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Commonwealth Ministerial Group on Small States - Chairperson's Report to CHOGM

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Commonwealth Ministerial Group on Small States
Fifth Meeting
Coolum, Australia, 1 March 2002

Chairperson's Report to CHOGM

Introduction

1. The Commonwealth Ministerial Group on Small States (MGSS) held its fifth meeting on 1 March 2002, in Coolum, Australia, on the eve of the Commonwealth Heads of Government Meeting (CHOGM). The meeting was chaired by the Hon. Alexander Downer, Minister of Foreign Affairs, Australia. Representatives from 38 member governments and observers from the World Bank, International Monetary Fund (IMF), the European Commission (EC), the Caribbean Community (CARICOM) and the Pacific Forum Secretariat attended the meeting.

2. The meeting was opened by the Commonwealth Secretary-General, Rt Hon Don McKinnon. He welcomed the publication of the Commonwealth Secretariat/World Bank Joint Task Force Report on Small States as a landmark step by the international community in addressing the special needs of small states. He noted that the Commonwealth had played a crucial role in promoting the interests of small states and contributed to greater international awareness of the particular vulnerabilities of these countries. He emphasized the need to obtain broad support for further work in implementing the recommendations of the Task Force and urged MGSS to clarify the most productive areas in which further work could be undertaken by the Commonwealth and other agencies. The Secretary-General affirmed that small states were an integral part of the Commonwealth's diverse identity.

3. Following his election, the Chairperson said Australia had an enduring interest in and concern for small states. This had been influenced in part by Australia's proximity to a number of small states. He pointed out that more than 30 per cent of Australia's aid programme was dedicated to working with the Pacific's small states. This was in addition to the support Australia had given to a number of Commonwealth activities which addressed small states concerns. This included the proposing and continued support for the Commonwealth Small States office at the UN in New York. He urged the meeting to provide feedback on the progress of the recommendations of the Joint Task Force report and to advise the Secretariat on the priorities to be pursued under the New Agenda for Commonwealth Work on Small States.

Implementation of the recommendations of the Joint Task Force Report

4. In reviewing the implementation of the Recommendations of the Joint Task Force Report, Ministers welcomed the presentations made by the partner organisations (the Commonwealth Secretariat, World Bank, IMF, the EC Pacific Forum Secretariat and Indian Ocean Commission) on the work that was being undertaken in their respective organisations, in implementing its recommendations.

5. Ministers expressed broad support for the programme of work that had been undertaken on behalf of small states. They called on the international community to provide comprehensive support to assist small states integrate into the global economy. They emphasised the need for follow-up work to pay particular attention to the special needs of small states in meeting the challenges and taking advantage of the opportunities presented by globalisation. In this context, they identified trade, particularly representation at the WTO, and graduation policies as areas that required particular attention and welcomed the donor support for small states representation at the WTO, particularly the A$250,000 pledged by the Australian Government.

A New Agenda for Commonwealth Work on Small States

6. The Group welcomed the proposals for future Commonwealth work on small states' issues set out in a paper prepared with the help of the Advisory Group on Advancing the Small States Agenda. They agreed that the Commonwealth can be most effective by working in partnership with other relevant international institutions, and requested that the Secretariat continues to do so. They stressed the importance of co-ordination and co-operation among the various agencies to avoid duplication.

7. Ministers identified the following priority issues for immediate Commonwealth action over the months ahead.

  • Assistance on trade issues. Following the agreement in Doha on a new WTO work programme on small states issues, the Secretariat should continue to work closely with Commonwealth members, the WTO and with other donors to strengthen the level of WTO support for its small state members, further strengthen small states' representation at the WTO, and provide assistance to individual states and regional organisations in building capacity to negotiate and implement WTO agreements.

  • Promoting dialogue on the OECD Harmful Tax Practices Initiative. The Secretariat should continue work under its mandate to promote dialogue between the Organisation for Economic Co-operation and Development (OECD) and non-OECD jurisdictions in this area, taking into account the OECD's attempt to respond to earlier concerns. The Secretariat should support the affected jurisdictions to mobilise assistance to meet international standards, strengthen and deepen their financial sectors and diversify their economies. The need to distinguish clearly between money laundering and tax competition was highlighted.

  • Action to help mitigate the impact on small states of the events of September 11th and their aftermath, which are having a highly damaging impact on the economies of many small developing states. It will be particularly important for the Secretariat to work with partner institutions like the World Bank to encourage them to recognise the special impact on many small economies, and to provide relevant assistance. The Secretariat should also be ready to provide assistance with implementing stronger anti-terrorism measures such as those required under UN Resolution 1373, guided by decisions taken by Heads of Government on the Plan of Action recommended by the Commonwealth Ministerial Committee on Terrorism

  • World Summit on Sustainable Development (WSSD) and UN Conference on Financing for Development. The Secretariat should identify elements of follow up to the conclusions of the forthcoming UN Conference on Financing for Development that are most relevant to small states, and seek to mobilise support for taking them forward. It was noted that the Commonwealth stands to gain from a comprehensive and ambitious WSSD summit agenda, one that strengthens the social, economic and environmental pillars of sustainable development. Ministers looked for outcomes from the WSSD dedicated to poverty eradication, health, regional initiatives for small island developing states, and sectoral initiatives on oceans, energy and fresh water.

8. Looking beyond these immediate issues, Ministers suggested that the Secretariat's medium term programme of work on small states issues should attach high priority to the following areas, taking into account the Secretariat's comparative advantage, limited resources and the need to avoid duplication of the extensive work of other organisations.

  • Providing stronger advocacy. The Secretariat should continue its efforts to use the results of its own and other relevant research to demonstrate the special vulnerability of small states. In this respect, it will be important to maintain pressure on other international institutions to implement fully recommendations of the Commonwealth Secretariat/World Bank Joint Task Force'

  • Attracting private investment. The Secretariat should initiate consultations with the relevant IFIs and donors to secure greater recognition of the special difficulties faced by many small states in this respect, and to encourage an atmosphere conducive to increasing private investment in small and medium sized enterprises in developing small economies

  • Addressing the impact of global initiatives, and assistance with capacity building. Global initiatives and rules such as WTO rules and procedures, the pressing issues covered by the UN Framework convention on climate change, the new security measures required to comply with UN Resolution 1373, and actions to counter money-laundering, international tax crime, terrorist financing, drug trafficking and other transnational crimes affect all countries, advanced as well as developing. But the Secretariat should take action to draw attention to the particular implications of some of these initiatives for the economies of many small states, as well as to the special challenges they face in building capacity to implement them.

9. Other areas mentioned by Ministers included:

  • Disaster mitigation and insurance. New ideas for disaster mitigation and insurance are being developed in the private sector, in the multilateral institutions, such as the World Bank, and in some small states. The Secretariat could develop a programme to help small states understand these new ideas and take advantage of them.
  • Promoting regional approaches. The Secretariat should explore whether it can play a role in promoting regional approaches, for example by helping small states and their regional organisations to compare experiences and develop good practice.


Novotel Twin Waters Resort
Coolum
Australia

1 March 2002

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