Mr. President: We are grateful to the Government and People of the Royal Kingdom of Thailand for the grace, elegance and efficiency of the arrangements of this Midterm Review Conference of UNCTAD X. My delegation is confident that under your able leadership and the fabled Thai wisdom, our discussions will yield useful ideas and clear insights on how UNCTAD can become more responsive to the  development needs of its members.

 Yesterday, Prime Minister Thaksin Shinawatra presented a very interesting and innovative approach to meet the challenges of globalization; he called it the “inside-out” approach, that would encourage public participation at every level of the policy process. He described a two-track development strategy that would establish external linkages between Thailand and  the global trading system parallel to the  authentic development of the Thai economy at the grassroots level. If my friend, the Prime Minister, will permit me, I would like to expand a little further on his inside-out model.

 Mr. Chairman: Like many developing countries represented in this room, the Philippines has sought a formula to make trade liberalization yield benefits for the larger majority of our citizens.   However, our experience thus far gives clear evidence that globalization has not delivered its promised prosperity.  The Philippines lies nestled in the bosom of the East Asian growth area, and yet vast numbers of our people continue to suffer from poverty and deprivation.

 This is our development challenge; I am sure that for many of us gathered here poverty is the foe we all seek to vanquish and we hope trade, finance, and investment are the effective weapons.

 The Philippines wants development. Today, the people of our villages – our farmers and our fisherfolk – face a bleak future. No money, no training, no real knowledge on how to break off from traditional products like rice and corn. They can hardly survive. This is why the Philippine Government is pledged to shape our policies with a view to eradicate poverty by the year 2015.

We need technology in many vital sectors – in food, in medicine, and in education. We aim to modernize agriculture especially because the bulk of our population still relies on rural enterprises. We want to empower our farmers and our fisherfolk. We want to teach them how to raise high value crops such as asparagus, chili, horticulture; teach them how to increase yields through bio-technology.
 

Our village people are ready for development; farmer and fishermen – in their tattered clothes – come eagerly to listen to our agricultural extension workers who explain to them new techniques in improving their crops and production processes. We want to shatter this image and create a new image of progressive farmers and fishermen sitting at computers and dealing with their export partners through the internet and other new forms of electronic communication.

In Monterrey, Mr. Chairman, we proposed that financing for development can take forms other than grants and loans. It can take the form of capital resources, such as software and hardware. Surely, innovative mechanisms can be found to transfer these technologies into the heart of the local communities and into the hands of the peasant. Consequently, we open up his world and establish interconnectivity with the rest of the world. This is what me mean by empowerment.

I would like to explore with you a model for an integrated approach to development. Allow me to preface this conceptual model, Mr. Chairman, by referring to a vision of  development that will underpin the creation of a modern and humane society. First, therefore, we have to build a mature political structure with strong, responsible institutions that foster international cooperation. Second, we should develop a viable economic regime with effective, adequate mechanisms like open markets, that facilitate growth in trade and commerce and are constantly improving the living standards of all peoples. Third, we must have a reliable social foundation in which there are proactive, progressive organizations – governmental and non governmental alike – that care for the disadvantaged and support people’s empowerment.

 Under the GATT-WTO regime, developing countries have had to open up their home markets before home businesses have reached the size and maturity to compete with the larger, well-financed developed countries. Developing countries like the Philippines had to undergo the necessary structural adjustments to meet commitments made under the global rules-based trading system. Fledgling industries, such as our metal and engineering sectors, have suffered and lost valuable trained personnel who have sought employment abroad.

Within the context of UNCTAD, the prevailing mechanism for eradicating poverty is the expansion of international trade. We speak of integrating developing countries into the global economy. However, as we all know, international trade cuts both ways; it can cause a boom or create a bust. It is not sufficiently recognized that integration into the international economic system to be generally beneficial to a people, there has to be a critical measure of integration of local communities and the rural hinterland into the national economy. Variations in development levels is obvious among countries; what is less obvious, and perhaps even invisible, are differences in the levels of development within the national borders of developing countries.

The differences in development levels within national borders and the absence of adequate intermediate support infrastructure have  failed to provide sufficient opportunities for livelihood or employment in many developing countries. Consequently, entire populations move from the villages to the cities, and failing to find opportunities there, seek employment in other countries.   Migration – from countryside to the cities, from developing to developed countries -  has become a common solution in the search for a better life. This, in fact, has been a major trend in my own country’s experience over the last four decades or so. This process has caused a diaspora of some eight million Filipinos to about 180 countries around the globe.
 
 It is very crucial for  developing countries with large less developed hinterlands to have the space and flexibility to adopt the requisite strategies to develop and integrate their local communities into the national economy even as they integrate  into the international economic system. This is where UNCTAD can make a difference.

 UNCTAD can help developing countries understand the issues to be negotiated within the WTO process. But beyond this, it should help developing countries establish the infrastructure that will enable them to truly meet the challenges of globalization. I speak of human resource development, the development of the legal system, and market-support structures within our borders.

It is not enough, Mr. Chairman, to preach the gospel of trade liberalization and globalization to developing countries; rather, it is more critical to help us build the complex of linked and inter-related domestic infrastructures, institutions, systems and enterprises that will form the foundation of effective international competition and industrialization. Global, without local integration results in the de-industrialization of entire sectors and the de-development of entire communities within a country.

 This building process is also important because it considers the varying levels of development with which countries around the world engage trade liberalization and globalization. This building process shall truly operationalize the theory and philosophy behind special and differential treatment, which is that of recognizing the need to nurture enterprises and workforces, and even economies, before they are put out into the sometimes ruthless world of competition and globalization.

 Furthermore, and perhaps more critically, it is imperative that in the development process, efforts to develop our agro-industrial sectors should remain a long-term legitimate concern. The development process, therefore, should provide developing countries the requisite policy space to pursue strategies that would allow them to develop fully their potential in sectors such as agriculture, manufacturing, and technology development.

 To cite a few examples of integration at the local level. In dairy farming, Mr. Chairman, the Philippines has long been an importer of dried milk powder, which has been costly insofar as meeting the dairy requirement of our populace. We feel that a possible policy response to this is dairy farming under a collective system of management that will facilitate integration of the farmer into the broader supply chain. Milk will be collected daily from the farmers and then processed and packaged for distribution by the integrators. In the sector of poultry raising, farm productivity can be enhanced on two levels. Apart from rice, farmers can grow feed grains for day-old chicks that are fanned out to them from the integrators. Once they have reached broiler size, they are re-sold to the source that again will package and again distribute them.

 A third example of the need for economic integration at the local level is even more dramatic as it takes place in the middle of Sulu and Basilan. You may be familiar with these provinces of the Philippines because they rate highly on CNN as problem areas for terrorism related to the Abu Sayyaf. Basilan and Sulu are rich in resources but the people are poor because of the lack of opportunities. In the midst of this problematique, unbelievable as it sounds, we are undertaking mariculture and seaweed farming. Our fisherfolk produce the raw material for carageenan, which is sadly lacking in free market access in some markets of developed countries. We understand it serves as the basis for a myriad of food products profits from which should be channeled back to those who farm it in order that they may be able to increase their productivity and participate more actively in this so-called world economic integration process. Our farmers and fisherfolk need to be empowered to become full partners in the development process.
 
 Consequently, Mr.Chairman, I strongly urge UNCTAD to take our proposed development agenda into consideration, particularly in its analytical and technical assistance activities. We must begin to view  the world from a more holistic and dynamic perspective. And we must view economic development from the prism of our total existence; a prism that goes beyond mere economic indicators and encompasses social, psychological, environmental, cultural and political incidents, if only to understand the challenge of poverty more clearly.

 The development challenges of the day, therefore, demand a basic and policy research agenda that factors into the new analytical framework the issues of practical application that the UNCTAD member countries will face in the fields of trade, investment, and finance.
 
 Mr. Chairman: In order to be responsive to the actual situations of countries over the wide spectrum of development stages, UNCTAD also needs a program of technical assistance to establish and build up local capabilities for development planning of a mode that embodies feasible trade strategies.  This program should provide a basis for negotiating fair treatment in global trading arrangements, as well as create development strategies from the more esoteric theoretical aspects of it to the most practical applications in specific negotiations.

 We need to build this integration process. We need to build to promote trade and employment. We need to build in order to progress.

 Thank you very much.