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ECOSOC 2010 General Segment ECOSOC 2010 General Segment 20 July 201020 July 2010

Panel discussion:Panel discussion:Opportunities for Small Island Developing StatesOpportunities for Small Island Developing States

Pierre EncontrePierre Encontre

UNCTADUNCTAD

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InternationalInternationalservicesservices

Vulnerability, resilience-building, specialization, servicesVulnerability, resilience-building, specialization, services

Progressin

resilience-building

EnhancingEnhancingspecializationspecialization

StocktakingStocktaking

Progress madeProgress madein addressingin addressingvulnerabilitiesvulnerabilities

of SIDSof SIDS

SIDSSIDSdenominationdenomination

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Antigua and BarbudaMain exports of goods and services, 2008

$ m

0

250

500

Tourism Transport Offshore Insurance

4

BahamasMain exports of goods and services, 2008

$ m

0

500

1000

1500

2000

2500

Tourism Offshoreserv.

Manuf.prod.

Organ.chem.

Sea prod. Transport Aragonite

5

BarbadosMain exports of goods and services, 2008

$ m

0

500

1000

Tourism Fin. serv. Offsh.serv.

Manuf.prod.

Rum Comm.serv.

Transp. Rawsugar

6

Cape VerdeMain exports of goods and services, 2008

$ m

0

100

200

300

400

500

Tourism Transport Comm.serv.

Fresh fish Fin. serv. Clothing Footwear

7

DominicaMain exports of goods and services, 2008

$ m

0

50

100

Tourism Offsh. serv. Manuf. prod. Bananas Transp. Raw mater.

8

FijiMain exports of goods and services, 2008

$ m

0

500

1000

Tourism Transp. Sugar Fish Mineralwater

Clothing Lumber

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GrenadaMain exports of goods and services, 2008

$ m

0

100

200

Tourism Offshoreservices

Transp. Fish Nutmeg

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JamaicaMain exports of goods and services, 2008

$ m

0

1000

2000

Tourism Alumina Transp. Comm.serv.

Rawsugar

Beverages Fruits &veg.

Fin.serv.

11

MaldivesMain exports of goods and services, 2008

$ m

0

500

1000

Tourism Fish Air transp. Freight services

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MauritiusMain exports of goods and services, 2008

$ m

0

1000

2000

Tourism Apparel Offsh. services

Transp.serv.

Rawsugar

Comm.serv.

Fin. serv.

13

Papua New GuineaMain exports of goods and services, 2008

$ m

0

1000

2000

Gold Copper Crude oil

Palmoil

Busin. services

Coffee Logs Cocoa

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St. Kitts and NevisMain exports of goods and services, 2008

$ m

0

100

200

Tourism Offsh. serv. Transp. services Beverages

15

St. LuciaMain exports of goods and services, 2008

$ m

0

100

200

300

400

500

Tourism Bananas Beer Busin.serv.

Transp.serv.

Manuf. prod.

Insur. serv.

16

St. Vincent and the GrenadinesMain exports of goods and services, 2008

$ m

0

50

100

Tourism Offsh.Services

Transp. serv.

Bananas Flour Rice Root crops

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SamoaMain exports of goods and services, 2008

$ m

0

100

200

Tourism Offsh.Services

Fresh fish Transport Other foodprod.

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Sao Tome & PrincipeMain exports of goods and services, 2008

$ m

0

5

10

Cocoa beans Tourism Coconuts Coffee

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SeychellesMain exports of goods and services, 2008

$ m

0

100

200

300

400

500

Tourism Canned tuna Transportservices

Comm.services

Offshoreservices

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Solomon IslandsMain exports of goods and services, 2008

$ m

0

50

100

Logs Busin.serv.

Transp.serv.

Palmoil

Frozenfish

Cocoabeans

Copra Sawnwood

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TongaMain exports of goods and services, 2008

$ m

0

5

10

15

20

Tourism Fin.serv.

Transp.serv.

Fish Squash Rootcrops

Kava

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Trinidad and TobagoMain exports of goods and services, 2008

$ m

0

1000

2000

3000

4000

5000

Naturalgas

Crudepetr.

Ammonia Methanol Tourism Transp.serv.

Insur.serv.

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VanuatuMain exports of goods and services, 2008

$ m

0

50

100

150

200

Tourism Transp.serv.

Fin. &offsh.serv.

Copra Coconutoil

Kava Beef

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1. Services dominate economic specialization of most SIDS (22 out of 29)2. Two sectors dominate the international service economy of SIDS: tourism, offshore3. What matters to most SIDS policy makers:

* make existing international service sectors competitive, sustainable, beneficial to all* develop two viable export service pillars, besides one or two competitive merchandise export sectors ("optimum specialization" overall)

4. Sound tourism development: sine qua non for structural progress (UNCTAD axiom)Tourism development = catalyst for infrastructure and human resource development, spur to efficient air transport, with backward linkages as an avenue for poverty reduction

5. Sound offshore specialization: powerful engine for reversing the brain drain* 12 of the 16 developing countries that are offshore centres are SIDS* 3 key lessons: awareness of (negative) global mood and willingness to comply; sound choice of offshore product specialization; widening notion of offshore service (growing range of outsourced services). UNCTAD assisting Cape Verde.

6. In short: services = wealth of opportunities, but SIDS need to manage the "island paradox"

Services: salient points, lessonsServices: salient points, lessons

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The "island paradox"The "island paradox"

Highest vulnerabilityHighest vulnerabilityin the world (EVI)in the world (EVI)

Apparent prosperityApparent prosperity

LimitationsLimitations

SpecializationSpecializationin servicesin services

IPIP

• Resilience-building is costlyResilience-building is costly

• Concessionary treatmentConcessionary treatmentis no luxuryis no luxury

• Lesser (or denial of)Lesser (or denial of)concessionary treatmentconcessionary treatment

• Premature graduationPremature graduationfrom LDC statusfrom LDC status

OverestimationOverestimation

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Is the UN’s SIDS denomination useful ?Is the UN’s SIDS denomination useful ?

Need forNeed forpreferentialpreferentialtreatmenttreatment

Need forNeed fortechnicaltechnicalassistanceassistance

Need forNeed forconcessionaryconcessionary

financingfinancing

S&DT in the WTO:S&DT in the WTO:for LDCs onlyfor LDCs only

(“SVE” has not(“SVE” has notborne fruit)borne fruit)

No technical assistanceNo technical assistanceprogramme reservedprogramme reserved

for SIDSfor SIDS

SIDS status weighsSIDS status weighslittle in donors’little in donors’

decisionsdecisions

Commendable move by ECOSOC in 2009 (E/2009/17)Commendable move by ECOSOC in 2009 (E/2009/17)

WHATWHAT

TOTO

DO ?DO ?

ALLOW UN’SALLOW UN’S

SIDS WORKSIDS WORK

TO EVOLVETO EVOLVE

FROM A FROM A

NEBULOUS NEBULOUS

CONCEPTCONCEPT

TO ATO A

CREDIBLE CREDIBLE

DENOMINATIONDENOMINATION

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E/2009/17E/2009/17

ECOSOC noted that the UN’s SIDS designation ECOSOC noted that the UN’s SIDS designation is “is “a useful and important tool for recognizing a useful and important tool for recognizing

and responding to the particular vulnerabilities and responding to the particular vulnerabilities and characteristics of SIDS and for assisting and characteristics of SIDS and for assisting

them in their pursuit of sustainable them in their pursuit of sustainable developmentdevelopment”.”.

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Thank youP. Encontre

Chief, Special Programmes

Division for Africa, Least Developed Countries

and Special Programmes

UNCTAD

pierre.encontre@unctad.org