Globalization a blind force that fails to recognize weak and strong

UNITED NATIONS, July -- Globalization is essentially a blind force that does not distinguish between the strong and the weak, the chairman of the Group of 77 told a meeting of the Economic and Social Council (ECOSOC) here.

Speaking on behalf of the Group of 77 and China, Ambassador Makarim Wibisono of Indonesia said that one of the lessons of globalization is that, while it brings about opportunities and challenges, benefits and risks, it also fails to make a distinction between countries with strong economies and those with weak economies.

"Therefore, trade, which could serve as an effective instrument in the management of globalization, must minimize all negative aspects and maximize the benefits to be shared equitably by all,'' he said.

"This is the most important challenge of the World Trade Organization (WTO) in the near future," he added.

In a position paper released to coincide with a high-level segment of ECOSOC, the G-77 said that globalization has been advocated as trigger to a whole range of new opportunities for development. Many countries, particularly in the industrial world, have already reaped the benefits of these opportunities.

But globalization, coupled with liberalization, have made the economies of developing nations much more vulnerable to certain external factors that are beyond their control.
"This phenomenon tells us that globalization and some of its corollaries, such as trade liberalization and free competition, do not automatically result in faster growth and development for the developing countries. In many cases, one can easily witness a number of troublesome results like the widening social and economic gap both between and within countries," he added.

Ambassador Wibisono told ECOSOC that in the context of globalization, the Uruguay Round is a major milestone in the efforts to gain market access for products from developing countries.

While multilateral trade liberalization has been pursued since the establishment of GATT 50 years ago, it was not until the completion of the Uruguay Round and the advent of the phenomenon of globalization that a significant leap forward was achieved. As a result, he said, significant improvements have taken place, numerous tariffs have been reduced and quota obstacles removed.

Yet, while these advances are impressive, he argued, the current chapter of trade liberalization is an uneven one, and faces major challenges that continue to block the major objective of achieving an open and rule-based multilateral system.

For one thing, the implementation of the Round remains substantially incomplete with many key areas of particular interest to developing countries left unimplemented.
These include to a large extent such crucial areas as exports of particular importance to developing countries, including those sectors where substantial tariff liberalization has been achieved and sectors characterized by dynamic export growth.

This, he said, reflects the fact that in the Uruguay Round, certain countries offered only small tariff reductions or none at all for some sensitive products. In addition, not all developing countries are able to take advantage of the trading oppurtunities offered in the globalized world, he added.

Ambassador Wibisono aslo pointed out that one of the persistent problems plaguing developing countries in in their efforts to implement the Uruguay Round is the lack of technical ability, particularly the least developed countries (LDCs), which is compounded by chronic external debts and supply-side factors.

While appreciating the efforts taken so far, he urged UNCTAD and WTO to continue providing the necessary technical assistance to countries in need.

The chairman also reiterated the fact that regional trading arrangements could represent constructive building blocs for a solid multilateral trading system. (IPS)