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COMMISSION OF THE EUROPEAN COMMUNITIES
COM(78)421 final
Brussels t8September 1987
THE COMMUNITY AND THE PREPARATION OP ANEW
•INTERNATIONAL DEVELOPMENT STRATEGY .
« ■ •-guidelines -
S\:> <s*^> "< <>..
\CV ■1*2 ,"V-'A(Communication from theCommission totheCouncil )
V r-C7
/'ν7
COM (78)421final

Introduction
The aim ofthis Communication 1stopaint ageneral picture ofthe situation
1norder toprovoke ,thought within the Community onthe new International
Development Strategy andtofacilitate Community participation ,within the
United Nations General Assembly framework ,inthe various stages Involved
1nthepreparation ofthis newStrategy which ,inaccordance with General
Assembly "Resolution 32/174,will probably beadopted after aspecial session
ofthe General Assembly scheduled for ,1980 .Thediscussions that take place
onthis basis will also serve toprepare the ground forthe high level
meeting ofthe DAC 1nOctober 1978 . "
■(a)Background and stage reached inthe preparations
f ' ' . . - - V
.The new Strategy ,which isIntended toguide development operations
throughout the 1980s and'possibly beyond ,has already formed the subject of 'ν ' * '
several General Assembly and Economic and Social Council Resolutions ,these
being amainly ofaprocedural nature .InDecember 1976 (Resolution 31/182).,
the General A-ssembly asked the Secretary-General togather ,data which would
beuseful 1nformulating anew strategy .InMay 1977,the Economic arid Social
Council ,inits Resolution 2072 (LXII),considered that indevising anew
Strategy account should betaken ofthetexts relating tothe new international
economic order and .ofthe results ofthe many United Nations :conferences that
had taken place since the "adoption ofthe present Strategy ;the Council also
referred tothe need toinclude social aspects inthedefinition ofthe ' 
Strategy .InResolution 2125 (LXIII )ofAugust 1977,the Economic and Social
Council adopted the same~ position and asked the Committee for Development
. .. (1) •- -,Planning tomake the necessary *preparations . ,
(1)At .Its ,14th meeting .<6-16 March 1978 )the Committee for Development
Planning formulated "pre~lim1nary remarks "onastrategy fortheeighties
(Doc.E/1978/46). ' v -

2.
Duringthe32ndsessionoftheGeneralAssemblytheGroupof77
tabledadraftresolution inwhichtheestablishment ofthenewInternational
economicorderwasseenasthemainobjectiveofthefutureStrategy.The
draftaccordingly includedapackageofmeasurestobetakeninthevarious
development sectorsonthebasisofquantifiedobjectivestiedtoaprecise
timetable.For''theirpart,theMemberStatesoftheCommunityhadprepared
aworkingpaper(whichwasnotpresented asadraftresolution )settingoutthe
outlinesofabroaderviewofthefutureStrategy.Asitprovedimpossible
toreachacompromise betweentheGroupofthe77'stextandtheNine's,the
y ■x
GeneralAssembly(Decision32/443)hadtopostponethematteruntl'lits
•33rdsession,atwhichitwillresumeits.examination ofthedraftresolution
presentedin1977bytheGroup"of77,takingintoaccounttheopinionsexpressed
orallyorinwritingduringthe32ndsession.Thisappliesinparticularto
theworkingpaperpresented bytheMemberStatesoftheCommunity._
Atits33rdsessiontheGeneralAssemblywillhavetodesignatethe.
bodyresponsible forhandlingthepreparations forthenewStrategy.Inaccor­
dance ,withthefeelingthatprevailedatthe32ndsession,theEconomicand
SocialCouncilwouldbeinclined .toassignthistasktoitsCommitteeonReview
andAppraisal,enlargedforthepurposetoincludeallthecountriesconcerned,
whiletheCommitteeforDevelopment Planningwouldcontinuetheworkalready
started. ; '
.(b)Purposeofthispaper *;v
ThisCommunication doesnotaimtomakedetailedproposalsregarding
thecontentofthefutureStrategy*Atthepresentstage,theCommunity
needstosetoutthebroadlinesofitspositioninadebatewhichhasonlyjust
started.Excessively detailedproposals wouldseempremature,especially as
>severalveryimportantInternational meetingswhicharelikelytointroducenew
elementswillbetakingplaceoverthenext18monthsinpart1cular.UNCTADV,

. ■3.;
■• -'.'. -, _ . ~
the Conference -onScience and Technology for Development /UNIDG 'sThird General
Conference ,andthe Conference onAgryian Reform and Rural Development .
. .- · .· .
\ -
The positions tobeadopted bythe Community onthe various aspects ofthe -
problem will therefore become clearer asthese conferences .take place ,and
the Commission will induecourse present theCouncil with amore comprehensive
paper designed toprepare thepositions tobepresented bythe Community
atthe 1980 special session . - • ''
• . <• • '-/ ■•;
;;. ■.' - .'' ' '•'"
•! " • ■-\ 1-- - .
1.Review ofthe Second Development Decade (DD2 ) .
(a)Results achieved during DD2 '- •
. ■
Some ofthe overall targets ,set byResolution 2626 (XXV)of1970 have
t
been partly achieved ,according tothe evaluation that has been made
ofthe first half ofthe Decade (1971 ->- 74)(NB :more recent evaluations
will have tobetaken Into account once they all become available ).
This applies 1nparti cular tos: ' * . - :-^
(I) GDP (ahaverage rate ofincrease 6f5.9%per annum asagainst
atarget of6'/.); ' '
(II)manufacturing (growth rate of8.3% per annum asagainst atarget of
.,8%); ■' , ' ^ "■' ' • '
(III)trade (7.Ingrowth rate for Imports /6.5% forexports ,asagainst
atarget of 7%>;.although there has been asharp deterioration since
1?74 ; . ■
*(W)thedeveloping countries 'rate "ofdomesti csavings .

4.
The follQwing two qualifications should beattached tothis overall
'assessment /however
(i)theoverall figures *given above conceal very considerable #
,» , -differences indevelopment levels between developing countries ;"
*(ii)anumber ,ofother equally important targets have not been achieved /
two cases ■inpoint being the development ofagricultural production
- 1 (which hasincreased by1.5 %perannum instead ofthe 4%thought • .
:necessary )and the volume ofofficial aid given bythe industri al'ized
countries (less than half the target of0.7% per annum ).
(b)Critical analysis ofthe philosophy behind DD2 '
One ofthe main weaknesses of DD2 isthat itwas founded onthe over-optimis -
"'tic assumption that a'high level ofgrowth would bemaintained inthe
developed countries and onarather tooone-sided conception ofthe
obligations arising from that assumption-namely that the development
ofthe "developing countries would stem mainly from thetransfer of
part ofthefruits ofthe industrialized countries' growth tothe coun­
tries ofthe South .. ;
Moreover /theletting ofoverall targets valid forall developing countries
has become less and less meaningful aseconomic developments have accen­
tuated the differences between them .
" . *■ . ^ ^ __ ..
_Itshould /doubtless also bestressed that thetargets set Jjn1970 were too
concerned with quantity .Anumber ofqualitative "considerations -connected
with the requirements ofthe poorest populations andthe need toconserve
•the world 'sresources and -take environmental andother problems into ;
acoount -have gradually made themselves felt .
The Strategy for theeighties cannot overlook these aspects .

5.
2.North-South relations atthe end ofthe seventies' •./ •\ ^ :•
Inthe course ofthis decade there have been profound -changes 1nthe respective
situations ofthe developing andindustrialized countries .,and also within
each ofthe two groups .These changes have taken place against'a background ,
ofgreat economic d1s°fder .;:riBing *energy andmaterial prices ,the food
crisis of1973-74 .,serious doubts about the post-war monetary system ,avery
high ,level ofinflation -atedency "towards ,fragmentation ofthe world market .,«t-.
•/r
The main structural changes and long-term trends resulting from this can besum­
marized asfollows
•*r- .-' '• '• "
:From the deveioping :countries' point ofview : /-
CD The sudden emergence ofthe oil-producing countries ,which has enabled
tohave .adirect influence .onthe growth conditions and balance ofpayments
■'Vsituations oftheIndustrialized andnon-oil countries ,andexplains their
:role andresponsibility ascreditors and .their large orders for caplta.l
goods ,infrastructure ,etc .. --
(•ii)The emergence ofnewly-industrialized countries asthe .competitors ofcer-^
tain industrialized country industries onthe markets of -both the industria­
lized countries andthe developing countries ;h?re itmust.be borne in .
mind,however ,that thedeveloping countries arestill more important as
markets 'for the Industrialized countries 1manufactures than assuppliers
■\ ofsuch products andthat theindustrialized countries' ,surplus i:n
manufactures trade with the deve-loping countries has continued togrow .
over the last few years .' ■~
V ' * v • . . '
\'(111)A worsening 'ofthe food situation ?this trend has become evident inmany .
developing countries ,especially inthose whidh are seriously affected ,
asevidenced byadrop of0.5 %per annum Inthe per capita production of
the countries inquestion between 1970 anil 1977 ;moreover ,the developing
vcountries asa.whole are becoming increasingly dependent onoutside sources
ofsupply ,(their aereal imports have doubled since 1970 and are^likely to -
double again by1985). '

(1v) Aworsening ofthe underemployment situation asaresult ofcertain
structural trends (demographic pressure ,thedrift 1from the .land,the
capitalist nature ofindustrialization )which have been reinforced by
theuncertainties anddifficulties inthe world economy and world trade .
(v) Asregards raw materials (except energy ).:here,despite considerable
fluctuations over ,the decade the terms oftrade have stagnated inrelative
terms and there has been aconsiderable reduction ininvestment inthe
development ofThird World countries' mineral resources ;the importance
ofinitiatives such asStabeal should ,however ,bestressed .
(vi) ■Anincrease indebt situation ,espe ciaIlyfor middle-income developing *"
countries ,and achange inthe debt structure (with anincrease inprivate
short-term debt financing ). •
From the industrialized countries'point ofview' - ~
(l) Aslowing-down ofthe gr'owth rate compared with the beginning ofthe
"seventies "and' ac'coiripahied in_"cer'ta in "cases -*by~"serious~ 'regional "dfspari --
\ties"^~wh"i ciThas~meant "a"correspondi ngreduction 'in"the "industri aIized
"count ries' abi 11tytoinauce economi cgrowth' iii"the develop !ngcountries ;
"this '"h'as~i3een~t'c the detriment ofthe poorest developing countries in
parti cular . '
(ii) Anincrease inrated ofinflation :ways must befound toboost
economic activity while avoiding therisk ofperpetuating orencou­
raging this harmful trend .

7.
(Hi)The increased dependence onoutside sources ofmost industrialized
countries since they are having 'tomeet increased oilbills and cope .
V « »with higher prices for certain-raw materialsC of.the new USforeign
trade policy which isevident inthe country 'sfirm resolve toincrease
•.its share ofworld trade );this increased dependence 1salso due to .a ■.
• much closer interrelation between growth inthe industrialized countries
andthelevel ofactivity (andtherefore import flows)' inthe developing ./ v-
countries . , J . *: ,, ■'
(iv) Aconsiderable increase inthe rate ofunemployment' asaresult of.the ;
slowdown ofgrowth and theeffects oncertain -vulnerable sectors of
■/ ■ - * ■ ,increased international competition between industrialized countries an,d .
competition from newly-industrialized developing countries ;this has made '•
■itneeessary for the developed countries todevise internal adjustment . ~
policies inorder to_avoid protection *!streactions ,__/ /
Effects oninternational economic relations ■ J • ■
disruption oftheinternational monetary system , . - •
.(i1)achange inworld flows and' in "the structure ofthe balance of
payments ,
(iii)$)increasing imbalance inthedistribution ofsavings surpluses and
balance ofpayments surpluses onthe one hand and financing requirements
ontheother , ■ . '''■
(1v). intensification ofthe North-South .negoti ations ,which have now .-
become virtually cortinuous andthe increasingly political nature of
international discussion 's.

8.
3*-GeneraLconsiderations regardingtheattitudetobeadoptedbytheCommunity
towardsthenewStrategy -
Considering theimperfections andshortcomings oftheSecondDevelopment
Decadeanddevelopments intheindustrialized anddeveloping countries,an
approachtotheStrategyforthe.eightiesmightbebasedonthefollowing
considerations : w
(a)firstofall,itisnecessaryto_winacceptancefortheideathatwhatis
nowaworldeconomyshould'be managedjointly-inotherwords,theindus­
trializedcountries andthedevelopingcountries nowHaveajointresponsabil'
tytoensurecontinuedgrowthofthe"worldeconomy(indeed,theperformances
oftheindustrialized anddeveloping countriesaremuch-moreinterdependent
thantheywereatthebeginningoftheseventies)and toseethatthisgrowth
isdirectedtowardsagreatermeasureoffairnessininternational economic
-relations.~ !'V -'
Inordertoachievethis,thequestionofhowtheindustrialized countries' '
policiesandadjustments tothosepolicies(restructuring ,-marketaccess,
etc.)affectthedevelopment prospectsofthedeveloping countriesshouldbe
examinedmore-carefully.Therequiredattentionshouldalsobegivento
.therepercussions ofthepoliciesofcertaingroupsofdeveloping countries .
(OPEC,newly-industrialized countries)ontheabilityoftheindustrialized
countriesoftheNorthtocontributetodevelopment .
V
Ir>addition,fargreateraccountshouldbetakenoftheneedformutual
•cooperation betweenthevariouscategoriesofdevelopingcountries(which
isinkeepingwiththeobjectiveofself-reliance advancedbythedeveloping
countries andwiththeeffortsbeingmadetodevelopregionalcooperation).

9,I
.(b),Thedisparities which have arisen (and which arelikely toincrease )-- :
between the developing countries should belooked atnext sothat the
most appropriate solutions can befound tomeet the real ,needs ofeach group
ofdeveloping countries ;this could lead/for example ,toare-examination
.ofcertain schemes sothat they are more suited tothe development ,stage' '
reached .bythebeneficiary countries.' . -',
The Community '?position should b'eput forward cautiously sothat the
developing countries understand' thatthis approach ismotivated solely :
.bythe .search -for •amore efficient development aid mechanism .and _-not ",by ,
apolitical desire todestroy the cohesion ofthe Group of77.
' c;".;\.;- ■'' ' . C :
(c)Thirdly ,the Community should be/selective initsproposals ,i.e. apart
from stressing matters relating tothe general-improvements that need to
bemade 1nrelations between developing andindustrialized ,countries ,it
should emphasize 1anumber ofspecific targets ,ofparamount importance *
.'Failure todosomight mean that the newStrategy would become amere
catalogue ofgeneral options ,whereas efforts should bemade -to -go
further than this anddefine specifl cways ofimplementing thegeneral
guidelines . ;
(d)finally ,the proposals should bebalanced ,I.e.the Community ,inseeking
•todetermine theStrategy's'objectives and means ofaction should bring
Its owninterests tobear inorder toensure .that account istaken of
the negative effects that -measures likely -to .produce excessive economic
*• . . . " . ... »
andsocial tension inthe Member States .,"inparticular incertain regions , -
Qould have ondevelopment operations andalso toencourage public opinion
x"and "governments^to' cdnsider~air"developmenT~prbb~lems~Trom~t}ie~ point of
view ofmutual interest .

10.
4.The Community 'spositions : <
There should betwo sides tothe Community 'spositions onthe new Strategy :
-thefirst involves improving the economic conditions andgeneral framework
inwhich relations between industrialized and developing countries will
■/develop inthe 1980s ;
-the second should becentred onalimited number of -essenti alobjectives
which will guide thepolicies and actions ofboth industrialized and
developing countries . •,
Ca)Inthefirst place ,the Community should adopt aposition onanumber of
general problems ofamacroeconomic nature ,some ofwhich are being
tackled 1nvirtually continuous international negotiations ,while others
reflext more recent concerns . . -
The latter include discussions onthe question .of -the interdependence of -
economies and the need tofind the means ofensuring harmonious and
(1) .. •sustained growth ofthe world economy and world trade' .While .the main
, . . . •
V .aim ofthe Strategy must ofcourse bethe development ofthe developing
countries ,1tmust also bedesigned tocontribute tojt he'growth ofthe world
economy' -. "Inthis connection ,special attention must bepaid
-1nparticular toways ofstimulating demand inthe developing countries
byarranging toIncrease substantially the financial ^transfers tothose
countries .
.The other more traditional matters being discussed 1nawide variety ofinter­
national fora concern Improvements tobe"made 1nthe functioning ofthe
economic relations between the Industrialized andthe developing countries
with aview toenabling the latter torealise their potential and,tothis \
end,tomake the most oftheir gradual inclusion 1nthe mainstream ofworld
economic activity . " - ■ 5. ;
(1)Obviously Nord-North and North-East economic relations ,andforthat matter
South-East economic relations ,must beconsidered aswell,butitdoes not
seem appropriate here toinclude them officially intheoutline for anew -
Strategy . . - : , .

These subjects are inany case dealt with ,atfair Length .1nthetext prepared by
the Nine 1nNew York in1977 .They deal mainly with :
(i)the continuation ofefforts toliberalize trade and the search for more bala
ced and more equitable trade between -North and South ; .«'
<it>rawmaterials ,especially theneed for .improving .thema7ket_sYructure~of
primary commodities ,thejiearch forgre'ater^stabi lity andsecurity inthe
"terms oftrade ,*he_.settjng_up of^satisfactory system ofcompensatory ..
financing ,etc; ' , •x ' •
(iii)the need tomake agreater effort asregarcfethe transfer ofresources and 1f
possible thedefinition of»ays^f achieving the0.7 %target ,which will
probably beextended forthe next decade ;the .need tofind way 'sofreplacing
short-term credits ,which -have come toplay adominating role inthe finan­
cing ofpayment ?deficits ,with longertterm recycled capital ,especially from
o11; ...– ' - -•
Civ)Industrialization ,and the conditions under which the Lima target can be
.achieved and inparticular .the access ofthenewly-industrialized countries'
products tothe industrialized countries'markets ,organization ofsectoral
consultations ,the promotion of$hetransfert oftechnology >etc;
(v)monetary mattery andthe question ofthe "link"between the creation ,ofnew
liquidities and development :,improved access todecision-making machinery ,-
•/etc; - ■•
- i
<'vi)the need toensure better control ofmultinationals .
(1)Some ideas have been put forward such asautomatic transfers ,aspecial .
consumption tax,the use ofpossible savings from -d1sarmament ,-onwhich
aposition must beadopted .

12*
(b)The Community 'ssecond platform will consist in-suggesting some ofthe
.main lines along whith the thinking andaction ofboth North and South should
develop 1nthe 1980s (and passibly beyond )towards achieving targets which '
now appear tobeessential itany progress istobemade towards anew
international economic order .What isproposed here,then ,isa;more practical
-/
approach aimed atidentifying ,more clearly than can bedone indiscussions
onthe general conditions ofthe new international economic order ,those
problems which demand -particular attention andeffort onthe part ofthe
-international community asawhole .
•Inthis regard ,three objectives appear tobeofparticular importance :
.(i)thesatisfaction ofbasic heeds ;this should notbeseen asanalternative
1 totheefforts andaid required toachieve the growth targets ofth£
developing countries,' nor should itappear to'be ameans ofinterfering ■,
.intheir affairs oradirect orindirect method ofimposing aparticular
development model onthenr ;onthe contrary ,itshould beseen asone
ofthe most pressing obligations incumbent onthe industrialized and
" ."developing countries atthe present timedndeed ,thestability ofmany
developing countries depends' onit).What this obligation amounts tois
creating the minimum conditions necessary forreal progress inimpoving
the living conditions ofthe poorest populations .
/ Η
It1sprimari ly.thesatisfaction of.food requirements that ismeant here ,
.The food problem must therefore receive particular attention ifthe new
,Strategy istorepresent anopportunity for making abigger effort tostop
the deterioration that has occurred inthe food situation inmany
developing countries over thepast few "years (the time hasperhaps come for
; ■ '
-"'-"the ,Community toput forward once again aproposal itmade atthe CIEC

13,
-which came tonothing atthe' time owing tpthe opposition from --.
United States inparticular -that' aspecific target shrould beset
"" "- ■ *forexternal aidallocated tothis sector /subject totheprovlso that
appropriate steps would betaken bythe developing Countries concerned
'to mobilize internal resources );inthis context /specific proposals
will also have tobe .made onthe otfier issues connected with the
satisfaction ofbasic human needs (health ,.-training ,employment ,living
conditions and,more generally ,urban ameniti es and problems of
urbanization ,social -infrastructure ,etc).
(II)Another common objective ofmajor -importance isthe need tomake appro -
prlate use ofthe earth 'sscarce recources .Thefirst issue tt^at needs
beraised here 1sthe energy problem ,which ,issomething that the
developing countries will eventually .have toagree todiscuss .The
subject ofenergy should not bebroached solely from the point ofview
ofoil but also interms ofthe economic utilization of,reserves ,
substitute sources ofenergy ,inparticular renewable ones ,etc. *
Asecond specific subject which should bedealt with indepth isthe su(i~
.ply ofrawmaterials ;particular points toberaised here arepossible
ways ofeffecting the investment required toensure satisfactory .exploi­
tation ofthe resources avai lable ,the useofrenewable "rawmaterials ,
recycling ,exploitation ofthe seabed ,etc.Anumber ofother ,subjects
.<- covered bythis general theme should also be "discussed ,in .partl cular
the environment ,andtheprotection ofnatural conditions (the fight
against desertification ,pollution ofthe sea,the problem ofwater ).
(III)Thethird objective isthe need tofind ways and means ofarriving at
aninternational division of "labour that will give the developing -
countries a..bigger share ofinternational trade andincrease their
involvement inthe world economy .This theme covers 1nparticular
the problem ofcoherence between thepolicies pursued bythevarious
countries ,especial lyin.the development ofindustrial activities ,
.•andthe adjustments which this entails . '

14.
Inthis context /special attention should also bepaid tothe
problem ofmutual cooperation between .developing countries /as
'/ many ofthem are concerned toattain acertain level ofself-reliance
Indevelopment (seethe conclusions ofthe .1976 meeting 1nMexico /
the UNCTAD discussions ,the conclusions ofthe meeting of
non-aligned countries' ,1nHavana in1978/etc).
'.Itseems worth noting herd that this approach geared toindividual
.objectives will probably lead tothe creation ofnew categories among *.
-• the developing countries based not somuch ontheir level ofgeneral *
7development (astends tobe'the case atpresent )asonthe degree .
^ofimportance which aparticular country attaches -tothe attainment
ofthe abovementioned objectives ..
5.'Final considerations
••Ifit1stobeeffectively applicable /the new-Strategy must /unj.i"ke the
.resolutions onthe new International economic order oronthe Charter
ofthe Economic Rights and Duties ofStates /bethe result ofagenuine
consensus among all theparties concerned .
Application ofthe Strategy will have tobemonitored insome -way
according toaprocedure tobedetermined .Itis'truethat the review
and assessment procedure devised forthe present Strategy has been unsa­
tisfactory .The mid-course review /inparti cular /wasconducted under •
"•arduous conditions and inarather tense atmosphre .
These difficulties could largely beprevented ifthe new Strategy were
not simply acatalogue ofquantified rigid targets .Covering as1tdoes
arelatively long period oftime and being likely tobeaffected byrapid
and unforeseen changes /itshould bedevised insuch awaythat 1tcan be
adapted toanever-changing situation .Ifitwere too rigid itmight
become toofar removed from reaCity and make discussions'on its implemen­
tation more difficult . - ^

i
15.
At -theinstitutional level ,the approach bythe .Community should therefore /
becarefully considered inorder todetermine its implications .Itcan be­
' 9' * 'V•' . *.
■said that the present structure ofinternational debate ,which isioncernecT
inpart icular with defining new general ,condit ions forinternational economic
relations , -must provide greater scope for more ,flexible forms o-fanalysis and' ,
discussion which coul-d beadapted more easi ly .tothe developments that are
bound toOccur inthe decade ahead and beyond . ,Inmaking ,these adjustments
.spfcial attention should bepaid tothe need toput' astop' tottheproliferation
xofinternational meetings ,since this places anexcessively heavy burden on ;
the governements ofdeveloping countries inparticular and inmany cases''
takes uptoo much oftheir administrative capacity . v .
Bythe same token ,asfar asthe timetable forthe implementation of .the new
Strategy isconcerned ,the Community should endeavour toseethat the end-of ^*.
,decade deadlines <1990,oreven 2000 )are' understood asbeing indi cative and
that ,onthe contrary ,the various stages ofthe Strategy should bemapped out
.asrealistically aspossible interms ofthe feasibl lity ofthe objectives . .
proposed . . " - ; ■