Yearbook of the United Nations, 2006. Part 3, Economic and social questions. Chapter 4, International trade, finance and transport

Abstract

In 2006, world merchandise trade expanded at a rapid pace, with the volume of world exports growing an estimated 10 per cent, from 7.3 per cent in 2005. The strong growth of world trade, which was bolstered by broad-based import demand across a majority of economies, was, however, expected to moderate to about 7 per cent. The United States remained the major locomotive for world trade, with its demand accounting for some 13 per cent of the world total. Import demand in the European Union (EU) accelerated, reflecting a better-than-expected growth recovery in Western Europe, as well as in most developing countries and the economies in transition. Demand in the oil-exporting and mineral and metal-exporting economies in Africa, Latin America and Western Asia grew at double digits, driven by strong consumption demand and demand for new production capacity and infrastructure. Demand for primary commodities also remained strong, owing in particular to the continued rapid pace of industrialization of China and India and other emerging developing countries. The net transfers of financial resources from developing to developed countries increased from $533 billion in 2005 to $662 billion in 2006. The net transfers of financial resources from transition economies also increased in 2006, from $112 billion to $133 billion. The level of net private capital flows to developing countries and transition economies in 2006 were high in historical terms, although lower than that recorded during the previous year, with the financial-market turbulence in the second quarter of the year contributing to the moderation. Recognizing the urgent need to enhance the coherence, governance and consistency of the international monetary, financial and trading systems, the General Assembly noted that developing countries as a whole continued to experience a net outflow of financial resources and, in that regard, requested the Secretary-General to analyse the reasons and consequences and to report thereon. The Assembly underlined the importance of promoting international financial stability and sustainable growth, as well as national efforts to increase resilience to financial risk and measures to mitigate the impact of excessive volatility of short-term capital flows. In April, the ninth high-level meeting between the Economic and Social Council and the Bretton Woods institutions (the World Bank Group and the International Monetary Fund), the World Trade Organization (WTO) and the United Nations Conference on Trade and Development (UNCTAD) discussed coherence, coordination and cooperation in the context of the implementation of the Monterrey Consensus, adopted at the 2002 International Conference on financing for Development, and of the 2005 World Summit Outcome. The Assembly decided to hold the Follow-up International Conference on Financing for Development to Review the Implementation of the Monterrey Consensus in the second half of 2008, and intergovernmental consultations in 2007. In July, the multilateral trading system suffered a serious setback when a meeting of trade ministers from the G-6 countries (Australia, Brazil, India, Japan, the United States and the EU) failed to break the impasse in the five-year long Doha Round of international trade negotiations. The indefinite suspension of the Doha Round cast serious uncertainty on the status of the negotiations, which were expected to conclude in December, with a single undertaking among the 149 WTO members that would build on and deepen liberalization in WTO agreements and usher in a stronger focus on the development dimension. Expressing serious concern at the suspension of the negotiations and calling for their early resumption, the Assembly appealed to developed countries to demonstrate the flexibility and political will necessary to break the impasse and stressed that in order for the Doha Round to be concluded satisfactorily, the negotiations should result in the establishment of rules and disciplines in the area of agriculture. At its twenty-third special session, the Trade and Development Board (TDB), the governing body of UNCTAD, conducted a mid-term review of the implementation of the São Paulo Consensus, adopted in 2004 by the eleventh session of the Conference (UNCTAD xi). TDB adopted an agreed outcome on the mid-term review, which, among other things, reaffirmed the work of UNCTAD three pillars of research and analysis, consensus building and technical cooperation. It also adopted agreed conclusions on the review of progress in the implementation of the Programme of Action for the Least Developed Countries 2001-2010; economic development in Africa: doubling aid—making the “big push” work; and decisions on the review of UNCTAD technical cooperation activities and the timing of its 2007 session. The International Trade Centre, operated jointly by UNCTAD and WTO, increased its delivery of technical assistance by 15 per cent to $25.3 million.