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The
G8 Summit of 2005 concluded deciding to relieve
the least developed African countries of their debts;
double the aid provided to those countries from
the present US$ 25 billion to US$50 billion; work
for a more improved market access and help them
fight against AIDS.
Debt relief is a significant means for poverty reduction
since debt and poverty sometimes move in a vicious
circle with poverty leading to debt and unsustainable
debt further perpetuating poverty. Therefore, it
can be a crucial means to achieve the Millennium
Development Goals (MDGs) target of halving poverty
by 2015 if it is linked to development by focusing
on sectors that would generate employment and revenue
and are also critical for the people. But why only
African poverty? Are the least developed countries
(LDCs) of Asia and the Pacific not poor to the extent
so as to be privileged by what the G8 leaders have
determined? If poverty is to be made history not
only in Africa but in the whole world, some concrete
plans of action, if not exactly similar to what
has been decided in the G8 Summit for the African
countries, should be devised for other poor countries
as well. Providing productive assistance along with
improved and unconditional market access can be
a crucial factor in that regard.
Developing a global partnership for development
is the eighth goal of the MDG under which there
are seven targets to meet. Of those targets, target
13 is about addressing the special needs of the
LDCs that include tariff and quota free access for
LDC exports, among others. But Nepalese textiles
still face tariffs of about 25 per cent in the US.
Even in the EU where LDCs are given preferential
market access under the Everything But Arms (EBA)
initiatives, such access is not unconditional. There
are stringent 'Rules of Origin' (RoO) and other
measures, like the Sanitary and PhytoSanitary (SPS)
and Non tariff barriers (NTBs), to comply with to
take advantage of such access. This shows that the
developed countries are not fully committed to pull
the world out of the poverty trap.
Even if unconditional market access is provided
to the LDCs, they cannot take advantage of it because
of their capacity constraints. The real need of
the LDCs, therefore, is to help them build their
capacities and make them competitive. And for that
to materialize, these countries are in need of assistance
of various forms and degrees. In the Millennium
Summit held in September 2000, the developed countries
had pledged to provide 0.7 percent of their gross
national income (GNI) as official development assistance
to the developing and the least developed countries
to achieve the MDGs. But even to date, the US has
been spending a mere 0.15 percent of its GNI on
aid, whereas its expenditure on the military is
nearly 5 percent of its GNI. On top of that, the
assistances that the developed countries have provided
so far and have pledged to provide in the future
are in the forms of providing trainings, conducting
seminars, workshops, and surveys. It cannot be denied
that the developing and the least developed countries
need these types of technical assistances so as
to build their capacity to participate effectively
in trade negotiations. However, more importantly,
they are in need of assistances for the development
of infrastructure and technology transfer. Without
assistances in these areas, the LDCs have to continue
facing market barriers because of the agreement
like SPS and TBT of the WTO. In that case only providing
market access would tend to show the generosity
of the developed countries to the least developed
and the developing ones; it will not reflect the
willingness of the former to help the latter integrate
with global trade.
What is the benefit of providing technical assistance
only to enhance the capability of the human resource
to a country like Nepal unless its supply side competitiveness
is enhanced? No doubt, capable human resource is
a pre requisite to participate effectively during
negotiations but the country cannot benefit substantially
from such negotiations unless its supply side constraints
are addressed. The same applies for market access
as well. Therefore assistances in all forms that
Nepal requires at the moment is for increasing its
productive capacity; and that can be achieved by
building adequate infrastructure in the hardware
part and by enhancing capacities of its human resource
in the software part. In the absence of balanced
assistance in both software and hardware, Nepal
will not be able to implement different WTO agreements
on safeguards, TBT and SPS measures, Trade Related
Aspects of Intellectual Property Rights (TRIPS),
and the like. The financial and technical resources
for complying with WTO are high and beyond the resources
of the country. That is to say that the country
shall never be able to take full advantage of its
membership to the WTO unless assistances are provided
in real terms. That would mean that the nation's
objective of reducing poverty through its integration
with global trade would remain a distant dream,
not to mention the MDG target of halving poverty
by 2015. |
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