• by IPS Correspondents (dresden, germany)
• Saturday, November 19, 1994
• Inter Press Service

DRESDEN, Germany, Nov 19 (IPS) - Trade liberalisation and excessive exports can precipitate environmental degradation in the South when appropriate policies are not in place, according to an official of the International Monetary Fund (IMF).

However, the solution does not lie in putting restrictions on trade but the accelerated introduction of well-defined property rights in the South, IMF's assistant director Peter B. Clark told IPS. He also cautioned against considering economic growth as an obstacle to clean environment.

The IMF official pointed out that property rights to natural resources were not well defined in the South. Subsequently, the price of goods using these resources intensively was lower than in the industrialised countries where those rights were well defined in a legal code of private property.

"This institutional difference leads to the flow of exports from the South to the North based on a perceived comparative advantage in the South which reflects a market failure," argued Clark.

The introduction of property rights would result in an appropriately higher price for the South's natural resources and therefore in a higher price of their exports to the North, he added.

Clark was in Dresden, some 180 kms from Berlin, to join a three- day international symposium which ended on Nov 13. It was organised by the Development and Peace Foundation (SEF).

The Bonn-based Foundation was set up in 1986 by late Willy Brandt, a former West German Chancellor and Chairman of the 'Brandt Commission', which published two reports in the early 1980s examining manifold aspects of North-South relations.

Clark was the only representative of the Bretton Woods institutions, attending the SEF conference devoted to 'Structural Adjustment in the North -- Strategies for a Sustainable World Economy' in which 50 experts from industrialised and developing countries participated.

According to Clark, who heads the economic modeling and external adjustment division in the IMF's research department, sustainable economic growth is an essential precondition for environmental protection. Sustainable growth is the one that meets the needs of the present without compromising the ability of future generations to meet their own needs.

© Inter Press Service (2014) — All Rights Reserved. Original source: Inter Press Service

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