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Rich countries must take pain to help poor: UN

REUTERS, Geneva
Rich countries will have to make painful structural changes if they are to carry out pledges to help poorer states move into the global economic mainstream, a United Nations report said Monday.
Such changes should include faster phasing-out of labourintensive industries and opening up markets to vital Third World exports like clothing, footwear and farm produce, according to the UN's trade and development agency UNCTAD.
In its annual report on developing countries and world trade, the Geneva-based body said that even the more advanced of the world's poorer states would need better access to finance and technology to move up the production scale.
But it implicitly warned the richer powers in the currently 144-member World Trade Organisation (WTO) against trying to force faster liberalisation on developing coun-
tries by making it a condition for opening up their own markets.
Following the WTO's ministerial conference last November in Doha which launched a new round of fee trade negotiations, UNCTAD Secretary-General Rubens Ricupero said, global trade had to be made more development friendly.
It would be wrong, declared Ricupero, to suggest that easing trade barriers to goods from the South "carries no, or only small, adjustment costs in industrial countries" -- where low-skilled workers already fear for their remaining jobs.
"But renewed protectionism is not the way forward," the UNCTAD chief said in a clear reference to calls from Western-based labour bodies for trade with poorer states to be tied to rules making them improve treatment of their workers.
The report said the apparent sharp increase in developing country exports of manufactured goods
over the past two decades was a mirage and had brought scant increase in living standards for the Third World's low-paid workers.
Much of the growth had been in manufactured goods, now 70 per cent of developing country exports, and statistics seemed to show that many poorer states had managed to move into trade in high-technology sectors like electronics and electrical goods.
But exports from these states -apart from a few in East Asia -- were still largely the product of unskilled labour or were semi-finished products moved by big global firms from one poor country to another for assembly operations, UNCTAD said.
All developing countries needed help to move in to high-skill product lines where markets were currently dominated "by oligopolistic northern producers" who competed on the basis of quality, marketing and brand rather than price, UNCTAD said.