New York was the venue for the most recent meeting of the SI Committee on the Economy. Social Cohesion and the Environment on 15-16 February, when its members gathered at the headquarters of the United Nations.
The Committee, chaired by Christoph Zöpel of the Social Democratic Party, SPD, of Germany and Chair of the Committee, addressed the International's position on the forthcoming International Conference on Financing for Development to take place in March in Monterrey, Mexico, and on the World Summit on Sustainable Development in August-September in Johannesburg. A Statement was issued on the first item on the agenda, and points for discussion in relation to the Johannesburg Summit were agreed.
Committee members also continued the discussion of main themes set out in its agreed programme of work, on this occasion 'Governance in a Global Society: The Reform of the International Institutions and the Participation of Citizens, Democratic Parties and Parliaments' and 'The Quest for Identity in a World without Borders'.
Special contributions on the main items of the agenda were made by Mats Karlsson, World Bank Vice-President for External Affairs and United Nations Affairs, and Oscar de Rojas, Executive Coordinator of the Financing for Development Secretariat, on the Monterrey Conference; by Jeanette Ndhlovu, Deputy Permanent Representative of South Africa to the UN, on sustainable development and the Johannesburg Summit; and, by Ambassador Cristián Maquieira of the Mission of Chile at the UN, and by Marta Maurás, Director of the Office of UN Deputy Secretary-General, Louise Fréchette, on the reform of the United Nations.
The Socialist International welcomes the Monterrey Conference and wants to contribute to its success. The Monterrey Conference offers the opportunity to mobilise the necessary funds for international poverty alleviation. In the Millennium Declaration of the United Nations of September 2000, heads of state and government of the member states of the United Nations confirmed their intention to cut the number of people living in severe poverty by half by the year 2015. For this purpose many governments have set in place action programmes defining their contribution to this worldwide endeavour. The Socialist International calls upon all countries to work out national 2015-action programmes of this nature.
The draft for the final document of the FfD Conference, the "Monterrey Consensus", which was agreed upon on 28 January 2002 in New York at the end of the fourth and last preparatory meeting of the member states of the United Nations, contains a comprehensive list of demands and expectations for developed countries, but also for the developing countries and countries in transformation which are to be fulfilled on the basis of a "new partnership". In this way the 21st century could be turned into a century for the "development for all". The SI advocates these justified demands.
However, the SI deeply regrets that so far no real effort has been made to include the views of parliamentarians in the Monterrey Consensus. To the extent that many of the recommendations included in this consensus had to do with improving the legal framework of the financial sector (banking, insurances, pension funds) which are the main responsibility of parliaments we believe that an extraordinary effort should be made to include their views.
In the first part, mention is made of the demand for a stronger mobilisation of national financing for development. This requires a determined fight against the waste of public funds and against corruption, the establishment of a smooth running bank system - especially for micro credits as well as for small- and medium-sized enterprises - the improvement of bank supervision. But it is equally important to reorganise and reform state-owned banks, as well as avoiding the exodus of capital and tax evasion, guaranteeing consistency of the law for business transactions, gender equality, protecting the rights of employees and the environment. In addition to that, for the developing countries and countries in transformation it will be extremely important to reduce the transaction costs for bank transfer payments of guest-workers to their countries of origin and the promotion of housing. The Socialist International supports these demands. It deplores the fact that the FfD document does not explicitly mention the core labour standards of the International Labour Organisation (ILO) due to the opposition of some developing countries and the United States.
It lacks a stronger acknowledgement that domestic policies in themselves will not achieve development unless systemic constraints in the international economic and financial system are adequately addressed.
The second part deals with the mobilisation of international resources for development. This first and foremost concerns the establishment of the appropriate framework conditions for foreign direct investment. In the developing countries a transparent, stable and predictable climate is needed that is conducive for investment based on agreements for the promotion of investment, for the protection of investment, guarantees for capital investment, conventions on double taxation, co-financing, venture capital, export credits and other forms of financing. Investors should not only consider their legitimate personal interests to generate revenues, but also respect social and environmental standards. Public-Private partnerships for improving the infrastructure, for example in the field of information and communication technologies, water and energy supply, could be one but not the only means for improving the conditions for investment.
The Socialist International is in favour of introducing effective transaction regulations (which could take the form of better institutions, international taxation etc.) for cases of an excessively volatile short-term outflow and influx of capital and it holds the view that developing countries should not be urged to liberalise the balance of capital transactions if the financial sector in their country is not yet ready for it. The example of China shows that intensified trade and high growth rates can be achieved with foreign direct investment without the complete liberalisation of the balance of capital transactions.
We would wish that the document would further support developing countries' own path of development by allowing for appropriate capital account regimes and for capital account taxes and controls. As another key issue the promotion of labour and environmental standards should be complemented in the document and become an integral part of the FDI chapter.
We would strongly recommend that enhanced efforts to control tax havens be made.
The third part considers trade as a big source and driving force of development. For the countries that have developed to a certain extent and which receive no or very little development aid, the participation in world trade constitutes the most important basis for development, because the scope and intensity of foreign direct investment is determined by their possibilities to export their products. The Socialist International supports the recommendations for stronger participation of developing countries in world trade, especially in connection with the reduction of production and export subsidies for specific agricultural products in the EU and the United States.
In addition, the Socialist International favours free access for products without tariffs and quota with the exception of exports of weapons from the least developed countries (LDCs) to the markets of industrialised states, the "Everything But Arms Initiative". The member states of the European Union have already committed themselves to this initiative and Japan has also already made a similar declaration.
The new round of world trade negotiations, which was given the green light during the Fourth ministerial conference of the WTO in Doha, has to be turned into a "development round". The integrated programme of the LDC III conference in Brussels for the promotion of exports from the least developed countries needs to be complemented by additional measures for trade-related technical assistance for all developing countries.
The Socialist International calls for an evaluation of the regulatory framework for trade, including its impact on poverty reduction, food security and the protection of workers and the environment. The instability in commodity prices and export revenues of developing countries and different risk management mechanisms to tackle these issues should be another area of concern.
Fourthly, the Socialist International supports the recommendations on a necessary increase of official development assistance (ODA) to 0.7 per cent of the gross domestic product (GDP) of the developed countries for the improved efficiency of financial and technical cooperation for development. The Socialist International advocates the goals of the Millennium Declaration of the UN General Assembly and the report of the Zedillo Commission which stipulated that the ODA should at least be doubled to 100 billion. US dollars every year in order to be able to reduce international poverty by half by the year 2015. This is still far away from the 0.7 per cent which the United Nations determined as a general objective some 30 years ago. The developing countries have not yet accepted the intermediate goal and call for compliance with the 0.7 per cent objective in the Monterrey declaration. The OECD member states have committed themselves to this goal with the exception of the United States. The heads of state and government of the EU during their meeting in Laeken (Belgium) on 15 December 2001 approved a study on the analysis of the funds and the time periods with which each member state could reach the objective set by the United Nations. Because of the fact that up until now only some of the smaller European states, namely Norway, Denmark, the Netherlands, Sweden and Luxembourg, have reached this goal. The SI now appeals to the larger EU member states run by social democratic governments, namely Germany, France and Britain, to set in place time schedules and implementation programmes to achieve the UN goals and to take precise steps leading in this direction. Without increased assistance on the part of the OECD member states it will be the poorer developing countries especially which will not be in a position to use the opportunities provided by the mobilisation of national resources, the international transfer of capital and international trade in order to fight poverty. The Socialist International urges that at least 0.2 percent of GNP goes to the least developed countries.
The SI criticises the lack of commitment in the Monterrey Consensus document to higher aid levels, which should be addressed by the socialist parties. Aid levels should be immediately increased and a timeframe for meeting the 0.7 per cent target is necessary. It should be ensured that the timeframe is consistent with the deadline for achieving the Millennium Development Goals. Within this framework, programmes oriented to raising educational skills and some professional capacities as well as basic transportation infrastructure should get priority.
The fifth part of the Monterrey Consensus advocates the continuous implementation of the debt relief programmes initiated during the Cologne G8 summit for the highly indebted poor countries (HIPC) and a reduction of the debt burden for other developing countries within the framework of the Paris and London Clubs. The Socialist International supports the efforts made by certain OECD countries, the World Bank and regional development banks but urges them and especially the IMF to assist all the highly indebted developing countries threatened by financial crisis in overcoming their debt problems.
Debt relief should be emphasised in HIPC and should be conditioned on respect for basic human rights and extension of democracy.
The Socialist International supports the questions concerning the system raised in the sixth part of the Monterrey Consensus. It advocates the leading role of the United Nations in representing the interests of the developing countries, especially the strengthening of the role of the General Assembly and the Economic and Social Council (ECOSOC). It favours a stronger participation of the developing countries in the international financial institutions and the World Trade Organisation (WTO). Further discussions and decisions concerning quota or voting rights are necessary. The SI favours a reform and strengthening of the international financial architecture specifically in relation to preventing and overcoming financial crises, a stronger involvement of the International Labour Organisation (ILO) in the solution of the social problems of globalisation, the intensification of international cooperation with regard to taxation and the fight against money laundering, drug trafficking, corruption, international organised crime and the financing of terrorism. An increased coherence of policies at the international, but also at the national, level is essential for the follow-up process of the Monterrey Conference. The "global alliance for development" that the heads of state and government at Monterrey have to commit themselves to deserves the fullest support of all the parties of the Socialist International, of civil society, the trade unions, the employers and of every individual with a certain amount of good will.
The SI expresses concern that despite numerous financial crises and the recent turmoil in Argentina the Monterrey document claims that "important international efforts are already underway to reform the international financial architecture". Moreover, it should be addressed that the international financial institutions have to engage in a participatory review of their deliberative bodies to ensure equitable participation of developing countries. Also, that the WTO will ensure that its full membership will be properly represented in all its bodies and working groups. The role of the UN on global economic issues should be strengthened and it should obtain the mandate to design innovative mechanisms for enhancing democracy in global economic decision-making.
The Socialist International Committee on the Economy, Social Cohesion and the Environment, meeting in New York on 15-16 February 2002, discussed the preparation of the forthcoming World Summit on Sustainable Development in Johannesburg, and noted a series of points in this regard:
• International security, peace and democracy are strongly related to social justice, international public goods and solidarity.
• There is a need to shape the globalisation process to be inclusive and create a world domestic policy.
• Sustainable development consists of three dimensions: economic, social and environmental aspects. All these three aspects have to be given consideration in a comprehensive context. Sustainable development with its principles and rules is a matter of creating a clear solidarity between generations and countries.
The Socialist International wants to make its contribution to the successful outcome of the Johannesburg Summit. It is aware of, and welcomes, the work done by its member parties and organisations on sustainable development. The SI calls on all its parties and its members in parliament and government to cooperate and move towards firm and innovative initiatives in order to promote sustainable development. The SI expects from them concrete commitments to funding and implementing these initiatives. In this regard, the Socialist International will open a discussion also with all those, people or movements, who oppose the present form of globalisation. The SI is expecting the proposals of the PES on sustainable development due to be published on 15 March. It also supports the proposal of the USFP of Morocco that the Johannesburg Summit should deal with the implementation of the commitments agreed at the Copenhagen Summit on Social Development.
Essential for the achievement of a more sustainable development is the political will to act, finding the right tools to implement the agreements, and strengthening partnerships.
The concept of sustainability agreed upon in 1992 in Rio is very significant for development policies, which have been devised in the form of a "global domestic policy" as a contribution for the implementation of global structural policies. Its implementation by way of practical policies based on concrete initiatives is now the imperative of the moment.
In this context the following issues are to be given priority:
- the interconnection between social and economic development and saving the environment as the basis for life
- the interconnection between the process of globalisation and the main concept of sustainable development- poverty reduction and an end to environmental degradation
- the promotion of responsible usage of natural resources and thus making a clear separation between economic growth and consumption of the environment
- the strengthening and further development of structures for sustainable global development
- the need for additional sources of funding for global welfare - apart from ODAs - which could include international tax resources, such as a tax on the weapons trade and on currency speculation
- the outcome of the Johannesburg summit must be a set of concrete and measurable goals which governments should abide by
- education, vocational training, development of clean technologies and technological transfer are the keys to global sustainability.
There are the following detailed approaches:
- The Global Deal: only if the justified interests of the countries of the South and the East developing in line with the concept of sustainable development are considered in a fair manner can quantum leaps be achieved in connection with the agenda for the environment. Access to land and water, broad access to the markets of the highly developed states, more transparency and democracy constitute core elements which are to form part of such a "global deal" in Johannesburg.
- The Socialist International wants to continue with Rio 1992: at that time the partnership between the North and the South was given a new quality dimension - based on the recognition of the common, but diversified responsibility of the community of states for the state of the world. - It is extremely important not to confine such a "deal" to governments only, but to involve the parties and parliaments, trade unions, industry and the entire civil society as direct partners.
- This "deal" will also have to include the issue of financing. The highly developed states will finally have to live up to their financial commitments made in Rio and put them into practice. All the OECD member states should clearly determine a first stage for achieving the objective of 0.7 per cent.
Agreements in Johannesburg should be based on the objectives contained in the Millennium Declaration of the United Nations - especially the aim to reduce the number of poor people in the world by half by the year 2015. This means that it will be necessary to agree upon concrete measures for their implementation, to combat the structural roots of mass poverty and not to neglect any single significant element. The international community should set to work by way of devising concrete measures in order to tackle this issue!
Structural poverty alleviation requires various different measures at the same time. The preparation of Rio+10 is closely linked to other tasks on the international agenda:
- The results of the WTO negotiations in Doha raised hopes that it could be possible to increase coherence between policies on trade, the environment and development and to consider the justified interests of developing countries by continuing to open the markets, for example for agricultural products or textile goods.
- The Financing for Development Conference in Monterrey will have a direct impact on the success of the Johannesburg Summit if there are specific follow-up mechanisms.
- For the World Nutrition Conference to be held in June in Rome, the Secretary-General of the United Nations, in his report for the preparation of Rio+10, has given utmost priority to the issue of world nutrition and agricultural production. The Socialist International will express its position on the conference in Rome and afterwards analyse in great detail with which concrete steps the Johannesburg summit can also contribute to more progress in this field.
- The International Fresh Water Conference in Bonn (December 2001) has shown very clearly that the international community urgently needs to concentrate its efforts on the problem of scarce fresh water resources. The Socialist International demands that these important conclusions and findings of this conference be put onto the agenda of the Johannesburg Summit, be confirmed as important political goals on the part of the heads of state and government and that specific measures be taken for their political implementation.
- The Socialist International emphasises the need to lay down good governance at the national as well as the international level as an underlying concept in Johannesburg, too. It requires precise agreements in order to be able to reach this objective. This holds true for environmental issues as such, as well as for the broader concept of governance for sustainable development. This entails that the existing international structures and institutions for governance be put to the test. Johannesburg should be used to also reach this stage. The Socialist International approves of the establishment of a "World Commission for Sustainability and Globalisation".
- It will also be necessary to devise an action programme for the promotion of renewable sources of energy and energy efficiency. This should be predominantly focused on developing countries, but not neglect the necessity for the developed countries to change their patterns of production and consumption. In this context, too, the Socialist International urges the international community to leave no stone unturned to create the necessary conditions before Johannesburg to be able to put the Kyoto Protocol into practice.
- The mobilisation and financing of global public goods (GPG) in general constitutes a tremendous challenge for the community of states that is growing ever closer together. It is therefore urgently required, for the promotion of development policies, to analyse all the proposals that have been submitted on how the maintenance and provision of GPGs can be financed in great detail. It would be possible to impose a tax on international currency transactions and to charge fees for air-traffic and the usage of the oceans.
LIST OF PARTICIPANTS
Chair of the Committee
Secretary General of the Socialist International
Popular Movement for the Liberation of Angola, MPLA
Ismael Gaspar Martins
Socialist Party, PS
Liberal Party of Colombia, PLC
Socialist Party, PS
Social Democratic Party of Germany, SPD
Panhellenic Socialist Movement, PASOK
Democrats of the Left, DS
Institutional Revolutionary Party, PRI
Socialist Union of Popular Forces, USFP
Norwegian Labour Party, DNA
African National Congress, ANC
Spanish Socialist Workers’ Party, PSOE
Swedish Social Democratic Party, SAP
Social Democrats of USA, SDUSA
Democratic Socialists of America, DSA
Parliamentary Group of the PES
International Union of Socialist Youth, IUSY
Friedrich Ebert Foundation, FES
Oscar de Rojas
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