Rendezvous in Canc

By Thomas A. Sancton

To talk of matters North and South, rich and poor

Eyed coldly, it is a trip that hardly seems necessary. The two-day meeting has no formal agenda. There will be no final communique. Few of the participants expect much in the way of concrete results. Then why are 22 heads of government,* 1,000 ministers and aides and more than 2,500 journalists converging on the Mexican resort island of Cancun this week for the International Meeting on Cooperation and Development conference?

The answers are as varied as the political and economic stripes of the delegations.

For some of the more militant Third World leaders, the Cancun session will be another pulpit from which to bully the industrialized nations for their real and imagined imperialist sins. For others, it will be a chance to lobby face-to-face for change in a world economic order that is stacked against the poorer nations. For Ronald Reagan, it will be an occasion to hold up the U.S. example of free enterprise as the path to development and prosperity. It will also give him an opportunity to meet some important foreign leaders for the first time.

Among them: China's Premier Zhao Ziyang.

The main idea behind the summit, that the industrialized world must help the underdeveloped countries climb out of poverty, has been an article of Third World policy for decades. The immediate inspiration for Cancun came from a report published last year by an 18-member independent commission on international development headed by former West German Chancellor Willy Brandt. Among its proposals: major aid transfers to the Third World; reform of international lending agencies to provide cheaper credit to the Third World; stabilization of oil and commodity prices to benefit the developing countries. The Brandt report also urged that leaders of the industrialized North and the underdeveloped South gather to discuss their "mutuality of interest." Mexico and Austria took charge and began planning the Cancun conference more than a year ago.

The initial U.S. response to a North-South summit was cool. The Reagan Administration opposes the Third World's demand for "global negotiations" under U.N. auspices--an idea that will be strongly promoted at Cancun. Nor is the Administration, with its emphasis on economic retrenchment at home, enthusiastic about debating vast new outlays of foreign aid (now running at about $6 billion a year). The Reagan team, moreover, views foreign aid as an adjunct of its military and political policies, rewarding more on the basis of friendship than need.

Determined lobbying from Mexico's President Jose Lopez Portillo, British Prime Minister Margaret Thatcher and Canadian Prime Minister Pierre Trudeau helped persuade Reagan to attend Cancun. But he had conditions: Cuba's Fidel Castro must not attend, the meeting should not be held before the Ottawa summit, and there must be no fixed agenda.

Discussion will center on broad topics: food and agriculture, energy, raw materials, trade and development, financial policy. Each head of government will make a short speech, and there will also be informal conversations. Instead of issuing the usual communique, Host Lopez Portillo will sum up the sense of the meeting in his closing statement.

Even that vague format contains opportunities for sharp disagreement. Many of the developing countries' key demands clash with Reaganaut philosophy. Commodity prices, for example, are a major sticking point. With some justification, many Third World nations complain that the commodities they sell, such as coffee, tin and sugar, are underpriced, while the goods they buy from the industrialized nations come with ever higher price tags.

Yet the idea of artificial price stabilization is anathema to Washington. Says one U.S. diplomat: "If we've had any experience in economy, it shows you can't repeal the law of supply and demand."

In a speech to the Philadelphia World Affairs Council last week, Reagan gave a preview of his likely position in Cancun.

While he held out no hope for direct aid increases or global negotiations, the President pointed to the American experience as proof that "free people build free markets that ignite dynamic development for everyone." His formula for economic advancement includes expanded trade, regional cooperation, technological improvements in agriculture and energy, and promotion of private investment. The formula ignores the fact that many Third World countries follow socialist principles or lack the foundations for a free market economy.

Reagan's up-by-the-boot-straps advice will probably be seconded at Cancun by a fellow conservative, Margaret Thatcher. But Reagan is likely to be at odds with some of Washington's other industrialized allies.

French President Francois Mitterrand, who holds that aid to the Third World also helps the industrialized nations by creating growing demand for their products, will be pushing both for global negotiations under the auspices of the U.N.

and some sort of Third World energy program. His favorite energy proposal so far would rely partly on petro-money and would funnel credits to underdeveloped countries through a special "energy affiliate" of the World Bank. Mitterrand will do his best to sell Reagan on the idea, but the last thing France wants is a quarrel with Washington. Says a member of the French delegation: "We would like to avoid a confrontation with the U.S., which would not only be wasteful but quite contrary to what Cancun is all about.''

--By Thomas A. Sancton.

Reported by Laurence I. Barrett and James Willwerth/ Mexico City, with other bureaus

* Algeria, Austria, Bangladesh, Brazil, Canada, China, France, Guyana, India, Ivory Coast, Japan, Mexico, Nigeria, the Philippines, Saudi Arabia, Sweden, Tanzania, United Kingdom, U.S., Venezuela, West Germany, Yugoslavia.

With reporting by Laurence I. Barrett, James Willwerth

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