In the early 1960s, colonies around the world started gaining independence. They were in dire need of a recipe for growth and development. Between April and June 1964, the UN held its first conference on trade and development in Geneva, Switzerland, and later the same year it established the UN Conference on Trade and Development (UNCTAD) to promote fair trade as a way for Third World countries to create economic development.
UNCTAD’s first secretary-general was Raul Prebisch, an Argentine academic and theoretician in the field of economic development. He later became executive secretary of the UN Economic Commission for Latin America and the Caribbean. In his research, he discovered that the economic development of Latin American states and modernization theory were incompatible, that the more a peripheral country trades with a core country, the less able it is to develop.
This “unfair trade condition” is a result of the long-term economic and political behavior of developed countries. This behavior has caused imbalances in international trade prices that would not occur in free trade.
UNCTAD’s most important responsibility has therefore been to use the UN’s influence to adjust international price distortions to allow new economies to grow and develop.
This should be pursued, but mainstream circles in trade and development studies do not agree, turning the issue into a longstanding academic dispute. Because decisions in the IMF and World Bank are made based on the varying contributions by their member countries — differing from the UN’s general “one vote per country” process — IMF and World Bank decisions are controlled by advanced countries, led by the US. The WTO has pulled out all the stops in its push for trade liberalization.
It was to address these shortcomings that Third World countries created UNCTAD.
Since 1964, UNCTAD has held a conference every four years. The quadrennial conference draws the focus of observers from all corners of society because decisions with far-reaching consequences are made. Some of its more important decisions have been the demand that IMF member countries import large volumes of goods; calling for the construction of the Generalized System of Preferences (GSP) — a formal set of WTO rules; launching international commodities agreements aimed at stabilizing the prices of export products, and demanding that advanced countries set aside at least 0.7 percent of their GDP for foreign aid.
Through the US, Taiwan has been the biggest beneficiary of the GSP system and it only seems appropriate that we should give back to the international community. However, to this day Taiwan has not set up a GSP system for any of the least developed countries.
Even if we ignore the 0.7 percent requirement and instead look at 0.2 percent — the average foreign aid as a percentage of GDP of the 22 member countries in the Organisation of Economic Co-operation and Development’s Development Assistance Committee — Taiwan should be giving NT$29.2 billion (US$962.1 million) in foreign aid based on its GDP of NT$14.6 trillion in 2012. However, the total value of the funds available to the International Cooperation and Development Fund, the organization in charge of the nation’s foreign aid, is just NT$15.8 billion.
As UNCTAD marks its 50th anniversary, it is perhaps time that Taiwan started considering its international role.
Tu Jenn-hwa is director of the Commerce Development Research Institute’s business development and policy research department.
Translated by Perry Svensson
Could Asia be on the verge of a new wave of nuclear proliferation? A look back at the early history of the North Atlantic Treaty Organization (NATO), which recently celebrated its 75th anniversary, illuminates some reasons for concern in the Indo-Pacific today. US Secretary of Defense Lloyd Austin recently described NATO as “the most powerful and successful alliance in history,” but the organization’s early years were not without challenges. At its inception, the signing of the North Atlantic Treaty marked a sea change in American strategic thinking. The United States had been intent on withdrawing from Europe in the years following
My wife and I spent the week in the interior of Taiwan where Shuyuan spent her childhood. In that town there is a street that functions as an open farmer’s market. Walk along that street, as Shuyuan did yesterday, and it is next to impossible to come home empty-handed. Some mangoes that looked vaguely like others we had seen around here ended up on our table. Shuyuan told how she had bought them from a little old farmer woman from the countryside who said the mangoes were from a very old tree she had on her property. The big surprise
The issue of China’s overcapacity has drawn greater global attention recently, with US Secretary of the Treasury Janet Yellen urging Beijing to address its excess production in key industries during her visit to China last week. Meanwhile in Brussels, European Commission President Ursula von der Leyen last week said that Europe must have a tough talk with China on its perceived overcapacity and unfair trade practices. The remarks by Yellen and Von der Leyen come as China’s economy is undergoing a painful transition. Beijing is trying to steer the world’s second-largest economy out of a COVID-19 slump, the property crisis and
Former president Ma Ying-jeou’s (馬英九) trip to China provides a pertinent reminder of why Taiwanese protested so vociferously against attempts to force through the cross-strait service trade agreement in 2014 and why, since Ma’s presidential election win in 2012, they have not voted in another Chinese Nationalist Party (KMT) candidate. While the nation narrowly avoided tragedy — the treaty would have put Taiwan on the path toward the demobilization of its democracy, which Courtney Donovan Smith wrote about in the Taipei Times in “With the Sunflower movement Taiwan dodged a bullet” — Ma’s political swansong in China, which included fawning dithyrambs