Speech by Prime Minister Keizo Obuchi at the Tenth Session of UNCTAD Bangkok, Thailand

February 12, 2000

Mr. President,
Excellencies,
Secretary-General Kofi Annan of the United Nations,
Secretary-General Rubens Ricupero of UNCTAD,
All the representatives of international organizations,
Distinguished guests,

First of all, I would like to express my profound respect and appreciation to Prime Minister Chuan Leekpai, the Thai Government, and the people of Thailand for opening today the Tenth Session of the United Nations Conference on Trade and Development (UNCTAD X), the first major international conference of the new millennium, after having surmounted the unprecedented economic crisis through the concerted cooperation of both the government and the people. Looking back over the 20th Century, a period when the national boundaries of economic activity were eliminated and the global economy moved toward a unified system, I am again struck by how rapidly the world has changed.

At the starting point of the road into a new century, I believe it is essential for the stable development of the global economic system and the future prosperity of mankind to discuss how best to utilize the benefits of a unified world economy. At the same time, we must examine the challenge posed by the problems involved in that process.

Mr. President,

In the latter half of the 20th Century, trade, investment and capital flows have been dramatically liberalized and the harmonization of national economic systems has progressed rapidly. Owing to this trend, economic transactions now can be made anywhere in the world, as if in one's own country. Communications have also become easier and the volume of information available to us has been rapidly growing. Due to the development of electronic trading, we can purchase goods from the other side of the earth just as easily as buying things from a store in the neighborhood. This is the essence of the power of globalization, and it is extraordinary.

This progress is welcomed by consumers. It is leading producers to intensified competition, but is also facilitating innovations among them, allowing them easier access to information and technology throughout the world. What is most important is to further increase the convenience of such efficient economic activity and to enable all peoples around the world to benefit from it equally. With this in mind, Japan has actively engaged in diplomatic efforts toward the formulation of a desirable international economic system.

It is essential that the developing countries actively participate in this new sophisticated, information-oriented world economy, in order to fully benefit from globalization in the 21st Century. From this standpoint, Japan is prepared to provide financial assistance and extend cooperation for human resource development, both bilaterally and multilaterally, to help develop a sophisticated information and communication society in developing countries.

Mr. President,

Today, one of the most important tasks for managing the international economy is the maintenance and strengthening of the multilateral trading system embodied in the World Trade Organization (WTO). Reflecting upon the results of the Ministerial Conference in Seattle, I believe that at this moment confidence-building with the developing countries is our important task. It is particularly important to promptly launch a comprehensive round of negotiations, focusing not only on greater market access but also on strengthening WTO rules, while responding appropriately to the interests and concerns of the developing countries. Japan will make its utmost effort, together with other countries, in assuring the developing countries that they can also be the beneficiaries of the multilateral trading system.

In this context, recognizing the difficulties some of the developing countries face in implementing the WTO Agreements, Japan is prepared to provide support for human resource development totaling 2,500 personnel in developing countries over the next five years for capacity-building related to the implementation of the WTO Agreements. Moreover, with respect to imports from the least developed countries, we intend to take forward, with the participation of other major countries, an initiative to extend and implement duty-free and quota-free preferential treatment for essentially all products.

Mr. President,

The experience of many developing countries which have achieved growth as part of globalization offers valuable lessons to other developing countries. Japan has supported UNCTAD activities in actively transferring these experiences. In the year before last, Japan provided extensive financial assistance to the UNCTAD International Conference on African Development in a Comparative Perspective held in Mauritius. And Japan intends to consider supporting the future activities of the Institute for Trade and Development, an initiative proposed by the Government of Thailand during this meeting.

In order for development to proceed under globalization, it is important to provide the developing countries with the stable financial resources required for development. Amidst this globalization, the brisk economic activity by the private sector around the world has accelerated the provision of capital to the developing countries, fueling development. In order to make the best of this trend, it is necessary to ensure the stable flow of private sector capital without increasing the risk which comes with massive and rapid capital transfers. It is also important for each developing country to proceed with careful and orderly capital liberalization. On the part of the developing countries, there is a need to strengthen their financial systems, as well as to manage the macro-economy consistently while improving the trade and investment environment. On the part of the industrialized countries, there is a need to encourage the private sector to assess risks carefully before making investments.

Regarding these issues, I believe that in the future, UNCTAD should further develop its activities in technical cooperation to meet the specific needs of developing countries. It is also important to build a system that will accelerate capital flows among developing countries, by encouraging those developing countries which are beginning to accumulate capital to invest in those countries which are suffering from a lack of capital. The recent moves by UNCTAD to promote bilateral investment treaties among developing countries is particularly beneficial from this standpoint, and Japan is prepared to support the activities of UNCTAD in this field.

Mr. President,

So that the light of globalization may shine throughout the world, it is essential to extend a helping hand to those who are unable to ride this wave, whether due to structural reasons or because of temporary difficulties. I have every expectation that as a result of UNCTAD's activities we will not leave those people behind.

The Asian economic crisis which erupted in mid-1997 made the world painfully aware that, in the process of globalization, rapidly growing economies are also vulnerable and that the support system of the international community, which has prevailed in the last half century, was not necessarily adequate. Through the New Miyazawa Initiative and other programs, Japan extended support totaling about $80 billion to those countries that were faced with crisis, despite our own difficult economic situation. The recipient countries are now on their paths toward recovery, and I have been deeply impressed by the way they have demonstrated their wisdom and overcome their respective crises.

In order to prevent a similar crisis from occurring anywhere in the world, it is important to search for the causes of this last crisis while our memories are still fresh, and to continue our efforts to minimize the difficulties of globalization. Last year, the governments of Japan and Thailand jointly organized a symposium on this theme, and its results were submitted to the APEC Leaders' Meeting. Similar efforts should be continued by UNCTAD. Japan is willing to support such activities by UNCTAD.

Mr. President,

There is really a pressing need to extend debt relief to those countries that have been marginalized in the process of globalization and are suffering from extremely heavy burden of external debt. The G7 agreed at last year's Cologne Summit on an epoch making initiative to cope with this issue, which includes, among others, 100 percent cancellation of ODA claims. Now its early implementation is urgent. Japan, as this year's Summit chair, will make further efforts to accelerate implementation of this initiative with other G7 members.

Moreover, in addition to effecting a sizable reduction of bilateral claims, Japan has already made substantial financial contributions to the debt relief trust funds established in the International Financial Institutions. For the Cologne Initiative to be effective, it is imperative that the International Financial Institutions be provided with sufficient funds.

Additionally, I would like to emphasize that debt relief is not a panacea for resolving the problem of poverty in developing countries. From the perspective of their medium- and long-term development, it is crucial to strengthen our efforts to address the issue of development as a whole. In line with this Japan will continue to be committed to supporting those countries receiving debt relief with a full range of measures we offer in economic cooperation.

In Africa, where 33 out of the 48 countries identified as LDCs are concentrated, even though democratization and economic reform are proceeding, problems such as poverty, conflict, and refugees still abound. The international community should, as one of its highest priority tasks, support initiatives in Africa toward development. The Second Tokyo International Conference on African Development (TICAD II), held in 1998, recognized this in "The Tokyo Agenda for Action." In the future, cooperation between Asia and Africa will be particularly important and Japan is currently preparing to organize the Third Asia-Africa Forum, jointly with the United Nations.

The developing countries in landlocked or island areas are disadvantaged by insufficient economic opportunities. The UNCTAD Meeting of Governmental Experts from Land-locked and Transit Countries and Representatives of Donor Countries and Financial and Development Institutions, held at the United Nations headquarters last August, was unprecedented event in that it addressed fully these problems. Japan chaired the meeting and provided financial support for it. Moreover, from the Rio Conference on Environment and Development held in 1992 to last years UN Special Session for the Sustainable Development of Small Island Developing States held in New York, there has been active debate at the United Nations concerning the sustainable development of small island countries. Based on such discussions, Japan will host the Second Japan-South Pacific Forum Summit Meeting (PARM 2000) in April this year, inviting many leaders of island countries in the South Pacific region to consider what is required for these countries to overcome the difficulties of globalization.

Mr. President,

In the long history of the world, very few previous generations have experienced such rapid change. Our generation has the responsibility to ensure that this change benefits all the peoples of the world.

The G8 Summit meeting to be hosted by Japan in July of this year will be held at a major turning point, the year 2000. There is, therefore, a great expectation that the meeting should summarize the 20th Century and look ahead to the 21st Century. The goal of this meeting should be to seek ways to achieve a world in which all the people on this planet can share prosperity and enjoy a spiritual peace in stability, amid accelerating economic globalization and information-oriented transactions. I intend to ensure that this year's G8 will be truly fruitful, reflecting the discussing of this meeting.

I would like to conclude my speech my speech by sharing my hope with you that a genuine global prosperity can be brought about through combined efforts of developing countries fighting poverty and promoting development and the industrialized countries.

Thank you very much for your attention.