UN calls for curbs on currency speculators

Poverty reduction and wealth creation – the dreams of millions of people throughout the developing world – could be about to be dashed unless the powers of current economic forces are harnessed, a report by a United Nations (UN) agency warns.

Commodity exports have boosted economic growth in many countries

In recent years, economic growth has been exceptionally strong in many of the world’s poorest nations.

In the developing world, gross domestic product per head grew almost 30% between 2003 and 2007, the report notes.

However, the harsh truth is that it has come about, not because of clever economic management, but as a result of rapidly rising commodity prices.

Now, insists Heiner Flassbeck, author of the Trade and Development Report 2007, it is time for poor countries to invest the proceeds from the sale of commodities – such as oil, copper or sugar – to enable other sectors of the economy to grow.

“The window of opportunity, the windfalls, are still remarkable, and this should be used to diversify their economies,” says Mr Flassbeck.

Developing nations – and indeed the world at large – must “develop ideas and patterns of successful diversification” to reduce their reliance on commodity exports, he says.