I should like to begin by extending my
delegation's congratulations to Mr. Hollai on his
election to the presidency of this session of the
General Assembly. He has served many years in the
Organization. The reputation he has acquired
among his peers is that of an extremely able,
knowledgeable, affable man of goodwill. I should
also like to say a word of thanks to his
predecessor, Mr. Kittani, for the excellent job
he did.
207. I have read the report of the
Secretary-General on the work of the Organization
with great admiration. It is refreshingly frank
and self-critical. I agree with him that our most
urgent goal is to reconstruct the United Nations
collective security system. With¬out such a
system, first, Governments will feel it necessary
to arm themselves beyond their means for their
own security; secondly, the world com¬munity will
remain powerless to deal with military adventures
such as Israel's invasion of Lebanon, the USSR's
invasion of Afghanistan and Viet Nam's invasion
of Kampuchea; thirdly, local conflicts will
threaten to widen and escalate; fourthly, there
will be no reliable defense for the small and
weak nations; and finally, all our efforts on the
economic and social side may well falter.
208. The Secretary-General has made a number
of specific recommendations on how to strengthen
the United Nations collective security system.
The Independent Commission on Security and
Disarma¬ment Issues, chaired by Mr. Olof Palme of
Sweden, has also made a number of interesting
recommen¬dations on the same subject." I urge the
Security Council to consider these
recommendations as soon as possible.
209. Turning to the specific conflicts and
situations which threaten international peace and
security, the Secretary-General was cautiously
optimistic on Namibia. He reports that after many
setbacks, we now see some signs of the
possibility of a solution. Apart from the
solitary exception of Namibia, the past year has
witnessed no progress in our efforts to promote
negotiated settlements on the conflicts in the
Middle East and elsewhere.
210. In the conflict in Kampuchea, our various
reso¬lutions have not brought about the
withdrawal of Viet¬namese forces. But the
unambiguous position of the vast majority of
nations, as reflected in the resolution and the
Declaration of the International Conference on
Kampuchea, has denied legitimacy to the
aggres¬sor, has stiffened and heartened patriotic
resistance to foreign occupation and encouraged
the various resistance factions to unite their
efforts under the leadership of Prince Norodom
Sihanouk. Thus, the aggressor has not been
allowed to enjoy the fruits of its actions.
211. The position of my delegation on the
other questions on the agenda of this session
will be enun¬ciated when these items are
considered by the General Assembly.
212. All the conflicts which the Assembly was
con¬sidering when we last met are still with us
today. The new wars in the South Atlantic and
Lebanon have shown us how quickly and
unexpectedly violence and turmoil can spread.
Every day newspaper headlines and the television
screen bring the terrible carnage into every home.
213. While these events have captured the
attention of the world, an economic crisis, no
less lethal In its effects on people, has been
spreading through the world. One symptom of this
crisis is the debt prob¬lem. In recent months the
world's headlines have drawn attention to the
problem of third-world debt. It is estimated that
the third_ world's debt js more than $US 500
billion. These debts were not accumu¬lated
overnight. The problem has been brewing for some
time. It is a combination of the problem of non-
oil-producing third world countries trying to
adjust to changes in energy costs and the
oil-producing third world countries embarking on
massive development projects in anticipation of
future oil income
214. The non-oil-producing third world
countries were first hit by high energy prices.
They were then hjt from another direction as the
industrialized coun¬tries increased the prices of
their products to meet increased energy costs. To
add to these difficulties, the recession in the
industrialized countries depressed the prices of
the primary commodities produced by these third
world countries. Squeezed between high costs and
falling incomes, these poor countries have had to
resort to massive borrowing for consumption and
not for investment. It is inconceivable to me how
this debt can be repaid or the interest serviced.
215. Default on even a portion of the massive
debts that have accumulated could trigger a total
collapse of the global financial system, which
would, in turn, lead to a deep global recession.
The mild panic that seized the financial pundits
of the West when they grasped the implications of
the situation that they had got themselves into
now seems to have been replaced by a mood of
superficial confidence, perhaps because no one
dares believe otherwise; no one dares say that
the emperor has no clothes.
216. Another problem with grave implications
is that of starvation. As much as 40 per cent of
the world's population suffers from some form of
undernourish¬ment. The fate of millions is
downright starvation. As the population continues
to increase in the poorest regions of the world,
more and more people will be forced below the
subsistence level of food intake.
Undernourishment and starvation are the work not
of fate but of human action. They can be
prevented. Much of the increasing starvation can
be attributed to the failure of national
policies. But we are not here to pass judgment on
national policies; we are here to see how we as
members of an international community can help
these nations in their plight. The problem is
particularly severe in Africa, where food
con¬sumption per person is 10 per cent less today
than it was a decade ago.
217. The problems of debt and famine, which I
have quoted as examples of the less
headline-grabbing prob¬lems of the global
community, are themselves only symptoms of a far
more serious malaise in the inter¬national
economy.
218. While the problem of global equity
remains serious, what we are confronted with
today is not simply the failure of the North to
respond to the South's call for a more equitable
economic relation¬ship but the incipient
disintegration of the entire economic system that
has sustained both North and South for the past
40 years. The consequences of such a total
collapse would far outweigh the present
injustices of the system. A renowned professor of
the London School of Economics, which is not
unsympathetic to the third world, once remarked
that the misery of being exploited by capitalists
is nothing compared to the misery of not being
exploited at all.
219. The liberal trading regime set up after
the Second World War and institutionalized in
GATT has clearly been unable to cope with the
stresses and strains generated by new conditions.
The developed countries have been unable to cope
with the increas¬ingly sensitive impact that one
national economy has on another under conditions
of interdependence and they have been unable to
restructure their domestic economies to deal with
new patterns of international trade, production
and consumption.
220. The result has been increasing
protectionism in the form of a complex system of
"orderly marketing arrangements", "voluntary
export re¬straints" and a host of other
euphemistically named non-tariff barriers
designed to circumvent GATT. So prevalent have
such practices become that the danger is that
exceptions to GATT will become more numerous than
instances of compliance. The effect of such
protectionism has been to freeze the existing
distribution of industrial capability and wealth.
One recent study has demonstrated that three
quarters of all actions to restrict imports under
safeguard, surveillance and anti-dumping
provisions dealt with only three product groups:
steel, textiles and clothing. Locational
advantages in such production have shifted
rapidly, and, by and large, the lowest- cost
producers are now countries in the third world,
which are now being penalized for their success.
221. The problems of debt, famine and protectionism
are interrelated. Protectionism freezes existing
patterns of international trade in which the
developed countries have consistently enjoyed
huge trade sur¬pluses W.s-n-ws the developing
countries. Such imbalances require financing and
thus necessitate heavy borrowing and a growing
debt burden.
222. Protectionism also deliberately restricts
levels of food production. In Japan, North
America and Europe protectionist agricultural
systems have included measures to curtail the
production of surpluses of major cereals and some
other commodities. The European Economic
Community has for two decades subsidized farm
production while keeping out cheaper imports. The
inevitable surplus stocks lie idle white much of
the world starves. The lesson is clear. The
liberal trading system, in spite of all its
faults, offers the best framework for a more
equitable international economic system. It is
increasingly clear that more developing countries
are becoming competitive in the international
market. It is also becoming clear that if the
principles of comparative advantage are allowed
to operate unhindered, this must result in a
correction of the grossly disproportionate
consumption of the world's resources by the
developed countries. We cannot hope for a more
equitable distribution of global income if the
liberal trading regime continues to be
under¬mined.
223. To my mind, the basic cause of
protectionism is the failure of the developed
countries to manage State welfare within national
means and to direct economic growth to keep pace
with technological changes. Over-expenditure on
welfare has resulted in inflexible domestic
political structures. Governments of the
developed countries have been deprived of the
political flexibility needed to make changes in
international patterns of trade and production
without resort to protectionism.
224. The pressure for protectionism comes from
many quarters. It comes from industries in
developed countries which have not modernized
their production processes and thus find
themselves unable to compete with more efficient
and lower-cost plants in developing countries.
But the political pressures for protectionism
also come from trade union movements in the
devel-oped countries, which, acting from a
short-sighted desire to protect workers in
declining industries, have urged and forced
protectionist measures on Governments.
225. They have sought to organize boycotts of
third- world products and services under the
guise of con¬cern for the heath of workers in
developing countries or of preventing
exploitation of workers in those countries. The
charge that exports from developing countries are
based on cheap labor is simplistic. It is true
that the wages of third-world workers are lower
than those of workers in developed countries. But
the choice before the workers in the third world
is either one meal or starvation. For no third
world country with all the inherent drawbacks of
its low development status can be competitive if
its workers are paid the wages of workers in
developed coun¬tries. Thus, when union leaders in
some developed countries insist that wages and
working conditions enjoyed by them must be
accorded to workers in the third world countries,
they are in fact telling the workers in the third
world to starve. There are no welfare benefits
and unemployment pay in most third world
countries. The irony is that low-cost imports
from the third world would certainly benefit the
con¬sumer in developed countries by reducing his
cost of living.
226. There has been a great change in the
attitude of the developed countries towards
third-world devel¬opment. In the immediate
post-war years, the developed countries took a
very positive view of economic development in the
third world. From the late 1940s to the 1960s,
they believed that it was in their interest to
help in the economic development of the poorer
nations of the world. These three decades of
generous technical and monetary assistance to
help these countries take advantage of the
benefits of the free-trade system.
227. Today the attitude of the rich nations to
eco¬nomic development in the third world is a
mixture of disillusionment and fear. To be frank,
much of the blame for the disillusionment can be
laid at the door of developing countries
themselves. The launching of over-ambitious and
prestigious projects has not encour¬aged those
who are sympathetic to aid programmes. More
important, huge arms expenditures in pursuit of
ancient conflicts and animosities against
neighbors has crippled economic growth in some
developing countries. Much emphasis has lately
been placed on economic co-operation among
developing countries. The most vital form of
co-operation among developing countries is
co-operation to maintain peace and stability
among neighbors.
228. In this respect I should like to point to
the regional grouping of the Association of
South-East Asian Nations which has created
an area of peace, amity and co-operation among
its five members. Its members have therefore been
able to derive the maximum benefit from their
national economic devel¬opment policies.
229. While we must not ignore the shortcomings
in the third world, it is also true that a number
of third world countries, in response to Western
exhortations that they should trade rather than
depend on aid, have manifested a capacity to
compete with the West in industrial areas
involving low technology. The response in the
developed world to this modest suc¬cess at
development has not been praise or
encour¬agement. Rather, there have been alarmist
calls for protection from entrepreneurs and
labour unions in developed countries.
230. The developing countries of the third
world are thus caught in a "no-win" situation. If
they are unsuccessful in their development
efforts, they are condemned for inefficiency,
corruption, xenophobia and a host of other evils.
If they should succeed, they are penalized for
their very success.
231. The slow strangulation of a liberal
trading system with increase international
tension. The television cameras may not notice
the process, but I fear that, if we continue to
neglect the problem, we shall have all too much
drama. The major devel-oped countries are
increasingly divided among them¬selves. The North
and the South will move further apart.
Desperation will breed irresponsibility. The
benefits of all this will redound to those Powers
that profit from and exploit instability and
divisions. The result will be an increase in
international insta¬bility. This threat to the
stability of the international system is
fundamental. In an interdependent world, autarky
is no longer a viable option for any nation. The
question that all of us must face is whether we
can muster sufficient political will to preserve
the integrity of the system before the point of
no return is reached.