Objectives and guiding principles

D-8, also known as Developing-8, is an arrangement for development cooperation among the following member countries: Bangladesh, Egypt, Indonesia, Iran, Malaysia, Nigeria, Pakistan and Turkey. It also adds a new dimension to enrich the social and economic relations of its partners.

Following the “Conference on Cooperation for Development”, on October 22, 1996, and after a series of preparatory meetings, the establishment of D-8 was announced officially by the Summit of Heads of State/Government in Istanbul, on June 15,1997 (Istanbul Declaration).

The objectives of D-8 are to improve developing countries’ positions in the world economy, diversify and create new opportunities in trade relations, enhance participation in decision-making at the international level, and provide better standards of living.

D-8 is a global arrangement rather than a regional one, as the composition of founding members reflects. Membership will be open to other developing countries subscribing to the goals, objectives, and principles of the group, sharing common bonds.

D-8 is a forum with no adverse impact on bilateral and multilateral commitments of the member countries, emanating from their membership to regional and international organisations.

Principal organs

The principal organs of D-8 are the Summit, the Council, and the Commission.

The Summit, which is the supreme organ of D-8 is composed of the Heads of State/Government of member states. It is convened once every two years.

The Council is composed of the Ministers in charge of Foreign Affairs of member states. It is the political decision making organ of D-8, and acts as a forum for thorough and comprehensive consideration of the issues.

The Commission is the executive organ of D-8. It is composed of senior officials appointed by their respective governments. Each Commissioner is responsible for national coordination in his/her respective country.

An Executive Director is appointed to ensure efficient communication, expedite the flow of information, and supervise the provision of services for the meetings.

Areas of cooperation

At the outset, ten sectors have been identified for cooperation and project development. They are: Trade; Industry; Telecommunications and Information; Finance, Banking and Privatization; Rural Development; Science and Technology; Poverty Alleviation and Human Resources Development; Agriculture; Energy; Environment; and Health.

On the basis of a division of labour for the coordination of D-8 activities, each sector is assigned to a member country.

Although 50-60 projects were originally proposed at the First Summit, in order not to spread resources too thinly, the following six priority projects were selected to be launched immediately:

• Establishment of an International Marketing and Trading Company
• Workshop on Poverty Alleviation
• Establishment of an Industrial and Technological Data Bank Network among D-8
• Establishment of Takaful Schemes (Insurance), including joint ventures between the companies of D-8
• Cooperation for the Development of Inland and Coastal Aquaculture
• Design, Development, Production, and Marketing of Agricultural Aircraft

D-8 countries have large, young populations with a growing and increasingly skilled labour force

D-8 member countries have relatively large populations. The total population of D-8 countries was around 800 million in 1997. This corresponds to some 13.5 percent of the world population. In four of the eight countries the population is well over one hundred million, in one country it is more than two hundred million.

After relatively high annual growth rates recorded in previous decades, population growth is gradually coming down in all D-8 countries, similar to the phenomenon observed in the rest of the world. Due to rapid growth in the past, a large part of their population will continue to be young for the foreseeable future, constituting a factor of dynamism in D-8 societies.

Moreover, an increasing number of these young people are being educated and trained in universities and research institutions in order to meet the requirements of high-tech industries for skilled labour.

Population in D-8 countries

Source: World Development Report, 1997,World Bank; World Population Data Sheet, 1997, Population Reference BureauD-8 countries have growing economies and relatively high technologiesStarting from relatively modest income levels, D-8 economies have displayed respectable growth rates in the recent past. In all countries, governments have undertaken reforms to remove the bottlenecks to rapid growth, liberalise markets and integrate better with the world economy. Growth in incomes, coupled with the already large and increasing populations, will create rapidly growing markets in the coming years.

In most of these countries, the private sector has become the driving force of the economy. As a result, large holdings have emerged in recent years. Some now rank amongst the first 500 largest companies of the world. Their partnership with well-known firms of the industrialised world in high-tech industries such as electronics, automotive, etc. has helped build a significant technological and industrial base in D-8 countries.

Gross National Product in D-8 countries

Source: World Development Report, 1997, World Bank(*) When the purchasing power of US dollar and unaccountable services are taken into account, the figures in this column become much higher.D-8 Countries have a relatively rich resource base

Bangladesh is the largest jute exporting country, contributing 80 percent of world’s jute exports. Tea and rice are the other main agricultural crops. The discovery of natural gas in the Bay of Bengal indicates large reserves ready for exploitation.

Oil and gas reserves are Egypt’s main natural resource. While the size of the oil reserves is relatively modest by world standards, proven and potential gas reserves are substantial. Among the various other mineral resources, phosphate reserves are sizeable. In agriculture, Egypt produces and exports high quality cotton, rice, sugar cane, citrus and vegetables.

Indonesia is rich in both agricultural resources, and in oil and natural gas. Mineral resources include coal, tin, bauxite, copper and nickel. Indonesia is a major producer of palm oil, coffee, cocoa, natural rubber and wood products.

Iran has one of the oldest oil industries in the region, with 9 percent of the world’s known reserves. Natural gas reserves are also substantial, the second largest in the world. Iran also has mineral resources including iron ore and bauxite.

Malaysia continues to play a major role in the world market as a supplier of tin and rubber. Petroleum and natural gas production is gaining importance. The country remains the world’s leading producer of tropical lumber.

Nigeria has oil reserves of high quality with a low sulphur content and light gravity. There are also relatively large natural gas deposits, as well as a wide variety of mineral resources. In agriculture, cocoa remains a significant export item, after petroleum.

While fuel resources are relatively modest in Pakistan, the country boasts an extensive range of non-fuel minerals that includes, among others, magnesite, limestone, marble, and dolomite. In agriculture, Pakistan is a major producer of cash crops, such as cotton and rice.

Turkey has a diverse resource base. Given abundant water resources, the country has the capacity to produce a wide range of crops. Indeed, Turkey is one of the few countries in the world, self sufficient in food production. Moreover, for her energy needs, Turkey relies to a great extent (46%) on hydro-power obtained from water resources. There exists significant underground resources such as bauxite, chrome, iron ore and lignite.

Source: BP Statistical Review of World Energy, 1996

Source: BP Statistical Review of World Energy 1996

The share of D-8 countries in world trade is growing

An indication of the dynamism of D-8 economies is their rapid integration with the world economy. In recent years, their exports and imports, which constitute about 4 percent of the world total have been on the increase. Within a six-year period from 1990 to 1996, total exports of the D-8 countries increased by 87 percent. During the same period, increases in imports were even higher, at 93 percent. These large increases correspond to annual average growth rates of 10.4 percent and 11.0 percent for exports and imports respectively.

These rates are well above the changes in world trade as a whole which was at 5.5 percent during the same period. This obviously is an indication of the growing nature of the influence of the D-8 economies.

Main trading partners of the D-8 countries are industrialised economies. The majority of exports are destined for USA, Japan, Germany, and to a smaller extent, to UK, Italy, and France. With few exceptions, most imports originate from the same countries.

Main export items of the D-8 countries vary a great deal based on resource endowment, climate, and soil conditions. The bulk of these exports are oil and gas, agricultural products and textiles. Among import items machinery and transport equipment, iron and steel products, raw materials for textiles, chemicals, and certain food items are more important.

D-8 share in world trade
                                                             

Source: Direction of Trade 1997, IMF

Source: Economist Intelligence Unit, Country Profiles

Currently intra D-8 trade is relatively small but has prospects for growth

The volume of intra-trade among D-8 countries is rather low. Indeed, in 1996 it amounted to only 14 billion dollars. In return, during the same period, the total trade of the member countries with the rest of the world exceeded 400 billion dollars. Thus, D-8 intra-trade represents only 3.5 percent of their total trade.

Even a cursory review of trade statistics of these countries reveals the potential for increased trade among D-8 countries. For this reason, the development of intra-trade is set as one of the primary objectives of D-8 cooperation.

Intra D-8 trade

Source: Direction of Trade 1997, IMFNote: Global financial crisis has to a certain extent affected the D-8 intra-trade and the share of member countries in the world trade in 1998-99.http://www.mfa.gov.tr/d-8/

http://en.wikipedia.org/wiki/Developing_8_Countries

http://www.developing8.org/