South South Cooperation: Origins and trends

1. South South Cooperation: Origins and trends Richard Kozul-Wright UNCTAD, Unit on EICDC December 2010

2. South SouthCooperation • A (short) history of South South cooperation • Terminology • Recent trends • Back to the future? The 1970s vs the 2000s INTERMISSION • A Lewis moment? A Global perspective on the rise of the south • South South interdependence: Why policy space still matters • Productive integration: East Asian Lessons • Monetary and financial cooperation:a missing link? • The South is Dead: Long Live the South!

3. South SouthTimeline 1945 Formation of Arab league 1955 Asian-African Conference in Bandung, Indonesia 1960 Latin America Free Trade Area (LAFTA) OPEC 1961 Non-Aligned Movement (NAM) 1963 Organization of African Unity (OAU) 1964 First United Nations Conference for Trade and Development + G77 established 1967 Association of Southeast Asian Nations (ASEAN) 1968 UNCTAD ECDC unit 1969 Andean Community 1973 Caribbean Community (CARICOM) 1974 UN General Assembly adopts Declaration for the Establishment of a NIEO Special Unit to Promote Technical Cooperation among Developing Countries (TCDC) by UNDP 1975 Economic Community of West African States (ECOWAS) 1976 Mexico City conference on ECDC; GSTP launched 1978 UN Conference on South South Cooperation, Buenos Aires 1981 High-Level Conference of the G-77 in Caracas Venezuela Caracas Programme of Action on ECDC Collapse of NIEO 1985 South Asian Association for regional Cooperation 1987 The South Commission established 1988 GSTP entered into force 1991 Mercosur 1994 Common Market for Eastern and Southern Africa (COMESA) 2000 Ministerial Conference of the Forum on China-Africa Cooperation (FOCAC) held in Beijing. First South Summit in Havana, Cuba • OAU formally adopted the NEPAD • IBSA Forum. UN General Assembly declares 19 December, UN Day for South-South Cooperation Marrakech Declaration on South-South Cooperation 2005 Second South Summit Doha, Qatar 2007 Bank of the South 2008 UNCTAD XII, Accra, Ghana Africa India Summit held in New Delhi, India 2009 UN High Level Conference on on South South Cooperation Nairobi 2010 Ratification of the constitutive treaty of Unasur Sao Paulo GSTP round signed (December)

4. UNCTAD’S Role • UNCTAD was the lead organisation to South South Cooperation beginning from 1964 • It focused on the regional economic • It involved in a very wide ranging research agenda, not just on trade issues (e.g. financial arrangement) • It involved in a heavy discussion on South South Cooperation issues during 1960-1970

5. Twists and terms 1 • Economic Integration

6. MAIN CHARACTERISTICS OF DIFFERENT TYPES OF TRADE INTEGRATION ARRANGEMENTS Reduction Elimination Common of tariffs in of tariffs in tariffs for Harmonization intraregional intraregional the rest of Free factor of economic trade trade the world mobility policies Preferential trade agreement Yes Free trade agreement Yes Customs union Yes Yes Coordination desirable Common market Yes Yes Yes Coordination desirable Economic union Yes Yes Yes Yes • Source: UNCTAD secretariat.

7. Twists and terms 2 • Development cooperation • South South cooperation

8. Twists and terms 3 • Economic cooperation among developing countries (ECDC) • Technical cooperation among developing countries (TCDC)

9. Twists and terms 4 • Triangular cooperation • North and South

10. South-South Trade Volumes, US$

11. South-South trade by region Test 2009 Source: ECIDC,UNCTAD based on UNCTADstat.

12. FDI from developing regions, US$

13. Evolution of South-South FDI:1990-2006 Note: * Calculation excludes Cayman Islands, British Virgin Island and Hong Kong (China).

14. Net transfer of financial resources to developing economies and economies in transition, 1997-2009

15. Sovereign Wealth Funds with over $100 billion

16. Global migrant stocks, 2005 (millions) Source: World Bank staff calculations based on migration data from University of Sussex, United Nations, and World Bank

17. Factors for GrowingIncreased of South SouthEconomicConnection • Trade • Foreign Direct Investment • Financial flows • Labour flows

18. South SouthCooperation 1970 1970: last golden age of South Southcooperation Source: ECIDC Unit, based on UNCTADstat.

19. Geographical composition of world exports:1970 and 1980 Source: ECIDC Unit, based on UNCOMTRADE. Note: EU 15 includes, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden and the United Kingdom. MENA includes the Middle East and North African Countries. NIC only includes, Hong Kong, South Korea and Singapore. China’s share of world exports corresponds to the earliest available figure in UNCOMTRADE, 1984.

20. Geographical composition of world exports:1996,2006 and 2009 Source: ECIDC Unit, based on UNCOMTRADE. Note: EU 15 includes, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden and the United Kingdom. MENA includes the Middle East and North African Countries. Hong Kong, South Korea and Singapore.

21. Average growth rates:selected countries Source: ECIDC Unit, based on UNCTADstat.

22. Distribution of global output

23. Differences within the south?

24. Final Thoughts • Exportingeconomies VS Bigeconomies • Converting VS Catch up • Dependance Vs Decoupling

25. Decoupling