THE IMPORTANT point about the United Nations Conference on Trade and Development, held in Geneva earlier this year, is not what has emerged from it but that it took place at all. The holding of the conference marks a new and fuller understanding, on the part of developed and developing countries alike, of the crucial relationship between trade and the development process. The central issues have been clarified by the conference. There has been a full and frank exchange of views on the ways and means of solving the problems which have been identified.
The conference readily accepted that those industries which are based on primary agricultural commodities - food and agricultural raw materials, including forest products - have a special importance for the developing countries. It is natural that a country which traditionally exports agricultural or forestry raw materials seeks to increase their value by undertaking processing before export. It is an anomaly that the flow of unprocessed raw materials from the developing to the developed world (a flow which includes many materials of which the developing world has a monopoly) is still heavily outweighed by the reverse flow of industrial products - processed, in many cases, from those same raw materials. Although in recent years the developing world's deficit on this account has diminished, it still remains considerable. What is disturbing is the feet that the total of the reverse flow has remained unchanged. In other words, although the developing world has managed to expand its processing industries and exports of processed goods, it has made no progress in reducing the flow of such processed goods that it takes from the developed world. This is a matter of serious concern, for what is at stake is much more than the continuing outflow of foreign exchange. What is lost is the increasing repercussion on the developing economy as a whole resulting from the establishment of such processing industries. The transformation of agriculture, a necessary concomitant to industrialization in the development process, is slowed down; and the foreign exchange drain is much greater than the direct import figures indicate, since the opportunity for establishing secondary, tertiary and related industries is precluded.
In one sector, that of forest products, however, the prospects for expanding exports seem especially promising: to a certain extent by 1970, but to an even greater degree in the longer term. The Deputy Director of FAO's Forestry and Forest Products Division, Jack C. Westoby, addressing a committee of the conference, dealt with the considerations underlying these prospects. One is the dynamic characteristic of demand for these products: sawnwood and wood-based panels for housing, other construction, furniture, etc.; newsprint, printing and writing paper for education, information, mass media, commerce; paper and board for packaging and a wide variety of industrial uses. Another is that, in several areas of the developed world, the local resources available to meet rising requirements are becoming strained. Thus the reappraisal of European timber trends and prospects to 1975 which we have recently concluded with the Economic Commission for Europe shows that, however great the effort which European governments, forest services and forest industries may make in the decades to come, Europe will have to look to other regions of the world to satisfy a growing proportion of its rising requirements. Part will certainly come from the developing world. How big their share will be depends partly on the extent to which the developed countries are prepared to favor imports from the developing countries, but mainly on the extent to which the developing countries are prepared consciously to plan the development of their forests and forest industries to take advantage of these growing markets.
"But Europe is not the only potential market. There are important possibilities also in Japan, North America and other industrialized countries. By 1975 it should be possible to raise the annual value of forest exports from the developing countries to the advanced countries by approximately U.S. $1,000 million, assuming that a substantial proportion of the new trade is processed in the country of origin."
Photo: D. A. Francis
