Statement by the German Government on 15 May 2001
On the occasion of LDCIII (14 to 20 May, 2001) in
Brussels
Delivered
by
Prof. Dr. Bohnet, Director General of the Federal Ministry for Economic Cooperation and Development
(Check Against Delivery)
Mr. Chairman, Excellencies, Distinguished Delegates,
At this very moment we indeed find ourselves conferring in a global village.
Whoever has access to a computer network can be a participant in the 3rd UN Conference on Least Developed Countries if they want to do so.
Therefore, a welcome goes out also to all interested people around the world
watching the Internet to witness what is happening in Brussels.
What is the situation like at present in the 49 LDCs? We see a world marked by
poverty, underdeveloped human capital and a pronounced susceptibility of
economies to external influences. More than half of the 610 million people
living in LDCs have to make their living with less than 1 US $ per day and thus
live in absolute poverty.
Lack of health care, absence of educational and training institutions, poor
water supply and sanitation, overloaded communication networks, bad traffic
routes and barely accessible rural areas - the list of infrastructural
constraints and obstacles to human development is almost endless.
Germany intends to continue to tackle the problem of poverty in the LDCs in a target-oriented
and focal manner.
I would like to mention six concrete actions:
First:
On the occasion of the millennium summit in September 2000 in New York,
Federal Chancellor Schr6der had given the undertaking that the Federal Republic
of Germany would draw up a poverty action programme. On April 4 this year the
German government adopted the
Programme "Poverty Reduction - a Global Responsibility", Programme of
Action 2015. The aim of the programme is:
This
programme on poverty reduction is of crucial importance for the LDCs.
A basic international understanding exists that a broadly ranged poverty
reduction must be the overarching goal of all development action. We are
committed to honoring this understanding.
Each country has the task to determine its own development priorities on the
basis of its individual responsibility and to establish an environment
conducive to development. But we also recognize the absolute need for LDC
governments committing themselves to a socially integrated policy of poverty
reduction, building upon the respect of human rights, good governance and
stability-oriented macro policies.
Second:
The German government underlines, that the fundamental development policy
orientation should essentially be based on poverty reduction strategies and
should contain core elements of a sustainable development. We advocate that
more light be shed on the economic dimension of poverty reduction. Only through
sustainable economic growth will it be possible to eliminate poverty in a
broadly effective and long-term manner. This conviction had impelled us to put
this aspect first in our "Priority Areas of Action" in our Programme
of Action 2015 under the heading "Boosting the Economy and Enhancing the
Active Participation of the Poor" and to pinpoint the special importance
of pro-poor-growth-oriented economic activities under the heading "Creating
Fair Trade Opportunities for Developing Countries" as a further priority
policy field. For that reason, the poor must be given fresh opportunities for
taking initiatives to determine their own destiny.
The Federal Minister for Economic
Cooperation and Development, Heidemarie Wieczorek-Zeul, underscores this policy
of enhancing economic initiative by organizing, together with the Cambodian
Minister of Trade and UNCTAD, the 5t" day of the LDC III conference in the
form of a thematic and interactive debate on "Enhancing productive
capacities: The role of investment and enterprise development".
"Public Private Partnerships" and their concrete design will be
highlighted in this context. Already in the run-up to the preparations of this
theme Germany had organized an international seminar on infrastructure
development in LDCs in which numerous LDCs have taken part; the results of this
seminar has been incorporated into this conference.
With its Public-Private
Partnership-strategy (PPP), the Federal Government intends to strengthen the
concerted action of official development co-operation and private business
activities.
Third:
LDCs especially will be able to make full
use of the opportunities inherent in private sector initiatives only if reforms
are introduced which prepare the ground for this. This includes a reduction of
their pressing debt burden. Therefore, the debt relief initiative of the
Cologne Summit in 1999 is of key significance for the perspectives of LDCs and
their people. Decisions on easing the burden have been taken on a total of 22
countries. 17 LDCs are already now profiting from this exercise. As a result of
the decision on their debt relief, these 17 LDCs will be given a nominal debt
service relief of some 23 billion US $. The budget funds available in addition
as a result of the HIPC Initiative for the social sectors amount to 1.2 % of
the Gross Domestic Product on an average. This means that budget increases for
health and education of more than 20% can be achieved.
Germany participates in the HIPC Initiative as a whole with bilateral debt
remissions totaling 5 billion US $. Furthermore, the German government pays 75
million US $ directly into the HIPC-Trust Fund established with the World Bank.
The German government's share in the EU contribution of 1 billion US $ amounts
to about one quarter of that sum. The German Federal Reserve Bank provides to
the IMF an interest-free loan of 300 million US $ with a maturity of 10 years
to finance the IMF share in the enlarged HIPC Initiative. It is estimated that,
of these amounts, more than 50 % benefit the LDCs.
Fourth:
The German government has already further
strengthened its bilateral co-operation with the LDCs. Whereas in the year 2000
the share of LDCs in bilateral DC amounted to 24.6 %, it rose to almost 30 % in
2001. This increase in shifting was done to benefit the following sectors in
particular:
Furthermore, the German government considerably contributes to the development
cooperation of the EU under the Cotonu Agreement, which are channeled almost
exclusively to LDCs. Germany's share in these contributions amounts to
approximately 24%. Also, the German government's contributions to multilateral
institutions, the World Bank and the regional development banks for the benefit
of LDCs are quite substantial.
Fifth:
The German government holds the view that an opening of the markets is a
substantial contribution to the development of LDCs. Besides the Cotonu
Agreement, free market access is a core element in integrating LDCs into the
global economy. For that reason we have explicitly supported the "Lamy
Initiative" by the EU Commission "Everything but Arms". Already
in the run-up to the preparations of the "Plan of Action for the
LDCs", the Market Access Initiative of the EU for LDCs was adopted on 26
February 2001. Since the beginning of March LDCs have free access to the EU
markets with the exception of only three products which are subject to
transitional periods. Other industrial countries and also the more advanced
developing countries should follow soon.
Sixth:
Another obstacle on the path towards a
more efficient and effective development cooperation has been removed in April
by the DAC/OECD. A decision was taken then to dispense with the tying of aid
under financial co-operation. The German government has given active support in
the DAC and in the G 8 process to the policy of abolishing tied aid. Our
partners in the LDCs will find it easier now to use their own criteria in
choosing the technologies to be deployed. All in all, financial cooperation can
be deployed much more effectively.
To conclude:
The German government wishes to contribute to the success of the third UN
Conference on LDCs. With its development policy, it wishes to actively support
the further integration of these countries into the global economy and the
combat against poverty in the LDCs. Thank you
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