JOINT STATEMENT

I

The economic cooperation of the last 25 years has been the result of a gradual liberalisation of international exchanges, made possible by the acceptance of a number of rules of behaviour. However, the growing volume of trade and transaction, and the divergence of interests among both the advanced and newly emerging nations have made the international economic System more complex.

Solutions must now be found for serious balance-of-payment problems resulting from inflation and the recent rise in raw material prices. For the poorest part of humanity life itself is at stake and in some industrial countries the existing social and political system could be endangered. The international community must help those who are hit hardest to buy time so that they may adjust to new circumstances.

The events of the past year have shown the difficulty of working out joint solutions. The dramatic rise in commodity prices threatens to damage the international economic order. Inflation is causing severe strains within our nations and the machinery of international cooperation is in danger of being overtaken by events. This is leading to unilateral actions and to the feeling that interdependence is a burden instead of the source of our wellbeing. Unless interdependence becomes cooperation, there is a high risk of global anarchy.

II

In Brussels, on June 24/25, the Executive Committee has discussed current economic and political problems on the basis of the following reports:

• A turning point in North-South economic relations
• Energy: The imperative for a trilateral approach
• Directions for World trade in the Nineteen-Seventies

Our discussions strengthened our conviction that:

• interdependence has become a central and inescapable fact of relations among nations;
• cooperation among Japan, North America and Europe is indispensable in order to find solutions for the problems caused by interdependence;
• only if united can the nations of Europe play their full part in shaping a cooperative world order;
• confrontation between the advanced and the developing countries must be avoided and progress must be made towards an equitable world order, which takes full account of the problems of those nations lacking in material wealth.
• The vitality of the industrial societies is an indispensable condition for the solution of the problems of all countries.

III

Our discussions have resulted in the following conclusions and recommendations:

• First: there is an urgent need to help the nearly one billion people in some 30 resource-poor developing countries whose governments cannot pay the increased costs of oil, food, fertilizer and other products. The Executive Committee urges an extraordinary effort of international cooperation to provide the $ 3 billion in additional concessional aid that the World Bank estimates is needed for these countries in 1974-75. Without prejudice to burden-sharing arrangements for the longer term, we believe the responsibility of providing the $ 3 billion should be shared by the countries of the Trilateral region on the one hand and the oil-exporting countries on the other. Our proposal takes account of the fact that the Trilateral countries have a vastly greater total national income, while the oil-exporting countries have enjoyed a dramatic increase on their export earning and therefore in their capacity to invest abroad. We hope the Soviet Union will also participate in this $ 3 billion emergency program.
• Second: the oil payments place very uneven burden on different industrialised countries. Closer international monetary cooperation is necessary to ensure that these differencies do not lead to a serious crisis of the international trade and payments system. The Executive Committee has noted with satisfaction the decision of the IMF to establish a new lending facility to help developed nations to finance their increased oil imports. In order to obtain funds in addition to those 3. already pledged to the IMF for this purpose, the Fund should be authorised to borrow money in its own name. Recycling has taken place so far mainly through the leading private banks. But additional action will also be required to deal with the immediate problem. The Executive Committee urges the governments, central banks, international institutions and private banks to cooperate in innovative ways to avoid a collapse of the international trading and payments system.
• Third: these measures, indispensable in order to buy the time necessary for orderly structural changes must be accompanied by cooperative energy policies of the trilateral countries. Our countries should enhance their efforts in energy conservation and efficiency of energy use. Our countries should also diversify their energy supply sources. Long-term investments are required for developing new energy resources. Faced by insecure supply and high cost of energy in the coming decade, our countries should work out necessary measures to encourage such investment. In order to promote conservation, efficient use and increased supply of energy,the exchange, research and development of relevant technology throughout the world should be stepped up, especially in cooperation with the oil producing countries. Our governments should work together with a view to establish an emergency sharing scheme, to protect against the risk of supply interruptions. The Executive Committee urges our governments to pursue these efforts with the greatest diligence and to avoid time-consuming overlap between new and existing international machinery.
• Fourth: the Executive Committee is of the opinion that special efforts are needed to maintain, reinforce and adapt the present trading system, which constitutes one of the most impressive achievements in economic cooperation of the past 25 years. Therefore parallel with the efforts to establish a new monetary system, the GATT negotiations commenced last autumn in Tokyo, should be pursued with vigor. The developing countries must obtain better access to our markets. Export controls and non-tariff barriers, which have taken on greater importance, must be brought under the supervision of the international community. Agricultural trade must be reorganised to maximise efficiency of production, security of supply and insurance against sudden shortages. For these new problems, new rules must be established. The task is no longer merely to perfect the international market place — though much remains to be done in this field — but to deal jointly with the task of managing its operations.

The Executive Committee considers that these measures and efforts are indispensable in order to avoid a serious disruption of the world's economy. By taking them speedily our governments will safeguard the fruits of interdependence, and avoid the drift back into policies that may promise short-time advantages for some but will spell long-time diasterdisaster for all.

IV

Finally, in a longer time perspective the cooperative use of the ocean resources is of fundamental importance for the adaptation of the existing economic order to to-morrow's needs. The Executive Committee has therefore set up a task force to report on an efficient and equitable ocean regime. Moreover, since the central question for the future will be how to preserve and enhance our democratic systems and how to organise a more effective and cooperative international system the Executive Committee has authorized two longer-range projects: one on the future of Modern democracy and the other entitled "Towards a Renovated International System".