Oleh/By		:	DATO' SERI DR. MAHATHIR BIN MOHAMAD 
Tempat/Venue 	: 	SHANGRI-LA HOTEL, KUALA LUMPUR 
Tarikh/Date 	: 	05/05/86 
Tajuk/Title  	: 	THE OPENING OF THE SOUTH-SOUTH 
			II CONFERENCE 




Your Excellencies, Distinguished Delegates, Ladies and Gentlemen.

Firstly, on behalf of the Government of Malaysia and of myself, I would
like to welcome all the distinguished participants of South-South 11
Summit of Third World Scholars and Statesmen.

2. Malaysia feels greatly honoured to have you here. We are here to
discuss very serious problems; problems that affect the life and death of
more than a billion people living in the developing countries. We are
concerned people. But serious though the discussions may be, it is still
necessary for us to relax a little. I hope you will find the time to see a
little of Malaysia,at least of Kuala Lumpur. I hope also that you will
take back fond memories of Malaysia along with the very serious
resolutions and plans of actions that we will be making in the next few
days.

3. We meet today at a time of severe adversity for the peoples of the
South; economically, socially and politically. The undermining of the
economies of our countries is unprecedented in scope. Here and there we
see military assaults, either directly or through proxies. For some the
fight for independence is not over yet. The blacks of South Africa are
being hounded and hunted in order to sustain the most despicable system
ever invented by man, apartheid. The indebtedness of the South is now
legendary. They are weighed down by debt burdens which will subject them
to all manner of manipulations and economic oppression for the forseeable
future. The terms of trade get worse and worse with the passage of time,
with seemingly no hope of ever getting alleviated.

4. We meet indeed at a time of severe adversity for us and it behoves us
to bear this in mind all the time we discuss our problems and suggest
solutions to them.

5. Let us take firstly the economic situation of the South. We are by and
large exporters of primary commodities We hope that with the foreign
exchange we earn we could develope our countries and purchase the
manufactured goods we need.

6. But in the last few months there has been a total collapse of all
commodity prices. An economic journal estimated that at prices prevailing
three months ago the developed countries would save 60 billion dollars on
the commodities they import. The figure must be more now as prices have
plunged deeper. The aid given by developed countries to the South never
came anywhere near this figure. Yet now, de facto, the developing South is
aiding the developed North by over 60 billion dollars a year.

7. But what of the manufactured goods the South imports from the
North? One would think that with cheaper raw material inputs the prices
would go down. Tha fact is that it has not. The old escalating prices of
manufactures remain and are aggravated by the appreciation of the
currencies of the North against the South. The terms of trade have thus
become worse and along with it the poverty of the South. It is ridiculous
to suggest that the developing countries are now smiling because reduction
in petroleum prices has brought relief. The fact is that reduction of
crude prices by 65% has not resulted in the same degree of reduction in
petroleum product prices. Other costs intervene and these costs are not
due to the producers.

8. At the very same time, we are bearing a heavier burden in servicing our
debts. When the countries of Europe got together with Japan to solve the
problem of excessive exports to the United States,they decided to revalue
upwards their currencies. They succeeded, but their trade problems refused
to go away. However, for the developing countries debt servicing has
become more burdensome as their currencies depreciated against those of
Europe and Japan and even against the US dollar.

9. As devaluing the dollar has not decreased European and Japanese exports
to the US, they are now investing more in the United States to get around
United States protectionism. Thus the investment funds that could help
develope the South have been diverted, leaving the South with only a
trickle in capital inflow. It looks like the North has become an enlarged
economic block, buying only cheap raw materials from the South, and
dumping their excess of manufactured goods. The markets of the North are
almost completely closed to manufactured products of the South. While the
North continuously search for substitutes for the raw materials of the
South, they also work to ensure a glut so as to bring down the price of
these materials.

10. In the meantime direct and indirect military attacks and subversion of
the developing countries continue. Colonialism is not dead. It has merely
taken new forms. A weak and unstable Government is as good an excuse for
military assaults as is a strong Government. Indeed all the Governments of
developing countries are made out to be bumbling, incompetent and corrupt
as if the North istotally free from these traits.

11. The South African Government remains the most blatantly racialist
regime in the history of the world. That it can exist in this day and age
is due in part to the support it gets from its sympathisers in the
North. People who are prepared to take direct military action against a
Government for allegedly promoting terrorism,advocate gentle persuasion
when dealing with the open terrorism practised by the South African
Government. We do not expect the Pretoria regime to be bombed out of
existence, because we do not believe in such a line of action. But when
will those with the economic clout apply sanctions? Or is it that African
lives are cheap, and that investments in South Africa are too profitable? 

12. The broad-based and multi-directional attack on us is no less serious
because we cannot identify a single enemy state. It is no less devastating
because we do not see armed and uniformed men invading our shores. We have
won the right to govern our own countries but whether we are independent
is another thing. Economically, of course, we have never been
independent. We have no control over transport and insurance, marketing
and prices and at times even over production. Our situation can only be
described as deplorable. Before we can make it any better, we must prevent
it from getting worse.

13. The holding of this Conference on South-South Cooper ation could not
have come at a more opportune time. Looking back on the past three years
since the first South- South Conference was held in Beijing, we must all
feel deeply conscious of the suffering and trauma experienced by
practically every single country throughout the South during this
period.The problem of plummetting prices for the fruits of our labour and
our soil, the problem of mounting debt in many countries, especially those
in Latin America, have imposed unbearable strains on our economies. In
Africa the battle for survival remains as grim as ever. In Asia too, after
making some headway we are experiencing sizeable declines in our growth
rates as more and more barriers go up against our exports. It is
frightening to realise that we are not in charge of ourselves and that a
few countries, indeed a handful of people can make or break us.

Ladies and Gentlemen, 

14. A few years ago we proposed a New International Economic Order. It was
an equitable proposal, considering that all countries are interdependent
and that even the North must depend on the South for prosperity. We are
their market for goods as well as loans. Surely the prosperity of the
South will lead to greater prosperity for the North. We asked only for an
equitable share.

15. But we have to acknowledge now that the New International Economic
Order was a non starter. The developed countries turned it down flat. The
laws of supply and demand, the marketplace, they say must prevail. We must
not meddle with them through artificial policy decisions.

16. But is it true that the laws of supply and demand determine the
economy of the world? Is protectionism a part of that law? Is subsidy an
integral part of the market-place?How does a poor country compete when
conditions are placed on aid; conditions not to buy from other sources,
not to set up industries of a certain kind? How do poor countries with no
ability to subsidise exports compete with the rich? How do we counter the
practice of dumping excess goods at below cost? 

17. We have tried to bring order to trade in commodities by elaborate
Commodity Agreements and the operation of Stockpiles. But they have never
really worked, despite the prohibitive cost. Many of us with pressing
needs for funds, bypass the Agreement. Many others refuse to join. The
recent massive glut has dealt a death blow to Commodity Agreements. We the
producers of the South are more vulnerable than ever. We have nothing to
fall back on. All the other commodities are equally affected. We have no
manufactured products to export in the place of commodities.

18. The collapse of the commodity trade results in unemployment which in
turn leads to political instability. If the Government is weak it may
fall. The succeeding Government can do no better because the causes of
economic recession are external,beyond the control of the
Government. Political instability would then become continuous, further
preventing economic recovery. A vicious circle is started which escalates
inexorably.

19. The seven major industrialised countries of the North are today
meeting in Tokyo at their Annual Economic Summit. Their deliberations and
decisions, whether these relate to the debt problems, interest rates,
protectionism, exchange rates or to global liquidity, will all have far
reaching impact on the global economy. And yet we in the South whose lives
will be crucially affected by the decisions of this summit will have
absolutely no say in their deliberations. It would seem that not only is
the New International Economic Order rejected but the North has responded
with closing their ranks and creating their own economic order for the
world.

20. In the face of this refusal by the rich to consider even enlightened
self-interest when dealing with the South, how should we react? Should we
set up an organisation of the states of the South as the United Nations
was set-up? Should we put-up a united front? Should we draw up a
comprehensive policy which will govern all our actions when dealing with
the North? 

21. We already have the Non-Aligned Movement, largely an organisation of
the South. We have the group of 77, also a grouping of the South. We have
the Organisation of Islamic Conference or OIC, the OAS and others. Would a
new organisation do any better? 

22. The answer is obvious. We do not need another organisation. All we
really need is the recognition that unless we help to strengthen each
other we are not going to be in a position singly, or in a group to get
fair treatment from the North. The North believes in strength. They deal
differently with the strong and differently again with the weak. Obviously
the best results can only be obtained by us if we are strong.

23. But how do we become strong, if we cannot unite? Of course, it would
be good if we can unite. But too many countries with too many different
interests just cannot unite. We have to recognise this and do the next
best thing. We can cooperate bilaterally or regionally, so long as our
partners are from the South. It is not something that can be achieved
overnight. Nor will the result of cooperation manifest itself
immediately. But any intercourse between the countries of the South must
lead to a strengthening of their position, just as any quarrel between
them must open them to all kinds of manipulation by outsiders.

24. Many of us in recent years have made special efforts to strengthen our
bilateral cooperation with countries in the South. We in Malaysia have
devoted most of our energies to strengthening our cooperation with our
ASEAN neighbours and with a cross section of countries in the Asia and
Pacific region. We have also made a special effort, notwithstanding the
problem of distance, of trying to develop areas of cooperation with some
countries in Africa.

25. Take education for example. The setting up of an international
university can effectively reduce part of the billions that flow North
because we send students there. These students studying in developing
countries together with others also from developing countries will develop
contacts that will help our relations later on.

26. Educational institutions are just an example of how we can help
ourselves. There are many other practical areas which will help us reduce
our dependence on the rich while saving our hard-earned money. Since money
means power, we will in fact be contributing towards the power of the
South.

27. Although Commodity Agreements have not proven successful, Malaysia
feels there is merit in cooperation among conmodity producers in research
and development, the dissemination of relevant information and
marketing. It is for these reasons that we have formed the Tin Producers
Association and the Association of Natural Rubber Producing Countries. In
the past research and development and even marketing was done by the major
consumer countries. Naturally their priority is to economise on
consumption and possibly develope substitutes -both of which are
detrimental to our exports. By doing our own research and development we
hope to discover new usage and to enhance the value of our produce.

28. We feel that bilateral cooperation and regional groupings have a lot
to contribute towards South-South cooperation. The fact that two countries
of the South are working together outside the Group of 77 or the
Non-Aligned Movement does not mean that the objectives of South-South
Cooperation are not being achieved. A multiple of groups of twos or
regional groups helping each other is as good as having a full-scale
South-South Cooperation. Even if they compete with each other it is not
too harmful. Sooner or later they will have to come to terms with each
other if they wish to survive.

29. It would be wonderful if all the hundred over countries of the South
can stand united and cooperate with each other in order to overcome
economic, political and social problems. But the truth is that that
scenario can only happen in dreams. Bilateral or group cooperation on the
other hand is real and practical. While we wait for the ideal, we should
do the possible.

Ladies and Gentlemen, 

30. At the Non-Aligned Summit in New Delhi in 1983, we adopted a
Declaration on Collective Self-Reliance. According to this Declaration,
the leaders of the South pledged themselves to strengthen South-South
cooperation on a priority basis. The Summit in Delhi also adopted a
Comprehensive Action Programme geared to producing tangible benefits for
the South through their cooperative efforts in different sectors. As we
turn our sights to the forthcoming Non-Aligned Summit in Zimbabwe, we
should be prepared to admit that the Delhi Declaration on Collective
Self-Relience amounted to no more than a paper pledge. Our collective
performance has been dismal.

31. All the members of the Non-Aligned Movement, without exception, are
members of the Group of 77 and the goals and objectives of the Non-Aligned
Movement and the G77 in the pursuit of South-South cooperation are
identical. It is both necessary and desirable that there should be a close
harmonisation of the South-South programmes of the Non-Aligned Movement
and the wider and more encompassing Group of 77. Indeed the institutional
machinery and programmes of one should be readily available to service
those of the other. Wherever possible we should have common programmes for
both bodies. Here I would like to commend the useful work done by the
International Centre for Public Enterprise at Ljubljana. This Centre,
which is now also serving as the Secretariat for ASTRO (The Association
for State Trading Organisations) has a number of useful South-South
programmes to its credit.

32. The Caracas programme of Action which was adopted at a high level
meeting of the Group of 77 in 1981 should serve as the basic framework --
the centre of our efforts -- for promoting economic cooperation in the
South. Unfortunately again no tangible benefits have been derived by
member states from this programme.

33. The one area which hold promise for the Caracas Programme is the
effort to establish a General System of Trade Preference (GSTP) within the
framework of which they could lower their barriers to each other, thereby
facilitating trade flows in the South. The GSTP negotiations are currently
underway and I am sure that we would all like to see these negotiations
advance as rapidly as possible.

Ladies and Gentlemen, 

34. Institutions are no panacea. In the final analysis it is what the
members are prepared to do that determines the success or otherwise of an
organisation. Nevertheless a co-ordinating body of some sort must provide
the necessary reference point if there is to be a common approach in any
field of activity. For the purpose of South-South cooperation the Caracas
Programme of Action already provides the nucleus for a Secretariat.What we
need now is acceptence on the part of member countries of the Group of 77
and proper funding.

35. One of the objectives of this meeting should be not simply to identify
areas of South-South cooperation, but to spell out clearly what measures
should be adopted to implement these programmes. We will not see any
progress until and unless we commit ourselves to certain specific targets.

36. Information about developing countries, especially with regard to
economic activities and policy is very scanty. It would be a good thing if
the Secretariat of the Group of 77 actively gathers information for
distribution to interested third world countries.

37. An idea worth talking about is the assignment of a Minister from each
country to oversee South-South co-operation. He could monitor on the one
hand his own Government's orientation to South-South programmes. At the
same time, he could ensure that appropriate follow-up action is taken
following visits of delegations from the South.

Ladies and Gentlemen, 

38. We have assembled together here a galaxy of personalities, each of
whom has made an important contribution in a particular field or
discipline. You must put your wide-ranging experience and your proven
capacity for creative thinking to practical use. What we need from this
Conference are a few ideas and proposals which can lend credibility to
South-South co-operation. We need to find ways and means to mobilise the
private sector throughout the South; we must get our private sector to
inter-act with each other.

Ladies and Gentlemen, 

39. I have dealt at length on South-South economic co-operation. But there
are other areas where we can cooperate for mutual benefit. The cultural
field is one. There is a great need for us to know each other. We Malays
say, 'Tak kenal maka tak cinta' (Because we do not know each other,
therefore we do not love). There is a great deal of misinformation
originating from news media over which we have no control. It is time that
our own third world news agencies intensify their cooperation and provide
true and more sympathetic news about ourselves. They will say it is
propaganda but are not their slanted news northern propaganda? 

Ladies and Gentlemen, 

40. Our concentration at this Conference is on the economy. That is not to
say that politically the South is without major problems. The South has
many unresolved political issues. And among them the South African problem
certainly sticks out like a sore thumb.

41. When in the mid-60's Malaysia condemned the racialist regime of South
Africa and demanded that South Africa be booted out of the Commonwealth if
it continued with apartheid and oppression of black South Africans, we
were told that such an action would be detrimental to the blacks. Today
the same argument is trotted out at the Commonwealth Meeting in Nassau
when we demanded that sanctions be applied against South Africa.

42. Do we really think that black South Africans would be better off today
if South Africa remains in the Commonwealth? Are they better off now
because we do not apply sanctions? Are the shooting, killing, jailing and
torture of the blacks today evidence that they are better off because
sanctions are not applied? Has Nelson Mandela been released because no
sanctions have been applied? Would Steve Biko be alive today? 

43. The fact is that we are dealing, not with an inhumane regime but an
inhuman regime, a regime that is racist in the extreme. The only thing
that it will respond to is force. If we must meet terror with force, this
is the time to meet terror with force. The lives of black South Africans
are as worthy of revenge as the lives of anyone else. But it is not
revenge and killing that we are asking for. We are merely asking for
sanctions now by those whose economic clout has the necessary force. The
black South Africans are prepared to endure the pain of sanctions. They
ask for sanctions. Why do we give this excuse that we want to save them
from that which they are willing to endure? 

44. In the end we will have to do what we have to do. But how sad that we
should prolong the sufferings of the blacks of South Africa.

Ladies and Gentlemen, 

45. We talk often of the need for disarmament; that is that which involve
the big powers. But what is our record? In 1964 the Third World bought
$1.4 billion of weapons from the developed countries. By 1984 that figure
has grown to $29.4 billion. Isn't it about time we talk about arms
limitation among ourselves? No one disputes the need for defense
capability. But do we need to have mini arms races with our
neighbours?This guns before butter policy is killing us. We have to stop
this nonsense and, incidentally, we will also stop enriching the already
rich.

Ladies and Gentlemen, 

46. South-South II has been jointly sponsored by the Third World
Foundation and ISIS. I am certain that their cooperation will not end
here. Indeed, this cooperation between the Third World Foundation and ISIS
should spawn a network of the Third World research institutes, which would
collectively do research work on different aspects of South- South
cooperation. We need to pool our experiences and resources for this
important task.

47. South-South II could present us with a historic opportunity. I would
urge the distinguised members attending this meeting of Third World
thinkers and luminaries to galvanise the South into action through the
adoption of concrete proposals which can be readily implemented. Let our
work be meaningful and let us demonstrate our sense of purpose.

48. Additionally I would suggest an Independent Commission on South-South
Cooperation with a limited life span tasked with reporting to the Group of
77 on specific proposals for practical South-South cooperation.

Ladies and Gentlemen, 

49. We the South have many other problems. But I have said enough.

50. Each of our countries has gained political independence. But we have
been denied our economic freedom. This economic freedom and the sense of
dignity and pride that goes with it can only be secured through our own
efforts. South-South cooperation will enable us to cushion ourselves
against the arbitrary actions and decisions of a handful of countries. It
will enable us to maximise our advantages and make ourselves collectively
self-reliant.

Ladies and Gentlemen, 

51. The North is not our intractable enemy. There is little to be gained
by an attitude of confrontation. We have to speak the truth. We have to
say the obvious. But we will still work with the North, towards a better
world order. We must not forget that the North produced such people as
Olof Palme, whose untimely death is a grievous loss to all. We have
friends in the North and we must strive to work with them however
frustrating the effort. God willing, in time we will succeed.

Ladies and Gentlemen, 

52. Now, I have much pleasure in declaring this South-South II Conference
open.

Thank you