UNCTAD-What it stands for

Compiled by Boahene Asamoah

THE United Nation’s Conference on Trade and Development (UNCTAD) was established in 1964 to, among other things, promote the development-friendly integration of developing countries into the world economy.
In the early 1960s, growing concerns about the place of developing countries in international trade led many of these countries to call for the convening of a full-fledged conference specifically devoted to tackling these problems and identifying appropriate international actions.
Simultaneously, the developing countries established the Group of 77 to voice their concerns. (Today, the G77 has 131 members.)
The prominent Argentinean economist, Raúl Prebisch, who had headed the United Nations Economic Commission for Latin America and the Caribbean, became the organisation's first Secretary-General.

The first United Nations Conference on Trade and Development (UNCTAD) was held in Geneva in 1964.
Given the magnitude of the problems at stake and the need to address them, the conference was institutionalised to meet every four years, with intergovernmental bodies meeting between sessions and a permanent secretariat providing the necessary substantive and logistical support.

Over the past years UNCTAD has progressively evolved into an authoritative knowledge-based institution whose work aims to help shape current policy debates and thinking on development, with a particular focus on ensuring that domestic policies and international action are mutually supportive in bringing about sustainable development.
The organisation works to fulfil this mandate by carrying out three key functions:
It functions as a forum for intergovernmental deliberations, supported by discussions with experts and exchanges of experience, aimed at consensus building.
It undertakes research, policy analysis and data collection for the debates of government representatives and experts.
It provides technical assistance tailored to the specific requirements of developing countries, with special attention to the needs of the least developed countries and of economies in transition. When appropriate, UNCTAD cooperates with other organisations and donor countries in the delivery of technical assistance.
The Secretary-General of UNCTAD is Dr Supachai Panitchpakdi (Thailand), who took office on September 1, 2005.

In performing its functions, the secretariat works together with member governments and interacts with organisations of the United Nations system and regional commissions, as well as governmental institutions, non-governmental organisations, the private sector, including trade and industry associations; research institutes and universities worldwide.
The 1960s and 1970s
In its early decades of operation, UNCTAD gained authoritative standing:
*As an intergovernmental forum for North-South dialogue and negotiations on issues of interest to developing countries, including debates on the “New International Economic Order”.
*For its analytical research and policy advice on development issues.

Agreements launched by UNCTAD during this time include:
The Generalized System of Preferences (1968), whereby developed economies grant improved market access to exports from developing countries.
A number of International Commodities Agreements, which aimed at stabilising the prices of export products crucial for developing countries.
The Convention on a Code of Conduct for Liner Conferences, which strengthened the ability of developing countries to maintain national merchant fleets.
The adoption of a Set of Multilaterally Agreed Equitable Principles and Rules for the Control of Restrictive Business Practices. This work later evolved into what is today known as “Trade and Competition Policies”.
In addition to these, UNCTAD was a key contributor to the definition of the target of 0.7 per cent of gross domestic product (GDP) to be given as official development aid by developed countries to the poorest countries, as adopted by the United Nations General Assembly in 1970.
It also spearheaded the identification of the Group of Least Developed Countries (LDCs) as early as 1971, which drew attention to the particular needs of these poorest countries. UNCTAD became the focal point within the UN system for tackling LDC-related economic development issues.
In the 1980s, UNCTAD was faced with a changing economic and political environment:
There was a significant transformation in economic thinking. Development strategies became more market-oriented, focusing on trade liberalisation and privatisation of state enterprises.
A number of developing countries were plunged into severe debt crises. Despite structural adjustment programmes by the World Bank and the International Monetary Fund, most developing countries affected were not able to recover quickly. In many cases, they experienced negative growth and high rates of inflation. For this reason, the 1980s become known as the “lost decade”, particularly in Latin America.
Economic interdependence in the world also increased greatly.
In the light of these developments, UNCTAD multiplied efforts aimed at:
Strengthening the analytical content of its intergovernmental debate, particularly regarding macroeconomic management and international financial and monetary issues.
It was also aimed at broadening the scope of its activities to assist developing countries in their efforts to integrate into the world trading system. In this context,
the technical assistance provided by UNCTAD to developing countries was particularly important in the Uruguay Round of Trade negotiations, which had begun under the General Agreement on Tariffs and Trade (GATT) in 1986. UNCTAD played a key role in supporting the negotiations for the General Agreement on Trade in Services (GATS).
UNCTAD’s work on trade efficiency (customs facilitation, multimodal transport) made an important contribution to enabling developing economies to reap greater gains from trade.
UNCTAD assisted developing countries in the rescheduling of official debt in the Paris Club negotiations.
Promoting South-South cooperation.
In 1989, the Agreement on the Global System of Trade Preferences among Developing Countries (GSTP) came into force. It provided for the granting of tariff as well as non-tariff preferences among its members. To date, the agreement has been ratified by 44 countries.
UNCTAD addressed the concerns of the poorest nations by organising the first UN Conference on Least Developed Countries in 1981. Since then, two other international conferences have been held at 10-year intervals.
Key developments in the international context:
The conclusion of the Uruguay Round of Trade negotiations under the GATT resulted in the establishment of the World Trade Organisation in 1995, which led to a strengthening of the legal framework governing international trade.
A spectacular increase in international financial flows led to increasing financial instability and volatility.
Against this background, UNCTAD’s analysis gave early warning concerning the risks and the destructive impact of financial crises on development. Consequently, UNCTAD emphasised the need for a more development-oriented “international financial architecture”.

Foreign direct investment flows became a major component of globalisation.
UNCTAD highlighted the need for a differentiated approach to the problems of developing countries. Its 10th conference, held in Bangkok in February 2000, adopted a political declaration – “The Spirit of Bangkok” – as a strategy to address the development agenda in a globalising world.
In recent times, UNCTAD has further focused its analytical research on the linkages between trade, investment, technology and enterprise development.
It has also put forward a “positive agenda” for developing countries in international trade negotiations, designed to assist developing countries to better understand the complexity of the multilateral trade negotiations and in formulating their positions.
UNCTAD expanded work on international investment issues, following the merger into UNCTAD of the New York–based United Nations Centre on Transnational Corporations in 1993 and has expanded and diversified its technical assistance, which covers a wide range of areas, including training trade negotiators and addressing trade-related issues; debt management, investment policy reviews and the promotion of entrepreneurship; commodities; competition law and policy; and trade and environment.
UNCTAD XI
UNCTAD has continued to play a crucial role in emphasising the development dimension of issues in the fields of international trade and investment and related areas.
In particular, UNCTAD has been addressing the imbalances of globalisation and the need to overcome the supply constraints of developing countries, so as to ensure development gains and poverty reduction.
This is captured in the theme of the UNCTAD XI Ministerial Conference, Enhancing coherence between national development strategies and global economic processes towards economic growth and development, particularly of developing countries.

The Trade and Development Board

In the four years between the meetings of the conferences, UNCTAD’s work is guided by the Trade and Development Board. Board membership is open to all members of UNCTAD, and accredited intergovernmental and non-governmental organisations enjoy observer status.
The board meets in Geneva once a year in regular session and up to three times a year in executive sessions to deal with ad hoc policy and institutional issues.
The Commissions
The Trade and Development Board currently has three commissions that meet once a year to address policy issues in specific areas and provide guidance for the work of the secretariat. These commissions are the Commission on Trade in Goods and Services; the Commodities, Commission on Investment, Technology and Related Financial Issues,
and Commission on Enterprise, Business Facilitation and Development.
The UNCTAD Secretariat also services the Commission on Science and Technology for Development (CSTD), which is a subsidiary body of the United Nations Economic and Social Council.
These commissions allow governments to exchange views on policy issues in their respective ambits.
As in all of UNCTAD’s intergovernmental bodies, decisions of the commissions are taken by consensus, and thus agreed conclusions and recommendations reflect the collective political will of UNCTAD’s membership.
Expert Meetings
The work of the commissions is supported by discussions among specialised technical experts in specific fields. Up to 10 such expert meetings are convened by the commissions every year. They allow the government representatives attending the commissions to take advantage of valuable technical input from academics, practitioners and the private sector.