Herbert Kröll, Head of the Austrian Delegation
,
LDC III Statement on May 14, 2001
Ladies and Gentlemen,
This morning, during the opening of LDC III, the needs of the LDCs’ and
the challenge of “how can we reach the international development goals” have
been dealt with extensively, emphasizing many aspects.
I associate myself in particular with the remarks on the eradication of
poverty made by UNSG Kofi Annan, EC President Prodi and the Swedish EU Council
President, PM Persson.
Therefore I will now concentrate on two aspects which Austria considers
very essential and which are nevertheless almost absent in the international
development discourse, for they do not yet receive the attention they deserve.
I mean the issue of economically and ecologically sustainable energy, and
second, the issue of industry as a driver of productive growth.
Energy services are indispensable for human survival and
development. They play a critical role
across the whole spectrum of development activities. Of the three billion people living in rural areas in developing
countries today, nearly 2 billion still have neither access to nor can pay for
modern energy carriers, such as electricity and/or liquid or gaseous
fuels. These energy carriers provide
essential energy services such as heating, motive power, lighting and cooling
(refrigeration), thus seriously reducing the income opportunities and quality
of life. The switch to modern energy
services for two billion people would amount to only 3% of global oil
consumption–when measured in terms of oil equivalent units–as relatively small
amounts of absolute energy are involved.
Yet such access would lead to vast gains in terms of human development,
in the social and economic well being of the women, men and children concerned,
who are currently among the poorest segments of the world’s population. Increased access to modern, reliable and
clean energy services is a necessary precondition for sustainable development
and poverty eradication.
Let me now come to my second issue: productive capacity development and
the role of industry.
LDCs need open markets, they need market access as it is granted by the
EBA initiative of the EU: tariff- and quota-free access for all products of
the LDCs.
However, market access is not everything. You need good governance, know
how, roads, ports, and energy. And, of course, you need goods and services
to sell: exports. The LDCs’ share of world exports is declining. Many LDCs
are stuck in a situation with no or not enough exportable goods. Many are
stuck with a few primary products with deteriorating terms of trade. Often
LDCs are synonymous with least industrialized countries. Economic decline
in most LDCs is intrinsically linked to the lack of recognition of the development
contribution of industry, and in particular manufacturing. Without enhancing
the role of industry, a sustainable path of economic development will not
be achieved. It is industry more than any other productive sector that drives
the economic growth process, provides a breeding ground for entrepreneurship,
fosters technological dynamism and associated productivity growth, creates
skilled jobs, and, through inter-sectoral linkages, establishes the foundation
for both agriculture and services to expand. Prices of manufactured exports
are both less volatile and less susceptible to long-term deterioration than
those of primary goods providing the potential for sustainable export growth
and integration into the global economy. In a nutshell: Unless competitive
production is built up, unless supply-side capacities are created, the LDCs
will be unable to benefit from liberalized trade flows and will fail to integrate
into the global economy.