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REPORT
ON THE
INTERNATIONAL WORKSHOP ON ECONOMIC VULNERABILITY
AND RESILIENCE OF SMALL STATES
organised by the
COMMONWEALTH SECRETARIAT, London
ECONOMICS DEPARTMENT, University of Malta
ISLANDS AND SMALL STATES INSTITUTE Foundation for International Studies, University of Malta
at the University of Malta Gozo Centre
Mgarr Road, Xewkija, Island of Gozo, Malta
on 1, 2 and 3 March 2004
1. VENUE, DATE AND ORGANISERS
The international workshop on Vulnerability and Resilience of Small
States was held at the University Gozo Centre, Xewkija, island
of Gozo,
Malta, between 1 and 3 March 2004. The workshop was organized by the
Commonwealth Secretariat, the Economics Department
of the University of Malta
and the Islands and Small States Institute of the Foundation for International
Studies, at the University
of Malta. The persons involved in the coordination
and administration of
the workshop are listed in Annex 1.
2. OBJECTIVES OF THE WORKSHOP
The objectives of the workshop were to:
• Identify the inherent conditions and factors that lead to economic vulnerability of small states.
• Propose measures which strengthen resilience to enable small states
to manage their inherent economic vulnerability, and a
framework to
operationalise such measures.
• Examine the existing vulnerability indices and propose methods to develop a resilience index.
• Propose measures that enhance the benefits of the economic
vulnerability and resilience indices, in terms of supporting
decision-making,
setting targets and establishing standards, monitoring and evaluating
developments, providing quantitative
estimates, disseminating
information.
• Issue a statement on economic vulnerability and resilience building of small states
• Plan a publication containing the papers presented at the workshop
and the final statement agreed upon by the participants.
3. STRUCTURE OF THE WORKSHOP
The workshop was structured as follows. The first day was dedicated to
presentations by invited experts on the need for special
treatment for small
states and on themes related to inherent conditions leading to economic
vulnerability of small states in different
regions and on policies and measures
which strengthen economic resilience of small states.
The second day was dedicated to presentation on the conceptual and
methodological issues in measuring vulnerability and economic resilience,
with a
view of making a case for special and differential treatment for small
states.
The third day was dedicated mostly to the drafting and approval of a final
statement..
1
The workshop was also addressed by the Hon John Dalli, Minister of Finance
and Economic
Affairs, Government of Malta and Ms Giovanna Debono, Minister for Gozo,
Government of Malta.
The programme of the workshop is presented in Annex 2.
There was also a social programme, which is presented as Annex
3.
4. PARTICIPANTS
The workshop was attended by 26 participants from different parts of the
world. A list of
participants is appended as Annex 4.
The Pacific, the Caribbean and the AIMS regions were almost equally
represented. Some participants represented international or
regional
organisations including the Commonwealth Secretariat, the Pacific Island Forum,
UNCTAD, UN Department of Economic and Social
Affairs
(UNDESA), the Caribbean Regional Negotiating Machinery (CRNM), the UN
Committee for
Development Policy, the UNDP and the UK Department for International
Development (DFID).
5. PROCEEDINGS
The workshop presentations followed a logical sequence, with problems and
prospects being treated first, followed by a discussion
on concepts and
measurements, leading to the drawing up of a final statement, covering the
issues discussed. The contribution of
the participants was of a very high
quality, and all participants participated actively in the debate.
The final statement, presented as Annex 5, was unanimously approved, following intense debate on its content and on the messages to be conveyed. In general the participants agreed that small states, particularly SIDS, are more economically inherently vulnerable than other groups of countries, and that resilience-building is imperative to cope with such vulnerability. It was also agreed that small states should themselves adopt policies to build their resilience through:
(a) good governance involving appropriate policies to ensure political stability and the enforcement of the rule of law, to address the issue of corruption, as well as to promote accountability, transparency and efficiency in the delivery of public services;
(b) a sound macroeconomic framework, including low inflation, exchange rate
stability, and acceptable fiscal and external balances;
2
(c) market reform by promoting fair trade practices and fostering competitiveness;
(d) labour productivity and labour market flexibility with the
collaboration and participation of social partners and other relevant
stakeholders;
(e) social cohesion, poverty eradication and sustainable livelihoods;
(f) protection and sustainable management of the environment, notably by
taking steps to increase energy efficiency, promote waste
management, improve
freshwater resources management, and encourage sustainable use of biodiversity
and natural resources; and
(g) innovation, research and technology as sources of
competitiveness.
Participants called upon the international donor community to assist small
island states in their quest to build economic resilience
in order to cope with
their inherent economic vulnerability.
Participants also agreed that a construction of a resilience index is
important as a tool for assessing the extent to which countries
are building
their resilience and as a checklist as to what is to be done towards this
end.
6. FUTURE WORK
Participants recognised the importance of a rigorous framework on
resilience-building, and agreed on the need for the work
to continue towards
developing a resilience index as well as a broader set of tools to support
national and regional policy making.
7. ACKNOWLEDGMENTS
Participants expressed their gratitude to the Government of Malta and the
University of Malta for their kind hospitality and warm
welcome and for creating
congenial conditions for a successful meeting.
The participants also thanked the Minister of Finance and Economic Affairs
and the Minister for Gozo for their contributions to the
deliberations, and the
support expressed by both ministers in promoting measures in favour of small
states.
The participants requested the Government of Malta to submit these workshop
conclusions to the
Secretary General of the UN for circulation as an official document of the
UN.
8. EVALUATION
3
In general the participants considered the workshop to have been well-organised and fruitful.
The evaluation results are shown in Annex 5. In general, 21 out of 24
participants (86%) rated the workshop as excellent or very good.
Out of the
remaining 14% of participants, 13% rated the seminar as good and 1% as
fair.
Participants added comments to the evaluation questionnaire, generally
commenting on the hospitality offered by the University Gozo
Centre and on the
good service extended by University Gozo Centre
staff.
4
ANNEX 1:
WORKSHOP COORDINATION AND ADMINISTRATION
Overall coordination:
Professor Lino Briguglio, University of Malta
Dr Eliawony Kisanga and Ms Janet Strachan, Commonwealth Secretariat
Secretariat:
Mr MaryRose Vella, Ms Romina Carabott,
Islands and Small States Institute, St Paul Street, Valletta, VLT07, Malta.
Tel: +356 21248218; Fax: +356 21248218. email: islands@um.edu.mt
Ms Constance VIGILANCE, Senior Programme Officer, Economic Affairs Division, Commonwealth
Secretariat, Pall Mall, London SW1Y 5HX, United Kingdom. Tel : +44 207 7476128 Fax: +44 207
7476235; Email: C.Vigilance@commonwealth.int
Travel arrangements: Ms Ruth Grech
Economics Department, University of Malta, Msida, MSD06, Malta
Tel: +356 21340335; Fax: +356 21340335. email: economics@um.edu.mt
Transfers: Ms Mikela Tabone
Ministry of Foreign Affairs, Merchants Street, Valletta, CMR 02, Malta
Tel: +356 21242191; Fax: +356 212378222; email:
mikela.tabone@gv.mt
Logistics and accommodation:
Mr Joseph Calleja and Mr Marvin Grech University Gozo Centre, Mgarr Road, Xewkija, Gozo, Malta
Tel: +356 21564559; Fax: +356 21564550. email:
ugc@um.edu.mt
5
ANNEX 2:
WORKSHOP PROGRAMME
MONDAY 1 MARCH 2004
Inauguration
0900-0945 Leslie Agius, Chief Executive, Foundation for International Studies
Martin Valentino, Ministry of Foreign Affairs, Malta
Lino Briguglio, University of Malta
Eliawomy Kisanga, Commonwealth Secretariat
Jagdish Koonjul, Chairman of AOSIS
Keynote Speech followed by discussion
1000-1100 “Making a case for special treatment of small states”
Siva Palayathan
Presentations followed by discussion:
“Inherent conditions leading to economic vulnerability of small states
and appropriate policy measures to strengthen economic
resilience for
sustainable development”
1130-1230 “Small states in the Caribbean region”
Dr Philip Osei, Dr Dennis Pantin, Mr Cletus Springer
1400-1500 “Small states in the Pacific region”
Dr Mahendra Reddy, Mr Mike Manning, Mr Espen Ronneberg
1500-1600 “Small states in the AIMS region”
Peter Larose, Abdullah Majeed, Peter Wilson
1630-1730 Plenary discussion:
“Policies and measures to strengthen the economic resilience of small
states”
TUESDAY 2 MARCH 2004
0900-1030 Presentation followed by discussion:
“Background information about the development of the economic vulnerability index”
Lino Briguglio
1100-1230 Presentations followed by discussion:
“Measuring economic vulnerability and resilience to operationalise vulnerability and resilience indices”
Gordon Cordina
Tom Crowards
1400-1600 Presentations by representatives of International/regional organisations
Pierre Encontre, UNCTAD
Emma Ferguson, Pacific Islands Forum Secretariat
Patrick Guillaumaunt, UN Committee for Development Planning
6
1600-1630 Speech by Hon. John Dalli, Minister of Finance and Economic Affairs, Malta
“Promoting Competitiveness in Malta”
1630-1800 Presentations by representatives of International/regional organisations
Racine Kane, UNDP
Claudius Preville, Caribbean Regional Negotiating Machinery
Ram Venuprasad, Commonwealth Secretariat
John Underwood, World Bank
WEDNESDAY 3 MARCH 2004
0900-0915 Speech by Hon. Giovanna Debono, Minister for Gozo, Malta
“Economic Vulnerability and Resilience Building on the Island of
Gozo”
0915-1100 Drafting of final statement:
“Measures to manage economic vulnerability and strengthen economic
resilience of small states”
1130-1230 Plenary session to draft final statement.
1400-1700 Discussion and adoption of final statement
1700 End of
Workshop
7
ANNEX 3:
SOCIAL PROGRAMME
Monday 1st March 2004
1230 Lunch at Xerri l-Bukkett Restaurant
2000 Dinner at Il-Kartell Restaurant
Tuesday 2nd March 2004
1230 Lunch at Ta’ Rikardu Restaurant, Victoria
Wednesday 3rd March 2004
1230 Lunch at Mariblu Restaurant
1700 Visit to Ggantija prehistoric temples at
Xaghra
8
ANNEX 4:
WORKSHOP PARTICIPANTS
Professor Lino BRIGUGLIO, Director, Islands and Small States Institute, Foundation for
International Studies, University of Malta, St Paul Street, Valletta, VLT07, Malta. Tel: +356
21340335; Fax: +356 21340335; Email: lino.briguglio@um.edu.mt
Mr Gordon CORDINA, Economics Department, Post Graduate Programmes Coordinator, University of Malta, Msida, MSD06, Malta. Tel: +356 21340335; Fax: +356 21340335;
Email: Gordon.cordina@um.edu.mt
Mr Tom CROWARDS, Team Leader, Macroeconomics, Policy Division, Department for
International Development (DFID), 1 Palace Street, London SW1E 5HE, United Kingdom. Tel:
+44 20 7023 0075 ; Fax: +44 20 7023 0019; Email:
t-crowards@dfid.gov.uk
Mr Pierre ENCONTRE, Special Programme on the Least Developed Countries, and Land-locked and Island Developing Countries, UNCTAD, Geneva. Tel: +41 22 907 6220; Fax: +41 22 917
0046; Email: pierre.encontre@unctad.org
Ms Emma FERGUSON, Economic Adviser, Pacific Islands Forum Secretariat, Private Mail Bag
Suva, FIJI. Tel: (679) 322 0318 Fax: (679) 330 0192; Email:
Emmaf@forumsec.org.fj
Prof. Patrick GUILLAUMONT, CERDI, Université d'Auvergne, 65, bd Francois Mitterrand, BP 320,
63009 CLERMONT-FERRAND cdx 1, France. Tel. 04 73 17 74 00, Fax. 04 7317 74
28. Email: P.Guillaumont@u-clermont1.fr
Mr Racine KANE, M. Racine KANE, Programme Officer, United Nations Development Programme
(UNDP), Sénégal-Capacity 21 BP: 154, Dakar, Senegal. Tel: +221 8640522; Fax: +221 8640522
Email: racine.kane@undp.org
Dr Eliawony KISANGA, Deputy Director, Economic Affairs Division, Commonwealth
Secretariat, Pall Mall, London SW1Y 5HX, United Kingdom.
Tel : +44 207 7476128
Fax: +44 207 7476235; Email: E.Kisanga@commonwealth.int
H. E. Jagdish KOONJUL, Permanent Representative of the Republic of Mauritius to the United
Nations, 211 East 43rd Street, 15th Floor, New York, NY 10017, Tel: (212) 949-0190. Tel: (212)
949-0190; FAX: (212) 697-3829; Email: jkoonjul@yahoo.com
Dr Peter LAROSE, General Manager, Central Bank of Seychelles, P .O. Box 701,
Victoria, Mahe, Seychelles. Tel: +248 225200; Fax:
+248 224958; Email:
GM@cbs.sc
Hon Abdullah MAJEED , Deputy Minister of Home Affairs and Environment,
Government of the Maldives, Mahe, Maldives. Tel: +960 324861;
Fax: +960
322286; Email: Amjad.abdulla@ environment.gov.mv
Mr Mike MANNING, Institute for National Affairs, Port Moresby,Papua New Guinea. Tel: + 675
3211045; Email: inapng@daltron.com.pg
Dr Philip OSEI, Research fellow, Sir Arthur Lewis Institute of Social &
Economic Studies, University of the West Indies, Mona,
Jamaica. Tel: +1 876
927-1020 Fax: +1 876 927-2409. E-mail:
philip.osei@uwimona.edu.jm
9
Dr Roderick PACE, Director, European Documentation and Research Centre,
University of Malta, Msida, MSD07, Malta. Tel: +356 23402116;
Fax: (+356)
21337624, Email: roderick.pace@um.edu.m
Dr Dennis PANTIN, Sustainable Economic Development Unit for Small Island
Developing States, University of the West Indies, St Augustine
Campus, Trinidad
And Tobago. Tel. + 868 662-6555; Fax: + 868 662-6555; Email:
dpantin@hotmail.com
Mr Siva PALAYATHAN, Commercial Advisor, Mission of Mauritius to the United Nations in Geneva,
7, Chemin Louis-Dunant, 1202 Genève. Tel. +41 22 7348550; Fax +42 22 7348630
Email: apalayat@worldcom.ch
Dr. Claudius PREVILLE, CRNM/CIDA Trade Support Project, 5th Floor, Citibank Building, 63, Knutsford Boulevard, Kingston 5, Jamaica W.I.. Tel: 876 754 7989-91 or 876 960 5928; Fax: 876
754 7988, Email: Claudius.preville@crnm.org
Dr Mahendra REDDY, Centre for Development Studies, University of the South
Pacific Laucala Bay Road, Suva, Fiji Islands. Tel: +679
321 2297; Fax: +679
330 3040; Email: reddy_m@usp.ac.fj
Mr Espen RONNEBERG, Inter-regional Advisor for SIDS, United Nations
Department of Economic and Social Affairs (UNDESA), One UN Plaza,
New York, NY
10017, USA. Tel: +1 212 963 2043; Fax: +1 212 963 4340; Email:
ronneberg@un.org
Mr Cletus SPRINGER, Advisor, UNDP Task Force on Vulnerability, Impact
Consultancy Services Inc. P.O. Box 1410, Castries, St. Lucia.
Tel: +758 452
1007; Fax: +758 452 1007; Email: springerc@candw.lc
Ms Janet STRACHAN, Chief, Sustainable Development, Economic Affairs Division, Commonwealth
Secretariat, Pall Mall, London SW1Y 5HX, United Kingdom. Tel : +44 207 7476128 Fax: +44 207
7476235; Email: J.Strachan@commonwealth.int
Mr John UNDERWOOD, Director, Operations Policy and Country Services , The World Bank, 1818
H Street NW, Washington, DC 20433, USA. Tel: +1 202 473 3911; Fax: +1
202 522 7499; Email: junderwood@worldbank.org
Mr. Ram VENUPRASAD, Special Advisory Services Division (SASD), Commonwealth
Secretariat, Quadrant House, 55-58 Pall Mall, London,
SW1Y 5HX, United Kingdom,
Tel: + 442077476306; Fax: +44 2077476307; Email:
R.Venuprasad@Commonwealth.int
Ms Constance VIGILANCE, Senior Programme Officer, Economic Affairs Division, Commonwealth
Secretariat, Pall Mall, London SW1Y 5HX, United Kingdom. Tel : +44 207 7476128 Fax: +44 207
7476235; Email: C.Vigilance@commonwealth.int
Dr. Edward WARRINGTON, Director, Institute of Public Administration & Management, University of Malta, Msida, MSD07, Malta. Tel: +356 23402730; Fax:
Email: edward.warrington@um.edu.m
Dr Peter R. D. WILSON, Associate Professor, Economics Department, National University of
Singapore, Kent Ridge Crescent, Singapore, Singapore. Tel: +65 68743997; Fax: + 65
67752646; Email: ecspeter@nus.edu.sg
10
ANNEX 5:
FINAL STATEMENT
CONCLUSIONS OF THE INTERNATIONAL WORKSHOP ON ECONOMIC VULNERABILITY AND RESILIENCE OF SMALL STATES Organised by the Commonwealth Secretariat and the University of Malta
at the University Gozo Centre, Island of Gozo, Malta, 1-3 March
2004
Introduction
1. Twenty-six experts from all Commonwealth regions participated in a
workshop on economic vulnerability and resilience of small states
held at the
University Gozo Centre, Malta, between 1 and 3 March 2004. These included
academics, practitioners, policy makers, and
representatives of international
and regional organizations.
2. This workshop took place in the context of preparations for the
International Meeting for the review of the implementation
of the Barbados
Programme of Action for the Sustainable Development of Small Island
Developing States (SIDS). The workshop
discussed features of economic
vulnerability of small states, particularly SIDS, and strategies for developing
their resilience;
and took account of the conclusion of the ad hoc expert
group on Vulnerability Indices, which met in New York in December 1997,
that
“as a group, SIDS are more vulnerable than other groups of developing
countries”. The participants also discussed
trade as the main engine of
growth and development.
3. Participants noted that:
• the regional preparatory meetings for the International Meeting, held in Samoa, Cape Verde and Trinidad and Tobago, confirmed that SIDS, as a group, face particular handicaps as a result of the economic, environmental and social vulnerability.
• the Interregional Preparatory Meeting of SIDS, held in Nassau, The Bahamas in January
2004, reconfirmed the economic vulnerability of SIDS and called for the
development of an economic resilience index.
4. The participants also considered a number of issues that are of concern to small states, notably:
• the issue of graduation from least developed country (LDC) status of a number of SIDS;
and
• the need for special and differentiated treatment and necessary
policy space for small states, particularly SIDS, within the
World Trade
Organization (WTO).
5. Participants recognized the role that a focused conceptual framework on
vulnerability and resilience building could play in addressing
these concerns,
as well as in strengthening national and regional policy approaches. They also
recognized the need for participatory
and collaborative schemes, involving all
major stakeholders, to ensure the success of resilience strategies.
Vulnerability and resilience of small states
6. The participants reaffirmed that the inherent economic vulnerabilities of
small states have been internationally recognized. Such
vulnerability arises
from exposure to adverse external shocks beyond their control, as well as
structural handicaps, exacerbated
by inter alia a high
11
degree of openness, export concentration and high dependence on strategic
imports, remoteness and high transport costs, susceptibility
to natural
disasters exacerbated by climate change and sea level rise. These conditions
pose serious handicaps for the
sustainable economic development of
small states.
7. Small states have not been complacent in this regard, and there are many
instances of successful practices to build resilience
that could be emulated.
In this regard, technical and financial assistance and cooperation from
the international community
is of paramount importance to support efforts
of small states to build their capacity to cope with their vulnerability and to
build up resilience.
Recommendations for small states
8. In order to build resilience, small states should:
(h) take steps to promote good governance by pursuing appropriate policies to ensure political stability and the enforcement of the rule of law, to address the issue of corruption, as well as to promote accountability, transparency and efficiency in the delivery of public services;
(i) strive to create a sound macroeconomic framework, including low inflation, exchange rate stability, and acceptable fiscal and external balances;
(j) undertake market reform by promoting fair trade practices and fostering competitiveness;
(k) enhance labour productivity and labour market flexibility with the collaboration and participation of social partners and other relevant stakeholders;
(l) promote social cohesion, support poverty eradication and sustainable livelihoods and foster harmonious social development;
(m) protect and sustainably manage the environment, notably by taking steps to increase energy efficiency, promote waste management, improve freshwater resources management, and encourage sustainable use of biodiversity and natural resources; and
(n) promote innovation, research and technology as sources of
competitiveness.
9. In this context the usefulness of a resilience index should be
explored.
Regional and international dimensions
10. The negotiating capacity of small states, particularly SIDS,
should be enhanced by appropriate analytical tools,
such as
vulnerability indices. The support of regional and international
organizations would strengthen this process.
11. The work carried out by the Alliance of Small Island States (AOSIS) in
formulating a collective position for SIDS in international
fora, in particular
those where international instruments are negotiated, should be supported.
Furthermore, the progress made in
formalizing the AOSIS structure was
welcomed.
12. Participants commended the work of the Commonwealth Secretariat to foster
co-ordination among small states in their efforts to
be considered as meriting
special treatment within the WTO and the World Bank.
13. Participants expressed their gratitude to the international and
regional organisations that have supported efforts by small
states to promote
their sustainable development. They were also appreciative of the work
carried out by Universities and
research institutions, notably the
University of Malta, the University of the West Indies and the University of the
South Pacific,
in
12
the interests of small states. Participants urged the continuation of this
work within the context of the proposed SIDS University
Consortium.
Recommendations for the international community
14. Participants urged the:
a) UN Commission for Sustainable Development to take note of the conclusions of the workshop at its preparatory meeting for the Mauritius International Meeting (14 to 16
April 2004), and to request the international donor community to support SIDS in their resilience-building efforts;
b) Relevant UN agencies, including the UN Workshop on Trade and Development
(UNCTAD), the UN Development Programme (UNDP) and the UN Environment Programme (UNEP), to continue providing support to small states, particularly SIDS, towards the promotion of sustainable development in general and resilience building in particular;
c) International donor community, including multilateral financial organizations, to extend financial and technical support to small states in their efforts to cope with their inherent vulnerability and to build their resilience;
d) The WTO to take account of the special trade concerns and needs of
small states, particularly SIDS, and their vulnerabilities
arising from
trade liberalisation and globalisation, and accordingly consider granting
special and differentiated treatment to
such states.
Future Work
15. Recognising the importance of a rigorous framework on
resilience-building, participants agreed on the need for the work to
continue
towards developing a resilience index as well as a broader set of tools to
support national and regional policy making.
Acknowledgments
16. Participants expressed their gratitude to the Government of Malta and the
University of Malta for their kind hospitality and warm
welcome and for creating
congenial conditions for a successful meeting.
17. The participants also thanked the Minister of Finance and Economic
Affairs and the Minister for Gozo for their contributions to
the deliberations,
and the support expressed by both ministers in promoting measures in favour of
small states.
18. The participants requested the Government of Malta to submit these
workshop conclusions to the Secretary General of the UN for
circulation as an
official document of the
UN.
13
ANNEX 5:
EVALUATION RESULTS
Item Excellent Very
Good
RESPONSE
Good Fair Bad Very
bad
Total
Programme 18 3 3 - - - 24
Presentations 12 7 5 - - - 24
Conference Facilities 15 4 4 1 - - 24
Transport Facilities 14 5 5 - - - 24
Assistance by Staff 20 4 - - - - 24
Social Activities 16 6 2 - - - 24
Hotel 17 4 3 - - - 24
Average 16.0 4.7 3.1 0.1 - - 24
Percentage 66% 20% 13% 1% - - 100%
14
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