29 October 2010: The UN Conference on Trade and Development (UNCTAD) held an event, from 27-29 October 2010, on building productive capacities in Least Developed Countries (LDCs). The event aimed to produce substantive inputs to the preparatory and negotiating process for the Fourth UN Conference on LDCs (LDC IV) in 2011, and in particular, a successor Programme of Action for the LDCs.

The event featured high-level panels from government and international organization representatives. At the wrap-up session, Charles Gore, Special Coordinator for Research and Policy Analysis, Division for Africa, Least Developed Countries and Special Programmes at UNCTAD, concluded that the event had raised a number of important issues that would provide substantive inputs into preparation for LDC-IV. Major areas of debate were the national level (including the relationship between the State and the market), the international aspect (international support mechanisms, aid, and investment), and the opportunity for South-South cooperation. The meeting stressed the “obvious but often ignored importance” of LDC-to-LDC cooperation.

During the meeting, delegates discussed the contributions of science, technology and innovation and trade logistics to building productive capacities. Ahmed Abdel Latif, Programme Manager for Intellectual Property and Technology at the International Centre for Trade and Sustainable Development, called for putting innovation and the policies it requires onto the global agenda. He expressed his hope that measures adopted at LDC-IV would be more oriented towards spurring innovation and technology development than was the case with previous LDC conferences.

Noting an increase in recent foreign direct investment (FDI) into LDCs, James Zhan, Director of the Division on Investment and Enterprise at UNCTAD, underlined the need for such investment to be both “in the poor” (viable and sustainable investment in poverty alleviation), for the poor (accessible and affordable products and services) and with the poor (fostering business linkages with domestic small- and medium-sized enterprises).

Carlos Nuno Castel-Branco, Director of the Institute of Economic and Social Studies in Mozambique, called attention to the need for targeted productive capacities development in LDCs. He gave an example from his home country, where per capita GDP had grown over the last seven years by 45%, mainly due to mineral resource extraction, while per capita food production had declined by nine percent over the same period. The result was that two million more people in Mozambique lived below the poverty line than seven years ago, even though statistically they were “richer.” Castel-Branco remarked “the aim should not merely be to build productive capacities, but also to build them in appropriate areas.”

In a press conference related to the event, Supachai Panitchpakdi, UNCTAD’s Secretary-General, identified building productive capacities, the topic of the event, as a key challenge for individual LDCs and international organizations working with them. He said, “it is only through removing the structural deficiencies that these countries can truly integrate into the international system, open up for beneficial trade, and escape the poverty trap.” [More information]