Globalization for the Rich

In 20 years, the world has come full circle: in the mid-1980s, the process of globalisation intensified with rich countries taking the lead in inter-connecting countries because it was in their interest. Now in 2006, the same rich countries find the process of globalisation — economic and ecological — too hot to handle. They have become a roadblock in the way of global integration. The question is, where will we go from here? Can we go back in time and close the processes of globalisation? Or can we go into the future so that the rich and powerful are made to comply with the needs of the rest? If the latter is the case, how will it be done?

Consider this. In 1986, the world began negotiations on the Uruguay Round, which culminated in 1994 in Marrakesh. But this is not all that was happening in that period. In 1988, the UN General Assembly met and negotiations began on the framework convention on climate change. In 1992, the convention was agreed upon, which set the stage for the manner in which the world would allocate the common atmospheric space to all nations. In other words, how the world would share its right to pollute in years to come.

By the mid-1990s, the world had stitched together the processes that would bind it together in the future. The developing south, with or against whom these agreements were being negotiated, was the hapless bystander. The issues were intensely technical and somewhat distant. Their impact would be felt in the future. They were negotiated in global capitals. Engagement was difficult.

In 2006, the issues are not so distant. The impact of climate change is beginning to show. And the south is the worst impacted. The trade agreements are hitting home. The south’s biggest competitive advantage — cost-efficient food and plantation crops — is being whittled away. It is being forced to open up its markets for import of cheaper and subsidised products of the industrial world, but it is not benefiting to the extent it needs to in the manufacturing and service sectors. Royalties and licence fees (an outcome of the TRIPS agreement) have grown faster than the earnings from global service exports over the 1995 to 2004 period.

The problem now has come full circle as well. As far as climate change goes, the US has stalled negotiations. The fact is that the US does not want to accede to emission controls because it will impact on its growth. The European Union (EU) and Japan hide behind its obduracy.

The case of global economic negotiations is similar, with the US, EU and Japan refusing to reduce the subsidies they provide to their farmers, regardless of what it means to the south. This is clearly crippling farmers of the south, who have to further discount their natural resources to compete in the world market.

The question now is: what will the world do when the most powerful proponents of globalisation are obstructing it? The problem is that economic globalisation has not gone together with political globalisation. In other words, the world does not have any way — democratic or legal — to make the rich and powerful comply with decisions taken by the majority, in the interests of all. This is the Achilles heel of globalisation. And it needs fixing.