Last Thursday. the delegates at the United
Nations Conference on Trade and Development
(UNCTAD) came to the closing ceremony. It was
delayed by a few hours because the final document
needed to be translated. A short delay was
acceptable. Far worse would have been deadlock on
the final declaration. It would have delivered a
victory to those who want to see UNCTAD's ability
to continue doing its work curtailed.
Shaking off the momentary lack of
confidence because of the recession, the Global
North has pushed to reclaim its primacy in
financial and trade matters. Its emissaries set
their sights at three conference, UNCTAD XIII
(April), Group of 20 (June) and Rio+20 (June).
At these venues, the Global North intends
to assert its responsibility for finance - none of
the Southern countries, not
even the BRICS states -
Brazil Russia, India, China and South Africa -
would be permitted to have oversight of the
financial sector.
Such matters as
financial sector "reform" have to be left to the
agencies controlled by the North (the
International Monetary Fund, the World Bank and
the World Trade Organization) and the agency of
the North (the Organization for Economic
Cooperation and Development, or OECD).
Despite the pretensions of the BRICS to be
members of the G-20, it was the WTO and the OECD
that have appropriated the right to set the agenda
for the G-20 meeting. The BRICS states, Indonesia
and Turkey seem to be simply colorful additions to
the proceedings.
At UNCTAD, the Global
North, led by the United States and Switzerland,
tried to forbid this multilateral agency from its
investigations of finance's domination over social
life. Still beholden to the 192 members of the
United Nations, UNCTAD is not under the thumb of
the Global North. It has therefore been critical
of parts of the financial architecture. It
criticizes not only the ideology of neo-liberalism
but also the institutions that benefit the kind of
jobless growth that sustains the otherwise
hollowed out economies of the North Atlantic.
At the Doha meeting, UNCTAD released a
report (Trade and Development Report, 1981-2011)
that illustrated the excellent work done by this
UN agency over the past three decades. The Global
North argued that UNCTAD could deal with finance,
but only the effects of the financial crisis in
the "emerging and developing nations". What it was
not to do was to explore the causes of the crisis,
which would take it into an investigation of the
banking sector and the role of monetary policy of
the Northern states. This was unacceptable.
A strong statement by former UNCTAD staff
members stiffened the spine of the negotiating
bloc of the South, the G-77+China (the G-77, so
called for historic reasons, now represents 132
countries). John Burley, a former senior UNCTAD
official, told me that because of this statement,
which he helped coordinate, "and a rigorous
campaign in the media and by civil society
organizations, developing countries were
successful in ensuring that there will continue to
be plurality of views in the international system
on the causes of the present economic crisis and
in the search for sustainable ways out of it.
Fortunately, neither the message, nor the
messenger, was silenced at Doha."
Deborah
James of the "Our World is Not For Sale" network,
which played a key role in Doha, concurs. She told
me, "The combined pressure of an outraged civil
society, a reinvigorated G-77, and skilled BRICS
negotiating support, delivered an outcome that
mandates the continuance of UNCTAD's excellent
research on macroeconomic policy and the global
financial and economic crises. Not only did rich
country overreach contribute to this outcome, it
also helped increase public awareness of the value
of UNCTAD's analytical contributions, as they
challenge the status quo in economic orthodoxy."
By "rich country overreach", James refers
to the role of the Swiss ambassador and US
government officials, both of whom proved that
brusqueness would no longer be appreciated by an
increasingly self-confident South. This
correspondent tried several times to arrange an
interview with the Swiss ambassador to UNCTAD,
Luzius Wasescha, but even after set interview
times did not get to speak to him. At one session,
the US delegate said, "We don't want UNCTAD
engaging in intellectual competition" with the IMF
and World Bank. Such arrogance was not taken
lightly.
While the negotiations took place
behind the scenes, the seminar rooms filled up as
delegates listened to UNCTAD staff and their
guests talk about a variety of issues. Jayati
Ghosh, professor at Jawaharlal Nehru University in
Delhi, spoke at a number of sessions. She told me
that UNCTAD XIII dealt with issues that are
precisely of interest to large and small
developing countries, such as development banking,
regional trade agreements, the nature of financial
regulation, industrial policy, implications of the
rise of the BRICS, energy alternatives for
development, and the relation between development
and gender.
"The high quality of most
discussions showed how much interest there is
amongst policy makers and others from the
developing South," Ghosh said.
UNCTAD
XIII's Doha Mandate underlined the agency's
ability to "continue, as a contribution to the
work of the UN, research and analysis on the
prospects of, and impact on, developing countries
in matters of trade and development, in light of
the global economic and financial crisis"
(paragraph 17, d). Such a mild formulation was
precisely what the North had wanted to prevent.
But, as the Third World Networks' Sanya
Reid-Smith told me, "given the circumstances, the
South managed to get almost everything they
wanted, including a renewal of UNCTAD's mandate to
enable it to continue its excellent analysis
(challenging the orthodoxy of the IMF and World
Bank which has been consistently proven wrong) of
the financial crisis that it has done for the past
four years."
Unable to hold back the tide
from the G-77, the Swiss ambassador tried out an
exogenous tactic. He pointed out that if the G-77
gave up the paragraphs on Cuba and Palestine, the
North would agree to the G-77's phrasing on
finance. The North hoped that dissension in the
South over their political entanglements around
Cuba and Palestine would sink the unity of the
G-77.
This did not happen. The Palestinian
delegate and the Israelis had already agreed on
the paragraph, and it was not enough to raise the
bogey of Cuba (which is what deadlocked the Sixth
Summit of the Americas in Cartagena, Colombia in
the middle of April). As Deborah James remembers
it, "the Swiss negotiator looked crushed." It was
checkmate for the North.
"The result of
UNCTAD XIII was positive in the end," noted
Reid-Smith, "especially in comparison to other
multilateral negotiations [such as Rio+20, the
World Trade Organization's Doha Round and climate
change]".
At those other venues,
Reid-Smith said, the North has been unwilling to
meet their various obligations. She is correct.
But the Doha Mandate sets a very low bar. UNCTAD
XIII at Doha was not a victory for the South. It
was more like a draw. The message it sends to the
Group of Eight and Switzerland is that the BRICS
might not be as seduced by their seats in the G-20
as to forget their affiliations with the G-77.
Heiner Flassbeck, director of UNCTAD's
Division of Globalization and Development
Strategies, said that the Doha Mandate affirmed
"more ahead of the curve analytical work by
UNCTAD" on the global financial crisis. This will
"strengthen our role within the UN system,"
Flassbeck said, and perhaps put some informed
pressure on the other agencies.
Raja
Khalidi, a senior economist at UNCTAD, concurred.
UNCTAD XIII "noted the global economic realities
and UNCTAD's role in providing critical analysis
of their implications." The Swiss Ambassador had a
more measured response, telling Bloomberg that the
agreement "gives more precision" to UNCTAD's
mandate so they "can't just do anything".
But thus far UNCTAD has not been able to
"just do anything". Despite its many achievements,
sections of UNCTAD have been smitten with elements
of neo-liberal policy, such as carbon trading as a
response to climate change. The carbon-trading
model avoids the core problem, namely the North's
energy waste and the South's lack of seriousness
about alternative energy. There has been little
concern for how the UN's Clean Development
Mechanism is destroying forests and livelihoods.
There is also little evaluation of the
mandate of UNCTAD's Center for Transnational
Corporations, whose original mandate - to monitor
corporations and create a Code of Conduct for them
- had been transformed to reflect "the changing
times and become more focused on the positive,
rather than the negative, effects of Foreign
Direct Investment and Transnational Corporations".
These elements of UNCTAD require some more
self-scrutiny. The fierce opposition to UNCTAD
from the North makes any serious self-criticism
far harder to tackle.
Bankers need not
worry yet. UNCTAD's reports do not threaten them.
They do, however, irritate their counterparts at
the IMF, the World Bank and the OECD. Challenges
to their empirical claims and their theoretical
blindness shall continue to fly out of the UNCTAD
offices.
Vijay Prashad is
Professor and Director of International Studies at
Trinity College, Hartford, United States. This
spring he will publish two books: Arab Spring,
Libyan Winter (AK Press) and Uncle Swami:
South Asians in America Today (New Press). He
is the author of Darker Nations: A People's
History of the Third World (New Press), which
won the 2009 Muzaffar Ahmed Book Prize.
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