PROSPECTS FOR A NORTH-SOUTH SUMMIT ON INTERNATIONAL ECONOMIC DEVELOPMENT AND CO

Created: 1/12/1981

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CENTRAL INTELLIGENCE AGENCY NATIONAL FOREIGN ASSESSMENT CENTER

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MEMORANDUM

PROSPECTSORTH-SOUTH SUMMIT ON INTERNATIONAL ECONOMIC DEVELOPMENT AND COOPERATION

Mexican Preeident Lopea Portillo haareat dual of peraonal preetige on tha auoeeaeful holdingmini-eummit"1 to diaouaa north-South aaonomio iaeuea. Deadlocked negotiationa on related mattera at the United nations, however, have dimmed the proapaotaonetruetive mini-eummit and may foroe lha meeting to be delayed or abandoned altogether. Moreover, the mini-aummit propoaal and initial preparationa threaten to further divide OECD eountriee and ieolate the United States on north-South iaau.ee, even from ita alliee.

The Sorth-South, mini-eummitey reaommendation of .the Independent Commieeion on International Development leeuee (the Brandt Commieaion) in Lopez Portillo and Austrian Chanoellor Kreiaky further andoraed the idea innd invitedoreign mtnietero to meet in Vienna in early Sovember to lay the groundwork. Inhe repreaantatioaa are aoheduled to meat again to eet the agenda, timing, and Hat of partioipanta for the mini-eummit. Dieagreement among the probable partiei-pante on theee three mattera, however, oontributea to uncertainty over whether the mini-eummit will be held.

The Brandt Commission Report

In former West German Chancellor Willy Brandt Announced that he was inaugurating an "Independent Coaualsslon on International Development Issues" to exaaln* "the grave global issues arising froa the econoaic and social disparities of the world community and to suggest ways of promoting adequate solutions to the problems Involved in development and In attacking absolutehe Commission was composed ofnternationally known economists, politicians, and other experts who could present viewpoints independent of established international institutions.

The report of the Brandt Commission was presented ints final reconnendation stated:

We believe that an eeeentialuoutd bemeeting uith lettdere from both

and developing nations. nanmit thould be limited to eome SS leadere oho could eneure fait* repreeentation of major aorld grouping a, to enablend oonoeeeion* to be thrashed out vith candor and boldneee. faW

The limited-participation summit was intended toew focus on global problems andew iapetus for future negotiations. The report acknowledged that the summit discussions could not be binding upon those countries not attending, but it expressed the hope thateeting could enhance the prospects for future action on North-South issues. aaaT

Nations

Brandt Commission report was received favorably by the world conmninity, but momentum behind th* Halted summit concept was slow to develop. This was due chiefly to tha primacy of ongoing debates in the United Nations on the global econoaic order. Th* General Assembly hald its Eleventh Special Session inith th* express purpose ofomprehensive econoaic development and cooperation program called tha Global Negotiations. The Global Negotiations war*o generate an integrated framework for international economic rotations forith special emphasis on the needs of developing countries, gflfj

Tho special session becaa* deadlocked over procedures and' agenda, however, and failed toecision onframework for the Global Negotiations. Th* Unitad States.by

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West Germany and the United Kingdom, opposed the text favored by the Group ofthe developing countries' UN caucus) because It could have reduced the autonomy of such UNagencies as the World Bank and International Monetary

Theh Session of the General Assembly then took up the issue of the Global Negotiations when it convened in mid-September. The president of the General Assembly, Ruediger von Wechmar,pecial interest in the Global Negotiations andelect group of UN Ambassadors to meet frequently as "friends of the president" in an effort to hammer out differences and work toward an acceptable agenda and procedure. As discussions dragged on thioughout the autumn session, four positions emerged:

0 The non-oil-producing LDCs favored an agenda that would give the General Assembly broad authority to discuss the entire range of North-South issues in great detail. This implied that the General Assembly could oversee and direct specific programs of the autonomous, specialized agencies.

0 Some OPEC countries favored an agenda that would submerge issues about which they felt defensive, such as energy,road global context,to non-detailed discussion without reference to specific programs or institutions. The General Assembly would retain the central authority to guide the negotiations but not to make docisions.

0 The Uuited States advocated an agenda that would permit the General Assembly toore narrow range of North-South issuesery general nanner. The United States insisted that the General Assembly not interfere with the autonomy and integrity of the specialized agencies.

The European Community proposed an agenda that would specificallyroad range of issues but would delimit the authority of the General Assembly to take action on only thosethat could ba reached through consensus.

Von Wechmar had hoped that his "friends" would be able toompromise by the third week in November. The

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General Assembly could then approve the agenda and procedures for the Global Negotiations, which could begin deliberations in Hell before Von Hechmar's deadline, however, it became apparent that no agreement would be reached and that the momentum behind the Global Negotiations had dissipated.

The Kreisky-Loocz Portillo Initiative

In early October, during the general debate in the

General Assembly, Austrian Foreign Minister Pahr recalled

the Brandt Commission proposalorth-South sumiiit and suggested thatevice could rekindle interest in the deadlocked North-South debate. ummit had already been discussedtate visit to Austria by Mexican President Lopez Portillo.

orth-South summit was not explicitly linked

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3 the UN debates, the timing and circumstances of Pahr's peech indicated that the summit concept was becoming an integral part of the Global Negotiations process. The sunnit came to be viewedevice to prime discussions on North-South issues by establishing an atmosphere of The mini-summit furthermore would .facilitate and sustain interest in the Global Negotiations. tfjfgT

Shortly after Pahr's speech, Kreisky invitedoreign ministers to meet in Vienna to discussorth-South summit. Some basic ideas forummit had already emerged:

It should be held outside of the formal United Nations framework.

Attendance should be at the head of government or head of state level.

Participation should be restricted tooountries, representative of various geographical regions and degrees of economic development.

The summit should make no decisions, but Instead focus attention and action on the most vital issues of North-South relations and lend impetus to tbo Global Negotiations process.

a The summit would be held in Mexico, at the

invitation of President Lopex Portillo, sometime

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Attending tho Vienna meeting in November vere the foreign ministers, or their representatives, from Algeria, Austria, Canada, the Federal Republic of Germany, France, India, Mexico. Nigeria, Tanzania, Venezuela, and Yugoslavia, Although this group endorsed the mini-summit in principle, agreement could not be reached on the specific details of the agenda and riming. Theepresentatives, therefore, agreed to reconvene Innd attempt to draw tip the invitation list, agenda, and timingini-summit. Few of the prospective participants have subsequentlyunequivocal commitment to the North-South summit; most have made the satisfactory resolution of the agenda and timingrecondition for their attendance. Failure toonsensus on these issues would seriousl;'the proposed meeting.

When theoreign ministers reconvene, one of the first orders of business will be toinal decision on the list ofoeaders to be Invited. Emphasis will be placed on selecting leaders who represent the various viewpoints of developed countries, OPEC, and non-oil LDCs. There already appears toreliminary list ofountries.

Big Five: US, UK, France, West Germany, Japan.

Other developed countries: Austria, Canada, Sweden.

Asia: Bangladesh, India, Philippines, Saudi Arabia.

Africa: Algeria, Ivory Coast, Nigeria, Tanzania.

America: Brazil, Guyana, Mexico, Venezuela. 1st: Yugoslavia. USSR, China.

The USSR and China were added as an afterthought, in recognition of thoir importance in the world community. The assumption was that both would decline to attend on ideological grounds, but tho USSR now has Indicated that it will reluctantlyini-summit invitation* Should tho Soviet premier accept an invitation to attend the summit, his Chinese icounterpart might also feel compelled to attend. Some organizers fear that the effect of both Communist countries attending would bo to shift attention to Sino-Soviet differences ert East-West Issues into the North-South discussion?.

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But

hose two additional OECD countries were invited, reciproc would require that two more LDCs be included. Not only would this risk upsetting the balance between geographical regions and between OPEC and non-oil-producing LDCs, the addition of four more participants would also increase thef the summithich the mini-summit cosponsors consider too large to be effective.

As ln the discussions in New York over thc Global Negotiations, there is no agreement on how specific tho mini-summit agenda should be. As host, Lopez Portillo favors an unstructured meeting which would not discuss specific issues or events but rather stimulate an atmosphere of good-will and cooperation among the key global leaders. Turning the summitype of "rap" session has two advantages. First, it may be unrealistic in any case to expect the heads of government or state to restrict their discussionsiven agenda. Second, and more important, an unstructured summit permits leaders to attend who might otherwise avoid the meeting if especially sensitive issues are explicitly listed on the agenda. Thus, Saudi Arabia and other OPEC states might refuse to attend if the issue of energy price and supply was mentioned specifically. the OECD nations might shy away from the summit if the international monetary system was singled out for discussion.

The concepteneral open-ended agenda, however, alsorawback. Many countries fear that unless discussion is focused on specific issues the summit will degenerate into recrimination and polemics. The United States has already voiced this fear and stated that it was not disposed toeneral "gripe" session at which the United States and the other industrialized countries would be blamed for all of the real or imaginary ills of tho Third World. In addition, should China and the USSR accept the invitation, an unstructured agenda would Increase the chance of an East-West confrontation at what was designed toragmatic exercise to ease the North-South impasse, fj

Timing

The final matter that will have to be addressed is timing. The initial timetable discussed at Vienna in

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November Assumed that the first round of the length/ Global Negotiations would begin innd that the mini-summit would be hold after that round. Therefore the "window" for the mini-summit ran from mid-March to September, whenh Session of the General Assembly convenes.

There were other considerations, however, which narrowed this window considerably. First, tho Third World ministers insisted that tho summit should bo held before the OECD Big Seven Summit scheduled for July in Ottawa. They hoped not only to upstage the Ottawa summit but also to make OECD coordination prior to the mini-summit more difficult. Second, France would notorth-South summit until after its Presidential elections in April. Finally, theinisters in Vienna wore acutely aware that US partl<lpation in the mini-summit was essential if the meeting were to be successful. Realizingew American administration would be assuming power in January, they agreed that the mini-summit should be held at the last possible moment before the Ottawa summit to give the new American President the maximum amount of time to settle into office. The resultarget of the first two weeks in June, with the exact dates to bo set at the March meeting of the organizingaThat target has since become increasingly unrealistic,.

Prospects /or tho Sumnit

For the summit to be held at all, the demands of the following key countries or groups must be met.

" The United States has stated thatwill notini-summit unless

there is convincing evidence that the meeting will be constructive. At the least, this requires that the agenda be structureday to minimize polemics andutual exchange of ideas and proposals that could later be embodied ln concrete programs.

Arabia would probably not participate if thereeal chance that specific recommendations would emerge or that energy

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rlca and supply were singled out for discussion, he other oil-producing nations (Algeria, Nigeria, and Venezuela) probably wouldimilar position.

and Yugoslavia insist that tho North-South summit be directly linked to the Global Negotiations process of the United Nations;he mini-summit could fragment the

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Croup ofnd reduce tlie power of thoir majorily ;it the IIN. If the mini -sunnti l tamo to he viewed -is nil alternative forum to thc Clohal Negotiations, these key Third World countries probably vould not attend, fl

ill>', hcc.msc theas become inexorably linked to the Cloh.il Ncgotiut ions, It* future is oven more uncertain than if it were being considered on its own merits. The 3Slh session of the UN General Assembly recently recessed for the winter holidays without acting onobal Negotiations issue. It will retonvene in January, but tho difficulties encountered to date make it improbable thatompromise can he found until Mirch, or perhaps as late May. This logically would pusl the mini-summit schedule back to well after the Ottawa si.mmit. That would be unacceptable to the LDCs and might interfere with preparations forh Ceneral Assembly session, which begins in September. flflflB

Thus, the first real opportunity for tho mini-summit would be inoncurrent with the Ceneral Assembly, or in By that time the Global Negotiations will probably either haveomentum of their own or will have collapsed altogether. In either case, the mini-summit would have lost its relevance. fl

Lopez Portillo, however, hasood deal of personal and political prestige on successfullyorth-South summit meeting. If thc Global Negotiations appear hopelessly stalemated, he might attempt to once again disassociate the mini-summit from UN discussions andumber of countries to participategetting-to-know-you" conference. eeting could still be held arounu the original June date. Furthermore, the discussions could take place at tho level of foreign ministers or personal representatives. That would reduce the imperativeroductive debate but increase the possibility ofummit turningeneral donnybrook, resultingprimarily in assigning guilt for the North-South deadlock, fl fl

To Attend or Not to Attend?

If Lopex Portillo decides to convene awhatever tho level of representation, eachwill havo to decide whether or not tofactors will influence attendance: tho state

relations with Mexico, the need to maintain unity among nations with similar Interests, and thc perception of the general direction of the North-South dialogue. fl

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Because* Lopoz Portillo has placed so much personal prestige on the successecision not to attend the meeting could create serious problems for that country's bilateral relations with Mexico. The other Latin American countries, especially Brazil and Venezuela, which are known to be indifferent to the ideaummit, probably would accept rather than risk offending the president of an important Latin American country. India, too, would not want to risk endangering relations with Mexico, from which it recently has begun importing oil.

The potential impact on bilateral relations with Mexico is especially problematic for the United States. Because US participation inummit is deemed essential fo* its success, non-participation could affect the wholef issues which make up US-Mexican relations--from energy to immigrants. Yet, if Washington were to accept an invitationonference which turnedgripe-session" aimed against it, the United States still would be cast as theesult that could also seriously damage thc US image. | |

A second factor that will shape the responseummit invitation is the individual country's relations with the members of its own bloc or group. Some nations in the Group ofrobably fear that the industrialized states will use the mini-summit to "divide and conquer" the Third World. Some of the more radical members of the Group ofrobably would oppose any meeting that would strain the group's already tenuous unity. OPEC countries also mightanger to their unityimited participation summit. Only four OPECNigeria, Saudi Arabia, and Venezuela--appear on the list or potential participants. Given OPBC's lack of cohesion, these four states will undoubtedly weigh participation in the summit against the likelihoodealous reaction from those OPEC members not invited.

Tha industrialized countries, too, will have to consider the potential consequonces of attendance on cooperation in the OECD. Chancellor Schmidt already has spokenaboutorth-South mini-summit. Prime Minister Trudeau also has expressed support foreeting. These two Western leaders apparently are sufficiently committed enough to the summit idea that they would attend regardless of US participation. This would place the British, French, and Japanese leaders in the uncomfortable position of having to choose sides. Should all Big Six OECD countriesummit, internal relations within the organization still could be strained. Some smaller OECD countries already have voiced concern that they ore being phased out of OECD

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decision-making by the six most powerful members. by the Big Six in yet another economic summit would onlyserve to heighten the anxiety of these smaller allies.

ountry's standing in the overalldialogue will greatly influence itsini-summit. In recent years, many of thecountries that were initially cool tohave come to side with the Group ofn aNorth-South issues.

In the course or tho next year or two,

Washington will probably find itself increasingly isolated on certain aspects of North-South economic cooperation. Not only wouldevelopment focus considerable pressure on the US in bilateral and multilateral forums, it would also further strain political and economic relations withstates, alliance partners, and Third World countries.

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