$Unique_ID{COW04013} $Pretitle{271} $Title{Venezuela Address at the Special Ministerial Meeting of the Group of 77} $Subtitle{} $Author{Carlos Andres Perez} $Affiliation{President of the Republic of Venezuela} $Subject{countries international group world cooperation development south economic developing north} $Date{1989} $Log{} Country: Venezuela Book: International Cooperation on a New Basis of Shared Responsibility Author: Carlos Andres Perez Affiliation: President of the Republic of Venezuela Date: 1989 Address at the Special Ministerial Meeting of the Group of 77 Address by the President of the Republic of Venezela, Mr. Carlos Andres Perez, at the Special Ministerial Meeting of the Group of 77, in commemoration of its XXV Anniversary, Caracas, June 21st., 1989. The current situation Venezuela is honoured to be hosting this exceptional Meeting of the Group of 77, which is commemorating its Twenty-Fifth Anniversary. It reflects our country's identification with the unchanging commitment to the cause of the peoples of the Third World, in the same spirit shown at the 1981 high Level Conference on Economic Cooperation among developing countries held in Caracas, which represents a landmark in the North-South Cooperation Process. Our endeavor to host this Ministerial Meeting is the outcome of our firm belief that is in times of crisis such as these that international solidarity is most necessary, even imperative, for demonstrating the political will to solve the severe problems afflicting our countries. The commemoration of the Group of 77's first quarter of a century finds us, the Third World countries, generally disheartened and skeptical about the truth of our unity and the possibilities of changing the International Economic Order we set out to bring about at the beginning of the sixties. We could not sincerely and adequately face the crisis enveloping us if we did not frankly admit the atmosphere of faint heartedness, bewilderment and incoherence in which we have gravitated in recent years. To such an extent that we have ended up being caught, as it were, in a trap that conspires against the very international solidarity and cooperation on which the Group of 77 was founded. The climate has been conductive to a pessimistic branding which magnifies our difficulties and exaggerates the various national differences between the countries of the South as being the cause of the misunderstandings. We must understand that twenty-five years is a short time in the course of this ever-changing world, which in its long history has witnessed the emergence and disappearance of entire civilizations. It is our duty to rise above all things immediate and circumstantial and appreciate all that is essential with abroad outlook, in order to assess the priceless potential and bargaining power of the Group of 77. Our goals must be unity and systematic action. The balance of the past twenty-five years However, the time and effort invested have not been in vain. Above all, the balance of this quarter of a century emphasizes the ability of the developing countries to bring nations together in order to ensure that the topic of North-South relations occupies a prominent place on the international agenda. And even though the new order we have proposed has not materialized, the proposition can no longer be avoided. Meanwhile some pioneer institutions, such as the International Fund for Agricultural Development and the UNCTAD Common Fund for the Integrated Program for Commodities, have been created, characterized by fair democratic decision-making patterns, which contrast with the cenacle form in which the traditional Bretton Woods-type financial bodies function. Despite the errors committed, in the area of cooperation among developing countries, we cannot ignore the major significance of the OPEP Fund and the strong proliferation of multiple South-South cooperation schemes that have appeared. The most outstanding in Latin America are ALADI, SELA, the Andean Group, the Argentina-Brazil-Uruguay Tripartite Agreement, CARICOM in the Caribbean, the Contadora Group, the Group of Eight; in Africa, the Organization for Africa Unity (OAU), the Organization of Southern African Countries, the recent Maghreb Integration scheme; in Asia, the Arab Fund for Economic and Social Development, the Gulf Cooperation Council, the Islamic Bank, ASEAN, the Southern Asian Association for Regional Cooperation, such as the Global System of Trade Preferences, and the "Manuel Perez Guerrero" Trust fund. As already acknowledged, in recent analysis of South-South cooperation, let us admit that such cooperation schemes have recently been permeated by much generalism and a lack of participation by the operational actors that guarantee the success of the programmes proposed. But the fact is that they also reflect the interest in mutual cooperation and, as well as having achieved success in certain specific aspects, they are an encouraging framework for future action. However, without in any way trying to shift our own blame, the formidable obstacle that has greatly contributed to the failure of the plans and projects of the developing countries has been, and still is, the unfair and dishonest system of international relations, the World Economic Order that constrains our action and undermines the prices of our commodities. Moreover, let us not forget that the majority of the economies of the industrialized countries was built on a high component of state inducement and protectionism which we also require for structuring our incipient economies. Without wishing to pay tribute to simplistic schemes, such as the free play of market forces and privatization, as magic formulae for solving our problems, we recognize the need for free flowing, more open, economies to enable our productive resources to be better utilized. On the other hand, the dogmatism of ideal development models is challenged today more than ever before by a generalized world wide crisis. In the North one can see how the extent to which the high degree of economic prosperity was achieved at the cost of destroying the environment, along with an immoral export of toxic waste to the Third World. And the alienation of broad sectors of the population of those countries by a materialist consumerist inducement which not for being more subtle is less wicked than other such inducements. A far reaching discussion of the redefinition of development, reassessing the concepts of wealth and poverty beyond the parameters of monetary income, in order in the world agenda, so that social environmental and cultural affairs, and the values of justice and equity, may be tackled in a manner more closely interwoven with strictly economic matters. The validity of the South We cannot let ourselves be deceived or confused by light and irresponsible criticism of our Third World attitudes. To claim that the feasibility of the common action and stand of the developing world as a whole, is subject to the degree of uniformity and homogeneity existing among the members countries of the South is a deceptive endeavor. The main raison d'etre of the South's unity lies elsewhere. Our unity tends to be based and structured more on an unfair discriminatory world order established by others, than on cultural, social, economic or national affinities. As Julius Nyerere summed it up with his singular lucidity: "What we have in common is that we are, in relation to the developed world, dependent-not interdependent nations. Each of our economies has developed as a by-product and a subsidiary of development in the industrialized North, as is externally oriented. We are not the prime movers of our own destiny. We are ashamed to admit it; but economically we are dependencies. It was practical experience of the fact that legal independence did not mean economic freedom which made most of us think in terms of cooperating with others similarly placed..." Our diversity may instead be an immense potential for complementations. That fantastic geographical and human kaleidoscope which is the Third World, houses two thirds of the plant and animal species of this planet. A heritage of growing value in a world whose living species are rapidly becoming extinct in the face of ecological unawareness. We have massive strategic mineral reserves, important endogenous technologies. And even significant surplus capital resources, which if they overcame the trap of being "recycled" to the North, might be a great incentive to investment in the South. The acknowledgement of the past and the present role of diversity in the explanation of the South's raison d'etre does not mean that our common action must not be based on more affirmative bonds, such as the constitution of a minimum common consensus on the type of national development we want. The most solid form of unity must be one that is based more on what affirmative than on action steeming from the pressure of external factors. In the future, one of our challenges could be, in the line with the new spirit of planetary conscience that seems to be gaining ground in the world, to seek a spirit of cooperation based more on authentic solidarity and human fraternity. The issue of the adjustment The issue of the adjustment, brought about by the dramatic external indebtedness of our countries, has become a key factor in current international economic discussions. Paradoxically, instead of uniting us, it has provoked the crisis of unity and the pessimism from which we are only now beginning to recover. In the three regions of the developing world there are around forty countries with more than 800 million in habitants undergoing serious financial straits as a result of the debt problem. As of 1982, these countries have signed close to 90 "debt rescheduling" agreements with the banks. Many are only able to comply but with a small portion of the debt service over the long term. Despite this fact, not one rescheduling has taken place in which the commercial banks have consented to interest rates lower than or equal to the markets rates, or general reductions in the amount of the debt. This pressing situation has been addressed with only superficial and half way measures, based on the "case by case" and "adjustment" approaches, without taking into account the external financial setting that is oppressing and exacting developing countries. When we have criticized the economic totalitarianism imposed on us and the at the top of which is the International Monetary Fund, we have referred to a conception that pretends to relegate, in a standardized and in sensitive manner, our countries' economic and social objective to immediate measures relating to fiscal and balance of payments equilibrium under the pretext of ensuring the payment of the debit. Not only has its failure been manifest, but the results have been dramatic for our countries. Even the director of the International Monetary Fund has recently acknowledged the following: "The first is that the adjustment does not have to lower basic human standards. In this context, the efforts of fellow agencies of the United Nations system both to protect social programs in the face of unavoidable budget cuts and to make some programs more efficient-delivering better services at less cost-exemplify the type of things that are essential. My second conviction is that the more adjustment effort gives proper weight to social realities-specially the implications for the poorest-the more successful they are likely to be". The Brady Plan, upon recognizing for the first time the need for a substantial reduction in debt obligations, constitutes a significant and concrete initiative regarding an improvement in the situation. Nevertheless, we are still impatiently awaiting its implementation, under better terms and conditions geared to the scope and urgency of the situation facing us. We, the developing countries, should be prepared to assume our responsibility in taking on the structural changes essential for improving and sharing up our economies on a rational and self-sustained basis. However, the developed countries, leading authors of the prevailing international order, should assume their responsibility for the necessary changes regarding the structure and management of their economies. We, as countries of the South cannot accept the demands for the "tightening our belts" while there are countries in the North that base their prosperity on outstanding fiscal and trade deficits at the expense of the rest of the world. Neither can we accept the preaching on the opening up of trade when the markets of the North are closed down to our products. Similar considerations hold for international commercial banks that have become accustomed to easy profits at the expense of keeping developing countries in an unsustainable situation. We have unrelentingly requested constructive cooperation and dialogue for addressing such a serious situation. But our patience and endurance have a limit. The raison d'etre of the group of 77 The underlying rationale and raison d'etre giving rise to the Group of 77 gains more force with the passing of time. On the other hand, let us acknowledge that a substantial updating of such raison d'etre is necessary in the light of experience. To this end, it would seem in order: 1. To give more practical content to the basic postulate of Unity in Diversity, that is, give a place within the general framework that is used as a platform by the Group, to regional and national differences on specific issues. The best recognition of the strength of diversity should be accompanied by the rationalization of the international negotiation agenda, something in which we have so far not been very successful, but which has become absolutely imperative today, if we wish the negotiations to be really effective on a global scale. Whether in the ambient of South-South or of North-South, we cannot continue to use the over loaded agendas of the past, but must be much more global, reserving specific subject matters for the specific form. 2. To effectively strengthen South-South relations, as the path to the firmer and more reliable revitalization of North-South relations. The most important lesson in the failure of the North-South dialogue during the decade of the seventies was the absence of significant and sustained South-South action that might have fortified the position of the South with respect to the North. It is a matter of facing a highly unequal interaction, characterized by Julius Nyerere in the following terms: "The North knows about the South. The South knows about the North. But the South doesn't know about itself". The South cannot pretend, with its still so incipient organization, to be a valid interlocutor to Northern countries groups such as the OECD, the EEC and the CMEA, endowed with mechanisms for organization and for the promotion of mutual relations that are supported by technical offices with hundreds of their own international officers. Systematic and sustained technical support for the South, with or without the formal backing of all its member countries, has already become a necessity that absolutely cannot be put off if the standing and efficacy of the Group of 77 are to beassured. For this reason, I have always stressed the need of establishing a secretariat for the Group, or a secretariat for the developing countries, which will instill continuity, persistence and follow-up to all actions that we have undertaken and have remained unfulfilled. 3. Open the activities of the Group to new, more operative, players, with the capacity for practical instrumentation, such as public and private entrepreneurs, non-governmental organizations in general, as well as more like-minded countries from the North and the East. 4. At the same time, raise the political level of the South-South dialogue, by means of periodic meetings of Heads of State, which do not necessarily have to include all the countries, if that makes it more difficult to achieve the fluidity and the desirable nature of these meetings in effectively accomplishing their role of orientation and decision making. 5. Broaden the scope of the agenda of the Group to go beyond economic matters and include other subjects such as social, environmental, political and cultural matters, and the role of national development policies-both in the South as well as in the North-in maintaining viable and lasting international relations. In relation to the latter, the objective is in full force of attaining a new international consensus about development which, while recognizing national specific circumstances, may serve as a basis for the revitalization of international cooperation. I cannot refrain from mentioning the importance of the contribution to be made by the South Commission has launched a self-critical and creative long-reach effort in terms of the problems we are facing, and their final results will be made public next year. Its contribution shall be an invaluable assistance for our future struggle. International negotiations On the success we achieve at this meeting, in clarifying the fundamental questions that update the raison d'etre of the Group of 77, will in turn depend the success the Group may achieve in two key international negotiations in the near future, which will take place within the framework of the United Nations. I refer to the Special Session of the UN General Assembly on International cooperation for Development, and to the formulation of the international Development strategy for the Fourth United Nations Development. In relation to the Special Session, it is in any case worth emphasizing its importance as a potential platform for the revitalization of the North-South dialogue. With the purpose of initiating a true accord between the North and the South in the United Nations, for finding solutions to the pressing problems of development of the Third World, taking into account the undelayable need to attack in structural and interrelated form the major issues of trade, finance, monetary matters and development. I have already announced my readiness to attend this important forum. In relation to the International Development Strategy, we must overcome the frustration felt about the strategic dispersion of this decade of the 80s, which was in the end termed as the "lost decade for development", and which I have called the perverse decade, because it disjointed our action and anarchized our behavior, catching us in the trap of a misunderstood nationalism. Fifteen years after the Declaration of the United Nations on the establishment of a New International Economic Order, it remains the imperative goal, once demanded by the old and the new problems. The circumstances we are living through, only revindicate the leadership our Group should recover, exercising a visionary sense of international responsibility. I cannot refrain from evoking, in this hall which bears his name, the memory, of that renowned fighter and ideologist of the Third World, our compatriot Manuel Perez Guerrero. His inspiring legacy is more in force today than ever before. To those who did not understand the importance of the unity of the Group of 77, he said: "The solidarity of the entire international community passes through the solidarity of the developing countries". May this phrase of a consequent militant in the cause of the Third World, who knew at all times how to conciliate it with universal internationalism, inspire us to value fully the meaning of this extraordinary meeting holds for us and the rest of the world.