Address by the President of the Socialist Federal Republic of Yugoslavia1

International Monetary Fund. Secretary's Department
Published Date:
November 1979
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Josip Broz Tito

It is a great pleasure for me to greet you at the beginning of your Annual Meetings, and to extend to you a warm welcome to our country. It is a great honor for the Socialist Federal Republic of Yugoslavia, as a nonaligned and developing country, to host this distinguished gathering of the representatives of important institutions within the United Nations system which hold a significant and responsible place in international economic relations.

Your responsibility is particularly great in the present complex international situation, burdened by various threats to world peace.

Although there is today undoubtedly less danger of a worldwide conflict, peace and security have still not been ensured. Significant progress has not been achieved in democratizing international political and economic relations. The process of relaxation of international tension has not become universal. And the danger of new conflicts will not be removed until this process encompasses all the world’s regions and all countries and extends to all fields and problems of international relations.

The policy of fait accompli is still with us. Recourse is made to force and military intervention in order to ensure national interests. The rights of people to self-determination are denied and flagrantly violated, as are their rights to their own national political, economic, and cultural development. In spite of the resolute condemnation expressed by world public opinion, the remnants of colonialism and racist regimes still persist. The arms race continues unabated, having an adverse and direct impact not only on world peace and security but also on development, particularly that of the developing countries, which are compelled to earmark a significant part of their national income for defense purposes. We cannot remain untroubled in the face of all these facts.

Clearly, there can be no stable and just peace or universal progress without the solution of pressing economic problems affecting the vital interests of numerous countries. At present, inequitable international economic relations are, increasingly, becoming hotbeds for dangerous crises and conflicts. The world economy is in serious difficulty. The economies of highly developed and industrialized countries have been registering slower economic growth accompanied by an almost constant increase in unemployment and inflation, exceeding acceptable limits. Protectionist constraints in international trade, imbalances in external payments, and constant currency disturbances are assuming worrisome dimensions.

These unfavorable trends have particularly adverse effects on developing countries. Their position in the world economy and international economic relations continues to deteriorate. Protectionist measures introduced in recent years by developed countries mainly encompass imports of commodities in which developing countries have become competitive. Owing to the deteriorating terms of trade for developing countries, developed countries gained approximately $30 billion in 1978 alone. All this worsens the balance of payments situation for developing countries and increases their already extensive indebtedness.

A large number of developing countries are confronted with the danger that the results of their efforts in the past decade will be devalued and their further development brought to a standstill. Consequently, the recent Conference of Heads of State or Government of Nonaligned Countries, in Havana, focused attention on the issue of inequitable international economic relations. It was noted with concern that, in the course of the last two decades, the gap in the level of economic development between developed and developing countries has widened substantially and assumed alarming proportions. The latter’s share in world production is stagnating. The situation of the least developed among developing countries gives cause for anxiety, as they even have nothing to export. Actually, these countries cannot be described as developing, since they are not only stagnating, but even regressing. They are therefore in need of immediate aid, under the most favorable possible conditions.

At the Havana Conference, the nonaligned countries, now accounting for two thirds of mankind, adopted a number of concrete programs for joint action in international political and economic affairs. Their objective is to break the deadlock and step up the resolution of key issues of the world economy and the contemporary world at large.

The present crises in the world economy stem from deep discrepancies caused primarily by the existing system of international economic relations. A system that is so relentlessly detrimental to developing countries and keeps enormous human and natural potentials on the margins of economic trends inevitably imposes growing difficulties on the world economy in general, including the economies of developed countries. The belief that the difficulties confronting the developed countries can be alleviated or transcended by simply shifting them to developing countries is both shortsighted and dangerous.

We live at a time of growing interdependence in the world when, more than ever before, problems are interrelated and mutually conditioned. By the same token, new knowledge, technology, production capacities, and the overall achievements of the human mind cannot remain today within the bounds of a small circle of countries. They require a new latitude and the opening up of new vistas for the development and unprecedented progress of all countries in surmounting poverty and underdevelopment in the world. This is in the interest not only of developing but developed countries as well. No longer can anyone ensure his own well-being unless it is a part of the overall progress and prosperity of the entire international community. In brief, the responsibility we all bear for the present and future of the world, whose destiny we all share, must not be overlooked.

It goes without saying that international cooperation based on new foundations is indispensable for fuller utilization of the world’s creative potential and for focusing efforts on the substantive development issues. This cooperation must be rid of inequality, oppression, and the use of force aimed at preserving privileges and imposing the will of some on others. The nonaligned and other developing countries have always demonstrated their readiness for, and vital interest in, overcoming existing difficulties through cooperation based on equality, rather than through confrontation with the developed countries. Regrettably, this has not met with the necessary understanding on the part of many developed countries which have, moreover, even forsaken some of the decisions they had previously adopted in the United Nations, as was clearly demonstrated at the recent UNCTAD meeting in Manila.

In connection with this, I wish to emphasize that, although the expected results have not been achieved, the United Nations has so far made significant efforts toward the gradual transformation of international economic relations. In our view, the United Nations is best qualified to seek generally acceptable solutions for these and other current international problems. We must support it in these efforts, particularly now when the development strategy for the forthcoming Development Decade is being worked out.

The establishment of the New International Economic Order is the only way to achieve speedier progress and prosperity for all, and not only for the developing countries. In setting out their concept of the New International Economic Order at the Fourth Summit Conference in Algeria, the nonaligned countries were guided precisely by its universal significance and character.

However, we must note with regret that the process of transforming the existing economic relations is proceeding at a snail’s pace. The results attained so far in the negotiations on the establishment of the New International Economic Order are highly unsatisfactory. Relations in the financial and monetary field, which have a vital impact on economic activities, and thereby on development in the world, have been particularly slow to change. Far greater efforts, political readiness, and farsightedness are therefore called for in negotiations on the reform of the international monetary and financial system, in order to make it more responsive to the needs of developing countries and the world economy as a whole. In this regard, I have in mind more effective mechanisms for stimulating a much greater transfer of resources to developing countries. I also refer to accelerating the process of adjusting balances of payments and ensuring a more comprehensive role for it in attaining international liquidity. In addition, it is of paramount importance that the developing countries take as active a part as possible in all phases of decision making within these financial and monetary institutions, thus enabling them to become more democratic and universal.

Meeting these requirements is one of the fundamental prerequisites of the new international division of labor, and of the more equitable distribution of the achievements of economic and social progress. A great responsibility for fulfilling these aspirations also lies with non-aligned and developing countries. Hence, at their Sixth Summit, the nonaligned countries once again reaffirmed their commitment to strengthening mutual cooperation, with a view to employing in the best possible manner the material and other potentials available to them.

The Socialist Federal Republic of Yugoslavia has always advocated constructive and equitable international cooperation as the foundation of new democratic international political and economic relations. Developing its own potentials, on the basis of socialist self-management, and relying on them to the highest possible degree, Yugoslavia has supported international cooperation resting on solidarity and leading to concerted efforts for solving the crucial problems of the contemporary world, especially those facing the developing countries.

Our efforts for the establishment of new, more just, international economic relations also draw impetus from our reality—from the specific experiences of our country. As you know, Yugoslavia is a multinational country with inherited inequalities in its economic development. The results achieved in social and economic development and in strengthening our unity and cohesion can for the most part be ascribed to the fact that we have taken the utmost account of the interests of each nation and nationality, of the development of each republic and province, and thereby of the development of our community in its entirety.

There is no need to point out that the state of the world economy and international relations at the time when the Fund and the Bank were conceived in 1944 was completely different. However, the imperative need for aid on the grounds of solidarity has not diminished. On the contrary, it is in our common interest that the international financial and monetary system, including its basic institutions, accommodate without delay to the present-day international situation, and to the development needs which can be expected in the immediate future.

I am aware that identification of the concrete substance of the New International Economic Order in the monetary and financial fields is a highly complex and responsible process. In cooperation with nonaligned and other developing countries, Yugoslavia is contributing, to the limits of its possibilities, to elaboration of the necessary elements for reforming the system of monetary and financial relations. At their first meeting recently held in Belgrade, ministers of finance within the Group of 77 submitted specific proposals and took new initiatives to this end.

In 1945, when Yugoslavia became one of the 45 founding members, neither the International Monetary Fund, nor the World Bank, nor we ourselves, could have foreseen the great latitude that was to be created for bilateral cooperation with the passage of time. As a result of the development potential of our economy and the cooperation of these institutions with our Government, this latitude has increased considerably.

It gives me satisfaction to note that the officials of these institutions and our Government have continuously created and expanded opportunities for cooperation. These relations have thus been brought to the present level. As a developing country, Yugoslavia relies on the further promotion of this cooperation, which will continue to be in the interest both of the Yugoslav economy and these institutions, as well as of all the member countries.

In conclusion, I wish you fruitful and successful work in your quest for solutions conducive to equality, peace and prosperity, and blazing new trails to a happier future for all the people and nations of the world.

Delivered at the Opening Joint Session, October 2, 1979.

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