Well, Here We All Are...

By James Kelly

Reagan graces a North-South summit but gives only a little

AlI in all, I think they have seen fine meetings and I think great progress has been made." So said Ronald Reagan last week about the summit in Cancun, Mexico, where he met leaders from seven other industrialized nations and 14 developing nations. Billed as the first dialogue between the mostly rich Northern Hemisphere and the mostly poor South, the conference was intended to seek ways in which the haves could help the have-nots climb out of poverty. Yet the meeting broke up with no real achievements, and little consensus other than that the U.S. cannot be pushed where it does not wish to go. The best that could be said about Cancun is that the leaders agreed to continue talking, but neither a forum nor a time was set. As Canadian Prime Minister Pierre Trudeau, co-chairman of the conference with Mexican President Jose Lopez Portillo, candidly admitted, "We failed to get agreement on what the next step should be."

So why was Reagan pleased? Mainly because a potentially acrimonious confrontation had ended in a benign stalemate. From the start, most of the participants knew that the President strongly disagreed with them on how the central issues should be resolved. As a visitor who came to Cancun bearing good will but no concessions, Reagan, or at least his advisers, fully expected some nasty condemnations by the more outspoken of the Third World leaders present. But few hisses were heard. Not only were the formal sessions remarkably free of rancor, but the summit gave Reagan a chance to hold surprisingly friendly chats with many of the leaders. "None of them were hostile," said one top White House aide. "They appreciated that Reagan was willing to come down to discuss these questions."

One by one, the leaders flew into Cancun airport, each one arriving about half an hour apart so Lopez Portillo could welcome them individually. Heat hung over the airport like a suffocating cloud; the temperature on the tarmac approached 100DEG. Dressed in long-sleeved uniforms with helmets and combat boots, several hundred presidential guardsmen stood on the steaming runway all day to greet the dignitaries. One young private, spying a reporter with an arrival schedule, pleaded, "When is the last one, please?" When Air Force One landed, Reagan greeted Lopez Portillo with a warm abrazo. The pair stood at attention as each one's national anthem was played and howitzers blasted an ear-splitting salute.

Considering the summit's theme of world poverty and hunger, the setting for the conference was a trifle incongruous. Cancun is a lush, 14-mile-long island resort near the Yucatan Peninsula, studded with gleaming hotels and condominiums. Delegation leaders were assigned identical two-room suites, complete with terrace and Jacuzzi, in the pyramid-shaped Sheraton Hotel, hard by the Caribbean. On the day before the conference began, Philippines President Ferdinand Marcos went waterskiing, while Reagan and his aides lolled away half an hour on the beach.

The two days of formal sessions were held in a conference room inside the lobby of the Sheraton. Each delegation leader, along with an aide, sat around a 110-ft. doughnut-shaped table, built at a cost of $250,000; the center was filled with thousands of flowers. To Reagan's right was Secretary of State Alexander Haig. The dress code was informal, defined according to national taste. The Saudis were in traditional robes, and the Nigerians appeared resplendent in tribal dress. India's Prime Minister Indira Gandhi wore a flowing ivory sari to the first session. The President sported a burgundy short-sleeved shirt and brown slacks. Reagan may have been a bit too informal: he showed up 13 min. late for the first plenary session, leaving the other leaders to fidget in their seats and greatly annoying Lopez Portillo, a stickler for punctuality.

For Third World leaders, a key issue facing the participants was where and how to hold "global negotiations," a code phrase for wide-ranging bargaining through which the poor nations hope to reshape the world economic system and wrest a bigger slice of the wealth from the industrialized nations. The gap between rich and poor nations, always wide, has yawned bigger over the past decade. The industrialized nations, for example, have only one-fourth of the world's population, but control 79% of the world's income. The poor nations want future global negotiations to take place in the United Nations General Assembly, where the one-country, one-vote rule gives them an overwhelming advantage. But Washington prefers that major decisions on economic aid remain with such agencies as the World Bank and the International Monetary Fund, which are dominated by the U.S. and other industrialized nations.

This sticky problem was addressed head-on in the first formal session, when each leader was given ten minutes to deliver an opening speech. Reagan's tone was conciliatory, but not his substance. He renewed a pledge, made last July at the Ottawa summit of the leaders of the seven major industrialized countries, that the U.S. would be willing to explore the possibility of engaging in some kind of colloquy between rich nations and poor nations. Reagan, however, also set forth conditions that would substantially limit the scope of any global negotiations. He called for an agenda that would address such issues as trade and agriculture, but would omit any attempt to create a new system for sharing the world's wealth. He insisted that such agencies as the World Bank and the IMF continue to hold the purse strings on economic aid. Finally, he mentioned that foreign aid must hinge on the "domestic economic policies" of the donor nation (translation: expect no hikes in aid from the U.S.) and that talks should take place in a forum that encourages a "cooperative spirit" (translation: not in the U.N. General Assembly, where the U.S. is so often lambasted). Said one White House official: "The statement was carefully sculpted to say no in a cooperative way."

Some delegations initially thought that Reagan was really saying yes, or at least maybe. French Minister for Cooperation Jean-Pierre Cot, for example, lauded Reagan for endorsing global negotiations. "The spirit of Cancun has prevailed," said Cot. "It has performed miracles." But as it turned out, the participants remained deeply divided. The most radical position was staked out by Algerian President Bendjedid Chadli, who pressed for a "new international economic order." The West Germans and the British, on the other hand, basically backed Reagan in insisting that any negotiations take place outside the U.N. The most conciliatory notes were struck by French President Franc,ois Mitterrand and Trudeau. Surprisingly, Indira Gandhi, long a critic of the U.S., hewed to a moderate view, appealing for "cooperation rather than confrontation."

Reagan also rejected another proposal by Third World countries: the formation of a special "energy affiliate" to the World Bank to funnel credits to developing nations to meet their energy needs. The plan is supported by France, Canada and Mexico, among other nations. Said Reagan: "We should not seek to create new institutions." But Reagan was unexpectedly outflanked by Crown Prince Fahd of Saudi Arabia, who announced that his country was now willing to support the creation of an energy affiliate. Up until now, Riyadh had sidestepped the project, and Washington had justified its own rejection by citing Saudi objections.

On other issues, Reagan barely budged. In a session on world hunger, the President offered to send task forces of American agricultural experts to any nation requesting them. Typically, Reagan delivered up a favorite anecdote to drive home his point. "If a man is hungry and you give him a fish, he will eat it and will be hungry tomorrow," said Reagan. "But if he is taught to fish, he will never be hungry again." Lopez Portillo quickly riposted: "Those who are really hungry in this world are those who produce the food, the farmers, and that is the paradox. It is not only a lack of technological capability, but of financial capability."

On the question of trade, most of the delegates were in favor of broadening the scope of the General Agreement on Tariffs and Trade (GATT), the Geneva-based organization that regulates trade among the developed nations. Most of the summit participants urged GATT to start discussing trade in raw materials, with an eye toward stabilizing prices to benefit the Third World producers. Commodity agreements already exist in tin and sugar, and the Third World wants more raw materials covered. Many West European countries, notably France, support the move, but the U.S. remains vehemently opposed to international controls over trade and prices.

From Reagan's viewpoint, one of the most valuable aspects of the summit was the chance to hold bilateral meetings witha lobby of leaders. The President conferred with 14 delegation heads in meetings sandwiched around the formal sessions. In his call on Reagan, Nigerian President Alhaji Shehu Shagari, as expected, touched upon black Africa's concerns regarding Namibia and Angola. In her visit with the President, Indira Gandhi was calm and low-keyed while explaining India's worries about the proposed U.S. sale of F-16 fighter jets to Pakistan. She gently reminded Reagan that "we have enough budgetary problems, so I hope you don't make us spend more for arms." And, wonder of wonders, Reagan's advisers reported that the President did not bring up the much contested plan to sell AW ACS planes to Riyadh in his chat with Crown Prince Fahd of Saudi Arabia (see following story).

As the summit ended, the participants tried to put the best face on its ambiguous outcome. "Our purpose was to renew the dialogue between the North and the South," said Lopez Portillo. "This was done." Added Algeria's Ambassador to the U.N. Mohammed Bedjaoui: "We leave Cancun with great enthusiasm." Yet the results hardly rate those reviews, for the summit failed to reach an agreement on the two most important issues: global negotiations and a World Bank energy affiliate.

But perhaps that is not surprising.

Nothing could have been accomplished without the acquiescence of the most important industrialized nation, the U.S. As one European official of the Agency for International Development put it, "The Americans hold all the cards, and they know it." Under the circumstances, perhaps, Cancun might best be termed an educational experience.

"What happened here was all that was possible," said a veteran U.N. observer. "At a minimum, these people know each other better now." Yet for the leaders of the Third World nations present at the conference, the meaning of the word Cancun --"pot of gold" -- must have seemed supremely ironic.

--By James Kelly.

Reported by Laurence I. Barrett and James Willwerth/Cancun

With reporting by Laurence I. Barrett, James Willwerth

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