Excellencies, Ladies and Gentlemen,
First of all I would like to thank the organisers for inviting me to talk on the very topical question of whether or not globalisation widens the gap between rich and poor.
I will try not to duplicate what has already been said and what is likely to be said by successive speakers. We have today distinguished experts among us who will be able to give us an authoritative account of the specific economic aspects of the topic.
I would like to give a different perspective on globalisation, namely on the potentially widening cultural gap between rich and poor countries. Cultural diversity is good, but so are the values and rights inscribed in the universal declaration of Human Rights. I am concerned that people in poor countries may be led to believe that the values inherent in globalisation run counter to those of their own cultures and traditions.
But before developing my argument, let me first give my opinion on the core of the subject today, namely whether globalisation widens economic differences between rich and poor. It seems fairly well established that at the overall, global level this is not the case. On the contrary, as pointed out in a recent study made by the World Bank, globalisation has integrated poor countries with around 3 billion people in the world economy and increased their economic output at a higher rate than rich countries, thus leading to convergence. In general, globalisation has not led to greater income inequality within countries, and the estimated decrease by 200 million in the absolute number of poor people globally, can largely be ascribed to the effects of globalisation.
But there are still countries comprising 2 billion people that have not yet felt the benefits of globalisation. So progress is not a given thing. In the 1990’s these countries even experienced a negative GDP growth per capita. Was this an effect of globalisation? Evidence suggests that these countries – rather than being damaged by - have been shunned by globalisation. For various reasons, such as poor policies, weak institutions, corrupt governments and – to a lesser extent – geographic, climatic, and historical disadvantages – they have not yet managed to find their niche in the global division of labour. To complete the picture, rich nations have protected their farmers and prevented poor agricultural economies from exporting goods that they are actually good at producing – thus adding to the exclusion of these countries from the global economy. Therefore, in order to bring the benefits of globalisation to every citizen of the world, we must work to ensure that globalisation becomes global!
Globalisation implies a massive exchange of information through magazines, television and the internet across national and cultural boundaries. Generally, information deepens mutual understanding and the information technology and communication revolution has opened up enormous possibilities for international cultural and commercial exchange. For example, new technologies offer news and information from all over the world, which can help the poor and deprived to be heard, and they serve as a very cost efficient way to market local products and industries worldwide. Some information, however, also carries the potential of exaggerating and deepening differences between cultures and civilizations.
A thoughtful friend of mine recently gave me an example of such a clash. He asked: How are low grade Western soap operas - which can now be watched worldwide on satellite TV - likely to be received by poor villagers in say Africa or in the Middle East? And I asked myself, does the kind of information and ideas transmitted through these types of entertainment contribute to intercultural understanding? Do they present a full picture of Western democratic and market based values? I fear that the very exposure of specific cultural values that comes with globalisation sometimes has a danger of increasing rather than decreasing perception gaps between rich and poor countries. And yet, trying to place restrictions on this flow of information would run counter to at least my idea of what the very spirit of globalisation is and should be. Besides, any such attempt would surely be doomed to fail.
At the European Council in Brussels on October 24 and 25 the Foreign Ministers of the European Union had a discussion about the root causes of international terrorism in the light of the terrible events in Bali and in Moscow. There seemed to be general recognition that there are clear linkages between international terrorism and the increasing unrest at a local level due to regional conflicts, power struggles, poverty, bad governance, and the lack of rule of law and respect of human rights.
But what can we do to mitigate these potentially harmful effects of globalisation? First of all, we must realize that the more frustrated and desperate people are – be it for economic reasons or be it for unjust and despotic regimes - the more responsive they are likely to be to fanatic incitement. And the other way round, the less real legitimacy a regime carries, the more prone it may be to resort to mobilizing people by means of fanatic incitement. There are many examples of countries and rulers applying this policy. Iraq is maybe an archetypical one. It represents a vicious circle that we must break.
On the basis of this understanding, we in the rich part of the world must act: First, through our own examples we must show that we actually care about the state of the globe and about the living conditions of our fellow man worldwide. For instance, through tough environmental standards and official development assistance, but certainly also by opening our markets to products that poor countries can produce and sell. The EU “everything-but-arms”-initiative is an excellent example. And in our foreign policy and elsewhere we must actively communicate a global vision to the people in the developing world. It should not be left entirely to the entertainment industry to define what are our cultural and moral values.
Second, we must pinpoint the linkages between democracy and the respect for human rights on the one side and sound economic development on the other. The financial crisis in Asia demonstrated the importance of transparency and truly independent and accountable institution to monitor banks and other financial corporations. We need those institutional checks and balances that only a democratic system can guarantee. Not authoritarian regimes where rulers place friends and family in critical positions, which eventually will poison a sound economic development.
Third, we must continue to criticise countries with poor human rights records but at the same time we must engage more actively in helping to set up the necessary structures to ensure a better performance. An approach where we only point our fingers at the things we don’t like can be counter productive and may lead to a strengthening of those regimes we want to criticise. That being said, we must never hold back criticising merely for the sake of our own convenience or selfish motives at the national level such as commercial contracts.
In his inaugural address in 1961, John F. Kennedy stated that ‘If a free society cannot help the many who are poor, it cannot save the few who are rich’.
This is not only true for nations. It also goes for our globalised world. I sense a growing general understanding that pursuing our own interests without concern for those of others will be detrimental to us in the long run. Not that we have not pursued such policies in the past in the form of, say, development assistance. The difference now is that our interdependence – as evidenced by for instance the environmental problems pertaining to global warming and the terrorist attacks on September 11 last year – is being felt and understood much more broadly than has ever been the case before. In that sense, one may argue that globalisation has brought us much closer together rich and poor alike.
Obviously, we in the rich countries cannot base our wealth on the degradation of the environment and the health of workers in developing countries. If the developing countries cannot provide decent living conditions for their citizens, we will experience increasing pressure on our borders. It is in our own interest to help and contribute where the problems are.
Together with consumers, private companies and business play an ever more central role in securing a sustainable globalisation. We are seeing the emergence of a completely new corporate culture based on global social responsibility. Also, there is an increasing awareness that we cannot only rely on public regulations and prohibitions any longer. In this regard, it was encouraging to see the high profile of the international business community at the World Summit for Sustainable Development in Johannesburg earlier this year. In order to find solutions to the pressing environmental and social problems we need to forge innovative partnerships between governments, business and consumers.
Finally, let us remind ourselves that globalisation is not a given thing. Globalisation is what we make of it.