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His Excellency President Ricardo Lagos,
His Excellency Minister Ignacio Walker,
Ladies and Gentlemen,
This is the first non-routine trip that I have taken the initiative to
undertake as Director-General of the WTO and the fact that I have chosen
Chile to start this trip is not simply a result of convenience or
chance. I have made it a point to start this trip in Chile, because of
the exemplary role this country plays in international trade and in the
WTO. Chile has had a consistent policy of making foreign trade a factor
of development and has done it in a harmonious and efficient manner. At
the same time, it has had a concern with the social, the human side of
trade, especially under the competent authority of President Ricardo
Lagos, who I am proud to call a friend, and whom I salute with admiration
I am very pleased to be participating in today's seminar on Humanising
Globalization because this subject matter touches upon difficult
questions that MUST be addressed.
Do we need to, should we, humanize globalization? Why do we ask
ourselves this question? In my view, more and more people demand that we
“humanize” globalization because of the perceived negative effects that
globalization has engendered on some people. And we should care about
the effects of globalization on individuals. In this sense, I fully
agree with Ricardo Lagos that “human beings must be at the centre of the
world we are building, a world that must be able not only to think,
create, reason and dream, but also to dialogue.”
What is globalization?
Globalization can be defined as a historical stage of accelerated
expansion of market capitalism, like the one experienced in the 19th
century with the industrial revolution. It is a fundamental
transformation in societies because of the recent technological
revolution which has led to a recombining of the economic and social
forces on a new territorial dimension.
We can today say that globalization and increased market opening has had
very positive effects and some negative consequences.
Globalization has enabled individuals, corporations and nation-states to
influence actions and events around the world — faster, deeper and
cheaper than ever before — and equally to derive benefits for them.
Globalization has led to the opening, the vanishing of many barriers and
walls, and has the potential for expanding freedom, democracy,
innovation, social and cultural exchanges while offering outstanding
opportunities for dialogue and understanding.
But the global nature of an increasing number of some worrisome
phenomena — the scarcity of energy resources, the deterioration of the
environment and natural disasters (including recently, hurricane Katrina
and the Asian tsunami) the spread of pandemics (AIDS, bird flu), the
growing interdependence of economies and financial markets and the
ensuing complexity of analysis, forecasts and predictability (financial
crisis), and the migratory movements provoked by insecurity, poverty or
political instability are also a product of globalization.
Indeed it can be argued that in some instances, globalization has
reinforced the strong ones and weakened those that were already weak.
It is this double face of globalization that we must seek ways of
addressing if we want to “humanise globalization”. To do this, we need
to “reform globalization” with a clear view to enhancing the
development of social, economic and ecological aspects of humanity. This
is also in line with the millennium development goals that can be
achieved through a “reform of globalization from within and for
Nobody would dispute that there is a widening gap between global
challenges and the traditional ways of working out solutions, our
traditional institutions. One of the most striking consequences of this
gap — the notion of individual powerlessness and the political
constraints of governments — has two impacts: first, it impacts the
confidence and trust in the national system of governance, and second,
it destroys any hope of being able to influence one's future. The future
becomes a matter of anxiousness, because citizens are not convinced that
there is a captain to pilot their plane.
We need more global governance
It is not globalization that creates this feeling of anxiety, it is the
absence of the means to tackle it appropriately. In other words, it is
the absence of governance at the global level that is problematic. The
new issues raised by global crises and by certain political developments
oblige us to contemplate new forms of governance. To address global
questions, problems, threats, fears, at the appropriate level, we need
more governance at the global level responsive to emerging global
At the same time, globalization needs to be humanised: if solutions must
often be global, the negative effects on individuals and societies must
also be tackled. Humanising globalization means that we must take
care of the victims of globalization. To achieve this, global solutions
must be sought for addressing the negative impact of globalization at
all levels — individual, community and universal levels.
The two points which I would like to submit to you, today, are the
1. the reform of globalization implies enhanced “global governance”;
2. the example of international trade sheds light on both the
opportunities and the difficulties of this governance.
1. What is Global Governance? How can the interdependence of our world
be better managed?
For me, global governance depicts the system that helps society achieve
its common purpose in a sustainable manner, that is, with equity and
justice. Interdependence requires that our laws, our social norms and
values, and other mechanisms for framing human behavior — family,
education, culture, religion, to name only a few of them — be examined,
understood and operated together as coherently as possible so as to
ensure our collective, effective sustainable development.
In order to set the basis to enhance and promote the interdependence of
our world, we need, in my view, at least three elements:
First of all, we need common values: values allow our feeling of
belonging to a world community, embryonic as it may be, to coexist
alongside national specificities. Globalization brings into contact
peoples and societies which through history have made choices that are
sometimes similar, sometimes very different from one place to another. A
debate about collective values, regional or universal then becomes a
necessity. This debate on shared values may allow us to define the
common goods or benefits that we would like to promote and defend
collectively on a global scale. The systemic nature of those goods
requires very different handling from other objectives of international
cooperation. These collective benefits provide the basis for world
We need to favour the progression towards a Global Charter of values which
goes further than the UN Charter of Rights which is 60 years old. On this I
share Ricardo Lagos' view when he says that “we need to persist in our
efforts to ensure that democracy and freedom continue to spread and take
root in all regions of the world, because this is the way to build a
world that is not only fair, but also more secure, for all.”
Second, we need actors who have sufficient legitimacy to get public
opinion interested in the debate, who are capable of taking
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 interdependence that unites us can be reflected at
several levels of human activity. The problems and difficulties facing
us may be local, regional or global, as are the interests to be defended
and protected. Consequently, the representativeness of the interests
concerned should also be reflective and consistent with the aspirations
of the societies specifically affected by globalization and its
operational tentacles. International organisations have their own legal
personality and therefore the potential capacity to take decisions to
further the interests of the institution and its membership. But they
lack the means, instruments and political responsibility that would
allow them to play a more decisive role.
Third, we need a recognition that multilateralism is indispensable; we
need mechanisms of governance that are truly effective and that can,
inter alia, 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.
But we do not have to start from scratch! There are some embryos of
governance in international relations and we can learn from these how
to strengthen global governance.
2. The example of international trade sheds light on both the
opportunities and the difficulties of this governance
Although international trade is not the only one, it is a very visible
dimension of globalization; the WTO, as trade regulator, is definitely
at the heart of global governance.
I am fundamentally convinced that the international trading system and
its benefits, belong to all of us — it is an international public good.
And this has implications. Everyone should benefit from the ultimate
increase in wealth efficiency that results from the removal of global
distortions in prices and which encourages countries to produce
according to their comparative advantage. To quote Ernesto Zedillo, the
WTO is the only instrument that can be used to deliver the global public
good of non-discriminatory multilateral trade. I agree with him, as the
WTO is essentially public in consumption, its benefits should accrue to
The WTO is a small governance system where we already have a few
elements in place: we have a multilateral system that recognizes
different values, including a consensus on the benefits resulting from
market opening, but also other values such as the need to respect
religion or the right to protect the environment and it is now clearly
recognized that non-trade values can supersede trade considerations in
some circumstances. We have a system that is based on state and
government but which has been able to adapt to take into account new
actors on the international scene; and we have a system that has a
powerful mechanism to solve disputes.
But the international trade system and the WTO are far from being
perfect and many things could be improved. For the opening up of markets
to produce real benefits in the everyday lives in the countries
concerned we need rules that provide for a level playing field, that
ensure capacity building, and that enable Members to improve their
But while the opening up of markets stimulated by the WTO has the
potential to produce benefits for many, it also has its costs, whose
distribution is largely beyond the WTO's control.
We cannot ignore the costs of adjustment, particularly for the
developing countries, and the problems that can arise with the opening
up of markets. These adjustments must not be relegated to the future:
they must be an integral part of the opening-up agenda. We must create a
new “Geneva consensus”: a new basis for the opening up of trade that
takes into account the resultant cost of adjustment. Trade opening is
necessary, but it is not sufficient in itself. It also implies
assistance: to help the least-developed countries to build up their
stocks and therefore adequate productive and logistical capacity; to
increase their capacity to negotiate and to implement the commitments
undertaken in the international trading system; and to deal with the
imbalances created between winners and losers from trade opening —
imbalances that are the more dangerous to the more fragile economies,
societies or countries. Building the capacity they need to take
advantage of open markets or helping developing countries to adjust is
now part of our common global agenda.
Part of this challenge falls under 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 humanise
globalization necessarily involves other actors in the international
scene: IMF/WB and the United Nations family.
I remain convinced that the WTO's mandate of opening up markets
represents an essential contribution to the development of so many human
beings on our planet. Favouring sustainable development strategies that
take into consideration the individual and collective interests of all
will contribute to humanising globalization.
Globalization involves international cooperation. We can only succeed if
we want to live together and if we are prepared to work together; we
must invest in international cooperation. This cooperation requires
political will and energy and implies accepting the debate on the
benefits and costs of cooperation.
Taking into account its potential impact on individuals, we need to
politicize globalization — in other words, if we want to mitigate the
impacts of globalization, we need to supplement the logic of market
capitalism efficiency of the WTO with a renewed attention to the
conditions in which that logic 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
human beings and for the well-being of our humanity.
I want to believe that the new “Geneva Consensus” has the potential to
succeed in contributing to the process of humanising globalization and
establishing further justice and equity.