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    Humanizing Globalization(2)


    © International Trade Centre, International Trade Forum - Issue 1/2006

    © WTO

    We need to address the "double face" of globalization and work towards sustainable economic and social development for all people.

    More and more people demand that we "humanize" globalization. In rich and poor countries, there is a widely-held perception that globalization has negative effects on some individuals. Increasingly, the public is of the view that we cannot ignore these effects.

    What is globalization?

    Globalization is a fundamental transformation in societies that is enabling individuals, corporations and states to influence actions around the world - faster, deeper and cheaper than ever before. Like the industrial revolution of the 19th century, today's technological revolution is rapidly recombining economic and social forces worldwide. The effects of globalization are clear to see in trade, but they go beyond. Globalization has pared back many barriers and has the potential to expand freedom, democracy, innovation and social and cultural exchanges while offering outstanding opportunities for dialogue and understanding.

    But some very worrisome phenomena are also a product of globalization: the scarcity of energy resources; the deterioration of the environment and resultant natural disasters; the spread of pandemics; the growing interdependence of economies and financial markets and the ensuing complexity of analysis, forecasts and predictability; and the migratory movements provoked by insecurity, poverty or political instability.

    It can be argued that in some instances, globalization has reinforced the strong and further weakened the already weak. It is this double face of globalization that we must address if we want to humanize it. To do this, we need to "reform" globalization, by putting more emphasis on sustainable economic and social development for all people.

    Nobody would dispute that there is a widening gap between the scale of global challenges, such as the environment, pandemics and others described above, and traditional ways of working out solutions. A notion of individual powerlessness and of political constraints upon governments is one striking consequence of this gap. And it is eroding trust in national systems of governance and weakening people's legitimate hopes of being able to influence their future, both of which are crucial for the sustainability of democratic systems.

    Yet it is not globalization that creates this feeling of anxiety, but rather the absence of means to tackle the effects of globalization appropriately. To address global challenges we need more governance at the global level.

    Global governance can help society achieve its common purpose with equity and justice. Our growing interdependence requires that our laws, our social norms and values, and other mechanisms for framing human behaviour - family, education, culture and religion, to name but a few - be examined, understood and brought together as coherently as possible to ensure collective and effective sustainable development.

    Towards a "world community"

    To support the interdependence of our world, we need, in my view, at least three elements:

    • First, we need common values. Values allow our feeling of belonging to a world community to coexist alongside national specificities. A debate about collective values, regional or universal, then becomes a necessity. This debate on shared values may allow us to define the common goals or benefits that we would like to promote and defend together on a global scale. These collective values provide the basis for world governance.
    • Second, we need actors with sufficient legitimacy to raise public interest in the debate, who can take responsibility for its outcome and who can be held accountable. We must also ensure that the collective interests of all people are taken into account in our management of international relations and in the way we operate our regional and global systems of values, rights and obligations. The problems and difficulties that we face may be local, regional or global, as are the interests to be defended and protected. Consequently, those representing these interests should take into account the needs of the societies that are affected by globalization. Potentially, international organizations have the capacity to take decisions which further their goals and the interests of their members. But they lack the means, instruments and political responsibility to play a wider and more decisive role.
    • Third, we need multilateral mechanisms of governance that are truly effective and can arbitrate values and interests in a legitimate way. These could also be described as mechanisms that guarantee respect for the rules, or as a form of international justice.
    The WTO is a small governance system which already has a few such elements in place. We oversee a multilateral system that recognizes different values, which includes a consensus on the benefits resulting from the opening-up of markets. But in our system, other values are recognized as well, such as the need to respect religion or the right to protect the environment. It is now clearly acknowledged that non-trade values can supersede trade considerations in some circumstances. Our system is based on states and governments but it has adapted to take into account new actors on the international scene. We also have a powerful mechanism to solve disputes.

    Improving trade development

    But the international trade system and the WTO are far from perfect. For the opening-up of markets to produce real benefits for members, we need rules that provide a level playing field, ensure capacity building and enable countries to improve their domestic governance.

    The opening of markets stimulated by the WTO has the potential to produce benefits for many but it also carries costs.

    We cannot ignore the costs of adjustment and the problems that can arise with the opening-up of markets, particularly in developing countries. They must be an integral part of the opening-up agenda. We must create a new "Geneva consensus": a new basis for trade opening that takes into account the resultant cost of adjustment. Trade opening is necessary for economic growth, but it is not sufficient in itself. Developing countries need help to build adequate productive and logistical capacity, to sharpen their ability to negotiate and to implement the commitments they make in the international trading system. Imbalances between the winners and losers of an opening-up of trade must be addressed, especially in the more fragile economies, societies or countries. Building such capacity and helping developing countries to adjust should now be part of our common global agenda.

    Part of this challenge falls to the WTO. But the WTO's core role is trade opening. We lack the institutional capacity to formulate and lead development strategies. The challenge to humanize globalization necessarily involves other actors on the international scene including the International Monetary Fund, the World Bank, regional development banks and the United Nations family, ITC and UNCTAD to start with.

    If we want to mitigate the impacts of globalization, we need to supplement the logic of market efficiency of the WTO with renewed attention to conditions which could favour development. For this we need to remember that trade is only a tool to elevate the human condition. The ultimate impact of our rules on human beings should always be at the centre of our consideration. We should work first for people and their well-being.

    Pascal Lamy has been Director-General of the World Trade Organization since September 2005.