50 per cent of the people in the least developed countries (LDCs) live on less than US $1 a day. In 2000, this group totalled 334 million. By 2015, they could be 471 million
Such poverty levels limit their ability to generate domestic resources. In 28 LDCs, the ratio of gross capital formation to gross domestic product (GDP) rose from 20.2 per cent in 1998 to 23 per cent in 2002 and the domestic savings rate from 4.4 per cent to 4.8 per cent. The rest of the 18.2 per cent of GDP in 2002 came from external sources
But will the UNCTADs development strategy work?
The UN Conference on Trade and Development (UNCTAD) proposes a
development-oriented approach would ensure that international trade works for poverty
reduction. It offers a three-pronged strategy that must be mutually supportive of each
Include trade as a
central component in the formulation and implementation of least developed nations
Improve global trade
regime to reduce constraints they face
financial and technical assistance to develop their production and trade capacities
External indebtedness is rising. In 2002, the external debt stock of 43 countries rose by US $8 billion over 2001 levels and debt servicing reached a record level of US $5.1 billion
Grants, too, are now used to provide basic services. The proportion of bilateral aid for developing productive sectors , economic infrastructure and agriculture fell by around 50 per cent over two decades from 1980 levels
Even their last resort, export revenues, is being eroded. 67 per cent of the merchandise exports in 31 nations comprises primary commodities. From 1980 to 2003, prices of food items fell by 73.3 per cent, agri-raw materials by 60.7 per cent and minerals by 59.5 per cent
Had prices of these commodities remained at 1980 levels , the LDCs would have earned an additional US $1.2 billion. Of this, US $312 million would have accrued to the coffee exporters, US $386 million to cotton exporters and US $751 million to mineral exporters
Domestic savings do not match investment needs
|Sao Tome and Principe
|All figures are a percentage of gross
domestic product (GDP)
*Measured by GCF less GDS; **Simple average based on the 28 LDCs for which data were
available for the 19982002 period
Note: Data for all countries are not available. The number of countries for which data was available has been specified above in each case.
Source: Anon 2004, The Least Developed Countries Report 2004, United Nations Conference on Trade and Development, New York and Geneva
We are a voice to you; you have been a support to us. Together we build journalism that is independent, credible and fearless. You can further help us by making a donation. This will mean a lot for our ability to bring you news, perspectives and analysis from the ground so that we can make change together.