I am honoured to introduce to you the Report of the Secretary-General on agenda item 22 (b) contained in document A/66/205 that you have before you. The Report takes stock of the progress made and constraints faced in the implementation of the Almaty Programme of Action, in particular in its five priority areas of (i) fundamental transit policy issues, (ii) infrastructure development and maintenance, (iii) international trade and trade facilitation, (iv) international support measures and (v) implementation and review. The Secretary-General then puts forward important recommendations to which I would like to draw the attention of delegations.
The fundamental characteristics of landlocked developing countries, including remoteness from major international markets, inadequate transport infrastructure, cumbersome customs and border crossing procedures and high transport and trade transaction costs continue to put them at the margin of the global economy and at a disadvantage on their development path. Based on balance of payments data from the International Monetary Fund, UN-OHRLLS made an attempt to estimate the magnitude of the transport and trade transaction costs that LLDCs incur. The estimates show that landlocked developing countries as a group have a higher proportion of freight charges to total value of exports and imports of 45 percent more than the group rate for transit developing countries. These are diverted resources that could be invested in building their productive capacities. The establishment of a secure and efficient transit transport system is critical to reduce transport costs and enhance the competitiveness of their exports.
Let me proceed in this regard by first reviewing economic and social performance of the LLDCs over the past year before touching upon the priority areas of the Almaty Programme. The United Nations Department of Economic and Social Affairs estimated that economic growth for the LLDCs was around 5.8 percent in 2010 indicating that their economies are on their way to recovery from the low of 3.6 percent in 2009. Although this growth rate is improving, it is generally lower than pre-crisis rates and it remains subject to several risks and uncertainties. Given the vulnerability of the economies of this group of countries to external shocks, it is only prudent for them to remain vigilant.
In this regard, this report recommends that LLDCs, supported by their development partners, should strategically improve their productive capacities, diversify their economies and strengthen their transport systems to become more efficient. The report also recommends that international organizations and other research institutions should undertake research on the vulnerability of LLDCs to external shocks and develop a set of vulnerability indicators that can be used for early warning purposes.
With regard to social development, continued progress has been made towards achieving some of the MDGs especially primary school enrolment, gender parity in primary education and women’s representation in national parliaments, combating the spread of HIV/AIDS and increasing the proportion of people with access to improved water source. However major challenges still remain. The population of those living in hunger in LLDCs is still relatively high. The geography of LLDCs makes them more vulnerable to rising food prices because of high transport charges. Climate change continues to pose an additional threat to their sustainable development. Landlocked developing countries are also vulnerable to natural disasters such as the zud (severe winter) disaster that affected the Mongolian economy during 2009-2010 resulting in the loss of over 10 million heads of domestic animals; and the recurrent droughts in the Sahel region that affect many landlocked developing countries. Strengthened international support to LLDCs through increased ODA is critical for enabling stepped-up efforts to achieve the MDGs.
At this juncture, allow me to provide highlights of the efforts that have been undertaken in the five priority areas of the Almaty Programme of Action. With regard to the priority area that calls for landlocked and transit developing countries to fundamentally review transit issues, continued progress is being made in streamlining administrative procedures and simplifying border control procedures. One stop border controls have been established on several border posts along the transport corridors in Eastern and Southern Africa and, most recently, in Western Africa. Initiatives are underway in MERCOSUR countries of South America to apply integrated controls on their border points. In the Asian region, implementation of single-stop inspection and single-window inspection points are part of the sub-regional Cross-Border Transit Agreements. The initiative of the one-stop-border control has clearly proved to be effective and should be replicated. Other initiatives that facilitate cross border movement of vehicles and reduce transit time include a yellow card system which is a motor vehicle insurance scheme established by COMESA member countries in Africa; the white card system also a motor vehicle insurance scheme being developed in the Economic Cooperation Organisation (ECO) region and the common visa sticker for drivers developed and adopted in the ECO region, the use of ICTs for customs clearance, and the increased establishment of dry ports in many landlocked developing countries.
At the regional and sub-regional levels, substantial progress has been made in developing agreements where LLDCs and their neighbouring countries are pursuing harmonisation of transport and transit policies, laws, procedures and practices with transit countries. Asia has made substantial progress in developing and implementing the Inter-governmental Agreements to underpin the Asian Highway Network and the Trans-Asian Railway Network. In Africa, progress is being made towards developing an intergovernmental agreement on the Trans-African Highway. My Office in collaboration with the Economic Commission for Africa, and the African Union Commission recently organized an expert group meeting that elaborated on the text of the draft intergovernmental agreement on the Trans African Highway. The first text of the draft intergovernmental agreement will be presented for consideration to the conference of African Transport Ministers in November 2011.
Let me also take this opportunity to highlight that at the international level, there are 57 international conventions and agreements that provide frameworks for harmonisation and simplification of transit formalities and procedures. Their effective implementation can significantly support landlocked developing countries’ access to the sea. However ratification of these conventions by the landlocked developing countries and their transit partners has been slow. This report therefore encourages landlocked and transit developing countries to ratify and effectively implement international conventions and agreements.
With regard to the priority area on infrastructure development and maintenance, in all the regions, some progress has been made in upgrading and expanding the transport infrastructure. However the major challenge remains inadequate resources to invest in the missing links and maintenance of the existing infrastructure. Landlocked developing countries have also made remarkable progress in improving telecommunication infrastructure, particularly cellular phones and internet connectivity. As a group, they recorded an increase of 25 percent and 37 percent in cellular phones and internet usage respectively from 2008 to 2009. This has been made possible through increased private sector involvement.
Energy which is vital for reducing delays in transit time for landlocked developing countries’ consignments, is still insufficient and unreliable in many LLDCs. It is therefore important for LLDCs to harness domestic and external resources and encourage increased partnership with the private sector to meet the energy infrastructure financing needs. Action to strengthen energy infrastructure at regional and sub-regional levels is also essential.
With regard to trade, I would like to underscore three key issues. First, despite some progress that has been made in enhanced integration of landlocked developing countries into the global trading system, only 22 of the 31 landlocked developing countries are members of the World Trade Organisation. Landlocked developing countries that are in the process of accession need continued support so that they can obtain the benefits of becoming members of the WTO.
Secondly, the proportion of merchandise exports of landlocked developing countries to total world exports has remained below one percent. Although it had increased to 0.96 percent in 2008 it then fell to 0.75 percent in 2009. Despite the sub-regional preferential trade agreements that most landlocked developing countries are now part of, intra-regional trade is not growing fast. It is important that these agreements and other strategies to boost intra-regional trade are implemented so as to expand trade opportunities for landlocked developing countries.
This brings me to the third trade related key issue that this report underscores, trade facilitation. Enhanced trade facilitation is a major step that can reduce the costs of trading and boost trade for landlocked developing countries. According to recent research, every extra day required to clear goods for import or export decreases trade by around 4%. The successful conclusion of the Doha Development Round is therefore of utmost importance to the landlocked developing countries, in particular in the area of trade facilitation, to ensure their unhindered access to and from the sea and to reduce transit time and cost.
In the priority area of international support measures, flows of ODA from traditional donors have continued to increase from $18.9 billion in 2007 to $24.8 billion in 2009. The flow of Foreign Direct investment to LLDCs experienced a decrease due to the global financial and economic crisis in 2009. However with some recovery in some of the capital exporting countries, FDI is expected to improve particularly in resource-rich LLDCs. The report encourages capital exporting countries to adopt policies and incentives that encourage FDI flows to LLDCs and requests LLDCs to promote an enabling environment to attract FDI.
Some landlocked developing countries greatly benefited from debt relief support provided through the Heavily Indebted Poor Countries Initiative and the Multilateral Debt Relief Initiative. There has been a continued increase in Aid for Trade disbursements to LLDCs, which rose from $4.7 billion in 2008 to $6 billion in 2009. This is an important trend to maintain as Aid for Trade flows form crucial resources to building productive capacity, infrastructure development and maintenance and capacity building. Landlocked developing countries have also benefitted from support through South-South cooperation.
This report also showcases the efforts being made by the United Nations system and other international organizations in implementing the Almaty Programme of Action.
The UN-OHRLLS continued to strengthen its efforts to assist landlocked developing countries through increased mobilization of international and United Nations system-wide support and awareness-raising activities. UN-OHRLLS in cooperation with the UN Office of Legal Affairs supported the Group to elaborate a Multilateral Agreement on the Establishment of the Think Tank which is now open for signature. I wish to congratulate the LLDCs that have already signed the agreement namely; Mongolia, Paraguay, Ethiopia, Niger and the Laos Peoples Democratic Republic. A minimum of ten signatures is required for it to become operational so we still need at least five more. In this regard, I wish to call on all of the Governments of the LLDCs that have not yet done so, to come forward and sign and ratify the agreement. The think tank will provide a centre of excellence for high quality research and policy advice and will contribute to further strengthening of the analytical capacities of LLDCs.
Allow me at this point to focus on the priority area - implementation and review. As you all know, we are now approaching the end of the first decade of the Almaty Programme. It is essential to undertake a comprehensive assessment of the implementation of the Almaty Programme so as to identify the major achievements, lessons learnt, as well as outstanding and new-and-emerging challenges - elements that are critical in developing a new agenda to assist the LLDCs in the next decade. In this regard, as called for by the General Assembly in its resolution A/RES/63/2, this report of the Secretary General requests this session of the General Assembly to consider convening the conference to comprehensively review the ten years of implementation of the Almaty Programme of Action. The Conference should be preceded by sub-regional, regional and substantive preparations in a most effective, well-structured and broad participatory manner.
Let me conclude by referring to the outcome of the recently held 10th annual Ministerial Conference of Landlocked Developing Countries. The outcome of the meeting clearly shows that much more needs to be done as the LLDCs are still experiencing very high transport and transit costs and remain marginalized in international trade and vulnerable to multiple global crises. This session of the General Assembly provides us a good opportunity to strategize how to enhance the assistance to these geographically disadvantaged countries to enable them to adequately harness the benefits of trade for their development.
I thank you for your attention.