of technology in accordance with
the neecds, intcre.As .ndl priorition of the developing countries, nnd ensurin.r
the transfer ulf technology on international conditions consistent with those
objectives, with n view to strengthcnin-, the technological capabilities of
Aevelopinr,. countries and thus reducing their dependency in this field, through
appropriate institutional arrangements, the adoption of a multilaterally
binding code of conduct on the transfer of technology and. the review and
revision of international conventions on patents and trademarks,
10. Ensuring that the activities of transnational corporations operating
in territories of developing countries arc compatible with their objectives
of national d(levelopment, through the ;.ree exercise of the right to regulate
the operations of those corporations, and promoting international co-oicration
as an effective instrument for achieving that objective.
11. Promotion r.n.' fostering a programme of economic c'-operation a-iong
developing countries through suitable permanent machinery for strengthening
their mutual c--,,pcratioT1 and making possible the adoption of concrete
measures in thin various fields of their economic relations, in order to
promote the individual and collective self-reliance, interdependence an'
progress of the developing countries-
12. Devoting efforts toiTare's urgent action for the expansion of trade
between the dcvelopinr, countries and1 develoned countries with centrally
planned economies, including suitable inst-tutional z-rranements for r'ealinr
with this issue, "ith o view to increasing the economic benefits accrnin,; to
developin- countries from such trade and economic co-operation;







16



77At( Ii) /A)
page 8


13. Establishing more effective and realistic measures and policies
through suitable mechanisms in fn'-ur of the least developed, land-locked
and island devclc in, countries an4 impic icnting them as sp.edily as possible,
so that their results may help to alleviate or diminish the specific and
long-existing problems affecting tho.e countries;
14. Implementing without delay effective measures in favnur of the most
seriously affected developing countries to enable them to overcome their
special problems, In accordance with General Assembly resolutions 3201 (S-VI)
and 3202 (S-VI);
15. Furthering co-operation in the solution of arenr sad urgent
international economic problems affecting a large number of developing
countries;
16. Continuinr and intensifylng their efforts to affect the changes
urgently needed in the structure of world food production nind taking
appropriate steps, particularly in the field of trade, to ensure en increase
in agricultural production, especially of foodstuffs, and In the real
income which the dcvelopinr countries obtain from exports of these products.
Developed countries ani. developing countries in a position to do so should
provide food grains and financial assistance on most favourable terms
to the most seriously affected countries, tc enable them to meet their
food and agricultural development requirements;
17. Strengthening the negotiation function of UNCTAD so that it could
evolve into an effective nceotirtinf arm of the United Nations in the fields
of tradc and dcvuloprmnent capnble of translating principles and pclicy
guidelines, particularly those enunciated by the General Assembly, into
concrete agreements an' thus directlyy contribute to the establishment of
the new international economic order.







17


77/MI'Ul)/49
page 9


PART T'0

PROGRAM OF ACTION

Section One
CO4MMODITIES

Action on commodities. including decisions on an integrated progra.o in
the light of the ncUe for change in the world commodity cony
1. The present situation of conmodities contains a number of new factors
which could form the basis for n fresh initiative that would contribute to
the establishment of a new international economic order, including the
setting up of new production and market structures for commodities.
Concerted efforts should therefore be made to restructure the world colbodity
economy in order to improve the terms of trade of developing countries,
expand their export earnings from commodities in their raw and processed
forms, and eliminate the economic imbalance between developed and developing
countries. With this basic aim in mind, UNCTAD IV should adopt decisions on
the objectives, commodities to be covered, international measures and
negotiating plan of the integrated programme for cocmodities of export
interest to developing countries, including perishables, and a time-table
for its implementation.
2. "The solution to world food problems lies primarily in increasing
rapidly food production in the developing countries. To tH.s end, urgent
and necessary changes in the pattern of world food production should. be
introduced and trade policy measures should be implemented, in order to
obtain a notable increase in agricultural production and the export earnings
of developing countries. To achieve these objectives, it is essential that
developed countries and developing countries in a position to do so should
substantially increase the volume of assistance to developing countries for
agriculture and food production, and that developed countries should
effectively facilitate access to their markets for food and agricultural
products of export interest to developing countries, both in raw and
processed form, and adopt adjustment measures, where necessary."-/



_/ General Assembly resolution 3362 (S-VII), sect. V, paras. 1-2.







18


77/W(III)/49
page 10

3. The integrated pro'.rmmn for coinodties is a programme of global. Ucti,'.
designed to improve and establish new structures in international trnde in
comnodlties of interest to thL developing countries. The integratcd
programme does not prccludL other trade and financial measures and mechanism
relating to products, gr-up5 ot products or sectors from contributing towards
the achievement of the same objectives. In emergency situations of market
disruption, trade and financial measure should be taken so as not to
adversely affect trade flows from developing to developed countries.
A. Obtectvas .of thie Dro.raunm.
4. The objectives of the Integrated programme are:
(a) Improvement of the tcrms of trade of the developing countries in
the field of commodities;
(b) Supporting commodity prices at levels which in real terms are
remunerative and Just to producers and equitable to consumers,
taking full account of the rate of world inflation and fluctuations
in the exchange rates of the main currencies;
(c) Reduction of excessive fluctuations in commodity prices and
supplies in the interests of both producers and consumers;
(d) Improving and stabilizing in real terms the purchasing power of
the export earnings of individual developing countries;
(e) Expansion of developing country exports of primary and processed
products, improvement of the competitiveness of natural products
vis-a-vis synthetic substitutes and harmonization of the production
of synthetics and substitutes in developed countries with the
supply of natural products produced in developing countries;
(f) Diversification of production, including food production, and
expansion of the processing of primary commodities in developing
countries with a view to promoting their industrialization. and
increasing their export earnings;
(g) Assurance of access to markets of developed countries for exports
from developing countries;
(h) Increasing thr participation of developing countries in the
transport, markctinL ,-nd distribution of their exports and their
share in the earnings therefrom.







19



77/MM(111)/49
page II


B. Intcrrunjtiuii inLa.urLs of the prodramnmc
5. To achieve the objectives of the integrated programme all the following
international measures, each one of which constitutes an important and
integral element of thV progranmme, should be taken:
(a) Establishment of n common fund for the financing of international
commodity stocks or other necessary measures within the framework
of commodity arrangements;
(b) Setting up At international commodity stocking arrangements;
(c) Harmonizatior of stocking policies and the setting up of
co-ordinated national stocks financed, in the case of developing
countries, by the common fund referred to in sub-paragraph (a)
above. or by international financial agencies through a broader
and more liberal financing scheme for buffer stocks;
(d) Negotiation of other measures necessary for the attainment of the
objectives of the programme within the framework of international
commodity arrangements through, inter alia, appropriate international
production policies, supply management measures, and bilateral and
multilateral long-term supply and purchase commitments, taking into
account the characteristics of each product;
(e) Effective application of appropriate measures and procedures for
indexing th- price of commodities exported by developing countries
to the prices of manufactures imported from developed countries;
(f) Improvemr.nt and enlargemnznt -of compensatory financing facilities
for the stabilization in real terms around a growing trend of
export earnings of developing countries;
(g) Promotion and support of processing and diversification activities
in developing countries, anz also liberalization and improvement of
access to markets of the developed countries for developing country
exports of primary and processed commodities;
(h) Appropriate measures for greater participation by developing
countries and for improving their share in the transport, marketing
and distribution of commodities of export interest to developing
countries in their raw as well as processed forms, including the
establishment of financial, exchange and other institutions for the
remunerative ..3nagLment of trade transactions, and also consequent
actions by dcvcoped countries.







20



77/MM(1Ii),.V-9
pagne 12


6. The intcrcsLs Jf dv,.lopin- importing countries, pirticulnrly rl. Least
developed and the most seriously affected among them, adversely aff:ctcd by
measures under t,.c int -rntd pr.:rammiB: should bv protuctei by means of
appropriat- difierentill and rcmcdial measures within the programme.
7. The product covurci,' of the integrated programme should take into account
the fundamental intcrLvsts -f dvvcloping countries in, among others, bananas,
bauxite, cocoa, coffee, copper, cotton and cotton yarn, hard fibres, iron ore,
jute and Jute products, manganese, neat, phosphate, rrbbcr, sugar, tea,
timber, tin ind vLpctablL oils, including olive oil end oilseeds.
8. Efforts on specific measures for reaching agreements on products, groups
of products or 3cctors which fur various reasons are not incorporated in the
first stage of application of thL integrated programme should be continued.
9. The application of Any of the measures which may concern existing
international arrangements on commodities covered by the integrated programme
would be decided by .overnmcnts within thc commodity organizations concerned.
10. The measures envisagicd above could be reinforced by stimulation and
promotion of action by producers' associations and by adoption of measures
designed to promote and increase trade in commodities among developing
countries.
11. In relation to compensatory financing, agreement should be reached at
UNCTAD IV on recommendations to the IMF regarding improvements of its
compensatory financing facility alon', the following lines:
(a) An casing of the hniancc-of-npy.nents criterion for assistance to
developing countries;
(b) CIctilntion )f cxort shortfalls in terms of the real value
(import purchasing power) of exports and an element of growth in
real trmas;
(c) Provision to developing countries of a right to base claims for
compensation on sh,)rtfalls in their aggregate commodity export
earnings or their total export eArnings;
(d) Easing of rvp.nym&*nt terms and expansion of the grant element in
compensatory financing, particularly for the poorest developing
countries.










77/MK(II)/"
page 13


12. Agreement should be reached at UNCTAD IV on recmmensdatiouns relating to
improved access to markets of developed countries for developing coUnty
exports of primary and processed cmmoidlties, soe of which may be incorporated
into individual commodity arranganmqta under the integrated profaim-e.
C. Negotiating plan of the proarmme
13. In the light of the decisions reached oa the objectives and intematiomal
measures in the integrated progrime, agreat shabould be reached at UCTAD IV
on follow-up procedures for the implemmetatioe of the integrated program,
including the following:
(a) Establishment within UNCTAD of an ad hoc intergovermental group for
the negotiation of the common financing fund referred to in
paragraph 5 (a) above;
(b) Convening of intergovernmental preparatory meetings and negotiating
conferences for the negotiation of international arrangements;
(c) The possible establishment within UNCTAD of an ad hoc
intergovernmental co-ordinating comiftee of the Trade and
Development Board for commodity negotiations to give impetus to the
negotiations referred to in sub-paragraphs (a) and (b) above, to
review the progress and to deal with such major policy problems as
may arise during the negotiations.
14. Agreement should also be reached on a time-table for the impleamentation
of the integrated programme.
Section Two
MANUFACTURES AND SEMI-MANUFACTURES
Agreement should be reached at UNCTAD IV on a comprehensive strategy to
expand and diversify the export trade of the developing countries in
manufactures and semi-manufactures, with a view to the attaiment of the goals
for their accelerated industrial development including those set by the Second
General Conference of UNIDO at Lima. Such a strategy should comprise
inter alia the following measures:
I. Improving access to markets in developed market economy Countries
and the socialist countries of Eastern Europe for manufactures
and semi-manufactures of developing countries
(a) The generalized system of non-reciprocal, non-discriminatory
preferences should be improved in favour of the developing
countries through the adoption inter alia of the following







22


77/W1(11')/49
page 14



measures, taking into account the relevant Interests of those
developing countries enjoying special advantages as well as the
need for finding ways and means for protecting their interests:
(1) extension of its coverage to all products of export interest
to developing countries;
(Hi) unrestricted, duty-free and quota-free entry for imports of
all products covered;
(iII) liberalization, simplification and harmonization of rules of
origin in order to promote and not to hinder the exports of
developing countries. The developing countries should be
treated under the GSP rules of origin as one area, i.e. there
should be "cumulative treatment";
(iv) removal of all the discriminatory and restrictive aspects of
the schemes, especially that of the United States;
(v) elimination of any other internal fiscal or pars fiscal
barriers to trade.
(b) Developed countries should apply the principle of generalized
preferential treatment in favour of developing countries to
non-tariff barriers, including their elimination, and to other
trade policy measures.
(te) The socialist countries of Eastern Europe should not link the
application of their schemes-or other equivalent measures to
bilateral long-term contracts or arrangements with the beneficiary
countries.
(d) Developed countries should adhere strictly to their commitments
to the principle of standstill as regards restrictions on Imports
from developing countries.
(e) It is necessary to avoid the prolongation and multiplication of
international arrangements designed to validate arrangements
requiring developing-countries to "voluntarily" restrain their
exports, as is the case in the Arrangement regarding
International Trade in Textiles.







23


77/N1(III)/49
page 15


(f) The GSP should be given a firm statutory basis and made a permanent
feature of the trade policies of the developed market economy
countries and of the socialist countries of Eastern Europe.
(g) No instrument of economic policy, particularly the GSP, should be
used as an instrument of political or economic coercion or of
retaliation against developing countries, including those that
have adopted or may adopt, singly or Jointly, policies aimed at
safeguarding their natural resources.
(h) The export products, including unprocessed and semi-processed
products included in BTh chapters 1 24, of developing countries
that can be distinguished from similar products of developed
countries should be identified and separately classified in
developed countries customs tariffs in order to allow more
favourable treatment.
(1) The developed countries should adopt appropriate internal
adjustment assistance measures for their industrial restructuring
with the object of allowing for an increasing volume of imports of
manufactures and semi-manufactures from developing countries.
II. Restrictive business practices
(a) Agreement should be reached on concrete measures for the
implementation of relevant resolutions adopted by the international
conmunity, relating to restrictive business practices, particularly
provisions contained in General Assembly resolution 3362 (S-VII)
on development and international economic co-operation, which
provides that "Restrictive business practices adversely affecting
international trade, particularly that of developing countries,
should be eliminated and efforts should be made at the national and
international levels with the objectives of negotiating a set of
equitable principles and rules".
(b) Action should be taken by developed countries aimed at improving
the control of restrictive business practices adversely affecting
the trade of developing countries, including the institution of
appropriate notification and registration procedures, as well as
the development, where necessary, of policies for the elimination
of restrictive business practices.







24


77/K (i IH)-.
page 16


(c) Action should he taken at the international level withi.. thL
framework ot fr'.i/t, including the following elements:
(i) Agreement on the need to negotiate for the purpose* of -Jopting
a set of equitable principles and rules governing the mtrol
of restrictive business practices adversely affecting
international trade, particularly that of the developing
countries;
(ii) Continued examination of the various restrictive business
practices adversely affecting the trade and development of
developing countries and measures necessary to control such
practices;
(iii) Supply of information by developed countries on restrictive
business practices adversely affecting the trade and
development of developing countries;
(iv) Collection and dissemination of information on restrictive
business practices by the UNCTAD secretariat, in close
co-operation with the Research and Information Centre on
Transnational Corporations established at the United Nations;
(v) Provision of technical assistance to developing countries in
the area of restrictive business practices, especially in
respect of the training of officials.
III.Transnational corporations and the expansion of exports of manufactures
by developing countries
Agreement should be reached on:
(a) Measures to be taken at national, regional and international levels
in order to ensure that transnational corporations reorient their
activities towards more complete manufacturing in developing countries
and towards the further processing therein of raw materials for both
the domestic and foreign markets. The developed countries should
take steps to adjust their policies, particularly in the field of
tariff and non-tariff protection, foreign exchange regulations,
foreign investment and fiscal and financial incentives, to facilitate
the above-mentioned measures to be adopted by the transnational
corporations.











77/4N(Ul)/49
page 17


(b) Measures to strengthen the participation of national" nterprisa of
developing countries in the activities undertaken by transnational
corporations in their territories, particularly those relating to
the export of manufactures and semi-maMnufactures.
(c) Equitable principles and rules to govern the control of restrictive
business practices which include measures for the control of the
practices of transnational corporations adversely affecting the
developing countries' ability to export manufactures and
semi-manufactures.
(d) Measures designed to ensure the regulation and control of the
activities of transnati6osal corporations in order that they may be
a positive factor in the export efforts of developing countries, so
that the latter may acquire greater control over the processing,
marketing and distribution of their manufactures and semi-manufactures.
IV. Export and industrial financing
(a) Developed countries should assist developing countries in setting
up financial institutions required by them for development and
promotion of their industries and exports.
(b) International financing institutions should grant programme loans
to industrial sectors in addition to the project loans, as well
as provide medium- and long-term refinancing facilities for the
exports of developing countries.
(c) International private investment and the financing thereof should
be adapted to the industrial needs of the developing countries, in
accordance with their national legislation and policies.
(d) Developed countries should make available, through bilateral and
multilateral channels, larger amounts of financial aid to assist
the industrialization of the developing countries, commensurate
with and suited to achieving the 25 per cent share for these
countries in world industrial output by the year 2000 as set out in
the Lima Declaration and Plan of Action.


74-033 0 76 3







26



77/M4(111)/49
page 18


V. International co-opcration for industrial restructuring,
Agreement &I. uld be reached oin measures to be taken In the field of trade
in manufactures and semi-manufactures with a view to the achievement of.the
goals for international industrial restructuring contained in the Declaration
and the Programue of Action on the Establishment of a New International
Economic Order, adopted .t the sixth special session of the General Assembly,
in the Lima Declaration an- Plan of Iction on Industrial Development and
Co-operation and further stressed in General Assembly resolution 3363 (S-VII).
Such measures should include:
(a) Early implementation of the decision to establish a system of
consultations at global, regional interregional and seotaral
levels within appropriate international bodies, in order to
facilitate the achievement of the afore-mentioned goals; and
effective participation of UNCT/AD in such a system.
(b) Action for .trengthening the promotion in developing .countries of
the production and trade of manufactures and semi-manufactures, .,
including those involving the ,se of advanced technology in their
production. Such action should include the elaboration of
guidelines on the fo11owing:
(i) identification of industrial ,activities that could be the
subject of industrial collaboration arrangements;
(ii) way-% of prn-1't~aig Industrinl collaboration arrangements in
their various foims;
(iii) reJepluyaent of industri-s from Aeveloped to developing
countries;
(iv) supporting .neanures in developed countries including;
aJjustmennt assistance measures designed to increase imports
from d&velopin6 countries partictiirly in sectors where the
competitive advantage lies with developing countries;
(v) commercial co-operation between developing and developed
countries *,nd aniong developing& countries, aimed at facilitating
the operation of the proposed arrangements;
(vi) financial and technical co-operation, including appropriate
assistance from international institutions;







27


77/i( III)/49
page 19


(vii) harmonization of the production of synthetics and substitutes
in developed countries %'Lth the supply of naturall products
produced in developing countries;
(viii) supporting measures to be taken by the developing comtitles
for the above, taking into account the need for protecting
their nascent industries.
(c) Strengthening of co-operation between UNCTAD and;UNIDO on thi above
matters.
Section Three "
MULTILATERAL TRADE NEGOTIATIONS
1. Developing countries stress the importance of the comitaents made in the
Tokyo Declaration to inter alia secure additional benefits for the
international trade of the developing countries and the importance of
implementing them fully on a priority basis. They reaffirm the need for
observing the multilateral character given to the trade negotiations and
for ensuring their "transparency".
2. The Ministers at Tokyo had intended that the ITNs would be concluded in
1975. This target date has not been realized. The developing countries
reiterate their greet disappointment over the slow progress of the trade
negotiations and, bearing in mind the decision of the TNC to complete the
negotiations in 1977, urge inxunediate action on their specific requests and
proposals in aieas of special priority by the middle of 1976 and.the
implementation of the agreed concessions from 1 January 1977.
3. Developing countries express concern that the fundamental principles of
the Tokyo Declaration in their favour have not yet been complied with.
4. Developed countries should secure, where necessary, additional
legislative and other authority and complete their procedures to implement
the concessions and commitments undertaken by them in the lMTNs in favour of
the developing countries.
5. Developing countries attach particular importance to the following major
principles in the trade negotiations between developed and developing
countries:







28


77/t4M(III)/<'-
page 20


(a) Strict adherence, to the principle of non-recipnrclty. The questice
of the contribution of the developing countries to th, over-all
objectives of the negotiations consistent with their trade,
development and financial needs should not be considered until the
objectives and commitments of the Tokyo Declaration in their
favour are adequately fulfilled;
(b) The concrete application of differential measures which would
provide special and more favourable treatment for developing
countries, including advance implementation of concessions1
(c) The binding of commitments end concessions in the negotiations
,. in favour of developing countries;
(d) Adoption of special procedures for developing countries in all
areas of the negotiations;
(e) Special treatment to be extended to the least developed among the
developing countries in the context of any general or special
measures that may be taken in favour of the developing countries
during the negotiations.
6. Developing countries urge that the following specific issues of major
concern to them be given immediate consideration:
(a) Strict adherence to the standstill;
(b) Special priority in the scope and content of concessions for
tropical products should be assured at the earliest possible date
in accordance with paragraph 2 above;
(c) The binding .n GATT of preferential tariff margins;
(d) The maintenance and improvement of the GSP and effective
compensation in case of the erosion of preferential margins
resulting from the MFN tariff cuts;
(e) Immediate elimination or liberalization of quantitative restrictions
and other non-tariff barriers affecting exports of developing
countries. Quantitative restrictions inconsistent with the
provisions of the GATT applied by the developed countries should
be eliminated without any delay;







29


77A4(I11)/49
page 21



(f) Recogniti.on of the right of developing countries to acrord export
subsidies in tlhe context of their development and industrialization
policies Without..giving rise to the applicat1Qn of countervailing
duties; .
(g) Exemptton of the developing countries, in principle, from the
application of safeguard measures;
(h) Provision for differential treatment for, and deferred compliance
by, developing countries, with the provisions of the codes being
elaborated in the multilateral trade ne&otlations;
(1) Iore favourable treatment in the application of government
procurement policies in favour of developing countries as compared
with developed countries. Developed countries should give to
developing country. suppliers treatment no less favourable than they
accord to their domestic suppliers in the field of government
procurement.
7. In accordance with the Tokyo Declaration, inmmerdiate consideration should
be given to reforming the provisions of GtOTT, including part IV, in order
to provide on a mandatory basis for differentiaLed and more favourable
i
treatment to developing countries, and for extension of these principles to
the existing -odes rn'1 those that may be drawn rtp.
8. The Trade and Development Board and its subsidiary bodies concerned
shouldd follow closely the Cevelopments in, and give active consideration to,
the issues in the negotiations of particular concern to the developing
countries. UNCTAD shouldd prymcte consultations ind exchanges of views
among developing countries, For this purpose, satisfactory arrangements
should be made for cffectlva participation by the Secretaryv--GCneral of UNCTAD
in these negotiations and he ALould be provided with adequate resources to
fulfil, this task.







30


77/ M(II I)/49
page 22


Section Four

KONEY ANt FINANCE AND THE TANSF.R OF REAL RESOURCL. FOR DEIV.LOPMENT

I. Measures to be taken by developed countries and international
organizations to resolve and alleviate the critical debt problems of
developing countries
1. Heavy debt-service payments, current account deficits steaming from
maladjustments in the world economy, inadequate balance-of-payments support
and long-term development assistance, coupled with tight conditions and the
high cost of loans in international capital markets and difficulties of
access to markets in developed countries for exports of developing countries,
have all combined to impose a serious and critical strain on the import
capacity and reserves of developing countries, thus jeopardizing their
development process. The deterioration in the terms of trade of
developing countries and the high-cost short-term borrowing they have had
to resort to recently have seriously aggravated their debt burden. This
situation facing the developing countries can be mitigated by decisive and
urgent relief measures in respect of both their official and commercial debts.
2. In negotiations on debt, UNCTAD IV should take as a general framework
the draft resolution of the Group of 77 presented at the seventh session of
the Comiittee on Invisibles and Financing related to Trade (TD/B/C.3/L.107).
Official debts
3. Debt relief should he provided by bilateral creditors and donors in the
form of waivers or postponement of interest payments and/or amortization,
cancellation of principal, etc. of official debt to developing countries
seeking such relief. In that framework the least developed, the developing
land-locked and the developing island countries should have their official
debts cancelled. Other most seriously affected countries should receive
the same treatment or, as a minimum, have their debt-service payments on
official debts waived until they cease to be regarded by the United Nations
as most seriously affected countries.
4. Multilateral development finance institutions should provide programme
assistance to each developing country in an amount no less than its debt
service payments to these institutions.







31


77/?t1(11)/149
2age 23


Comercial debts
5. Agreement should be reached to consolidate the commercial deLs of
interested developing countries and to reschedule payments over a period of
at least 25 years. The consolidation of commercial debts and the rescheduling
of payments would require the establishment cf suitable financial arrangements
or machinery, which might include, inter alia, a multilateral financial
institution, such as a fund or a bank, designed to fund the short-term debts
of interested developing countries.
Debtor/creditor conference
6. A conference of major developed creditor and interested debtor countries
should be convened under the auspices of UNCTAD in 1976, to determine
appropriate ways of implementing the principles and guidelines on the
renegotiation of official and commercial debts to be reached at UNCTAD IV.
II. Measures to increase net capital flows to developing countries to meet
their long-term external financing needs
7. Assistance from developed countries constitutes an indispensable
complement to the internal efforts of developing countries, which are
concerned at the fact that developed countries are continuing to maintain
qualifications on their obligations under the International Development
Strategy and to impose conditions on their assistance. La agreed by the
General Assembly, in its resolution 3362 (S-VII), concessionall financial
resources to developing countries need tc be increased substantially, their
terms and conditions ameliorated and their flow made predictable, continuous
and increasingly assure, so as to facilitate the implementation by
developing countries of long-term programmes for economic and social
development. Financial assistance should, as a general rule, be untied".
A. The 0.7 per cent for official development assistance (ODA)
8. (a) All developed countries should effectively increase their ODA so
as to achieve the 0.7 per cent ODA target as soon as possible, and
in nny case no later than 1980. To achieve this end and to ensure
that ODW flows are predictable, continuous and assured, the
following measures, inter alia could be considered:







32


77'/H(III)/49
page 24


(i) Introduc o'., uy developed countries of a develop tnt tax as
a means of raising: the required revenues, therch/ avoiding
discontinuity in appropriation by legislatures;
(ii| Use by Lhe developed countries of the interest subsidy
technique as o means of minimizing the budgetary burden of
achieving thc 0.7 percent target and of generating a large
expansion of concessioPal flows in a short span of time.
(b) For the purpose of the attainment of the 0.7 per cent ODA target
by developed countries, it should be agreed th4ti
(1) ODA loans should be measured net of smortiaation and
interest payments;
(1i) At least 90 per cent of ODA flows should be in the form of
grants or loans on IDA terms;
(iii) Official loans with a grant element of less than 50 per cent
should not be treated as development assistance; .
(iv) ODA loans should be untied and multilateral agreement should
he sought as soon as possible for the untying of all official
flows. Grants should also be untied as far as is feasible;
(v) Financial flows to areas which the developed countries
themselves do not regard as sovereign political entities
should be set aside in measuring countries' performance under
t e target;
(vi) ODA should be increasingly given in the form of non-project
and progratfne assistance, including local currency financing;
(c) The 0.7 per cent ODM. target should be treated as the actual
financial flow target, and the 1 per 7ent target (in the
measurement of vhich_*ther.official and private capital flows
are included) should be considered as merely a broad indicator
of financial co-operation.







33


77AI( III)/49
page 25


(d) ODA should be distributed more rationally and equitably among all
developing countries without prejudice to existir; bilateral or
multilateral agreements between developing and developed
countries, and the continuity of such financial flows should
be ensured on more favourable conditions.
B. Flows from multilatera4l devclopmnut. finance institutions
9. The multilateral development finance institutions should increase
substantially their lending to developing countries. To make this possible,
contributions of developed countries to these institutions should be increased
immediately. Contributions to the World Bank's Third Window should be
increased substantially and without prejudice tc the regular lending progranmme
of the IBRD, to IDA, and to the soft-loan windows of the regional banks.
10. Provision should be made for rcplenishinp the resources of IDA on a
continuous and automatic basis. The fifth and subsequent replenishments
of IDA should provide a substantial increase in the resources of IDA in real
terms. Negotiations should be completed in time to ensure continuity
of operations.
II. New sources of credit, additional to the existing ones, should be
created for the purpose of meeting the specific need of financing the
development programmes of developing countries which do not benefit from
the measures envisaged in paragraph 2 of resolution 62 (III).
C. Access to capital markets in developed countries
12. The developed countries should take irniediate measures to enhance the
access of developing countries to their money .ainil capital markets so as to
increase substantially the volume, improve the conditions and secure the
continuity of the resources available to the developing countries. Such
measures should include-
(a) Exemption of developing countries from various administrative
measures nvL rning the issues of foreign bonds in domestic
capital markets;
(b) A liberalization of statutory provisions limiting the extent
to which domestic financial inrtitutiJns can acquire debt of
developing countries' *.
(c) Exemption of 'cvcloping countries frcn general measures designed
to control capital outflows from capital exporting countries-







34


77AU4( I II) /4r.
page 21


(d) Ptruvtion by ,ovcr.,-.' ts, multil tcrnl f'o'>l :., to gu rantec financial rAliations
of dcvclopini c.antri,.
IIT. Mcasurcs to improve, nrn "pprtu.-iite .crms and conJitions, the financial
..11' ,..jntraiy situltij- .,f di-vclrpinr *.ounrrir.s, commensuratc with their
dcvcl-pment needs, .nd to ficiliLatc and improve the financing of their
exceptional deficits
13. Develupinc. countrie nurrally face chronic balancc-of-paymcnts deficits
but in recent yce.rs thc:t: ,cficits 'lave become critical for most of them,
threatening to ,underminer c L..:ir cvelopncent process. The present deficits are
cxccptiono1 not only In dimvr;sirn but in their source, since they result not
from inappropriate domestic polircis but largely from adverse world economic
conditions, in particular ro.cc.o,)n -nd inflation in developed countries;
these conditions havw furthci. weitkcnc.d the external position of developing
countries by worscninpv their tcri. s of tr.<,: and lowering, tlicir export voluine
and carninC5. The traditionc.l plltcy rcsponsec are therefore inappropriate
to deal with the situation and would serve to aggravate maladjustments in the
world economy, particularly those in developing countries. International
policies in the current situations must be tailored to these specific
characteristics of the situation in developing countries and reflect the
fact that their external *Ir.ficits are largely due to factors beyond their
control. TIiosv policies rmus;t thercfarc assure the orderly and adequate
financin,. --f the balance-of-paymcnts deficits of developing countries on
appropriate terms and conditions to allow the dcvelpin- countries to make
the necessary adjustment" without d.trimcnt to their development plans.
Existing IF policies, notwithstandinR recent welcome modifications, do
not suffi.e for this purpose.
14. The following actions, int.r lia, arc proposed to alleviate this
situation:
(a) The !'.F should rnnk if- policic- mmri( flcxibl.: as to provide
a-._qijate cn.,wn.r-txrm a'G.starcc Et lw interest rates and free of policy
conditions to dveloi)in, untrics for the qnccific purpose of compensating
them for shnrtfalls in ckx7rl rL .ings and risinG, prices for essential
imports rcsultin,, front tht -ecenwmic situation in the developed countries;







35


77"M(III)A/4
pav' 17



(b) The IF should undertake a further review of its conpcnsatory
financing facility in the near future in order to make the following changes:
(i) Export shortfalls should bi; calculated taking into account
changes in import prices and with due account for a growth
factor;
(ii) The quota limitations should be either abolished or raised
to a point at which they cover the entire shortfall;
(iMi) Repayments should be triggered only by "overagcs" just as
drawings are triggered by "shortfalls";
(iv) Countries should be given the choice of basing the calculation
of their shortfalls on their total LoMinodity earnings, or total
merchandise exports, or services, or on all current account
receipts, and to draw against the shortfall without basing
their claim entirely on balance-of-payments criteria;
(v) Increased import volume resulting from climatic or other
factors beyond the control of the country concerned should
also be included in the calculation of the shortfalls;
(vi) In appropriate cases, drawings under the facility should take
the form of grants.
(c) The IMF should undertake an early further review of its tranche
policies with a view to enlarging substantially the first credit tranche,
and reducing the conditionality attached to drawings under the subsequent
trenches.
15. Special measures should be taken within the framework of General Assembly
resolutions 3201 (S-VI) and 3202 (S-VI), to provide additional resources to
meet the exceptional balance-of-payments deficits of the most seriously
affected countries caused by the present crisis, and thereby enable them to
deal with their critical problems. Contributions to the United Nations
Special Fund should be expedited and augpmented. In addition, the IMF Trust
Fund should be put into operation without delay.











77/M( IT1)/4'
page 2;,


IV. Review -.f rcquircment. f',r -vulvin6 ;in intcrnatinel mnoi.ctary systCemn
that would fostLr dtvclopmcnt and world trade, having particular rear'
for thc intcrecsts of thc ievcloping countries
16. The interna-innal mnnetiry systemm in its present stat. is not
sufficiently conducive to world trade and development, and requires
fundamental chane.c- to me,'t thc intcrc'ts of tht- international community
and in particular those of the developing countries These changes must
explicitly take into account the int4-rdcpcndcnct of the proHlms of the
international monetary, finpracial and trade systems, and must he based on
universal membership and a )ust deci.inTia-making process. One of the central
objectives of the new monetary system should be the promotion of the trade
and development of developing countries. The system must provide for a
proccsE of balance-of-payments adjustment and financing that will remove
the inequiticv involved in the system as presently constituted; for the
creation and distribution of international liquidity in ways ihich will
mobilize resources for 'Icvclopmcnt; and for stability in exchange rates.
A. Universality of thr monetary system
17. The international monetary system would function more effectively with
complete universality. It should therefore embrace all interested countries
without exception, anl should in particular reflect the rights an! interests
of the dcvclopinp, countries, an'.' ensure them equitable treatment that takes
into amount their development needs.
J. Dc Lsion-makin&
IF.. Decisions on International monetary Issues, which affect the international
community at large, should be taken with the full and more effective
participation of dcvL.lopinr, countries at all stages of discussion and
ncpotiation. To thnt cn(I, the authority of the IMF in international
monetary nc,.ottiatons and decisions should be increased and the role of
restricted and unrepresentative r.roups reduced. The system of voting in
the- IMF and world d Bank should be reformed so as to accord developing
countries 7rcater representation and weight in decision-making in these
institutions.







37



77/,f 111)/49
page 2q


C. The interdependence of problems of international financial, monetary
and trade systemss
19. Problems of the international monet.'ry system are to a large degree
generated by inadequacies in the international trade and financial systems,
including insufficient access of developing countries to markets for capital
and goods. A co-ordinated approachli towards problems in these thrLc areas
should guide deliberations and negotiations in each of them so that the
overall evolution of the international economic system serves to foster
development and world traec, having particular regard to the interests of
the developing countries. UJNCTAD has an especially Important role to play
in this connexion.
D. The balance-of-paymcnts adjustment process
20. In the present monetary system, serious asymmetries exist in the ways
in which different groups of countries arc dealt with as regards the
avoidance, correction and financing of payments imbalances. Developing
countries bear al Inequitable burden of adjustment, which should be
lightened, inter alia, in the following ways:
(a) The International Monetary Fund should be equipped with a full
array of facilities to provide payments support to developing countries.
The terms and conditions, including policy conditions, carried by JIF credit
should take due account of the cause and hence the likely duration of the
deficits they are designed to cover. Greater automaticity of credit, and
reduced policy conditionality, arc required. Existing mechanisms must be
strengthened to protect the developing countries from being adversely
affected by internal maladjustments in developedd countries, such as recession
and inflation, and by other exogenous factors. The overall access of
developing countries to Fund resources must be considerably enlarged and
liberalized.
(b) Developing countries should be free to choose the policy
instruments that they consider best suited to their specific situation
and structural characteristics, without prejudice to the'r access to IMF
':rawings.







38



17A(rTI)/A9
page 30


(t) Inr.r"v,,vrnnr In tih h~li 'mc *1-0l-p'ny1nlrnt. ntdiii.tme'nL plrcc.'-:; "f
delvvloii' i i) .loUiti ; r-1t11116. Iil|+pa vciltvimll t I thh w)rld ITr:t1hii l n'1"%
inter alia, to stabilize commodity earnings and to remove trade r.Lrictions
in developed countries on products of export interest to developing countries.
(d) A properly working adjustmecnt process also requires that the
transfer of real resources to developing countries should be enlarged, to
allow them to adjust imbalances at higher levels of imports and rates of
growth, thereby rcducin8. the cost'r of such adjustment.
r. Creation nn,! distributi-,' .,f international liquidity
21. The creation and distribution of international liquidity should be
brought under more cfrective international c'n.nrol so as best to meet thc
additional liqtiiity needs 'f the world economy as a whole, and of developing
countries in particular. To that end, the rnlc of the SDR as a reserve
nsset should he strengthcncd, so that the '-Di'. may progressively replace
gold and national currencies as reserve assets. Decisions on SDI allocation
should take due account of the distribution ot international liquidity.
The Articles of agreementt of the IMF should provide for a link between SDR
allocations and additional development finance. Recent decisions regarding
gold, which have the effect of rcdistributing world reserves away from
developing countries and in favour of developed countries, should be offset.
P. Exchange rtc '
22. The exchange rate system should evol-e in the direction of increased
consistency in xchangc, ritv policies and greater stability in the exchange
rates of the major currencies. The T4F should take ,uc account of the
interests of developing countries in its decisions on exchange rate system.
In interpreting the obli;atlons and applying the principles under the
amended articles dealing, with 'xr.hincc arrangements, the It" should pay
duc regard to thc special circumstances of the developing countries.







39


77 AN(III)/49
page 31


Section Five

TRANSFER OF T NE1OLOGY

1. Action to strengthen the technological capacity of developing countries
1. Decisions should be reached at UNCTAD IV for strengthening the
technological capacity of developing countries and thereby reducing their
technological dependence. Developing countries should consider measures for
formulating national policies, regulations and laws and establishing
appropriate institutional structures at the country level, and explore the
main lines of co-operation among themselves. These measures should be
complemented by a full range of technical assistance activities necessary
for interlinking the measures at the national, sub-regional, regional and
international levels through the formulation of appropriate international
policies. Such assistance requires effective co-operation from the
developed countries, as well as co-ordinated action by international
organizations. In considering these measures, account should be taken
inter alia, of resolution 2 (I) of the Committee on Transfer of Technology
and General Assembly resolution 3507 (XXX).
A. Action by the developing countries
2. The developing countries should give consideration, at the national
level, to:
(a) Formulation of a technology plan, as an integral part of their
national development plans, as well as the co-ordination of
policies in a number of interrelated areas, including licensing
arrangements, transfer, development anO adaptation of technology,
industrial property laws and practices, foreign investments,
research and development;
(b) Establishment of appropriate institutional machinery, including
national centres for the development and transfer of technology
with urgent attention being paid to defining the role and functions
of such centres, including the principal linkages which need to
be established with other national bodies or institutions;
(c) Elaboration of all necessary measures to ensure optimum
utilization of their qualified-'iappower resources.




40



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B. Co-operation among developing countries
3. To supplement the national effort, the developing countries should give
consideration at the sub-regional,.regional and inter-regional levels to:
(a) Elaboration of preferential arrangements for the development and
transfer of technology among themselves; these preferential
J
arrangements for co-operation should, inter alia, be consistent
with arrangements involving sub-regional and regional co-operation
and integration;
(b) Establishment of sub-regional and regional centres for the
development and transfer of technology which could ser'e as
essential links with national centres in developing countries,
and also to implement initiatives such as:
(i) Exchange of information on technological alternatives
available to developing countries as a means of improving
their negotiating power;
(ii) Institutional arrangements in respect of common technological
research and training progranmmnes;
(iii) Assisting national centres effectively to fulfil their role,
inter elia, in implementing a code of conduct for the
transfer of technology and preparing model contracts for
licensing agreements on patents;
(c) Establishment of sub-regional, regional and inter-regional
centres by the developing countries in specific and critical
sectors of particular interest to these countries.
C. Co-operation from the icveloped countries
4. Developed countries should implement, as e matter of urgency, the
programme of action spelled out in paragraphs 13, 16, 17 and 18 of
Conference resolution 39 (III), ;s supplemented and reinforced by the
decisions of the sixth and seventh special sessions of the General Assembly,
culminating in General Assembly resolution 3517 (XXX).
5. The developed countries should grant the developing countries
unrestricted access to existing technology irrespective of the ownership
of such technology.







41



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6. The developed countries should co-operate actively and positively in
the implementation of General Assembly resolution 3507 (XXX) on the
establishment of industrial technological information banks, centres for
the development and transfer of technology and/or other viable information
systems.
7. Developed countries should refrain from pursuing policies which might
encourage the exodus of trained personnel from developing countries,
since this is seriously jeopardizing their progress.
D. Action by international organizations
8. The fourth session of the Conference should take decision to establish
the necessary institutional basis to enable UNCTAD to meet the responsibilities
assigned to it in the area of technical and operational assistance, in
co-operation with the international organizations concerned, particularly
UNIDO, as outlined in Conference resolution 39 (III), resolution 2 (I)
of the Committee on Transfer of Technology and General Assembly
resolution 3507 (XXX).
9. In this context, a Technical Advisory Service should be immediately
established within UNCTAD to render assistance at the request of
developing countries, and UNCTAD's capacity in this field should be
strengthened.
II. Decisions on a code of conduct for the transfer of technology and,
in the light of these decisions, a decision on the modalities for its
establishment
10. In order to facilitate and increase the international flow of all forms
of technology under favourable terms and conditions, eliminate restrictive
and unfnir practices affecting technology transactions, and strengthen the
national technological capabilities of all countries, a multilateral legally
binding instrument is the only way of efficiently regulating transfers of
technology, taking into consideration the particular needs of the developing
countries.
11. In this connexion, it is proposed that, in pursuance of paragraph III (3)
of General Assembly resolution 3362 (S-VII), the Conference should request
the General Assembly at its thirty-first session to call a plenipotentiary
conference under the auspices of UNCTAD during 1977 to establish a multilateral


74-033 0 76 4







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legally binding code of conduct nn transfer of tcchnolooy. At Lie some timc
the Ceneral Assembly should establish a preparatory committee to make the
necessary prepare& inns for the conference. of plenipotentiaries; the
preparatory comm ittee, which should bc open to the participation of all
members of UNCTAD, should hold its first session as early as possible.
12. The proposal submitted by the Group ,f 77 (annex II to t'L report of the
Intergovernmental Group of Experts on a Code of Conduct on Transfer of
Technology TD//C.6A/14) should form the basis of subsequent negotiations.
III. Actions to be undertaken by UNCTAD with rcspoct .to the economic,
commercial and development aspects of the international patent system
in the context of the ongoing revision of that system
13. (a) For patent legislation to be an important instrument for the economic
development of the developing countries, it should be designed to serve their
public interest, i.e. their developmental needs as defined in the national,
regional or sub-regional plans, policies and priorities, and should basically
be geared to creating conditions for optimal use as well as for the creation
of knowledge and technology to further the social objective of industrialization.
(b) National legislation of developing countries on inventions, where
it exists, should ensure thnt the granting of property rights by the State
is accompanied by corresponding obligations on the part of th. patentee.
(c) Adequ.ite exploitation of the agentss granted would contribute
towards fulfilling the developmental needs stated above.
14. In view of the importance attached ,- the developing c-untries to the
economic, social and devLlopment implications which the international
system of industrial property has for their economies, UWCTAD should play
a prominent role in the revision of the system, in particular in the ongoing
process of revision of the Paris Convention for the Protection 'f Industrial
Property. That role should include the participation of UNCTAD in all phases
of the revision process.
15. The conclusions reached by the experts from developing countries who
participated in the meeting of the Group of Governmental Experts on the
Role of the Patent System in the Transfer of Technology to Developing
Countries (TDB/'i93, annex III) should bc one of the bases for subsequent
negotiations.







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16. The Secretary-General of UNCTAD should continue to examine the impact
of the whole industrial property system on the development process of the
developing countries.
17. Resolution 3 (I) of the Committee on Transfer of Technology should form
a basis for further co-operation between UNCTAD and the international agencies
concerned, particularly,11IPO and UNIDO, in the preparation of the necessary
background studies for the revision of the international system of
industrial property.
18. The economic, trade and development interests of the developing
countries should be fully reflected in the revision of the international
system of industrial property and, in particular, in the revised Paris
Convention. The Declaration on the Objectives of the Revision of the
Paris Convention (IIPO document PR/GE/II/14) is, in this connexion, noted
with interest.
19. The invitation sent by the Director-General of the World Intellectual
Property Organization to all States Members of the United Nations and the
specialized agencies to participate in the third session of UTIPO's Ad Hoc
Group of Governmental Experts' Committee on the Revision of the Paris
Convention is to be welcomed as a step which can contribute significantly
to the full reflection of the interests of the developing countries in the
revision of the international system of industrial property, and all
developing countries are urged to prepe-e themselves for activee
participation in that session.
IV. Other issues
20. As regards the United Nations Conference on Science and Technology and
reverse transfer of technology (the "brain drain"), the decisions taken by
the Commnittee on Transfer of Technology in its resolution 2 (I), should be
fully implemented.
21. In order to compensate for the reverse transfer of technology
resulting from the exodus of trained personnel from the developing
countries, now amounting to several billion dollars, arrangements should be
made to provide, on a cost-free basis, the necessary financial means to
create the infrastructure to retain qualified personnel in the developing
countries.







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Section Six
LEAS'"r DEVELOPED AMONG THE DEVELOPING COUNTRIES, DEVELOPING
ISLAND COUNTRIES, AND DEVELOPING LAND-LOCKED COUNTRIES
I. Introduction
1. The Ministerial iaeeting reaffirms its conviction concerning the need to
agree upon effective international action to contribute to the solution of
the specific and permanent problems of the least developed ameng the
developing countries, developing island countries and developing laud-locked
countries.
2. The Ministerial Meeting stresses the urgency for the developed
countries and the competent international agencies to adopt and execute
without delay the measures identified within the framework of UNCTAD in the
fields of trade and financial policies, technical assistance, shipping and
transfer of technology in favour of this group of developing countries.
3. These measures shall be in addition to the measures that shall be
adopted in general for all developing countries in the spirit of the
United Nations resolution concerning the establishment of the new
international economic order and while putting these measures into practice
attention shall be given in order to safeguard interest of other developing
countries.
4. The special measures to be taken by developing countries in a position
to do so in fwvour of the least developed, the land-locked developing
countries and island developing countries should be implemented through the
machinery which thcse countries deemed appropriate.
II. Action on special measures in favour of the least developed amon, the
developing countries
A. Financial and technical assistance
Expanding the flow of assistance
5. The developed countries should:
(a) Expand the flow of official development assistance in keeping
with their commitments in the International Development Strategy,
and in so doing should ensure that the least developed countries
receive a proportionately higher share of this flow as well as
that of the total flow to meet their urgent needs;

-r S







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(b) Provide the least developed countries by the end of 1976 with an
ount at least equivalent to their share in the international
development assistance target of 0.7 per cent of the gross national
product of developed countries at market prices.
6. Bilateral and multilateral don.,r agencies should agree on effective
arrangements to ensure that each of the least developed countries receives
a proportionately higher flow of assistance taking into consideration its
special need for economic and social development.
7. Developed market economy countries, the socialist countries of Eastern
Europe, developing countries who are in a position to do so, multilateral
2/
donors- and other sources such as private grant programMes and voluntary
agencies should give high priority to increasing their assistance to the
least developed countries.
8. Developed countries and others in a position to do so should provide
strong financial support for a special fund for the least developed countries
without delay.
Terms and-conditions for financial and technical assistance
9. The terms and conditions of all future assistance to the least
developed countries should, inter alia, be as follows:
(a) Such bilateral official development assistance of developed
countries to the least developed countries should essentially be
provided ir the form of grants;
(b) Developed countries should compensate for the erosion of the
purchasing power of past aid commitments to the least developed
countries which have not yet been disbursed;
(c) Multilateral financial agencies should provide assistance to the
least developed countries in the form of grants. Where this is not
possible such assistance should be given in the form of loans on
terms as concessional as those provided by IDA;





2/ The World Bank Group, particularly the International Development
Association, the United Nations Development Programme, the regional
development banks and other multilateral institutions.







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S


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(d) Developed countries should cancel the official debts of wh least
developed, the developing island and the developing 1- .d-locked
countries;
(e) The developed market economy countries should give immediate and
favourable consideration tu providing highly concessional terms of
relief for the other outstanding debt burdens of the least developed,
the developing island and the developing land-locked countries;
(f) Multilateral financial institutions should convert leans to the
least developed countries into highly concessional forms;
(g) Bilateral donors and multilateral assistance agencies should
provide greater assurance of the long-term continuity of their
assistance to the least developed countries;
(h) Developed countries should provide programme aid to the least
developed countries and allow them to select projects in consultation
with the donor countries,
Criteria and procedures Lor financial and technical assistance
10. All bilateral and multilateral aid agencies should adopt more flexible
criteria and procedures in granting assistance to the least developed,
island developing and land-locked developing countries. They should, in
particular:
(a) Modify traditional financial criteria concerning the minimum rate
of return .1...-':t3 to take full into account the longer term
social rate of retui, including related secondary effects in these
countries;
(b) Providc financial and technical assistance in order to guarantee
minimum standards of development, contribute to the necessary
structural changes and ensure that critical needs are satisfied in
these countries;
(c) Increase budgetary and financial support for the development of
public services including projects in these countries;
(d) Finance local costs of capital projects to a substantial extent
wherever the lack of adequate local financial resources imposes limits
on the development efforts of these countries;
(e) Arrange explicitly in these countries, where necessary, for the
financing of recurring costs Pssociat.d with ongoing projects and
projects after their completiont'inclyding maintenance costs, during
an appropriate phasing out period;







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(f) Finance local costs in connexion with technical assistance projects;
(a) Providn increased help in identifying, planning end preparing.
technical and tmnancial assistance projects with a view tn expediting
the approval and implementation of projects;
(h) Assist thse.S countries in carrying out feasibility and
pre.-investment surveys and post implementation reviews;
(i) Endeavour to attract the highest quality technical assistance
personupr, speed up recruitment and project implementation
procedures and ensure the most urgent response to the technical
assistance needs of thope countries;
(j) Arrange for rapid training of local replacement personnel.
11. It i& recommended that the coveringng Council of ITNDP should undertake
immediately revision of the criteria so as to allocate additional IPF to
meet the Fdditional needs of the least developed countries.
B. Corjaerclal trade policy
1U. Special consideration should be given, within the contractual
metchaniom of commodity agreements, to the least developed countries in a
flexible and favourable manner designed to ensure the optimum marketing of
their production of such conmmodities in order to increase their foreign
exchange earnings, bearing in mind the characteristics peculiar to each
:,rc...c1+ taking into consideration the need to protect the interests of
other developing countries .
13. The generalized system of preferences should be extended to cover
agricultural products, in both primary and processed forms and handicrafts
of export interest. to the least developed countries.
14. Pending the complete removal of tariff and non-tariff barriers for all
developing countries, such barriers, including ceilings, quotas, safeguard
clauses and all other restrictive measures, particularly with regard to
products of.piesant or potential export interest to the least developed
countries, should be irmnediately and completely removed.
15. TLPe rules of origin in respect of the products of least developed
countries shoulci be further liberalized.
16. Multilateral arrangements, such as the IMF compensatory financing
facility, should include provisions to enable the least developed countries
to claitor:fpLns.tio" without ?rior conditions, in the event of increases
in inmort prices 'nd of export shortfalls.







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17. Dcv-loped countric-, should assist the lea-c developed counr es in a
co-ordinated man -er, from the planning, reduction i-nd try- sporration stag,
to the stage of ensurlni sales of their products at remunertive prices.
18. Developed countries and international organizations should adopt
measures to foster the creation of industries for on-the-spot processing
of raw materials and food products.
19. The preference-giving countries should formulate such modalities within
the framework of the generalized system of preferences as to favour, in
particular, the least developed countries.
20. The least developed countries should be granted special treatment in
the multilateral trade negotiations, priority being given to tropical
products of particular interest to the least developed countries.
21. Special measures, including exemption from financial contributions
should be taken to accommodate the needs of the least developed countries in
the integrated programme for commodities.
22. The developed market economy countries and the socialist countries of
Eastern Europe should:
(a) Provide long-term guarantees of a reasonable level of sales of the
products of tho least developed countries;
(b) Give favourable treatment, in the case of government procurement,
to imports from the least developed countries;
(c) Assist zhe lepst deve'Ipcd countries to develop the production
potentialities of food, energy and other resources including
manufactures.
23. in the development of arrangements in the context of the integrated
procramme for cornnmodities, and in other multilateral agreements affecting
the imports of the least developed countries, every effort should be made
to reduce the burden of import costs on these countries by means of
appropriate differential and remedial measures within these arrangements.
C. F.crjnonic co-operr.ttion among developing countries
24. The developing countries in a position to do so should:
(a) Provlde preferential treatment, as far es possible, to imports of
R.oods produced by the least developed countries;
(b) Assist the least developed countries to develop the production
potentialities of food, energy and other resources, including
mnanufactures; % '







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(c) Provide under preferential terms and conditions and at a minimum
c'nt tiO. re:.uOI f r ;icitific nd technological development ndaptcd to
the development needs of the least developed countries;
(d) Provide increased flows of financial and technical assistance and
goods for the benefit of the least developed countries through special
preferential z.rrangemcnts;
(e) Promote and expand joint ventures with the least developed
countries involving the transfer of equipment and technology in the
context of long-turmn bilateral agreements or special arrangements;
(f) Explore the possibilities of undertaking long-term arrangements
to assist least developed countries to achieve a reasonable level of
sales of their products.
D. Shipping and promotional freight rates
25. The governments of developed and developing countries should invite
shipowners and liner conferences to establish freight tariffs for the
least developed countries which will encourage and assist the expansion of
the export trade of these countries, and to develop promotional rates for
the non-traditional exports of the least developed countries which will
facilitate the opening. of new markets and the development of new trade flows.
26. The developed countries and the international financial institutions
should give high priority to providing financial and technical assistance to
the least developed countries to help" them in acquiring and expanding their
national merchant fleets and in improving their port facilities.
E. Transfer of technology
27. The developed countries and competent international institutions should:
(a) Assist the institutions of least developed countries to obtain,
under preferential terms and conditions and at a minimum cost, the
results of scientific and technological developments appropriate to
their requirements;
(b) In order to overcome the technological and negotiating weaknesses
of the countries, assist in the establishment of transfer of technology
centres designed to obtain necessary technological information, to
select from available alternatives and to negotiate proper terms and
conditions for external collaboration;






50


77/M (MI)/4',
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(c) Ma'rje arrangements fot the grant of patented, patent--. elated and
non-patented Lechnologies, including .mow-how, suited tc the economic
conditions of the least developed countries;
(d) Provide the necessary assistance for establishing institutions of
applied technology, with the aim of developing indigenous technologies
and promoting the adaptation of imported technologies to national
requirements;
F. Other action by UNCTAD
28. The Secretary-General of UNCTAD should convene as soon as possible a
special meeting st which multilateral and bilateral financial and technical
assistance institutions can carry out, together with representatives of the
least developed countries themselves, a general review and assessment of
their requirements and progress and of the problems arising in the
co-ordination and implementation of assistance programmes on both the donor
and the recipient sides, with the aim of agreeing on a global plan for a
much more rapid increase in growth and welfare in the least developed
countries.
29. The Secretary-General of UNCTAD should convene an expert group to study:
(a) The implications of an integrated vertical approach for expanding
the exports of the least developed countries, and involving co-ordinated
efforts ranging from the planning and production stage in the least
developed countries to the stage of ensuring sales of their products in
the developed countries;
(b) The possibilities of providing long-term guarantees to the least
developed countries of a reasonable level of sales of their products
in the developed countries;
(c) The possibility of creating and developing institutions and
financing corporations in the developed countries as well as in the
least developed countries, specifically designed to promote the sale
of products of the least developed countries, including the development
of suitable guaranteec arrangements by the developed countries concerned
to offset the risks of such trade.











77/1H(1I)/49
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30. The Secretary-General of UNCTAD should:
(a) Strer-then the technical assistance activities of UNCTAD in
collaboration with UNDI' in the planning and policies of the foreign
trade sector of the least developed countries and in other specific
areas within the competence of UNCTAD;
(b) Implement the work programme contained in "Issues for Consideration
by the Intergovernmental Group" (TD/B/AC.17/2) Part IV stressing also
the need of in-depth study of the circumstances of the individual least
developed countries;
III. Action on special measures in favour of developing island countries
A. Shipping
Trans-shipment problems
31. Several island countries need to trans-ship goods through other countries
which are on world traffic routes. Thts involves extra cost and delay for
both imports and exports; it can further cause difficulty in meeting export
commitments, and is inhibiting the development of exports from affected
island countries. Measures to facilitate trans-shipment, including,
inter alia, appropriate storage and port facilities, are needed.
Prevention of discrimination against island ships
32. There are cases of island ships being discriminated against in transit
ports or in the ports of trading partners. The governments concerned should
take steps to preventt such discriminat'j>n.
Insurance of inter-island ships
33. Measures necessary to ensure that break-bulk carriers plying between
islands in a region are not discriminated against in obtaining insurance.
Promotion' freight rates
34. The governments of developed and developing countries should invite
shipowners and liner conferences to establish freight rates for developing
island countries which will encourngc and assist in expanding the export
and import trade of these countries, and to develop promotional rates for
non-traditional exports and imports of developing island countries which
will facilitate the opening of new markets and the development of new
trade flows.







52



77/41 page G4



Research on appropriate _hipjand shore facilities for archipe''aic States
35. Archipelagic States often face the problem that their own outlying
islands can be hindered by poor services from full participation in foreign
trade. Special research and development efforts should be undertaken to
evolve appropriate t/p. r of ship znd shore facilities.
Co-operation with shipping conferences
36. It would be desirable to achieve better co-operation between the
governments of island developing countries and shipping conferences in order
at least to maintain a fair relationship between the pace of increase in
freight rates and port congestion surcharges on the one hand and the level of
economic development of the island countries concerned on the other.
Trainin& for ship repair and maintenance
37. Assistance from UNCTAD, the regional commissions and other bilateral
and multilateral organizations would be desirable in training the technical
manpower needed for ship repair and maintenance and for marine insurance.
Assistance in establishment of shipping services to promote regional
co-operation
38. Assistance from UNCTAD and the regional commissions would be desirable
in promoting sub-regional co-operation among developing countries and in
particular island developing countries towards the establishment of
consortia or international shipping companies to develop trade between these
countries.
B. Air services
39. Measures are desirz.ble to improve the quality and cost of air services,
including appropriate airport facilities, Archipelagic States often face
the further problem that their own outlying islands can be hindered by poor
services from full participation in foreign trade. This calls for advice
on appropriate types of aircraft and ground facilities.
40. It would be desirable! to achieve better co-operation between the
governments of island developing countries and airlines in order at least
to maintain a fair relationship between the pace of increase in freight
rates and fares on the one hand and the level of economic development of
the island countries on the ouher. V -







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77/Iw(H1)/49
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41. Likewise, special research and development of efforts are needed for air
services, with pnrtlcular attention to the scope for air transport of
imports and exports. As an immediate measure promotional rates should be
applied to the non-traditional imports and exports of developing Island
countries.
42. Assistance from the regional commissions and other bilateral and
multilateral organizations would be desirable in training the technical
manpower needed for the repair and maintenance of aircraft and other
equipment related to air transport.
43. Assistance from UCTAD and the regional commissions in promoting
sub-regional co-operation among the developing countries, and in particular
island developing countries, towards the establishment of consortia or
international air transport companies to develop trade and travel between
those countries.
C. Group of experts on feeder and inter-island services .
44. The Secretary-General of UNCTAD should be invited to convene a meeting
of experts on feeder and inter-island services by air or sea, and provision
should be made for IINCTAD to undertake studies and technical assistance
within its competence, the need for which the group might identify.
D. Telecommunications
45. Technical and financial support should be provided to island developing
countries for the creation and improvemeri. of Inter-island .elecommunication
links as well as telecommunication links with the rest of the world.
E. Marine and undersea resources
46. The sovereignty of developing island countries and particularly the
archlpelagic States, over their marine and sub-marine resources should be
recognized ind affirmed. The multilateral financial institutions and
technical assistance agencies should provide effective assistance to these
countries to enable them to exploit fully those resources. In this
connexion technical and financial assistance should be provided to
developing island economies in the development of their fishing industry.






54


7 7/4M) n 111 '/
poae 46


F. ComuiLP.' Xt L xpur f.^j i n 1a\J
47. Often having small ..'r precarious economies, the develL ping; island
countries have a particular interest in measures to increase and stabilize
commodity export earr.iN.s. Bilateral and multilateral aid institutions
should be invited to prrticipat.1 in special compensatory financial schemes
for island countries depending for their export revenue essentially on one
or two products. U';:TAD should be invited to assist in elaborating and
implementing. appropriate schemes.
G. Import co-operation
48. Priority should be given in extending technical assistance and financial
aid to groups of developing, island countries to facilitate the establishment
of schemes for collective import operations, which could represent
Substantial savings in terms of costs, insurance, freight and handling and
storage charges.
H. Human geography of small islands
49. .id donors, and in particularr international organizations, should be
urged to pursue and intensify studies and technical assistance efforts to
assist small islands to plan rationally in order to deal with the peculiar
problems which their precarious environment and rugged topography impose
upon human settlement, including the provision of public services and the
problem of harmful aspects oi urbanization. In advising governments of
island countries, UNC7.au should bear particularly in mind &he consequences
of different kines of foreign trade development on the human geography and
ecology of the islands.
I. Tourism
50. In the case of developing island economics tourism is an important
sector of their economic development, and financial and technical assistance
should be given to these countries to develop their tourism potential.
J. Financial aid
51. Particularly favourable conditions for the financing of the purchase of
ships should be accorded to developing island countries.











77/AH(11)/49
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52. Developing island countries should benefit from the measures elaborated
for the least developed countries concerning financial and technical
assistance; in particular, assistance in order to carry out pre-feaaibility
and pre-investmc-nt studies and to execute port infrastructure projects
concerning the repair and maintenance of ships and road infrastructure.
53. UNCTAD and the regional commissions should provide assistance in order
to promote sub-regional co-operation for the establishment of an Inter-State
shipping line for the development of trade among the countries concerned.
54. Liner conferences should co-operate with the governments of developing
island countries with a view to ensuring that freight rates and surcharges
imposed do not hinder the economic development of the developing island
countries.
IV. Action on special measures in favour .of the developing land-locked countries
A. Joint co-operation
55. UNCTAD III unanimously adopted resolution 62 (III), complemented by
resolution 63 (III) containing other special measures in respect of the
particular needs of the land-locked developing countries, thereby recognizing
that their lack of access to the sea constitutes a handicap to their economic
development.
56. A co-operative approach to each specific transit situation should be
encouraged so that all available possibilities for improving particular
route and transit facilities could be corsidered together and each of the
transit routes available to a particular land-locked country could be
evaluated in order to determine the best available options for future
progress.
B. Regional and sub-regional planning
57. The land-locked developing countries can derive substantial longer-term
benefits from the improvement of regional and sub-regional transport
infrastructure. The international organizations and financial institutions
shouLd give high priority in their assistance programmes for such projects.







56


77/ft4(I1I)/4'
pape 4S


58. Laud-locked coun*-ies would benefit from the harmcnizati. of transport
planning and the promotion of joint ventures in the field of transport at
'he sub-regional levi. "here applicable, similar actions should be
encouraged on a bilateral basis between the developing land-locked countries
and the transit countries.
59. Interested land-locked countries, in co-operation with other countries,
might consider creating a co-operative air transport development project
based upon a central organization which could undertake the necessary
planning studies with appropriate technical assistance.
C. Commercial policy
60. The generalized system of preferences should be extended to cover
agricultural products, in both primary and processed forms, of export
interest to the land-locked countries. The rules of origin in respect of
products of the land-locked countries should be liberalized. Pending the
removal of quota restrictions applicable to the generalized system of
preferences ceilings should be calculated on the basis of the cost at the
port of export of land-locked developing countries.
D. Transport
61. /.t the joint request of the land-locked developing countries and their
transit neighbours, technical and financial assistance should be provided
for studies of the feasibility of extending the railway system of transit
countries into land-locked countries.
62. Technical and financial assistance should be provided by the
international community in the form of grants or in the form of special
concessional loans for the construction and maintenance of transit roads
both in land-locked countries and transit countries and for the purchase
and maintenance of road transport vehicles.
63. All land-locked countries can use air transport for the transport of
low-bulk high-value goods. In addition they would need to develop air
transport to promote tourism for which most of them have a high potential.
Therefore it is suk,,estcd that each land-locked country should have one
fully equipped international airport anO that feasibility studies of
providing such airports should be undertaken as a matter of urgency. For
this international orlani/ations and financial institutions should provide
technical and financial assistance.







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64. The possibility of establishing alternative transport routes on a
competitive basis from land-locked countries to the sea abshould be explored
and developed. For this purpose, technical assistance is required from
the international community.
E. Communications
65. Fast and reliable communication links between the commercial centres
of the land-locked countries with the transit ports on the one hand and
with the overseas markers on the other hand should be developed.
66. Financial and technical assistance should be provided for the
improvement and creation of communications facilities in the land-locked
developing countries.
F. Restructuring of the economy
67. Land-locked developing countries require technical and financial
assistance for the restructuring of their economies. It would be
worthwhile for these countries to explore the possibility of establishing
import substitution industries which produce high-bulk low-value goods.
This would save them incurring high transport costs for their. imports from
other countries. Furthermore, the development of export industries
producing high-value low-bulk goods should receive high priority.
International organizations and financial institutions should provide
technical and financial assistance for this purpose and accord high
priority for thi establishment of pilot projects to achieve the aforesaid
objective.
68. In order to enable land-locked countries to derive substantial gains
from regional economic co-operation, UNCTAD should, on request, provide
technical assistance to t-.-:e countries in formulating suitable regional
economic co-operation agreements with their neighboring countries.
69. Land-locked countries require financial and technical assistance in
order to carry out a detailed survey and development of their mineral and
energy resources and to study new forms of transport which will enable them
to exploit such resources.
C. Port facilities and development
70..Ways and means to develop and improve the transit and port facilities
should be explored and .ndertaken.


74-033 0 76 5







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71. On request from the countries concerned, the international or-anizations
such as UINCTAD and IDA should provide technical and financial assistance
with a view to improving and facilitating the use of the transit port or
transit areas therein specifically for the land-locked developing countries.
H. Flow of external resources
72. The criteria, terms and conditions governing the flow of bilateral and
multilateral financial and technical assistance to the land-locked
developing countries should be not less favourable than those accorded to
the least developed among the developing countries. In particular, it is
important to adopt, inter alia, the following measures:
(a) financial assistance to these countries on the most highly
concessional terms possible;
(b) a substantially increased flow of financial and technical
assistance;
(c) more flexible criteria for the evaluation of financial and
technical assistance projects to correspond to the particularly
difficult circumstances of these countries;
(d) criteria for the approval of such projects which would take full
account of long-term social benefits including secondary effects;
(e) substantial provision for financing the local and foreign exchange
costs of the projects;
(f) minimization and, wherever pos.ble, waiving of counterpart
requirements for technical assistance;
(g) particular efforts to help these countries in the formulation and
preparation of projects and in speeding up their implementation.
73. The multilateral and bilateral financial institutions including the
international organization should intensify their efforts in raising the
flow of resources to develop and maintain the economic and transport
infrastructures necessary for the land-locked developing countries.







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1. Shipping freiRht and transit coat
74. Liner conferences should provide preferential and promotional freight
rates to the products exported by or imported into the land-locked
developing countries.
75. Ways and means have to be explored to further reduce the transit costs,
wherever possible.
76. The developed countries and international financial institutions should
provide financial and technical assistance to explore and develop
alternative transport routes on a competitive basis to the sea.
77. TIR warehouses should be established in the land-locked countries on a
preferential basis.
J. Air transport and tourism
78. The regional economic commissions and other bilateral and multilateral
organizations should assist the land-locked developing countries in the
development of air transport and tourism with a view to maximizing their
foreign exchange earning capacity through merchandise exports or invisibles.
79. Financial and technical assistance should be provided to the land-locked
i
developing countries on exceptionally favourable terms for the purchase of
aircraft and other equipment related to air transport.
K. Special fund
80. The Secretary-General of UNCTAD should prepare the modalities for
immediate opera-ion of the newly created United Nations special fund for
land-locked developing countries in order to compensate them for their
additional transport costs.
81. The developed countries and others who are in a position to do so should
undertake immediate action to contribute to this special fund in order to
make it operational.
L. Review of progress
82. The countries members of UNCTAD especially the developing countries,
should review measures which they have taken in favour of the land-locked
developing countries, including the means by which such measures are
undertaken.




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83. The Secretary-Getra I of UNiADl), in consultation with ot. r international
organi.atioops, should formulate and submit to the Nairobi Conference a
progranmme of action, in favour of the Land-locked developing countries with
a view to developing tLheir:
(a) transport infrastructure, and
(b) foreign trade sector.
M. Free access to and from the sea
84. The developing land-locked countries reaffirmed their right of free
access to and from the sea, a right affirmed by the Fourth Conference of
Heads of State or Government of Non-/.ligned Countries and by the
Dakar Conference on Raw materials. Some developing transit countries
reserved their position on the matter.
V. Action on special measures applicable to the least developed, developing
island and developing land-locked countries
A. Natural disasters
85. Assistance should be extended to the least developed, developing island
and developing land-locked countries to provide for the likelihood of natural
disasters in elaborating their economic development programmes.
86. Technical and financial assistance in'establishing national and regional
schemes for disaster preparedness, insurance or relief should be provided.
87. The Secretary-General of TNCTAD is invited to communicate to the
competent organizations within the United Nations family the earnest desire
of the Croup of 77 that these organizations should intensify their research
and projects under way concerning the forecasting'of natural disasters and
that they should make the results readily available to the countries
concerned.
B. Industrialization
88. Least developed, developing island, and developing land-locked countries,
especially those lacking natural resources, are dependent on industrialization
for their export earnings. Special assistance is necessary in their
efforts towards industrialization in order to help them overcome those
problems created by the limited size of their internal markets.







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C. Transfer of technology
89. Least developed,, developing island, and developing land-lockod
countries face particular problems in .boveloping and supporting tbeir mn
technological capacity. These problems should be acknowledged in the
elaboration of a code of conduct on the transfer of technology, and
appropriate remedies should be included.
D. Review of progress
90. The Secretary-General of UNCTAD, in consultation with the international
organizations and the regional economic comniasions, should keep under
constant review the progress in the implementation of the special measures
in favour of least developed countries, land-locked developing countries
and island developing countries called for in the relevant UNCTAD
recommendations and resolutions as well as in the Programme of Action on
the Establishment of a New International Economic Order, and report to the
Trade and Development Board.
Section Seven
ECONOMIC CO-OPERATION ANONG DEVELOPING COUNTRIES
Measures of support by developed countries and international organizations
to the programme of economic cooperation _aong developing countries
1. The Third Ministerial Meeting of the Group of 77 has adopted a programme
of economic co-operation among developing countries- and has considered the
concrete measures through which effective and substantial support to this
programme should be forthcoming from t e developed counties and international
organizations.
2. It recognizes that, however much the developing countries mobilize their
own resources, it would not be possible for them to achieve their own
objectives of development without concomitant action on the part of developed
countries and the institutions in the international community. It likewise
affirms the principle of interdependence and that the growth and development
of the developing countries and the prosperity of the international
community as a whole depend upon the prosperity of its constituent parts.


3/ See annex I below, resolution 1.







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3. In conformity with resolution 3362 (S-VII) adopted by the generall Assembly
at its seventh special session urging the developed countries and the
United Nations system to provide, as and when requested, support and assistance
to developing countries in strengthening and enlarging their mutual
co-operation, they consider that:
(a) The developed countries, both the developed market-economy
countries and the socialist countries of Eastern Europe, should
com-it themselves to abstain from adopting any kind of measures or
action which might undermine the decisions of developing countries
in favour of the strengthening of their economic co-operation and
the diversification of their production structures.
(b) The developed countries, both the developed market-economy countries
and the socialist countries of Eastern Europe should agree to
support decisions taken by the developing countries in pursuance
of the adoption and implementation of a programme of economic
co-operation among themselves, including the following measures:
(1) Support of existing and new programmes of interregional,
regional and sub-regional economic co-operation, and
integration among developing countries, including-those aimed
at full economic integration as well as those with more
limited trade, monetary and sectoral objectives;
(ii) Sipport of developing countries in the setting up and
functioning of multinational marketing enterprises. This
support should include the removal of obstacles to their
operation;
(ill) Allocation of funds within their development assistance
programmes for the promotion of multinational ventures of
developing countries, such funds to be applied to the
financing of feasibility studies, project inventories and the
building up and assessment of available technologies and
technological research;
(iv) Promotion and financing of multilateral interest subsidization
schemes by developed countries to reduce the cost of loans by
surplus developing countries to other developing countries;
(v) Support, including financial support, to programmes of
economic and technical co-operation of developing countries;







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(vl) Facilitating the participation of developing countries, on a
sub-contractual basis, in projects undertaken by the developed
countries.
(c) The developed market-economy countries should: in particular:
.(i) Support preferential trade arrangements among developing
countries including those of limited scupc, through technical
assistance and through appropriate policy measures in
international tradc organizations;
(11) Adopt measures to induce the "unpackaging of the equipment
and technological components in sales contracts of their
exporting firms, so as to encourage importation of technology
by developing countries from other developing countries;
(iii) Provide technical support for the establishment of financial and
capital markets in developing countries to help strengthen direct
.,: financial links between surplus and deficit developing countries;
(iv). Remove restrictions, taxes and. other obstacles that discriminate
between borrowing developing countries and domestic borrowers
seeking access to their capital markets;
(v) Support the expansion of existing and the creation of new export
credit finance and guarantee schemes by the World Bank and regional
and sub-regional development banks.
(d) The socialis' countries of Eastern E rope should lend heir support, in
particular through:
(i) The provision of technical assistance for the setting up and
operation of State import and export enterprises of the developing
countries, both at the national and multinational levels;
(ii) The promotion of links, wherever appropriate, between the
transferable double system of the International"anak for Economic
Co-operation and sub-regional and regional payments arrangements
of developing countries;
(iii) Technical assistance to developing countries engaged in the
formnulati)n of joint investment programmes in the productive
sectors, as well as technical, commercial and financial support
to those countries in. the implementation of such programmes.




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(c) International financial institutions, including regional and sub-regional
ones, should give their strone.cst support to the programme of economic
co-operation amonG; devlopin, cruntries, particularly by!
(i) Adjusting their internal operational and financial policies so as
to take specific account of the particular difficulties involved
in the promotion of multinational projects. This may be achieved by:
The creation of special promotional units within these
institutions;
The creation of pre-invcstmncnt funds for the preparation and
promotion of multinational investment projects; and
The earmarking of loan funds for that type of project;
(ii) Making use of part of their resources for equity financing of
multinational enterprises set up by developing member States.
Section Eight
TRADE RELATIONS AMONG COUNTRIES HAVING DIFFERENT
ECONOMIC AND SOCIAL SYSTEMS
Multilateral actin for expanding the trade and economic relations
between countries with liffcrent economic and social systems, in
particular action which would contribute to the development of
developing countries
1. In vlew of the expansion of East-West trade, countries participating in
this trade should take fully into account the interests of the developing
countries and ensure that it provides them with ever-increasing trade
opportunities.
2. Steps should" be taken by the dcvelupe' market economy countries and the
s-cialist countries of Eastern Europe to expand multilateral, including
tripartite, forms of economic co-operation to promote the interests of
developing, countries.
I. Expanding the trade an' economic relations between the socialist
cuntric.e of Eastern Europe and the developing countries
3. (a) ArLas of economic co-operation should be widened through the
identification in'! ad'ytion of measures to promote an increase
of exchanges with developing countries.







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(b) At the Nairobi Conference, the socialist countries of Eastern
Europe should agree to present concrete prr.poinls to the Trade and
Development Board at its sixteenth session regarding co-operation
between the socialist countries of Eastern Europe and the
developing, countries on trade and development.
4. All socialist countries of Eastern Europe should eliminate or reduce
their tariff and] non-tariff barriers on imports from developing countries
on the basis of non-reciprocity and non-discrfmination.
5. Those socialist countries o( Eastern Europe which have not already done
so should implement without delay their schemes of generalized preferences or
other aslmilnr measures. Those countries which have already implemented their
schemes should exp,'nrl and improve them with respect to the products covered
and the list of beneficiary developing, countries. The socialist countries
of Eastern nurope should not link their schemes or the application of those
schemes to hilitcral contracts or agreements with beneficiary countries.
6. The CMEA member countries should give due consideration to the trade
needs of developing countries when their economic development plans are being
formulated ind co-ordinated within the CMEA, particularly by making
Appropriate provisions in their plans for an increasing volume of imports from
the developing countries, especially in processed and semi-processed forms.
7. The socialist countries of Eastern Europe should adopt policies and
measures which m-y ensure growth of dcnmand and consequent imports from
developing countries.
8. In order to facilitate trade between the socialist countries of Eastern
Europe and developing countries;
(a) ThL socialist countries of Eastern Europe should not demand
equivalent purchases frim developing countries in order to enable
the devclopinp countries to expand their exports;
(b) Trar!c between the socialist countries of Eastern Europe and
dleveloing; countries should be covered 1y appropriate payments
arrangcre-rnts, including where required provisions for the
convertibility of the surplus balances of developing countries
inti cnvcrtible currencies;







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(c) TlJT CMElA pavnyecnts .arrangeument3 In transf'rable rou(les should
be improved tc t:ike into account the trade needs uf lvcloping
countries, particularly by making it possible for developing
countries to transfer their positive balances from one GCEA
country to another after an appropriate time lag in order to
allow for the necessary adiustments to be made within the
C4EA countries.
9. Steps should be taken by the socialist countries of Eastern Europe tot
(a) Provide adcquitc opportunity to developing countries to participate
in joint ventures in third countries-
(h) iJhtrc appr',priatL, progrcssively vacate industries in which the
comparative advantages lie with developing countries or which
involve processing of raw materials in favour of developing countries;
(c) Establish production capacities in developing countries as
appropriate.
10. The socialist countries of .astern Europe shoulO take appropriate steps
effectively to increase their financial and technical assistance t- -,eveloping
countries with a view to mectinp, without dcl-y their coummUitncnt to achieve
the targets for such assistance in the International Development Strategy
for the Second Unite,! Nations Dcvelopment Decade, in particular the target
of I per cent of their 0N". The socialist countries of Eastern Europe should
present concrete proposals in this regard within UNCTAD by the cnd of 1976
at the latest.
11. International economic crganiz.ations of the CMEA countries, as well as
their banking Institutions, such as the International Benk for Economic
Co-operation and thv Intcrnational Investment Bank, should:
(a) Expind their facilities and the size of the Special Fund for
Fin.,ncinz Prpgr.-imrnm- of Zconomic and Technical Assistance to
D1velopinb Countries for financial assistance to levcloping
countries:
(b) Activate way nld nmcans, including the dinwing up ')f programmers,
thrj.:h which that Fund could be effectively utilized by the
:,vclopin' countries;







67




):11-c 59)


(c) }Undt rt;nk, tI., pr,,nti, tlit usC Of thC Fun', ftr the dtvvc,,'pmcnl
purposes (f the level-ipinj countries through the provision of

inforniario.n r. the terms and conditions of the hun., including
its facilities.
12. The CNEI. secrvtariat should' facilitate the flow of information to
developing countries, ,Irect.y or through the UNCTAD Technical As,;istince
Unit and th. ITC, on trade opportunities in CMEA countries f>r developing
countries,
13. The Secretnry--urneral of UNCTAD should enter into appropriate
consultations with the CMEA member countries, and the CMEA secretariat, in
order to identify trade opportunities for developing countries resulting
from the implementation of various multilateral schemes by the CMEA countries,
and in the light of these consultations should consult with other interested
international organizations, particularly UTITDO and FAO to assist the
developing countries to participate effectively in such schemes.
II. Strengthening institutional1 arrangements
14. The UNCTAD consultative machinery for dealing with problems in trade
and economic relations nmong countries having different economic and social
systems should be improved,' and made more flexible in ordLr to enable the
Secretary-General uf IJNCTAD, in co-operation with the international organizations
c-ncerne:, to convene consultations at the request of interested countries to
discuss new arens of economic and industrial co-operation -which may promote
the trade inter-.ts of developing countries and the possibility of
co-ordinating the planning efforts .f interested countries.
15.- Technical assistance activities -f the UNCTAD secretariat designed to
promote trade between the socialist countries of Eastern Europe and the
developing countries should be intensified in the fields Af (a) the
dissemination of information on trade, trade policies and practices, (b) the
training of personnel, and (c) the promotion of business contracts. In order
to ensure effective implementation of these activities, UNCTAD should make
full use -f the ITC and should establish close co-operation with UNIDO,
UND -mnd the regional economic commissions. In providing technical assistance,
the UNCTAD secretariat should assist, in particular, the developing countries
which have just entered -r may wish to enter into trade and economic relations
with the socialist c,-untries of Eastern Europe.




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Section Nine
Revi-w of institutional arrangements in UNCTAD)
I. Introduction
1. General .sscmbly resolution 1995 (XIX) end Conference resolution 80 (III)
provide for a regular review of the institutional arrangements in (INCTAD.
The General Assembly, in its resolution 3362 (S-VII), decided to establish
an ad hoc Conmittec on the RestructurinR of the Economic and Social Sectors
of the United Nations System ant' recomcmended that the ad hoc Coinittee should
take into account in its work, inter alia, "the results of the forthcoming
deliberations on institutional a.rrangcmcnts of UNCT/I at its fourth session".
2. There are substantive reasons for a review of the institutional
arrangements of UNCTAD at UNCTAD IV. Among these are the major changes which
have taken place in the world economic situation, which have led to the
recognition of the development issue as a major factor in international
economic relations. Partly in response to these changes, the General Assembly,
in its resolutions 3201 (S-VI) and 3202 (S-V1), had elaborated a
Programme of Action on the Establishment of a New International Economic
Order, and, by its resolution 1281 (XXIX), had adopted the Charter of
Economic Rights and Duties of States.
3. ThL realization of the new international economic order will require
effective negotiating machinery to deal with international economic issues
and to translate road principles and gui*:elines, such as tl.asc formulated
by the CGeneral A.ssembly, into -pccific policies and concrete agreements.
The scope of these negotiations will comprise policies and measures which
have a substantial impact on the level, composition and conditions of
international flows of goods and services, technology, payments ane
financial resources. I'hile existing institutions deal with certain aspects of
this broad range of issues, there are many gaps which need to be filled,
inter alia in relation to the interrelationships between problems and
measures proposed in these different areas.
4. An'-ng the 'r6 .nizations of the Unite(! Nations system with
responsibilities for international c.,nomic issuer, UNCTAD (a subsidiary
organ of th GeCneral Assembly) has been the source and the advocate of
many of the c ,ncepts which a'ire now key elements of the policy statements







69



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of the General Assembly. It has als. been entrusted by the General Assembly
with broad negotiating functions in the fields covered by them. The
universality of its membership and the breadth of its terms of reference
qualify UNCTAD to play a decisive role in the further elaboration and
implementation of the new international economic order.
II. The future role of UNCTAD
5. The above considerations point to the need to transform UNCTAD into
an effective institution of the United Nations system for deliberation,
negotiation and review in the field of trade and international economic
co-operation, maintaining its close relationship with the General Assembly.
This would be a step towards the final objective of creating a comprehensive
world trade and development organization.
6. The vital function of UNCTAD as a generator of new ideas and new policy
approaches should be retained and strengthened in order to increase its
effectiveness as an international organ for improving the conditions of
international trade and accelerating the economic development of the
developing countries.
7. Furthermore, there is a necd to strengthen the negotiating function of
UNCTAD in order to enable INCTAD to play-its full part in translating
principles and policy guidelines, including those enunciated by the
General Assembly, into specific policies and concrete agreements, and to
make its contribution to the c3tablis- tent of the new international economic
order.
P. The competence of UNCTAD (the Conference, the Board and the secretariat)
should be strungthencil, taking into account the interests of the developing
countries and the need for it to evolve into an effective central
negotiating organ of the United Nations to deal with issues in the field of
trade and international economic co-operation and thereby directly assist
the General Assembly in its efforts to realize the now international
economic order. Thus, UNCTAD would continue to exercise an overview of
negotiations being conducted elsewhere in respect of issues concerning
trade and international economic co-operation. In consequence of its







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cross-sectoral responsibiliLies, UNCTAD would also assist the General Assembly
by keeping under rcvikw the interrelationships between the relevant problem
areas and the measures prcyscd in relation thereto, and by making
appropriate rccorinendations.
Q. On the basis of these principles, the necessary organizational changes
in respect Al. the machinery cf UNCTAD, Includin?, those set out below, should'
be made in order to strengthen ULJNCTAD's decision-making and negotiating
capacity. Moreover, the name of UNCTAD should be changed to describe more
accurately its character as th organization within the United Natins
responsible f'r the functions described above.
III. The CoiiUtcrence ..n' thLt Tra '. and Development Board
10. The membership of the Trade and Development Board should be open to all
members of UNCTAD.
11. In accordance with Board rcsoluti(,n 45 (VII), paragraph 9, and
Conference resolution ..O (111), paragraph 8, which envisages the holding of
sessions of the Board at a ministerial level, the Board should meet in
ministerial sessions once betwect the fourth and fifth sessions of the
Confcrcnce. After the fifth session of the Conference, the Board should
meet at the ministerial level every two years unless it decides otherwise.
Such a ministerial session should normally not last more than one week and
should be prcceed by a mdcting ,f senior officials to mak. the necessary
preparations.
12. The fifth session of ULNCTAD should be held not later than three years
after the fourth session (f (.NCTAD, in accordance with General Assembly
resolution I'#5 (XIX), para,raph 2, which provides that the Conference
shall normally be convened at intervals of not more than four years.












77AM( II) /49
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IV. Machinery for strcngthening cc.jn'-niic ci-operati.on am-.,n, flevcloping
countries
13. The need for appropriate institutional arran;:mc.nts shuuldc be examined
in order to provide n framework that would] impart furth,.r impetus tr. the
promotion of economic co-operation among dlevelopins: countries. Such
arrangements wuldi not only facilitate! priolic rcvlew of progress made,
but also help to evolve new anJ minutually self-supporting forms of
co-operation., fnong the possibilities that could be considered in this
regard would be a str(cngthcnin., of th': r:ol f 'JNCTtD, including the
establishment of a Committee on Ec..onomic Co-opcraticn mnong Developing
Countries, whose function would be to consider measures t( provide,
as ant when requ.stcd, support and assistance to devcl-ping countries in
strengthening and enlarging, their mutual co-operation at sub-regional,
regional, and inter-rcginal levels.







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Annex I
page 1


ANN4LX I
RESOLUTIu4S AND DECISIONS ADOPTE BYIT THE THIRD MINISTERIAL
ME-'I. OF THE GROUP OF 77
A. RESOLUTIONS
I. Economic co-operation among developing countries
The Third Ministerinl Meeting of the Group of 77,
Recalling General Assembly resolutions 3177 (XXVIII) of 17 December 1973,
3241 (XXIX) of 29 November 1974 and 3442 (XXX) of 9 December 1975 on economic
co-operation among developing countries,
Reaffirming the principles established in the Declaration and the
Program of Action on the Establishment of a New International Economic Order,
as well as in the Charter of Economic Rights and Duties of States, adopted in
General Assembly resolutions 3201 (S-VI), 3202 (S-VI) and 3281 (XXIX),
Reaffirming further the relevant provisions of General Assembly
resolution 3362 (S-VII) of 16 September 1975 on development and international
economic co-operation,
Bearing in mind the Action Programme for Economic Co-operation among
Non-Aligned and other Developing Countries adopted by the Conference of
Foreign Ministers of Non-Aligned Countries, held at Georgetown from
8 to 12 August 1972, and reaffirmed at the Fourth Conference of Heads of
State or Goverrment of Non-Aligned Countries, held at Algicrs from
5 to 9 September 1 73, as well as the Decl,'ration, the Progrrime of Action and
the economic resolutions adopted at the Conference of Developing Countries on
Raw Materials held at Dakar from 3 to 8 February 1975,
Bearing in mind also the relevant resolutions of the Conference of
Ministers for Foreign Affairs of the Non-Aligned Countries held at Lima from
25 to 30 August 1975 dealing with co-operation among developing countries,
particularly resolution X on the establishment of a Solidarity Fund for
Economic and Social DLvelopment in the Non-Aligned Countries, resolution XI on
the establishment of the Councii of Associations of Developing Countries
!trod'Lcrers-Exportrs of Raw Materials and resolution XII on the establishment
of the Special Fund for Financing of Buffer Stocks of Raw Materials and
'rlrr.ary Products,












77/MM(111 )/49
Annex I



Considering that the e/cnts of recent years have given a new importance to
thc concept of ecor. .mic co-operation among Jeveloping countries and that the
failure of the traditional economic order to solve the problems of poverty and
economic uriderdevt-l.topment haz .mparted a sense of urgency to the need for the
developing countries to assert their collective self-reliance,
Bcaring in mind the continuing importance of economic co-operation at the
sub-regional anJ regional levels .nd recognizing at the same time that ,the
developing count-ies should strive to identify and implement new forms of.
co-operation among, developing countries of different geographical regions and
at different levels of deveiopmcnt, and .to reinforce existing links among them
with a view to furthering the establishment of the new international economic*
order and bringing about a fundamental transformation of relations between the
developing and the developed countries,
Reiterating their conviction that responsibility for the development of
the developing countries rests on their own efforts, and that co-operation and
action among thrs- countries will accelerate the establishment of the new
J
international economic order based on equity, sovereign equality, interdependence,
common interest ard co-operaition among all States,
Mindful of the need to translate into practical action the concept of
collective sclf-re]iance and] -f the determination of developing countries to
reinforce their unity Aad cariacity for joint action,
1. Decides to adopt -, progrpmne ,of economic co-operation among developing
countries In accordance; *ntcr alias, with the Following objectives:
(a) Thc control of their mi-ans of development through the effective control
by the developing countries of their wealth, natural resources, systems of
production and other aspects of their economic activities;
(b) Expansion and diversification of their agricultural production in order
to achieve global .-eelf-sufficiency in food;
(c) Production cf their essential agricultural inputs, particularly
fertilizers And pesticides;
(d) Expansion of their export markets and increase of their export
earnings;
(e) expansionn ct a-l stages of the processing and transformation of their
raw materials;


74-033 0- 76 6











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(f) Expansion and diversification of their exports of manufactures and
semi-manufactures to other developing countries and to the market of the
developed countries;
(g) Overall increase in their level of technological development,
particularly by improving their technological capacity;
(b) Improvement of the human environment;
(i) Technical co-operation among developing countries, including
technical co-operation in the field of all sources of energy;
2. Considers that these objectives should be achieved through appropriate
and concerted action with a view to the adoption and Implementation of a
programme of economic co-operation. This should include a set of interrelated
measures designed to remove constraints imposed by limited skills, inadequate
technology, scarcity of investment funds, small domestic market rsand
insufficient transport, commercial and financial facilities. New links must
therefore be forged as regards trade, transport, money and finance,
agricultural, technical and scientific co-operation, together with a greater
degree of harmonization of Industrialization programmnes, of horizontal and
vertical commodity diversification programmes and of economic development
policies generally. This progranmme of economic co-operation should contribute
to the acceleration of the economic development of the developing countries and
to the diversification of their economic structure;
3. Agrees that such co-operation calls for the establishment and/or
strengthening of economic' integration between developing countries at the
regional and sub-regional levels together with economic complementarity and
concerted action at the inter-regional level as well as concerted action through
the setting up of consultations as regards economic policies with a view to
promoting new forms of joint action;
4. Decides that measures in this field should be aimed at:
(a) Strengthening and widening the scope of regional and sob-regional
community institutions;
(b) Improving the operation of existing instruments, in particular the
liberalization of tradr and common protection regimes;
(c) Emphasizing joint programmnes in industry, agriculture and
infrastructure;







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(d) Expanding sub-regional, regional and inter-regional economic
co-operation;
(c) Creating new economic co-operation groupings;
(f) Special measures .n favour of the least developed, land-locked and
island developing countries;
5. Recognizes that, in addition, a set of measures need to be designed
to strengthen the collective bargaining power of developing countries in their
export and import trade with the developed countries and their ability to
exploit more fully available opportunities in the markets of those countries.
To this end, developing countries should strengthen existing producers'
associations, create new ones whenever desirable and co-ordinate as far as
practicable the activities and policies of these associations;
6. Further recognizes that measures should be adopted in respect of
trade in manufactures nnd semi-manufactures, particularly with regard to
reduction of trade barriers among developing countries. The possibility of
formulating a general system of trade preferences among developing countries
should be explored. One way of contributing to the establishment of such a
system would be to launch a new round of comprehensive multilateral trade
negotiations among developing countries aiming at the extension of trade
concessions. The preferential system would involve wide product coverage and
could subsequently be expanded to cover non-tariff barriers and other aspects
of trRde policy. Such a comprehensive general system could ultimately
encompass, in a harmonized and mutually compatible manner, the existing and
proposed regional and sub-regional arrangements among developing countries,
due account being taken of the need to ensure a smooth transition from these
arrangements to the general system. The basic principles of the system of
tariff preferences would be non-discrimination and reciprocity, compatible
with the financial and trade requirements of each participating country. These
principles should recognize the need f9o.exceptions in favour of the least
developed, land-locked and island developing countries, including the
possibility of granting them unilateral concessions;
7. Agrees that measures of cc-operation in the field of trade among
developing countries could also include trade agreements which would stimulate
direct trade and cover, whenever possible, long-term purchase commitments;
the establishment and operation of commodity market exchange in developing
countries; and joint operations of State trade organizations;







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8. Agrees Further that the fellowinR measures should be considered in
order to allow the maximum utilization - supply in other develupini; countries;
(a) long-term agreements among developing countries for the supply and
the purchase of commodities, manufactures, services and know-how;
(b) Industrial integration ;.grccmcnts at the regional and sub-regional
levels and wider industrial complementarity agreements at the lnter-reSional
level in order to increase to the maximum the trade in manufactures and
semi-manufactures among developing countries;
9. Oecides chat the possibility of establishing or strengthening a
payments arrangement among developing countries should be explored in order to
accelerate th#. flow of mutual trade and serve as an instrument of their overall
economic co-operation. Co-operation in this field should be approached
initially by means of a network of clearing arrangements at the regional or
sub-regional levels through the linkage of these arrangements and the further
extension of these links into a global scheme among the different regions;
10. Decides that links between the service sectors of the developing
countries should be established or reinforced, with particular reference to
interconnexion of their transportation and communications networks, and
co-operation in respect of banking, insurance and credit;
11. Decides that the productive sectors should be 3tliuiai.3d through the
multinational complementarity of natural, managerial, financial and technological
resources .ind markets, particularly through Joint ventures and multinational
enterprises. Such arrangements could include financial in' technical assistance
for project inventories and feasibility studies of multinational projects, for
the development of industrial and technological information systems and :or the
promotion of technological research in the developing countries;
12. Agrec.: that measures should be considered to increase the
availability of capital on terms consistent with the promotion of co-operation
among developIng countries, including inter alia:
(a) Commnitments to provide the necessary resources for financing buffer
stocks;
(b) Promotion of prroganmmes for financial co-operation between countries
in a position to extend financial assistance on the one h.-ind and cointriles and
institutions re*.,uirirn,, such assistance on the other;







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13. Decides that, in the field of technology transfer, co-operation
should include:
(a) Increaseu flow OL LechnoLogies anu know-how adapteu or evolved in
the developing countries, taking into account the specific needs of each
developing country to fully utilize its sources of employment;
(b) Exchange of information and experience in respect of available
technologies, sharing of technical, economic and leCal information to facilitate
technology evaluation and negotiations of contractual arrangements leading to
the unpackaging of technology purchased from developed countries;
(c) Acquisition by the'developing countries of know-how available in
other developing countries as opposed to similar know-hew offered on equal
conditions by the developed countries;
(d) Technical assistance, in particular through exchange of experts,
advisory services, training courses, etc.;
(e) Utilization of services of engineering design consultancy firms in
those developing countries which could provide the appropriate technology and
ensure maximum component of indigenous equipment;
(f)' Collective efforts at joint projects for the acquisition and development
of technologies for utilization by more than one developing country;
(g) Strengthening national institutions in developing countries dealing
with technology transfers and establishing greater co-operation and co-ordination
among such institut-ons in order to reinforce the national technological capacity
of the developing countries;
(h) The elaboration of prcfcre-t" r-a.ngcments for the development and
transfer of technology among themselves; these preferential arrangements for
co-operation should, inter al.:, b3 consists.r; ..l ,... i& n.:s involving
sub-regional and regional co-operation and integration;
(i) The establishment of sub-regional and regional centres for the
development and transfer of technology which could serve as essential links
with national centres in developing countries, and also to implement
initiatives, such as:
(i) the exchange of information on technological alternatives available
to developing countries as a means of improving their negotiating power;
(ii) institutional arrangements in respect of common technological
research and training programmes;
V -







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(iii) assisting national centres effectively to fulfil their role,
inter alia, in implementing. a code of conduct for the transfer of
technology and preparing model contracts for licensing agreements on
patents;
(J) The establishment of sub-regional, regional and interregional centres
by the developing countries in specific and critical sectors of particular
interest to these countries;
IA. Decides to convene in Mexico City, during the month of September 1976,
an intergovernmental working group of interested developing countries for the
purpose of preparing the details of the programme for economic co-operation.
For this purpose they should be assisted, among others, by the UWCTAD secretariat.
2. The use of Arabic
The Third Ministerial Meeting of the Group of 77,
Recognizing that Arabic Is the language of 20 members of the Group of 77 and
an official and working language of the United Nations General Assembly in
accordance with General Assembly resolution 3190 (XXVIII),
Believing that the inclusion of Arabic as a working language of the
Group of 77 will strengthen and deepen the understanding and co-operation among
developing countries in their joint endeavour to establish the new international
economic order,
1. welcomess United Nations General Assembly resolution 3459 (XXX) to
include Arabic as ar official and working language;
2. Decides to include Arabic as an official and working language of the
Group of 77, and to amend the rules of procedure accordingly.
3. Assistance to the victims of the earthquake in Guatemala
The Third Ministerial Meeting of the Group of 77
Aghast at the catastrophe which has occurred in Guatemala in the form
of an earthquake that ha3 claimed countless lives, left thousands of persons
homeless and seriously affected the physical infrastructure of the country,
Mindful of the problems which the Guatemalan people are facing and the need
for help from abroad to alleviate the situation,
Resolves;
1. To offer its condolences to the Government and people of Guatemala and
publicly to express to them its sympathy and solidarity at this grievous time;







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2. To recommend that the Governments of the countries ot the Group of 77,
and the developed countries and international organizations, both official and
private, should with the utmost urgency provide the Guatemalan people with
the material assistance which they at present require, in particular as
regards medicines, food and clothing, using direct channels of communication
or acting through the Office of the United Nations Disaster Relief Co-ordinator.
4. Contribution of the Philippines to the common financing fund
of the integrated programme for commodities
The .Third Ministerial Meeting of the Group of 77,
Recognizing the fundamental role of commodities in the expansion of trade
and in the acceleration of the development of developing countries,
Bearing in mind the decision of the Third Ministerial Meeting concerning
the integrated programme for commodities,
Recognizing the importance of the establishment of a common fund for the
financing of international commodity stocks, which constitutes a key element
of the integrated programme, .G .
Welcomes with deep appreciation .the offer of
His Excellency Mr. Ferdinand E. Marcos, President of the Republic of the
Philippines, of a subscription of $50 million to initiate the establishment of
this fund, as a concrete expression of his Government's commitment to the
integrated programme for commodities.
5. Appeal to the President of. the Philippines to present the
Manila Declaration and Prograjmne of Action to the
fourth session of UNCTAD
The Third Ministerial Meeting of the Group of 77,
Having expressed its warm appreciation of the excellent arrangements made
by the Government and people of the Philippines for the holding of the
Ministerial Meeting,
Recalling the eloquent inaugural address of the President of the Philippines
on the opening day of the Meeting of Ministers of the Group of 77,
Inspired by his firm commitment and dedication to the cause of the
developing countries in the Group of 77 in pursuing the attainment of their
goals and objectives to secure for their peoples the blessings of a more
comfortable and prosperous living,
Conscious of his standing as one of the most devoted leaders of the
developing world,




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Addresses an appeal to His Excellency President 'arcos of the Philippines
to consider making .1 tri to Sairobl in early May this year to present to the
fourth session of l]ICTAD thL Manila Declaration and Programme of Action adopted
in Manila this seventh day of February 1976,
Requests the Prerident of the Ministerial Meeting to give the widest
possible publicity to the contents of this resolution.
B. DECISIONS
1. Admission of new members
The rhird Ministcrial Meeting of the Group of 77
Decides:
I. To acept Rcmanil as a member of the Group of 77 in the light of the
following criteria:
(a) The countries in question should agree to participate in the work
and positions of the Group of 77 in all forums and not only on specific topics
and aspects of international relations;
(b) The fact of c,,ntinuing to belong to the "B" or "D" lists would not
constitute a problem, provided that the country in question did not aspire to
elective offices;
(c) The initiatives of developing countries members of the Group of 77
which do not belong to .ny of the three regional groups should be endorsed and
channelled through Any one of them;
2. To accept Milti as a member of th- Group of 77;
3. That th, uecision to .idmit Malta and Romania should not in any way or
under any circumstances be considered as a precedent for the future;
4. That a working, group chaired by an African country should be
established by the Gioup of 77 to study and make recommendations on rules and
procedures for the admission of new members to be adopted by the Ministers of
countries members ol tche Crou:, of 77 at the fourth session of UNCTAD;
5. That Malt. and Romnania should as soon as possible take the necessary
steps which will enille h:m to bc a3,sociated fully with the Group of 77 and
to enjoy the fi'.ll rnL -f -emnxrship of that Group in keeping with
General Assembly resoTLtion t '.' 5 (XIX).







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2. Establishment of a secretariat of the Group of 77
The Third Ministerial Meeting of the Group of 77
Requests the Group of 77 in Geneva to establish a working group under the
chairmanship of the representative of the country holding the presidency of the
Third Ministerial Meeting to carry out a comprehensive study on the proposed
establishment of a secretariat of the Group of 77, including its terms of
reference and means of financing, and to make available the conclusions of the
study to member States before the Nairobi meeting.
3. Proposal to establish an interim committee
The Third Ministerial Meeting of the Group of 77
Decides that the proposal to establish an interim committee should be studied
further in the context of an eventual change in the organizational structure of
the Group of 77.
4. Co-ordina.tion between the Group of 19 and the Group of 77
The Third Ministerial Meeting of the Group of 77
Decides:
1. That arrangements should be made for the constant exchange and flow of
information between the Group of 19 participating in the Paris Conference and
the Group of 77 in Geneva and in New York;
2. That the Group of 77 in Geneva establish a liaison group composed of
the countries members of the Bureau of the Ministerial Meeting under the
chairmanship of the representative of the country holding the .,residency of the
Ministerial Meeting, to transmit to the Group of 19 such information and views
as the Group of 77 in Geneva or in New York may deem necessary for a more
effective participation of the Group of 19 at the Paris Conference;
3. That members of the Group of 77, wherever they may be meeting,
should keep each other informed on all matters of common interest.







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5. The future role of UNCTAD
The Third Minisrloril Mertin, of the Group of 77
Decides that:
1. At the Nairobi Conference, thz members of the Croup of 77 should
present .appropriate proposals to vest UJNCTAD with competence for the
negotiation, adoption nnd implementation of multilateral legal instruments In
the field of trade, development and related matters;
2. The Group of 77 in Geneva should establish a working group under the
chairmanship of the representative of the country holding the presidency of the
Third Ministerial Me-ting to formulate the necessary proposals mentioned above
and inform the member Governments of such proposals not later than the
forthcoming special session of the Trade and Development Board to be held in
March 1976;
3. The working group should consult with the Secretary-General of UNCTAD
in the formulation of the above-mentioned proposals.







83



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;Annex II
page I

,,NNEX II
OItC.Nl.'.ATTON/,L AM. OTHER ,ITTE.RS

The Mcetinp. of Iiinistrs of the Third !.inisteril1 Meeting of the
Group of 77 hcl' in innil. from 2 t(c 7 February 1976 was formally inaugurate!
nnd clc.sed by I.EL. ir. Fer,!inand L. Harccs, Presicdent of the Republic of the
Philippines.
The fleeting was attended by representatives of: .Afghanistan; Algerla;
Arf,entint; Bangladesh; lJhutan; Lolivi;.; :otswcna; iarazi ; Burundi;
Central Africen Republic; Chad; Chile; Colombia; Congo; Cuba; Cyprus;
Democratic Yemen; Ecuador; Egypt; Ethiopia; Gabon; Ghan.'; Guatemala;
Guinea; CuyAna; India; Indonesia; Tr,'n; Iraq; Ivory Coast; Jamaica;
Jordan; Kenya; KuwriL; Lebanon; Liberia; Libyan Arab Republic;
Madagascar; ihrlawi; Malaysia; Mali; Nalto; kturitania; i.auritius;
Hexico; Norocco; Nep.nl; Nicaragua; Oii.crin; Oman; Pakistan; Palestine
Liberation Or-anization; Panam..; Papua New Guinea; Peru; Philippines;
atarr; Republic of Korea; Republic of South Viet-NWm; Romania; Rwanda;
Saudi Arabia; Senegal; Sierra Leone; Singapore; Somalia; $rl Lanka;
Sudan: Surinam; Swaziland; Syrian ,Arab Republic; Thailand; Togo;
Trinidad and Tobago; Tunisia; Uganda; -United Arab Emirates; United
Republic of Cameroon; United Republic of Tanzenia; Upper Volta; Uruguay;
Venezuela; Yug;oslavia; .anire; "-mbin.
The following organizations attended as observers: Economic Commission
for Europe, E.oncmic Comnnissi-n for Latin America, Economic Commission for
Africa, Economic an, S ci."l Commission for Asia and the Pacific, United Nations
Conference on Tr.,Oe (-nd Development, United nations Industrial Development
Organization. Unite. tO'ptions Development Programme, Food and Agriculture
Organization c the United Nations, World iank, International Monetary Fund,
'!orld Intellectual Property Organization, Asian Clearing Union, Asian
Development Bank, Asian and Pacific Coconut Community, East AfricanCommunity,
Central ,ifrican Customs ant Ec.nomnic Uni-)n, Latin American Free-Trade
Association, Organization for .frican Unity.







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pa,,. 2

The meeting, electcl by ncclamatlon H.E. General C.'irlos P. Romulo,
Secretary of Foreign .Jffair.s of the Philippincs as its Prcsident and
H.E. Dr. J.G. Kiano, Minister ,f Commerce and Industry of Kenya, as its
Rapporteur-Genera 1.
The following, wcrc elicteu as Vice-Presidents:
H.E. i4r. Naurice Seri ,nolvba, Ivnry Coast; H.if. hr. Antonio Franck,
Central African Republic; H.E. fr. Belhadj /Aior Iloncet, Tunisia;
11.1'. Mr. C.i. Mwaanshiku, Iambia; H.E. Hr. 4"iljoJo Nitisastro, Indonesia;
H.L. ilr. T. llaz, artnc, Sri Lanka; H.E. Hr. iLbdul Rahman Allatyia,
Atar; H.E. Dr. Armando Pesantes, 3cuador; H.E. Mr. Frederick 1Iills,
Guy.ino; Lic. Elisec Mendoza rructo, Mexico.
On the proposal of the President, the Ministers decided to establish a
Co-ordination Committee consisting of ten members from each regional group
andi under the Chairmanshi? of Ii.E. Mr. Gabriel HMartinez of A-gentlna./
rhe meeting. established' fur main Conrmittees:
Committee I (Commodities (item 8); manufactures and
stmi- manufactures (item 9);
liultilateral trade negotiations (item 10(a))
Chairman: H.E. Mr. Kenneth Dadzie (Chann)
Vicc-Clhairman-cum-Piapporteur: Hr. .bel Garrido
(llexico)
Cconmittec II (Rcview of developments in the international
monetary field (item 10(*)1
Honey and finance rtnd the transfer of real
resources for development (item 11))
Chairman: H.E. Dr. Javad Vafa (Iran)
VicL-Chairman-cuin-Ropjorteur:
i.r. lfredo Enrique Vartas (Venezuela)


/ The membership of the Co-ordination Cornittee was as fcllows:-
;.frican Group: l'ieria, Senegal, E:;ypt, Kenya, Congo, Gabon, Ethiopia,
Horocco, Mauritania, Ghana, ;crin (ex-officie); Asian Group: Afghanistan,
India, Iran, Iraq, '.uwait, Philippines, Pakistan, United Arab Emirates,
Sri Lanka, Hallysia, In"'-An.,ln (ex-officio); Lrtin ,merican Group: Brazil,
Chile, Colombia, Cuba, Mexico, Nicaragua, Trinidad and Tobago, Uruguay,
Venezuela, Peru.







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,.nnex II
p!ai.-. 3

Comnittev 111 (l.cast d vclnoi', annion); the dJevulopin. countries,
developing; island countries and developing
land-locked countries (item 13);
Economic co-operation amont develupint;
countries (item 14))
Chairman: I:.Z. rr. (Miss) C.K.'. Chiepe (Botswana)
Vice-Chairman-cum-Rapporteutir:
Hr. r.!. Chowdhury (4,an.la'.lesh)
Committee IV (Transfer -f technology (item 12); Trade relations
am.n;; countries having different economic and social
systems (item 15); Review of institutional
arrangements in UNCTAi) (item lb))
Chairman; 11. 1.l.r. Herbert Alker (Jamaica)
Vice-Chairman-cum-Rapportcur:
fir. Sadic. Al-Kadde (Iraq).
The President, the ten Vice-Presidents and th< Rapporteur-General,
together with the Chairmen and Vice-Chairman-cum-Rapporteurs of the main
Committees and the Chairman of the Co-ordination Committee, constituted the
bureau of the fleeting.
The Ministerial i'ceting took note with appreciation of c report by the
'hairman of the Intergovernmental Group of 24 on the work done in pursuance of
the mandate iiven by the Second 4inistcri4l Ncctin(, 'f the Group of 77 in
Lima in 1971. In this connexion, the Oinisterial meeting recommended that
the Group of 24 continue its work on the developments in the monetary an!
financial fields in the light of the ';uiuolines adopted in -his connexion at
the Third Ministerial h'etini, at Mianila, which are contained in the Programme
of actionon ; and it also recor2nended the convening, as soon as possible, of
one or more ad hoc r.-ectings in conformity with the requirements of
international monetary reform in the light of the new international economic order.
A group of countries prepared a draft resolution on economic sanctions
against the racist regimes of South Africa, Rhodesia and Israel. The authors
of the draft resolution intimated their intention to present the draft
resolution te the fourth session of UHCTj'D.
ht its final meeting on 7 February 1q76, the Ministers adopted the Manila
Declaration and Prorr.mme tf action and a number of resolutions an,' decisions
which are reproduced in annex I above.














APPENDIX B



SPEECH BY SECRETARY OF STATE HENRY A. KISSINGER BEFORE
THE FOURTH MINISTERIAL OF THE UNITED NATIONS CON-
FERENCE ON TRADE AND DEVELOPMENT, MAY 6, 1976


UNCTAD IV: EXPANDING COOPERATION FOR
GLOBAL ECONOMIC DEVELOPMENT


Secretary l!enr,. A. Kissinger before the Fourth
Ministerial Meeting of the United Nations Confer-
ence on Trade and Development (L'UNCTAD).

We are assembled here to carry forward one
of the most important enterprises in history-the
endeavor of independent nations to advance global
economic development and so to better the quality
of human life on Earth. Our goal is nothing less
than to shape an enduring structure of interna-
tional collaboration that offers peace and prosperi-
ty, equal opportunity and dignity to all peoples.
Man has always yearned for peace and a just
international order. In our time these twin goals
have become a realistic possibility. Their attain-
ment % ill require us to meet challenges whose scale
eludes the grasp of individual nations, whose com-
plexity mocks the slogans and solutions of the
past, and whose pace outstrips the measured
processes of traditional diplomacy.
There is before us all the imperative of world
stability-the task of resolving conflicts, reducing
tensions, and resisting the encroachment of new
imperialisms, new oppressions. and new dangers.
For this undertaking the United States, together
with other nations, has assumed a heavy responsi-
bility.
Beyond it lie our positive aspirations. The
American people are a humane people. We know
that stability is not enough; peace must extend
mankind's reach for a better life. In the Dedlura
tion of Independence of the United States, the
seminal document of our national existence, we
PR 224


have written that"... all Men are created equal..."
and entitled to ". Life, Liberty, and the Pur-
suit of Happiness. .. This pursuit has brought
me to Nairobi-to advance on behalf of President
Ford and the US. Government the great cause we
all hold in common.
In the long sweep of history, the future of
peace and progress may be most decisively deter-
mined by our response to the necessities imposed
by our economic interdependence. This is the chal-
lenge which we have assembled here to address-
the urgent need for cooperative solutions to the
new global problems of the world economy. These
issues dominate the agenda of the evolving rela-
tionship between North and South, the industrial
and the developing countries.

They are issues of economics-of an effective
system of trade, monetary relations, and develop-
ment assistance and of insuring that the prosperity
of some nations does not come at the expense of
others.
They are issues of politics-of how nations
deal with each other and of how we can construct
an international order that promotes peace.
They are issues of morality-the recognition
that economic might does not make right.
And they are issues of justice-the awareness
that the well-being of our peoples depends upon
an international system fair and open to all.

The modern age and our common morality
insistently demand respect for human dignity and


(86)







87


the fulfillment of the human personality. But a
world in which poverty and misery continue to
afflict countless millions would mock these impera-
tives. The daily preoccupation of men and women
would be the harsh necessities of survival; the ener-
gies of nations would be consumed in hatred and
rivalry. We must build, instead, a world of coopera-
tion and widening human opportunity reflecting
the fundamental interdependence of our destinies.
Today the accelerating forces of moderniza-
tion-technological, economic, social, and politi-
cal-link the peoples of the world as never before.
They can intensify conflict or they can provide us
with unprecedented possibilities to advance our
common aims. All nations are part of a global
economic system. If that system is to flourish it
must rest on the firm foundation of security, fair-
ness, and opportunity to all who wish to partici-
pate-rich and poor, North and South, consumer
and producer. It must embrace the interests of all
if it is to be supported by all. President Ford has
sent me here committed to bring about a construc-
tive and cooperative relationship between the
developed and the developing countries over the
remainder of this century.
This Ministerial Meeting of UNCTAD is the
first of its kind to be held in Africa. This is alto-
gether fitting, for Africa's importance in world af-
fairs is growing. And African countries have an
especially high stake in a successful conference
leading to concrete progress. No continent has
been more vulnerable to worldwide economic in-
stabilities. No continent suffers so cruelly when
crops fail for lack of rain. No continent endures a
heavier burden when commodity prices fluctuate
violently. And no continent has more to gain from
the organized cooperation of all nations to pro-
mote economic and social progress and to insure a
greater role for the developing nations in the
world's economic deliberations.
This is a continent of proud traditions and
new nations, of rising aspirations, and of deter-
mination in the face of monumental challenge.
Here it can-indeed it must-be demonstrated that
men of all races and colors can live and prosper
together in peace with equal rights and mutual
respect.
During the past two weeks I have been privi-
leged to be a guest in Africa and to enjoy the extra-
ordinary hospitality of its people and leaders. I


have greatly benefited from my discussions with
African statesmen, and I have learned much about
the concerns and hopes of the peoples of Africa.
The nations of this continent can be confident that
the United States is prepared to cooperate with
them in their great struggles for justice, economic
progress, and freedom from external intervention.
Today we are all especially indebted to the
Republic of Kenya and its world renowned leader,
President [Jomo] Kenyatta, for making this beau-
tiful city available as the site of this conference.
The U.S. delegation has come to Nairobi to
achieve, with representatives of other nations, a
major step forward in international cooperation.
We begin this conference at a moment of
opportunity. The world economy is recovering
from a deep recession-my own country perhaps
most rapidly. Increasing American demand for
products of other countries will make a major con-
-tribution to recovery around the world. Many
obstacles to sustained economic growth remain;
but there are convincing signs that we have sur-
mounted the worst part of the economic crisis and
that before us, if we act with wisdom and energy,
is the opportunity for a new and prolonged period
of prosperity.
This, therefore, may be a decisive moment
which offers us a brief, but special, opportunity to
reinvigorate and improve the world's international
economic system. Now is the time to free the
world from disruptive cycles of boom and bust and
to enhance the opportunities of the developing
countries.
The United States, better than almost any
other nation, could survive a period of economic
warfare. We can resist confrontation and rhetorical
attacks if other nations choose that path. And we
can ignore unrealistic proposals and preemptory
demands. But the historic opportunity which is at
hand would slip away. It is up to us, as the spokes-
.men of nations meeting in this world forum, to
reach beyond the doubts and temptations of the
moment toward the permanent international
interests of us all. In so doing we can take courage
from the knowledge that the means exist to
achieve a brighter future. It lies within our power
to shape a world where all men can live in dignity
and aspire to progress.
Let us, therefore, hold before us as the goal of
this conference, and of the dialogue between








88


de' eloped and developing nations, the motto of
the Republic of Kenya: "Harambee-work together
fr the gu,.-d of all "
Let us begin b% building on the positive ac-
complishments of the Seventh Special Session of
the U.N. General Assembly last September. At that
meeting the industrial and deeluping na'i,.ns, in
an enc'mraging demonstration of connwrnuus, put
aside idet-lo, ir.i! : 'nfz,-ntjti(,n, declared 'heir
common purpose of moving forward t,,,operjtisel.N,
and adupted an agreed agenda for action.
On behalf of President Ford. I call upon this
conference to accelerate the efforts and continue
the cooperative spirit which began then. I ,ill
introduce new proposals on all the priority con-
cerns of this conference to reflect what we have
heard of \sur ideas and .our aspirations in the
Manila declaration and in other forums, including
the Conference on International Economic
Cooperation (CIEC] in Paris.
These proposals represent the 'ontrnbuii.,ns
..f ill relevant agencies of the U.S. Government
under the direction of the President. I have worked
rspeciall closely with my colleUague, Treasury
Secretary Simun. in shaping the program we are
prt-Ti. nli igi
The trcjng bipartisan support which our ap
proach tnjo,.s results ftum weeks of close con-
sultations between the F.XCeu live and both Houses
of our C. ngrc,. It is demonstrated bN the presence
here of two distinguished Senatjiors representing our
two political parties jJacob K.Javits and Abraham
A. Rilt-.diJ. Other Senators and members u-f the
House of Representatives will follow as your work
proceeds.
The United Stites plcd(ics its dedlitatin and
illrii less to (,iipcrarte over the decades ahead.
We do so with an open mind. We want to hear your
ideas and prWpeal \W' are here to c\Lh.ingc views
and to firLc a fresh consensus.

The State of Our Effort,
Let me I ir, review what our nations together
have achieved since last Septcmbier

\% C aLrf I'l at the Seventh Special Session to
take measures to help insure basic economic securi-
ty i..ii,t \ cycles that devastate export '.ttiMil'i and
undermine dl 1-i,,pmcCi1 In J.1riiiru1 the Interna-
tional Monetary Fund expanded its compensatory


financing facility\ as we had proposed, to make
.a ailable several billion dollars to stabilize export
earnings.
In September we pledged to accelerate
economic growth by improving developing coun-
tries' access to capital and new technoloUgy'. To
these end, the United States. other industrial coun-
tries. and several ,il-producing countries have be-
gun to marshal increased capital, technological, and
human resources to promote development. Nego-
tiations have been completed to increase World
Bank capital by S8 billion, we will contribute our
fair share to a S6 billion increase in the resources
of the Inter-American De\elopment Bank: we will
contribute to an expansion of the Atrican Develop.
meant Fund: we are actively participating in discus-
sions on replenishment of the Asian Deielopment
Fund and Bank.
At the -pecial session the world community
dedicated itself to improving trade and investment
in key commodities. International solutions have
adrcadv been achieved on several key commodity.
issue,, including the successful negotiation of cof-
fee and tin agreements. Progress is also being made
in pendingng the world's supply of its most vital
commodity-food.
And finally at the special session, the world
community made a commitment to meet the
spe< al needs of the poorest countries which have
suffered the most from recent economic disloc.a-
tions. We have made significant progress by provide.
ing financial and technical assistance to increase
food production and by introducing new measures
to help relieve crushing balan(e-f-pa\ mcnits prob-
lems of the poorest nations.

I hes achievements are only the heginniiik: of
the process. We are-this year-in the midst of what
m.i\ well be the most extensive series of interna-
tional itnN'iti. li 'is on I rade. finjnt Ci c Inmmii'ditirs,
and dcvelipment in history inuol ing more na-
lions,. addrssing more issu-s, and affecting more
peplh than ever before. This coinfeernte has a
mnaJi. role to pl.i\. In particular we can advance
our work in four kc\ areas:

First, we must make renewed efforts on com-
modity issues, including the problems of resource
investment and trade. Cimmidittics e:irg', fOI>L1.
and other prim.ar\ products are the building







89


blocks of growth and prosperity. For many coun-
tries development of resources is the key to indus-
trialization, employment, decent incomes, and
healthy diets. All nations need adequate supplies of
primary products and fair compensation for their
production. Solving the complex of these issues is a
critical test of our ability to work together sys-
tematically to expand the world's wealth for the
benefit of all.
Second, we must design a far-reaching long-
term program to accelerate technology transfer.
The quantity of capital investment by itself does
not assure sustained development. There must be,
as well, continuous improvements in productivity
that only new technology and trained local man-
power can bring. Comprehensive efforts are crucial;
the subject deserves high priority and comprehen-
sive efforts will be required.
Third, we must deal with serious balance-of-
payments and debt problems which face a number
of developing countries. Rising import costs-
caused in large part by higher oil prices and re-
duced export earnings due to recession in industrial-
ized countries-have created unprecedented inter-
national payments problems. An improved world
economy will automatically ease the problem for
many countries. Nevertheless we must continue to
seek means of assistance for the particular prob-
lems of certain developing countries.
Fourth, we must continue to respond to the
special and urgent needs of the poorest countries.
Helping these nations will demonstrate not only
the capacity of the international economy to serve
all countries equitably; it will also reflect our col-
lective sense of responsibility.

Let me now suggest specific new approaches
for dealing with each of these four problems.

A Comprehensive Approach to Commodities
Commodity exports are critical for develop-
ment. The non-oil developing countries rely on
primary products for nearly two-thirds of their
export earnings. Yet production and export of
these resources are vulnerable to the whims of
weather, the swings of worldwide demand, and
new technology. Cycles of scarcity and glut, under-
investment and overcapacity, disrupt economic
conditions in both the developing and the indus-
trial world.


It has become clear in recent years that a
piecemeal approach to these issues will not suffice.
The UNCTAD Secretariat has made an important
contribution to meeting these problems in its
integrated commodity program. While the United
States cannot accept all of its elements, there are
many parts which we are prepared to consider.
At this conference the United States proposes
its own comprehensive approach to commodity
issues. It reflects many of the objectives contained
in the integrated program and our desire for con-
structive action on all aspects of the challenge. It
contains the following elements:

Insuring sufficient financing for resource
development and for equitable sharing in their
benefits by the host nation;
Improving the conditions of trade and invest-
ment in individual commodities and moderating
excessive price fluctuations;
Stabilizing the overall export earnings of de-
%,eloping countries; and
Improving access to markets for processed
products of developing countries while assuring
consumers reliability of supply.

Let me discuss each of these elements in turn.

Adequate Investment. Most of the world's
raw material production, in fact, takes place in the
industrial countries. But if development is to take
hold, a special effort must be made to expand the
production and exports of primary products of
developing countries. Such a program must over-
come the following problems:

First, we must deal realistically with the polit-
ical and economic problems which are diverting
investments from developing to developed coun-
tries. For paradoxically resource development is
often discouraged by the very countries which are
most in need of it. Nationalization and forced
change in the terms of concessions in some devel-
oping countries have clouded the general climate
for resource investment in the developing world.
Social and political uncertainties have further com-
plicated investment prospects. As a result commer-
cially viable projects have been postponed, can-
celled, or relocated, and capital, management, and
technology have been diverted to production of


74-033 0 76 7







90


higher cost raw materials in the industrialized
world.
Second, in the next decade alone the total
requirements for global investment in resources
will be massive. Individual projects will require
unprecedented sums of capital and complex finan-
cial arrangements. The time required between the
beginning of a project and its completion is in-
creasing. All these factors compound the political
uncertainties and further inhibit rational invest-
ment.
Third. there is no one institution that can
work comprehensively to facilitate resource devel-
rpment. particularly in energy and minerals, or to
promote equitable sharing of its benefits.
If present trends continue, serious misalloca-
tions of capital, management, and technology are
inevitable. The costs of raw material and agricul-
tural production will escalate. Many potential
producers will be unable to attract adequate capi-
tal. All countries will pay the price in accelerated
inflation and retarded growth-with the poorest
countries suffering the most.

To overcome these problems the United
States proposes the establishment of an Interna-
tional Resources Bank [IRB]. This new institution
would promote more rational. systematic, and
equitable development of resources in developing
nations. It would facilitate technological develop-
ment and management training in the developing
countries. It would help insure supplies of raw
materials to sustain the expansion of the global
economy and help moderate commodity price fluc-
tuations.
The International Resources Bank would
mobilize capital for sound resources development
projects by assisting individual resources projects
to secure dire t financing and issuing bonds which
could be secured by a specific commodity. Alterna-
tively these bonds could be retired through de-
livery of a specific commodity. "Commodity
bhond" of this type could greatly improve condi-
tions of supply% and market access and help devel-
.,pinz countries to stabilize export earnings.
To enhance confidence for both host govern.
ments and investors the International Resources
B ink would begin operations with a capital fund of
SI billion. It would participate with foreign inves-
tors and the host government in project agreements


specifying the conditions of the investment on a
basis acceptable to all parties. Such an agreement
could include a formula for production sharing and
arrangements by investors to help develop the
managerial, technological, and marketing capabili-
ties of the host country. The bank would support
guarantees of both investor and host nation per-
formance in accordance with conditions estab-
lished in the project agreement.
To insure effective coordination with other
public institutions, the International Resources
Bank could be associated with the World Bank
group, in a form to be worked out by the partici-
pating countries. It could operate in close col-
laboration with-and render even more effective-
other institutions such as the World Bank and its
associate, the International Finance Corporation,
and the Inter-American Development Bank as well
as the U.N. Revolving Fund for Mineral Explora-
tion. The I RB proposal offers many advantages and
new concepts.

Its facilitating role as third party with the
host country and the foreign investor will en-
courage conditions for project development con-
sistent with internationally accepted standards of
equity .
The IRB mechanism provides multilateral
guarantees of the performance of both the host
nation and the foreign investor in accordance with
the project agreement-thereby reducing the
noncommercial risks. This cannot fail to promote
greater flows of investment capital for resource
projects on reasonable terms.
The proposal contemplates production-
sharing arrangements under which the foreign
investor is assured of an established percentage of
total production with disposition of the balance to
be controlled by the host nation. This allows the
host nation to share in production from the outset,
providing it with the basis for further processing of
the raw material should this prove to be economi-
ically feasible.
Commodity bonds would be a fruitful new
international instrument for forward purchases of
commodities. They could contribute to earnings
stabilization. They would also provide added as-
surance of market access for the host country and
supply access for the consumer.
Finally, through the IRB, modem technology












would flow into developing nations. The two key
elements required for development-management
and technology-are provided by the foreign in-
vestor directly in a new form of capital investment.
The trilateral agreement could include provision
for the progressive acquisition of technology by
the host country and thus contribute. importantly
to the process of technology transfer.

We consider the International Resources Bank
to be an innovative and significant response to the
basic needs of the developing nations and the inter-
national community. It will be a major advance in
the sharing of benefits and responsibilities between
industrialized and developing nations. It will help
insure the essential flow of capital, management,
and technology into resource development under
conditions acceptable to host governments. And it
will enhance the predictability that is essential to
attract capital investment. We hope other countries
will join us during the coming months to design
and establish this global institution.

Improvement of the Conditions of Trade and
Investment in Individual Commodities. We are all
conscious of the problems the world economy has
faced recently in this area. Within only two years
the tight supply and astronomical prices of many
critical materials have been followed by a period of
declining prices. Many economies have been severe-
ly shaken, and several countries have suffered
balance-of-payments crises. Drastic price changes
affect the developing countries most severely,
playing havoc with foreign exchange earnings and
development plans. And because raw material
production projects require years to develop and
involve high risks, volatile prices tend to lead to
erratic patterns of investment.
There are a number of ways to improve
commodity markets-long-term contractual
arrangements, better exchange of market informa-
tion, improved distribution, more efficient produc-
tion methods, and better storage and transport
facilities.
We agree with the UNCTAD Secretariat that
buffer stocks deserve special attention. For those
commodities where buffer stocks are feasible,
sharp fluctuations in prices can be moderated by
building stocks when markets are weak. And
adequate supplies at reasonable prices can be as-


sured through releasing stocks when markets are
tight.
The United States believes that buffer stocks
can be financed from a combination of sources-
direct contribution by the participants, export
taxes, commercial borrowing guaranteed by the
countries participating in the buffer stock, or
through the existing facilities of international
institutions. Should existing sources prove inade-
quate we would also be prepared to consider the
IRB as a supplemental channel for financing a
particular buffer stock. In these ways we are con-
vinced that adequate international financing for
buffer stocks can be assured within the context of
the specific commodity agreement under which the
stock is established. Clearly the United States
would not want a buffer stock in which we had
agreed to participate to fail for want of adequate
financing.
The United States has pursued a constructive
approach to other aspects of the commodities
problem.

We have joined with producers and con-
sumers of key commodities to agree on measures
to improve and stabilize markets.
We have signed commodity agreements on
coffee and tin, and we will participate in nego-
tiations on sugar. We viewed cocoa as well-suited to
a buffer stock arrangement but were disappointed
in the agreement negotiated a few months ago
which we believe is unlikely to improve the func-
tioning of the cocoa market. If other parties are
interested, we stand ready to renegotiate this agree-
ment.
The United States recently participated in
the first meeting of producers and consumers of
copper. We look forward to the establishment of a
permanent producer-consumer group.
Agicultural raw materials need serious atten-
tion as well. Those that face declining markets
from growing competition from lower-cost pro-
ducers and synthetics can benefit from market
promotion, research to improve productivity, and
marketability or diversification into other
products. We recommend that producer-consumer
forums dealing with individuals commodities focus
on such possibilities. We urge that the World Bank
and the regional development banks give high
priority to funding projects for these purposes.







92


Today the United States proposes these
additional measures:

First, let us reach agreement on a definite
timetable for the study of specific commodity
problems of interest to developing countries. We
are prepared to initiate concerted consideration in
producer-consumer forums this year of measures to
improve the stability, growth, and efficiency of
markets for all ke\ developing countries' commodi-
ty exports. Particular attention should be given to
the formation of groups for bauxite and iron ore.
I Second, since many of the poorest countries
are dependent on these products for export earn-
ings, we urge the World Bank and regional institu-
tions to sponsor projects to improve production
efficiency and markets for jute, sisal, and other
hard fibers-or to facilitate diversification into
other products in order to reduce excessive reliance
on them.
Finally, any program of resources develop-
ment must emphasize the two most vital interna-
tional resources-food and energy. Forecasts of
good harvests must not lull us into letting the
progress begun at the World Food Conference slip
away. At that conference nations agreed to work
toward a system of world grain reserves to improve
food security, to increase support for agricultural
research, to develop programs for nutritional im-
provement, and to increase agricultural develop-
ment in low-income countries.

We urge other countries to join us to make
the concept of world food reserves a reality, to
increase support for agriculture development in
poorer nations, and to provide necessary food aid.
In energy we strongly support the efforts of
oil producers and consumers from both the indus-
trialized and the developing world to achieve
cooperative solutions at the Conference on Inter-
national Economic Cooperation. We urge that our
proposal for an international energy institute-
which would help developing countries take ad-
vantage of their domestic energy resources-receive
priority attention in the months ahead.

Stabilizing Export Earnings of Developing
Countries. At the Seventh Special Session, the
United States listed as its first priority the need to
insure economic security for the developing world.


We continue to believe that the world economic
system must provide the developing nations greater
security from the worst effects of fluctuating
prices, recession, inflation, and other economic
shocks which they are helpless to prevent or avoid.
We are gratified at the rapid implementation
of our proposals to the special session for the far-
reaching expansion of the International Monetary
Fund. These innovations make available billions of
dollars in new financing to offset steep declines in
export earnings. The most significant step forward
has been the Fund's agreement to liberalize its
compensatory financing facility. As of now
roughly $800 million from this improved facility
has been provided. If this rate continues, more
money will have been lent this year from the
facility than the entire amount provided over the
last 12 years.
Another major advance has been the estab-
lishment of an IMF trust fund to help meet the
balance-of-payments needs of the poorest coun-
tries. While many developing countries have
received substantial benefits from the compensa-
tory financing facility, low-income countries,
whose export revenues depend on one or two
commodities, often need additional financial help
to meet balance-of-payments problems. To assist
the poorest countries the United States has pro-
posed that the trust fund provide concessional
financing to poorer countries to offset declines in
earnings from an agreed list of particularly signifi-
cant commodities.
Moreover the United States would be ready to
join others in a review of the adequacy of the trust
fund's resources, should they prove inadequate to
stabilize earnings and thus provide general balance-
uf-payment financing for low-income developing
nations. We especially urge those oil-producing na-
tions with strong reserves to contribute to the trust
fund's lending capacity.

Expanding Trade in Resources and Processed
Goods. Trade has been an engine of growth for all
countries; for many developing countries it is the
most critical vehicle of development. The United
States has taken a number of initiatives to meet the
special needs of developing countries. We have
reduced global trade barriers, especially those af.
fecting processed goods; provided preferential ac-
cess to our market for many exports of developing