Fifty years of promoting trade and development

1 July 2014
ITC News
A changing international landscape means changes for development aid, too, writes UNCTAD Secretary-General Mukhisa Kituyi

In 1964, when both the United Nations Conference on Trade and Development (UNCTAD) and the International Trade Centre (ITC) were created, it was in many ways a very different world. Trade helped to perpetuate the sharp distinction between North and South that had existed prior to decolonisation. Newly independent countries relied on exports of raw materials to their former colonial masters and, in turn, imported high-valued-added manufactured goods from them.

At the time that United Nations Member States gathered in Geneva for UNCTAD I, these newly independent countries sought to take control of their own development pathways. Many viewed trade as a promising means to that end. They wanted a forum where rich and poor countries could come together and engage in a dialogue on how to address international economic imbalances, level the playing field and make sure that developing countries would not forever remain on the margins of the global economy, but also partake in the benefits of trade.

With the founding of UNCTAD, the universal membership of the United Nations embraced an inclusive and forward-thinking development perspective. It sought ‘a better and more effective system of international economic co-operation, whereby the division of the world into areas of poverty and plenty may be banished and prosperity achieved by all.

From that first ministerial conference, the ideas and policies conceived and negotiated at UNCTAD have helped to shift international focus onto the needs and priorities of developing countries. In trade, for example, the idea of providing preferential treatment for the exports of developing countries can be traced back to UNCTAD I. This resulted in the Generalized System of Preferences, which was later recognized by the General Agreement on Tariffs and Trade. It came at a time when tariffs were on average five times higher than today and when previous trade negotiations had been mainly concerned with products of interest to developed countries.

At the same time, it was clear that developing countries needed support, including information and advice, to take advantage of trade opportunities and to ensure that these opportunities translated into real developmental gains. As part of the effort to build such capabilities, UNCTAD and GATT joined forces to create ITC.

In the ensuing years, UNCTAD and ITC have helped to promote economic development, both separately and working together. Focusing on the exporters, traders and those responsible for trade promotion, ITC has been instrumental in connecting with the business community, especially the small and medium-sized enterprises that are important in building the productive capacities of developing countries.

At UNCTAD, innovative thinking, research and analysis have contributed to informing and shaping the global development agenda. This, along with consensus-building and technical cooperation, has helped to foster national capacities in trade and economic development. In addition to being the birthplace of the GSP, UNCTAD’s proposition that donor countries commit to an aid target of 0.7% of their gross national income was later translated into a commitment within the Millennium Development Goals. UNCTAD’s call for debt relief in developing countries became the basis of the Multilateral Debt Relief Initiative. UNCTAD was also one of the first UN bodies to draw attention to specific challenges faced by least developed countries, today known as LDCs.

Today’s world is much changed from 1964. Divisions between North and South, as well as East and West, have blurred. Some developing countries have emerged to become global players and some have transitioned economically. At the same time, some industrial nations have slumped into prolonged crisis. Other developing countries remain marginalized in the global economy. We are all confronted with enormous challenges in the areas of finance, food security, climate change, inequality and poverty.

At UNCTAD, our work has evolved to reflect the altered international landscape. It includes, for example, issues of investment, south-south cooperation, trade and gender, financial volatility and climate change. In this context, it is auspicious that the 50th anniversaries of both UNCTAD and ITC take place when the international community is drawing up a sustainable development agenda for beyond 2015.

Since taking office in September 2013, my priority has been to strengthen the contribution of UNCTAD to this drive for development that is economically and environmentally sustainable. We are supporting the work going on in New York to establish sustainable development goals and expect this to intensify.

UNCTAD will increasingly focus on research, policy proposals, inter-governmental negotiations and technical cooperation on ways of translating sustainable development objectives into real progress and improved livelihoods for people, especially those who continue to live in poverty. It is clear that trade is among the forces that can enable such gains. We have recently stepped up our collaboration with ITC to help countries implement the WTO Trade Facilitation Agreement reached in Bali, Indonesia in 2013. We at UNCTAD look forward to working with ITC for decades to come.