Global Initiative on Commodities on the agenda

01 Jun 2007

A “Global Initiative on Commodities” Conference organised by the Common Fund for Commodities (CFC), United Nations Conference on Trade and Development (UNCTAD), UNDP and the Secretariat of the African, Caribbean and Pasific Group (ACP) was held on 7-11 May in Brazil to address problems in commodity exchange and how new commodity strategies could be designed to fight for poverty reduction.

New Horizons - The meeting brought together various governments and NGOs as well as representatives from the private and public sector and was realized under the auspices of Brazilian Ministry of Agriculture.

As international trade continues to constitute an important part of globalization, new technologies and techniques are designed to compensate for the increasing demands of developed countries. While growing needs of dynamic economies due to tight supply capacities and tense geopolitical conditions have helped some countries in Africa to grow out of their economic stagnation, for many other countries the situation has only brought new challenges and problems. Today, commodities and especially agricultural products account for more than half of all export income in 86 developing countries. Unfortunately these countries do not and can not benefit from the gains of their own commodities as much as other rising economies as they are often at a disadvantage in price negotiations against large corporations and mostly uninformed of developments. Increased demands mean increased production which should theoretically mean increased profits but the unbalanced distribution of profits end up in higher markets where they are commercialized leaving commodity-dependent countries in a state of poverty as they cannot use profits to improve their own economies.

The “Global Initiative on Commodities” Conference that was held in Brazil aimed to find solutions for such problems in which the participants discussed the measures that need to be taken at national and international levels such as new financing methods and changes in policies. The problems that led agricultural producers to lose their gains were addressed as inadequate infrastructure such as transportation, lack of storing facilities and loans, low productivity due to a fallback from technological developments and lack of other support services. The importance of dynamic economies including strategies to eradicate poverty was emphasized. Some of the points that were brought up to increase awareness on this situation were:

  • Better understanding of commodity issues at a global level and influencing the global community such as governments, international organizations, civil society, other citizens and the private sector in revising their strategies,
  • Re-launching the commodities agenda from a poverty reduction point of view taking into account recent developments such as technological changes,
  • Designing global strategies for capacity building,
  • Building local and regional clusters to enhance competitiveness and capacity to better compete with global trends,
  • And most importantly placing commodity producers at the centre of development strategies so that they too can benefit from commodity trade.

Bearing in mind that the world is at a mid-point for the 2015 deadline for realizing the UN MDGs, the Conference in Brazil played a key role in addressing matters of poverty reduction and global partnership. During the meeting the governments were represented by senior officials and problems for all commodities including agriculture, fisheries and forestry except for oil were discussed.