Towards a healthy multilateral system

The globalisation of recent decades has been associated with worsening income inequality, increasing violations of fundamental workers’ rights, environmental degradation and enduring abject poverty. While the OECD Forum 2004 has as its theme the “Health of Nations”, for much of the world’s population, the global economy is not working.

The global economy is dangerously volatile: extreme currency swings and the risk of stock market collapse are a recurrent feature, bearing an extreme cost in terms of poverty and unemployment. According to the World Bank’s Global Economic Prospects 2004, the number of people surviving on less than US$2 a day has reached 2.7 billion.

Such problems are most keenly felt in the highly indebted countries of the developing and transition regions, particularly the least developed. Although all the world’s nations adopted the Millennium Development Goals (MDGs) in 2000, it is clear to everyone that, barring exceptional efforts, those goals – themselves only a step on the way towards the eradication of world poverty – will never be attained by the target year of 2015.

Another contemporary problem relates very directly to the globalisation of world trade, and to the unintended consequences of the trade liberalisation that has been agreed at the World Trade Organization (WTO). In 2004 and over coming years, tens of millions of jobs in developing countries will be lost as the barriers to textiles and clothing trade come down and world production gets increasingly concentrated in just one or two locations, particularly in China. In other words, a decision that was promoted as a means of helping developing countries to increase their exports and, by extension, their peoples’ standards of living is going to have quite contrary results in many of the world’s poorest countries.

These problems bespeak a fundamental incoherence in the world’s multilateral architecture. While leaders may make a genuine commitment in one forum to achieving a commendable policy goal, there has never been adequate interinstitutional dialogue to translate that commitment into actions elsewhere in the international system to achieve the intended results.

In February 2004, a remarkable document was published that seeks to address this undesirable status quo. The report of the Commission on the Social Dimension of Globalization, A fair globalisation: Creating opportunities for all, argues for all organisations in the multilateral system to deal with international economic and labour policies in a more integrated and consistent way as a foundation for economic development and social justice.

The report, which the international trade union movement has hailed as a major breakthrough, calls for a globalisation policy forum to be set up by international organisations (such as the IMF, the World Bank, the ILO, the WTO and the OECD) to achieve a fairer form of globalisation, and which would address and monitor the social impact of developments and policies in the global economy. This forum must bring about cohesion between the international institutions on social issues.

To tackle a particularly egregious aspect of globalisation, the World Commission report calls for better conditions for workers in Export Processing Zones (EPZs). These zones, which according to the World Commission employ in excess of 50 million workers worldwide in countries as varied as the Dominican Republic and the Philippines, are often a hotbed of anti-union activity. Fundamental trade union rights are denied to workers, most of whom are women, as the zones are often beyond the reach of national labour laws which may themselves be weak.

Policy coherence initiatives between relevant international organisations should be established, according to the World Commission, to tackle just such by-products of the processes of globalisation. Here, there is a clear role for the OECD in view of its established expertise in this area, as manifested in its current project to examine the impact of trade-related structural adjustment.

The World Commission report further underlines the essential role of collective bargaining in promoting productivity and higher living standards, ensuring equality and giving workers a voice at the workplace. However, to achieve that function, it is key that the role of trade unions be supported by international organisations of real influence. The report targets the responsibilities of the international institutions and stresses the role they must play in ensuring that fair labour standards are not undermined.

Altogether, the implementation of the many recommendations of the World Commission would go a long way towards developing a more inclusive form of globalisation, one that might stand a chance of tackling poverty and falling living standards, and help make a move towards the realisation of the MDGs.

This will require that significant international meetings this year, such as the OECD Ministerial Council in May and the G8 Summit in June, give the report their full backing and start examining how to implement its findings. The OECD Forum 2004 needs to give those imminent meetings a clear indication of the level of support that the World Commission’s report enjoys among the OECD’s constituencies and, indeed, the public at large.

References

  • ILO (2004), For A fair globalization: Creating opportunities for all, Report of the World Commission on the Social Dimension of Globalization, Geneva, please click here
  • For further information on the OECD’s work on trade-related structural adjustment, click here

©OECD Observer No 243, May 2004




Economic data

E-Newsletter

Stay up-to-date with the latest news from the OECD by signing up for our e-newsletter :

Twitter feed

Suscribe now

<b>Subscribe now!</b>

To receive your exclusive paper editions delivered to you directly


Online edition
Previous editions

Don't miss

  • When someone asks me to describe an ideal girl, in my head, she is a person who is physically and mentally independent, brave to speak her mind, treated with respect just like she treats others, and inspiring to herself and others. But I know that the reality is still so much different. By Alda, 18, on International Day of the Girl. Read more.
  • Globalisation’s many benefits have been unequally shared, and public policy has struggled to keep up with a rapidly-shifting world. The OECD is working alongside governments and international organisations to help improve and harness the gains while tackling the root causes of inequality, and ensuring a level playing field globally. Please watch.
  • Read some of the insightful remarks made at OECD Forum 2017, held on 6-7 June. OECD Forum kick-started events with a focus on inclusive growth, digitalisation, and trust, under the overall theme of Bridging Divides.
  • Checking out the job situation with the OECD scoreboard of labour market performances: do you want to know how your country compares with neighbours and competitors on income levels or employment?
  • Trade is an important point of focus in today’s international economy. This video presents facts and statistics from OECD’s most recent publications on this topic.
  • How do the largest community of British expats living in Spain feel about Brexit? Britons living in Orihuela Costa, Alicante give their views.
  • Brexit is taking up Europe's energy and focus, according to OECD Secretary-General Angel Gurría. Watch video.
  • OECD Chief Economist Catherine Mann and former Bank of England Governor Mervyn King discuss the economic merits of a US border adjustment tax and the outlook for US economic growth.
  • Africa's cities at the forefront of progress: Africa is urbanising at a historically rapid pace coupled with an unprecedented demographic boom. By 2050, about 56% of Africans are expected to live in cities. This poses major policy challenges, but make no mistake: Africa’s cities and towns are engines of progress that, if harnessed correctly, can fuel the entire continent’s sustainable development.
  • OECD Observer i-Sheet Series: OECD Observer i-Sheets are smart contents pages on major issues and events. Use them to find current or recent articles, video, books and working papers. To browse on paper and read on line, or simply download.
  • How sustainable is the ocean as a source of economic development? The Ocean Economy in 2030 examines the risks and uncertainties surrounding the future development of ocean industries, the innovations required in science and technology to support their progress, their potential contribution to green growth and some of the implications for ocean management.
  • The OECD Gender Initiative examines existing barriers to gender equality in education, employment, and entrepreneurship. The gender portal monitors the progress made by governments to promote gender equality in both OECD and non-OECD countries and provides good practices based on analytical tools and reliable data.
  • They are green and local --It’s a new generation of entrepreneurs in Kenya with big dreams of sustainable energy and the drive to see their innovative technologies throughout Africa. blogs.worldbank.org
  • Interested in a career in Paris at the OECD? The OECD is a major international organisation, with a mission to build better policies for better lives. With our hub based in one of the world's global cities and offices across continents, find out more at www.oecd.org/careers .

Most Popular Articles

OECD Insights Blog

NOTE: All signed articles in the OECD Observer express the opinions of the authors
and do not necessarily represent the official views of OECD member countries.

All rights reserved. OECD 2017