General Assembly
Official Records
Fifty-fourth Session
Supplement No. 1 (A/54/1)

Chapter IV

Engaging with globalization

220. Globalization is a summary term for the increasingly complex interactions between individuals, enterprises, institutions and markets across national borders. The manifold challenges it poses, challenges that cannot successfully be addressed by nation States acting on their own, provide the most immediate and obvious reason for strengthening multilateral cooperation. Globalization is manifest in the growth in trade, technology and financial flows; in the continuing growth and increasing influence of international civil society actors; in the global operations of transnational corporations; in the vast increase in transboundary communication and information exchanges, most notably via the Internet; in transboundary transmission of disease and ecological impact; and in the increased internationalization of certain types of criminal activity. Its benefits and risks are distributed unequally, and the growth and prosperity it provides for many is offset by the increasing vulnerability and marginalization of others -- and by the growth of "uncivil society". During the past year, the United Nations has been examining the various dimensions of globalization -- economic, social, environmental and gender -- in some detail.

Economic and social dimensions

221. Only a year ago, a worldwide global recession was seen as a distinct possibility. Fortunately, such an outcome has thus far been avoided. Two years of crisis-induced international financial turbulence have nonetheless reduced global economic growth substantially. Other than Japan, the developed economies -- conventionally viewed as the engines of growth in the world economy -- have barely been affected, but the vast majority of developing and transition economies have experienced at the very least a slowdown -- and in some cases a reversal -- in economic growth, with its concomitant setbacks in social progress. The more favourable trends of the pre-crisis era may well be restored, but this will take time, and the losses of 1998 and 1999 can never be made up. Meanwhile, the world remains vulnerable to similar disruptions in the future, underlining the need for action to prevent such a possibility.

222. In the majority of countries, growth for the foreseeable future will fall short of what is necessary to reduce the number of people living in poverty. In developing countries as a whole, 1.5 billion people continue to live on less than $1 per day. Unfortunately the commitment of the international community to the eradication of poverty has yet to produce results.

223. During the year, the United Nations provided a valuable platform for dialogue on the financial crisis, the persistence of poverty, the marginalization of Africa and the least developed countries and other dimensions of globalization.

224. At the intergovernmental level, the General Assembly is increasingly engaged with globalization issues. In September 1998, the Assembly held a two-day high-level dialogue on the theme of the social and economic impact of globalization. This innovative process, which involved ministerial round tables and panels, drew together perspectives from Governments, civil society, the private sector and the United Nations system and demonstrated the United Nations unique ability to engage a broad range of stakeholders on issues of critical importance to the international community.

225. Recognizing both the challenges and opportunities that today's globalized financial markets present, particularly for developing and transition economies, the General Assembly decided in 1997 to consider convening a high-level international intergovernmental forum on financing for development, not later than 2001. In the first half of 1999, the Working Group of the General Assembly on Financing for Development agreed that the forum would address national, international and systemic issues relating to financing for development in a holistic manner in the context of globalization and interdependence. The Working Group proposed that the forum involve all relevant stakeholders, including IMF and the World Bank. In this regard, the Economic and Social Council has recommended setting up a joint task force of United Nations and Bretton Woods institutions to facilitate the further involvement of those institutions in the finance for development process launched by the General Assembly.

226. The Economic and Social Council conducted a number of internal debates on the socio-economic dimensions of globalization during the year, and is working more and more with its counterparts in the Bretton Woods institutions in tackling these broad issues. The second special high-level meeting of the Economic and Social Council with the Bretton Woods institutions was held in 1999 and was complemented by a number of exchanges between the Council and the Executive Directors of the World Bank and IMF. A further visit to the Council in the autumn of 1999 by the Executive Directors of the Bank and IMF, following their annual meetings, is being arranged. The Development Committee recommended that the United Nations further refine the principles and good practice in social policy prepared by the World Bank as follow-up to the World Summit for Social Development.

227. The functional commissions of the Economic and Social Council -- those addressing social development, the advancement of women and population and development -- continued their work on the follow-up to United Nations conferences. Each of these broad issues is profoundly affected by globalization. Major achievements were the finalization of the optional protocol to the Convention on the Elimination of All Forms of Discrimination against Women and the five-year review of the International Conference on Population and Development, conducted at a special session of the General Assembly in June/July 1999. At its substantive session of 1999 the Economic and Social Council focused on the related issues of poverty, employment and gender equality, and the development of Africa.

228. The impact of globalization on gender in the world of work is both important and complex. It is the focus of a major study, the 1999 World Survey on the Role of Women in Development, which has involved ILO, UNCTAD, the Department of Economic and Social Affairs and the World Bank, and which I will submit to the General Assembly.

229. The Commission for Social Development considered the impact of globalization on access to social services and recommended greater international coordination in the planning and financing of such services. The Commission on Population and Development considered the relationship between population growth, structure and distribution and sustained economic growth and sustainable development. The deliberations of that Commission highlighted how demographic challenges are affected by globalization, particularly with respect to the international movement of people and the spread of infectious diseases such as HIV.

230. The Commission on Sustainable Development dealt with a number of important challenges posed by globalization, including the management of the oceans, tourism, which is one of the fastest growing industries in the world economy, and the development challenges confronting small island developing States. It has proposed, among other ideas, steps for strengthening the work of the General Assembly on ocean affairs and policy guidelines for sustainable tourism. It also looked at the Barbados Programme of Action for the Sustainable Development of Small Island Developing States for the review which is to take place in the General Assembly in September 1999.

231. The Commission on Human Rights, recognizing that the driving forces of globalization can have major implications for human rights, particularly in developing countries, requested all treaty bodies, special rapporteurs, independent experts and working groups to address the impact of globalization on human rights within their respective mandates. The Subcommission on the Promotion and Protection of Human Rights was asked to submit a comprehensive study on this issue to the Commission at its next session.

232. At Headquarters, the new management arrangements and other reforms have enabled the Secretariat and other bodies to contribute more effectively to the ongoing dialogue on globalization. The Deputy Secretary-General leads a task force of senior officials which is coordinating the United Nations response to a range of globalization issues. The Executive Committee on Economic and Social Affairs has issued reports on the need for the reform of the global financial architecture and on the debt problems of developing countries. New reports are being prepared on development finance and the social dimensions of macroeconomic policy as a contribution to the debate on socio-economic questions related to globalization.

233. One of the consequences of globalization has been the reaffirmation of regional identity. Addressing regional issues and enhancing cooperation with regional institutions via the regional commissions remains central to the work of the Organization. During the past year, the regional commissions have provided the vehicle for in-depth consultations involving Governments and civil society on the agenda of the Millennium Assembly. Globalization has also become a major research focus for the regionally dispersed campuses of the United Nations University and many of the other United Nations research institutes around the world.

234. The challenges of globalization are too great for Governments and international organizations to deal with on their own. Meeting in October 1998, the Administrative Committee on Coordination placed the challenges arising from globalization and the adverse effects of the financial crisis centrally on its agenda. Following that meeting, the United Nations Development Group was requested to develop an action plan for United Nations country teams to work together with national partners in response to the challenges of globalization and the financial crisis in East Asia. Drawing on existing strategies, the plan presented a range of specific options under four broad areas of activity: (1) monitoring the impact of the crisis, particularly on vulnerable groups; (2) assisting individual countries to carry out the necessary structural and institutional reforms; (3) helping to strengthen and build basic social services and safety nets for the least fortunate; and (4) forging closer links with the World Bank.

235. At the first regular session of 1999 of the Administrative Committee on Coordination, in April, the members concluded that, to meet the challenges of globalization, the United Nations system needed to cooperate more effectively with the private sector and civil society, as well as with Governments. Cooperation can be deepened through partnerships, and it was for this reason that I proposed at Davos that the power and reach of the corporate sector be engaged to further the goals of the Organization. At the second regular session, in October 1999, the members of the Committee will endeavour to reach some overall conclusions on the capacity of the United Nations system to respond flexibly and effectively to the challenges of globalization in the next century.

236. Despite the need to involve all stakeholders in devising responses to globalization, much of the responsibility for addressing its negative consequences rests with the world's most advanced economies. That is why I wrote to the leaders of the G-8 prior to their summit in Cologne in June 1999, urging them to act to prevent the majority of the world's population being left on the margins of the global economy. I urged them to boost their own economic growth, to provide additional official development assistance and debt relief and to bring the representatives of the developing countries and economies in transition into the deliberations on a new international financial system. Although some progress has been made in these areas, far more needs to be done.

237. Progress was made at the Cologne summit on the issue of relieving the debt burden of the heavily indebted poor countries. However, financial and operational details still need to be discussed by the Ministers of Finance at the next session of the Interim Committee, and in the Economic and Social Council this year emphasis was placed on ensuring adequate financing for the full implementation of the G-7 decisions at Cologne. With regard to official development assistance the picture is bleak, however. Between 1990 and 1998, the share of GDP devoted to official development assistance in the developed economies fell from 0.33 per cent to 0.23 per cent.

238. Countries enter the global trading system from very different starting points, and globalization and liberalization affect them unevenly. There have been notable developing country successes where domestic reforms have provided increased dynamism to international trade and investment. Yet problems of access to markets, capital and technology remain pervasive, and many developing countries find it extremely difficult to make the institutional transformations necessary for a beneficial integration into the world economy. In November 1999, the third session of the Ministerial Conference of the World Trade Organization will be held at Seattle, and it now seems likely that the Conference will launch a new round of multilateral trade negotiations. In the Economic and Social Council this year, the idea of making this round into a "development round" enjoyed considerable support. A new trade and development round could provide major opportunities for developing countries to negotiate their integration into the world economic system on the basis of a positive agenda. UNDP and UNCTAD are joining forces to help developing countries to formulate negotiating positions for the Conference.