The Bonn Economic Declaration:
Towards Sustained Growth and Higher Employment

Bonn, Germany, May 4, 1985

Introduction

  1. Conscious of the responsibility which we bear, together with other governments, for the future of the world economy and the preservation of natural resources, we, the Heads of State or Government of seven major industrial nations and the President of the Commission of the European Communities, meeting in Bonn from 2 to 4 May 1985, have discussed the economic outlook, problems, and prospects for our countries and the world.

  2. World economic conditions are better than they have been for a considerable time. Since we last met, further progress has been achieved in bringing down inflation and strengthening the basis for growth. The recovery in the industrial countries has begun to spread to the developing world. The debt problems of developing countries, though far from solved, are being flexibly and effectively addressed.

  3. Nevertheless, our countries still face important challenges. Above all, we need:
  4. Our discussions of these challenges have led us to the following conclusions:
    1. The best contribution we can make to a lasting new prosperity in which all nations can share is unremittingly to pursue, individually in our own countries and cooperatively together, policies conducive to sustained growth and higher employment.
    2. The prosperity of developed and developing countries has become increasingly linked. We will continue to work with the developing countries in a spirit of true partnership.
    3. Open multilateral trade is essential to global prosperity and we urge an early and substantial reduction of barriers to trade.
    4. We seek also to make the functioning of the world monetary system more stable and more effective.
    5. Economic progress and the preservation of the natural environment are necessary and mutually supportive goals. Effective environmental protection is a central element in our national and international policies.

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Growth and Employment

  1. In order to sustain noninflationary growth and higher employment, we have agreed that:
  1. Building on these common principles, each of us has indicated the specific priorities for national policies.

By pursuing these policies we will not only address our domestic problems, but at the same time contribute to an enduring growth of the world economy and a more balanced expansion of international trade.

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Relations with Developing Countries

  1. Sustained growth in world trade, lower interest rates, open markets and continued financing in amounts and on terms appropriate to each individual case are essential to enable developing countries to achieve sound growth and overcome their economic and financial difficulties. Flows of resources, including official development assistance, should be maintained and, wherever possible, increased, especially to the poorer countries. In particular, more stable longterm finance, such as direct investment from industrial countries, should be encouraged. We welcome longerterm debt restructuring agreements between debtor countries and commercial banks. We continue to stand ready, where appropriate, to negotiate further multi year reschedulings of debts to governments and government agencies.

  2. We continue to encourage the constructive dialogue with the developing countries in the existing international institutions with a view to promoting their economic development and thereby their social and political stability. We emphasize the crucial role of, and the improved cooperation between, the International Monetary Fund and the World Bank Group in supporting policies by debtor countries necessary to strengthen the confidence of domestic and foreign creditors and investors, to mobilize domestic savings and to ensure efficient use of resources and sound longterm development. We agree to work to ensure that these institutions are equipped with the necessary resources and instruments, and we stand ready to discuss an increase in the resources available to the World Bank which may be necessary in the coming years. We remain concerned over the particular problems facing a number of developing countries that are neither among the poorest nor foremost among the group of major debtors. We agree that consideration should be given to easing the financial constraints of these countries on a casebycase basis.

  3. We are deeply concerned about the plight of African peoples who are suffering from famine and drought. We welcome the positive response from our citizens and from private organizations, as well as the substantial assistance provided by the governments of many countries and the establishment by the World Bank of the Special Facility for Sub-Saharan Africa. We shall continue to supply emergency food aid. In addition, we shall intensify our cooperation with African countries to help them develop their economic potential and a longterm food strategy, based on their own agricultural programs. We are prepared to promote increases in food production by supplying agricultural inputs such as seed, pesticides and fertilizers, within the framework of agricultural development projects. We agree upon the need to improve the existing early warning systems and improve transportation arrangements. Political obstacles in the countries concerned should not be allowed to stand in the way of the delivery of food to the hungry. We emphasize the need to examine the establishment of a research network on dry zone grains. We shall strengthen our cooperation with African countries in fighting against desertification. Continued efforts are needed by all countries in a position to contribute to any or all of this work. We call upon the Soviet Union and other Communist countries to assume their responsibilities in this regard. We have set up an expert group to prepare proposals for followup measures to be reported to Foreign Ministers by September 1985.

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Multilateral Trading System and International Monetary System

  1. Protectionism does not solve problems; it creates them. Further tangible progress in relaxing and dismantling existing trade restrictions is essential. We need new initiatives for strengthening the open multilateral trading system. We strongly endorse the agreement reached by the OECD Ministerial Council that a new GATT round should begin as soon as possible. Most of us think that this should be in 1986. We agree that it would be useful that a preparatory meeting of senior officials should take place in the GATT before the end of the summer to reach a broad consensus on subject matter and modalities for such negotiations. We also agree that active participation of a significant number of developed and developing countries in such negotiations is essential. We are looking to a balanced package for negotiation.

  2. It is also essential to improve the functioning of the international monetary system. We take note that the Finance Ministers of the Group of Ten, at their meeting in Tokyo in June, intend to complete their current work on ways to improve the functioning of the monetary system and to put forward proposals, to be discussed at the next meeting of the Interim Committee of the International Monetary Fund in Seoul in October, with a view to making the international monetary system more stable and more effective.

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Environmental Policies

  1. New approaches and strengthened international cooperation are essential to anticipate and prevent damage to the environment, which knows no national frontiers. We shall cooperate in order to solve pressing environmental problems such as acid deposition and air pollution from motor vehicles and all other significant sources. We shall also address other concerns such as climatic change, the protection of the ozone layer and the management of toxic chemicals and hazardous wastes. The protection of soils, fresh water and the sea, in particular of regional seas, must be strengthened.

  2. We shall harness both the mechanisms of governmental vigilance and the disciplines of the market to solve environmental problems. We shall develop and apply the "polluter pays" principle more widely. Science and technology must contribute to reconciling environmental protection and economic growth.

  3. Improved and internationally harmonized techniques of environmental measurement are essential. We invite the environmental experts of the Technology, Growth and Employment Working Group to consult with the appropriate international bodies about the most efficient ways for achieving progress in this field.

  4. We welcome the contribution made by the Environment Ministers to closer international cooperation on environmental concerns. We shall focus our cooperation within existing international bodies, especially the OECD. We shall work with developing countries for the avoidance of environmental damage and disasters worldwide.

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Cooperation in Science and Technology

  1. We are convinced that international cooperation in research and technology in major projects should be enhanced to make maximum use of our scientific potential. We recognize that such projects require appropriately shared participation and responsibility as well as adequate rules concerning access to the results achieved, the transfer of technology and the use of technologies involved.

  2. We welcome the positive responses of the Member States of the European Space Agency (ESA), Canada and Japan to the invitation of the President of the United States to cooperate in the United States Manned Space Station Program on the basis of a genuine partnership and a fair and appropriate exchange of information, experience and technologies. Discussions on intergovernmental cooperation in development and utilization of permanently manned space stations will begin promptly. We also welcome the conclusions of the ESA Council on the need for Europe to maintain and expand its autonomous capability in space activity, and on the longterm European Space Plan and its objectives.

  3. We welcome the report from the Technology, Growth and Employment Working Group on the work done in the eighteen areas of cooperation and invite the Group to complete its review by the end of the year. We welcome the positive contribution which the Ministerial Conference on "Technological Development and Employment" held in Venice has made towards wider acceptance of the role of technological change in promoting growth and employment. We also welcome the results of the Rambouillet Conference on Bioethics and thank the Federal Republic of Germany for its willingness to host a symposium on neurobiology in 1986.

  4. We have agreed to meet again next year and have accepted the Japanese Prime Minister's invitation to meet in Japan.

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Source: U.S., Department of State, Bulletin, No. 2100 (July 1985): 3-6; Economic Summits, 1975-1986: Declarations (Rome: Istituto Affari Internazionali, 1987): 123-131; Great Britain, Foreign and Commonwealth Office, Declarations of Annual Economic Summits, 1975-1986 (London, 198-): A11 Bonn, 1-7 [unpublished]; Germany (West), Presse- und Informationsamt der Bundesregierung, Bulletin, No. 48 (May 7, 1985): 410-15; Germany (West), Presse- und Informationsamt der Bundesregierung, Pressemitteilung: Bonn Economic Summit 1985: Final Communiqué (Bonn).