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A Critical Reflection on International Support for Least Developed Countries

April 23, 2020

New Commonwealth Secretariat International Trade Working Paper:

International support to least developed countries (LDCs) falls in the areas of trade, development cooperation and assistance with participation in the inter-governmental process. With 10 years of the 2030 Agenda to go, and before the fifth 10-year Programme of Action for LDCs starts in 2021, there is a need to re-evaluate the system of international support. Some LDCs are performing well, but key international targets have been missed. On average the contributions of trade and investment remain too low. Several LDC economies are contracting and becoming more vulnerable.

Taking a critical look at the theory and assumptions underlying international support makes it possible to propose new assistance mechanisms, as opposed to falling back on the mainstream position, which is implicitly based on the misleading premises that better international market access, aid and participation in existing multilateral processes will prompt spontaneous economic catch-up and sustainable development. Exposure to undistorted international prices will not alone drive the reorganisation of production or a move towards greater domestic efficiency. Duty-free, quota-free market access has benefited a select few countries. Official development assistance to LDCs is declining and may fall short of objectives.

As structuralists, developmentalists and others have long emphasised, governments and the international community need to promote active measures aimed at building productive capacity. In a power-based global system, developed countries and regions often shape the system of support for LDCs in their own interests – a recognition that is all the more important when commitment to multilateralism is faltering. Dependency theorists stress the importance of power relations and the interdependent nature of the global economic core and periphery. Rather than individual ad hoc assistance or promises of more aid, there is a need for deep-rooted, systemic improvement to the multilateral architecture relating to LDCs – driven by LDC governments themselves and differentiated according to context.

Acknowledging these ideas, this Working Paper proposes six areas of support, relating to the UN system, finance, trade, commodities, technology, and the environment and climate change. Each is accompanied by specific proposals that could be considered in the run-up to UNLDC-V and beyond.

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