The New Context of International Economic Cooperation

261. The Heads of State or Government acknowledged the dramatic changes underway in the global economy through the deepening and widening processes of globalisation and liberalisation. They noted that the global economy continues to be characterised by rapid growth in flows of trade, finance, information and technology, which has led to increased interdependence among countries. They also recognised that countries interact with the global economy from vastly different levels of development and that, accordingly, the impact of globalisation and liberalisation is highly uneven. They stressed that while the current trend was expected to lead to increasing economic opportunity for developing economies, it is evident that a large number of the Non-Aligned Movement Member Countries continue to be marginalised and thus unable to share the benefits of these processes. The Heads of State or Government observed that most developing countries continue to confront problems of access to markets, capital and technology, and many grapple with the institutional transformation necessary for meaningful integration into the world economy. They expressed their deep apprehension at the onset of weakening and intensifying financial crises that undermine both the progress and the prospects for development. The ability to exploit new opportunities depends on the economic, technological and institutional capacities of individual developing countries to enter the global market. In this regard, the Heads of State or Government noted with concern that the globalisation process has deepened the technological, financial and productive gap between developed and developing countries, as well as widened inequalities between the rich and the poor. Hence, they agreed that the central focus of international development efforts should be in the creation of an enabling environment where developing countries would be able to acquire the requisite capacities to successfully enter, compete and benefit from globalisation.

262. The Heads of State or Government acknowledged that the emergence of the strengthened rules-based trading system, as institutionalised in the newly-established World Trade Organisation (WTO), may facilitate positive integration of countries into the global trading system if the commitment to this objective is strengthened. In this regard, they noted with concern that LDCs, most of which are in Africa, and other developing countries remain constrained by weak supply capacities and are unable to benefit from the growth in international trade. At the same time, many developing countries, including LDCs, continue to face tariff and non-tariff barriers in industrialised country markets to their exports in sectors where they have achieved comparative and competitive advantages. They expressed grave concern that the combination of constraints on supply capacity and persistent restrictions to access to large industrial markets has resulted in a situation where many developing countries' share of international trade continues to decline.

263. The Heads of State or Government welcomed the first ever special meeting of the United Nations Economic and Social Council (ECOSOC) with the participation of the Bretton Woods Institutions held in New York on 18 April 1998 and encouraged the holding of such high-level meetings on a regular basis. They welcomed the United Nations General Assembly's decision to hold the first two-day high level dialogue in September 1998 on the theme of the social and economic impact of globalisation and interdependence and their policy implications. They further encouraged both developed and developing countries to actively engage in such dialogue in the spirit of genuine partnership with a view to reaching a meaningful and successful conclusion and strengthening international and economic co-operation for development.

264. The Heads of State or Government noted with concern the growing marginalisation of the Least Developed Countries in world trade, with their total export continuing to be under 0.4% of global exports. The prospect of their losing out further had considerably increased with ongoing globalisation. In particular, the Least Developed Countries had encountered this process with a distinct disadvantage. They therefore urged all countries, particularly the developed ones, to co-ordinate and implement strategies so that the products from all least developed countries gained easy and preferential access to external markets.

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265. The Heads of State or Government noted that high growth in some developing countries was contributing significantly to the locomotive forces of world economic growth and thus the process of global integration of developing countries was paying dividends to the industrialised countries as well. In recent years, the economic growth of developing countries had continued to outpace that of developed countries as a whole. It was, however, regrettable that the voice of developing countries in decision-making still did not realistically reflect their emergence as important actors in the world economy. They urged developed countries to give this cumulative contribution and role meaningful and commensurate recognition. The participation of developing countries in global economic decision-making, particularly in the international financial institutions, as well as in trade and other economic areas, should thus be enhanced. They reiterated the need for such democratisation and transparency in international economic and financial decision making in all fora and at all levels, with the full participation of developing countries so as to ensure that their development interests would be fully taken into account.

266. The Heads of State or Government reaffirmed the need to establish an open, rule-based, accountable, predictable, just, equitable, comprehensive, development oriented and non-discriminatory global system of economic relations, especially at a time when developing countries are actively engaged in the process of liberalisation and integration into the global economy. They therefore reaffirmed that there is no alternative other than a constructive dialogue between developed and developing countries. Such a dialogue should be based on common interests, mutual benefits, genuine interdependence and shared responsibilities.

267. The Heads of State or Government reaffirmed that low wages and environmental standards in developing countries were not responsible for the loss of jobs in developed countries. Developed countries should address their unemployment problems through the implementation of appropriate macro-economic and structural policies. The problem of unemployment would not be solved by protectionism. However, while developing countries were committed to promoting all relevant labour standards, they rejected their use for protectionist purposes. They urged the developed countries to undertake necessary structural adjustments and refrain from protectionist tendencies against competitive imports from developing countries and against FDI outflows to them, in the interest of new growth opportunities.

268. The Heads of State or Government affirmed that the ILO is the only international body competent to set and deal with labour standards. They reaffirmed that the most urgent task before the ILO is to promote social justice through the creation of employment in the developing countries, thereby ensuring the greatest good of the greatest number of workers in all parts of the world, particularly in the developing countries. They reiterated that there is no linkage between trade and labour standards and rejected all attempts to establish such a linkage as well as the use of labour standards as a pretext for unilateral actions in the field of trade. They reaffirmed that efforts to link trade with labour standards obstructed the attainment of the objectives for which the ILO was created and rendered the implementation of values and principles of the ILO more difficult.

269. The Heads of State or Government were concerned about the implications of the developed countries favouring certain economies in the North and trading blocs, while many of the countries of the Movement continue to be burdened by economic stagnation and social backwardness. They stressed the need for developing countries to seize the initiative by placing on the multilateral agenda issues that are of particular interest to them. They agreed to the need for developing countries to become more pro-active in devising a positive WTO multilateral agenda that will address their pressing and unique socio-economic needs.

270. The Heads of State or Government noted that the above will require greater co-ordination among the developing countries to enhance their capacity for action and approach new problems with an integrated vision. The Movement, while subscribing to the values of environmental protection, labour standards, intellectual property protection, sound macro-economic management and promotion and protection of human rights, rejects all attempts to use these issues as conditionalities and pretexts for restricting market access or aid and technology flows to developing countries.

271. The Heads of State or Government emphasised that the achievement of the objectives of the Non-Aligned Movement of poverty eradication, economic and social progress, sustained economic growth and sustainable development, depended on a more favourable and dynamic international economic environment and revitalised international development co-operation supportive of developing countries' efforts.

272. The Heads of State or Government welcomed the significant and far-reaching reforms undertaken by the United Nations especially during the 52nd Session of the General Assembly. Mindful of the United Nation's developmental role, they stressed the need to provide to the United Nations timely and adequate resources for the fulfilment of its mandate in the economic and social fields. They also called for the reform of the Bretton Woods institutions and the WTO to enhance their efficiency in meeting global challenges.

273. The Heads of State or Government noted the decision by Ministers at the Second WTO Ministerial held in Geneva in 1998 to work towards improving coherence in international economic policy-making, while avoiding the imposition on Governments of cross-conditionality or additional conditions, with a view to maximising the contribution that an open, rule-based trading system can make to fostering stable growth for economies at all levels of development. In the case of LDCs, the Heads of State or Government reiterated the call by Ministers at the Second Ministerial that WTO members, in co-operation with the WTO Secretariat and other agencies, implement the Integrated Plan of Action for the Least Developed Countries which had been agreed to at the First WTO Ministerial, in Singapore in 1996, and taken forward at the High-Level Meeting on Least Developed Countries held in Geneva, October 1997.

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Agenda for Development

274. The Heads of State or Government urged that the role of the United Nations in promoting international economic co-operation for development be strengthened. They reiterated their support for United Nations bodies, programmes, funds and specialised agencies which served the developmental objectives of developing countries. They stressed that in strengthening the role of the United Nations in development there was a need to preserve and reinforce the distinctive and separate role and identity of the operational Funds and Programmes. They welcomed the Integrated Framework for Trade-Related Technical Assistance, including for Human and International Capacity Building, to support Least-Developed Countries in their trade and trade-related activity endorsed by the High Level Meeting on Integrated Initiatives for Least-Developed Countries' Trade and Development, held in Geneva from 27-28 October 1997. They urged that these initiatives be implemented to integrate Least-Developed Countries into the global economic system under the WTO.

275. The Heads of State or Government emphasised the importance of UNCTAD as the focal point within the United Nations for the integrated treatment of development and interrelated issues in the areas of commodities, trade, finance, technology, investment and sustainable development. They highlighted the role of UNCTAD in assisting developing countries to integrate themselves into the world economy and in building a development perspective within ongoing and future trade negotiations. In this respect, they recalled the Midrand Declaration and, while looking forward to the consolidation of UNCTAD's reforms, stressed the role of UNCTAD in operating the International Trade Centre (ITC). They emphasised the essential restoration of the Centre's current budgetary and administrative arrangements.

276. The Heads of State or Government expressed concern at the continuing decline in the availability of core resources to the United Nations Funds and Programmes, especially the UNDP. They noted with satisfaction the growing number of programme countries which contributed to enhance core resources of the United Nations Funds and Programmes, despite constraints, and stressed the need for donor countries to substantially increase their voluntary contributions to these resources. They also urged the United Nations Funds and Programmes to utilise the available resources for the essential priorities of the developing countries, which remained eradication of poverty and sustained economic growth and sustainable development. They stressed the central role of the United Nations in promoting international co-operation for development and facilitating an international economic environment conducive to development, and called for this to be strengthened. They called on the United Nations system to support the developmental objectives of developing countries through greater emphasis on technical assistance. They also urged the United Nations Funds and Programmes to enhance the utilisation of available resources for the essential priorities of the developing countries for eradication of poverty and sustained economic growth and sustainable development, including through increased provision of technical assistance.

277. The Heads of States or Government expressed their concern for the evident lack of political will by the developed countries to revitalise international co-operation for development. In this sense, they expressed their deep concern at the reduction in official development assistance and called on the developed countries to ensure the fulfilment of their commitment to meet the United Nations target of 0.7% of the GNP as official development assistance for the developing countries and also to ensure that within that target 0.15% to 0.2% of GNP be earmarked for the least developed countries.

278. The Heads of State or Government underlined the need for strong political commitment by the international community for the successful implementation of the Agenda for Development. They also stressed the importance of mobilising adequate resources for its implementation so that it can contribute effectively to diminishing existing imbalances and guarantee sustained economic growth in the developing countries. To ensure the effective implementation of the Agenda, they urged that the follow-up and assessment mechanism of the Agenda be seriously undertaken by the General Assembly. They also stressed the importance of dialogue on strengthening international co-operation for development through partnership based on the mutuality of interests and benefits, shared responsibilities and genuine interdependence.

279. The Agenda must also pay due attention to the human being, the improvement of the quality of life, the eradication of hunger, disease, illiteracy, overcrowding and unemployment. Based on the results of the World Summit for Social Development, the Agenda should reflect the practical measures required to eradicate poverty, the fulfilment of basic needs and the generation of employment. They emphasise that the improvement of education and the status of women were equally essential for development.

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280. The Heads of State or Government underlined the need to hold a high level international conference on financing for development. In this context, they noted the process launched by United Nations General Assembly Resolution 52/179. They stressed that an international conference on financing for development should be held no later than the year 2001.

281. The Heads of State or Government welcomed the adoption of United Nations General Assembly resolution 52/179, paving the way for a preparatory process for high-level, international, intergovernmental consideration on financing for development. They reiterated that finance for development was crucial for developing countries and that consideration of this issue should build on existing processes and commitments, review of institutional and other mechanisms and address the new challenges arising both from the growing significance of new stakeholders and the dynamics of globalisation and liberalisation. They believed that there was an objective need for and an acknowledged interest to the entire international community to engage in a thorough study of the underlying global causes of the current financial crisis as well as on how best to safeguard against future occurrences. They noted that the process launched by the adoption of resolution 52/179 provided the international community with the historic opportunity to enable the United Nations to discharge its responsibilities in the area of development, as envisaged under the Charter.

282. The Heads of State or Government underlined that in the area of development assistance, it was imperative that new and additional financial resources be provided by developed countries, and that technology be transferred on preferential and concessional terms to developing countries, if the consensus built in the recent series of United Nations international conferences and other consensus agreements were to be kept.

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International Trade and Commodities

283. The Heads of State or Government noted that this year marks 50 years of the multilateral trading system, and although the international community has reason to celebrate the progress that has been made towards the establishment and consolidation of the multilateral trading system, however, much more remains to be done to ensure that the global trading regime is truly equitable, benefiting developing and developed countries alike. In this regard, the strengthening of special and differential treatment for developing countries, removal of market access barriers, in developed countries, against the exports of developing countries, and full implementation of commitments in areas of particular interest to developing countries, such as textiles and agriculture, are some of the measures that need to be taken urgently. In support of this, they proposed the timely phasing out of restrictive quotas under the Agreement on Textiles and Clothing. These measures need to be accompanied by an unequivocal commitment that non-trade issues as social issues, will not be introduced in the agenda of the WTO.

284. The Heads of State or Government stressed that in a considerable number of crucial areas the negotiated results of the Uruguay Round fell short of the expectations of the developing countries. They regretted that the implementation of the Uruguay Round in areas of export interest to developing countries has been inadequate and tardy. Trading opportunities of developing countries were neutralised by the use of protectionist measures by developed countries, including those taken unilaterally and in the guise of technical standards, environmental, social, or human rights-related concerns. They agreed that developing countries should consult closely while formulating their positions on the issues being addressed by the World Trade Organisation. In this regard they urged developing countries to work together to elaborate a forward looking agenda in the framework of multilateral trade negotiations which would incorporate issues of concern to the developing countries, and would thereby enable them to take the initiative in such negotiations. They therefore reaffirmed the full implementation of the Uruguay Round agreements and to that end, urged developed countries and the WTO to provide technical assistance to enable them to carry out their commitments.

285. The Heads of State or Government declared that the World Trade Organisation should contribute to realising and expanding an open, predictable, equitable, non-discriminatory and secure multilateral trading system, based on clear and transparent procedures as well as the protection of the rights and interests of the developing countries. They considered, furthermore, that it must be governed by principles of universality in its deliberations and equity with regard to participation and preferential and differential treatment for developing countries. It is also of primary importance that its relationship with the United Nations system be defined at the earliest, including the co-ordination mechanisms between both institutions. Pursuant to the 1996 Singapore Ministerial Declaration, they noted the progress made in defining the WTO's relationship with UNCTAD, including the co-ordination mechanisms between both institutions, which should be further strengthened.

286. The Heads of State or Government expressed serious concern over the disturbing tendencies of developed countries to link further liberalisation in agreed upon areas with concessions to liberalise areas of interest to them. They emphasised that for the success of the multilateral trading system, and for equitable benefits for all, it was essential to ensure the full and faithful implementation of the existing multilateral agreements. They also noted the decision by the Second WTO Ministerial Meeting to establish a process to agree on a work programme that should respond to the particular interests and concerns of developing countries.

287. The Heads of State or Government urged the developed countries to:

• Urgently implement the Uruguay Round Agreements, especially in areas of export interest to developing countries, including the agricultural, textile and clothing sectors, and decisions and measures in favour of least developed countries, as provided for in the Marrakesh Ministerial Declaration.
• Provide preferential market access through improved and strengthened GSP and other preferential schemes, and extension of their scope to cover new areas and sectors now in the World Trade Organisation.
• Refrain from introducing extraneous issues into the agenda of the WTO, particularly issues with no direct relevance to trade.
• Assist developing countries to take advantage of new trading opportunities and address difficulties faced by them in major markets and trade in services, such as tariff peaks, preference erosion, tariff escalation and the multiplication as well as misuse of anti-dumping measures and countervailing duties.
• Ensure that the international trading system fully reflected the development perspective by ensuring implementation of the provisions for special and differential treatment for developing countries.
• Ensure the participation of developing countries in standard and quality setting.
• Implement TRIPS commitments related to the provision of technical assistance to developing countries.
• Provide greater concessions for the implementation of WTO agreements by the developing countries.
• Promote a more flexible access to developing countries' trade organisations to the WTO markets information.

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288. The Heads of State or Government invited preference-giving countries to continue to improve, renew and widen the scope of coverage of their Generalised System of Preferences (GSP) schemes in keeping with the post-Uruguay Round trading system and with the objective of integrating developing countries, especially the least developed countries, into the international trading system, and stressed that ways and means should be found to ensure more effective utilisation of those schemes, particularly by the least developed countries. They stressed their opposition to the use of GSP as a tool of coercion. They also stressed that it was essential to enhance the GSP with the aim of significantly promoting certainty, stability and predictability in market access for developing countries' exports. They agreed that there was an urgent need for improving the GSP schemes deepening the preferences and widening the coverage of products of interest to developing countries, and the establishment of objective criteria for graduation. They called for the granting of duty-free market access to the Least Developed Countries as a matter of urgency.

289. The Head of State or Government welcomed the offer by the Government of Thailand to host the tenth session of UNCTAD in Bangkok in the year 2000. They looked forward to UNCTAD X as a means towards strengthening the mandate and role of UNCTAD on trade and development and providing important policy directions to advance global partnership for economic co-operation for the next millennium. They committed themselves to launching a successful process of preparation for UNCTAD X.

290. The Heads of State or Government called upon UNCTAD to play an active role in the following broad areas:

(a) providing objective and in-depth analyses of the effects of liberalisation and of any proposals for further liberalisation,
(b) strengthening the capacity of developing countries to participate in trade negotiations,
(c) strengthening the supply capacity of developing countries especially the LDCs in order to ensure that these countries are able to benefit from the opportunities that may be created as a result of liberalisation,
(d) make recommendations to promote coherence between global economic policies so that the ability of the developing countries to benefit from increasing trade is not compromised by imperfections in financial markets, and
(e) to examine and make recommendations to ensure that structural factors such as debt, inadequate concessional development finance and restrictions on the transfer of technology do not impede the developing countries from availing the opportunities presented by the Multilateral Trading System.

291. The Heads of State or Government welcomed the discussion taken by the Second WTO Ministerial Conference which recognised the risk of marginalisation of least developed countries and small economies. In this respect, they proposed that the specificities and needs of small States be taken into account, bearing in mind their remoteness, diseconomies of scale, lack of natural resource endowment, lack of resilience of their economies, limitation of their domestic markets and capacity for mobilising domestic savings, disadvantages in attracting foreign direct investment, vulnerability and fragility of their economies. In this regard, they strongly recommend that, in the preparation of the Third WTO Ministerial Conference scheduled in 1999 in the United States, consideration be given for the adoption of a Programme of Action in favour of small economies with a view to facilitating their integration into the world trading system.

292. The Heads of State or Government condemned persistence by certain states in intensifying unilateral coercive measures and exercise of domestic legislation with extraterritorial effects against developing countries. Such actions include blockades, embargoes and freezing of assets with the purpose of preventing these countries from exercising the right to fully determine their political, economic and social system and freely expand their international trade. They further stressed the need to contribute more effectively to increase the role of developing countries in the international economic system and the need to equal and non-discriminatory rights of all countries to join the international trading system and the necessity to keep the World Trade Organisation and its membership procedure non-political and economic-oriented.

293. The Heads of State or Government expressed their concern at the increased recourse by the major trading countries to actions, such as extraterritorial measures, that are incompatible and in conflict with international rules and regulations agreed upon in the WTO. They were further concerned at the unjustified and excessive use of anti-dumping measures to the detriment of the trade of developing countries.

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294. The Heads of State or Government condemned the present trend geared at strengthening coercive economic measures on developing countries and reaffirmed that no state may use or encourage the use of economic, political or any other type of measures to coerce another state, including non-extension of MFN status. They also rejected the expansion of such trends, and called upon states applying unilateral coercive measures to put an immediate end to those measures.

295. The Heads of State or Government expressed concern about the adverse effects of the use of coercive economic measures on the economy and development efforts of developing countries and noted that such measures had a wide negative impact on international economic co-operation and on world-wide efforts to move towards a non-discriminatory and open trading system.

296. The Heads of State or Government stressed the need to preserve and widen the preferences received by a significant group of developing countries under the Lom‚ Convention and other such agreements recognised by the WTO.

297. The Heads of State or Government reaffirmed the importance of commodities in a large number of the countries of the South who overwhelmingly depend on commodities and raw material. The share of these commodities in their Gross Domestic Product (GDP) and export earnings largely conditioned not only their other economic growth and development but also their ability to service their respective international debt obligations.

298. The Heads of State or Government stressed the need to equal and non discriminatory right of all countries to join the international trading system and the necessity to guaranty the Universality of WTO and its membership procedure thus excluding political and non-economic conditionalities or obstacles.

299. The Heads of State or Government observed that developments related to the World Trade Organisation (WTO) had brought little or no tangible benefits to the countries of the South because of the lukewarm treatment given to commodity issues. On average the overall benefits to the North had tended to be much steeper than was the case for the developing countries of the South. Over and above this, the escalation of tariffs had also lessened prospects for the countries of the South, given the removal of preferential margins earlier enjoyed under the former Generalised System of Preferences (GSP).

300. The Heads of State or Government therefore underscored the need to focus more attention on commodities and extend the range of commodities traded. They called upon the international community to support the efforts of developing countries to improve the production, processing, product diversification, marketing, distribution and transportation of commodities, and to facilitate the exploitation of opportunities resulting from advances in science and technology. They agreed to strengthen the role of the Common Fund for Commodities in line with the Five Year Action Plan (1998 - 2003) adopted at the Ninth Annual Session of the Common Fund in Bali, Indonesia.

301. The Heads of State or Government committed themselves to strengthening international co-operation in the field of commodities. They called upon the international community to support the efforts of the developing countries to improve the processing, marketing, distribution and transportation of commodities and in this regard to take advantage of new advances in science and technology. They also called on the developed countries to improve access to their markets through the lifting of tariff and non-tariff barriers and the abolition of subsidies that obstructed commodity exports of developing countries.

302. The Heads of State or Government expressed their profound concern over the continued decline of agricultural products in the international trade system and urged the developed countries to refrain from new and hidden protectionism against the agricultural products of the developing countries.

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Financial, Investment and Monetary Issues

303. The Heads of State or Government stressed that aid could not be replaced by foreign direct investment, which so far had been restricted to a handful of developing countries. Indeed, the flow of aid was required for the creation of conditions in developing countries, particularly the least developed, which would enable them to invest in their infrastructure and make the investment climate more favourable to foreign entrepreneurs.

304. The Heads of State or Government emphasised the considerable importance of Foreign Direct Investment (FDI) for the development of their respective countries, promotion of transfer of technology, including environmentally sound and safe technologies, building up of endogenous capacities and generation of employment. They attached particular importance to FDI inflows in the infrastructure and manufacturing sectors. They noted that Non-Aligned Movement countries had taken several steps to create a climate conducive to FDI inflows. They called upon major industrialised countries to take complementary steps so that the actions undertaken by the developing countries could have maximum impact and prevent their marginalisation in the global economy. They also noted that the extent and spread of FDI inflows into developing countries remained uneven. Furthermore, many developing countries were not in a position to attract sufficient FDI. They, therefore, reiterated that FDI can only complement concessional finance and cannot replace it.

305. The Heads of State or Government were of the view that the globalisation process had encouraged flows of FDI from industrialised to developing countries and highlighted the role of transnational corporations (TNC's) in economic growth. However, a concentration of these flows in some geographic areas had continued, leaving some others, in particular LDCs, without access to them and without the possibility of having the investment multiplier effect to generate the necessary developments for some important sectors. FDI had been selective, and its flows had been driven to countries where the rates of return were importantly high.

306. The Heads of State or Government noted the continued examination of the relationship between trade and investment issues by UNCTAD and the WTO. They called on UNCTAD to continue its work in identifying and analysing the implications for development of issues relevant to a possible multilateral framework on investment, taking fully into account the interest of developing countries. They stressed the need for this work to be conducted on the basis of universality and democratic participation taking into account the interests and concerns of developing countries. They also reaffirmed their commitment to actively participate in discussions on this issue, so as to promote and defend their interests.

307. The Heads of State or Government expressed their concern at the recent financial and economic crisis experienced by Asian countries. The extremely large funds moving in and out of countries with unprecedented rapidity and unpredictability as well as the massive trade in currencies for speculative purposes, had certainly contributed its share to the making of the crisis. Recognising the possible global repercussions, they underlined the need for a specific regulatory framework for the financial and exchange markets. They further recognised the essential need to ensure the transparency of the capital flows of private sectors with a view to strengthening the early warning system and improving the crisis management to mitigate the possible adverse impact of such financial crises in the future.

308. The Heads of State or Government urged UNCTAD, in collaboration with the World Bank and the International Monetary Fund, to study the abovementioned developments and to suggest measures in order to strengthen the global financial system. The international financial institutions should create and enhance mechanisms, including surveillance mechanisms, technical assistance and adequate information facilities, so as to prevent financial crises and neutralise their adverse effects, and recommend ways and means on how developing countries could implement mechanisms to discourage speculative capital flows.

309. The Heads of State or Government recalled that the Seventh Summit of the Non-Aligned Movement in 1983 called for the convening of an international conference on money and finance for development, to pursue the comprehensive reform of the existing inequitable and outdated international monetary and financial system. In this context of profound changes in the international economic environment, the Heads of State or Government also recognised the need to initiate the necessary measures to realising the convening of an international conference on international financial and monetary co-operation with a view to reforming the prevailing international monetary and financial system and meeting effectively the development and other financing requirements of the international community, particularly the developing countries.

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310. The Heads of State or Government noted the proposal by Madagascar of appropriate mechanisms of the Movement, for the development of its Members, such as a monetary fund, a commodities fund, a fund for social and economic development, in addition to the actions of the international financial institutions and the international community.

311. The Heads of State or Government called upon the Bretton Woods Institutions not to link their credit facilities with non-economic issues, particularly security matters. They emphasised that these Institutions should resist efforts by certain countries to use them to promote their narrow interests. They stated that these institutions should extend their maximum help to developing countries facing serious liquidity problems.

312. The Heads of States or Government further urged the developed countries, acting in concert with developing countries, as well as the International Monetary Fund, the World Bank and the United Nations, to accelerate the review of the world financial system with the objective of ensuring that short-term capital flows were supportive of expanding trade, employment and development. They also stressed that a review of the world financial system and the Bretton Woods Institutions should be carried out on a truly multilateral basis, and through a democratic process.

313. The Heads of State or Government, while welcoming the liberalisation of the financial sector in many developing countries, and while recognising the growing importance of finance, especially banking and securities trading, the Heads of State or Government called on developed countries and the international financial institutions to assist developing countries that undertook financial liberalisation with adequate resources to address the destabilising effects of short-term capital flows. They therefore agreed that there was a need for the existence of a multilateral surveillance mechanism, the main responsibility of which was to identify the nature, and minimise the impact of speculative flows on the developing world's financial stability and ensure the soundness of the financial system. The nature, form and mandate of such a multilateral surveillance mechanism should be the subject of universal consultations on the basis of mutuality of interests and interdependence of world economies.

314. The Heads of State or Government stressed that the International Conference on Money and Finance should go far beyond Official Development Assistance (ODA) and financial flows. It should define an international economic climate conducive to creating a model for a new international financial system capable of preventing financial crises which often threatened the sovereignty of states.

315. The Heads of State or Government declared that the implementation of the commitments adopted by various international conferences in the economic and social fields required the mobilisation of a substantial volume of new and additional resources to developing countries. It is not sufficient to rely on the shifting of priorities or reallocation of national budget and Official Development Assistance. They called upon the developed countries, that have not done so, to fulfil the commitment to allocate 0.7% of their GNP to Official Development Assistance. The Heads of State or Government reaffirmed their commitment to continue utilising aid effectively.

316. The Heads of State or Government expressed their support for the "20/20 concept" as endorsed by the World Summit for Social Development, calling for a mutual commitment between interested developed and developing country partners to allocate, on average 20% of the Official Development Assistance and 20% of the national budget, respectively, to basic social programmes. They also called on the Bretton Woods institutions to respect the "20/20 concept" in their dealings with the developing countries that have accepted the "20/20 concept".

317. The Heads of State or Government underlined the need to increase the capital base of the World Bank and the regional development banks in order to contribute more effectively to mobilising world savings and to channel them towards projects and programmes of developing countries. To this end, they also called on the creditor developed countries for an increase in IMF resources, including the allocation of new development-oriented Special Drawing Rights.

318. The Heads of State or Government noted that the content and objectives of Enhanced Structural Adjustment Facility (ESAF) should be transformed, as in their current emphasis, the issues of poverty reduction are not given much attention. Although there is empirical evidence for some of the developing countries, that economic growth improves the socio-economic conditions of the people, for most of the developing countries especially the least developed countries (LDCs), a rather poor response to adjustment highlights the fact that ESAF has not sufficiently solved the problem of poverty. This calls for the IMF and the World Bank to incorporate poverty alleviation and employment creation policies when designing the financial programmes for developing countries, which act as a framework upon which ESAF programmes are designed. They expressed concern that a large number of countries that have been performing well, using ESAF benchmarks as criteria, are still facing increasing levels of poverty and unemployment.

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External Debt

319. The Heads of State or Government stressed that the evolving debt strategy must be accompanied by a favourable and supportive international economic environment, including the full implementation of the results of the Uruguay Round of multilateral trade negotiations, and the Marrakesh Ministerial decisions in favour of the least developed countries and the nett food-importing developing countries.

320. The Heads of State or Government stressed the need for new financial flows to debtor developing countries from all sources, in addition to debt-relief measures that include debt cancellation, and urged creditor countries and multilateral financial institutions to continue to extend concessional financial assistance, particularly to the least developed countries (LDCs), in order to support the implementation of economic reforms and stabilisation and structural adjustment programmes by the developing countries that will enable them to extricate themselves from the debt overhang and attract new investment and to assist them in achieving sustained economic growth and sustainable development and the eradication of poverty. Cancellation of the debt of developing countries is a request to be addressed in particular to developed countries so that they will shoulder their responsibilities towards debt-related problems and work for the reduction or cancellation of LDCs debts. In this context, they recalled the appeals presented for the solution of the problem of external debt through, inter alia, its recycling into development priorities of the developing countries concerned.

321. The Heads of State or Government reiterated that for many developing countries, in particular LDCs, the external debt service still constituted a major factor of resources deviation, some of which could be used to alleviate such urgent needs as infrastructure, basic services, education and health. In this regard, they welcomed the initiative of the international financial institutions to support the heavily-indebted poor countries in their endeavours to resolve the external debt problem of those countries. However, they noted with concern the slow progress made in implementing the HIPC Initiative. They further encouraged early and urgent application of debt relief measures, particularly within the context of the HIPC Initiative, and committed themselves to creating the environments within their countries that were conducive to exploiting the benefits these countries would derive from relief and assistance measures. In this context, they reiterated the message conveyed by the Chair of the Movement to the Leaders of the Group of Eight on the occasion of their Summits in Lyon, Denver and Birmingham, regarding the refinement of the HIPC Initiative so that the requirement of a six-year period of structural adjustment be reduced to three, that the level of debt reduction by the Paris Club be increased from 80% to 90% and that the terms for reduction of multilateral debt be substantially eased. They also pointed out that it was important not to introduce new conditionality.

322. The Heads of State or Government called on the international community, including the United Nations system, and invited the Bretton Woods institutions, as well as the private sector, to take appropriate measures and action for the implementation of the commitments, agreements and decisions of the major United Nations conferences and summits organised since the beginning of the 1990's on developments related to the question of external debt.

323. The Heads of State or Government noted that while acknowledging the importance of the HIPC initiative, the fiscal burden of meeting debt-service payments, even after debt relief, would remain heavy for most of the least developing countries. They called upon the Bretton Woods institutions to increase HIPC debt relief so that scarce resources were released to cater for economic development and poverty alleviation.

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Industrialisation

324. The Heads of State or Government recalled the Declaration on UNIDO adopted at the XIth Summit of the Movement and stressed the continuing importance and relevance of UNIDO as the central co-ordinating agency in the UN system in the field of industrial development. They welcomed the reform process undertaken successfully by UNIDO, to enhance its effectiveness with a firm stand for supporting and promoting industrial development and for providing specialised technical services. They re-affirmed their commitment to support and strengthen UNIDO in the spirit of global partnership and mutual benefit. They underscored the need to secure the future of UNIDO as a specialised agency vital to the promotion of industrial development in developing countries in the context of the multilateral development co-operation system.

325. The Heads of State or Government reiterated the importance of industrial development for developing countries, especially those in Africa and the important role played by UNIDO in this regard. They called upon the international community including the relevant organisations and bodies of the United Nations and in particular UNIDO to support the implementation of the Programme for the Second Industrial Development Decade for Africa so as to enable African countries to intensify and expand industrial co-operation among themselves.

326. The Heads of State or Government welcomed UNIDO's new Business Plan which includes a focus on LDCs and Africa, emphasising SMME development and agro-based industries, and decentralisation by strengthening field representation to ensure greater contact with developments within countries and regions.

327. The Heads of State or Government, recognising the critical role foreign direct investment (FDI) plays in the economic growth and development process in developing countries, pledged their support for the strategic investment alliance between UNCTAD and UNIDO, to work towards enhancing the complementarities and co-ordination of their work with regard to promoting investment in developing countries.

328. The Heads of State or Government noted that many developing countries face serious constraints in their industrialisation and diversification efforts due to lack of technical, financial and human resource capacity. Such impediments undermine the development of small and medium-sized enterprises (SME's) which are important sources of employment for the vast majority in these countries. They therefore called on developed countries, multilateral institutions and donors to provide the necessary resources to assist developing and least developed countries (LDCs) in overcoming these obstacles to their industrialisation programmes.

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Food and Agriculture

329. The Heads of State or Government recognised that pressure on the natural resource base coupled with inter alia economic and social factors limit growth and development in developing countries, particularly those still dependent on agriculture as a lead sector. They reiterated the need to improve agricultural performance to ensure sustainable use and proper management of natural resources by, inter alia, adopting policies that promote sustainable agricultural technologies and practices that improve productivity. Thus, they urged Member Countries to implement comprehensive approaches to development that will take into account the existing conditions and requirements in individual countries.

330. The Heads of State or Government reaffirmed that the right to food was a fundamental human right and its promotion constitutes a moral imperative for the international community. Therefore, they emphatically rejected the use of food as an instrument of economic or political pressure.

331. The Heads of State or Government noted that in spite of the advances made by the Uruguay Round, the accords on agriculture will lead only to a partial trade liberalisation, and serious distortions will persist in the agricultural commodity markets even after their full implementation. They expressed their deep concern about the negative effects of these accords on the developing countries, particularly the Least Developed Countries and the nett food importing countries. Accordingly, they considered it necessary to undertake studies on the impact of the new multilateral trading system on food supply and its possible consequences on food security, particularly in developing countries.

332. The Heads of State or Government noted with concern that agricultural export subsidies, market price support schemes and direct payments paid by major developed countries, have had serious negative impact on prices and trade in agricultural products of developing countries. These subsidies have restricted developing country access to industrial country markets and third markets, and have limited the ability of developing countries in general and least developed countries (LDCs) in particular, to produce and export on the basis of their comparative advantage. In the circumstances, they identified their interest in developing and sustaining a vibrant rural and agricultural economy based on comparative advantages and free from these distortions. To this end, they expressed the need to address these and related issues in the next round of multilateral trade negotiations on agriculture scheduled to commence in 1999.

333. The Heads of State or Government welcomed the commitment of the WTO at its Second Ministerial Conference held in Geneva in May 1998 to continue to improve market access for products exported by the developing countries and the least-developing countries on as broad a basis as possible, and called upon developed countries to remove any distortionary measures in their agricultural policies that impact negatively on international trade in agricultural products.

334. The Heads of State or Government noted the increasing attention paid to product standards and standards for production and process methods, particularly in agricultural products, aimed at ensuring food safety in developed countries. They recognised the need to ensure that systems and processes of production and control deliver wholesome and healthy products. However, they pointed out that such technical regulations, particularly in agriculture and health, should be transparent and applied in a non-discriminatory manner, based on scientific information, research and international standards in order to ensure that they are not used for protectionist purposes and thereby create an unnecessary obstacle to legitimate international trade. To this end, the Heads of State or Government committed themselves to monitor international developments and practices in the area of technical regulations and work together in co-ordinating their efforts in this regard, in order to ensure that these measures are not used to undermine or prejudice their legitimate trade interests, particularly in those areas in which they have or are able to develop comparative advantage.

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Environment and Development

335. The Heads of State or Government recalled that the Programme for the Further Implementation of Agenda 21, includes a statement of commitment to Agenda 21 and to the goals of sustainable development; an assessment of progress made since the United Nations Conference on Environment and Development in all main areas of Agenda 21 and other outcomes of the Conference; a broad range of decisions and recommendations aimed at fostering progress in various sectoral and cross-sectoral areas of Agenda 21 and, in particular in its means of implementation; decisions aimed at strengthening global and regional institutional arrangements for achieving sustainable development; and recommendations on the future methods of work of the Commission on Sustainable Development (CSD) and the programme of work of the Commission for the period 1998 - 2002. They noted the setting up of a High Level Task Force on strengthening of UNEP and Habitat by the United Nations Secretary General and reiterated their commitment to these two bodies. They called for provision of necessary resources to enable them to strengthen their capacities for implementation, within existing mandates, including technical assistance to developing countries. In this regard, they noted the report prepared by the Task Force and called for its thorough consideration by the UN General Assembly during its Fifty-third Session.

336. The Heads of State or Government recognised that since UNCED, substantial efforts have been made by developing countries to integrate environmental, economic and social objectives into decision-making by elaborating new policies and strategies for achieving sustainable development. At the same time, they expressed their concern at the disappointing lack of fulfilment of international commitments voluntarily undertaken by industrialised countries at the Rio Earth Summit. They drew attention to the Programme for the Further Implementation of Agenda 21 agreed at the United Nations General Assembly Special Session (UNGASS) in June 1997 which, inter alia, calls for urgent fulfilment of commitments for the transfer of environmentally sound technology, including time-bound commitments, as appropriate, to developing countries.

337. The Heads of State or Government, while recognising that a number of positive results have been achieved, were deeply concerned that the overall trends with respect to sustainable development are worse today than they were in 1992, that new and additional financial resources to developing countries have not been provided, the transfer of environmentally sound technologies on favourable, concessional and preferential terms has not been realised, and that the developed countries have not assumed the principle of common but differentiated responsibilities. Hence, they emphasised that the implementation of Agenda 21 in a comprehensive manner remains vitally important and is more urgent now than ever.

338. The Heads of State or Government welcomed the First Assembly of the GEF, which was held in New Delhi, India, from 1-3 April 1998. They noted the statement by the Assembly that for the GEF to meet its deepening potential and fulfil its multiple missions, it should be a facility at the cutting edge, innovative, flexible and responsive to the needs of recipient countries, as well as a catalyst for other institutions and efforts. They welcomed the completion of the second replenishment of the core fund of the GEF. They emphasised the need for decisions of the GEF to be taken in a democratic and transparent way and for co-ordination between the implementing agencies of the Facility to be strengthened. They committed themselves to continue reinforcing the developing countries' joint participation in the activities of the GEF to safeguard their common interests, both in the orientation of its policies as well as in the financial allocation of resources.

339. The Heads of State or Government reiterated their full support to UNEP and called for its strengthening as a unique international organisation entrusted with the mandate to co-ordinate the activities dealing with environmental issues and make integrated analysis of the environmental problems in order to fulfil the goal of reaching international consensus concerning the new environmental challenges.

340. The Heads of State or Government reaffirmed that economic and social development constitutes a priority and a fundamental right of countries. Sustainable development, therefore, must be considered within the wider context of sustained economic growth. States have the sovereign right to exploit their resources in accordance with their own environmental and developmental policies.

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341. The Heads of State or Government recognised that a mutually supportive balance between the international and the national environment is needed in the pursuit of sustainable development and that the gap in income between developed and developing countries points to the continued need for a dynamic and enabling international economic environment supportive of international co-operation, particularly in the fields of finance, technology transfer, debt and trade, if the momentum for the global progress towards sustained economic growth and sustainable development is to be maintained and increased.

342. The Heads of State or Government welcomed the Kyoto Protocol on legally binding commitments for the parties to the Framework Convention on Climate Change to reduce their emission of Greenhouse Gases as contained in Annex B of the Kyoto Protocol. They called on the developed countries to undertake urgent and effective steps to implement these commitments through domestic action. Emission trading for implementation of such commitments can only commence after issues relating to the principles, modalities etc. of such trading, including the initial allocations of emission entitlement on an equitable basis to all countries has been agreed upon by the Parties to the Framework Convention on Climate Change. They categorically rejected all attempts by some developed countries to link their ratification of the Kyoto Protocol with the question of participation by developing countries in the reduction of GHG emissions. They also called for immediate measures to provide the developing countries with necessary financial resources and clean technology to enable them to meet their existing commitments under the Framework convention on Climate Change, including inter alia, inventorisation of national emissions and dissemination of knowledge of climate change.

343. The Heads of State or Government urged developed countries to implement effective measures, to cope with their commitments in terms of the reduction of emissions of greenhouse gases in their own territories and highlighted the need to avoid the so-called 'flexibility mechanisms' of the Kyoto Protocol enabling those countries to elude the fulfilment of their commitments. In this connection, the launching of the Clean Development Mechanism, established in terms of the Kyoto Protocol, could bring about risk and opportunities for the sustainable development of developing countries that must be adequately addressed.

344. The Heads of State or Government noted the 10th anniversary of the Montreal Protocol on substances that deplete the ozone layer and recognised progress made towards combating ozone depletion. They acknowledged that the depletion of the ozone layer poses a serious threat to the whole world. They urged Parties to the Protocol to comply with its requirements and to phase out the production and consumption of regulated ozone depleting substances (ODS's) in accordance with the phase out schedules agreed to by countries in terms of the Protocol. They urged Parties to the Protocol to comply with its requirements, including those relating to the phasing out of the consumption of regulated ozone depleting substances, and assistance to affected producers in developing countries.

345. The Heads of State or Government endorsed the decisions adopted in the framework of the Basel Convention to ban, by the end of 1997, all transborder movements of hazardous wastes originating from member countries of the Organisation for Economic Co-operation and Development (OECD) to non-OECD countries, and called for its strict and rigorous implementation. They declared that poor countries cannot afford to be the depositories of the hazardous wastes generated by the unsustainable production and consumption patterns of the member countries of the aforementioned Organisation. They welcomed the adoption of lists giving greater clarity concerning hazardous wastes subject to the ban, at the Fourth Conference of the Parties in Malaysia in February 1998. Many countries must still ratify the ban decision preventing movement of hazardous wastes from OECD-countries to non-OECD countries and, in line with the decision adopted at the Fourth Conference of the Parties, these countries are urged to proceed with the ratification as soon as possible.

346. The Heads of State or Government emphasised the importance of biodiversity as a strategic wealth of the developing countries, on account of both its present and potential value, and agreed that its adequate management and conservation are essential for sustainable development, especially in the most important areas of national economies such as forest utilisation, agriculture, fishing, wildlife management, health, industry and tourism.

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347. The Heads of State or Government emphasised the importance of technology applied to biodiversity as a necessary means of securing the benefits from productivity increases in agriculture or from new and better products so that they constitute a source of economic and food security for future generations. They considered it essential to develop an appropriate framework, in order to guarantee supplier countries of genetic resources, a fair and equitable participation in research and development of projects, and in the benefits and results derived from this process.

348. The Heads of State or Government recalled that the developing countries own the major proportion of the biological diversity on the planet. They further underlined that, in accordance with the Convention on Biological Diversity, technology transfer and the efforts aimed at establishing an international system for the protection of intellectual property rights, including those related to goods and processes, should guarantee an equitable distribution of benefits arising from the use of genetic resources. They also underscored that the rules and habits of local communities must be respected and incorporated into the intellectual property rights norms, and that market access should not confer a right to impose such norms.

349. The Heads of State or Government welcomed the decision of the 1997 United Nations General Assembly Special Session (UNGASS) on Agenda 21 to prevent or eliminate over-fishing through the adoption of management measures and mechanisms to ensure the sustainable management and utilisation of fishery resources. They called upon the developing countries to participate actively in the Code of Conduct and support the elaboration by the Food and Agriculture Organisation (FAO) of the code of conduct for responsible fishing with the aim of preserving resources and managing and developing bio-aquatic resources, taking into account the preservation of ecosystems and biodiversity. They urged countries to ratify and implement the Convention relating to the Conservation and Management of Straddling Fish Stocks and the Highly Migratory Fish Stocks. They also recalled the emphasis placed on an integrated approach to the management of oceans and all seas in Chapter 17 of Agenda 21 and urged support for the improved implementation of the global program of action for the protection of the marine environment

350. The Heads of State or Government called upon States, relevant intergovernmental bodies and all others involved in the International Decade for Natural Disaster Reduction to participate actively in the financial and technical support for the Decade activities, including those related to international co-operation to reduce the impact of the El Niņo phenomenon and catastrophes such as earthquakes and floods, in order to ensure the implementation of the International Framework of Action for The Decade, in particular with a view to translating the Yokohama Strategy for a Safer World: Guidelines for Natural Disaster Prevention, Preparedness and Mitigation and its Plan of Action into concrete disaster reduction programmes and activities. They reiterated that progress in economic development would contribute to States' ability to build the infrastructure necessary for natural disaster reduction and that concessional resources, together with technology transfer, were critical to strengthen their effort in this regard. They also observed that pro-active disaster management programmes contributed positively to social and economic development, in that funds previously allocated to reactive activities became available for development. They noted that recent erratic changes in weather patterns, particularly floods, droughts, storms, had caused severe loss of life and damage to property. Some of these changes could be attributed to global warming, caused by anthropogenic emissions of greenhouse gasses (GHGs). They called upon the industrialised countries to reduce their emissions of GHGs with a view to protecting the global climate.

351. The Heads of State or Government recognised that the water issue in the world is a problem of strategic and global nature, and that the fresh water reserves in the world are constantly decreasing whereas human requirements are increasing enormously. If the situation is not redressed, acute shortages of water resources and potable water may become the cause of social upheavals and international conflicts including between Member States. In this context they believed that it is necessary for competent international organisations to intensify efforts to mobilise and generalise the use of pertinent techniques, such as aseptation of used water and desalination of sea water at competitive economic costs. In the field of international co-operation, they stressed that the issue of water should be accorded a high priority and that adequate resources should be earmarked, in accordance with Chapter 18 of Agenda 21 and Principle 8 of the 1992 Rio Declaration.

352. The Heads of State or Government took note of the efforts in recent meetings on water and development as well as the initiatives aiming at mobilising financial and technical resources in conjunction with the necessary investment efforts for development, management and sustainable use of water in the developing countries.

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353. The Heads of State or Government expressed that efforts to manage the world's ocean resources are crucial in enabling countries to attain and sustain adequate levels of development. The conservation and sustainable use of the seas depends on conditions that promote economic growth, the environment and food security. Moreover the adequate management of ocean resources offers a vital field for the adoption of joint strategies which will further the objectives of South-South co-operation and, in particular, of collective self-reliance.

354. The Heads of State or Government welcomed the convening of the First Conference of the Parties of the Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, Particularly in Africa, held in Rome, 29 September to 10 October 1997, and in supporting the IFAD, which hosts the global mechanism to fully play the principal role in collaboration with UNDP and the World Bank, invited governments, regional integration organisations and other relevant organisations to fulfil their voluntary contributions in order to bring due assistance to the Convention Secretariat and its Subsidiary Organ. They attached great importance to the problem of desertification, which has affected many parts of the world, particularly Africa. Caused by many factors such as climate variations and human activities, desertification is not merely a matter of the land degradation, it is also about the people living in drylands. The most obvious effect of the degradation of drylands is the disgrace of natural resources and low agricultural productivity which lead to widespread poverty. In this regard, the international community, and the developed countries in particular, should provide new and additional financial resources in order to enabling developing countries to combat desertification and mitigate the effect of drought, including, the poverty as the principal consequences of desertification and drought in the majority of affected countries.

355. The Heads of State or Government expressed their support for the efforts of the United Nations Conference on Trade and Development in order to promote the balance between trade and environment as mutually supportive issues that should permit the achievement of sustainable development. On the other hand, they also called on the international community to ensure that environmental policies and measures with a potential trade impact were not used for protectionist purposes.

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Science and Technology

356. The Heads of State or Government underlined that the progress of developing countries was dependent both on access to technology and their endogenous capacity to develop it. They attached special importance to environmentally sound and safe technologies and biotechnology. They expressed their grave concern at measures aimed at blocking or impeding, for political and other ends, particularly through coercive economic measures, the transfer of technology to developing countries. The controls imposed by highly industrialised countries on the export of dual-use technology and other types of sensitive technology should not be used to prevent the access of developing countries to technology for peaceful, developmental purposes.

357. The Heads of State or Government emphasised that the application of procedures to protect intellectual property rights should take into account the needs of developing countries so as not to adversely affect the financial, commercial, technological and development interests of their countries. They expressed the view that the protection of intellectual property must be complemented by actions directed at stimulating the creation of new indogenous technologies on favourable conditions.

358. The Heads of State or Government recognised the need to further support the developing countries' efforts on science and technology through, inter-alia, the multilateral financial institutions, co-operation in the development of appropriate technologies, the transfer of technology between small and medium size enterprises (SME's) in developed and developing countries, foreign direct investment flows and strengthening information systems on environmentally sound technologies.

359. The Heads of State or Government noted the work being undertaken by the Commission on Science and Technology for Development on its work programme for Member States, especially for developing countries, and reaffirmed its unique role as a functional commission of the Economic and Social Council (ECOSOC), acting as the sole intergovernmental forum for the consideration of policy matters related to science and technology. They also acknowledged its impact on development and its contribution to the formulation of recommendations and guidelines on science and technology within the United Nations system, and for advancing policy and operational recommendations as to how to implement the commitments of major United Nations conferences on the issue of access to technology and transfer of technology to developing countries. They called for the strengthening of the Commission to better discharge its role for the examination of science and technology policies and for the formulation of recommendations and guidelines on science and technology matters within the United Nations system, in relation to all development issues.

360. The Heads of State or Government expressed their profound concern over the continued inadequacy of resources for fostering science and technology for development, and the lack of political will on the part of the developed countries in fulfilling their commitments in this respect. They called on the developed countries to facilitate access of developing countries to technology that was held or owned by governments and public institutions or results from publicly-funded research and development activities.

361. The Heads of State or Government recognised the need for developing countries to have access to and full benefit from opportunities presented by the growth in information technology, particularly through the cyberspace. In this regard, they called on the developed countries to strengthen the developing countries' endogenous capacity and facilitate their access to such technology on favourable terms as well as preferential and concessional terms.

362. The Heads of State or Government emphasised the potential negative impact that the Year 2000 (or Millennium) Bug problem could have on developing country societies. They stressed the need for a joint initiative that included the sharing of information and best practices, communicating examples of projects underway and experience gained from such projects at multilateral fora, as well as making different pockets of expertise available to all countries, thus minimising the cost of dealing with the problem. They also urged every country to establish a national task team if it had not done so, in order to monitor the situation in each member country. In this regard they urged the relevant organs and organisations of the United Nations, in particular UNCTAD and the ITU, to assist developing countries to become Year 2000 compliant, in accordance with United Nations General Assembly resolution 52/233 and the ECOSOC guidelines contained in document 1998/85.

363. The Heads of State or Government also stressed the need to promote, facilitate, and finance as appropriate access to and transfer of technology, including EST, on favourable and concessional terms. They called for the facilitation of the maintenance and promotion of traditional and indigenous technologies that may have been neglected or displaced, in particular, in developing countries. They underlined that in the area of bio-genetic resources, it was imperative that rules were codified on the prevention of bio-piracy. They also underlined that such rules needed to be based on the inherent right of communities in developing countries to their indigenous bio-genetic resources and that bio-piracy was an ethical issue affecting the vital socio-economic development of developing countries. They also stressed the need to ensure that developing countries' industries were enabled to have their due share of global bio-trade.

364. The Heads of State or Government welcomed with satisfaction the continued implementation of the expanded programme of co-operation by the Centre for Science and Technology of Non-Aligned Movement Countries and called upon all Non-Aligned and other developing countries to subscribe to the Statute of the Centre and to strengthen the Centre financially.

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Information and Communication

365. The Heads of State or Government pointed out that Non-Aligned Countries should intensify the development of communication technology as a means of redressing the continued imbalances and inequalities between developed and developing countries in the field of information and communication. In this context, they reaffirmed that Member Countries should enhance the function of the Non-Aligned News Agency Pool (NANAP) and the Broadcasting Organisation of Non-Aligned Countries (BONAC) and accelerating the process of setting up the New International Information Centres decided by COMINAC V.

366. The Heads of State or Government expressed their appreciation for the efforts of the Cyprus Chairpersonship of BONAC in promoting the goals of this important organisation of the Non-Aligned Countries and accepted the offer of Colombia to assume the Chairpersonship as from June 1998.

367. The Heads of State or Government recalled the outcome of the Fifth Conference of Ministers of Information of the Non-Aligned Countries (COMINAC V) held in Abuja in September 1996, which, inter alia, agreed on the need for intensive research efforts by Non-Aligned and other developing countries in the development of communication technology and inter and intra regional co-operation through Non-Aligned Movement mechanisms geared to this end, as a means of redressing the continued imbalances and inequalities between developed and developing countries in the field of information and communication.

368. The Heads of State or Government expressed their concern over the increasing use of defamation and distortion of information by some mass media of developed countries, such as Radio Free Asia and Radio Marti, to destabilise the governments of Non-Aligned and other developing countries and called for an immediate end to such acts. They expressed their concern over the undisguised attempts of some countries to eliminate the concept of a new equitable world information and communication order and stressed that the establishment of a new world information and communication order aimed at ensuring impartiality and balance in the information glow, improving the information and communication infrastructure and capacity of the developing countries through the transfer of advanced information technology and expanding their access to information is more imperative than ever before, particularly for the maintenance of international peace and security.

369. The Heads of State or Government recognised the importance of revitalising the work of the United Nations system in the field of Information and Informatics, with a view to improving access to the full benefits of the global developments in these areas, particularly for Non-Aligned and other developing countries. In this connection, they stressed the need for closer attention by the members of the Movement, as well as by the Group of 77 and China, to the work of the Committee on Information and the Working Group on Informatics.

370. The Heads of State or Government noted with concern the observation made by the Task Force on the reorientation on the United Nations Public Information activities regarding substantial problems that some integrated United Nations Information Centres have confronted in performing their information and communications functions and requested the United Nations Secretary-General to undertake urgently a review of such Centres located in Non-Aligned and other developing countries to rectify the situation. They also emphasised that no changes in resources allocation to the Department of Communication and Public Information of the UN should be done that may impair the ability of the Department to perform its mandate work, particularly the ones in the areas of special interest to Non-Aligned and other developing countries. They also stressed the importance of ensuring objectivity and impartiality in the United Nations DPI's publications and in this regard, welcomed the adoption at the 20th Session of the Committee on Information of a resolution urging the Secretary-General to ensure that those publications maintain editorial independence, impartiality, accuracy and full consistency with the Assembly's resolutions and decisions.

371. The Heads of State or Government reaffirmed their commitment to South-South co-operation in the field of information and communication based on the principle of collective self-reliance. They recognised the profound impact that the major developments taking place in the information technology has on the economies of developing countries which will lead to further marginalisation in the globalised world economy. In this regard they noted with satisfaction the outcome of Africa TELECOM '98 and recognised the importance that such events, in particular the four yearly regional TELECOM exhibitions and forums could play in fostering South-South co-operation. They also urged all countries to support the aims and objectives enshrined in The African Connection report of Africa TELECOM '98, putting emphasis on service delivery and investment and in this manner ensuring that a large number of Non-Aligned Members on the African continent are fully integrated into the global information society.

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South-South Cooperation

372. The Heads of State or Government stressed that due to new and evolving economic, investment and institutional arrangements among major world economies, South-South co-operation should become a more dynamic part of international development co-operation and a means of ensuring the equitable participation of developing countries in the emerging global economic order. They further stressed that increasing globalisation, liberalisation and interdependence are all making this co-operation more imperative than before. Varying development experiences and know-how in developing countries, as well as similar needs and problems to be solved, offer a unique window of opportunities for greater bilateral, subregional, regional and interregional co-operation among developing countries. Furthermore, South-South Co-operation would also strengthen the harmonisation of developing countries positions in the regional and global system and will afford them a measure of collective strength.

373. The Heads of State or Government welcomed the progress accomplished by Regional Trade Agreements concluded amongst grouping of Non-Aligned and other developing countries where liberalisation has been substantial, open and supportive of wider multilateral trade, resulting in trade creation both for RTA's members and for the third countries.

374. The Heads of State or Government invited UNCTAD and the Special Unit for Technical Co-operation among Developing Countries (TCDC) of the UNDP, as well as other relevant organisations, taking into account their agreed mandates, work programmes and priorities, to jointly undertake further work on formulating concrete recommendations on the follow-up and implementation of the San Jos‚ Declaration and Plan of Action adopted by the South-South Conference on Trade, Finance and Investment.

375. The Heads of State or Government noted with satisfaction that in the past few years there has been resurgence in interest in the increased relevance and importance of South-South co-operation, as a strategy in support of the development efforts of the developing countries as a means of ensuring their equitable participation in the emerging global economic order. They emphasised the increasing importance and complementarily of economic and technical co-operation among developing countries as a means of supporting the development efforts of these countries, particularly the least developed and African countries. They also recognised the importance of resources provided by developed countries to strengthen South-South Co-operation.

376. The Heads of State or Government reiterated that South-South co-operation should be promoted through the sharing of development experiences, transfer of technology and exploiting the latent synergies and complementarities between Non-Aligned Countries and increasing FDI flows and economic co-operation among them. They expressed their conviction that South-South co-operation constituted an integral and essential part of the efforts of the developing countries to promote economic growth, technological capacities and accelerated development.

377. The Heads of State or Government noted the great efforts made by various developing countries to promote co-operation among themselves, taking advantage of the support and assistance of different international organisations. In this connection, they welcomed the effective co-operation between certain member countries with FAO financial assistance through food security programmes in recent years whereby member countries have been able to share among themselves their expertise and experiences in agricultural development and help each other raise their agricultural production capacity. They believed that such a South-South-Donor co-operation model should be further encouraged and multiplied.

378. The Heads of State or Government noted the recent meetings convened by regional, sub-regional and other groupings of developing countries such as the Group of 77 meetings and the Group of 15 Summit, which took place in Cairo from 12-15 May 1998. In this respect, they emphasised the necessity of creating an international economic environment conducive to the fulfilment of the aims and aspirations of the developing countries.

379. The Heads of State or Government also took note of the recently concluded Summit of the Economic Co-operation Organisation held in Almaty from 9-11 May 1998.

380. The Heads of State or Government strongly favoured the holding of a South-South Summit, as called for in the outcome of the South-South Conference on Trade, Investment and Finance held in San Jose‚, Costa Rica, from 13-15 January 1997. They took note of the results of the "G-77 High Level Advisory Meeting on South Summit" held in Jakarta, Indonesia, 10-11 August 1998 which among others identified possible Agenda for the Summit. They called on Member States to come forward to offer venues for holding of this Summit.

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381. The Heads of State or Government stressed the need to intensify the process of strengthening the various inter-regional dialogues and the exchange of experiences among subregional and regional economic groupings for the purposes of expanding South-South co-operation through integrating the modalities of economic and technical co-operation among developing countries. In this context, they noted the proposal to convene the "G-77 High Level Meeting on Subregional and Regional Economic Co-operation" to be held in Bali, Indonesia, 2-4 December 1998.

382. The Heads of State or Government welcomed the recent inauguration of the Non-Aligned Movement Centre for South-South Technical Co-operation in Jakarta, Indonesia by the governments of Indonesia and Brunei Darussalam. They acknowledged that the focus of its activities is on the enhancement of people centred development and capitalisation of local resources through constructive interaction amongst development actors and partnership in development. Thus, given its vast capacity to carry out various technical programmes, they called on developing and developed countries, as well as international organisations to extend support to the centre by contributing to its future programmes and activities. Furthermore they requested the Centre to co-ordinate and initiate a co-operative network with other Non-Aligned Movement Members for the implementation of their programmes of prominence.

383. The Heads of State or Government reiterated that South-South co-operation is an essential mechanism for promoting the sustainable economic self-support and in bolstering a new South-South relations by broadening and intensifying economic co-operation among the developing countries.

384. The Heads of State or Government urged a re-examination of current modalities and mechanisms for South-South co-operation by the secretariats of regional economic groupings and other relevant institutions with a view to strengthen and readapt these modalities. In the same spirit, they urged to strengthen co-ordination between the Non-Aligned Movement and the Group of 77 in order to effectively promote the interests and positions of developing countries in different multilateral economic negotiations and fora.

385. The Heads of State or Government supported the meeting held in Santiago de Chile, November 1997, organised by the Special Unit for Technical Co-operation among Developing Countries (TCDC) of the UNDP. They recognised the importance of the pivotal countries as catalytic agents for promoting the effective participation of developing countries in the emerging global economic system. They stressed the need to promote an exchange of experiences among developing countries for South-South co-operation. Pivotal countries, and any other countries, could share their capacities and experience with other developing countries in such areas as poverty eradication, agriculture, development, forestry, trade promotion, education, health, science and technology.

386. The Heads of State or Government were of the view that the challenges facing the Movement in the area of international economic co-operation would become more complex in the era of globalisation and interdependence. They considered that the challenges should be addressed appropriately to seize the opportunities that globalisation could offer. They believed in the need to review the progress achieved by the Movement as well as to develop measures and approaches to meet the challenges of the 21st century. To that end, they decided to convene the Standing Ministerial Committee for Economic Co-operation in 1999, with a view to developing suggestions and recommendations, especially on matters of particular interest to the developing countries.

387. The Heads of State or Government welcomed the entry into force of the African Economic Community (AEC) at the Inaugural Summit in Harare, Zimbabwe, in July 1997 as an important milestone in the achievement of economic emancipation of Africa. They considered the Community and its antecedent sub-regional economic organisations, namely the Economic Community of West African states (ECOWAS), the Southern African Development Community (SADC), the Monetary Union of West Africa (UMOA), the Common Market of Eastern and Southern Africa (COMESA), Arab Magreb Union (AMU), the Economic and Monetary Community for Central African States (ECCAS) and the Inter-Government Authority on Development (IGAD), as important mechanisms through which strategies and plans already identified by countries in the region could be effectively implemented to the benefit of African peoples. They therefore called on all Africa's partners in development to become more fully engaged with the countries concerned in the process of renewal and revival on which they have embarked. They reiterated that such engagement should include concrete and more determined efforts aimed at alleviating the heavy debt burden of the continent, increasing market access for African products and attracting soft loans for their development. On their part, they urged the countries in the region not to relent in their pursuit of economic growth, as well as the current strategy of deepening co-operation with other developing countries in pursuit of the same goal.

388. The Heads of State or Government expressed satisfaction at the progress made in the areas of bilateral, subregional, regional and interregional co-operation and integration in all modes of transport among developing countries. They were especially gratified by the co-operation in improving air navigation in developing countries and the movement to co-ordinate the position of developing countries in multilateral fora of the International Civil Aviation Organisation (ICAO) and the International Maritime Organisation (IMO). Considering this, they stressed the need to promote and enhance co-operation among developing countries for finding solutions to common problems in transport. They emphasised the need to effectively pursue the aims and objectives of bilateral, subregional, regional and interregional co-operation and integration arrangements of providing safe, efficient and reliable transport services, providing economically viable integrated transport networks, as well as preserving and improving viable and strategic transport services and infrastructure. Thus, they expressed strong willingness to developing better co-ordination of their efforts to advance the position and interests of developing countries within multilateral fora.

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Critical Economic Situation in Africa

389. The Heads of State or Government embraced the idea that the international community should lend concrete support to Africa's own efforts to realise the objective of the African Renaissance, which aims to place the continent at the forefront of human development and progress. They noted that whilst the international community has a crucial role to play in assisting Africa to achieve African development priorities and goals, the primary responsibility for the development of Africa lies with the Africans themselves. In this regard they welcome the growing trend in Africa towards greater regional sub-regional co-operation and integration.

390. The Heads of State or Government welcomed the improvement of economic performance in Africa in recent years. However, they expressed concern at the continuing high levels of poverty in Africa, which require the urgent attention of the international community.

391. The Heads of State or Government called on the international community to provide additional resources for the development of the social sector in Africa, in particular to alleviate the adverse consequences on the social sector of implementation of structural reform of their economies. In addition, they reiterated that the Bretton Woods institutions, especially the IMF, should combine their efforts with the United Nations system by incorporating poverty alleviation and social development policies in their economic stabilisation programmes.

392. The Heads of State or Government noted the outcome of the Mid-Term Review of the United Nations New Agenda for the Development of Africa (UNNADAF) and called upon the international community to implement the renewed commitments to ensure that the targets of UNNADAF will be reached within the time frame of the program. They noted with concern the apparent demise of the United Nations System-wide Special Initiative on Africa scarcely two years after its launch. They confirmed the validity of the priorities then identified (education, health, water security and capacity building for governance), and urged the rededication of resources to bring this initiative to fruition.

393. The Heads of State or Government re-emphasised their concern at the problems derived from human-made and natural disasters, including drought, over-flooding and desertification, which further aggravate the plight of African societies. The devastating effects of the recent El Niņo phenomenon clearly demonstrates the vulnerability of countries, particularly developing countries, to natural disasters such as drought and flood. Such disasters often affect more than one country. They called upon states to intensify co-operation among themselves in the adoption of pro-active programmes for disaster prevention, preparedness, mitigation and disaster relief.

394. The Heads of State or Government noted that despite debt rescheduling and forgiveness, African countries are still confronted with an increasing debt burden. Although the application of the Naples Terms and Highly Indebted Poor Countries (HIPC) initiative represent an encouraging step towards a solution to the problem of bilateral debt within the Paris Club, the debt of low-income African countries still remain a serious impediment to their development prospects. The situation is exacerbated by the negative flow of resources from Africa to the multilateral institutions. The continuing progressive growth in the share of multilateral debt in their total debt stock requires the establishment of adequate modalities to implement multilateral debt reduction for the benefit of indebted African countries. They further urged the multilateral monetary and financial institutions as well as bilateral creditors to establish mechanisms that would not only seek lasting and effective solutions to the problem of multilateral debt of African countries, but would also provide additional concessional resources to the concerned countries.

395. The Heads of State or Government expressed their deep concern that the socio-economic situation in Africa had remained precarious despite many efforts made by African countries, individually and collectively, to lay a solid foundation for Africa's development. In all these endeavours, African countries were guided by the principle of collective self-reliance in order to achieve self-sustaining development of their countries. In this regard they reaffirmed the importance of greater support and the provision of adequate resources by the international community to augment Africa's own efforts.

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396. In the context of globalisation and liberalisation, the Heads of State or Government noted with concern the declining Official Development Assistance to Africa and that Foreign Direct Investment flows to Africa account for a mere 2% of the total FDI inflows to the developing countries. They deplored this continued marginalisation of Africa and called for the reversal of this downward trend. In the same vein, they called on the African countries to continue to take pro-active steps to improve the climate for investments. They also called upon major industrialised countries to take complimentary steps so that the actions undertaken by the African countries could have maximum impact and prevent their marginalisation in the global economy. They reiterated that FDI can only complement concessional finance and not replace it.

397. The Heads of State or Government while acknowledging that Africa was still mainly an agricultural and pastoral continent were concerned that food and agricultural output had declined substantially since the 1960's. Consequently, most African countries had become nett food importers. The civil strife, drought, desertification and other environmental factors, inter-alia, had contributed to the decline in food production. In this connection, they called on the international community to implement the Plan of Action of the World Food Summit. They furthermore called on African countries to adopt appropriate agrarian reform measures including investment in infrastructure and the extension of rural financial intermediation with a view to ensuring food security. They also welcomed the convening of the First Conference of the Parties to the United Nations Convention to Combat Desertification in those Countries Experiencing Serious Drought and Desertification particularly those in Africa held in Rome from 29 September - 10 October 1997.

398. The Heads of State or Government concurred that development of human resources was fundamental to sustainable and equitable development. The primacy of human resources development had therefore to be maintained in all Members States' economic and social policies. In this connection, education and training were key to economic and social development and had to be adapted to the needs of societies, with an emphasis on technical, scientific and technological education, thereby ensuring that education and training were commensurate with the exigencies of the labour market. Priority focus had to be given to increasing countries' capacity to implement their human resource development plans. Human resource development had to take gender balancing into account.

399. The Heads of State or Government emphasised that industrialisation is of great importance in helping African countries to achieve the renaissance of their continent. They were of the view that industrialisation is central to structural change and transformation of their economies, the increase in income and employment as well as the diversification of their economies. They also observed that industrialisation in Africa is still at a rudimentary stage, with low technological input and high operating costs. In this regard, they called upon African governments to give priority attention to the formulation of a programme for industrial restructuring, recognising the changing world economy and the globalisation of production processes.

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Least Developed Countries

400. The Heads of State or Government called upon the developed countries to fulfil the commitment of allocating at least 0,15% of the GNP as official development assistance to the least developed countries and to endeavour to reach the target of 0,20% by the year 2000. They called upon the international community to assist LDCs in developing their respective capacities, taking the individual needs of each country into account, to maximise development assistance. They further urged the developed countries, multilateral financial institutions and other creditors to intensify their efforts for an effective, durable, and comprehensive solution of the debt crisis of LDCs. In this regard, they appealed to the developed countries to write off the debt of the LDCs.

401. The Heads of State or Government welcomed the holding of the WTO/UNCTAD High Level Meeting on Integrated Initiatives for Least Developed Countries on Trade and Development held in Geneva from 27-28 October 1997. They noted the adoption of the Integrated Framework for Trade-Related Technical Assistance, including for Human and Institutional Capacity-Building, to support LDCs in their trade and trade related activities, and welcomed the envisaged closer co-operation between the WTO and other multilateral agencies assisting least developed countries, in particular UNCTAD and ITC, as well as the IMF, World Bank and UNDP. They urged these international organisations to ensure effective co-operation amongst themselves and speedy implementation of the actions requested by LDCs. They urged the developed countries to ensure that the necessary funds were made available to these organisations to secure implementation of these proposed measures.

402. The Heads of State or Government called for the effective, full and prompt implementation of the Programme of Action for the Least Developed Countries for the 1990s, and called upon all concerned to take urgent measures to implement the recommendations of the Mid-Term Review Meeting. At the same time, they welcomed the holding of the WTO High Level Meeting on Integrated Initiatives for Least Developed Countries on Trade and Development as a first step towards halting further economic marginalisation of LDCs.

403. The Heads of State or Government called upon the international community to take concrete steps so that the exports of the LDCs are given wider and more preferential access to the markets of the developed countries, and for support to be provided in the area of trade services, as well as in facilitating direct foreign investment flows. They expressed further support to the compensation of the least developed countries for the possible negative effect resulting from the Final Act of the Uruguay Round of Multilateral Trade Negotiations and for building capacities for maximising opportunities arising from these agreements and in this regard, they called upon the international community for operationalising the complementary provisions of the Marrakesh Agreement in favour of the LDCs.

404. The Heads of State or Government noted that, despite sharp declines in the levels of ODA and a price slump in many commodities, several African and Asian LDCs achieved encouraging levels of economic growth since 1995. This has largely been as a result of consistent implementation of economic policy reforms and thus, they called on the international community to recognise these important achievements and to support development efforts of all LDCs.

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Land-locked Developing Countries

405. The Heads of State or Government, noting the additional costs incurred by land locked developing countries in developing their import and export markets, called on the international community to give special attention and support to the special development problems and needs of these countries, particularly through technical co-operation with and financial assistance by developed countries, and multilateral financial institutions to enable these countries to effectively participate in a rapidly globalising world economy.

406. The Heads of State or Government noted that transit developing countries faced serious economic problems and that their efforts at developing a viable transit infrastructure also needed financial and technical support from the international community. They noted that in some cases regional integration and co-operation efforts have also provided additional solutions to the specific problems confronting land-locked countries.

Small Island Developing States

407. The Heads of State or Government reaffirmed their full support for the system wide implementation of the Programme of Action for Sustainable Development of Small Island States adopted by the Global Conference on the Sustainable Development of Small Island Developing States which was held in Bridgetown, Barbados from 25 April to 6 May 1994. They reaffirmed in particular the need for the provision of adequate, predictable, new and additional financial resources, transfer of environmentally sound technologies on concessional and preferential terms, as mutually agreed, and the promotion of non-discriminatory trading arrangements. They also noted the need for appropriate exchanges among small island developing states as well as between them and other States with similar development experiences to be encouraged.

408. The Heads of State or Government recognised the importance of the Barbados Plan of Action in identifying and addressing the problems and vulnerability of the Small Island Developing States and reiterated the call for the support of the international community in the implementation of the Programme of Action including the on-going initiatives to establish a Vulnerability Index For SIDS. In this regard they welcomed the comprehensive review of the SIDS Programme of Action scheduled for 1999 and the decision of the 19th Special Session of the General Assembly to hold a two-day Special Session in 1999.

409. The Heads of State or Government welcomed the decision taken by the World Bank to set up a Task Force to study the problems of small States. In this regard, they called upon the Bretton Woods Institutions to review the criteria of per capita income and creditworthiness presently used as the measure for the graduation of members regarding access to the various types of loans. In the context of such a review, they recommended that the inherent structural and institutional constraints of Small Island States as well as the concept of vulnerability should also be used.