Situated just south of the US border, the glass and steel metropolis of Monterrey, Mexico, was the stage for the UN International Conference on Financing for Development, held on March 18-22, 2002.

The first-ever summit of its kind, the conference brought together hundreds of dignitaries, representatives from nongovernmental organizations and businesses, and leaders from international financial institutions. The main topic of discussion was how to raise the money desperately needed to alleviate poverty and promote growth in developing countries. While most observers saw the talks as a step in the right direction, concrete results of the conference were modest.

The fact that a gathering of this kind even happened might be considered a success in its own right. Given the events of the past year, few would have criticized industrialized nations for overlooking their underdeveloped neighbors. However, others argue that the current threat of terrorism has made it clear that developed nations can no longer ignore those who are less economically developed. After September 11, the link between poverty and terror is undeniable. Although exploring this connection was not the aim of the Monterrey conference, the idea that aid might effect some change in this regard must have lingered in participants’ minds.

When UN Secretary-General Kofi Annan called for this meeting over two years ago, he did so in an effort to push countries toward the goals of encouraging global development and reducing poverty outlined at the UN Millennium Summit. Prior to Monterrey, interest groups with vastly different views weighed in on the conference’s consensus document, the declaration that was to be adopted at the end of the conference. Recognizing the importance of this unique opportunity, interest groups expressed their hope that the conference would not be another rhetoric-filled entrenchment of the status quo. Sadly, aside from the promise of a modest increase in direct aid by the United States and the European Union, developing countries were left with little hope in the face of growing selfishness among the world’s richest countries. opportunity, interest groups expressed their hope that the conference would not be another rhetoric-filled entrenchment of the status quo. Sadly, aside from the promise of a modest increase in direct aid by the United States and the European Union, developing countries were left with little hope in the face of growing selfishness among the world’s richest countries.

Some might argue that the assurance of increased aid, particularly the US$5 billion pledge made by the United States to countries demonstrating effective governance and improved economic policies, is a minor miracle. However, the gap between the funds needed to address problems such as poverty, AIDS, and education and the money actually allocated to do so is growing daily. The World Bank estimates the shortage to be between US$20 billion and US$40 billion, while other sources approximate it at closer to US$100 billion. Closing this gap would require a doubling of the present amount of foreign aid given by donor countries; unfortunately, such a triumph was not achieved at Monterrey.

Moreover, the problem of unfair trade policy is more harmful in the long term than the immense funding gap. Certainly, direct aid is both useful and necessary in promoting sustainable economic development, but it is only a temporary solution. Monetary aid that is not embezzled by corrupt regimes or wasted on worthless projects may go a long way in combating disease and increasing life expectancy. However, funds will eventually run out and developing countries will be left in the lurch like before. Only a better and more balanced trade policy can solve this problem.

Unfortunately, the conference, which was dominated by neoliberal economic policies, failed to concretely address any of the inequalities of the global trading system. This was by far the most serious shortcoming of the conference. Any hope brought by the promise of more aid from developed nations must surely have been negated by the simultaneous knowledge that those developed countries would continue current trade practices. For an industrialized country, there is no sense in providing aid to a developing country to help it establish commercial enterprises and export industries if the industrialized country is going to refuse the products of the developing country entry into its own markets.

This is exactly what the United States and the European Union have done and will likely continue to do, according to the Monterrey Consensus. Industrialized countries have a long history of erecting stiff barriers against the exports of developing nations. What is most disturbing, however, is the suffering that those policies have caused in the developing countries and the refusal of the industrialized world to change them. Although agriculture and textiles represent over two-thirds of the exports coming from the world’s poorest countries, Western nations spend over US$1 billion a day protecting their farming industries alone. This protection comes at a huge cost to the world’s poor—a cost that far exceeds the sum of all the aid that those poor receive from the developed world.

At Monterrey, the wealthier nations continued to avoid making any specific commitments to lowering tariffs or reducing subsidies protecting particular industries. Instead, with a new trade war in steel looming on the horizon, wealthier nations sought to patch over this evasion by boosting direct assistance. Meanwhile, poorer countries will continue to suffer as wealthier nations maintain trade barriers. Current foreign aid and trade policies are not only paradoxical but also unequivocally harmful. Existing policies perpetuate the harm begun long ago, and Monterrey did little to change them.