Making globalisation work for all

Göran Persson©Swedish government/Pawel Flato

To launch this summit season, the OECD Ministerial Council and the Forum which precedes it present an important opportunity for ministers and civil society to update and refine the international policy agenda in key areas. For Sweden's prime minister, Göran Persson, who chairs this year's OECD Ministerial Council, four main areas stand out.

This year is one of great opportunity. I hope that 2005 will bring a stronger global commitment to shared growth, sustainable development and effective multilateralism. In July, the G8 will address climate change and poverty in Africa. In September, world leaders will meet at the UN Summit to advance global development and strengthen the United Nations. And in December, the WTO ministerial in Hong Kong could pave the way for further trade liberalization that may boost rich and poor countries alike.

To launch this summit season, the OECD Ministerial Council and the Forum which precedes it present an important opportunity for ministers and civil society to update and refine the international policy agenda in key areas.

We will meet under the unifying theme of “Enabling Globalisation”. I am looking forward to chairing our discussions on how to maximise and spread the benefits of globalisation to all countries and all people. It is evident that the high-income part of the world, which the OECD represents, bears a special responsibility in this endeavour. It is a question of solidarity and shared humanity, but also of self-interest.

To protect prosperity at home, we must be part of the sustained assault on poverty elsewhere. We can succeed only by engaging with the rest of the world. I am very pleased that ministers from key non-member states and developing countries will contribute to our discussions on how to better share the gains of globalisation. I expect us to make progress on some of the critical issues on the international agenda this year. The following four themes are of particular importance in my view.

Fighting poverty

We have made progress towards meeting the Millennium Development Goals, but results vary greatly by goal and by region. The good news is that we know that development works. The challenge now is to make it work everywhere. We must do more for those who live in the backyards of globalisation, especially in sub-Saharan Africa. I believe that a political momentum to this end is starting to build. OECD countries have collectively increased their development aid for three consecutive years, including by more than 4% last year, after three decades of stagnation and decline. But our collective aid effort still falls way short of the 0.7% of national income that we have pledged at the United Nations.

Fighting poverty should be an objective for all our policies. It is a task for finance, trade and agricultural ministers as much as for ministers responsible for development aid. We must be coherent in our approach. We cannot continue to give with one hand, and take with the other. It is my hope that OECD ministers will send a strong joint message to the UN summit in September 2005 on progress made and further efforts to fulfill the Millennium and Monterrey declarations. I expect that there will be broad agreement on the need to increase global aid volumes, to make assistance more efficient, to mobilise other resources for urgent development needs, and to eliminate trade-distorting subsidies.

Managing the environment

The point of departure for our deliberations is the realisation that today’s pattern of world energy consumption is unsustainable. The world’s near total reliance on fossil fuels is causing great environmental damage. At the same time, the OECD countries’ growing dependence on imports makes us economically vulnerable to high energy prices. But we can choose another path. I look forward to our discussions on ways to mobilise investment for increasing energy efficiency, finding new sources of energy, and developing cleaner technologies.

The objective of increasing energy investment should be two-fold: to maintain strong growth while tackling decisively the threat of climate change. In February, the Kyoto Protocol became a legally binding treaty. But not even if fully implemented does the protocol halt global warming and its grave consequences. More countries need to accept caps on emissions of greenhouse gases. And we urgently need to start looking at a climate regime beyond 2012.

Turning change into a chance

Globalisation is a powerful force. We must learn to live with increased competition and the rapid changes it involves. We have all to gain from structural adjustment that leads to a more efficient division of labour and faster growth. But competitive pressure can also give rise to periods of unemployment and insecurity that affect people's everyday lives. We must ensure that globalisation is not perceived as a threat. We must facilitate change by providing bridges from the old to the new. People must feel secure in order to seek the full benefits of change.

This is about education and lifelong learning. It is about broad social security and active labour market policies. It is about equal opportunities for men and women on the labour market. Equality, justice and welfare are advantages in the globalised economy.

I strongly believe in the close link between successful competitiveness and a strong welfare state.

Advancing the trade agenda

Open trade is a powerful engine for economic growth, employment and development. The implications of free trade reach far beyond economy. Poor and rich countries alike can gain from continued improvement and reform of the international trade system. Heading towards Hong Kong in December, I hope that all OECD members will engage constructively across the board to make progress in the Doha Development Agenda Round. A successful completion of the Doha Round is the best way to unlock the trading potential of developing countries and make a substantial contribution to development. The potential benefits are many times larger than the total official development assistance from OECD countries.

Globalisation offers great opportunity for all of mankind. Our task is to seize on the potential of globalisation while combating its costs and disadvantages. Let us take the opportunity provided by the OECD ministerial council meeting 2005 to make progress!

We could all be inspired by the compelling words of a Swede who towered on the international stage in the 20th century and who incidentally helped create what is today the OECD, former UN Secretary-General Dag Hammarskjöld, born a 100 years ago this year:

“Future generations may come to say of us that we never achieved what we set out to do. May they never be entitled to say that we failed because we lacked faith or permitted narrow self-interest to distort our efforts.”

©OECD Observer No 249 May 2005

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