Guyana

I join with those who have spoken before me in congratulating General Assembly President d’Escoto-Brockmann on his election to guide the work of the Assembly at its sixty-third session. As we meet this week, the global financial system is confronting its sternest test in recent memory. The current crisis is systemic in nature, historic in scale and global in reach. It comes at a time when the world economy is still wrestling with the most rapid escalation, and the highest real levels ever recorded, in the prices for fuel and food commodities. Together with the world’s belated attention to the devastating economic and social implications of climate change, those developments define the agenda before global institutions and national leaders today. They make the theme for this year’s debate both timely and necessary. Given the gravity and urgency of the issues before us, we must be careful not to conduct this year’s debate in the customary rhetorical manner. Instead, we must resolve to translate the detailed analysis, lofty statements and good intentions for which the Assembly has become well known into concrete actions that the current circumstances demand of us, and on which history will judge us. We must each, as countries approaching the podium to speak, be prepared to account for the pledges we have previously made. We must also be bold enough to embark on a project to achieve real change in the multilateral system. That change must be based on mandates that are relevant, institutions that are accountable and a context that is increasingly reflective of integration and interconnectedness. Indeed, I would urge that the theme of the next General Assembly should emphasize accountability and coherence of action on the part of the developed world in matters related to aid, trade and development. Often, when taken together, the policies of those countries result in a significant net loss of welfare in the developing world and run counter to their declared intentions — for example, the achievement of the Millennium Development Goals (MDGs) by 2015. 23 08-51606 An episode that manifested itself merely two years ago as a moderate decline in the housing market in some parts of the United States, and that evolved into difficulties for that country’s sub-prime mortgage market, has now grown into a rapidly deepening systemic financial crisis of global proportions. Even if they are not fully integrated into the global financial system, small vulnerable economies such as Guyana will bear the full effect of those developments as demand for exports tightens, the cost of capital rises, foreign direct investment becomes scarce and tourist arrivals and migrant remittances decline. In short, economic growth and poverty reduction efforts will suffer a severe setback and the Millennium Development Goals will become even more elusive. At the same time, crude oil prices rose by 148 per cent during the 18 months preceding July of this year. In turn, that has contributed to increasing prices for food commodities — in particular for such staples as cereals — rising in some cases by more than 200 per cent during the same period. While there have been some signs in recent weeks of those increases tapering off, and in some cases reversing marginally, the outlook clearly suggests that high prices for energy and food are here to stay. Without a doubt, increased food prices provide an important opportunity and incentive to farmers and agricultural economies to increase production. However, they also present grave implications for access to food, in particular by the poor and, by extension, for key nutrition and health indicators among our populations. The 2007 World Development Report shows that growth generated by agriculture can be up to four times more effective in reducing poverty than growth in other sectors. Yet the share of agriculture in official development assistance fell from 17 per cent in 1980 to just 2.9 per cent in 2006. Agriculture must therefore be given high priority in the international agenda as well as in national budgets. It is also urgently necessary for large developed countries to re-examine ways in which current inefficient and distortionary trade policies, in particular subsidies that support inefficient domestic production and tariffs that protect against more competitive imports, can be restructured to reduce distortions in the global marketplace. Given the impact that persistently high food prices into the future will have on the poor, the global community must commit itself to designing and funding appropriate safety nets to ensure improved access to food and the maintenance of basic nutrition. In recent times, the Assembly has been deeply concerned about the consequences of climate change, and rightly so. But future generations demand that that concern be translated into rapid action. The climate change challenge will not slow down to meet the pace set by the United Nations. Our response must speed up to meet the pace of climate change. The facts are straightforward. If we are to avoid catastrophic climate breakdown, we need to stabilize annual greenhouse gas emissions at about the equivalent of 2 tonnes of carbon dioxide per capita by 2050. Therefore, let the debate move on to how we make that happen, and not stagnate on a paralysing fear born from the magnitude of the problem. There are some promising signs. The Kyoto Protocol has resulted in the emergence of a $60 billion carbon market, which is a welcome start. But although common sense dictates that those financial flows should be proportional to the problem being addressed, the bulk of that money stays within the developed world. As a rainforest country, Guyana is particularly aware that there is virtually no capital flowing to address tropical deforestation — despite the fact that it causes 20 per cent of greenhouse gas emissions and, as analyses done by the Intergovernmental Panel on Climate Change, Nicholas Stern and others have highlighted, doing so is the most cost-effective abatement solution. That is because the Kyoto Protocol contains no significant incentives to slow the rate of tropical deforestation. As leaders, we must set a clear direction for our negotiators as we send them to agree a post-Kyoto climate agreement, one that asserts a sense of proportionality in addressing the causes of climate change and ensures that all major mitigation options are pursued. We must also break the false debate that suggests that countries must choose between combating climate change and supporting national development. Instead, we need to forge new high- growth, low-carbon economies and make national development supportive of progress towards global emissions targets. 08-51606 24 Specifically, those of us who are leaders of rainforest countries need to understand that we provide services that are vital to the health of our planet and that, when we seek capital flows to compensate for that, we are not merely acting as passive poor countries looking for aid: we are providing a critical component of the climate solution and we should be leading the design of mechanisms as we forge a post-Kyoto climate agreement. In Guyana, despite the fact that 85 per cent of our people live below sea level and are already suffering from changing weather patterns and rising water levels, we do not want to just complain about climate change. Instead, we want to partner with others to create a solution. As part of that, we are ready to discuss placing almost our entire rainforest in the service of the world if the right economic incentives are created and if that can be done in a way that neither trades sovereignty over our forest nor restricts the legitimate development aspirations of our people. The African, Caribbean and Pacific (ACP) countries are currently negotiating an economic partnership agreement with the European Union (EU). That agreement may fundamentally affect development in our societies and jeopardize our future negotiating positions at the World Trade Organization (WTO). The European Commission has threatened to impose tariffs on our exports under the Generalized System of Preferences if we do not sign agreements that reflect the EU’s model of WTO compatibility, even though the model includes issues that have been removed from the WTO agenda — the so-called Singapore issues. Those agreements will also seriously prejudice our negotiations with other countries and may jeopardize the future of our integration movement. The exploitation of the EU’s superior negotiating strength and the use of threats to get countries to sign are, ironically, how the EU hopes to start this partnership under the economic partnership agreement. What is particularly irksome is that we are incessantly lectured by the same group of countries to the effect that national consultations and working with civil society are essential hallmarks of good governance. Yet when the same civil society opposes the economic partnership agreement on the grounds that it is not sufficiently developmental in nature, we are told to ignore them — they are complainers. I wonder if the leaders of those countries know, or care, what is being done in their names. Even at this late hour, I wish to plead with the EU leaders to review those agreements before they irretrievably harm the good historic relations that have existed between the ACP and the EU. That brings me to the matter of the much-needed reform of our multilateral institutions, which has been on the agenda for some time. However, it would be fair to say that it has progressed slowly and its results have been few and difficult to observe. I believe that the reforms must be pursued along certain predefined principles. First, the institutions must have new mandates that are relevant to the current circumstances, and they must have at their disposal tools to discharge those mandates effectively. Secondly, the institutions must have legitimacy and reflect an equitable representation of their membership. Thirdly, in the discharge of their functions, they must demonstrate flexibility and responsiveness. Fourthly, they must display the highest standards of accountability and transparency. As I mentioned earlier, I believe that limitations in the mandate and functioning of the international financial institutions were a contributory factor in the current financial crisis. The mandate of the International Monetary Fund should explicitly be the preservation of systemic financial stability as a global public good. In addition, the use of passive surveillance as a general instrument and conditionality- based lending among the more vulnerable members have clearly proved to be ineffective. That is so not least because the incentives associated with conditionality-based lending are almost invariably never applicable to countries of systemic importance, and no mechanisms exist to encourage larger countries to respond to policy advice. Likewise, the World Bank should have a revised mandate that focuses on certain key development challenges, such as protection of the environment, clean energy and certain aspects of poverty reduction, instead of trying to address every development challenge and undermining its own effectiveness. In addition, more needs to be done to democratize the institutions, to align the interests of the management and staff with those of the countries they serve and to make them more accountable to the membership. Similarly, a more democratic and reformed United Nations Organization will be better placed to play a central role in the multilateral system in serving 25 08-51606 the interests of the international community as a whole, whether in relation to its peace and security mandates, the protection of fundamental rights or the promotion of development. Within the Commonwealth, heads of Government have developed a set of principles and guidelines that should underpin reform of the international institutions. Among their recommendations is a call for a conference along the lines of Bretton Woods to lead the way in determining the future of the international financial institutions. I trust that those principles and guidelines will be fully embraced. I wish this sixty-third session of the Assembly every success.