A Reformed ECOSOC for a Stronger UN

The recent series of international financial crises, and the alarming increases in inequality between rich and poor countries, are due largely to serious weaknesses in the international structures and processes for cooperation on economic policy. These weaknesses cause severe personal hardship, often with fatal consequences, for very many people, especially in developing countries. They also harm many business enterprises which want to compete on fair terms and many governments which want to advance the interests of their citizens.

     The United Nations has a clear mandate and responsibility to play a major role in international economic cooperation, especially through its Economic and Social Council system. Yet from its earliest years ECOSOC has largely failed to do so. Instead, the major roles have been played by organizations such as the IMF, World Bank, G7 and OECD which are dominated by the wealthiest countries and usually give insufficient attention to social development and environmental sustainability. The WTO has behaved in a similar way, although developments at its 1999 Seattle meeting suggest that some improvements may be achievable where developing countries have majority voting power, organize themselves effectively and enjoy strong civil society support.

     The Seattle confrontations were seen widely as a powerful challenge to the WTO. But they also presented a challenge - and opportunity - for the United Nations. A central debate was whether the WTO, ILO or some combination of the two should be responsible for resolving possible conflicts between trade rules and labour standards. Concerns were also expressed about how environmental considerations would be taken into account. Of course, many other issues such as health, education and poverty reduction can also be crucially affected by trade rules.

Managing the global economy in the interests of all:
a renewed ECOSOC

     The mechanisms for resolving such conflicts should not be determined by ad hoc responses to particular political forces at particular moments in time. Instead, they should be part of an ongoing and coherent framework which is established and overseen by an organization that recognizes the full range of relevant issues and interests. At the national level, this is the role of the head of government, cabinet, or other whole-of-government authority. At the global level, ECOSOC’s mandate, composition and location within the UN system make it the most appropriate body for the task. It is ECOSOC which should have overarching responsibility for determining the mechanisms by which particular conflicts in international rules and standards between, say, trade, labour and environmental agencies should be resolved.

     But ECOSOC’s responsibilities go beyond even that important role. It needs to be come more closely and centrally involved, for example, in international discussion and decisions concerning key issues such as financial market regulation, tax policy and administration, and corporate regulation. Policies and practices in these areas have suffered severely from the dominance of narrow economic perspectives, and of the wealthiest countries, in key organizations such as the IMF, OECD and Bank of International Settlements.

     In principle, ECOSOC should be less prone to these weaknesses. Most of its members are from developing countries and its mandate covers a very wide range of both economic and social issues. In practice, however, these potential strengths have been major causes of its ineffectiveness. The wealthiest countries have not wished to submit to an organization such as ECOSOC which they do not control (indeed, on which none has a guaranteed position). The breadth of ECOSOC’s responsibilities has contributed to its lack of focus, expertise and momentum on major issues. Other causes include the sheer size of ECOSOC, which now has 54 members and allows all other UN members to attend its meetings, its preoccupation with routine reports rather than less formal discussion of major policy issues, and the infrequency of its meetings.

Priorities for ECOSOC Reform

     Two important structural reforms in ECOSOC could substantially reduce these problems. First, ECOSOC membership could be halved to about 25 countries, which would make it about the same size as is widely agreed to be appropriate for the Security Council. Second, the wealthiest countries (say, the Group of 8) and a similar number of the most populous countries (say, China, India, Brazil, Indonesia, Nigeria etc.) could be made standing members, with the remaining members being elected for fixed terms on a regional basis. It should be noted, incidentally, that five of the G8 members have been ECOSOC members throughout the last 20 years and each of the other three have been ECOSOC members for 16 or more of those years. Amongst developing countries, only Brazil, China and India can match these levels of continuity.

     Two key procedural reforms could also greatly improve ECOSOC’s effectiveness. First, ECOSOC could meet on a regular quarterly basis, abbreviate its very lengthy annual meeting, and focus more heavily on informal policy discussion rather than ritualized consideration of reports from its constituent organizations. Second, it could make greater use of fixed-term Ministerial Working Groups and independent Expert Advisory Panels to discuss and report on specific major policy issues.

     It is essential, too, that ECOSOC strengthens its interaction with some intergovernmental organizations which like the WTO, are not within the UN system, or which, like the World Bank and the IMF, while formally UN specialized agencies do not submit to its supervision. A little progress has been made recently in relation to the World Bank, IMF and WTO but it remains very limited and precarious. One or more Ministerial Working Groups and independent Expert Advisory Panels could be established to strengthen the quality and impact of ECOSOC’s engagement with these bodies.

     Much closer engagement with key regional groupings such as the European Union, Mercosur, Southern Africa Development Community and Association of South East Asian Nations is also essential. These non-UN groupings are much more significant to government leaders, and more reflective of appropriate regional boundaries, than most of ECOSOC’s unwieldy regional commissions. ECOSOC’s profile and impact around the world could be strengthened substantially by convening an Annual Regional Consultation involving not only its own regional commissions but also the non-UN groupings. It might also be desirable if the new regional groupings became the basis for election of regional representatives on ECOSOC itself and for constitution of negotiating groups in its processes.

The Way Ahead

     The proposed changes in ECOSOC’s composition are clearly contentious and would require a change in the UN Charter. Unless they are made, however, it is difficult to see much prospect of the United Nations substantially strengthening its influence on international economic policy-making. The principal victims of that outcome would be the developing countries, except perhaps the most populous of those countries which may achieve membership in key non-UN bodies (as has occurred recently, for example, with the Group of 20 which was established to promote international financial stability). Developing countries have much to gain if ECOSOC is restructured to improve its influence while also strengthening the effectiveness of their representation, rather than leaving them so much at the mercy of bodies such as the IMF and G7 on which they have little or no voice.

     The proposed changes to the UN Charter would have been a highly appropriate outcome of the Millennium Assembly. Unfortunately, the opportunity was wasted. But even without formal changes, useful progress could be made by establishing an ECOSOC Working Group on Economic Cooperation which reflected the composition proposed above for ECOSOC itself. This group could be principally responsible for developing close, high-level interaction with other bodies such as the Bretton Woods institutions and key regional groupings. The procedural changes which have been suggested above could be made without changing the UN Charter and, perhaps, without great controversy. They could be adopted at the next annual ECOSOC meeting in July 2001.

     Recent manifestations of inadequacy by bodies such as the IMF and WTO have given the UN its best opportunity for several decades, perhaps ever, to play the major role in international economic policy-making which it was intended to play. The fulfillment of that role by the UN is essential for the achievement of sustainable and equitable development around the world. But the opportunity will be lost, and may not recur, unless major reforms of the ECOSOC system are made without substantial delay.