Rethinking Bretton Woods | Tue, Apr 14, 2009
The UN Conference on the world financial and economic crisis and its impact on development is now scheduled to take place from June 1 -3, 2009. The agreement on the date is part of a number of agreements on modalities contained in a modalities resolution of the UN General Assembly. The agreements were finally reached after protracted negotiations that revealed a continued conflict of views, mostly along developed and developing country lines, regarding the role that the UN is called to play on issues of financial reform.
The call for the conference was the most contentious point in the outcome of the Doha Review Conference on Financing for Development held last year. The resolution on modalities was supposed to be agreed by end of March but the difficulties to reach agreement account for the delay of about a week.
The demand came at a pivotal time when the global financial crisis, while started in the US, was reaching systemic proportions. Developing countries insisted on a paragraph of the Doha Outcome Document that would call for a major conference to "review the international financial and monetary architecture and global economic governance structures." As those negotiations were underway, a proactive new president of the General Assembly, just arrived into his office, decided to form a Commission of experts that included current and former government officials with recognized economic expertise, chaired by Joseph Stiglitz, to provide a substantive input and ensure the conference would not be confined to diplomatic platitudes, but rather engage on deeply technical issues.
Almost in parallel, then-US President George W. Bush convened Heads of State of the Group of 20 in Washington with the purported goal of coordinating their response to the financial crisis. Some member states argued decisions on reform of global finance should be left to that forum. But deliberations in Doha emphasized that the G20 could certainly not be considered to override the "G192"-that is, the meeting of all nations in the only forum where they could be convened: the United Nations. Indeed, the fact that some matters were undergoing debate in the G20, while this is an important forum for coordinating positions among its members, cannot be a legitimate reason to preempt such discussions in an intergovernmental body like the UN. Doing otherwise would be tantamount to placing on agreements by the G20-a self-selected group of countries with not even legally-agreed and permanent operating procedures- equal status as those by the UN.
The conference is being called "at the highest level", which reveals continued divisions about the need to hold the conference at the Summit level. However, as announced in a press release, the Group of 77 countries and China have already pledged full participation and the President of the General Assembly, Mr. d'Escoto, has visited and plans to visit a number of countries to build support for participation at the Head-of-State level.
According to the resolution the conference, to be held at the UN Headquarters in New York, will consist of a short opening session; plenary meetings and four interactive round tables, and will result in a "concise outcome to be agreed by Member States."
The resolution requests the President of the General Assembly, through an open, transparent and inclusive process led by the Member States, to present in a timely manner a draft text based upon all preparatory inputs to serve as the basis for an outcome document, to be agreed by the Member States.
It also entrusts the Secretary-General to prepare a report on the origins and causes of the present crisis, the mechanisms of its transmission to the developing countries, the potential impact of the crisis on development, the response of the United Nations to the crisis through its development activities and national and international policy responses to date.
Importantly, the conference will bring together not only all 192 member states but also, in a multi-stakeholder manner, United Nations funds, programmes and specialized agencies, the Bretton Woods institutions, the World Trade Organization, the regional development, banks, the regional commissions of the United Nations, as well as non-governmental organizations and civil society and business sector entities.
The first chance to begin deliberations towards the conference will take place at the special high-level meeting of ECOSOC, the Bretton Woods Institutions and the WTO. Usually focused on the follow up to the Financing for Development Process, this year the dialogue will address the main topic of the conference and provide a summary of discussion to be used as an input to the preparatory process for the draft outcome document of the Conference. (A second topic in the dialogue, though not referred in this resolution, will be initial discussion to strengthen the follow up process to Financing for Development).
Click to see Press Release by the Office of the President of the General Assembly
Click to see the resolution.