GENEVA - After intense negotiations, capped by a special session of the General Assembly here, the United Nations has reached agreement on some key measures to address the economic and social impact of globalisation. There are several reasons why the Geneva meeting (June 26-30) aroused keen debate and attention, even allowing for the conference fatigue that tends to run high in the halls of the UN, among government delegations as well as civil society representatives who throng to these discussions.
In 1995, 117 heads of state and government gathered at the World Summit for Social Development in Copenhagen and made wide-ranging commitments to reduce poverty and improve employment and social integration. Progress towards those goals has been poor. More people live in poverty today than five years ago. More than half of the world's population lives on less than $3 a day. Market-led globalisation, powered by liberalisation and free capital flows and speeded by the information and technology revolution, would appear to have widened inequalities within and between nations.
The top fifth of the world's people enjoy 82 per cent of its expanding export trade and 68 per cent of foreign direct investment; the bottom fifth, a little over one per cent. The net worth of the world's 200 richest people rose from $440 billion in 1994 to more than $1 trillion in 1998. Of the world's 100 largest economies, 51 are corporations. The debacle at Seattle, site of the aborted ministerial round at the World Trade Organisation (WTO) meeting last December, epitomised the groundswell of anger and discontent with an economic and financial system seen to favour rich and powerful nations and corporations.
The Geneva meeting was therefore timely, even urgent in the aftermath of Seattle. It reviewed progress on the Copenhagen commitments and proposed intensified measures to redouble the efforts.
Key steps, in response to the recent South East Asian financial crisis, are aimed at reducing the negative social impact of international financial volatility. The agreement contains guidelines to improve the transparency of financial flows by strengthening the ability of countries and international institutions to monitor operations. This is of special significance to countries that attract speculative foreign investment capital. One of the most keenly debated topics was the feasibility of a currency transaction tax to deter speculative financial flows and generate resources that governments can use for social programmes such as poverty alleviation. The agreed language permits the UN to carry out a serious and analytical study to this end.
The question of access to international markets for products of developing countries was another keenly debated issue at Geneva. The agreement called for increasing and improving market access by negotiated reduction of tariff and elimination of "non-tariff" barriers.
Developing countries and economies in transition also scored a hard-won victory in calling for greater transparency and accountability in international financial institutions such as the International Monetary Fund and the World Bank. Agreement that fiscal austerity and economic reform policies should not lead to budget squeezes on public spending, especially in health and education, is crucially important. Vast populations of poor, women in particular, are badly hit by such cuts by governments in many countries implementing structural adjustment programmes or trying to service enormous debts.
Of vital importance to developing countries with high rates of HIV/AIDS and other major public health concerns is agreement that countries can freely exercise options under patent regimes to protect the availability of life-saving and essential drugs. Donor nations also agreed on concerted actions to relieve poor countries of their burden of unsustainable debt.
India, which was represented by a high-level delegation led by deputy chairman of the Planning Commission, K C Pant, at the meeting, has cause for some cheer on issues of market access and technology transfer. There is disappointment, however, at the lack of breakthroughs in the international macroeconomic environment. It is axiomatic that social development concerns are best dealt with at the national level, a senior external affairs ministry official told this paper. "We discuss them in international forums only to seek a more supportive international environment, whether in trade, technology, or resources. The stance of donor countries resulted in a standstill on these big issues".
On these issues, which traditionally divide North and South countries in international negotiations, both sides held their ground in Geneva. Developed countries called for good governance and labour and environment protections in developing countries. The latter interpreted these as donor fatigue and protectionism in northern markets. There was no more than lip service to the UN's languishing goal of 0.7 per cent of gross domestic product to be set aside for overseas development assistance. The levels of ODA fell to record lows in 1996; the United States, enjoying a sustained period of economic growth and prosperity, is at the lowest rung with ODA at 0.12 per cent of GDP.
There is gradual but growing acknowledgement in influential quarters that the central problem of the globalising economy is its uneven distribution of benefits: inequalities in income, employment and access to social services such as health and education. The World Bank is now less inclined to gloss over the evidence of deepening poverty and inequality in many countries as a result of its prescriptions of economic reforms, a mix of privatisation and fiscal austerity. No less a person than Michel Camdessus, former chief of the International Monetary Fund, the institution held responsible for the financial turmoil and ensuing misery in South East Asia, Brazil and Russia, described as "morally outrageous" today's gap between rich and poor.
The vast social debt left behind by globalisation, together with the new, if begrudging `mea culpa' stance in the international financial institutions (IFIs), are strong ammunition in the hands of those calling for development with a human face. They also place heavy responsibility on the UN, which must catalyse that elusive element called political will among its member-states. In short, the UN, at the Geneva meeting and beyond, is tasked with harnessing the politics of protest into policies for progress through accountability and social responsiveness.
* More people live in poverty today than five years ago
* The net worth of the world's 200 richest people rose from $440 billion in 1994 to more than $1 trillion in 1998
* Special session of the UN reached agreement on key measures to address the economic and social impact of globalisation
* World Bank is now more inclined to acknowledge deepening poverty and inequality in many countries
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