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DOCUMENTS "COM"
COM(79)14
Vol.1979/0007

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COMMISSION
OFTHE
EUROPEAN COMMUNITIES
GeneralSecrétariatCOM(79)14final
Brussels,24January1979*
FOROFFICIAL USEONLY
PREPARATIONS FORUNCTADV:POLICYGUIDELINES
(Communication fromtheCommissiontotheConcil)
COM(79)14final.

I. PURPOSE OFTHIS COMMUNICATION
1.Thefifth United Nations Conference onTrade andDevelopment (UNCTAD ),to
heheld inManila from 3rdMayto1stJune ,1979 »will heanimportant stage
intheprogress oftheNorth-South dialogue ,andonethat should beprepared
inaconstructive spirit .TheUNCTAD Board will meet inGeneva from 19th to
24th March (tenth special session )inorder tofinalise thedraft Agenda for
thefifth Conference andtopursue ingreater depth thediscussions oncertain
particular questions .TheGroup of77will meet atministerial level inArusha ,
Tanzania ,from 6thto16th February inorder toprepare itspositions for
Geneva and Manila .
Between nowandtheManila meeting ,anumber ofnegotiations will also be
taking place under theaegis ofUNCTAD .These will beconcerned with :
–theCommon Fund (resumption 12th-l6th March );
–individual commodities ,notably natural rubber (resumption 27thMarch -
12th April ),butalso cocoa (opening ofnegotiations on29th January )
andolive oil (opening ofnegotiations on20th March );
-indebtedness (continuation ofthediscussions intheUNCTAD Board );
-thecode ofconduct onthetransfer oftechnology (resumption
26th February-9th March ).
Other negotiations anddiscussions will also betaking place indifferent
fora ,notably theMultilateral Trade Negotiations (MTN)andintheCommittee of
theWhole oftheUnited Nations General Assembly .
There will inaddition beother important discussions ,after Manila and
before thespecial session oftheGeneral Assembly programmed totake place in
I98O :the3rdGeneral Conference oftheUnited Nations Industrial Development
Organisation (UNIDO ),theUnited Nations Conference onScience andTechnology
(UNCST ),theConference inAgrarian Reform andRural Development .

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2.ThepurposeofthisCommunication isto:
–assessthepresentstateoftheNorth–Southdialogueandtheroleof
IMCTADVinthatdialogue;
–proposethepoliticalguidelinesthatshouldshapetheCommunity
attitude "beforeandduringthefifthConference.
II.THESTATEOFTHEDIALOGUE AMDTHECONCLUSIONS TOEEDRAM
1.TheresultssofarachievedintheNorth/Southdialoguefallconsiderably
belowthehopesofthedevelopingcountries(ldcs)andevenoftheinternational
community;anditcannotbeexcludedthatthedialoguewillshortlyenterinto
acriticalstage.
Themutualunderstanding thatmarkedtheadoptionofthegeneralobjectives
attheseventhspecialsessionofthe■•United .HationsGeneralAssemblyin
September1975-andwasstill,toacertainextent,afeatureofthediscussions
attheCIECinParisin1976/77-hasscarcelybeentranslatedintoconcrete
decisions.WhethertheyconcerntheCommonFund,thecommodityagreementsor
thecodeofconductonthetransferoftechnology,thespecificnegotiations
undertakensinceUNCTAD17inNairobi(May1976)havenotachievedany
convincingresults–saveoncertainaspectsofindebtedness –eventhoughthe
gapbetweenthepointsofviewhasnarrowed.Asaresult,thedeveloping
countriesaregraduallybecomingconvincedthatsatisfactory progressispossible
onlyinacontextofconfrontation andthatthegeneraldeclarations ofthe
industrialised countries,evenifsolemnlymade,areofnoconsequence.
2.Thissituationdoesnotonlyreflecttherealdifficultyinmovingon
fromgeneralobjectivestopracticalachievements butisabovealltheresult
ofotherfactors,suchasthewait-and-seeattitudewhichmanyindustrialised
countriesaretendingtoadoptfacedwiththescale,complexityand

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durationoftheeconomicandsocialcrisisjtheincreasingly heterogeneous
natureoftheThirdWorldJthedifferencesofintereststhataredeveloping
andthelackofflexibilitythatoftenresultsattheleveloftheGroupof77
inthenegotiations .Thefeelingoffrustrationengenderedbythisblockage
intheNorth/Southdialogue,notablyamongdevelopingcountries,isaggravated
bythefactthatthequestionsthatarecurrentlythesubjectofinternational
negotiations nowcorrespondonlypartiallytotherealityofNorth/South
problemsasposedtoday,becauseoftherapidevolutionoftheworldeconomy
andincreasingdiversification betweenldcs.
3.Inanyevent,thissituationthreatens,ifitcontinues,tobringabouta
growingdisenchantment and,inthelongrun,areturntoconfrontation between
developingandindustrialised countries.
Sincenoone,theEECleastofall,hasanyinterestinseeingthat'danger'
becomereality,itisnecessarytopinpointthemostappropriate momentand
themostsuitablewayofreversingthepresenttrend.
4.Thequestiontobeansweredinthiscontextiswhetherornotitis
preferablefortheindustrialised countriestoarriveinManilahavinghonoured,
asfaraspossible,themainundertakings enteredintoinNairobiandinParis–
whichthenegotiations conductedsincehavevainlybeentryingtotranslateinto
reality?TheCommissionisoftheopinionthatitwouldbeagraveerroron
thepartoftheindustrialised countriesiijbeforeMajaila,theyfailtopursue
thenegotiations currentlyinprogresstosuccessfulconclusions.These
negotiations shouldatleastbecarriedtoapointwhichguaranteestheirdefinitive
settlementatManila,thusallowingaclimateofconfidencetobere-established .
Thereasonsbehindthispositionareasfollows:

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a)DeliberatetemporisinguntilManila-whichtheCommunityhasnever
envisaged-wouldthrustintothecentreoftheUNCTADVnegotiations
thequestionsalreadydiscussedatUNCTADIVandattheCIEC.
b)takingsuchaction,theindustrialised countrieswouldrunthe
riskofbeingforced,inordertoconcludemattersinManila,and
underthecustomarypoliticalandpsychological pressureofmajor
North/Southconferences,tomakegreaterconcessionsthanwouldbe
necessaryiftheyweretodemonstratetheirwillingnesstoconclude
mattersinthespecialisedbodies,atanearlierstage.
c)Thefurtherdeterioration intheclimateofNorth/Southrelations
thatwouldresultfromthere–appearanceatManila–forbasic
discussion–ofquestionsofwhichtheprinciplewasthoughttohave
beenresolvedatNairobiorParisisnot,asissometimessuggested,
thebestwayofavoidingthepresentation atManilaofnewdemands
thatwouldbeunacceptable totheindustrialised countries.
5.Morefundamentally ,theCommissionfeelsthatitisnecessarytoseizethe
opportunityofferedbytheAgendaofUNCTADVtodirectthedialoguerather
moretowardsthemainissuesofthefuture,withtheirincreasedaccenton
worldeconomicinterdependence ,andthusfocusthedialoguemoreontheproblem
ofthefuturethanonthedifferences ofthepast.
Awaitandseeattitudeonthepartoftheindustrialised countries,and
particularly theCommunity,inthenegotiations precedingManilawoulddeprive
themoftheminimumamountofcredibilitythatisnecessaryforthemtoretake
theinitiativeandendeavourtodirecttheNorth/Southdialogueinthedirection
outlinedabove:itleadsbacktotheneedtotacklethemajortopicsonthe

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UNCTADAgenda(tradeandtransfersofresources)inthecontextofa
reflection ontheprospectsaheadandthuscontributetotheInternational
StrategyfortheThirdDevelopment Decade.
6.ItisinthatspiritthatthisCommunication proposesguidelinesfor
thenegotiations to"beconductedbeforeManilawithinUNCTADaswellas
generalguidelinesforUNCTADVitself.
III.THENEGOTIATIONS TOBECONDUCTED BEFOREMANILAWITHINUNCTAD
Ofthenegotiations takingplacebeforeManila,thoseontheCommonFund
areakeyelementandatestofthegoodfaithoftheindustrialised and
developingcountries;asfarasindividualcommoditiesareconcerned,rubber
isincreasingly importantand,followingtherlongdiscussionsattheCIECand
inUNCTAD,thequestionofdebtraisedbyUNCTADResolution94(lV)isalsoa
keyproblem.Ontheotherhand,thenegotiations ontheCodeofConducton
theTransferofTechnologyarelessadvanced.
Inthelightoftheaboveconsiderations ,theCommissionwillshortlybe
restatingorproposingthefollowingapproaches.
1.CommonFund
Althoughitdidnotresultinanagreement,theresumptionofthesecond
sessionofthenegotiatingconferencefrom14thto30thNovemberlastyear
broughtaboutanappreciablereductioninthegapseparatingthepositions.

-6-
Under the "terms oftheresolution adopted atthe33rd session oftheGeneral
Assembly |theresumption inMarch ,should lead toanagreement onthemain
points andthekeyfigures ,anagreement that must besufficiently precise
andclear forUNCTAD Vmerely tohave toconfirm it.
2.Individual commodities
Onthebasis oftheCommunity position nowadopted onnatural rubber ,the
Community will endeavour tomake agood account oftheagreement that has
emerged between itandtheproducer countries .
TheCommunity should define Community positions andthus ensure early
progress ontheother commodities covered bytheIntegrated Programme
(cocoa ,jute ,sisal )which arecurrently orwill shortly bethesubject of
negotiations .Asfarassugar isconcerned the Commission trusts that
current discussions with theInternational Sugar Council will enable the
Community toadhere tothis agreement onthebasis ofequivalent commitments .
3.Debt
Inthesame spirit ,theCommunity will doeverything possible atthe
tenth session oftheBoard tohelp finalise adefinitive agreement onthe
"features "atUNCTAD V.Member States should trytobeready toreport to
theConference onthesteps they have taken toimplement decisions on
retroactive terms adjustment .

-7-
4.International CodeofConductontheTransferofTechnology
Thefirstsessionoftheconferenceleftalargenumberofcomplex
technicalandlegalquestionstoberesolved.Despite'theobviousdesire
ofalltheparticipantstocontinuethenegotiations ,itisunlikely,when
thenegotiations areresumedinFebruary,thatsufficientprogresscanbe
madetobringthecodetoastagewherepoliticaldecisionswouldhaveto
betaken.UXCTADVwillthereforehavetolimititselftorecordingthe
progressmade,callingforanacceleration ofthecurrentworkandtomaking
thenecessaryrecommendations regardingthecontinuation ofthenegotiations
thatarestillnecessaryinthisfield.
IV.THEGENERALGUIDELINES FORUNCTADV
1.IfUNCTADVcanberelievedoftheneedtoconcernitselfwithcurrent
negotiations ,havingonlytoratifytheirpositiveoutcomes,itwillopenin
ahealthieratmosphere,anditcoulddevoteitsattentiontothemainguidelines
thatwillcharacterize futureinternational cooperation .
Tothequestionsofrawmaterialsandthetransferofofficialfinancial
resourceswMchhavedominatedthelasttwodecades,shouldtodaybeadded
thefightagainsttheconstraintsthatweighheavilyonworldeconomicgrowth
andonlivingconditionsoftheThirdWorld–inthefirstplace,energyand
food:thereisarealriskthatinternational economicco-operation will
bediscreditedifitdoesnotsucceedinovercomingsuchmajorproblemsas
thatofenergyandfamineintheworld.Similarly,shouldbeadded;the

-8-
evolution–withitsconsequences –oftheinternational divisionoflabour
asanincreasingnumberofdevelopingcountriesachieveinternational
competitiveness inawiderangeofmanufactured goodsand,lastly,the
needfortheinternational communitytoensure,inacoherentway,the
financingofeconomicgrowthwithinastableenvironment andthemaintenance-
inconditionsoffaircompetition-ofanopentradingsystem.
Thesetopics,whichtheCommissionhasalreadyproposedshouldbeatthe
centreoftheCommunityapproachtothepreparations fortheInternational
DevelopmentStrategy,willbetackledinManilaeithergenerallyunder
Item8ontheUNCTADVAgenda,whichcoversUNCTADVfscontributionto
theformulationofthatStrategy,orincertaincasesundertheAgendaitems
ontheproblemsofinternational trade(items911)andontheproblems
ofthetransferofresources(item12).
2.ItisthusclearthatUNCTADVcouldequallybeaconstructive stagein
theprocessofjointreflectionthatshouldpreparefortheadoption,bya
specialsessionoftheUnitedNationsGeneralAssemblyin1980,ofanew
Strategywhosenaturalhorizonisinfacttheendofthecentury.
Intryingtosteerthediscussionsinthisdirection,theindustrialised
countrieswouldhelptorestoretoUNCTADitsconceptualroleJSecretary-
GeneralCorearecentlyexpressedhimselfinfavourofsuchadevelopment(l).
(l)AddresstotheUnitedNationsGeneralAssemblyinDecember197°.

-9-
Thecomplexityanddiversityofthequestionsthustackledwouldjustify
thefifthConference'sfunctioningasmuchasaforumforreflectionasa
negotiating "body.Itisclearlynecessarytoanapproachofthiskindthat
thecurrentnegotiations shouldhavemadeenoughprogresstopreventany
deterioration ofthegeneralatmosphere.
Whilst,therefore,Item8ontheAgendawillgivetheindustrialised
countriesandtheCommunityinparticulartheopportunityofdefiningthe
long-termperspectiveinwhichitspositionsonthevariousAgendaitems
aretobeseen,theothermajortopicsofUNCTADVwillaboveallbe:
–theevolutionoftradingarrangements inthecontextofthe
industrialisation ofthedevelopingcountries(items9and11on
theAgenda);
–thesystemofinternational financialcooperation-embracingand
goingbeyondtheconventionalquestionsrelatingtotheproblemsof
thetransferofresources(item12ontheAgenda);
–economicco-operationbetweendevelopingcountries(item18onthe
Agenda).
Othertopicsthatwillinevitablytakeupalargepartofthediscussions
are:
-traderelationsbetweencountrieswithdifferenteconomicandsocial
systems(item17ontheAgenda);
-therelationalisation andrestructuring oftheUNCTADpermanent
machinery(item19ontheAgenda)(l).
(l)Asregardsinstitutionalmatters,theCommunityshouldmakesurethatUNCTADretainsitsdualroleofconceptionandnegotiationasdefinedbyResolution
1995(XIX)oftheUnitedNationsGeneralAssemblyandbyResolution90(lV)
ofthefourthConference;theCommunityshouldalsosuggestcertain
improvementsinthesystemofprogrammeandbudgetplanning,payingdueattentiontoGenoj^alAssemblyResolution32/197(onrestructuring•••)•

-10-
–shippingfromthepointofviewbothofCommunitytransportpolicies
(codeofconduct)andoftendancieswithinUUCLADtoenvisageanew
typeoforganisationinworldshipping(item34ontheAgenda).
3.TheCommunitycouldformulateitscontributiontothinkingonthe
centralthemesaroundthefollowingguidelines:
3.1Asregardstradeandexportsofmanufactures ,UNCTADwillhavetoexamine
theoverallresultsofthemultilateraltradenegotiations (KTN)and
tocontributetothefightagainstthethreatstothetradingsystemposedby
theresurgenceofprotectionist tendancies.TheConferencecouldexpress
itsconclusionsintheformofallorth/Southdeclarationwhichshould
reflectthemutualinterestofallcountriesinthemaintenance ,and
indeedtheconsolidation -inconditionsoffaircompetition-ofan
openworldtradingsystemsInthiscontexttheConferencecouldaskthe
moreadvanced-developing countriestore-examinecertainaspectsof
theirpolicies *whichsetthemapartfromprogressachievedinthe
directionofabetterinternational divisionoflabour.

-11-
AnystepstakenbyUtTCTADinthisfieldshouldhaveregardforthe
involvementofpeople,andinparticularthepoorest,intheprocess
andbenefitsofproduction andtrade.
Asregardsmonetaryandfinancialproblems(item12ontheAgenda),
thefirstrequirementistoresolvedefinitively anumberofdossiers
whichhavebeenholdingupinternational discussionsforalongtime.
Themostimportantsubject ,hereiswithoutdoubtthefuturetreatment
ofcasesofindebtedness (the"features").Referenceshouldalsobe
madeinthiscontexttothequestionofestablishing aninternational
exportcreditguaranteefacilityforthedevelopingcountries.

-12-
Asregardsthemoreconventional questions,suchasthevolumeof
officialdevelopmentaid(oda),aidterms,theuntyingofaif,access
tothecapitalmarkets,etc.,onwhichfurthercommitments seen?
impossibleatthepresenttime,itisimportantthattheindustrialised
countriesshouldnotallowthemselvestobedrawnintonewformulating
exercise :?whichcouldonlycreatefalsehopeswithintheGroupof77
andtherebyworsenstillfurthertheclimateofNorth/Southrelatione.
Theimportantpointhereistoexplaintheconstraints facingthe
industrialised countriesandtogivepracticalsignsthatthecommitments
notyetrealisedinpracticearebeingimplemented .
Onthisbasis,itwouldbenecessarylastlytocarryoutthegroundwork
forapracticale^simiiiation,inthecontextofthepreparations forthe
strategyfortheThirdDevelopment ZJecs.de,ofthevariouspossibleforms
ofwhichanincreaseinthetransferofresource.:mighttak';."u-.rhm-
examination,whichcouldnotneglectcertainaspectsofthefunctioning
oftheinternational monetarysystem,shouldincludeinparticularan
assessmentofthemutualcompatibility ofthevariousformsofincrease
andanevaluationoftheirpossibleimpactonthebottlenecksthatare
"blockingthedevelopmentofldcsandwhichare,consequently ,preventing
abetterutilisationofthepotentialforworldeconomicgrowth.
Finally,concerningmonetaryproblems,theCoiSiimnityanditsMu:.berStates
shouldtrytodomoretoshowthevalueoftheimprovocien'us rxalomite
operationoftheinternational .monetarysystemandchowthensc!veswilling
toconsideritsfurtherdevelopment.Itshould,nevertheless,bev1early
establishedthatdiscussionsneldonthissucjectshouxu .u.r.o j

as_uronthecompetenceinthisareaoftheUT.Furthermore,it
seecsclearthatt..eCcr-JKaiityshouldusethisoccasiontounderline
theimportantcontrioutionwhichthecreationoftheI^iropeanKonetary
System(SMS)willheinapositiontomaketogreaterworldstability.
2.2SconosicCo–operatior.AmongPevclopi;-;;Countries(ZCDC)
TheCommunityhasalwaysgivenitssupporttothestrengtheningof!
technicalandeconomicco-operation between1-Jcs.Itbelievesthat
UI7CTADVwillprovideanopportunityforgivinganimportantimpetusto
thismajoraspectofinternatiojial co-operation .
TheCommunitycould,therefore,indicatethatiti~preparedtoparticipat
inanincreasedeffortonthepartofallcountries(marketeconomy
countries,state–tradingcountries,developingcountriesandthe
international bodies)toreinforcethisco-operation .Providedthat
theprioritysectorshavebeenrecognised(theCommission »;illbepatting
forwardideasonthissubject),theCommunityshouldindicatethatitis
readytoincreaseitstechnicalandfinancialassistanceforthepromotion
ofregionaldevelopment.
V.TH2ÏISZDFORCCmJTITT C0H23I0ÎT
Becausecftheimportance,thecomplexityandthediversityofthe
questionstobetackled,UKCTADVwillneedtobeprepared,inadetailedand
carefullyprogrammedway,inthecontextofthepoliticalguidelinesdecided
bytheCouncil.Independentoftheelementsnecessarytotheconclusionof
currentnegotiations,theCommissionintendstosubmitguidelines

enablingtheCommunitytomaintainitsunityandtotakeappropriate
initiatives onthedifferentsubjectsunderconsideration .Moreover,as
andifnecessary,theCommissionwillcommentonthesituationwhichemer,
followingtheGroupof77*5ministerial meetinginArusha.
ThroughouttheConferencetheCommunitywillexpressitspointsof
viewinconformitywiththedispositions alreadyagreedforinternational
discussions.Theparticipation oftheCommunityassuchisassuredin
thoseareaswhichfallwithinitscompetenceandtheCommunitywillacti:
commononthosequestionswhichhaveaparticularinterestforit.Inthi
opinionoftheCommissiontheCommunitywillonlybeabletoplayarole
commensurate withitsstatureifitsucceedsinputtingforwardanddefer,
ingcommonpositionsonallofthepointsontheConferenceAgenda.