Making globalisation work for the poor

By Kofi A. Annan

What is globalisation? Essentially, it means that today, more than ever in the past, groups and individuals interact directly across frontiers, without necessarily involving the state. This happens partly because of new technology, and partly because states have found that prosperity is better served by releasing the creative energies of their people than by restricting them.

The benefits of globalisation are obvious: faster growth, higher living standards, new opportunities. Yet, a backlash has begun. Why? Because these benefits are unequally distributed; because the global market is not yet underpinned by rules based on shared social objectives; and because, if all of tomorrow's poor follow the same path that brought today's rich to prosperity, the earth's resources will soon be exhausted. Thus the central challenge we face today is to ensure that globalisation becomes a positive force for all the world's people, instead of leaving billions of them behind in squalor.

If we are to get the best out of globalisation and avoid the worst, we must learn how to govern better at the local and national levels, and to govern better together at the international level. We must think afresh about how we manage our joint activities and our shared interests, for, many challenges that we confront today are beyond the reach of any state acting on its own.

That does not mean world government or the eclipse of nation- states. On the contrary, states need to be strengthened. And they can draw strength from each other, by acting together within common institutions based on shared rules and values.

Governments must work together to make these changes possible. But governments alone are not going to make them happen. Much of the heavy lifting will be done by private investment. Charitable foundations will also be very important.

Probably all the best ideas will come from outside government - from academic researchers, voluntary organisations, business, the media, and indeed the arts. All of these together make up ``civil society''. They have a vital role to play.

Last September, at the United Nations Millennium Summit, world leaders resolved to halve the proportion of people whose income is less than one dollar a day, the proportion of people who suffer from hunger, and the proportion of people who are unable to reach or to afford safe drinking water. They resolved to do all this by 2015.

History will judge this generation by what it did to redeem that pledge. It will judge the leaders of developing countries by whether they enabled their people to board the train of a transforming global economy, and made sure that everyone had at least standing room, if not a comfortable seat. And it will judge the rest of us by what we did to help the world's poor board that train in good order.

Success in achieving sustained growth depends critically on expanding access to the opportunities of globalisation. The countries that have achieved higher growth are those that have successfully integrated into the global economy and attracted foreign investment.

And that in turn depends in large measure on the quality of governance a country enjoys. Countries can only compete in the global market if their people have the benefit of the rule of law, with effective state institutions, transparency and accountability in the management of public affairs, respect for human rights, and a say in the decisions that affect their lives.

If developing countries succeed in creating the right economic and social environment, new technology puts many things within their reach that were previously not there. That is especially true of information technology, which does not require vast amounts of hardware or financial capital, or even energy. (It is also relatively clean.) What it does require is brain power - the one commodity that is equally distributed among the world's peoples. So for a relatively small investment - mainly an investment in basic education, for girls and boys alike - we can bring all kinds of knowledge within reach of poor people, and enable poor countries to ``leapfrog'' some of the long and painful stages of development that others had to go through.

In short, there is much that poor countries can do to help themselves. But rich countries have an indispensable role to play. For them to preach the virtues of open markets to developing countries is mere hypocrisy if they do not open their own markets to those countries' products, or if they continue flooding the world market with subsidised food exports, making it impossible for farmers in poor countries to compete. Nor can they expect developing countries to listen to their pleas to respect the global environment, unless they are ready to alter their own irresponsible patterns of production and consumption.

Developing countries must be enabled to export their way to prosperity. But many of the poorest - especially in Africa - will need a lot of help before they can do that. Everyone now agrees that the burden of debt must be lifted from the poorest countries. But rich countries have not yet come forward with sufficient resources to do it.

And many countries, whether indebted or not, need help to reach the stage where they can produce goods and services that the rest of the world wants to buy. They need infrastructure and technical assistance - not least in halting the spread of HIV/AIDS, now crippling some of Africa's strongest economies. Many also need help in resolving destructive conflicts and rebuilding a peaceful, productive society. Long ago, all Organisation for Economic Cooperation and Development (OECD) countries committed themselves to give 0.7 per cent of their gross domestic product in development aid. Very few have lived up to that promise.

Private companies, as well as governments, have an obligation to consider the interests of the poor, when making investment choices and when pricing their products. They are the biggest beneficiaries of globalisation: it is in their interest to make it sustainable, by making it work for all.

Only when ordinary men, women and children in cities and villages around the world can make their lives better, will we know that globalisation is indeed becoming inclusive, allowing everyone to share its opportunities. That is the key to eliminating world poverty.

(The writer is Secretary-General of the United Nations.)

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