United Nations and Economic Development

United Nations and Economic Development

Functions of the UN: Economic and Social Development Economic Development

Introduction to United Nations and Economic Development

The UN operates under the principle that promoting economic and social development will help bring about lasting world peace. The organization’s charter calls on the UN to promote full employment for all, higher standards of living, and economic and social progress. As a result, the UN devotes a major proportion of its staff and budget to economic development programs worldwide. The General Assembly has recognized the need to restructure international economic relations to help developing countries and has recommended a series of steps aimed at reducing the gap between wealthy and poor countries.

The UN operates many programs and special agencies to promote economic development and provide assistance and technical expertise to developing countries. One of those programs is the United Nations Conference on Trade and Development (UNCTAD). Many developing nations rely on income from trade to support their economic development efforts at home and are especially vulnerable to price fluctuations on international markets and other trade problems. UNCTAD was founded in the 1960s to help negotiate international trade agreements that stabilize prices and promote trade with developing countries. During the 1970s the General Assembly included those goals in its call for a New International Economic Order to promote growth in developing countries. But developing countries have little power in the international economy, and as a result UNCTAD has been largely ineffective in advancing their interests in international trade.

Other efforts include the United Nations Development Program (UNDP), which coordinates all UN efforts in developing nations. It is funded through voluntary contributions and has thousands of projects operating around the world. UNDP is the world’s largest international agency providing development assistance on technical issues. Two related agencies are the United Nations Industrial Development Organization and the United Nations Institute for Training and Research.

UN programs offer several advantages in promoting economic development. Governments of developing nations see the UN as a friend of the developing world, not as an outsider threatening their authority or as a reminder of colonial rule. Many UN experts and volunteers are themselves from other developing countries. UN workers who come from the developing world may be more sensitive to local conditions and to the pitfalls of development assistance than their counterparts from more wealthy countries. The UN can also organize its assistance on an international scale, avoiding duplication of efforts. Some issues, such as prevention and treatment of major diseases and environmental protection, particularly benefit from the UN’s international approach.

A major disadvantage of the UN development programs is that their funding largely depends on voluntary contributions from wealthy nations. Each program has to solicit contributions to carry on its activities, and contributions can be abruptly cut off if the program displeases a donor government. In addition, programs sometimes lack the efficiency and resources that governments and businesses in wealthy countries take for granted. This has given the programs a reputation for being inefficient and bureaucratic.

The UN also helps finance development through the International Bank for Reconstruction and Development, better known as the World Bank. The World Bank was created in 1944 to help developing nations get funding for projects. The bank grants loans to member countries to finance specific projects and this in turn encourages foreign investing. A related agency, the International Monetary Fund (IMF), was created at the same time to promote international cooperation on monetary issues. It encourages a stable, orderly pattern of monetary exchange rates between nations.” (1)

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Guide to United Nations and Economic Development


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