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FOR OFFICIAL USE ONLY DC/99-16 August 12, 1999 RECORD OF DISCUSSION OF THE FIFTY-NINTH MEETING OF THE DEVELOPMENT COMMITTEE Chairman: Tarrin Nimmanahaeminda, Thailand Washington D.C. April 28, 1999 Contents Page No. Speakers ............................................................................................... i Plenary Session Introductory Remarks by the Chairman............................................ 1 Statement by the Director-General of the World Trade Organization ............................................................. 2 Statement by the President of the World Bank ................................. 3 Statement by the Managing Director of the Fund............................. 6 Statement by the Chairman of the Group of Twenty-Four ............... 9 Chairman’s Summary of Main Points Made in Ministers’ Circulated Statements .................................................................... 10 Prepared Statements Circulated by Members ........................................................... 14 Prepared Statements Circulated by Observers .......................................................... 110 Annex A Agenda .............................................................................................. 126 Annex B Communiqué..................................................................................... 128 Annex C List of Participants ............................................................................ 132 * * * This document has a restricted distribution and it is requested that it should be used by recipients on a similarly restricted basis and not be published, quoted or cited. i Speakers Page No. Chairman................................................................................................................... 1 Mr. Ruggiero............................................................................................................. 2 Mr. Wolfensohn ........................................................................................................ 3 Mr. Camdessus.......................................................................................................... 6 Mr. Peiris (Chairman of the G-24)............................................................................ 9 Statements by Members Mr. Abdul-Karim (Bahrain) ....................................................... 14 Mr. Al-Assaf (Saudi Arabia)............................................... 16 Mr. Aninat (Chile) ........................................................... 19 Mr. Evans * (Australia) ..................................................... 21 Mr. Fazio * (Italy)............................................................. 24 Mr. Gurría-Treviño (Mexico)........................................................ 27 Ms. Herfkens * (The Netherlands) ......................................... 30 Mr. Imboden (Switzerland)................................................. 35 Ms. F. Johnson (Norway) ....................................................... 40 Mr. Ketso (Lesotho) ....................................................... 46 Mr. Kuroda * (Japan)........................................................... 52 Mr. Jalan * (India)............................................................ 55 Mr. Jin * (China) .......................................................... 58 Mr. Malan (Brazil) .......................................................... 61 Mr. Martin (Canada)........................................................ 64 Mr. Maslukov (Russia) ......................................................... 68 Mr. Niamien (Côte d’Ivoire)............................................... 75 Mr. Oualalou (Morocco)...................................................... 79 Mr. Othman (Malaysia) ..................................................... 81 Mr. Rubin (United States)............................................... 85 Ms. Short and Mr. Brown (United Kingdom)......................................... 93 Mr. Strauss-Kahn (France) ......................................................... 97 Mr. Viseur (Belgium) ...................................................... 102 Ms. Wieczorek-Zeul (Germany) ..................................................... 106 Statement by Observers International Fund for Agricultural Development (IFAD) ....................................... 110 Islamic Development Bank....................................................................................... 111 United Nations .......................................................................................................... 117 International Labour Office............................................................................ 120 United Nations Commission for Trade and Development........................................ 122 ____________________ *Alternate 1 RECORD OF DISCUSSION OF THE FIFTY-NINTH MEETING OF THE DEVELOPMENT COMMITTEE The Joint Ministerial Committee of the Boards of Governors of the World Bank and the Fund on the Transfer of Real Resources to Developing Countries – the Development Committee – held its fifty-ninth meeting on April 28, 1999, in Washington D.C. The meeting comprised a short plenary session and a restricted session. The members circulated their statements in advance. The plenary session started at 9:05 a.m. Introductory Remarks by the Chairman The Chairman made the following introductory statements: Distinguished members of the Committee, Mr. Ruggiero, Mr. Wolfensohn, Mr. Camdessus, ladies and gentlemen, it is my privilege to call to order the 59th meeting of the Development Committee. I would like to welcome the members and their delegations and extend special greetings to our new members, to the new Chairman of the G-24 and to the observers of the Committee. We have a very full schedule today. So I think we should get right down to business. First is the adoption of the agenda. Ladies and gentlemen, the provisional agenda for the meeting has already been circulated, and I assume that we can take that agenda as adopted. So the agenda is adopted. The second business is arrangements for the meeting. Please allow me to summarize briefly the arrangements for our meeting today. In a moment, I will ask Mr. Ruggiero to address us. We shall then hear from Mr. Wolfensohn, Mr. Camdessus and Minister Peiris, the Chairman of the Group of Twenty-Four. After that I will report on the main points from the members' prepared statements, which have already been circulated to your delegations. The restricted session will then follow from about 10:00 a.m. to 12:30 p.m. in the Fund Board Room on the twelfth floor. Then, we shall focus on agenda items 1.A, the Heavily Indebted Poor Countries' Debt Initiative and 1.B, Principles and Good Practice in Social Policy. At the end of that session, just before we break for lunch, we shall hear a brief report on the special Bank-Fund meeting on the Kosovo situation, held yesterday evening. The luncheon for members will be held on the second floor in Room 2-530 from about 12:45 p.m. to 2:30 p.m. Then Mr. Wolfensohn, Mr. Camdessus and I will have a press conference in Room B-702 at 3:45 p.m. Of course, as usual, interested members of delegations are welcome to attend. In just two days, the Director-General of the World Trade Organization, Mr. Renato Ruggiero will complete his term. He has been a tireless advocate for a strengthened international trading system and for the importance of trade expansion to sustain economic growth and development. Thus, I am particularly pleased that we have this opportunity to benefit once again from Mr. Ruggiero's experience, wisdom and advice. 2 Statement by Mr. Renato Ruggiero, Director-General of the World Trade Organization. The world economy is vastly more open, integrated, and competitive today than it was fifty years ago when the Bretton Woods institutions and the GATT were created. Twenty-five percent of global output is now traded internationally, and national economies are increasingly tied together not only through trade but through foreign direct investment and international capital markets as well. As globalization advances, the task of managing the international economic system successfully becomes more essential, but it also becomes more complex. It necessitates much closer cooperation in designing and implementing mutually supportive trade, financial and development policies than was the case in the past. The IMF, the World Bank and the WTO have special responsibilities to meet this challenge, and increase the coherence of global economic policy-making. The financial crisis and its aftermath have dominated the international economic agenda for the past two years. If it had erupted onto a systemically weak trading system, the consequences would have been unimaginably worse. The WTO has been a pillar of strength and stability for the global economy as the depth and extent of the financial crisis has unfolded. It is functioning well and effectively, and has given governments and the private sector confidence that the situation, while deeply worrying, can nonetheless be managed. Steady integration of the world economy has seen stronger and more sustainable growth taking hold throughout the developing countries, leaving their economies generally in much better shape to confront the current economic difficulties. The crisis has led to a huge and complex process of economic re-adjustment taking place, not only in the crisis-hit countries but globally. Many basic and traditional relationships have been disturbed. One example