Conflict Between North and South

Perhaps both sides had expected too much.

The world's less developed countries, known as the South, have long felt they have a right to share in the wealth of richer nations. They justify this by pointing to past colonial exploitation, etc. The industrialized countries of the so-called North hardly accept that version of history or justice. But they have moved a long way toward agreeing that something must be done to help the Third World.

During a four-day Conference on International Economic Cooperation held in Paris last week by 16 industrialized nations and 19 "poor" ones (which included some nouveau riche oil-producing countries), the North made what it considered a generous offer, especially given its painfully slow economic recovery. The South grudgingly accepted the package, but termed it quite inadequate and refused to give anything in exchange. Said Claude Cheysson, the European Community's commissioner for development: "We were within a hair of a breakdown. If we had known what a risk we were taking, we might never have started this dialogue."

Modicum of Progress. During the final 36 hours of the meeting, haggard and dispirited delegates shuffled from conference room to conference room seeking some small patch of common ground upon which a final communique could be based. The resulting document, while it conceded a modicum of progress, expressed the South's "regret" that "certain proposals for urgent actions had not been agreed upon."

The Northern offer had been worked out at the London summit in May and was partly an outcome of Jimmy Carter's promise to "reduce the chasm between the world's rich and poor." An important ingredient had been an increased willingness to help on the part of West Germany. The offer included a $1 billion special fund to help the poorest nations meet their bills for oil, other imports and interest, as well as an agreement to set up a common fund that would stabilize prices of certain commodities--a proposal intended to protect the Third World from disruptive price fluctuations.

In addition, the Northern countries pledged to step up assistance for the development of Third World agriculture, and to increase the financial resources of the International Monetary Fund and the World Bank in order to help poor countries meet their huge balance of payments deficits. A "decade of Africa" was designated, in which a substantial effort will be made to develop African economies, especially in transportation and communications.

In return for such pledges, the North asked for guaranteed access to stable supplies of oil and other raw materials, protection against arbitrary nationalization of foreign investments, as well as a forum for the continuing discussion of global energy problems, including oil.

No way, said the Southern nations. They repeated some of their wildly unrealistic demands, made at the start of the North-South dialogue 18 months ago, involving a "new international economic order" that would bring about a fundamental, massive transfer of wealth from North to South. The developing nations also demanded debt relief on the $180 billion they owe to industrial nations and an indexing of oil and commodity prices.

The delegates from the OPEC nations, including Iran's tough Oil Minister, Jamshid Amouzegar, rejected even the modest proposal for continuing energy discussions, which OPEC fears would reduce its power to control oil prices and supplies unilaterally. At the same time, the Southern nations refused to offer safeguards against nationalization of the North's investments. New York's Republican Senator Jacob Javits, who was in a group of congressional observers at the conference, chided the Southern nations for their rigidity and urged them to think in terms not only of government aid but also of investment, business and trade.

Collision Course. One of the few favorable signs at the conference was that the Southern polemics were somewhat more restrained than usual. Said Venezuela's Minister of State, Manuel Perez Guerreo: "You can't get a new international economic order in 18 months." How serious the conflict between the two groups really was may become clearer in July when OPEC leaders, still divided among themselves, meet in Stockholm for a review of oil prices that could once again put North and South on a collision course.

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