The Stockholm Initiative on Global Security and Governance

April 22, 1991

TABLE OF CONTENTS:

- PREFACE

- PEACE AND SECURITY

Strengthening the United Nations

Regional Security Arrangements

Limiting Arms Trade

The Peace Dividend

- DEVELOPMENT

Focus on Poverty

A Conducive International Environment

- ENVIRONMENT

- POPULATION

- DEMOCRACY AND HUMAN RIGHTS

- GLOBAL GOVERNANCE AND INTERNATIONAL INSTITUTIONS

Reforming the United Nations

Universality in World Economic Cooperation

In the Spirit of San Francisco

- SUMMARY OF PROPOSALS

- PARTICIPANTS IN THE STOCKHOLM INITIATIVE

PREFACE

The world today has a unique opportunity to meet the global challenges. Securing peace, sustainable development and democracy requires nations, in their common interest, to create a new system of global security and governance. We believe that the time is right for nations to take that great step forward, living up to their common responsibility. The transformation of relations between East and West has ended the Cold War, freeing minds and resources that for so long were bound by sterile confrontation. The momentous changes in East West relations in the final years of the past decade have provided new openings for the world in the 1990's. Though the openings are real, the process is fraught with dangers, including, in particular, the extreme difficulties facing the transformation of the Soviet Union. The conflict in the Middle East, following Iraq's invasion of Kuwait, has revealed the weaknesses in the present system for international peace and security. Freed from the constraints of the Cold War, the Unit

ed Nations did respond in an unprecedentedly speedy way to the crisis. Yet the organization was neither in a position to prevent the crisis, nor to solve it in a peaceful manner. World leaders must now act determinedly to build a new system for peace and security, on both a global and regional scale. Failing this, the 1990's may become a decade of dangerous instability. Such a new system must meet the interests of all nations, strong and weak alike. Resolute action must be taken by the United Nations whenever international law is broken. Fears must be allayed that double standards played a role in making possible the international response to the Gulf crisis, and we must now make sure that military culture is not given a new lease of life. A system of security, on global and regional levels, must build on principles of sovereignty and universality, and not on the military might of individual powers. Peace and security will not be achieved unless international cooperation is extended also to deal with the thr

eats that stem from failures in development, environmental degradation and lack of progress towards democracy. Injustices that prevail throughout the world are a constant threat to the security of nations and people. Increasing economic and ecological interdependencies have not been met by a corresponding strengthening of global cooperation and governance. As we enter the new decade, the opportunities for progress in international cooperation are greater than ever before. Collective security can be achieved. Poverty can be reduced, and in foreseeable time extreme poverty can even be eradicated. Environmentally sustainable development is possible. Democracy and human rights are universal and increasingly potent values. A new spirit of cooperation has been seen in many areas, but nowhere, perhaps, more evidently than in the trend towards revitalization of the United Nations. The organization has played a significant role as many regional conflicts moved towards resolution during the latter part of the 1980's.

After a decade, the greater part of which was characterized by selfishness and arrogance, we need to restore global morality. We need the vision of being one global neighbourhood. That is the idea of international solidarity, without which humankind might not survive the next century. We need a new world order, based on justice and peace, democracy and development, human rights and international law. These visions led in the 1980's to a number of initiatives, taken by leading statesmen who shared the conviction that the increasing global interdependencies could only be dealt with by common action. More than ten years ago, the former Chancellor of West Germany, Willy Brandt, formed an international North South Commission. Being an independent group, the Brandt Commission could freely embark on a most imaginative project. In 1980, the Commission presented its analysis and its proposals for improving relations between industrial countries and developing countries. With its new thinking on mutual interests and s

olidarity between people and nations, the Brandt Report had quite an impact on public opinion. In the report, Willy Brandt wrote that reshaping North South relations is the greatest social challenge to mankind for the remainder of this century. He added:

"While hunger rules, peace cannot prevail. He who wants to ban war must also ban poverty. Morally it makes no difference whether a human being is killed in war or is condemned to starve to death because of the indifference of others."

However, the "Programme for Survival" could not convince the decision makers of key countries. While they accepted the idea of a first North South summit (held in 1981 in Cancun), they disliked most of the recommendations for a profound change in international economic relations. Similar was the response to the second report, "Common Crisis", that focussed on debt and energy issues. Ohviously, the invasion of Afghanistan and the following East West confrontation had heated the international political climate, in a way that was not conducive for improving North South relations. It was in the face of these deteriorating relations between East and West that in 198() the late Prime Minister of Sweden, Olof Palme founded his Independent Commission on Disarmament and Security Issues. It dealt with another major aspect of global interdependence, that of security and the threat of nuclear war. The Palme Commission discussed confidence building measures and disarmament. It furthered a new concept, "common security",

which in 1982 also gave the report ItS title. Olof Palme wrote in that report:

"There can be no hope of victory in a nuclear war, the two sides would be united in suffering and destruction. They can survive only together. They must achieve security not against the adversary but together with him. International security must rest on a commitment to joint survival rather than on a threat of mutual destruction."

The aim of the Palme Commission was to promote a downward spiral in arms. It elaborated a broad programme for reducing the nuclear threat by test bans and non proliferation agreements. It agreed on the need for a further build down of conventional forces and a ban on chemical weapons. All these proposals are still valid. Like the Brandt Commission, it also proposed measures for controlling the arms trade. And forcefully, it argued the effectiveness of confidence building measures. The Palme Commission also paid particular attention to the security needs of the South, and suggested ways of strengthening the United Nations. Many of the key ideas of the Palme Commission, including the concept of common security, are now being taken up but only after a costly delay. All through the 1980's, the arms race continued, and violent conflicts took the lives of millions of people. In response to growing concerns about the global environmental situation, the World Commission on Environment and Development was set up. T

he Secretary General of the United Nations called upon Gro Harlem Brundtland to chair the commission. It presented its report in 1987 called "Our Common Future". The Brundtland Commission found that present development patterns could not be allowed to continue. While economic and social development suffered from severe national and international imbalances, threats to the environment were becoming global in scope and devastating in scale. But the Commission also found that necessary changes were possible, that humankind had never before had greater possibilities to break out of the negative trends of the past. To do so would require political reform. a fair access to knowledge and resources and a more just and equitable distribution within and among countries. The central concept introduced by the Brundtland Commission was that of "sustainable development". The report wrote:

"Sustainable development seeks to meet the needs and aspirations of the present without compromising the ability to meet those of the future. Far from requiring the cessation of economic growth, it recognizes that the problems of poverty and underdevelopment cannot be solved unless we have a new era of growth in which developing countries play a large role and reap large benefits."

The report emphasized the increasing importance of interdependence in coping with global environmental problems. It brought out the strong connection between problems of environment and problems of development and security, and showed that meeting these challenges requires a coordinated and integrated approach. During the final years of the decade, another commission was formed, the South Commission. Chaired by the former President of Tanzania, Julius Nyerere, it dealt with the situation of developing nations, and in particular with the possibilities and needs of strengthening SouthSouth cooperation. It presented its report, "The Challenge to the South", in 1990. While recognizing the importance of a conducive international environment for development, and calling for efforts to revive the NorthSouth dialogue, the report stressed the responsibility of developing countries to ensure a better future for themselves. It devoted much attention to economic and political reform and the importance of improving domes

tic economic management. It advocated a people oriented strategy and came out strongly for strengthening democracy and for curbing authoritarianism, corruption and militarization. The last paragraph of the South Commission's report expressed this clearly:

"In the final analysis, the South's plea for justice, equity, and democracy in the global society cannot be dissociated from its pursuit of these goals within its own societies. Commitment to democratic values respect for fundamental rights particularly the right to dissent fair treatment for minorities, concern for the poor and underprivileged, probity in public life, willingness to settle disputes without recourse to war all these cannot but influence world opinion and increase the South's chances of securing a new world order."

There is one basic common denominator in the thinking of all the four independent Commissions: no nation can resolve its own problems without relvi~ on others The Commissions spelled out our interdependence. They emphasized that we must work together to be able to live in one world, to reach a common security, to have a common future. In early 1990, after the momentous changes of 1989, Willy Brandt assembled members of his own Commission, together with several representatives of the other Commissions. They met at Konigswinter, outside Bonn, and reviewed the 1980's and outlined new prospects for the 1990's. There was solid agreement that the major challenges of the 1990's could be mastered only by coordinated multilateral action. As a result of the Konigswinter meeting, Prime Minister Ingvar Carlsson, Sir Shridath Ramphal and Minister Jan Pronk were asked to form a Working Group. Their task was to make an assessment of the new opportunities, and to suggest major areas for multilateral action. One year after t

he Konigswinter meeting, we assembled in Stockholm, at the invitation of Prime Minister Carlsson. Inspired by the themes of the earlier independent Commissions and on the basis of a memorandum presented by the Working Group we have tried to outline some elements of great relevance for the 1990's. In this Stockholm Initiative, we put forward a number of proposals which we believe require urgent action. We may not all agree with each single suggestion, but the need for a comprehensive effort is recognized by us all. We are convinced that the present is a uniquely propitious time for an initiative to be taken, that responds with imagination and boldness to the manifest needs of the present and the future.

Stockholm, April 22,1991

Ali Alatas Manuel Camacho Solis

Patricio Aylwin Azocar* Fernando Henrique Cardoso

Benazir Bhutto Ingvar Carlsson

Willy Brandt Jimmy Carter*

Cro Harlem Brundtland Bernard Chidzero

Reinaldo Figueredo Planchart Bradford Mor.se

Bronislaw Ceremek Julius Nyerere

Abdlatif Al Hamad Babacar Ndiaye

Mahbub ul llaq Saburo Okita*

Vaclav Havel * Jan Pronk

Edward Heath Shridath Ramphal

Enrique Iglesias Nafis Sadik

Hong Koo Lee Salim Salim

Stephen Lewis Arjun Sengupta

Michael Manley* Eduard Shevardnadze*

Vladlen Martynov Kalevi Sorsa

Thabo Mbeki Maurice Strong

Robert Mc Namara * Brian Urquhart*

*Could not attend, but has agreed to support the paper.

PEACE AND SECURITY

We are at a moment in history, perhaps not experienced since the end of the Second World War, when questions of how to assure peace and security can be addressed in a constructive and fundamental way by the nations of the world. It is a unique moment of opportunity, but also of great risk. The Cold War has come to an end. The conflict between East and West led to a divided Europe and to global rivalry between the two superpowers. It has consumed enormous resources that could have found a better use. Not only has it involved two opposing alliances. It has also fuelled violence and war in many parts of the South, by blocking genuine international cooperation and often also the constructive search for effective policies, promoting development and averting environmental threats. The transformed relations between East and West have opened possibilities and made obvious the need for a new security order. The concept of common security has in practice been recognized by the world's two leading military powers a

nd is now gaining wider recognition. To diminish the risk of serious conflicts elsewhere in the world, a new security order needs to be established based on the idea of collective security. The divided continent of Europe has become a continent of ambitious cooperation and integration. The most substantial disarmament treaty ever was signed in Paris in November 1990, at the Summit of 34 Heads of State and Government. It was the result of a process of dialogue that has proved to be of tremendous power. Visions of a peaceful continent, with no more boundaries between its peoples, are now being transformed into practical political decisions through the Conference on Security and Cooperation in Europe. However, overcoming the difficult transition in Central and East Europe is of vital importance. In particular, it is of great concern that the transformation of the Soviet Union succeed in a peaceful way. Institutions and forms of assistance that aim to avert the risk of new conflicts and of a new economic and soc

ial divide are now being established. Obviously, all causes of conflict are not removed by the transformed East West relations. The best example is the recent crisis in the Middle East. But, as a result of the new political climate between East and West, a number of other conflicts in the South have moved towards resolution. That is true, for example, in Southern Africa, in Central America and in different parts of Asia. Continuing injustices and unmet and conflicting aspirations by nations and peoples still, however, constitute dangerous threats to security. National, ethnic and religious conflicts risk being escalated into violence and war. They are a major challenge to international cooperation in the 1990's. There is thus a clear need to strengthen global and regional mechanisms for conflict resolution.

Strengthening the United Nations

On the global level, the time is ripe to implement the international security regime based on the Charter of the United Nations. For the first time since the late 1940's, there is agreement among the major military powers to act together to prevent war and to solve conflicts. The system of international peace and security which we seek must be comprehensive and universal, and protect the interests of the weak as well as the strong. The burden of making the world safe for all should also be shared by all. For a new world order, it is vitally important that the United Nations is made stronger and more effective.

We propose improved United Nations capabilities for anticipating and preventing connicts, in particular the establishment of a global emergency system.

The Secretary General is already authorized to bring to the attention of the Security Council "any matter which in his opinion may threaten the maintenance of international peace and security". But for monitoring the world situation, the Secretary General needs at his disposal a structure for political assessment in critical areas, as well as suitable technology. He should be the first to know when a conflict may develop and then be able to be the first to take preventive action. Permanent political offices in key regions, military observer teams, fact finding missions and military collective security forces could constitute a global emergency system, a kind of "global watch", to be deployed before conflicts grow violent. It should be prepared swiftly when the United Nations is alerted of an acute threat. It would constitute a "tripwire" for potential aggressors, leading them to reconsider hostile action. Such a global emergency system should be supported by a political agreement among the present permanen

t members of the Security Council to exercise restraint in using their veto power.

We propose the elaboration of a global law enforcement arrangement, in line with the United Nations Charter, focussing on the role of sanctions and on military enforcement measures.

The mechanism for carrying out Security Council decisions needs to be developed and be made more systematic in several ways. Resolutions taken must be continuously monitored as to their implementation. Peace making efforts is one part of such a mechanism. They include mediation, concerted diplomatic activity, conciliation, good offices, etc. A more active role for the International Court of Justice could also be included. The role of the peace keeping operations should be expanded. They should not only deal with monitoring cease fires and other means of ending and containing armed conflicts. In other roles, peace keeping forces could ensure that countries are not destabilized across frontiers. UN missionscould be used to oversee elections, as was the case in Namibia and Nicaragua recently. They could be put into work where there appears serious risk to international security, also in cases of internal conflicts which have an impact on other countries or where human rights are grossly violated, as well as in

terrorist incidents and environmental catastrophes. The UN peace making capabilities could also be greatly improved by the establishment of a net of political offices of the Secretary General in various countries. These would be used not only to provide political assessments, but also to foster confidence building measures and political arrangements in the regions of their location. They would be peace making in the real sense of preparing the ground for peaceful relations on a continuous basis. In the event that violations of international law take place, there must be a clear understanding on the law enforcement measures, their sequencing and timing, that the international community can take. In particular, the roles that economic and other non military sanctions are to play must be strengthened. As military enforcement measures may sometimes become necessary, the potential of the Military Staff Committee of the Security Council should be reviewed. This committee, practically dormant during the years of th

e Cold War, could have a significantly more important role to play.

We propose organizational and financial measures to strengthen the United Nations capabilities for peace keeping and peace making operations.

It is not satisfactory that peace keeping and peace making operations are delayed by the present unclear organizational structure and by the cumbersome process of having to secure finance. A new system for administrating and financing these operations is needed. One way to secure finance is for countries to commit resources on a "draw asneeded" basis. Another is to build up a special reserve fund, earmarked for peace making and peace keeping operations, with money raised through mandatory contributions from all members on the basis of a formula which is set by the General Assembly. Military units in the armed forces of all nations could be earmarked for peace keeping tasks, along with airlift facilities and modern communication equipment which could be put at the disposal of the political offices around the globe.

Regional Security Arrangements

When the 34 leaders of the states in the Conference on Security and Cooperation in Europe met at the Paris Summit in November 1990, they could rejoice in the success of a project which had been seen as more or less uncertain, not so long ago. The project is the Conference itself, and the process it has gone through. It can now show some quite remarkable results, fifteen years after the first Summit in Helsinki in 1975. This Conference has worked in several fields or "baskets" with security, with economic and environmental relations, with human rights. It has strengthened the security of all European states, through a comprehensive treaty on conventional disarmament and through several sets of confidence building measures. It has promoted the legitimacy and respect for human rights in all European nations, and contributed to preparing the ground for the peaceful revolutions of 1989 in Central and Eastern Europe.

We propose Regional Conferences on Security and Cooperation to be tried I in regions also outside Europe.

Regional Conferences on Security and Cooperation could provide a framework for cooperation not only on security issues. The economic and environmental, social and cultural spheres could also be included, as could human rights issues. In some areas migrants' rights will be an important matter. Obviously, there is urgent need for such an arrangement in the Middle East. In regions on all continents of the South there appears at present the possibility of initiating security arrangements. Particularly in Asia and the Pacific there are prospects for progress for such initiatives. We are aware that the European experience cannot be simply copied elsewhere. Each Regional Conference should consider its own code of conduct and confidence building measures, as applicable in that parI ticular region. Each could negotiate agreements on arms limitations and | reductions. Zones free of specific types of weapons could be established. Cooperation in security matters, including the drafting of proposals for confidence buildi

ng measures, could be supported by scientific peace research in the regions themselves. Earlier, the actions of the big powers far beyond their own borders have constrained the possibilities of other countries to develop their own regional security arrangements. It is now the responsibility of these countries to make use of the new opportunities. One concept to consider for the future is a global security treaty system, which would include voluntary decisions to limit the arms of each nation. Such a system could be built and developed from a series of regional treaties.

Limiting Arms Trade

The rapidly increasing trade in arms constitutes a particular problem, as evidenced by the enormous sales of weaponry to Iraq over many years. Though arms trade only partly can be seen to contribute to the outbreak of conflicts, it is an important factor in situations when war is threatening to break out. Limiting arms trade, in particular arms sales to areas of potential conflict, is an important objective for the international community, as stated also in the Charter of the United Nations. Now after the Gulf War, there is a clear risk of a new and dangerous spiral of arms transfers, involving weapons with the newest modern technology. The huge nuclear arsenals, wherever they are, still pose a threat to survival of mankind. The arms markets are heavily concentrated in the third world, which buys 75 per cent of the arms traded each year. Significant volumes of arms are now also sold by third world producers. Any suppliers agreements to limit sales will need to bring in also these countries. Information on ar

ms trade is severely limited by official secrecy and the prevalence of shady deals. Clearly, greater knowledge and transparency would enhance the possibilities of limiting conflict fuelling arms trade. The United Nations and independent institutes have important roles to play in that context.

We propose that the monitoring of world arms trade, particularly by the United Nations, be strengthened with the purpose of eventually agreeing on global norms, regulating and limiting trade in arms, and focussing on both supplier and recipient countries.

The Peace Dividend

The transformation of the East West relationship does not only give political advantages. It should give a unique chance to release substantial resources the material side of the peace dividend. The risks of renewed armaments, as well as the many domestic demands, are creating considerable concern as to the size of the savings. However, already agreed disarmament should create a considerable peace dividend. This is because the former confrontation in Europe still absorbs the bulk of global military spending at least $ 600 billion out of a total of $ 950 billion a year. Considerable annual reductions in military spending are quite possible. Based on calculcations by SIPRI, the potential peace dividend in the North can be estimated at around $100 billion a year, possibly rising to between $ 200 and $ 300 billion a year by the year 2000. Total potential savings would then be between $1500 and $ 2000 billion during the course of the 1990's. There will certainly be significant adjustment costs as armed forces

are cut and military hardware scrapped. These may show up in retraining costs for retrenched personnel, or in reduced productivity and exports of defence industries. In extreme cases, it may even be more costly to scrap a weapon than it was to build it, specifically, as the scrapped weapons often leave environmentally very hazardous waste. These costs are considerable, but not essentially different from adjustment costs in other areas of the economy. The benefits of the change far outweighs these costs, particularly in societies where military expenditures have been such a burden that there is an imminent need for change. Retraining costs and alternative investments are, in fact, a reallocation of resources from destructive to productive purposes. These relate to the use of the peace dividend, and should not be deducted from the potential savings. The peace dividend has to be secured. It is a self evident source for resources needed to meet new challenges. We recognize that many domestic tasks also make leg

itimate demands on the peace dividend e.g. investments in environment and in human development. However, we do believe that the reasons for international cooperation are so compelling today that they warrant an ambitious target.

We propose a pledge by governments in the industrialized countries to allocate a specific part of the peace dividend for international cooperation.

For instance, if an ambitious target of one third of the military savings was set, about $30 40 billion would be released annually for such cooperation. These resources should as far as possible be channelled through international institutions which have a proven record of working well in their particular fields.

There is a possibility of a considerable peace dividend also in the South and there is a need for it. Military expenditure has risen three times as fast in the developing countries as in the industrial countries over the last three decades. In many countries in Africa and South Asia, military spending is two to three times spending on education and health. Having peaked at over $170 billion in 1987, third world military expenditure has now fallen somewhat. In parts of the South, this military build up has been a consequence of the Cold War. In some countries, the function of the armed forces has mainly been to preserve the rule of dictatorial regimes. With the ending of the Cold War, with the growth of democratic values and the development of global and regional security arrangements, spending on military armaments in the South should also decrease substantially. In assisting developing countries overcome economic difficulties, especially in financing economic recovery programmes, international institution

s and donors must pay more attention to the actual priorities in government spending set by developing countries themselves. Countries with high military expenditure to the detriment of human development will face increasing difficulties in attracting international assistance.

We propose a commitment by governments in the South to substantially reduce their armed forces, with the purpose of creating a peace dividend to be invested in human development.

To appreciate what could be achieved with the savings from reduced military expenditure savings of $ 30 40 billion out of total expenditure of close to $1000 billion a year a comparison could be made with the following estimates of additional financing needs for investments in human development:

UNICEF estimates that to significantly prevent child mortality and malnourishment for 50 million children, $ 2.5 billion a year would be needed. WHO's programme of "Health for all" would cost about $1 billion a year up until the year 2000. UNDP and UNESCO estimate that it would cost about $ 5 billion a year to assure that every child has access to primary school by the year 2000.

If we are to give a new global security order a chance, we must at the same time start to deal with challenges to security other than political rivalry and armaments. We must realize that there is a wider concept of security, which deals also with threats that stem from failures in development, environmental degradation, excessive population growth and movement, and lack of progress towards democracy. Only with such a wider concept of security can we find ways of securing a lasting world peace.

DEVELOPMENT

Disparities have grown in the 1980's within and between countries, between the South and the North, and also, very notably, among countries in the South. Though the experience of the South has been very varied, for most of these countries the 1980's was a decade of economic decline. In Africa and Latin America per capita income and investment fell drastically, severely weakening the basis for social services and human development. But even the difficult 1980's brought strong economic growth in a large part of the developing world, including the greater part of populous Asia. A number of developing countries are now major economies, whose participation is of great and growing importance to the world economy. In Europe, the differences between East and West are more obvious than ever. Transforming the societies of Eastern Europe represents a major new challenge to development. The challenge must be met. However, support for Eastern Europe must not be at the expense of cooperation with developing countries, w

hose reform efforts are no less deserving of international support. The number of the world's poor has continued to increase. Today, more than one billion people, one in every five human beings, live in utter poverty. Every day, 40 000 children die unnecessary deaths. This decade will witness the birth of the largest generation in the history of the planet with some 1.5 billion children being born. They must not be denied their right to a life in dignity. Despite all efforts, only a few of the crisis struck countries have succeeded in anything but halting the decline. The means have often been inadequate to back the will to implement reform. In many places, people see little hope for the future. Migration has, therefore, increased. Some people have moved because poverty, environmental degradation, oppression or violence have forced them. Some have moved because their aspirations to a better life, a life in which they can make better use of their capabilities, leads them to seek other places to live and work.

Migration has become an increasingly important aspect of international relations from economic and security viewpoints, and from a humanitarian viewpoint. At moderate levels, migration is an economically and culturally benign phenomenon. But poverty driven migration and refugee crises are not. The world is seeing more of that, which strains the economic and political situations in many regions. Narcotics and AIDS also bear witness to the heightened interdependencies between all nations. No country can cope on its own with these terrible scourges, directed in particular to their young generations. The drug problem binds producing and consuming nations, charging them jointly to deal with this corrupting trade. With the economic and social legacy of the 1980's, there is a great risk that many poorer countries will be marginalized, finding it more and more difficult to catch on to the rapid developments in the world economy. And there is the danger that poor people within nations will become even more margina

lized than they are today, caught ever more firmly in the vicious circles of poverty. This is an outrage to morality and a direct threat to security everywhere. The many failures of the 1980's must, however, not prevent us from recognizing a contrasting but important fact the underlying and growing potential for development. Taking the longer perspective, the progress of some parts of the developing world has been forceful and strong. Health and education has improved life expectancy at birth rose from 46 years in 1960 to 62 years in 1987, and literacy rates rose from 43 per cent to 60 per cent. This has strengthened human capabilities and potential. Economic growth for the developing world as a whole has also been strong over the decades, and indeed more rapid than that experienced by the industrialized countries during their long period of industrialization. On average, per capita consumption has grown by about 7() per cent since 1965. Developing country trade has grown considerably as a share of world

trade, as has the share of manufactures in their exports. There is thus no doubt, despite the many dismal aspects of the 1980's, that there is a dynamism in development. Where countries have managed to create effective development policies in their broadest sense, there has been strong development. There is therefore no cause for disillusion over the longer term. Development is possible, and developing countries will certainly come to play a more important role in determining the future of the world.

Focus on Poverty

International cooperation for development has left a large body of experience. Lessons have been learned, both from mistakes and achievements. In fact, we believe that a broad understanding of the basic elements of an effective and sustainable strategy is now emerging. Central to this strategy is the creation of an environment which enables people to exploit and expand their capabilities to the furthest extent possible the essence of self reliant development. This requires policies setting up a conducive economic framework macro economic order and market economic freedom. Equally, it requires policies for an equitable distribution of assets and income, as well as policies promoting an enabling environment, i.e. the provision of social services, investments in physical infrastructure, and, so important, the development of indigenous institutional capacity. There is not one single blueprint to be used all nations are unique. And there are no easy solutions in all countries difficult political choices h

ave to be made. Conflicting interests of various groups is a reality everywhere. In some countries, vested interests in an unjust system must be overcome by tough political decisions. Democratic reforms should enable a stronger civil society to develop, and with it the broad institutional basis for a just development strategy to be realized. In 1990, two of the most important international organizations, the UNDP and the World Bank, presented comprehensive and explicit studies dealing with the basics of development, how to overcome poverty and achieve human development. In UNDP's "Human Development Report 1990", countries' varying degrees of progress in enabling their populations to live better and richer lives were examined. The great disparities among countries between the level of income and the level of human development were exposed. The analysis brought out clearly the possibility of rapid progress in human development. The access to economic resources is important, but more important still are the pol

itical choices on what kind of development. Policies for economic growth are necessary, but equally crucial are the policies for social development. Human development is a concept combining people's participation, poverty eradication and human rights. Only national choice can make it happen. In the 1990 "World Development Report", the World Bank made a very thorough review of the experience in overcoming poverty. Its message was equally clear: a poverty oriented strategy needs to be two fold. Policies should promote the productive use of the poor's most abundant asset labour by harnessing market incentives, social and political institutions, infrastructure, and technology to that end. Policies are also needed to provide basic social services to the poor, especially primary health care, family planning, nutrition and primary education. Strengthening the role and rights of women is essential to any peopleoriented development strategy. The status and rights of women do not correspond to their real economic,

social and cultural role. Their disadvantaged situation, even their exploitation, varies and takes different forms in different parts of the world. One of the most cruel expressions of this is the outrageously high mortality rates for girls in parts of Asia. The clearer recognition of these issues must lead to political backing for real change. Failing this, poverty policies will not succeed. We support the emerging broader understanding of the basic elements of an effective and sustainable development strategy. Economic growth and social development are equally important factors. In particular, we urge nations to pursue policies that promote the productive employment of the poor, and to significantly increase the priority given to education.

We propose that the world community sets the goal to eradicate extreme poverty within the coming 25 years, through a committed effort to achieve sustainable development.

At present one billion people in the world one in every five human beings are defined as living in extreme, or absolute, poverty. Their living conditions do not meet even minimal standards as regards health, education and material welfare. Focussing on this one billion, the World Bank has judged it a realistic target to reduce their number by at least 400 million by the end of this decade. We submit that it is also an entirely feasible task to eliminate their number in another IS years. This requires an ambitious commitment by developing countries, and increased support from their partners. The principal policy elements needed are well known and the financial resources within reach. In order for poverty to be reduced, significant progress has to be made in social development. Many targets have been set by the United Nations organizations and adopted by the world's nations.

We propose that the following targets for the year 2000 be emphasized and that countries' achievements be monitored closely: primary education for all children,

equal participation of boys and girls in schools,

reduction of child mortality by at least one third,

- reduction in maternal mortality by one half.

By regularly monitoring the fulfilment of these targets in each country, the UN organizations and the World Bank can make a significant contribution in building the necessary commitment and in suggesting what further steps need to be taken. These and a few other central targets for human oriented development are estimated to cost about $ 20 billion a year more. A strong commitment to reduce poverty should be supported by increased aid. With a people centred development strategy, developing countries can succeed in achieving the targets. Our children shall live in a world without poverty.

A Conducive International Environment

In making development possible, the international economic environment has a huge impact. Despite sustained growth in the industrialized countries, the 1980's saw a worsening economic environment for developing countries. Increasing protectionism, falling commodity prices, volatile exchange rates and high interest rates are parts of an environment that was shaped outside of the influence of the developing countries. This contributed in precipitating the debt crisis, and the ensuing severe reduction in net capital flows that the developing world has experienced. In addition, aid levels have stagnated, at best, during the course of the decade. It is now essential to create a more conducive environment through improved international economic cooperation and increased development assistance. Action is needed on many fronts, and is discussed in many international organizations. We have chosen to bring out three areas as being of particular importance: trade, financial flows and debt reduction, and development coo

peration. | The protectionism of industrial nations is today costing the developI ing countries much more than they receive in aid. The potential annual I gains of fully liberalized world trade in two areas, agriculture and textiles, have been estimated at 100 billion and 50 billion dollars, respectively. Together this is about three times the annual amount of development assistance provided by the industrial countries. A successful completion of GATT's Uruguay Round is essential to the future trading prospects of the whole world, and in particular to the developing countries.

We propose a strengthening of the multilateral framework of trade related agreements, reducing protectionism on all fronts, and expanding opportunities for developing countries' participation in world trade.

The massive net outflow of debt related resources from the developing world must be halted. The present outflows are not sustainable. At the beginning of the I980's there was an annual net transfer of $ 50 billion to the developing world. At the end of the decade, $ 50 billion were flowing out of it, every year. This outflow can only be reversed by conducive economic policies, in the North as well as in the South. The North should pursue policies that increase saving and agree on mechanisms that encourage investments in the South. The South should pursue policies that induce confidence in their economies, facilitate development of their private sectors, attract foreign investment and curb capital flight. The debilitating and demoralizing debt overhang must now also be attacked. Debt reduction has, after a long and costly delay, been approved as part of the international debt strategy. Severely debt burdened low income and middle income countries have different debt burdens and different debt structures. The

extent and kind of debt relief will therefore differ from country to country. As many debt distressed countries are implementing stronger economic recovery programmes, the argument for increased debt and debt service reduction is only stronger, especially for the low income countries. A debt strategy that leads to effective reduction of the debt stock and takes account of the capacity of debtor countries to generate export earnings is urgently needed.

We propose a strengthened debt strategy, introducing a strong element of debt forgiveness to radically cut the debt overhang: by terms and conditions in Paris Club reschedulings that go far beyond today's in providing relief and applying to a broader range of countries, by commercial debt restructuring that better corresponds to the secondary market value of that debt, by increased financing on appropriate terms by the international rmancial institutions.

Even with a strengthened debt strategy, resource flows to developing countries will take time to recover to significantly higher levels. At the same time competition for scarce capital will increase as countries in East and Central Europe proceed with their economic reforms. However, an economically more dynamic Eastern Europe will increase world trade, to the benefit also of the developing countries in the South. In the short run, this competition for funds may be a significant problem. Therefore, the transfer of capital and technology to the South needs to be assisted by improving available financing mechanisms for investments. For a large number of the poorer nations, development assistance will continue to be an important, even a major source of foreign capital. In these countries and also in a large group of more advanced developing countries development assistance has the further purpose of being an important source for technical assistance, for the transfer of knowledge, competence and technology. Als

o, assistance for humanitarian purposes will still be needed in many situations. International coordination of foreign aid, and the surveillance of its quality, has improved markedly. The substantial increase in quick disbursing aid to the debt distressed countries of Africa that has been mobilized from donors in the framework of the World Bank coordinated Special Programme of Assistance is a considerable achievement. At a time when development assistance must be raised, the donor countries, after several years of strong growth, find it difficult to increase their aid levels, let alone live up to their commitment of providing at least 0.7 per cent of their GNP. There are some notable exceptions, but the rich world's aid efforts are now down to a record low of 0.33 per cent. The peace dividend should make it possible to reach and even surpass the 0.7 per cent target. We have international institutions to effectively make use of increased capital for development. In fact, now is the time to significantly raise

the target for international development cooperation.

We propose that all industrialized nations set public time targets to provide one per cent of their GNP for international development cooperation.

New targets are well justified when taking into account the new challenges to development and cooperation, the need for economic growth and social development and for the protection of the environment. The industrial countries bear a great responsibility for the world economic environment. We acknowledge that the OECD countries have taken strong measures in coordinating their economic and financial policies in various ways. However, shortsightedness in the economic policies of the industrial countries must not be allowed to constrain the prospects for the efforts of developing countries. From a global viewpoint, saving in the North is too low for an efficient use of world resources. The persistent imbalances in world trade and payments, and the difficulties many industrial countries have in pursuing responsible economic policies, are constant risk factors for the international finance markets, and a contributing factor to the high level of global interest rates. There is a need for global economic accountabi

lity. Seeing to the global good, surveillance by the IMF and other international bodies should be strengthened. It should be possible to suggest adjustment policies to all nations regardless of their individual economic power, and also to expect that they be followed. This is a crucial challenge to the North. We now have to adapt our attitudes and institutions to these new perceptions. Specifically, at Security Council level in the United Nations development must be accepted as an integral part of the mandate of ensuring peace and security. We are passing from a world of separate worlds to one inseparable humanity to one world. Member countries of the Security Council should give a lead in taking on to their agenda issues now so inescapably linked to the peace of the world and the security of its people as poverty and economic and ecological interdependence.