WORLD TRADE WT/LDC/HL/8
13October 1997
ORGANIZATION(97-4390)
Original: English High-Level Meeting onIntegrated Initiatives for
Least-Developed Countries 'Trade Development
THEMATIC ROUND TABLE: B
ENCOURAGING INVESTMENT INLEAST-DEVELOPED COUNTRIES
56thMeeting oftheDevelopment Committee -CommuniquéWT/LDC/HL/8
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COMMUNIQUE
1. The56th meeting oftheDevelopment Committee washeldinHong Kong, China on
12September1997underthechairmanshipofMrDrissJettou,MinisterofFinance,Commerce,Industry
andHandicrafts ofMorocco.1
2. HelpingCountriesCombatCorruptionandImproveGovernance:Ministersagreedthatcorruption
andweak government undermine macro-economic stability, private sector activity andsustainable
development objectives, andmayerode international support fordevelopment cooperation. They
emphasized thatcorruption isaglobal problem thatrequires complementary actions byallcountries.
While stressing thatmember governments havetheprimary responsibility forcombating corruption
andstrengthening governance, theywelcomed themore active involvement oftheBank andtheFund,
eachwithin theirrespective mandate, inresponding tomember governments requests tostrengthen
theirinstitutions andperformance inthese areas, including theintroduction ofgreater transparency
inthepublic sector. They welcomed therelevant strategies andguidelines recently issued bytheBank
andtheFund. TheCommittee stressed theimportance ofaconsistent andeven-handed approach, as
wellastheneedtotakegovernance issues andcorruption explicitly intoaccount inlending andother
decision-making when theysignificantly affect project ormacro-economic andcountry performance.
TheCommittee asked thattheBank andFund report totheCommittee inayear'stimeonthe
implementation oftheirrespective strategies andguidelines.
3. Ministers invited other Multilateral Development Banks (MDBs) todevelop similar strategies
andguidelines.TheMDBswereencouraged,asamatterofurgency,toestablishprocurementprocedures
andoversight mechanisms ofthehighest standard andasuniform aspossible, including anti-bribery
provisions. Ministers noted theultimate responsibility ofborrowers forensuring fairandeffective
procurement, andstressed theimportance ofMDBs increasing theirassistance tohelpbuild borrower
capacity andaccountability.
4. Ministerswelcomedtheeffortsunderwayinotherinternationalandregionalbodiestocoordinate
efforts tocombat corruption. Inparticular, theCommittee encouraged governments tocriminalize
international bribery, inaneffective andcoordinated way.
5. Multilateral Investment Guarantee Agency (MIGA): Ministers reiterated theirsupport for
MIGA 'scontinued growth inresponse totheexpanding demand foritsservices. They welcomed the
consensus onaddressing MIGA 'sresource constraints bymeans ofathree-part funding package
comprising anIBRD grant ofUS$150 million, paid-in capital ofUS$150 million, plusUS$700 million
ofcallable capital. Ministers urged theIBRD management andBoard ofExecutive Directors tomove
swiftly toimplement theUS$150 million grant. Ministers urged MIGA 'sBoard toreach agreement
onimplementation oftheremainder ofthepackage. They alsourged theMIGA Board toreach clear
understandings oncorepolicy issues assoonaspossible. These measures would relieve MIGA 'sshort
termfinancial constraints andprovide itwithasustainable capital structure forthemedium tolong
term. Ministers urged theMIGA Board andother relevant parties tocome toclosure onthecapital
increase bythetimeoftheCommittee 'snextmeeting inApril 1998.
1MrZhuRongji, VicePremier ofChina, MrJames DWolfensohn, President oftheWorld Bank, MrMichel
Camdessus, Managing Director oftheInternational Monetary Fund, andMrAntonio Casas Gonzâlez, Governor
oftheCentral Bank ofVenezuela andChairman oftheGroup ofTwenty-Four, addressed theplenary session.
Observers from anumber ofinternational andregional organizations alsoattended.WT/LDC/HL/8
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6. Private Involvement inInfrastructure: Ministers welcomed theWorld Bank Group Action
Program designed tostrengthen theGroup 'sability toincrease private participation ininfrastructure
inthecontext ofitsoverall objectives tosupport poverty reduction andsustainable development. While
ministers recognized thatgovernments continue toplayasignificant roleininfrastructure investment,
theyemphasized theimportant andincreasing opportunities formore active private sector involvement.
Ministers encouraged theBank Group tostrengthen itscatalytic rolethrough early andeffective
implementation oftheAction Program 'scomprehensive range ofassistance intheareas offinance,
advisory services, riskmitigation, andknowledge andinformation. TheCommittee stressed the
importance ofcoordination among theBankGroup based onagreed country frameworks andstrategies.
7. Implementation oftheDebtInitiative forHeavily Indebted PoorCountries: TheCommittee
welcomed thefurther progress thathadbeenmade inimplementing theInitiative tosupport governments
thatshowstrong commitment toreform. TheCommittee alsoencouraged eligible countries toundertake
thepolicy actions necessary toputthem onthepathtosecuring debtrelief. Decisions toprovide
assistance ofabout US$0.9 billion (inpresent value terms), which willgenerate debtservice reduction
ofabout US$1.5 billion, have been made forBolivia, Burkina Faso andUganda; decisions on
Côted'Ivoire, Guyana andMozambique areexpected inthenearfuture. Ministers stressed the
importance ofadequate interim financing byallcreditors. TheCommittee expressed appreciation for
thecontinuingclosecollaborationamongcreditorsinimplementingtheInitiative,includingunderstandings
among themontheapproach toburden-sharing. Ministers alsoappreciated thatbilateral contributions
ofabout US$100 million hadalready beenmade orpledged totheHIPC Trust Fund (administered
bytheWorld Bank), andurged other governments tocontribute aswell. They alsoencouraged
international financial institutions which havenotyetfinalised mechanisms forparticipation inthe
Initiative todosoassoonaspossible. Ministers noted thatadditional resources willbeneeded tohelp
finance theAfrican Development Bank'sfullparticipation intheInitiative. They alsonoted theneed
foradditional resources tofinance theFund'scontribution totheHIPC Initiative forcountries beyond
those noted above and,more generally, theneedtocomplete thefunding ofESAF.
8. Strategic Compact: TheCommittee welcomed theprogress made inbeginning tomeetthe
Compact 'sambitious objectives tostrengthen theBank'seffectiveness, asreflected inManagement 's
firstsemi-annual progress report totheExecutive Directors.
9. Bank/Fund Collaboration onStrengthening Financial Sectors: Ministers noted theimportance
formacro-economic stability andgrowth ofstrengthening thefinancial systems ofdeveloping countries,
asrecent events haveshown. They welcomed anincreased emphasis onthisareainBank andFund
operations. Ministers viewed enhanced cooperation between theBankandtheFundasanurgent priority
andwelcomed therecent agreement guiding increased collaboration tohelpmember countries strengthen
theirfinancial systems.
10. Note ofAppreciation: Ministers expressed theirdeepappreciation forthewarm hospitality
provided bytheChinese authorities andtheHong Kong Monetary Authority.
11. NextMeeting:TheCommittee'snextmeetingwillbeheldon17April1998inWashingtonDC.