UN economic council plan under fire

Many developing countries fear industrial nations will dominate such a set-up.

A PROPOSAL by the United Nations Secretary-General to set up an Economic Security Council has been slammed by many developing countries, which fear that such a body would be dominated by industrialized countries.

The opponents are also concerned that the new World Trade Organisation (WTO) would be made a specialised agency under the council.

As a result, discussions on the question of the WTO’s relationship with the UN had become muddied and mired in the controversial proposal by Dr Boutros Ghali, said Gatt sources in Geneva.

The issue arose from Dr Ghali’s proposed Agenda for Development to Gatt director-general Peter Sutherland earlier this year, indicating the UN’s readiness to co-operate fully with the WTO and seeking further exchange of views for developing common approaches. His agenda recommended the creation of a UN Economic Security Council, a decision-making forum to review the threats to global human security and to act as a watchdog of specialised agencies such as the International Monetary Fund (IMF) and the World Bank.

Dr Ghali also felt that it was imperative that the new WTO “is set up from the outset as a specialised agency of the UN”. The WTO is due to start functioning from Jan 1.

The proposed Economic Security Council is part of the reforms being undertaken to overhaul the UN.

The final act of the Uruguay Round signed in Marrakesh, Morocco, in April has no provision on WTO’s link with the UN. But it states that the WTO General Council could “make appropriate arrangements for effective co-operation with other inter-governmental organisations that have responsibilities related to those of the WTO”.

In debates on the issue, delegations of the General Agreement on Tariffs and Trade (Gatt) based in Geneva said that while they favoured co-ordination between the WTO and the UN at a working level, they were against the new trade body becoming a specialised agency.

The United States, the European Union (EU) and many developing countries such as Indonesia and India, were among those which opposed the UN idea.

The developing countries feared that their contractual rights and obligations in the trading system could be eroded easily if the so-called economic council followed the footsteps of the present Security Council.

They are worried that the major industrial countries would impose their will on the developing countries.

Mr. Sutherland is also said to have signaled his personal disapproval and told Dr Ghali that the WTO’s relations with the UN would have to be considered in the context of its ties with other organisations.

The verbal wrangling over the UN proposal has stymied WTO’s own discussion on its relations with the UN Conference on Trade and Development (Unctad), an Asean Gatt diplomat told The Straits Times yesterday.

The WTO-UN relationship is on the WTO preparatory committee’s agenda.

It is being dealt with by the Sub-committee on Institutional, Procedural and Legal Matters chaired by Singapore’s Permanent UN Representative K. Kesavapany.

Gatt sources in Geneva said that at an informal meeting held in late September, the US and other delegations pointed out that there was no provision in the WTO agreements delineating a clear relationship with the UN.

The European Commission, representing the EU, also noted that there was nothing in the UN Charter calling for such a link.

Mr. Kesavapany told the meeting the issue was also being debated in Unctad and the UN General Assembly.

The debate is far from exhausted. The Straits Times understands that Dr Ghali is revising his draft agenda and would table a resolution on this in the UN General Assembly later this month.

GHALI’S BABY

The United Nations Economic Security Council as conceived by Dr Ghali (left) would act as: A decision-making forum to review the threats to global human security. A watchdog of specialised agencies, such as the International Monetary Fund and the World Bank