Statement by Amb. J. Enkhsaikhan,
Permanent Representative of Mongolia
in the plenary of the fourth Meeting of Governmental Experts from
Land-locked and Transit Developing Countries and Representatives
of Donor Countries and Financial and Development Institutions
New York,  24 August, 1999

Mr. Chairman,

At the outset, allow me to congratulate you on your election as Chairman of this meeting and other members of the Bureau and wish you all the success. We are certain that under your able leadership our work will be steered to a successful conclusion.  I would like also to express our appreciation to UNCTAD, Ms. Anna  Tibajuka and her small, hard working staff for preparing informative reports and useful  background papers.

In the past two years since the Third Intergovernmental expert meeting, a number of important developments have taken place at various subregional, regional and international levels, as reflected in the reports prepared by UNCTAD and the reports on regional consultations  held yesterday. However, the process of globalization and liberalization is affecting the LLDCs, mainly by marginalizing  most of them. The statistical data prepared by UNCTAD for the purpose of this meeting shows that over-all no real progress has been marked in the transit transport  situation of LLDCs since 1997. Thus hardly the high transit transportation costs have been reduced, although provisions calling for special attention to, greater support and assistance by the international community to the development needs of the LLDCs have been duly reflected in General Assembly resolutions and in the final documents of some important international fora.  This year the General Assembly is expected to adopt a resolution on the questions of LLDCs, which I hope would realistically assess the situation as well as guide us to a more fruitful and practical cooperation at the beginning of  the new millennium.

Effective implementation of the provisions of the 1995 Global Framework for Transit Transport Cooperation between Land-Locked and Transit Developing Countries and the Donor Community, would, in my delegation’s view, indeed make a concrete contribution to improving the situation of  LLDCs. This optimism of my delegation is based on the following  2 important facts:  a) the  Global Framework was adopted on the basis of agreement between all three groups of countries and  b) that its implementation would benefit not only the LLDCs, but due to increasing interdependence, the LLDCs  are themselves are becoming important transit states for others. Thus, for example, Mongolia provides one of the shortest land transit routes between Europe and East Asia, or the shortest gas pipeline  route between East Siberia of Russia and Northeast China. Therefore the cooperation within the Global Framework would benefit the traditional transit states as well as the industrialized and developed countries.

Mr. Chairman,

In order to allow others to make their contributions and encourage wider exchange of views, I would be brief and would like to draw your attention to the following five points.

One.  Importance of infrastructure development. It is clear  that the primary responsibility for alleviating the existing situation lies with the LLDCs themselves and, according to the reports presented to this meeting, enormous efforts are being made and resources spent, in this regard by the LLDCs.  However, it is also evident that these countries are not a position to address infrastructure development issues entirely on their own because they are costly, require huge investments and technology.  That is why the LLDCs attach great importance to cooperation with their transit neighbors and the donor community.   The forthcoming meeting on Financing for Development could be of special importance of LLDCs.  In the draft report prepared by the Ad Hoc Open-Ended Working Group, the scope of the meeting covers the question of special needs of LLDCs besides those of the African continent, the LDCs and SIDS. As one of the coordinators of the Group of LLDCs on this issue, we call for active and fruitful participation and input of all countries, especially of the LLDCs, as well as the relevant international organizations.

Two. It is well known that however serious are the transportation infrastructure problems, of no less importance is free, expeditious and unburdened flow of transit traffic. Therefore, the land-locked and transit countries have to exert special efforts to the removal of all non-physical  barriers, eliminating unjustified taxes and prohibitively high fees for transit freights, reducing the limited choices of transit transportation, simplifying and expediting customs procedures, ensuring  the safety of traffic, etc.

Three.  Northeast Asian regional development. As it is rightly pointed out in the UNCTAD report, of all the world’s regions and subregions, Northeast Asia is the least organized for addressing the subregion’s transit transport issues and there is still no subregional intergovernmental arrangement or agreement on transit trade. In this sense, the First Subregional Consultative Meeting of Land-locked and Transit Countries on transit transport cooperation held in 1997 and adoption by the meeting of Ulaanbaatar Memorandum of Understanding was a promising first step.  A draft subregional agreement on transit transport, elaborated with the participation of UNCTAD as a follow-up to that meeting, is expected to be considered at the experts’ meeting in early November of this year. It is expected that once the agreement is concluded, its parties would not be limited to Russia, China and Mongolia, but also other present and future users of this little known corridor would become parties and enjoy the benefits of this shortest land route from Rotterdam to East  Asia.

However, Mr. Chairman, in order to achieve that, as pointed out in one of the case studies, a number of difficulties and challenges need to be addressed and overcome. These are: underdeveloped transportation infrastructure, high transit transportation costs, problems related to the unjustified high fees and charges, limited choice of transit transport organizations, excessive restrictions, formalities and other non-physical barriers. Overcoming the constraints and difficulties of land-lockedness is a high priority goal of the Government of Mongolia. It has been taking a number of concrete measures in this regard with the assistance of the donor community. Taking this opportunity, I would like to express our sincere gratitude to the Government of Japan and governments of all other donor countries as well as to international organizations for their assistance in addressing these problems.

Four.    The agreements and other relevant documents of WTO accept that developing countries, especially the least developed countries  (LDCs), could receive special treatment. Unlike the LDCs, the LLDCs cannot graduate from their geographical category. Bearing in mind the very raison d’etre of the WTO, we believe that the specific needs of the LLDCs should be addressed by the WTO, since representing 5.1 per cent of the developing world, the LLDCs account for only 1.2 per cent of trade. It is difficult to talk about promoting trade flow as freely as possible, one of the three major objectives of the WTO, if, for example, in Mongolia’s case, 13.8 per cent of its total exports earnings go for transportation and insurance payments  which, according to UNCTAD, amounts to 6.8 of its total GDP.   Therefore my delegation would propose that  UNCTAD undertake a study, perhaps together with WTO, on how the handicaps and difficulties of the LLDCs could be addressed at WTO and report to our next meeting together with its concrete proposals.

Five.   Importance of international cooperation cannot be over-emphasized. International cooperation is vital in reducing or overcoming  the enormous problems and handicaps that the LLDCs are facing today. UNCTAD is called upon to play an important role, since it is the only organization in the entire UN system where the questions of LLDCs are addressed. However, as the chairman of the group of LLDCs has pointed out earlier, the  Office of the Special Coordinator is under-financed and under-staffed. The sole unit that is to deal with the problems of 29 LLDCs  does not have even a single post responsible for these issues.  We believe that the questions of adequate financing and staffing of the Office of the Special Coordinator should seriously be addressed at the forthcoming session of the General Assembly.

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See Table 4 of  “Selected Transport and Trade Data: Landlocked Developing Countries” prepared by the UNCTAD Secretariat.  Doc. UNCTAD/LDC/104 of 15 June, 1999

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