UNIDO The Turnaround, 1985-89

THE United Nations Industrial Development Organisation (UNIDO), Vienna, will be completing, by the end of 1989, its first four years operating as an autonomous specialised agency of the United Nations system. The third session of its general conference to he held from November 20 to 24 will mark the completion of the first term of office of its first director-general, Domingo L Siazon of the Philippines. The conference is expected to unanimously re-elect him to a second term of office, which he richly deserves for having brought about a turnaround in the fortunes of and prospects for UNIDO. The expectations raised by the new UNIDO versus realities of the international environment were analysed in this journal four years ago,1 The UN system was facing an unprecedented crisis of confidence in its bona fides as well as a financial crisis due to the disenchantment of the richer countries with multilateralism and default in payment of its assessed contribution by the most powerful country, the United States. UNIDO, till then a part of the United Nations secretariat, had itself been bogged down in north-south confrontationist issues of redeployment and redistribution of world industrial capacity, transfer of technology and flow of external financial resources, even though it had progressively developed a technical co-operation programme with the developing countries to an annual expenditure (on technical assistance) of almost $ 100 million by 1985. This author had commented as follows four yers ago in the afore-cited article: In the changed circumstances of today when the world economy is at a standstill if not stagnating, when the burden of debt of the developing countries and the lack of growth of developed countries have led to drying up of multilateral assistance, when it will be difficult to raise additional resources, it is a moot question whether the conversion of UNIDO will be to the long-run advantage of industrialisation of the developing countries.2 The results of the functioning of UNIDO during the last four years have belied these pessimistic expectations. The turnaround achieved has been due both to exogenous and to endogenous factors. The world economy has grown faster than in the first half of the eighties, despite continued stagnation in Africa and Latin America. Confidence in the United Nations system has markedly improved due to the political initiatives and successes of Perez de Cuellar, the secretary-general of the UN (Iran-Iraq, Afghanistan, Namibia, Angola, Western Sahara). While these factors have helped UNIDO, much of the credit for its turnaround is due to the realistic and pragmatic policies and initiatives of its director-general, Siazon. Before dwelling on these, one should analyse the extent and magnitude of the changes in UNIDO activities.