WORLD TRADE WT/LDC/HL/11
22October 1997
ORGANIZATION(97-4635)
High-Level Meeting onIntegrated Initiatives for
Least-Developed Countries 'Trade Development
THE CONTEXT INWHICH THE MEETING ISTAKING PLACE
Review ofOther Multilateral Initiatives currently being Undertaken by
Intergovernmental Organizations infavour ofLeast-Developed Countries
Prepared bytheUNCTAD SecretariatWT/LDC/HL/11
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CONTENTS
Paragraphs
INTRODUCTION 1-6
I. THE GENERAL CONTEXT
A. Programme ofAction fortheLeast Developed Countries forthe1990s 7-12
B. Final ActoftheUruguay Round (1994) 13-15
C. High-level Intergovernmental Meeting ontheMid-term Global
Review ontheImplementation oftheProgramme ofAction for
theLDCs forthe1990s (September/October 1995) 16-18
D. TheMidrand Declaration andAPartnership forGrowth
andDevelopment (1996) 19-20
E. United Nations System-wide Special Initiative onAfrica (1996) 21-22
F. United Nations NewAgenda fortheDevelopment ofAfrica
inthe1990s (UN-NADAF) (1991) 23-25
G. Agenda 21(1992) 26-27
II. TRADE-RELATED INITIATIVES
A. Generalized System ofPreferences (GSP) 28-34
B. Agreement ontheGlobal System ofTrade Preferences among
Developing Countries (GSTP) 35
III. DEBT-RELATED INITIATIVES
A. Heavily Indebted PoorCountries (HIPCs) Initiative 36
B. Enhanced Structural Adjustment Facility (ESAF) 37
C. Other Debt Relief Mechanisms 38-40
IV. TECHNICAL ASSISTANCE PROGRAMMES
A. UNCTAD Integrated Country Programme forDeveloping
Supply Capacities forTradeable Goods andServices
inLeast Developed Countries 41-44
B. WTO Technical Assistance Activities forLDCs 45WT/LDC/HL/11
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C. ITCTechnical Cooperation withLDCs 46
D. UNDP Technical Cooperation withLDCs 47-50
E. Technical Assistance inWorld-Bank-Assisted Operations 51
F. International Monetary Fund (IMF) Trade-Related Technical
Assistance Activities 52-56
G. Integrated Technical Assistance Programme inSelected
Least Developed andOther African Countries 57
V. OTHER INITIATIVES
A. Global Knowledge 1997 58
B. Tokyo Declaration onAfrican Development
"Towards the21stCentury" 59WT/LDC/HL/11
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Least Developed Countries
1. Afghanistan
2. Angola
3. Bangladesh
4. Benin
5. Bhutan
6. Burkina Faso
7. Burundi
8. Cambodia
9. Cape Verde
10. Central African Republic
11. Chad
12. Comoros
13. Djibouti
14. Equatorial Guinea
15. Eritrea
16. Ethiopia
17. Gambia
18. Guinea
19. Guinea-Bissau
20. Haiti
21. Kiribati
22. LaoPeople 'sDem. Rep.
23. Lesotho
24. Liberia25. Madagascar
26. Malawi
27. Maldives
28. Mali
29. Mauritania
30. Mozambique
31. Myanmar
32. Nepal
33. Niger
34. Rwanda
35. Samoa
36. SaoTome andPrincipe
37. Sierra Leone
38. Solomon Islands
39. Somalia
40. Sudan
41. Togo
42. Tuvalu
43. Uganda
44. United Republic ofTanzania
45. Vanuatu
46. Yemen, Republic of
47. Zaire
48. ZambiaWT/LDC/HL/11
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INTRODUCTION
1. Theleastdevelopedcountries(LDCs)arethepoorestandeconomicallyweakestofthedeveloping
countries, withformidable structural problems. Among themajor structural constraints hindering the
development oftheirtrade aretheirlowexport capacity, theverylowlevel oftheirexport receipts
andtheir fluctuations, andtheresulting sharp limitation ontheir capacity toimport. They face
supply-side weaknesses which impede theirability tocompete effectively inworld markets. Asthe
LDCs moved intothe1990s, theirshare inbothworld exports andimports fellbyone-half andone-third
fromthealready meagre levels of0.6percentand1.0percentrespectively in1980. Moreover, the
ratiooftheirexports toGDP fellfrom over17percentto14percentduring thesame period. The
LDCs 'share ofworld GDP decreased from0.6percentin1980to0.4percentin1993. Their share
inworldwide investment isalsoverysmall, andin1995theLDCs asagroup received lessthan1per
centofFDI. Thistrend suggests thatLDCs asagroup havebecome further marginalized inworld
output, trade andinvestment.
2. Over thepastseveral years, many LDCs haveundertaken wide-ranging reform policies and
measures toimprove theireconomic situation. Astheymoved along thereform path, thereform
objectives became more complex andambitious, shifting from thelimited concerns ofcorrecting
macroeconomic imbalances andstabilization topromoting development byaplethora ofmarket-oriented
reforms, including improving economic efficiency, curbing public-sector intervention, encouraging
theprivatesectorandliberalizingtheexternaltradesector.However,despitesomepositivedevelopments
inafewLDCs, thereform process hasnotyetlifted thestructural constraints inmany LDCs '
economies, norimproved theirsupply capacity.
3. ForLDCs tobreak away from theirmarginalization andtoparticipate more actively inthe
global economic processes, itisimperative thattheyshould besupported inwidening anddeepening
theexternal orientation oftheireconomies. Without support, LDCs willprobably become further
marginalized astheprocess ofglobalization gains further momentum.
4. Since theestablishment ofthecategory ofLDCs bytheUNGeneral Assembly in1971, there
havebeenseveral important initiatives infavour ofthese countries. These initiatives haveattempted
toaddress theconstraints facing LDCs inintegrating intotheworld economy andtheinternational
trading system.
5. IntheSingapore Ministerial Declaration, adopted atthefirstWTO Ministerial Conference
inSingapore inDecember 1996, WTO Members committed themselves toaddressing theproblem of
marginalization oftheLDCs andagreed totakepositive measures, suchasduty-free access, onan
autonomous basis, aimed atimproving theiroverall capacity torespond totheopportunities offered
bythetrading system. AComprehensive andIntegrated WTO PlanofAction fortheLeast Developed
Countries wasalsoadopted, which includes measures relating totheimplementation oftheDecision
onMeasures inFavour oftheLDCs, aswellasmeasures intheareas ofcapacity-building andmarket
access.
6. AttheWTO Conference, WTO Members agreed toseektogiveoperational content tothe
PlanofAction, forexample byenhancing conditions forinvestment andproviding predictable and
favourable market access conditions forLDCs 'products tofoster theexpansion anddiversification
oftheirexports tothemarkets ofalldeveloped countries and,inthecaseofrelevant developing
countries, inthecontext oftheGlobal System ofTrade Preferences among Developing Countries.
ThePlanofAction alsoenvisages closer cooperation between WTO andother multilateral agencies
assisting LDCs. Itwasonthisbasis thattheMinisters, inSingapore, called onWTO toorganize a
meeting withUNCTAD andtheITCassoonaspossible in1997, withtheparticipation ofaidagencies,WT/LDC/HL/11
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multilateral financial institutions andleastdeveloped countries, tofoster anintegrated approach to
assisting thesecountries inenhancing theirtrading opportunities. TheHigh-level Meeting onIntegrated
Initiatives forLDCs 'Trade Development should beseenasapartofthebroader spectrum ofsupport
initiatives forLDCs.
I. THE GENERAL CONTEXT
A. Programme ofAction fortheLDCs forthe1990s
7. Themainpolicy framework forconcerted international action toassist LDCs istheProgramme
ofAction fortheLDCs forthe1990s, adopted bytheSecond UNConference onLDCs in1990.
Inadopting theProgramme ofAction, theinternational community committed itself tourgent and
effective action, based ontheprinciple ofshared responsibility andstrengthened partnership, toarrest
andreverse thedeterioration inthesocio-economic situation intheLDCs andtorevitalize theirgrowth
anddevelopment. TheProgramme setsoutdetailed policy provisions formobilizing anddeveloping
human capacities inLDCs, including theroleoftheprivate sector, aswellasforthedevelopment
oftheireconomic base. Theinternational community, particularly thedeveloped countries, collectively
committed itselftoasignificant andsubstantial increase inexternal financial support. TheProgramme
provides forasetofalternative targets, which mapoutclearly thedifferent undertakings made bydonors
inthisregard (including theallocation of0.20percentofdonors 'GNP asODA toLDCs).
8. TheProgramme stresses thatamore open, credible anddurable multilateral trading system
caneffectively promote growth anddevelopment, particularly through improvements inmarket access.
Itcallsforurgent steps toprovide improved market access forproducts originating from LDCs. In
thisregard, itstates thatthere isscope forfurther improvement oftheGSPschemes andimproved
utilization ofthebenefits conferred.
9. Onthequestion ofmarket access, theProgramme callsforgiving special attention toLDCs '
needs andtothefollowing:
(a) Advanced implementation ofMFN concessions ofparticular interests toLDCs;
(b) Enhanced access forproducts ofLDCs through (i)theelimination, where possible,
orsubstantial reduction oftariffs; and(ii)theelimination, where possible, orgreatest
possible reduction ofnon-tariff barriers;
(c) Phased implementation byLDCs ofTRIPs andTRIMs;
(d) Possible modalities forspecial treatment fortropical products ofspecial interest to
LDCs; and
(e) Thefullest possible liberalization oftrade intextile andclothing forLDCs.
10. TheProgramme notes thatthere exists scope fortheimprovement ofGSPschemes. Areas
ofinterest toLDCs include: increasing therange ofproducts covered orthetariffconcession; applying
flexible rules oforigin; special terms orexemptions from quotas orceilings; andgreater long-term
stability andpredictability inthemanagement ofGSPschemes.
11. TheProgramme states thatGSP schemes areoften quite complex andadministratively
cumbersome. Developed countries were strongly urged totakesteps tosimplify procedures whereWT/LDC/HL/11
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appropriate. They could alsohelpLDCs takefuller advantage oftheGSPschemes, asinmany cases
theLDCs finditdifficult toexploit GSPopportunities fullyowing totheirweak andnarrow-based
economies. TheProgramme underscored theneedforparallel progress ininstitution-building, the
development oftheexport sector, anddevelopment partner assistance tohelpexport promotion and
diversification.
12. TheProgramme callsforconsidering preferential measures infavour ofLDCs inthecontext
ofbilateral arrangements withtheirneighbours, aswellasinregional andsubregional groupings of
developing countries, andfortheinterests ofLDCs tobetaken intoaccount during implementation
ofother regional integration schemes bydeveloped countries.
B. Final ActoftheUruguay Round (1994)
13. TheUruguayRoundofmultilateraltradenegotiationswassuccessfullyconcludedwiththesigning
oftheFinal ActinApril 1994.
14. Thekeyfeatures oftheoutcome oftheRound include, first, theestablishment oftheWorld
Trade Organization (WTO) toprovide acommon institutional framework fortheconduct oftrade
relations among itsmembers inrespect ofalltheagreements andarrangements concluded under its
auspices, including theentire results oftheUruguay Round. Secondly, tariffs onmanufactures have
beenreduced onaverage byoverone-third. Thirdly, withthegradual phasing-out oftheMulti-Fibre
Arrangement (MFA) andvoluntary export restraints (VERs), non-tariff measures (NTMs) havebeen
rolled backtoaconsiderable extent. Fourthly, anintegrated dispute-settlement mechanism hasbeen
established, underpinned bymore transparent andstronger rules, toapply toallmultilateral trade
agreements annexed totheAgreement establishing theWTO. Fifthly, theprinciple ofdifferential and
more favourable treatment hasbeenbuiltintothevarious agreements inrecognition ofthespecial
developmental, financial andtradeneeds ofdeveloping countries andtheleastdeveloped among them.
15. Special anddifferential treatment forLDCs hasbeenincorporated intothevarious provisions
ofthemultilateral tradeagreements andintheDecision onMeasures inFavour oftheLeast Developed
Countries annexed totheFinalAct.IntheDecision, Ministers decided that:"...ifnotalready provided
forintheinstrument negotiated inthecourse oftheUruguay Round, notwithstanding theiracceptance
ofthese instruments, theleastdeveloped countries, andforsolongastheyremain inthatcategory,
while complying withthegeneral rules setoutintheaforesaid instruments, willonlyberequired to
undertake commitments andconcessions totheextent consistent withtheirindividual development,
financial andtradeneeds ortheiradministrative andinstitutional capabilities". Ministers further agreed
that:"The rules setoutinthevarious agreements andinstruments andthetransitional provisions in
theUruguay Round should beapplied inaflexible andsupportive manner fortheleastdeveloped
countries...". They agreed to"keep under review thespecific needs ofleastdeveloped countries and
tocontinue toseektheadoption ofpositive measures which facilitate theexpansion oftrading
opportunities infavour ofthese countries."
C. High-level Intergovernmental Meeting ontheMid-term Global Review ontheImplementation
oftheProgramme ofAction fortheLDCs forthe1990s (September/October 1995)
16. TheHigh-level Meeting called fortheeffective application ofalltheprovisions oftheFinal
ActoftheUruguay Round andforconcrete action, asappropriate, consistent withtheFinal Act,to
fullyandexpeditiously implement theMarrakesh Declaration asitrelates toLDCs, aswellasthe
Ministerial Decision onMeasures inFavour oftheLDCs, andtogiveeffect totheMinisterial Decision
onMeasuresConcerningthePossibleNegativeEffectsoftheReformProgrammeonLDCsandNet-Food
Importing Developing Countries, withaviewtoenhancing LDCparticipation inthemultilateral tradingWT/LDC/HL/11
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system, taking intoaccount theimpact oftradeliberalization andtherelatively weakcapacities ofLDCs
toparticipate inanincreasingly competitive global market ingoods andservices.
17. Initsrecommendations, theHigh-level Meeting stated thefollowing (TD/B/LDC/GR/8, para
one,paras. 42-46):
(i) "Consideration shallbegiven tofurther improving GSPschemes andother schemes
forproducts ofparticular export interest toLDCs, e.g.agricultural products, fishand
fishproducts, leather andfootwear, andtextiles andclothing, through, where possible,
thewidening ofproduct coverage, thereduction ofprocedural complexities, andthe
avoidance offrequent changes intheschemes. Consideration should alsobegiven
toasignificant reduction intariff escalation.
(ii) Therules setoutinthevarious agreements andinstruments andthetransitional
provisions oftheUruguay Round, including those relating toanti-dumping,
countervailing duties, safeguards andrules oforigin, should beapplied inaflexible
andsupportive manner fortheleastdeveloped countries.
(iii) Asfortextiles andclothing, consideration should begiven, totheextent possible, to
permitting meaningful increases inthepossibilities ofaccess forexports fromLDCs.
(iv) Intheareaofservices, efforts should bedirected atbuilding andstrengthening the
efficiency andcompetitiveness oftheweak domestic service sectors oftheLDCs.
Their participation intrade inservices could beenhanced byeffective application of
Article IVofGATS, withspecial priority given toLDCs. Furthermore, ways should
beexplored tofacilitate LDC access toinformation technology andnetworks and
distribution channels, andtogiveeasyaccess toinformation toLDC service suppliers
through contact points tobeestablished, inaccordance withGATS. Itwasnoted that
themovement oflabour fortheprovision ofservices toother countries isanareaof
interest toLDCs.
(v) Careshould betaken sothatdomestic lawsandregulations ofimporting countries in
areas suchaslabour andtheenvironment donotconstrain theexport opportunities
ofLDCs inamanner inconsistent withtheFinal ActoftheUruguay Round."
18. TheMeeting alsocalled forrefocusing, andwhere necessary, intensifying technical assistance
tohelpLDCs takeadvantage ofthenewtrading environment created bytheconclusion oftheUruguay
Round. TheMeeting acknowledged thatcommon efforts bydonors, international organizations and
theLDCsthemselveswereneededtoimplementthecommitmentsmadeandtomaximizetheopportunities
arising from theUruguay Round Agreements.
D. TheMidrand Declaration andAPartnership forGrowth andDevelopment: finaloutcome of
UNCTAD IX(1996)
19. Theninth session ofUNCTAD, heldinSouth Africa inApril 1996, recommended thatakey
function ofUNCTAD should betoassist theLDCs tointegrate intotheworld economy andtheworld
trading system andtherefore derive greater benefits fromglobalization andliberalization. TheMidrand
Declaration (TD/378) states thatitshould berecognized thatcountries enterthenewrules-based trading
system from verydifferent starting points, andthat,accordingly, theimpact ofglobalization and
liberalization isuneven. Theleastdeveloped countries, particularly those inAfrica, remain constrained
byweak supply capabilities andareunable tobenefit fromtrade. Italsostresses thatspecial attentionWT/LDC/HL/11
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should bepaidtocreating anoverall enabling environment atthepolicy andinstitutional levelforthe
LDCs.
20. "APartnership forGrowth andDevelopment" (TD/378) recognizes thatinLDCs, commodity
andmarket diversification require investment, human resource development, technological capacities,
skills andsupport infrastructure toaugment levels ofproduction andefficiency tomeettheexacting
quality, costsanddelivery requirements ofglobal markets. International assistance, enhanced market
access opportunities, development finance, investment andtechnical cooperation canplayacrucial
roleincomplementing domestic efforts tocreate necessary conditions foreconomic growth and
sustainable development. TheConference recognized thevalue oftheGSPasaninstrument forthe
expansion oftrade. Itinvited thepreference-giving countries tocontinue toimprove andrenew their
GSPschemes inkeeping withthepost-Uruguay Round trading system andwiththeobjective of
integrating developing countries, especially LDCs, intotheinternational trading system. Itcalled for
finding ways andmeans toensure more effective utilization ofGSPschemes byLDCs andfortaking
actions, asappropriate, tomaximize theopportunities andtominimize thedifficulties ofdeveloping
countries, especially theLDCs, inadjusting tothechanges introduced bytheUruguay Round.
Governments were urged toimplement fullyandexpeditiously theMarrakesh Ministerial Decision
onMeasuresinFavouroftheLDCs.TheConferencecalledforaneffectiveapplicationoftheMarrakesh
Ministerial Decision onMeasures Concerning thePossible Negative Effects oftheReform Programme
onLeast Developed andNet-Food Importing Developing Countries.
E. United Nations System-wide Special Initiative onAfrica (1996)
21. TheUnited Nations System-wide Special Initiative onAfrica, initiated inMarch 1996, aims
atexpanding basic education andhealth care,promoting peace andbetter governance, andimproving
water andfoodsecurity. TheInitiative contains newmeasures toimprove donor coordination and
increase aideffectiveness. Itcomprises 14specific components foraction, based onfourthemes derived
fromdevelopment priorities defined bytheAfrican countries themselves, namely: "Give development
achance"; "New hopefortheupcoming generation"; "Strengthening thecapacity forgovernance";
and"Urgency onsurvival issues". Each component hasitsownframework forimplementation and
designates arelevant UNagency oragencies which willbeheldaccountable forprogress inachieving
thegoals. National Governments willberesponsible forimplementation inthefield, andmostofthe
resources willbeallocated tonational programmes ofaction locally defined andmanaged.
22. Thefirstthematic areaoftheSpecial Initiative, "Give development achance", contains
trade-related aspects. Three priorities arespecified inasection on"external support forAfrica 's
economic transition": substantial debtrelief, tradeaccess andopportunities, andpartnership withAfrica
throughSouth-Southcooperation.Asthenewinternationaltradingsystembringsbothnewopportunities
andnewobligations, theSpecial Initiative proposes three areas inwhich relevant agencies and
organizations, particularly ECA, FAO, ITC, UNCTAD, theWorld Bank andWTO, canstrengthen
Africa 'scapacity totakebetter advantage ofthenewinternational trading environment. These are:
(i) Encouraging WTO toadvise African States andtheAfrican business community on
howAfrican exports canbeincreased under thenewregime andtoinitiate stepswhich
canbeundertakentoenhancetheprospectsforAfrica'sexports.ItcallsuponUNCTAD
andWTO, withother relevant organizations, toproduce aplanofaction tofocus their
collective efforts, including ways toincrease Africa 'sexport-oriented production and
theimprovement ofexport diversification andmarkets;
(ii) Efforts toreduce oreliminate tariffs andtrade practices harmful toAfrica 'strade
prospects. Preference-giving countries should extend theproduct coverage ofGSPWT/LDC/HL/11
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benefits toAfrican countries, inparticular totheLDCs, andprovide access, freeof
duties, ceilings andquotas tothelatter. Stringent original requirements should be
relaxed;
(iii) Technical assistance tobeprovided toAfrica byWTO andother relevant agencies and
organizations oftheUNsystem inanumber ofareas.
F. United Nations NewAgenda fortheDevelopment ofAfrica inthe1990s (UN- NADAF) (1991)
23. TheUN-NADAFwasadoptedbytheforty-sixthsessionoftheUnitedNationsGeneralAssembly
toserve asacatalyst giving political impulse andstrength totheother activities going onwithin and
outsideAfrica.TheNewAgendahasasitspriorityobjectivestheacceleratedtransformation,integration,
diversification andgrowth oftheAfrican economies inorder tostrengthen them within theworld
economy, reduce theirvulnerability toexternal shocks andincrease theirdynamism, internalize the
process ofdevelopment andenhance self-reliance.
24. TheUN-NADAF alsoaccords special attention tohuman development, increased productive
employment andrapid progress towards theachievement ofhuman-oriented goals bytheyear2000
intheareas oflifeexpectancy, integration ofwomen indevelopment, child andmaternal mortality,
nutrition, health, water andsanitation, basic education andshelter.
25. Inorder toachieve these broad objectives, theUN-NADAF states thatitisnecessary forthe
international community toenter intoanewandstronger accord withAfrica, which would spellout
clearly thefirmcommitment oftheinternational community tosupport andassist Africa initsefforts
toimplement successfully itsdevelopment agenda andtoreduce, ifnotentirely eliminate, external
impediments andobstacles toAfrica 'saccelerated socio-economic transformation.
G. Agenda 21(1992)
26. TheUnitedNationsConferenceonEnvironmentandDevelopment(UNCED)(1992),inadopting
Agenda 21,made special references toLDCs. Principle 6oftheRioDeclaration states thatthespecial
situation andneeds oftheleastdeveloped countries shallbegiven priority. Several other chapters,
specifically chapter 2dealing withtradeandenvironment, chapter 33onresources andfinancing, and
chapter 37oninternational cooperation forsustainable cooperation, make special mention oftheneed
togiveparticular attention toLDCs.
27. AspartofthepreparatoryprocessfortheJune1997specialsessionoftheUnitedNationsGeneral
Assembly onthereview ofAgenda 21,ajointUNCTAD andDepartment ofPolicy Coordination and
Sustainable Development (DPCSD) AdHocExpert Group Meeting ontheImplementation ofSpecial
Measures forLDCs inAgenda 21wasconvened inApril 1997. Inviewoftheslowprogress inthe
implementation ofspecial measures inAgenda 21forLDCs, theMeeting made aseries of
recommendations totheCommission onSustainable Development forconsideration bytheCommission
initspreparatory work forthespecial session. These recommendations areintheareas of:(i)national
policies forsustainable development inLDCs; (ii)external financial assistance insupport ofsustainable
development; (iii)trade andenvironment; (iv)transfer ofenvironmentally sound technologies; and
(iv)capacity-building andhuman resources development.WT/LDC/HL/11
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II. TRADE-RELATED INITIATIVES
A. Generalized System ofPreferences (GSP)
28. TheGSP,firstimplementedin1971,providesforthegrantingofpreferentialtariffsbydeveloped
countries, onanon-reciprocal basis, onimports ofselected products from developing countries.
UNCTAD conference resolution 21(II)established thefollowing objectives fortheGSP: (a)toincrease
developing countries export earnings; (b)topromote theirindustrialization; and(c)toaccelerate their
ratesofeconomic growth. Atpresent, theGSPisoneofthemostimportant andcomprehensive systems
toaccord LDCs preferential access tomarkets. In1993, nearly three-quarters oftheexports ofLDCs
wereabsorbedbythemarketsofdevelopedcountriesthatgrantedGSPtreatment.Whilepreference-giving
countries draw uptheirownlistofbeneficiaries, allLDCs havebeenincluded inmost suchlists
since 1994.
29. Theusefulness ofGSPschemes forLDCs depends on:whether more favourable treatment
isaccorded toLDCs thantoother beneficiaries; theextent towhich theschemes arebeing usedby
LDC exporters; andimprovements intheschemes, particularly forLDCs, bearing inmind theerosion
ofGSPpreferences asaresult oftheimplementation oftheUruguay Round Agreements.
30. There isageneral consensus ontheneedtoimprove theGSPforthebenefit ofLDCs. Almost
allpreference-giving countries haveimplemented special measures infavour ofLDCs, andfurther
improvements areunder consideration inthecaseofsomeschemes. Reform efforts have, infact,gained
newmomentum inthewake oftheUruguay Round. Broad scope remains forstrengthening special
GSPmeasures forLDCs andenabling thesecountries toincrease theutilization ofthevarious national
schemes.
31. InMay1997, theUnited States introduced substantial changes intoitsGSPscheme infavour
ofLDCs. Itnowgrants duty-free access tomore than1,700 newproducts, especially infavour of
designated LDCs. Thismeasure expands substantially duty-free access totheUSmarket forawide
range ofagricultural products, petroleum andpetroleum products andinindustrial sectors notconsidered
sensitive. Italsocovers almost allfoodandprocessed foodandfishery products, provided thatimports
findaplace within thetariff quotas. According totheindications provided bytheUnited States
Government, thenewLDC concessions cover additional imports from African LDCs ofabout
US$2.5 billion. Thisnewfacility islikely tocreate substantial newtrading opportunities forLDCs.
32. Norway hassubstantially enlarged itsscheme 'scoverage andtreatment ofagricultural products
infavour ofLDCs. Access isduty-free andquota-free forallagricultural products except flour, grains
andfeeding stuffs, forwhich a30percentpreference isgranted within indicative tariff ceilings.
33. Other preference-giving countries, inparticular Canada andSwitzerland, havealsosubstantially
revised theirGSPschemes andexpanded GSPbenefits tocover alargenumber ofnewproducts. Canada
extends duty-free treatment toallGSP-eligible imports fromLDCs, withtwoexceptions: fortariffied
agricultural products, theGSPrateisgenerally two-thirds oftheMFN rate;fortextiles, clothing and
shoes GSPratesarehalftheMFN ratesandaceiling isapplicable. Rules oforigin ingeneral allow
animport content ofupto60percent(instead of40percentforother developing countries).
34. Japan'sGSPprovides forduty-free access formostindustrial products imported fromLDCs.
In1996/97, twenty-seven industrial products wereexcluded, suchassilkandsilktextiles, cotton yarns
andfabrics, tanned furskins, clothing accessories ofleather, andfootwear. Product ceilings arenot
applied toLDCs. Imports of73agricultural products likewise benefited fromduty-free entry. Another
27product groups were excepted, suchasmeat, chilled orfrozen fish,frozen shrimps, most freshWT/LDC/HL/11
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vegetables andnon-tropical fruit, riceandother cereals, fruitjuice, cigars andcigarettes, etc.Imports
ofricearesubject toanimport quota. Origin rules arecomparable intypetothose oftheEU.
Donor-country content isapplicable tomostproducts, which canmake itsubstantially easier forLDCs
tomeetthecriteria. Japan doesnotapply MFA-type quantitative restrictions toimports oftextiles
andclothing from LDCs.
B. Agreement ontheGlobal System ofTrade Preferences among Developing Countries (GSTP)
35. TheGSTPwasestablishedtopromoteandsustainmutualtradeandthedevelopmentofeconomic
cooperation among developing countries through exchange ofconcessions inaccordance withthe
Agreement establishing theGSTP. TheAgreement stipulates thatthespecial needs oftheLDCs shall
beclearly recognized andconcrete preferential measures infavour ofthese countries should beagreed
upon. TheLDCs willnotberequired tomake concessions onareciprocal basis. TheAgreement
includes, initsAnnex III,additional measures infavour ofLDCs. Itprovides that"special consideration
shallbegivenbyparticipantstorequestsfromparticipatingLDCsfortechnicalassistanceandcooperation
arrangements designed toassist participating LDCs inexpanding theirtrade withother developing
countries andintaking advantage ofthepotential benefits oftheGSTP". Several areas areidentified
forthispurpose. Thefollowing LDCs areparticipants intheGSTP: Bangladesh, Benin, Guinea,
Mozambique, Sudan andtheUnited Republic ofTanzania.
III. DEBT-RELATED INITIATIVES
A. Heavily Indebted PoorCountries (HIPCs) Initiative
36. TheHIPCs Initiative, jointly proposed andputinplace bytheIMFandtheWorld Bank,
represents acommitment bytheinternational community toreduce tosustainable levels theexternal
debtburden ofaneligible country thatsuccessfully completes aperiod ofstrong policy performance.
TheInitiative seeks toensure thatacountry 'sdebtburden doesnotinhibit itscapacity forsustained
growth. Twenty-nine LDCs areincluded inthegroup of41countries identified asHIPCs. TheHIPCs
Initiative builds onexisting mechanisms forproviding debtrelief, particularly theParis Club. Where
these mechanisms would notpermit theachievement ofdebtsustainability upon completion ofafirst
stage onstructural adjustment andpolicy reform, enhanced action under asecond stage isenvisaged.
Thiswould imply adeepening ofrelief intheParis Club (Paris Club creditors haveindicated their
willingness toprovide debtreduction ofupto80percentinpresent value terms onacase-by-case
basis), comparable treatment byother bilateral andcommercial creditors andenhanced support and
debtrelief. AnHIPCs Trust Fund hasbeenestablished bytheWorld Bank tofinance thescheme,
while theIMFwould participate through theEnhanced Structural Adjustment Facility (ESAF). As
firstbeneficiary, Uganda 'seligibility forassistance under theHIPCs Initiative wasapproved inApril
1997. Under theInitiative, Uganda isexpected toreceive about $340 million (innetpresent value
terms orinApril 1998dollars) fromitscreditors, representing anapproximately 20percentreduction
initsdebt. Other beneficiaries willbeconsidered onacase-by-case basis.
B. Enhanced Structural Adjustment Facility (ESAF)
37. Since thesecond halfofthe1980s, theIMFhassought torespond tothebalance-of- payments
difficulties confronting many oftheworld 'spoorest developing countries byproviding concessional
financing through theESAF anditspredecessor, theStructural Adjustment Facility (SAF). ESAF
arrangements provide financial support tocountries implementing comprehensive programmes of
macroeconomic stabilization andstructural reform. In1993, itwasdecided toenlarge andextend ESAF
toensure continued concessional support bytheIMFtothepoorest countries, andtheExecutive BoardWT/LDC/HL/11
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oftheIMFdecided toinitiate operations under theenlarged andextended ESAF Trust. Bytheend
ofMarch 1997, twenty LDCs hadESAF arrangements ineffect. InSeptember 1996, theIMF's
Executive Board reiterated itsunanimous support forthecontinuation ofESAF.
C. Other Debt Relief Mechanisms
38. Theintroduction, inDecember 1994, oftheNaples terms forofficial bilateral debtrelief in
theParis Clubincreased thepercentage ofpossible debtreduction (inpresent value terms) to67per
cent,ascompared with50percentunder theenhanced Toronto terms. TheNaples terms allow, for
thefirsttime, thereduction ofthestock ofdebtaswellasdebtservice, either through write-offs or
through rescheduling atreduced interest rates. Bymid-1997, nineteen LDCs hadobtained restructuring
oftheirdebtunder theNaples terms. Fourofthose agreements concerned stock-of-debt operations.
39. Initiatives havealsobeentaken toreduce thecommercial debt-servicing obligations ofLDCs,
including theDebtReduction Facility (DRF) established bytheWorld Bank in1989. Bytheendof
1996,debtbuy-backoperationshadbeencompletedforeightLDCs(Ethiopia,Mauritania,Mozambique,
Niger, SaoTome andPrincipe, Sierra Leone, Uganda andZambia).
40. Anumber ofother debtrelief mechanisms havebeenandcontinue tobeapplied tothebenefit
ofLDCs, including ODA debtforgiveness bydonor countries, inaccordance withUNCTAD Trade
andDevelopment Board resolution 165(S-IX), otherbilateral donor support fordebtrelief programmes,
IDAsupplemental allocations ("fifth dimension") andtheIMF
rights accumulation programme.
IV. TECHNICAL ASSISTANCE PROGRAMMES
A. UNCTAD Integrated Country Programme forDeveloping Supply Capacities forTradeable
Goods andServices inLeast Developed Countries
41. Acentral component ofUNCTAD 'sroleinassisting LDCs tointegrate intotheworld economy
istheprovision oftechnical assistance tostrengthen export supply capacities atthenational level.
Thekeyareas inwhich UNCTAD focuses itsactivities aretrade, investment, enterprise development,
facilitating theroleofwomen inbusiness andtrade, andtechnology. Technical assistance entails
programmes tostrengthen managerial andtechnical capacities intheprivate sector, toenhance theability
ofpublic administration toformulate andimplement appropriate policies, andtoprovide theservice
infrastructure tosupport trade andinvestment.
42. Inlinewiththedecision ofthe1996session oftheTrade andDevelopment Board, UNCTAD
haslaunched anIntegrated Country Programme (ICP) fordeveloping supply capacities fortradeable
goods andservices inleastdeveloped countries todirect itstechnical cooperation activities inLDCs
intheabove-mentioned areas. TheICPwillbring under itsaegies UNCTAD 'stechnical cooperation
projects inLDCs, coordinating individual technical cooperation activities atthecountry leveltoensure
thatthese activities focus onthespecific requirements ofthese countries andthattheycomplement
rather thanduplicate othertechnical cooperation activities undertaken byotheragencies. Implementation
oftheICPwilltherefore ensure thattheleveloftechnical assistance toLDCs issubstantially increased
andthattheeffectiveness oftechnical assistance inmeeting theneeds ofLDCs ismaximized. The
ICPwillprovide aframework atthecountry levelencompassing bothexisting technical cooperation
activities inLDCs intherelevant fields andnewinitiatives. Itwillalsofacilitate theprogramming
ofUNCTAD 'soverall technical cooperation programme.WT/LDC/HL/11
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43. Initswork relating toICPs, UNCTAD hassought toinvolve other concerned agencies injoint
programming missions. Inthisway, itwillbeabletofashion integrated multi-agency country
programmes forLDCs intrade andtrade-related areas which correspond totheoverall objectives of
theHigh-level Meeting.
44. TheICPhassofarbeeninitiated inBangladesh, Cambodia, Gambia andMadagascar.
B. WTO Technical Assistance Activities forLDCs
45. TheWTO has,incooperation withtheWorld Bankandother agencies, initiated anInformation
Technologies andDevelopment Project thatwilluseinformation technologies tobetter enable
decision-makers indeveloping countries tounderstand andmake useoftherulesandmechanisms of
theWTO forthebenefit oftheircountries. Theproject willenable developing country decision-makers
tohavepermanent on-line access toelectronic training andeducation toolsconceived specifically for
them, andtomaintain ongoing electronic contact withtheWTO sothattheycankeepabreast ofnew
developments andbeinformed oftheimportance ofagreements fortheirspecific country orregion.
During thelatterstages oftheUruguay Round, theleastdeveloped countries requested theestablishment
ofaSpecial Unitwithin theWTO secretariat todealwithmatters ofspecific interest tothem, other
thantechnical assistance. With thesuccessful conclusion oftheUruguay Round, requests forWTO
technicalassistancehaveincreasinglyfocusedontheimplementationoftheUruguayRoundAgreements.
C. ITCTechnical Cooperation withLDCs
46. ITC'sfirstpriority istohelptheLDCs improve theirtrade performance. ITC'sareas of
specialization areproduct andmarket development, development oftrade support services, trade
information, human resource development, international purchasing andsupply management, andneeds
assessment andprogramme design. Itstechnical cooperation programmes focus onbusiness sector
activitiesandaimatimprovingtheglobalcompetitivenessofsmallandmedium-sizedenterprises(SMEs).
Inthedecade upto1996, undertook 101country projects in33LDCs. Inaddition, LDCs wereincluded
in282interregional and113regional programmes. ITC'sexperience ledittoemphasize thefollowing
keyfactors forsuccess intrade-related technical cooperation: (i)afavourable macro policy and
regulatory environment fortrade; (ii)need-based, clearly focused andmanageable programmes;
(iii)programme ownership, commitment andpartnership onthepartofallstakeholders, public and
private; (iv)importance ofemphasis onnational capacity-building. ITCpresently hasninecountry
projects underway inLDCs. Anadditional 10LDCs areincluded under 18interregional and11regional
projects. ITCpresently hasninecountry proposals forLDCs awaiting funding, aswellasfourregional
andtwointerregional proposals withsignificant LDC components. These projects aimatnational
capacity-building inpartnership withlocal institutions, product andmarket diversification, andthe
improvement oftheglobal competitiveness ofSMEs.
D. UNDP Technical Cooperation withLDCs
47. TheUnited Nations Development Programme (UNDP) istheUN'slargest provider ofgrant
funding fortechnical cooperation andthemain body forcoordinating UNdevelopment assistance at
thecountry level. Funded byGovernments 'voluntary contributions, UNDP 'soverarching mission
istohelpcountries builduptheircapacities forsustainable human development, which centres onpeople
while promoting equitable economic growth. Priority policy objectives forprogrammes supported
byUNDP focus onpoverty eradication, sustainable livelihoods, environment andnatural resources
management, andtheadvancement andemployment ofwomen. Good governance andefficient public
sector management areessential forreaching these policy objectives.WT/LDC/HL/11
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48. Insupport ofthese goals, UNDP isoperating anetwork ofoffices in132countries toassume
theoverall responsibility for,andcoordination of,theUNsystem isoperational activities for
development. Tothisend,theResident Coordinator ensures theefficiency andconsistency ofthe
operational activities oftheUnited Nations system withtheplans, priorities andstrategies ofthecountry
concerned, aswellastheeffective, complementary andsynergistic contributions oftheUnited Nations
system.
49. InLDCs, UNDP 'sexperience insupporting international trade andFDIhastaken several
directions:
(i) Capacity-building fortrade anddevelopment. These projects focus mainly on
strengthening human resources, information networking, development ofprocedures
andsystemsandinstitutionaldevelopment;supportisprovidedtogovernmentinstitutions
butalsototheprivate andassociative sectors suchaschambers ofcommerce and
industry andexport processing zones;
(ii) Trade facilitation, suchasstreamlining ofcustoms offices toincrease efficiency and
speed andcutdown transaction costs, commercial fairs, exchange ofelectronic
information ontrade opportunities andtransfer oftechnologies, quality control and
standardisation;
(iii) Market access andregional groupings. Support isprovided forstrengthening policy-
analysis capabilities, negotiation andimplementation ofmeasures agreed upon, either
within aglobal framework, e.g.theUruguay Round andnowtheWTO, orwithin
regionalfree-tradezonesandothercooperativearrangementsbetweenStatesandregional
institutions; oneparticular caserelates toland-locked countries andtheiraccess to
harbours;
(iv) Trade development cannot belimited tothesolesector oftrade, andanefficient public
sector thatguarantees property rights andpolicies thatpromote anenabling environment
forthedevelopment oftheprivate sector arealsokeyelements ofsuccess. Inthis
regard, innearly allLDCs UNDP supports governance programmes which aimsat
installing transparency andaccountability ingovernment andensuring thecredibility
andconfidencenecessarytoconductbusinessactivities.Theseprogrammesmayinclude
components offiscal governance, macro-economic policies thatpromote export-led
development, trade liberalization andmeasures toencourage backward linkages with
localenterprises, andstrengthening ofthelegalandjudicial system.
50. UNDP hasembarked onpreparatory work fortheelaboration ofaregional programme for
sub-Saharan Africa directed towards capacity-building intheareas oftrade andinvestment. This
programme isbeing elaborated inclosecollaboration withvarious agencies, including UNCTAD, ITC,
ECA, OAU andtheregional groupings. Theprogramme willfocus primarily onfourbroad areas:
(i)strengthening human resources intheareaofregional andmultilateral rules affecting trade and
investment; (ii)strengthening thecapacity ofnational governments, intergovernmental organizations,
business andcivilsociety inAfrica toformulate trade andinvestment strategies thatcanpromote
export-leddevelopment;(iii)strengtheningtheenablinginstitutionsandsystemsthatenhancethecapacity
ofAfrican business totrade; and(iv)strengthening thecapacity ofAfrican firms touseenabling and
support services thatcanincrease theircapacity totrade. Itisexpected thatthisprogramme willbecome
operational inthesecond halfof1997. UNDP isalsoimplementing aprogramme which provides
support totheArabStates, including thefiveArabLDCs, intheirpursuit ofeconomic andsocial reform
andmultilateral economic cooperation.WT/LDC/HL/11
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E. Technical Assistance inWorld-Bank-Assisted Operations
51. Technical assistance hasbeenanimportant element oftheoperations implemented bytheBank
since itsearly days. Many investment projects include technical assistance components because the
borrowers recognize thattheydonothavethefullcomplement ofskills andrelated equipment to
implement theprojects within thestipulated timeframe andcostparameters. Themajor thrust of
freestandingtechnicalassistanceoperationsistocreateorenhanceborrowercapacitytoformulatepolicies
thatareconducive togrowth andequity; build orstrengthen institutions (ministries, agencies andlocal
governments) andenhance thequality anddelivery ofpublic services; improve economic, financial,
judicial andenvironmental management; assist inreducing government 'sinvolvement indirectly
productive activities, while alsoenhancing theperformance oftheremaining public enterprises through
performance contracts orexposure tocompetition; andcreate anenabling environment fortheprivate
sector toplayavastly expanded rolethrough appropriate incentives andminimal regulation. TheBank's
roleinassisting policy formulation, improving administrative systems andeconomic management,
enhancinggovernmentalefficiencyandresponsivenesstopublicneeds,andvastlyenhancingopportunities
fortheprivate sector hasgrown considerably inrecent years, andtherange ofactivities being supported
continues tobroaden. TheBankprovides technical assistance toLDCs through IBRD andIDAprojects,
Trust Fund projects andEconomic Development Institute activities.
F. International Monetary Fund (IMF) Trade-Related Technical Assistance Activities
52. TheFund provides technical assistance inthree main areas -monetary andexchange affairs,
fiscal issues, andstatistics -which contribute totrade liberalization andtrade promotion. Technical
assistance inforeign exchange system reforms focuses ontheliberalization ofexchange controls,
acceptance ofArticle VIIIoftheFund'sArticles ofAgreement, andthedevelopment ofmore
market-basedexchangearrangements.Muchofthisassistancehasadirectbearingontradeliberalization.
53. TheFund hasbeenheavily involved overthelastfewyears inassisting member countries to
improve theirbanking payments andsettlements systems inorder tomeetinternational standards of
bestpractice. Confidence inthepayment process, aswellasintheintermediation ofsavings and
investment, iscrucial fortheefficient flowofgoods, services, andinformation through markets. The
adoption ofinternational bestpractices hasenabled domestic financial institutions toengage in
cross-border activity insecurities andforeign exchange andtofacilitate thetradeandfinance activities
oftheir customers. Animproved payment system infrastructure hasalsoprovided adomestic
environment which encourages thedeepening ofdomestic financial systems through theentryofforeign
institutions.
54. Technical assistance inmonetary operations andmonetary policy implementation contributes
indirectly totrade liberalization. Inthefirstplace, itcontributes tomacroeconomic stabilization by
helpingcountriestodeveloptheirmonetarytechniques.Moreover,sincethetechniquesforimplementing
monetary policy thatareusually proposed inthecontext ofFund technical assistance aremarket-based,
theytendtoencourage thedevelopment ofthefinancial markets thatareanecessary complement of
thegoods andservices market. Inaddition, theyfacilitate theopening ofdomestic financial markets
tointernational competition.
55. Technical assistance inthefiscal areaaffects trade promotion activity directly andindirectly;
itcovers bothpolicy advice andsystems andmanagement issues. Main areas ofsuchassistance are
reform totaxandtariff policies, modernization ofcustoms, trade data,introduction ofVAT, income
taxreform, andtaxharmonization. Inasmuch asimproved government budgeting andpublic finance
management contributes tobuilding investor confidence andmacroeconomic stability, theFund's
considerable technical assistance inpublic expenditure management alsohelps tocreate favourableWT/LDC/HL/11
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conditions fortheconduct oftrade andinvestment. Theassistance isprovided intheform ofstaff
advisory missions, aswellasthrough follow-up byshort-term andlong-term experts. Inmany cases
assistance inthese areas ispartofacomprehensive programme sponsored along withother agencies
suchastheUNDP ortheWorld Bank.
56. Technical assistance inbalance ofpayments normally includes areview oftheefficacy ofthe
statistics covering tradeingoods andservices, together withpractical suggestions astohowthestatistics
maybeimproved within thecontext oftheeconomy receiving theassistance. However, thisadvice
isgenerally focused onimprovements thatareimportant tobalance-of-payments compilations. Thus,
formerchandise trade, theissues ofcoverage, timing, classification andvaluation arealladdressed,
whileissuesrelatingtocommodityclassifications,countrydestinationororiginandthedetailsofcustoms
administration aretypically notaddressed. Withrespect totradeinservices, thebalance-of-payments
accounts areusually theonlysource ofdatainmostcountries. Thus, technical assistance addresses
detailed issues relating tothesources andmethodologies formeasuring thistrade. Theassistance is
provided intheformofregular missions ofabout twoweeks each. Insome cases, resident statistical
advisors areposted incountries forlonger periods (three months toayear) toaddress more extensive
difficulties. Assistance isalsoprovided intheform oftraining.
G. Integrated Technical Assistance Programme inSelected Least Developed andOther African
Countries
57. On26April 1996, ontheeveofUNCTAD IX,theSecretary-General ofUNCTAD, the
Director-General ofWTO andtheExecutive Director ofITClaunched inMidrand, South Africa, an
integratedtechnicalassistanceprogrammeforAfricancountries.Theoverallobjectiveoftheprogramme
istoenhance thedevelopment prospects andcompetitiveness ofAfrican countries through increased
participation ininternational trade. Itemphasizes human resource development andinstitutional
capacity-building, aswellasthestrengthening ofexport supply capabilities. Itisdesigned tomaximize
cooperation among thethreeco-sponsoring organizations andtoimprove theutilization andeffectiveness
ofavailable resources. Priority attention instage 1oftheintegrated programme isgiven tohuman
resource development andinstitutional strengthening byfocusing ontheimplementation oftheUruguay
Round Agreements. Stage 2oftheprogramme concentrates onpolicy andother supportive measures
required tostrengthen export supply capabilities ofAfrican countries soastoexploit thenewmarket
opportunities created bytheUruguay Round. Thisprogramme iscurrently being implemented ineight
African countries, including thefollowing fourLDCs: Benin, Burkina Faso, Uganda andUnited
Republic ofTanzania. JointUNCTAD/WTO/ITC missions havevisited theabove-mentioned countries.
Inlightoftheexperience gained inimplementing thisprogramme, itsfurther development andextension
toother African countries andLDCs isenvisaged intheshort andmedium term.
V. OTHER INITIATIVES
A. Global Knowledge 1997
58. "Global knowledge 97"isaninitiative toassist developing countries (including LDCs) inthe
fieldofinformation technology. The"Knowledge forDevelopment Conference", co-hosted bythe
World Bank andtheGovernment ofCanada, tookplace inToronto, Canada, on23-25 June1997.
Itaddressed twofundamental questions facing developing countries andtheinternational community
intheinformation age:howcandeveloping countries, andparticularly theworld 'spoor, access and
harness knowledge fordevelopment, soastopromote empowerment, enable life-long learning, and
reduce poverty; andhowmust theinternational community adapt tohelpaddress these challenges.WT/LDC/HL/11
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B. Tokyo Declaration onAfrican Development "Towards the21stCentury"
59. TheTokyo International Conference onAfrican Development (TICAD), hosted bythe
Government ofJapan inOctober 1993, adopted theTokyo Declaration onAfrican Development with
theaimofstrengthening anemerging newpartnership forsustainable development inAfrica based
onself-reliance ofAfrican countries andthesupport ofAfrica 'sdevelopment partners. Theparticipants
intheConference committed themselves toapplying acomprehensive approach covering aid,trade,
debtstrategy andinvestments. They promised tomake allefforts toremove trade barriers andother
tradepractices thatprevent theexpansion ofAfrican exports including exports tootherAfrican countries.
The Conference underscored theimportance ofprimary commodities formany African countries '
export earnings andtheneedfordiversification toreduce thevolatility ofthese earnings. Several
follow-up activities toTICAD, including regional workshops andforums, havebeenimplemented.
Thesecond TICAD, tobeorganized bytheGovernment ofJapan, theUNOffice oftheSpecial
Coordinator forAfrica andLeast Developed Countries (OSCAL) andtheGlobal Coalition forAfrica
(GCA), willbeconvened in1998.