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DOCUMENTS "COM"
COM(76)39
Vol.1976/0017

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COMMISSION OFTHEEUROPEAN COMMUNITIES
/ \
COM(76)39 final
'/ Brussels ,HthFebruary ,1976
PREPARATION FOR THE U.N. CONFERENCE ONTRADE AND DEVELOPMENT
/
\ .•
(Meeting oftheUNCTAD Trade andDevelopment Board
i s «
8th-19th March ,1976 )
(Communication from theCommission totheCouncil )
• /
C0M(7o )39final .

I.NATUREOPTRÅDSANDD3VEL0PKENT BOARDBETING
1.TheTradeandDevelopment Boardmeetsannuallytoconsiderreports
fromtheUNCI1ADsubsidiarycommittees,e.g.onCommodities ,Manufactures
Invisiblesandsoon:butasomewhatdifferentperspective hasbeen
proposedfortheforthcomingmeeting,givenitspreparatoryroleforthe
NairobiConference.TheUNCTADSecretariat wishesittohavea"pre–
negotiating "role,i.e.todefinethoseareaswheremajordifficulties
remainandtoindicatethoseinhereprogressappearsmorepossible;
indeedtheSecretaryoftheNairobiConferencehasdescribedit"asa
dressrehearsalfortheConference".
2.Insofarasdocumentation isconcerned,theUNCTADSecretariat have
promisedaseriesofnewsectoralpapersonInternational Financial
Co-operation ,Manufactures andSemi–Manufactures ,TransferofTechnology
theLeastDeveloped,EconomicCo–operationbetweenDevelopingCountries,
butitismostunlikelythatanyofthemwillbecirculatedbeforethe
beginningofFebruary.However,itisunlikelythattheywilladdmuch
tothedocumentation alreadyputforwardinUNCTAD'svarioussubsidiary
groups(andnotablyoncommodities).
3.TheTDBwillthereforeconsidertheitemsontheDraftConference
Agenda(TD/B/L429»Rev.l)onthebasisof:
(a)theideasalreadycirculatedbytheSecretariat (seeAnnex),
whicharetobebroughttogetherinthesectoralpapers:
»
(b)certaindraftresolutionsalreadyagreedinorsubmittedto
variousCommittees ;
(c)anyfurtherpapersordraftresolutionsthatflowfromthe
ManilaConference ;and
(d)anyfurtherGroupBorDdraftresolutionsthatmaybeput
forward.

4.TheworkoftheTDBwillbeorganisedonthe"basisofthreemain
WorkingGroups:i.e.ofaContactGroupofthePresidenttolookat
Commodities andFinancialissues;ofaSub-GrouptodealwithManufactures
andSemi–Manufactures andwiththeTransferofTechnology ;andofa
secondSub-Grouptodealwithotherissues,includingtheproblemsofthe
leastdevelopedandoftradebetweendevelopingcountries.Thesethree
WorkingGroupsmaywellestablishprocedureswhichwillcarryoverinto
theNairobiConferenceitself(whichistoworkunderthecontrolofa
Bureauof35,including10membersfromGroupB,onthebasisofone
CommitteeoftheWholeandofasofarunspecified ,butlimited,number
ofWorkingGroups).
II.THEPREPARATION OFCOMMUNITY POSITIONS
5.ItisevenmoreimportantattheTDBatthisstage,thaninthe
generalrunofUtTCTADCommitteesthattheCommunityshouldspeakwith
onevoice;thelinksbetweenUNCTADIVandtheDialogue(i.e.CIEC)
areandwillbeclose.AgainstthisbackgroundtheCommissiontakesthe
viewthattheCommunityshouldmakeashort,formalopeningstatementon
themajorissues;andadraftwillbecirculatedinthelightofMember
Statesviews,indiscussionofthispaper.AtthesametimetheCommunity
mustcontinuetoworkatUTTCTADwithanathroughtheGroupBsystemand
itwillhaveanimportantparttoplayindetermining GroupBviewson
severalissues,notablyoncommodities .Step3arethereforeinhandto
recalland/ortodefineCommunityviewsoneachmajorissueonthe
UNCTADdraftAgenda:mostwillhavebeenpreparedexplicitlyforuse
inUNCTADandintheDialogueandallwillhavebeenpreparedinclose
liaisonwiththecomplementary requirements oftheDialogue.
6.ThemajorlinesofexistingCommunitypositionsaresummarisedin
theAnnex,withanindicationofCommissionproposalsincertaincases,
andthefollowinglistdoesnomorethanindicate,onthebasisofthe
draftTDBandConferenceAgenda,wherethemajorissueslie.–

-4-
/ÂgenclaItems1-7:Procédural^/
AmendaItem8:Commodities
EversincetheTradeandDevelopment Boardbeganworkonthepreparation
oftheIntegratedProgramme,inAugust1974,inthelightofthecall
madetoitbytheU.K.6thSpecialSession,thequestionofcommodity
tradehasbeenintheforefrontofevolvingdevelopingcountrydemands
(e.g.intheeventsleadinguptoandideascontainedintheproposed
NewInternational EconomicOrder).TheUNCIALSecretary–Generalregards
progresshereasoneofthe,ifnotthe,majorobjectiveofthe
Conference.AttheTradeandDevelopment BoardtheCommunityshouldbe
inapositiontoparticipateinthediscussionofthefourpointsin
theResolutionadoptedattheDecembermeetingoftheCommodities
Committeeontheobjectivesofcommodityarrangements ,themeasuresto
beapplied,theproductstobecovered,andtheproceduresandtimetabletobe
adopted.AdocumentwassenttotheCouncilon28thJanuary,1976hythe
ServicesoftheCommission(seeSEC(76)28l)whichsetsoutcertainlinesof
thought/orientations/.Inthecontextofanalternative,overallapproach,
theCommission nowproposesthattheCommunityshouldbeinformedbycertain
elementsintheselinesofthought,whenattheTDBitaddressesitselfto
thesefourpointsintheResolutionandinparticulartothelistof
commodities .ThebroadlinesproposedaresetoutintheAnnex.
AgendaItem9*Manufactures andSemi–Manufactures
TheCommunity'spositionongeneralisedpreferencesisclear,andthe
CommunityMandateontheMultilateral TradeNegotiations (KIN)has
establisheditspositiononbothtariffandnon-tariffbarriers.
Additionalworkisnowbeingundertakenonthebroaderaspectsof
industrialpolicy,includingadjustmentassistanceoninvestment
guarantees,andinteraliaon
restrictivebusinesspractices,marketingandshipping.Thepresent
positionissetoutintheAnnex.

-5-
Agenda Items 10,11and .13:Tfa.jor International Developments ;Transfer
ofResources ;and Least Developed
TheCommunity sucoeeded insustaining common positions attherecent
meeting oftheCommittee onInvisibles ,andFinancing ,andTrade ,in
Geneva ,notably ontheproblem ofdebt .Community positions nowneed
tobedeveloped onarange ofissues ,including help forthepoorest
andleast developed ,triangular co-operation ,andtheinternational
monetary situation (seeAnnex ).
Agenda Item 12:Transfer ofTechnology
Onthis issue the Community 'sposition isparticularly well integrated
into Group B's:itremains tobeseen whether ornotUNCTAD IVcan
help tobring about arappr ochement between the draft Codes ofConduct
ofGroup Bonthe oneside and ofthe Group of77on "theother .The
major issues arewhether ornottheCode should be (i)universal and
(ii)mandatory .TheCommunity view issetoutintheAnnex .
Agenda Items 14–16
These relate toeconomic co-operation between developing countries ,and
between countries ofdifferent social systems ,andtoinstitutional
questions .There may besome useful iflimited steps totake on
developing country co-operation :andthere maybesome scope fortrying
toinsist onamore effective contribution from socialist countries .
Insofar asinstitutions areconcerned ,theCommission believe that the
Community should take itsstand attheTDBontheposition adopted at
theCommodities meeting inDecember (seeAnnex ).
/Âgenda .Items 17–195Procédural itéras^
*
* *
Inaddition tofour main papers onCommodities ,Manufactures ,Financial
issues ,andtheTransfer ofTechnology ,theCommission vail be
circulating apaper containing relevant trade andaidstatistics .

III .COT.XU^TIT /OBJECTIVES AND TACTICS ATTHE TRADE AND D3VEL0P?.!2NT BOARD
7.Given theevolution oftheinternational debate andgiven the
relatively narrow options open totheCommunity ,theCommunity 'soverall
objectives attheTDBshould be:
(a)tomaintain Community unity onmajor international development
issues within the framework sofaraspossible ofGroup B
positions ;
(b)toachieve conceptual progress inthedirection ofan
.alternative ,.overall approach tocommodity arrangements
(possibly leading toaGeneral Declaration atNairobi )which
canpoint theway forpractical steps forward ;
(c)toensure that thediscussion oftheother major issues is
notonly realistic buthelpful towork inother fora
(e.g. theCIEC ,GATT andIMF).
8.Intheview oftheCommission ,Community tactics attheTDBshould
reflect the fact that whilst themeeting will have auseful role in
clarifying issues ,itneither will norshould negotiate fixed orfinal
positions .The Community should therefore trytoavoid steps which
might limit the scope forfinal bargaining attheNairobi Conference
itself ,andshould aimrather forthelimited anduseful results :
(a)ofclarification ofthedemands oftheGroup of77inthe
*light ofManila ;
(b)ofthetabling orwhere necessary re–tabling ofdraft
resolutions which setoutCommunity /Group Bpositions in
aclear andrealistic way ;and
(c)ofgiving some indication oftheCommunity 'sconceptual approach
tocommodity arrangements andofitspreparedness /disponibiIit£7
toanalyse theUNCTAD list of17commodities according tothis
approach ,asamatter ofpriority ,during thecoming year .Whilst
beginning with this list theCommunity would bewilling toproceed
toanexamination ofother products ofinterest forthedeveloping
orfortheindustrialised countries .

-7-
9«ThiemeafiS"fch&tth®ComnvwiiitywillnotlasinapositioninGeneva
inMarchtoundertakemajornewinitiatives .Butintheviewofthe
CommissionitisessentialfortheCommunitytobeabletohelpevery
waypossible(inParisandinGeneva)inthedefinitionofapositive
GroupBpositiononCommodities,inamannerconsistentwiththe
proposalswhich ,ithasnowbroughtforward.The
Commissionhassetoutthelinewhichitbelievesshouldbefollowed,
intheAnnex:withoutunveilingthewholeoftheCommunity'sposition
priortoNairobithisshouldenabletheCommunityandGroupB,towork
withtheTDBSecretariat andtheGroupof77inpreparingtheCommodities
questionfordecisionatNairobi.AsanabsoluteminimumtheCommunity
mustmakeitclearthatitiscontinuingtogiveseriousthoughttoan
alternativeoverallapproachonwhichitwillbepreparedtoenterinto
negotiations atNairobi.
9bis.InthelightoftheoutcomeofthemeetingoftheTradeand
Development Board,forwhichthepresentcommunication hasbeenprepared,
theCommissionwillpresentafurthercommunication totheCouncilonthe
NairobiConferenceitself.Thiswilltakeaccountoftheresultsofthe
ManilameetingoftheGroupof77jof"thefirstmeetingsofthe
CommissionsestablishedwithintheCIEC,andofthefurtherevolution
ofCommunityandGroupBpositions.

_8_
AXN2X
SUMMARYOFCOMMUNITY POSITION'SOHMAJORSECTORS
COMMODITIES
i-Iainreferencedocuments :
UN3362(S-VIl)-ResolutiononDevelopmentandInternational
Co-operation(esp.:Part1).
TD/B/Cl(VIIl)CG/CRP3–ResolotionadoptedbytheCommitteeon
Commoditiesatitseighthsession.
TD/3/C.l/l93–Anintegratedprogrammeforcommodities
(specificproposalsfordecisionandactionby
governments ).
TD/B/C.L/l66–Anintegratedprogrammeforcommodities (with
fivesupplements onstocks,theCommonFund,
multilateral commitments ,compensatory finance
andtrademeasures).
TL/b/C.1/194–Measuresforindividualcommodities.
TD/B/C.l/l95–Compensatoryfinancing.
TD/B/C.1/196–TheCommonFond.
TD/B/C.I/197–Measurestoexpandprocessingofprimary
commoditiesindevelopingcountries.
S/l320/75RELEX40–UNGA7thSpecialSession:thetertof
theCommunity'sPositionPaper.
1/201/75(DIAL6)–Councildecisiononpositionstobeadoptedin
tneCIEC.
S/v/76(COMER2)–Outcomeofthethirdpartoftheeighthsession
ofUKCTAB'sCommodities Committee,including
Group77andGroupBpapersandCommunity
statements .
S/1847/75(COMER510)–CoveringtheInterimReportofthe0ECDTs
HighLevelGrouponCommodities .
SEC(76)...–Commodities:theCommunity'soverallalternative
approach.

-9-
IkTheCommunityhasindicatedin/ONCTASthatitfavoursthoadoption
ofanoverall,integratedapproach,covering(a)measuresforthe
stabilisation ofexportearnings,and.(b)measureswereappropriatetoimprove
individualcommoditymarketstructures,includingconsideration oftheir
financial ,implications ,inthecontextofnegotiations betweenthe
exportersandimporters.TheCommunityindicatedattheCommodities
CommitteeinDecemberthatitwasstillstudyinganumberofaspectsof
itsapproach;attheTDBinMarchitwillbeexpectedtotakeupa
positiononthefourelementsofthisResolutionthenadopted,i.e.on
theobjectivesofcommodityagreements,onmeasures,onthelistof
commodities,andonprocedures,includingatimetable.
2.TheUITCTADSecretariathas,quitesensibly,saidthat"unlessa
substantialmeasureofprioragreement/can7kereachedamongthe
importingandexportingcountriesconcerned,onthefundamentalpolicy
issueslikelytobeuseful..."(TD/B/C.l/l93,paragraph47)nogeneral
commitments couldbemeaningful.TheroleoftheCommunitymustaccordingly
betodefineand,afterconsultationinOECDandinGroup3,towin
acceptanceinUNCTAD,foritsownproposedoverallalternativeapproach
onCommodities (SEC(76)...refers)asthebasisforthisprioragreement;andto
begintodosoattheTDBbybuildingonelementsoftheGroupBposition
ontheonehandandoftheUNCTADSecretariatpositionontheother
(sinceinsomerespectsthisismoreacceptablethanthatoftheGroup
of77).
Objectives :Therearetwomainareasofdifficulty.
(i)TheUilCTADlist(inpara.7OFTD/B/C.1/193)whichislargely
acceptable,nevertholass containsunhelpfulreferencesto
synthetics,andunacceptable referencestotheissueof
sustainingcommoditypricesin"realterms",etc.The
alternative,overallapproachbytheCommissioncouldbe
helpfulinasmuchasittakesnoteofthelongtermevolution
ofthetermsoftrade,withoutinanywayimplyingthatthis
shouldbeinterferedwithbythepricingmechanism ;andas
alreadyindicated(seeSSC(76)2,para.2)theServicesofthe
Commissionwillbebringingforwardfurtherthoughtsinthis
area.
(ii)GroupBhasyettofindaformulaonaccessandsupply,which
allofitsmemberscouldaccept.TheWorkingGroupofthe
OECD'sTradeCommitteewillbetryingtoresolvethisin

-1&-
early February .TheUNCTAD Secretariat 'sinclusion of
"assurance ofaccess tosupplies ofprimary commodities
forimporting countries "ispreferable totheGroup of
77fsdemand for"... assurances ofsupplies atstable ,
preferential prices ...fordeveloping ,importing
countries "(TD/B/C.l(VIIl) /CG/CRPl–Annex 1,paragraph .
6(iii ).TheCommunity should continue totrytobuild onit.
Measures andTechniques ;The list inGroup B'sinitial working paper
isreasonably comprehensive but itlacks aconvincing
framework .The Commission proposes that itshould be
completed inaccordance with thebroad lines oftheCommunity 's
overall approach andthat itshould beplaced more
specifically inthe context ofthekind ofexamination of
individual market structures which isanimportant part of
this approach .
Commodities tobeCovered :TheCommission have proposed that the Community 's
overall approach onCommodities should beapplied asamatter
ofpriority totheUNCTAD list of17during the 12months
after the Nairobi Conference .This should bemade clear
together with theCommunity 'sopenness tosuggest ,or
accept thesuggestion of,theaddition offurther commodities
ofinterest tothe developing and developed countries
which might also beexamined ,induecourse .
Follow –upProcedures and Timetable :The UN'CTAD Secretariat has
proposed that "some central co-ordinating machinery should
besetup"togive impetus to/commodity /negotiations ,to
assess their progress ,andtodeal with major policy
problems ..." (TD/B/C1/193,paragraph 48).Intheir Manila
paper the Group of77pick upthe same type ofidea and
propose that there should either beaspecial negotiating
committee orthat the directives ofthe Commodities
Commission should berevised inorder toturn itinto a
body capable ofmonitoring progress .Initssecond
statement attheDecember meeting the Community explicitly
accepted that "procedures including atimetable should be
determined atthe4thUN'CTAD ",butexpressed theview that
these should include provision forreviewing progress by
means of"one ofthe Conference 'sexisting bodies .

_11_
3*Insofar asfinanoe isoonoemed the Community should adhere toits
position ofwillingness toconsider joint consumer /producer financing ,
product "byproduct ,andtoleave asanopen question whether ornotsuch
financial arrangements asarefinally made can/should bethesubject of
co-ordinated international action .Atthe Trade andDevelopment Board
theCommunity representatives should therefore seek agreement (a)that
the 17commodities ontheUNCTAD list should beexamined over thecoming
year onthebasis ofthe Community 'sapproach tomarket structures and
oftheGroup Blist ofobjectives andmeasures ,(b)that theCommodities
Commission should benominated asthebody tomonitor progress and
provide technical advice ,and (c)that theother questions including
finance should beconsidered atthe Nairobi Conference itself .
II.MANTJFACTUR3S AND SEM-MANIFACTURES
Main reference documents :
UN3362 (S-VIIl )–Resolution onDevelopment andInternational
Co-operation (esp.:Part l).
TD/B/C.5/L.25 ,Rev. 1–Draft Group of77Resolution submitted to
the 7th session ofthe Special Committee on
Preferences .
TD/b/C.5/34 –Functioning andeffects oftheCommunity 'sGPS.
TD/b/C.5/36 –TheGSPandtheLome Convention .
TD/B/C.5/37 –Effects oftheMTNonsystems ofgeneralised
preferences .
TD/b/C.5/38 –Review oftheschemes ofgeneralised preferences
ofthe developed market-economy countries .
TD/b/C.5/41 –Third general report ontheimplementation ofGPS.
TD/b/C.2/153 –Overall policy onstrengthening anddiversifying
l.d.c .exports ofmanufactures and semi–manufactures .
TD/b/C.2/154 –Recent trends inl.d.c .trade inmanufactures and
semi-manufactures .
* *

-12-
(i)Tiiyj-Tfandnon-tariffolSBtaolee:GPSandMTff
4.Atfirstglance,tradeinmanufactures appearsunlikelyto"bethe
subjectofmajordecisionsatUNCTADIV.Buttherearetwoelements
whichnevertheless showthatitwillfigureamongthekeyissuesofdebate
anddecision.
(i)ThesystemofgeneralisedpreferencesisoneofUtTCTAD'smajor
achievements ,andcannot "beignored:thevariousschemes
introducedbydonorcountriesaremarkedbydifferences of
designandofimpactwhichwouldbethesubjectofcomparative
study,andonwhichsomereflectiononfuturedevelopments
wouldbeuseful.
(ii)TheMTUhavereachedastrategicmomentconcerningthetreatment
whichthedevelopingcountriesmightexpect.TheTokyo
Declaration containedcertaincommitments andexcitedanumber
ofhopeswhichthedevelopingcountriesdobelievehaveyetto
berealised,especiallyinsofarastropicalproductsare
concerned.
Itseemsprobablemoreoverthatthediscussionofmanufactured products
willtakeplaceinthelightoftheprincipleswhichMr.Corearecently
expressed,followingadoptionoftheLimaDeclaration andPlanofAction,
andnotablythetargetofincreasingl.d.c.industrialcapacityto25%of
theworldtotalby1985*
5.ItwillbeimportantfortheCommunitytohaveaclearandconstructive
positiononeachofthesepointsinordertocontributeeffectively and
hopefullytoinfluencethedebate.AndtheCommunityshouldtrytolead
otherGroupBcountriestotakepositiveinitiatives .
6.StartingwiththeGPS,theCommunityshouldproposetheelaboration,
withinGroupB,ofaresolutionaddressed,inparticulartothefollowing
points:
–extensionofpreferencesbeyondI98O;
–betterqualitative andquantitativeutilisation oftheavailable
possibilities :

-13-
-improvement andadaptationoftheCPS'tosieottherealneedsofthe
l.d.c.s,takingaccountbothoftheleastfavouredandofthose o
drawingspecialbenefit;
–harmonisation ofnationalschemes;
–participation incomplementary measures,notablytechnical
assistancedesignedtosupporttheGPS.
MostofthesehavealreadybeendiscussedwiththeOECDandagreement
shouldnotbedifficulttoachieve.
7.Inthesecondplace,theCommunityshouldrecallthatitintendsto
goonimprovingitsownschemeand,keepingto1974asitsreferenceyear
fortariffquotasandimportceilings,tobringaboutasubstantial advance
inrespectofmanufactured andsemi-finished goods.Thischoiceofthe
year1974willleadtoconsiderably increasedimportopportunities .At
thesametimetheCommunityshouldannouncethatinordertoreinforce
thetechnicalassistancemeasuresalreadytakentosecurethebetteruse
ofitsschemeithasdecidedtointensifyitseffortstoprovidedocumentation ,
information andadviceonitsGPS,whichwouldprovideevidenceofits
determination togofurtherinrecognisingitsresponsibilities towardsthe
l.d.c.s.
8.InsofarastheMOTareconcerned,l.d.c.demandsinthenegotiations
havethetwomajorobjectivesof:
–preserving,consolidating ,andimprovingtheGPS;and
–securingspecialandfavourabletreatmentfortheirexports.
WhilstunderliningthespecificcharacteroftheMTN,theCommunityshould
confirmtheintentionsexpressedintheTokyoDeclaration andgivesome
indicationofthewayinwhichtheycanbeimplementedintheinterestsof
thel.d.c.s.
(a)Whilst,intheareaoftariffstheGPSshouldremainstrictly
anautonomousmeasure,itwouldbereasonabletorespondin
somedegreetothel.d.c.wishforgreatersecurityofbenefit.
Thiscouldbeprovidedbymeansofpriorconsultations ,ina
formtobedetermined,intheeventofawithdrawalordiminution
ofpreferences .

-14-
(to)CertainBtapscouldAlsobeconsideredtotakeaccountofthe
effectontheGPSofMENtariffreductionsagreedwithinthe
JOT.Thesizeorstaggeredintroduction ofsuchreductions
couldbeconsidered,inordertomaintainthel.d.c.s
preferential advantagesforanadditionalperiodoftime.
(c)Onnon-tariffobstaclestheCommunityshouldindicatethe
readinesstotakeaccountofl.d.c.interestsbyexamining
theeffectofgeneralsolutions,whichcar*beadaptedto
theirspecificneeds.
(ii)Restrictivebusinesspractices
9.Itcanhardlybedeniedtlar,companiesandundertakings canhavea
prejudicialeffectoninternational tradewhentheylendthemselvesto
restrictivebusinesspracticesorabusetheirdominantmarketposition.
Asystemofinternational controlshouldthereforebesetup,
especiallybetweendevelopedanddevelopingcountries.
10.InthelightofUNCTAD'sworktodate,thefollowingmeasuresshould
inparticular beconsidered :
(a)TheCommunitycouldacceptthelistingofrestrictiveor
improperpracticeswhich,ingivencases,prejudicedeveloping
countrytrade,providedthatthedevelopingcountriesare
requiredtodmonstratethattheirtradehasbeenprejudicedif
theywanttopursuethematter.
(b)TheCommunitycouldagreetostepstomakeavailableandto
distributepublishedinformation onCommunitylegislation.

-15-
(e;Itisdasir&ble -that daveieping eouafitries whieH hav«notyet
done soshould adopt legislation onthesuppression of
restrictive "business practices which ensures that companies
andenterprises made subject toitenjoy afull right of
defence .
(d)Theelaboration ofguidelines to "befollowed "bycompanies and
enterprises onatleast avoluntary basis ,should beencouraged ,
ithas toberecalled that there are fundamental differences
ofview both onthemeans bywhich restrictive business
practices should becountered andontheproper role of
competition within economic policy asawhole .With this in
mind itwould probably bebetter toputthe emphasis on
procedures forvoluntary consultation ,onareciprocal basis ,
between the competent national andinternational bodies .
(iii) Industrial Co-operation
11.The Community canjustly draw attention toitsrecord notonly of
trade liberalisation butalso toitspromotion ofindustrial co-operation
bymeans of:
–itsfinancial assistance ,provided intheYaounde andLome
Conventions ;
–therole oftheEuropean Investment Bank ;
–itsTrade andCo-operation Agreements (e.g. with India ,SriLanka ,
Mexico ,ASEAN ",Andean Group ,etc.);
–itstrade promotion activities ;
–its continued efforts todevelop itssocial andregional policies ;
–itspromotion ofhigh technology Community industries that donot
compete with the l.d.c.s .
Theconsideration offurther steps ,including those discussed inUNTDO ,
will beundertaken within the CIEC ;butthevarious points atissue
will also arise inUNCTAD where the Community will need tobeina0

pesitien ioreplyj ifonly TheOemwunity could
;associate Itself with thesuggestion inthe 77'sManila document that ,
increased ,eo-operation "between UNCTAD andUNIDO could lead toamore
rational institutional structure ..Ifeffected this could facilitate
,discussipn pfproposals foraglobal ,regional ,andsectoral system .
/ofint.ern&ti6nal;*iodTistrial co-ordination .
.XIX ..RECENT INTERNATI OITAL TRENDS ,USTTHE .SPHERES OFTRADE ,MONETARY
CO-OPERATION AND DEVELOPMENT '■
i12.tThere oould beattempts atUNCTAD tolaunch afull-scale discussion pfthe
New 1International Economic Order under this item .Atalater stage ,the
Commission will therefore trytosummarise the stages that have
actually been reached intheMTN ,ininternational monetary reform ,
and irithe development field .

COM(76 )39Final -17-
IV. 'FDTAWCÏAL ASPECTS
13. Thepoints which will beraised inUNCTAD inconnection with thetransfer
ofresources are much the same asthose which ,will bediscussed ,atthe Conference
onInternational Economic Cooperation (CIEC ). Consequently ,thecurrent
discussions towork outaCommunity position fortheCIEC canatthesame time
serve toclarify theline which theCommunity istotake atthenext meeting cf
theTrade andDevelopment Board aswell asatthe4thConference .
14. What theCommunity should trytodoatboth these Conferences isto
see that more resources are transferred and that the terms ofaid and the
geographical allocation ofthis ai.Iareimproved .Thequestion ofthedevelop­
ingcountries' foreign indebtedness also deserves special attention .
(i) Asregards increasing resources ,themost important thing
todoistoreassert theCommunity 'sdetermination toachieve a
substantial increase inreal terms ofofficial development aid (ODA),
andtheposition itadopted attheUnited Nations 7thSpecial Session
onthetarget of0.1% .Inpractical terms this means pressing not
only forgreater bilateral efforts butalso forpolitical incentives
todirect thevarious multilateral andregional initiatives inthe
field ofaid (IDA ,IBRD ,Trust Fund ,etc.). Inaddition ,and
especially inview ofthepresent andforeseeable limitations of
budgetaiy resources ,thecapital markets should beencouraged to
play amore active part indevelopment financing .This could involve
inparticular promoting direct investment ,access tothecapital
markets ,andsetting upanInvestment Trust Fund .
(ii) Itisbecoming more andmore apparent that thescarce resources
ofODA should beconcentrated onthepoorest ofthedeveloping countries ,
and the aim should therefore betosee that the allocation ofaid
corresponds more closely tothedistribution ofpopulation inthe
countries ofthethird world than inthepast .This aimcould be

clearlystatedeitherbyadoptingatargetfigureorbyproclaiming
acommonprinciple.'
(iii)Asregardsimproving'thetermsofaid,theCommunitycould
aimtoseethatthe1972Recommendation oftheOECDfsDevelopment Aid
.Committee(DAC)isredefinedand,morespecifically ,thatthemeeting
arrivesatamorerigorousdefinitionofODA,thatthegrantelement
.ofaidisincreased,andthatthespecifictargetswhicharesetat
presentforthegrant .elementfortheleastadvancedareappliedin
futuretoallofthepoorestdevelopingcountrieswithoutexception.
(iv)Asregardsthequer.icnofthedevelopingcountries'foreign
indebtedness ,theMemberstatesoftheCommunityshouldagree,at
U1TCTADIV,thatageneralconference onthedebtquestionshouldbe
convened.Anumberofgeneralguidelinesforinternational cooperation
overindebtedness couldbeworkedoutintherestricted frameworkof
the"Dialogue".Theseguidelinesshouldstresstheimportanceofa
preventivepolicyonthetermsofaidosolvencyandinparticular
ofincreasing ODA,andplanscouldbelaidforanearlywarningsystem
sothatactioncouldbetakenbeforetheextentofacountry*s
indebtedness becamecritical.Theseguidelinesshouldalsoinclude
rulesonwhatshouldbedoneintheeventofdifficulties ofpayment.
Theserulesshouldstresstheneedtotreateachcaseonitsown
meritsandtotakeagreateraccountthaninthepastofconsiderations
ofdevelopmentpolicywhendebtshavetoberescheduled .
15..Generallyspeaking,theCommunityshouldendeavourtospeedupthe
OPECcountries *integrationintotheinternational systemofcooperation by
considering more.thanthemererecyclingofpetrodollars orthree–cornered

\-18A -
15(a )"tobeinserted attheendofsubsection IV (Financial Aspects )
15Ca)*Asregards monetary questions ,theCommunity should ,irrespective of
the survey ofthefuture development oftheinternational monetary system
which will beundertaken later (see12.),persuade thedeveloping countries ,
andespecially those which arenotoil-producers ,toscrutinize their present
andfuture balance ofpayments situation .This canonly bedone onthebasis
ofanassessment ofthe worldwide economic situation and outlook onthe one
hand ,andofthedecisions recently taken infavour ofthedeveloping countrie
bytheIMFandIBRD ontheother .
Inanyevent ,itshould bemade quite clear that anymonetary approach
tothedeveloping countries 1problems must bediscussed intheappropriate
international organizations .

-19-
v.ffRAKSffËHOFTffCMOLQQY
Mainreferencedocuments:
imCTADResolution39(Hi)
UUResolution3362(S-VIIl),PartIII
UKTCTADCommitteeontheTransferofTechnologyResolution2(i)
(coveringsubmissiontotheTDBofthe3draftsoftheCode).
TD/B/C...–1975UÏCTADSecrétariatReport
TD/B/C.6/1–ReportoftheIntergovernmental Group(May1975):
plussupportingpapersTD/B/C.6/2–8.
TD/B/C.6/AC.1/L.5–RevisedGroupBdraftoutlineCodeofConduct.
TD/B/C.6/14–StructureofoutlineCode,preparedbytheGroupofExperts
A/Conf./62/WP8-LawoftheSeaConference;proposeddraft
Convention .
Commissiondocumentdetravail,lstJuly,1975f°rtheUIICTAD
TradeCommittee.
*
* *
16.UKTCTADResolution39(Hi),datedJuly1974,invitedUNCTADto
considerthequestionofaninternational CodeofConductonthe
transferoftechnology.FirsttheGroupof77and.subsequently
GroupBprepareddraftoutlinestosuchaCodeandthesewereconsidered
atthemeetingofthe"GroupofExperts"whichmetinGenevainMay1975
(TD/B/C.6/1refers)andagainlastNovember/DecemberwhenUNCTAD's
CommitteeontheTransferofTechnologyalsomet.InApril/May1975
thethirdsessionoftheThirdLawoftheSeaConferenceconsidered
themarineaspectsofthetransferoftechnology ;andinDecember
lasttheWorldIntellectual PropertyOrganisation helditssecond
meetingontherevisionoftheParisConvention.UNResolution 3362
statedthat"allStatesshouldco-operateinevolvinganinternational
CodeofConductforthetransferoftechnologycorresponding in
particulartothespecialneedsofthedevelopingcountries"andasked
forworktobecontinuedwithinUUCTAD"intimefordecisionstobe
reachedatthe4thsessionoftheConference,includingadecision
onthelegalcharacterofsuchaCode TheChiefofUNCTAD's

■20-
TransferofTechnology -DivisionappearedbeforeWIPO'sDecember
ConferencetounderlinehisviewthatUNCTADIVshouldbeabletoplay
amajorpartinsecuringagreementonthedraftCodeandofthe
revisionoftheParisConvention(whichdealswithpatentlaw,trade­
marks,businessnames,geographicaldescriptions).Andthesamehope
isexpressedinthedocumentpreparedforManilaonbehalfofthe
Groupof77(77/MM(lIl)l/Rev.AnnexIII,pp.2and3).
17•Duringthepreparations forUNCTADIVitwillbenecessarytokeep
carefullyinmindtheinterrelationships betweentheseveralinternational
organisations involved.ItispossiblethatWIPOwillbehavinga
furthermeetinginMarch,nodoubtwiththeintentionofkeepingdiscussion
oftheParisConventionwithinitsmoreexpertcontextratherthanletting
itbediscussedinthemorepoliticalarenaofUNCTAD).The4thsession
oftheThirdLawoftheSeaConferencewillalsotakeplaceinNewYork
from15thMarchto7thMay,onthebasisoftheJointInformalSingleNegotiating
Text,whichdealsinteraliawiththetransferoftechnology.Against
thisbackgroundourobjectiveinUNCTADIVwillbetoconcentrate onthe
questionofthedraftCodeofConduct,onthebasisoftheGroupBdraft
andwithinthespiritofU.N.Resolution3362,andkeepingtheother
international discussions verymuchinmind.
18.ThepresentsituationontheCodeofConductisthatboththeGroup
of77andGroupBhaveputforwarddrafts:
–thedraftoftheGroupof77envisagesaCodethatwouldbebinding
underinternational law,wouldbeofuniversalapplication and
wouldcontainextremelydetailedandlimitativerules,particularly
onrestrictive businesspractices ;
–theGroupBdraftontheotherhandtakestheformofanon-binding
Codewhichwouldbeuniversallyappliedbothtooriginating and
recipientgovernments andundertakings andwhichwouldcontainaset
ofgeneralandflexiblerules.GroupBbelievethatgiventhelegal
andeconomiccontextofitsmembersandthevarietyandcomplexity
ofthetransactionsthatareundertaken,onlyacodeofthis
typecouldbeacceptableandapplicableinpractice.

-21-
Although -theyhavanerfcputforwardacU-aftoftheirown,GyoupD
haveindicated ,apreferencefortheGroupBtext.Independently of
bothdraft8^expertsofthethreegroupshaveagreedonacommon
outlineofthefutureCodewhilstrecognisingthattheirsomewhatneutral
chapterheadingsinnowayindicatedecisionsonitslegalbasisand
onitscontent.
19.AtthepresenttimetheCommunity'spositionisidenticalwith
thatofGroupBandtheobjectiveatUNCTADIVmustbetosecure
thedecisionrequiredunderU.N.Resolution3362onthelegal
characteroftheCode,onthebasisoftheGroupBdraft.Intheir
ManiladocumenttheGroupof77havetakennoteofU.K.Resolution3362
andofthereportoftheExpertGroupbutaddlittle(savee.g.ontheir
"braindrain")tothedemandswhichtheyalreadyputforwardintheir
draft.Thenegotiations atUNCTADIVwillthereforetakeplaceonthe
basisofconflicting proposalswhichwillmakeagreementdifficult,
20.IntheviewoftheCommissionthefollowingarethemainpoints
tobediscussedatUKCTADIVbeginningattheTDBinMarch.
Tactics
InviewofthepositionsadoptedbytheCommunityatLima
andatKewYork,theCommunityshoulddoitsbesttoreach
acompromisewhichnevertheless reflectsitsmajorconcerns
(assummarisedabove).Itmightindicatethattheprocedures
sofaradopted,(i.e.ofworkingthroughoneExpertGroup)
seemsomewhatinadequateandthatalargernumberofGroups
todealwithspecialisedaspectsmayberequired.TheGroup
of77haveputforwardcertainproposalsastohowtheybelieve
theCodeshouldbeimplemented ,buthavenotsofarshown
clearlyenoughhowitsconceptofabindingCodecouldbeput
intopractice.Moreoverthereareanumberofelementsinthe
77*sdraftwhichwouldappeartobenotsusceptibleto
regulationbyinternational convention.
Possiblelinesofconroronn.se
Itwouldbeapttoinviteagroupoflegalexpertsto
examinethevariouspossibleformulaewhichmightsatisfyi)
(ii)

-22-
Resolution3362withouthavingtoarriveatasingle,
definitivepointofviewatthisstage,thefollowingtwo
formulaemightpossiblybeexamined:
(a)thatUNCTADIVshouldleaveitopentothe77toadopt
theCodeundertheirnationallaw,andtoGroupB
countries(?andGroupD)toadoptitasguidelines;
(b)thatUUCTADIVshoulddecidetomaketheCodethe
subjectofaU.lf.GeneralAssemblyResolution.
Contentandlimitation onpossibleconcessions
IfGroupBisable
tonegotiateonsomeotherbasisthanthe77'sdraftitwill
probablybenecessarytomakecertainconcessions :these
mightbefoundinChapterVIonInternational Co-operation
andSpecialMeasuresfortheDevelopingCountries.The
Communityshouldcertainlydeterminethelimitswithinwhich
concessions mightbemadewithotherGroupBcountries,in
advanceofNairobi
Consequences fortheCommunityifdecisionsweretobetaken
ona"bindingCode
Itwouldbenecessarytoreferanysuchunilateraldecision
bythe77tothelegalexpertsoftheCommunity'sMember
States.Strictlyspeakingonlyaproperlysignedand
ratifiedtreatywouldbebindingunderinternational law,
andtheCommunitycouldfinditselfforcedeithertoaccept
unsatisfactory decisionsortotakeresponsibility fora
failureofthenegotiationsifitalloweditselftobedrawn
intodiscussionofthedrafttextofsuchatreaty.Ifon
theotherhandtheCodeweretobeadoptedbymeans,forexample
ofaGeneralAssemblyResolutioninvolvingneithersignature
norratification ,theextenttowhichthe77could
maintainthatitisbindingwoulddependon
thedegreeofsupportwhichGroupBcountriesfeltableto
givetoit(i.e.whethertheyvotedfororagainstit,or
abstained).AtreatywhichtheCommunityfeltableto

-23-
aeoopt wemld nodoubt winaortal *!political advantages }Taut
intheview ofthe Commission thealternative ofaGeneral
Assembly Resolution appears preferable ,inthelight ofthe
complexities ofthesubgect being discussed ,theimprobability
ofthere being acompromise reflecting most ofthe Group B
points ,andthegreater flexibility itwill give .
VI.INSTITUTIONS
21.Proposals forthe creation ofsubstantial newmachinery
should beresisted .Itwould not be
appropriate toconsider farreaching institutional changes whilst the
MTNareinprogress inthe C-ATT andwhilst thework androle ofthe
CIEC have yet tobedefined .Intheir Manila documentation the Group
of77gave general support tothe definition ofalarger role for
IJNCTAD inevolving theproposed NewInternational Order ,butcame to
nospecific conclusions .
22.TheCommunity might accept ,atthis stage ,theredefinition of
the role ofthe Committee onCommodities asset outunder Iabove .