UNCTAD report makes the case for development-led globalization
7 February 2012: In his report to the 13th session of the UN Conference on Trade and Development (UNCTAD), UNCTAD Secretary-General Supachai Panitchpakdi has proposed replacing the pattern of finance-driven globalization (FDG) currently dominating international relations with a model of development-led globalization (DLG).
The report, titled "Development-led Globalization: Towards Sustainable and Inclusive Development Paths," suggests that FDG has led to uneven, unstable and unfair outcomes. It outlines an agenda for DLG based on three pillars: enabling developing countries to mobilize domestic resources, strengthen productive capacities and share the gains in an equitable manner; creating more robust multilateral structures for collective responses to upcoming challenges, such as taming finance and promoting investment-led responses to climate change; and strengthening regional ties, including through South–South cooperation, to enhance stability and open new growth opportunities.
The report outlines elements of a Global New Deal including: developing strategies to address debt; creating a new international architecture for aid that ensures inclusive development; turning trade and investment towards development; and developing principles for responsible agricultural investment.
Regarding the climate-development nexus, the report takes a critical stance towards market-based mechanisms for climate-change mitigation, such as cap and trade and carbon taxes, noting that they could work against development because they aim to increase the price for renewable energy sources to make them attractive for private investment. Instead, the report proposes a public investment push coupled with appropriate subsidies to overcome technological and scale hurdles.
The report concludes with a call for a normative agenda, based on a change of attitudes, morals and values, as an integral part of a strategy towards rebalancing the global economy and achieving a shift towards DLG. [UN Press Release] [Publication: Development-led Globalization: Towards Sustainable and Inclusive Development Paths - Report of the Secretary General of UNCTAD to UNCTAD XIII]