United Nations Industrial Development Organization Essay ⋆ Business Essay Examples ⋆ EssayEmpire

The United Nations Industrial Development Organization (UNIDO) was established in 1966, with headquarters in Vienna, Austria. UNIDO became a specialized agency of the United Nations (UN) in 1985. As a result, UNIDO has its own constitution and member states, and a regular budget. UNIDO works toward helping the developing countries in alleviating poverty and creating wealth through the development of the manufacturing sector.

The origin of UNIDO can be traced back to 1959, when the Industrial Section of the UN was separated out as a branch. Subsequently, the Industrial Section became a separate center as Industrial Development Center in 1962. The focus of the Industrial Development Center was on discussions and information dissemination. However, it was felt that this role needed to be broadened to include operational activities that could directly affect the industrial development of developing countries. As a result, UNIDO was created by Resolution 2152 (XXI) of the UN General Assembly in 1966. In the following years, several developing countries as well as intragovernmental committees suggested setting up a specialized agency. During the second general conference of UNIDO held in 1975 in Lima, Peru, the Lima Declaration on Industrial Development and Cooperation was adopted. The Lima Declaration expected developing countries to have a 25 percent share of global industrial output by 2000. To achieve this target, it was recommended to the UN General Assembly that UNIDO be converted into a specialized agency. However, industrialized countries had some concerns in making UNIDO a specialized agency, which led to considerable delay. It was only in 1985 that the formalities of converting UNIDO into a specialized agency were completed.

During the latter half of the 1990s, UNIDO faced challenges to its survival as many developed countries, which were also donors, quit the organization on the grounds that the organization was not run efficiently. It was also felt that with the end of the Cold War, there was no need for such an organization as industrial activities could be better carried out by the private sector. Between 1995 and 1997, several countries including the United States, Canada, Germany, the United Kingdom, and Australia withdrew from UNIDO. With a shrinking budget, UNIDO had to reform itself and find niche areas to create a place for itself. UNIDO streamlined its activities to make sure that there was no overlap with other multilateral agencies and started offering them as a package. The reforms did pay off, as UNIDO was ranked as the best specialized agency of the UN in a study by the UK Department of International Development in 2005. Some of the countries such as the United Kingdom and Germany have since rejoined UNIDO; however, the United States is still out of the organization.

UNIDO Activities

As of 2007, UNIDO had a membership of 172 states. Every two years, UNIDO holds a General Conference, which is its supreme governing body. The General Conference decides on policies and budget issues and appoints a director general every four years. UNIDO has two important organs—the Industrial Development Board with 53 members and the Program and Budget Committee with 27 members. These members are elected during the General Conference. UNIDO also has an Evaluation Group, which works as an independent evaluator of UNIDO projects. The Evaluation Group is under the Bureau for Organizational Strategy and Learning, which is the strategic think tank of UNIDO. Different UNIDO organs work based on the philosophy of result-based management and result-based budgeting.

UNIDO’s activities are centered on three themes: poverty reduction through productive activities, trade capacity building, and energy and the environment. UNIDO focuses on small and medium-sized enterprise development, the rural sector, and women in its poverty-alleviation efforts. With respect to trade capacity development, UNIDO helps in developing the technical infrastructure for international trade activities, along with direct support to the export sectors. UNIDO’s efforts on energy and environment conservation focus on helping countries fulfill their obligations on multilateral environmental agreements.

These efforts are in synchronization with several millennium development goals of the UN. UNIDO carries out these activities with the help of about 600 staff at the head office and about 500 staff in field offices around the world. UNIDO obtains its resources from donor countries, the United Nations Development Programme (UNDP), and several other agencies supporting the cause of poverty alleviation and environmental protection. UNIDO has been able to establish itself as an important UN agency. However, its future will depend on how efficiently it is able to pursue its goals.

Bibliography:

Department of Industrial Development, United Kingdom, “Assessment of UNIDO,” www.unido.org (cited March 2009);
International Business Publications USA, United Nations Industrial Development Organization (UNIDO) Handbook (International Business Publications, 2007);
Carlos A. Magariños, Economic Development and UN Reform Towards a Common Agenda for Action: A Proposal in the Context of the Millennium Development Goals (UNIDO, 2005);
A. M. Makombe, Women Entrepreneurship Development and Empowerment in Tanzania: The Case of SIDO/UNIDO-Supported Women Microentrepreneurs in the Food Processing Sector (University of South Africa, 2006);
United Nations Industrial Development Organization, www.unido.org (cited March 2009).

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