Gozo Declaration Regarding Vulnerability and Resilience of Small States

CONCLUSIONS OF THE INTERNATIONAL WORKSHOP ON 
ECONOMIC VULNERABILITY AND RESILIENCE OF SMALL STATES
Organised by the Commonwealth Secretariat and the University of Malta
at the University Gozo Centre, Island of Gozo, Malta, 1-3 March 2004



Introduction

1. Twenty-six experts from all Commonwealth regions participated in a 
workshop on economic vulnerability and resilience of small states held at the 
University Gozo Centre, Malta, between 1 and 3 March 2004. These included 
academics, practitioners, policy makers, and representatives of international 
and regional organizations. 

2. This workshop took place in the context of preparations for the 
International Meeting for the review of the implementation of the Barbados 
Programme of Action for the Sustainable Development of Small Island 
Developing States (SIDS). The workshop discussed features of economic 
vulnerability of small states, particularly SIDS, and strategies for 
developing their resilience; and took account of the conclusion of the ad hoc 
expert group on Vulnerability Indices, which met in New York in December 
1997, that “as a group, SIDS are more vulnerable than other groups of 
developing countries”. The participants also discussed trade as the main 
engine of growth and development.

3. Participants noted that:
·       the regional preparatory meetings for the International Meeting, held 
in Samoa, Cape Verde and Trinidad and Tobago, confirmed that SIDS, as a 
group, face particular handicaps as a result of the economic, environmental 
and social vulnerability.
·       the Interregional Preparatory Meeting of SIDS, held in Nassau, The 
Bahamas in January 2004, reconfirmed the economic vulnerability of SIDS and 
called for the development of an economic resilience index. 

4. The participants also considered a number of issues that are of concern to 
small states, notably:
·       the issue of graduation from least developed country (LDC) status of 
a number of SIDS; and 
·       the need for special and differentiated treatment and necessary 
policy space for small states, particularly SIDS, within the World Trade 
Organization (WTO). 

5. Participants recognized the role that a focused conceptual framework on 
vulnerability and resilience building could play in addressing these 
concerns, as well as in strengthening national and regional policy 
approaches. They also recognized the need for participatory and collaborative 
schemes, involving all major stakeholders, to ensure the success of 
resilience strategies. 

Vulnerability and resilience of small states

6. The participants reaffirmed that the inherent economic vulnerabilities of 
small states have been internationally recognized. Such vulnerability arises 
from exposure to adverse external shocks beyond their control, as well as 
structural handicaps, exacerbated by inter alia a high degree of openness, 
export concentration and high dependence on strategic imports, remoteness and 
high transport costs, susceptibility to natural disasters exacerbated by 
climate change and sea level rise. These conditions pose serious handicaps 
for the sustainable economic development of small states.

7. Small states have not been complacent in this regard, and there are many 
instances of successful practices to build resilience that could be emulated. 
In this regard, technical and financial assistance and cooperation from the 
international community is of paramount importance to support efforts of 
small states to build their capacity to cope with their vulnerability and to 
build up resilience.

Recommendations for small states

8. In order to build resilience, small states should:
(a)     take steps to promote good governance by pursuing appropriate 
policies to ensure political stability and the enforcement of the rule of 
law, to address the issue of corruption, as well as to promote 
accountability, transparency and efficiency in the delivery of public 
services;
(b)     strive to create a sound macroeconomic framework, including low 
inflation, exchange rate stability, and acceptable fiscal and external 
balances;
(c)     undertake market reform by promoting fair trade practices and 
fostering competitiveness; 
(d)     enhance labour productivity and labour market flexibility with the 
collaboration and participation of social partners and other relevant 
stakeholders;
(e)     promote social cohesion, support poverty eradication and sustainable 
livelihoods and foster harmonious social development;  
(f)     protect and sustainably manage the environment, notably by taking 
steps to increase energy efficiency, promote waste management, improve 
freshwater resources management, and encourage sustainable use of 
biodiversity and natural resources; and
(g)     promote innovation, research and technology as sources of 
competitiveness.

9. In this context the usefulness of a resilience index should be explored.

Regional and international dimensions

10. The negotiating capacity of small states, particularly SIDS, should be 
enhanced by appropriate analytical tools, such as vulnerability indices. The 
support of regional and international organizations would strengthen this 
process.

11. The work carried out by the Alliance of Small Island States (AOSIS) in 
formulating a collective position for SIDS in international fora, in 
particular those where international instruments are negotiated, should be 
supported. Furthermore, the progress made in formalizing the AOSIS structure 
was welcomed.

12. Participants commended the work of the Commonwealth Secretariat to foster 
co-ordination among small states in their efforts to be considered as 
meriting special treatment within the WTO and the World Bank.

13. Participants expressed their gratitude to the international and regional 
organisations that have supported efforts by small states to promote their 
sustainable development. They were also appreciative of the work carried out 
by Universities and research institutions, notably the University of Malta, 
the University of the West Indies and the University of the South Pacific, in 
the interests of small states. Participants urged the continuation of this 
work within the context of the proposed SIDS University Consortium.


Recommendations for the international community

14. Participants urged the: 

a)      UN Commission for Sustainable Development to take note of the 
conclusions of the workshop at its preparatory meeting for the Mauritius 
International Meeting (14 to 16 April 2004), and to request the international 
donor community to support SIDS in their resilience-building efforts; 
b)      Relevant UN agencies, including the UN Conference on Trade and 
Development (UNCTAD), the UN Development Programme (UNDP) and the UN 
Environment Programme (UNEP), to continue providing support to small states, 
particularly SIDS, towards the promotion of sustainable development in 
general and resilience building in particular;
c)      International donor community, including multilateral financial 
organizations, to extend financial and technical support to small states in 
their efforts to cope with their inherent vulnerability and to build their 
resilience;
d)      The WTO to take account of the special trade concerns and needs of 
small states, particularly SIDS, and their vulnerabilities arising from trade 
liberalisation and globalisation, and accordingly consider granting special 
and differentiated treatment to such states.

Future Work

15. Recognising the importance of a rigorous framework on 
resilience-building, participants agreed on the need for the work to continue 
towards developing a resilience index as well as a broader set of tools to 
support national and regional policy making.

Acknowledgments

16. Participants expressed their gratitude to the Government of Malta and the 
University of Malta for their kind hospitality and warm welcome and for 
creating congenial conditions for a successful meeting.

17. The participants also thanked the Minister of Finance and Economic 
Affairs and the Minister for Gozo for their contributions to the 
deliberations, and the support expressed by both ministers in promoting 
measures in favour of small states.

18. The participants requested the Government of Malta to submit these 
workshop conclusions to the Secretary General of the UN for circulation as an 
official document of the UN.