Flexible commodities strategy needed to sustain growth in producing countrie
NEW YORK--The reform process being undertaken by the Common Fund to consolidate a more focussed mandate, greater efficiency in its operations and governance, should be a lightning-rod opportunity for the institution to continue helping commodity-dependent countries take advantage of the economic growth availed by the rapidly expanding global commodity markets.
The Managing Director, Amb. Mchumo offered this view in his address in New York, during the 66th Meeting of the United Nations General Assembly's Second Committee, which deliberates on macroeconomic policy issues related to commodities and development.
In his statement, Amb. Mchumo called on the Second Committee, "to articulate the need for an open and flexible strategy for the new role of commodities, which could guide the development community to be wise about commodities, as a pillar of sustainable global growth and development."
Amb. Mchumo recalled that the international consensus required for global commodities supply management had not fully materialized in over 20 years of CFC operations, and that it was a clear indication that theoretical and political underpinnings for collective action in this respect, still fell short of Member Countries' expectations.
Amb. Mchumo in a broad overview during his remarks noted that commodity-dependent countries need not wait to take advantage of the lucrative opportunities that are emerging in commodity markets.
He said, "The opportunities are there and should be developed further by taking the sector's activities and operations, as close as possible to primary producers, while keeping the door open for the private sector and financial investors to come in at the earliest stage."
"Finding new ways to take Member Countries out of the cycle of commodity dependency will require practical innovation and replication much like the successes, which have been documented and disseminated by the Common Fund across many commodity sectors," said Amb. Mchumo.
"Some areas still require urgent attention--raising agricultural productivity through technology and applied R&D knowledge; effective use of productive resources and water; improved market linkages; and direct measures to transfer and mitigate risk to reduce vulnerability of producers," he said.
He reassured the Committee that: "In the run-up to UNCTAD XIII in Doha, the Common Fund will do its part in attending to these issues. We therefore welcome the renewed attention by the G20 concerning greater market transparency for the benefit of food market and price stability, but much intensified action is called for in the light of the rapidly expanding knowledge of commodity market, as mirror of global capital movements." [END/2011]