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Controversy over the "Agenda for Development"
New York - The preliminary draft of an "Agenda for Development" by UN Secretary General Butros Butros Ghali met fierce criticism at the 49th General Assembly in New York. The paper, dated 1st September 1994, contains too few concrete proposals, the critics argued.
The agenda has two parts. The first part defines development as the main task of the United Nations. Development is based on five pillars: peace, economy, environment, justice and democracy. In the second part, Butros-Ghali attempts to explain why the UN in particular could coordinate cooperation between development organisations - but without a concrete discription of this process.
Critics complain about the lack of a clear statement on the future relationship between the UN on the one hand and World Bank and IMF on the other. According to the Secretary General a 'world security council'- in other words a reformed economic and social council (ECOSOC) - should have a stronger influence on the two financial institutions. The non-aligned and other countries of the South such as India and Indonesia have argued against such a body since it would only create new privileges for a small number of countries.
Butros-Ghali has been working on the 'Agenda for Development' since 1992. At the time, the non-aligned movement had insisted at the 47th General Assembly on the draft of such a paper as the continuation of the 'Agenda for Peace'. The agenda for peace had raised worries among many poorer countries that the United Nations might reduce its long term economic aid in favour of peace keeping missions and emergency aid.
Germany as a Member of the UN Security Council
New York - The General Assembly of the United Nations (UN) in New York voted on 21 October in favour of Germany's membership of the Security Council. According to Foreign Minister Klaus Kinkel, Germany aims to strengthen its involvement in "Blue Helmet Missions" of the UN.
The budget of the Federal Republic of Germany for 1995 allocates 90 million DM to support peace keeping missions. A mobile medical unit is currently being set up. A transport vehicle for troupe is also planned. Germany's membership of the Security Council lasts for three years.
BMZ: Development through Saving and Loans
Bonn - The reform of financial institutions in Southern countries is an essential pre-condition for the success of development programmes, according to the Federal Ministry for Economic Cooperation (BMZ). This new development strategy is explained in the sector paper. "Development of Financial Systems - Promotion of Saving and Loans" which was published in September.
The market economy, competition and overall economic stability have been proven to be the best pillars for the development of a financial system, the paper argues. A financial system which is oriented towards the market economy is again the most important condition for the success of economic reform and restructuring in many Southern countries. However, the task is not only to support «entrepreneurial initiatives of the people" but also to fight poverty and to strengthen the position of women.
Two approaches for reforming financial systems can be identified: the "bottom up" and the " top down " approach. The "bottom up approach" is based on the assumption that "the willingness to save and to spend resources on investment reflects in a very basic way a commitment to self-help". Therefore, new financial institutions must be strengthened from below. These include, among others, local saving banks, loan cooperatives and self-help banks of poor people.
The second approach is a reform strategy from the top ("top down"). It entails the support of public policy such as the liberalisation of interest rates, the design of new banking legislation or of directives for accounting. Also, it aims to establish an central bank which is as independent as possible and a supervisory structure for the financial sector, as well as the restructuring of existing banks, specifically development banks.
All bilateral and multilateral development instruments are in principle appropriate for reforming financial institutions. In Germany, all institutions concerned, in particular the GTZ and the Kreditanstalt fÃ¼r Wiederaufbau (KfW) should cooperate in a close working relationship.
According to the BMZ, the new sectoral programme is a decision-making aid for deciding on the selection, approval, planning and implementation of programmes for public development cooperation. For NGOs it is meant to be an orientation guide.