Report of ECO Secretary General to the meeting

 

The 9th Consultative Meeting of Executive Heads of Sub-Regional Organization with UNESCAP took place on 24 April, 2004 in Shanghai, China. This is a regular consultative mechanism of discussions with UNESCAP; as it is the coordinating UN Agency for Development for Asia and Pacific. The 8th Meeting was hosted by ECO in July 2003. The 10th Meeting would be hosted by SAARC next year.

 

2.         The Meeting was attended by ECO Secretary General H.E. Askhat Orazbay, UNESCAP Executive Secretary H. E. Mr. Kim Hak Su, ASEAN Secretary General H. E. Mr. Ong Ken Yong, SAARC Secretary General H. E. Mr. Q.A.M.A. Rahim and Pacific Island Deputy Secretary General Mr. Josefa Maiava (Annex I. List of Participants).

 

3.         The meeting took place on the sidelines of the 60th Session of UNESCAP at the seat of its birth-Shanghai, China. Secretary General of ECO also participated briefly in 60th Session proceedings of the meeting as well as associated Business Forum Meeting. He also held bilateral meetings with the participants of Heads of Sub-Regional Organizations.

 

4.         There were two sessions of the 9th Consultative Meeting (Annex II - Program of the Meeting):

 

A.        Opening Session

B.         Detailed Discussion Session

 

A. Opening Session

 

5.         In the opening session, the UNESCAP Executive Secretary Mr. Kim Hak Su throwing light on the history of the Consultative Mechanism stated that the consultative process between the sub regional organizations and UNESCAP was initiated in February 1994. As the consultative process entered its second decade, he said, it was timely to consider operationalizing such cooperation through the development of a “Cooperative Framework.” He explained the difference between this year’s Consultative Meeting and previous year’s. He stated that this year they had put forward a complete Framework for cooperation between sub regional organizations and UNESCAP.

 

6.         He explained that the broad contours of such a framework could encompass Trade, Transport, Energy, Poverty Alleviation and Human Trafficking with the option to include other issues of contemporary interest.

 

7.         Further elaborating on the Cooperative Framework he said that it would incorporate two important principles: i) cooperation would be on a voluntary basis and there would not be binding commitment on any  organization ; and ii) as a corollary of the first, involvement of all organizations in every cooperation initiative would not be necessary. A three-dimensional approach to cooperation was envisaged:

1.         Cooperation between UNESCAP and a sub regional organization

2.         Cooperation between UNESCAP and more than one sub regional organization

3.         Cooperation between and among sub regional organizations.

 

He invited all the participating organization to respond to his proposal.

 

8.         The ECO Secretary General in his opening statement thanked UNESCAP for their elaborate arrangements. He also thanked the Government of China for their support to the holding of under reference meeting, especially their support for the International Road Federation project of Development of Silk Route.

 

9.         On the topic of the meeting he started by saying that ECO provided UNESCAP another angle to look at the region. At the same time ECO strived to get more for its member countries in terms of technical support from UNESCAP. Appreciating the UNESCAP’s new approach he stated that the meeting of today provided an opportunity to exchange views and experiences for the benefit of each organization; but more importantly, this meeting would go further to explore framework of cooperation between sub-regional organizations and UNESCAP. He said that this was a good approach and also practical one as this would add a lot of value to this meeting.

 

10.       He informed the meeting that For ECO, the priority areas were trade, transport and energy and therefore we might cooperate in these areas along with cooperation in poverty reduction and food security which was most important human issue and could not be separated from international trade and transport or availability of cheep and clean energy issues. As regard to ‘Human Trafficking’ he said that ECO as a sub-regional organization had not been involved but it was an important issue for all ECO countries and any proposal for cooperation would be forwarded to Member States. He informed the meeting that he would be talking in greater detail on each specific agenda item.

 

B.  Detailed Discussion Session

 

i)  Trade and Investment

 

11.       Under this agenda item the Executive Secretary of UNESCAP said that virtually all countries professed their commitment to the “multilateral trading system” and to continued negotiations under Doha Development Agenda. Giving his opinion he said that while Bilateral Trade Agreements (BTAs) and Regional Trade Agreements (RTAs) derogate from the principles of the multilateral trading system, the collapse of the Fifth WTO Ministerial Conference in Cancun had added increased impetus towards BTAs and RTAs trend. He said that apart from this disadvantage there were some advantages to BTAs and RTAs, as these tend to include other areas of economic cooperation, such as investment, intellectual property rights (IPRs), Science and Technology, Standards, Trade Facilitation, etc., thus containing deeper commitments than those made within the context of the WTO or other multilateral frameworks.  However, there was a clear risk that countries, in particular the poorer ones, would have significant difficulties in effectively managing many different and overlapping commitments within the framework of their membership in a host of BTAs and RTAs.

 

12.       He said that with the promotion of a multilateral trading system as a long-term objective and in view of the short-term and intermediate trend to the proliferation of BTAs and RTAs, UNESCAP had developed “the Comprehensive Trade and Investment Cooperation Framework (CTICF) for Asia and the Pacific”, with the aim to: (i) enhance national capacities to accede, negotiate, conclude and implement multilateral and regional trade and investment agreements; and (ii) forge coalescing, among emerging BTAs and RTAs and other forms of economic partnerships in the region within a common WTO-consistent framework, towards a free and fair multilateral trading and investment regime.

 

13.       He said that UNESCAP intended to organize with the respective sub regional organizations dialogues and training workshops, conferences and seminars; as well as, would like to conduct joint studies at sub regional level on WTO issues to create and increase awareness and knowledge of WTO agreements and current negotiations under the Doha Development Agenda (DDA) and their implications. He said that this would allow countries to share experiences in implementing WTO agreements and to identify and promote commonalities at WTO negotiation forums.

 

14.       He said that under the regional and bilateral trade and investment cooperation tracks, UNESCAP intended to organize activities with its sub regional partners aimed at forging regional cooperation in achieving WTO-consistent regional and bilateral integration initiatives with trade, and to a lesser extent, investment, at their core (i.e. in the form of free trade areas) along a common format. In addition, in collaboration with its sub regional partners, UNESCAP would want to develop a database of existing and emerging BTAs and bilateral investment treaties (BITs) with a brief description of each agreement. The goal was to develop common frameworks for BTAs and BITs as building blocs of RTAs and the Multilateral Trading System and to consolidate these agreements within such frameworks so as to ensure effective links between sub regional, regional and multilateral cooperation initiatives.

 

15.       ECO Secretary General in his response stated that ECO believed in consensus Multilateral Trading System under one international body like WTO. It understood that in the absence of such arrangements Regional Trade Agreements were a way forward. Therefore in the regional perspective the main objective of ECO in the trade sector was to take measures towards progressive removal of trade barriers within the ECO region and expand intra regional trade and consequently global trade.

 

16.       He added that ECO, therefore, endorsed the building up of databank of RTAs or BTAs and understood that this would be particularly useful approach. If need be, ECO Secretariat would forward ECO Trading Agreements to UNESCAP to be incorporated into that databank.

 

17.       He said that ECO would also support where ever it could to participate in workshops or seminars or studies in this regard.

 

18.       He suggested that UNESCAP and ECO might wish to cooperate on the implementation of ECOTA and in preparation of ECO Rules of Origin and finalization of revised draft text of the Agreement on Promotion and Protection of Investment among ECO Member States. He said that ECO and ESCAP could organize training courses on the accession process of the non-WTO ECO Member States to Multilateral Trading System.

 

19.       Furthermore he suggested that creating a joint working group to review available information infrastructure and to decide measures for capacity building, human resource development, universal access with ICT and its use for trade and investment liberalization and e-commerce promotion. He said that a country level study might be considered to be prepared reviewing available architecture for e-commerce systems to enhance interconnectivity of design and standards with the regional information infrastructure. He proposed organizing a seminar to share best practices and learn from the experiences of the more developed countries especially in ASEAN region (Malaysia, Singapore, and Thailand). He also suggested establishing a Forum on the model of ASEAN Public Key Infrastructure (PKI) in order to ensure broader harmonization of e-transactions and e-signatures legal frameworks.

 

20.       He said that ECO-UNESCAP could also jointly organize the seminar on trade and investment. The seminar would bring together trade and investment officials of the two groupings as well as business leaders from the two regions to exchange views on ways and means of promoting trade and investment for their mutual benefits.

 

21.       Before speaking in trade specificities he gave a brief resume on ECO activities on Trade and investment. He also informed about recent Investment related meeting in Afghanistan from which he had just returned.

 

            ii)  Transport

 

22.       On this agenda item the Executive Secretary of UNESCAP stated that with rapid globalization in the ESCAP region there is an increasing demand for international transport linkages and networks.  Until recently this demand had focused more on international movement of goods through ports and maritime shipping to reach markets in other regions.  There, however, always existed a great potential for the development of land transport services to help promote intra-regional trading opportunities.

 

23.       He stated that all regional organizations were invariably taking initiatives to improve the capacity and efficiency of the land transport sector with respect to both infrastructure and facilitation.  The speed of progress in each of the sub regions, however, had varied widely; and, important lessons were being learned that could be usefully exchanged.  In addition, there would appear substantial benefits in seeking approaches that would encourage greater harmonization across the sub regions particularly with respect to trade and transport facilitation, at border crossings.

 

24.       He informed the meeting that UNESCAP had been guided by the New Delhi Action Plan on Infrastructure Development which also provided an outline framework for the cooperation with sub-regional organizations and groupings. Over many years the UNESCAP secretariat had been working closely with the sub regional organizations, in this regard. He informed the meeting that extent of such cooperation had been greater compared with ECO region.

 

25.       Referring to implementation of the New Delhi Action Plan he informed that a Ministerial Conference on Transport was being planned to be convened in November 2006 which could provide an excellent opportunity to substantially speed up development in the transport sector and promote intra-regional trade. He suggested a special one day meeting of Sub regional organizations when Ministers of Transport from each of the sub-regional organizations and groupings would be meeting to provide the ministers with the opportunity to consider specific issues and concerns at the sub-regional level to consider the cross-cutting or inter-sub regional issues that needed to be addressed at the regional level (continent level). He said that such an approach could lead to a greater coherence between programmes of the sub-regions.  In particular, he said that such coordination in the Conference could lead to a more harmonized approach to the issues of trade and transport facilitation and the application of information and communication technology within the transport and logistics sectors of the region.

 

26.       ECO Secretary General in his comments stated that Transport was equally important area of cooperation between ECO countries or world as a whole, especially for transportation of goods. Without a satisfactory transportations system, he said that the trade would not be feasible economically. Transportation was a key to trade, he said.

 

27.       He said, as it had been mentioned in New Delhi Action Plan, that transportation and communication played an essential role in trade between the countries of the region. In particular, for the landlocked countries, it was very important to use transit facilities of their neighboring countries and more than that it was very crucial for the countries of every region to initiate integrated transportation systems for carrying goods and passengers and use multimodal transportation systems, using and applying transit and border crossing facilities.

 

28.       He requested technical as well as organizational support of UNESCAP to sub-regional organizations such as ECO which might contribute to a large extent to achieve above goals.

 

29.       He said that there had been good cooperation between ECO and UNESCAP as far as consultation in transportation and communication is concerned in the past and at the moment there was a multimodal transport project going on between the two organizations with financial contribution from IDB and technical support from UNCTAD.

 

30.       He endorsed the proposal of the meeting of the Ministers of Transportation with sub-regional organizations on the side line of Ministerial Conference in November 2006 as it was likely to create a more coordinated and integrated cooperation.

 

iii)  Energy

 

31.       Broaching the issue the Executive Secretary of UNESCAP said that energy security was one of the major concern of Governments in ensuring sustainable economic growth.  While the efforts to increase the share of renewable energy would continue and enhanced, fossil fuel would remain the major energy resource in the region in the foreseeable future. At the same time, the pressure to reduce the burden on the environment from the energy sector would continue to increase, which created the quest for cleaner sources of energy at a competitive price on a long-term basis.

 

32.       He pointed out the fact that though Asia was rich in energy resources but this resource was not evenly distributed across countries or sub regions which opened up the potential for energy development and trade. He said that countries that had already developed cooperation agreements either bi-or-multi-laterally or through their sub regional organizations were reaping the benefits of such cooperation.

 

33.       He said that while any sub-sectors of energy could be chosen for cooperation, recent trend seemed to be in two major sub-sectors, i.e. natural gas and electricity grids.

 

34.       He said that there was a great potential for trade in natural gas in the ECO region. Elaborating further, he said that the globalization process offered a good opportunity for enhancing cross-border energy trade which was mutually beneficial for all stakeholders. The benefit of having natural gas pipelines that cross several borders would contribute to enhance energy security through sharing of risks and responsibilities in the development and operation of the pipelines.

 

35.       In this regard he suggested to develop a complete and compelling strategic plan with appropriate analysis of the market dynamics and energy trade flows. He asked whether the Heads of the Sub-regional Organizations would facilitate the process, to secure political and financial commitment, followed by extensive multi- and bi-lateral negotiations to clearly identify and share the responsibilities among stakeholders?. In this regard he said that UNESCAP had a unique position as an independent and neutral body to play a catalytic role in facilitating the process including facilitating policy dialogues as well as negotiations.

 

36.       He informed that UNESCAP had agreed to support the proposed APEC-PEG initiative on the Asian Gas Grid (the Partnership for Equitable Growth (PEG)-a non profit organization which is acting as a catalyst for private sector involvement within the framework of APEC) with a view to develop a linkage and synergies with other initiatives, in particular the North-East Asian energy initiative. He suggested creating similar initiatives for other regions also.

 

37.       He informed the meeting that UNESCAP had been involved in facilitating the development of some action programmes or plans. He said that the level of involvement had been largely catalytic or supportive to other efforts, in partnerships with lead government agencies or research institutions. In this regard he gave the example of published study on Trans-country Power Exchange and Development in South and South-East Asia by UNESCAP. This study served as an important input to the subsequent work of the ASEAN and the Greater Mekong Sub-regional initiatives in this area. He said that UNESCAP was currently involved in facilitating energy cooperation in North-East Asia towards the formation of an intergovernmental mechanism.

 

38.       ECO Secretary General in his response said that generally speaking, in the field of energy, in ECO region, there was a need for cooperation to facilitate energy infrastructure development and energy exchange/trade. He said the ECO understood the need of a complete Strategic Plan for the whole of Asia, however, to deal with the inter-regional energy infrastructure development and energy exchange/trade isues, the ECO Secretariat would need endorsement of all ECO member-states. Subject to such an endorsement,  a complete and compelling strategic plan, as proposed by the ESCAP, might be developed along with carrying out appropriate analysis  of the market dynamics and energy trade flows. He promised to consider any proposal sent to ECO and hoped to get political support as well if ECO member countries found the plan useful.

 

39.       Adding a caveat, he said that the development of such wide ranging plan would only be possible with financial and expert assistance of international donors.

 

40.       He suggested that the following actions as a first step in the development of such cooperation could be taken:

 

 

41.       He said that as the materialization of the proposed cooperation in the field of energy might take several years, it would be useful, alongwith dealing with it, to have cooperation on some other broader energy issues of interest to all countries covered by ESCAP. For example:

 

 

Cooperation in poverty reduction and food security

 

42.       UNESCAP Executive Secretary broaching the issue said that UNESCAP had substantive experience in the identification and replication of appropriate practices in poverty reduction across the region.  Cooperation with one or more sub regional organizations could be beneficial, both with regard to sharing good practices in poverty reduction from individual sub regions as well as replicating successful initiatives in a collaborative manner.

 

43.       He said there was also a scope for collaboration in promoting R&D for poverty alleviation and food security, through the Centre for Research and Development of Coarse Grains, Pulses, Roots and Tuber Crops in the Humid Tropics of Asia and the Pacific, which operates within the framework of UNESCAP.

 

44.       Explaining the poverty situation in ECO region the ECO Secretary General in his response stated that ESCAP region had largest group of poor people with 800 million still living on less than one dollar a day. With regard to ECO, in 2000, around 60 million people were undernourished, corresponding to 15.6% of the total population. He said although the situation had improved since then in some parts of the region there still existed serious problems to be addressed including production, food safety, animal health and agro-trade related issues. He informed that fortunately, the ECO region had also some of the most successful experiences in poverty alleviation and a record number of best practices. He said that ECO appreciated the efforts of ESCAP Secretariat for successfully compiling and trying to replicate and adapt some of these practices in other parts of the region.

 

45.       He said that supporting rural development programmes through providing micro credits, new technologies, establishing small scale enterprises leading to income and employment generation were other areas of common interest for ECO member countries.

 

46.       He added that along with the activities to be undertaken for the rural poor, ECO believed that support to as the region had a high rate of urbanization - urban based small scale farming such as poultry, mushroom production etc. would also contribute to  alleviation of some symptoms of  poverty and therefore should be considered in food security programmes and projects.

 

47.       Promotion of trade and capacity building in trade related matters were also vital for region, he said; and, within that context, ECO would try to integrate issues of WTO Agreement in Agriculture to its food security projects. 

 

48.       Fighting livestock diseases including establishment of buffer zones, integrated pest management, provisioning of suitable financing and encouraging agro-investments and facilitating insurance of agricultural activities and rural based business (livestock, crop, handcraft, etc.) for reduction of the risks of investment are other points of consideration for ECO, he said. In this regard, he added that after the formulation of food security projects, ECO would like to request assistance of ESCAP and all possible relevant international organizations.

 

49.       As regard to Poverty Alleviation he emphasized that the preparation/updating of Human Development Reports seemed quite relevant. The reports might also, along with standard indicators, try to measure the strengths and needs in respect to human resources particular to that region. With this objective, ECO had already approached UNDP for initiating such a project. He invited ESCAP’s contribution to the process.

 

50.       He suggested that inviting more international organizations like FAO, UNDP for contributing to discussions under relevant agenda items, in future, would also be a good idea.

 

51.       The meeting ended with a vote of thanks for UNESCAP for excellent arrangements as well for all the participating organizations for very useful inputs. ECO’s proactive approach of providing its inputs in advance was especially appreciated by the chair.

 

BILATERAL MEETINGS

 

Meeting with Executive Secretary of UNESCAP

 

52.       Secretary General in his bilateral meeting with the Executive Secretary of UNESCAP congratulated them for making excellent arrangement for the 9th Consultative meeting.

 

53.       He told the Executive Secretary that his organization (UNESCAP) was doing important work in ECO region, In this regard he cited the collaboration in the preparation of ‘Electric Power in Asian and Pacific 1999-2000’ and said the both organizations needed to develop new areas of cooperation.

 

54.       He said that Mineral Atlases received from UNESCAP were greatly appreciated in ECO and requested more detailed maps.

 

55.       He informed that ECO recently launched ECO-Trade-Net Web Portal and requested ESCAP technical support to make it a success.

 

56.       He said the ECO was interested in the work of SPECA. Similarly Asian Highway Development Project was also important for ECO, he added.

 

57.       Referring to consultative mechanism meeting of that day, he said, that it was very useful. He expressed his appreciation of innovative approach by UNESCAP for this year’s meeting by putting forward substantive proposals.

 

58.       He said that generally all the proposals put forwarded by ESCAP were very interesting and ECO Secretariat would forward detailed proposals once received from it (UNESCAP) to its constituting states for consideration for approval.

 

59.       He also suggested that ECO-UNESCAP could also jointly organize seminar on trade and investment. The seminar would bring together trade and investment officials of the two groupings as well as business leaders from the two regions to exchange views on ways and means of promoting trade and investment for their mutual benefits.

 

60.       He said that he would instruct ECO Trade & Transport Directorates to formulate proposals in a letter addressed to him (H.E. Mr. Kim Hak Su) for substantive cooperation.

 

61.       The Executive Secretary of UNESCAP in his reply appreciated the participation of ECO Secretary General in the 9th Consultative Meeting. He particularly mentioned the receipt of advance inputs for the meeting from ECO Secretariat as very useful. He said that he has noted ECO’s proposal and would await detail letters on the suggestions.

 

62.       He said that the cooperation of ECO in the work of SPECA would be very important and he highly welcomed it.

 

Meeting with Secretary General of ASEAN

 

63.       Secretary General later called on the Secretary General of the Association of South East Asian Nations (ASEAN). After exchange of pleasantries he said that ECO wished to learn about ASEAN’s implementation of AFTA: whether it had helped and to what extent. He said that ECO would also supply information on its experience of ECOTA.

 

64.       Second, he said that ECO wished to learn about: (a) roles of free zones in attracting FDI, b) experience of ASEAN Secretariat on e-commerce and secure infrastructure for Banking and Finance; and c) about investment projects in Customs reforms in ASEAN.

 

65.       He also stated that ECO had several proposals to develop its relations with ASEAN.

 

66.       He said that ASEAN could also help enhance the capacity of Trade Promotion Bodies in ECO. In this regard he told him that he had instructed Director Trade to formulate queries or proposals in a letter, which Secretariat would hope to send shortly.

 

67.       He also suggested considering a country level study to be prepared reviewing available architecture for e-commerce systems to enhance interconnectivity of design and standards with the regional information infrastructure.

 

68.       He also suggested holding a seminar to share best practices and learn from the experiences of the more developed countries especially in region (Malaysia, Singapore, Thailand). He also suggested establishing a Forum on the model of ASEAN Public Key Infrastructure (PKI) in order to ensure border harmonization of e-transactions and e-signatures legal frameworks.

 

69.       He also wished to explore possibility of learning in Transport sector particularly about multi-model transport experience in ASEAN region.

 

70.       He said the Agriculture and Industrial Areas are also relevant fields to exchange information.

 

71.       Referring to 9th Ministerial Meeting in September this year in New York he hoped that before the meeting, officials of both organizations would have come up with substantive proposals and progress on existing proposals for cooperation that both organizations would be able to put before their ministers, for approval.

 

72.       He also suggested senior officials from both sides could visit each other Headquarters to carry out the study on developing cooperative relations between the two organizations which had long been approved by joint ministerial meeting of ECO and ASEAN.

 

73.       The Secretary General of ASEAN thanked the ECO Secretary General for useful input during the meeting and agreed to help ECO in the implementation of ECOTA on the model of their trade agreement called ASEAN Free Trade Agreement (AFTA). ECO Secretary General invited him or his representative to ECO Secretariat in this regard. Both sides agreed that in future ECO event ASEAN would be invited and on that occasion someone savvy on trade matters would be sent by ASEAN to exchange information on both ECO and ASEAN Regional Trade Agreements.

 

Meeting with Secretary General of SAARC

 

74.       Secretary General of SAARC called on the Secretary General and informed him that soon he would be relinquishing charge and a new Secretary General would be joining from Bhutan. He requested a continued level of support to the new SAARC Secretary General from Bhutan.

 

Meeting with Secretary General of Shanghai Cooperation Organization

 

75.       Secretary General also had the opportunity to speak with the Shanghai Cooperation Organization Secretary General H. E. Mr. Zhang Deguang. Both the organizations have Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan as their common members.

 

 

76.       The 9th Consultative Meeting ended on April 25 and the Secretary General of ECO took a return flight on April 26, 2004.

 

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