Summary

 

The Bridging Global Gaps (BGG) 2003 Conference was the seventh annual conference organized by the Forum 2000 Foundation. Under the auspices of Václav Havel, this and other events have provided an open and neutral space, where a dialogue that seeks a deeper and more thorough analysis of the current nature of global concerns can take place. In 2002 the Foundation decided to launch the BGG project with an aim to facilitating this dialogue between representatives of different and often conflicting views regarding current globalization processes.

Workshop participants included: Frederik W. de Klerk (former President of South Africa); Eveline Herfkens (UN secretary-general's executive coordinator for the Millennium Development Goals Campaign); Joshua Karliner (former executive director of CorpWatch); Michael Klein (vice president of the World Bank, chief economist of International Finance Corporation); Lord Holme of Cheltenham (former chairman of the Commission on Environment, International Chamber of Commerce); Thomas Dawson (director of External Relations Department, International Monetary Fund); Deborah Doane (programme director, Transforming Markets, New Economics Foundation); Davison Mulela (deputy foreign minister, Zambia); and other distinguished representatives of international organizations, businesses, governments and NGOs.

This is a summarised analysis of opinions and positions presented at the 2003 Conference. Further details will be available at www.forum2000.cz. The BGG Conference featured four workshop discussions based on position papers, and moderated with a view to producing a brief report. These workshop reports, also available at the Forum 2000 website, summarised the issues, areas of agreement and disagreement, and suggested ways for improvement. The Conference Analysis reframes the four thematic issues and attempts to identify potential barriers to change, and conditions conducive to the bridging of global gaps. Two days of participants' discussions showed that the steps necessary for the resolution of global problems require both rethinking of global governance, and increased attention paid to the problem-solving process.

Rethinking governance regimes

1) International Trade

Despite the failure of Cancún WTO Ministerial, there was a clear consensus in calling for the re-start of multilateral negotiations. However, the current system includes unfair rules and double standards. Views differed on whether the Doha Round should get back on track, or if the entire WTO process needs a major shake-up. The main responsibility in restarting the negotiations lies with the EU and the USA. More responsible national policies should go hand in hand with more democratic processes of trade rule-setting and decision-making. It was agreed that trade regimes, especially in agriculture, need to go beyond free trade towards fairer trade.

Fairer trade policy should be open, measured and responsible. Richer countries were urged to provide market access to poorer countries, many of which depend on export revenues. There should be a differentiation between good and bad subsidies: domestic support for rural development might qualify as a good subsidy, but all bad (e.g. export) subsidies must be stopped entirely. A responsible trade policy ought not to conceal dumping or protectionism under the guise of better sanitary standards or tariffs escalated for the import of processed goods. Disagreement centered around the role of large-scale production, and the feasibility of international commodity price control.

2) Debt Relief

Iraqi debt relief sparked off a broader discussion of international insolvency and financial governance. It was agreed that attention has traditionally been focused on the ability to pay, rather than on the legitimacy of the debt, or even on who decides about these issues. If odious debts - incurred due to creditor negligence and misuse by undemocratic regimes - are legitimized, the risk of moral hazard increases, eventually forcing taxpayers to pay the bill. Some countries were caught between the conflicting positions of debt sustainability and sustainable development. There was wide agreement that better financial transparency, and increased responsibility in lending by both official and private creditors´ must be ensured. In addition, conditionality needs to be rethought. It was stressed that functioning health and education services, as well as good governance and good investment, are conducive to sustainable development; countries should not be pushed to privatize basic services, nor should the strive for macroeconomic stability undermine efficient expenditures in social sectors.

Interpretations of the Highly Indebted Poor Countries Initiative (HIPC) for official debt relief and proposals for commercial debt resolution differed. However, there was an agreement that poor countries need more and better debt relief. The mechanism should be comprehensive, transparent and rule-based. Criteria should focus on poverty reduction and on the Millenium Development Goals. Key stakeholders should participate in both design and decision-making. The governance of international financial institutions, and the conflicts inherent to the role of IFIs as expert, lender and decision-maker were agreed to be one of the more important issues. Despite disagreement about the sources of additional funding, particular mechanisms and whether the IMF should be responsible for it, debt relief should occur neither at the expense of aid, nor at the expense of the needs of less indebted countries.

3) Regulation and corporate social responsibility

Regulation and corporate social responsibility were among the most contentious issues. Participants agreed that voluntarism and self-correction are not sufficient. Responsibility has to be matched by enforceable accountability. On the other hand, positive language stressing opportunities as well as responsibilities, can stimulate emergence of new business leaders and models based on concepts such as the triple bottom line, integrated responsibility and sustainable development. Competition and efforts to ensure internal as well as external legitimacy of business must complement regulatory mechanisms.

The cracked legitimacy of economic globalization has more extensive roots. Increased transparency of all actors needs to be reinforced by tackling corruption, campaign financing and power imbalances. The good reputation of NGOs helps to open new political channels. However, there was strong agreement that a "mixed ecology" of complementary and differentiated regulatory instruments will not occur without government involvement. No substantive change in corporate behavior can be expected without redefining the current economic paradigm and democratic transnational governance.

4) Global public goods

The discussion on global public goods (GPG) helped to shed new light on trade, debt and regulation issues, and provided a useful framework for the whole conference. There was little doubt that global public goods such as the environment, prevention of communicable diseases, security or financial sector stability can be efficiently provided either by the market mechanism, or by isolated governments on a purely national level. Even provision of private goods such as safe water was seen as a top international priority. But international cooperation alone - its mechanisms, costs and obstacles - also ranked very high among primary issues of global concern.

Various proposals for financing and more efficient provision of these GPGs were voiced. An effective international forum was sought after, or a set of formal and informal forums. Participants agreed on the need for an international forum -- multilateral, non-exclusionary and transparent - that would serve as a platform for communication (and consensus-building) for the GPG. It was agreed that rich countries should pick up a large part of the bill. The costs of inaction regarding global problems are increasing. Corrective and preventive action is often not only cheaper, but in the very interest of the rich. The bulk of attention, however, was devoted to where and by whom GPGs are being decided. Current international decision-making structures like the G7, the Bretton Woods institutions or the UN Security Council suffer from a democratic deficit.

The Bridging Process

Fairer trade, enhanced debt relief, effective regulation and improved provision of global public goods constitute elements of sustainable development. What we do for development, however, was considered as important as how we do it. In short, it was agreed that the process of development cannot be separated from the development of a process. After all, democratic procedures and respect for basic values such as accountability or transparency lie at heart of any system of good governance.

Although participants agreed that primary responsibility for development dwells with the people in the poor countries, they can hardly be expected to manage globalization. Only comprehensive, integrated solutions can work in our interdependent world. Better governance amongst underdeveloped countries is hard to achieve without legitimate governance in developed countries, and without proper global governance. Based on conference discussions, six obstacles could be identified that hinder the implementation of new concepts or existing national mechanisms, and prevent better global governance:

Big picture

According to many participants, the current economic model is obsolete. It needs to be rethought and integrated into a wider societal context and given a longer time frame. Social, human and natural capital need to be introduced into economic accounting.

Tied hands

Shrinking policy space ties the hands of governments. Rich country politicians need to please voters as well as businesses. Poor countries are trapped in their dependency on external capital and domestic culture. But people increasingly depend for their needs on interlinked markets, dominated largely by corporations.

Collective (in)action

Complex, unprecedented global problems require effective collective action and social capital for their resolution. Yet democratic deficit, inadequate accountability and the heterogenous priorities of national governments seem to diminish the capacity to change the situation for those stakeholders who need that change the most.

Lack of courage and leadership

Civil society has mobilized the public and raised awareness regarding these gaps. Whilst a growing number of people recognize them, only a handful of leaders in business and government are finding the courage to stand up to the challenge.

Vested interests

Democratic representation suffers when money interferes with voting and when big business is too heavily aligned with big politics. Campaign financing and the influence of business on political agendas often distorts national and global public concerns.

Power imbalances

The power of corporations and rich countries leads to an uneven implementation of policy and double standards in international negotiations and the very design of global rules. Most NGOs, smaller countries and poorer people cannot compete in the international political market.

Many actors within globalization recognize these gaps and are in command of a vision to do something about them, but very few possess the viable strategy needed to realize a better world. The BGG project hopes to speed up a shift in the global paradigm by tackling the obstacles to political and economic change, encouraging a more democratic process in global decision-making, and extending the community of global "bridgers" as well as the pool of their strategies for transition. The Forum 2000 Foundation continues to host these dialogues in the spirit of Prague's philosophical and intellectual tradition.

Workshop Outcomes

Workshop 1: Trade and Agriculture: Current Debates and Controversies

"The current system of global economic governance needs to be fundamentally reformed. Double standards in international trade must be eradicated and a fair playing field for all must be ensured." This was the conclusion of last year's Forum 2000: Bridging Global Gaps Conference (BGG), at the workshop addressing international trade and finance. There was agreement regarding the general direction required for the necessary reforms, including democratization and empowerment of multilateral institutions and improved coherence of their policies. This year's BGG conference, which takes place approximately one month after the ministerial summit of the World Trade Organization in Cancún, will provide an ideal opportunity to reflect upon its collapse and upon the future of the multilateral trade framework. The key questions to be discussed are: Does the collapse of the WTO summit in Cancún mark the end of the whole multilateral trading system and the return of the world where might is the only right? Or does the re-emergence of the Third World as a coordinated political force bring a new hope for creating a "fair playing field" in international trade? Are the demands of the G-22 alliance the right steps toward the fair playing field for trade in agriculture as envisaged by last year's participants in BGG? How free and how global should "fair trade" in agriculture be and how much of it should there be? How can fair prices for farmers' products be ensured?

Moderated by: Frederik Willem de Klerk, former president, Republic of South Africa

 

Coordinated by: Martin Konečný, Masaryk University, Brno

 

Panellists:

Kenneth Ash, deputy director, Directorate for Food, Agriculture and Fisheries, OECD

Mamadou Cissokho, Senegalese farmer, honorary president of CNCR

Rian Fokker, spokesperson of NOVIB (Oxfam Netherlands)

Eveline Herfkens, UN secretary-general's executive coordinator for the Millennium Development Goals Campaign

Marco Quinones, programme director, Sasakawa Africa Association

Francisco Thompson-Flôres, deputy director-general, WTO

Alberto Villareal, Friends of the Earth International, Uruguay

1) Multilateral Trade Negotiations after Cancún

Areas of agreement

• All of us agree that multilateralism in trade negotiations is the best way forward, and that the failure to reach an agreement in Cancún may result in putting too much emphasis on bilateralism.

• We agree that the multilateral negotiation process in the WTO should be re-started as soon as possible. We call upon the EU and the USA to join the genuine effort to revive the negotiation process. We ask the director-general of the WTO to establish direct contacts between the representatives of developing countries, the EU and the USA in order to reconstruct the negotiation process.

• The four Singapore issues should not be allowed to pre-empt meaningful negotiations on agriculture.

• The problems of trade cannot be solved in isolation from other global issues, especially debt, foreign direct investment and exchange rate fluctuations. It would be a futile exercise to rectify the trade rules especially if the unsustainable debt payments by the developing countries continue. We, therefore, ask all the relevant international economic institutions and national governments to co-operate in dealing with all these issues.

Areas of disagreement

• Some of us consider Cancún a "big disaster" for developing countries, others consider it a "big victory" for developing countries.

• All of us agreed that a multilateral negotiation process should be re-started. For some, this means that the Doha Round should just get back on track and go on. For others, the Doha Round itself and even the whole WTO trade liberalization process have been flawed from the beginning and need a fundamental shake-up that will ensure more transparency in the negotiation process.

2) The G-22 Alliance and its Demands

Areas of agreement

• We welcome the emergence of new coalitions of developing countries as a positive development that can enable the multilateral process to commence.

• We encourage the EU and the USA to enter into a multilateral dialogue with the representatives of developing countries and avoid the "divide and rule" strategy.

• Simultaneously we urge the leaders of what has been called the G-22 coalition to actively pursue multilateral negotiations in a way that will accommodate the needs of all their members. The more developed G-22 countries should also play an active role in reaching out to the least developed countries and to the smallholding farmers.

3) How Free Should Trade Be to Be Fair?

Areas of agreement

• All of us agree that dumping of subsidized products on foreign markets must be stopped.

• We agree that completely free trade in agriculture is not feasible, but we do need more free trade on the part of the rich nations. Production and export subsidies must be cut and more market access must be ensured by the immediate lowering of trade barriers, especially the escalated tariffs for processed products.

• We agree that it is necessary to distinguish between different kinds of developing countries with different needs (e.g. underdeveloped versus newly industrialized countries). Differentiated trade rules rather than one-size-fits-all solutions are necessary. The priority for developing countries is more market access, while for some of them it is also more protection of their domestic products.

• Developing countries need not only more market access but, in order to reap its benefits, they also need much more state investment into developing their domestic agriculture, increasing productivity, improving the quality of products, and into environmentally sustainable rural development.

• There should be a differentiation between good and bad subsidies. We need to redefine "trade-distorting subsidies" with better criteria. Bad subsidies are all subsidies that encourage overproduction and dumping, including many subsidies that are today considered as "less or minimally trade-distorting." Investment into human resource development, skill training of farmers, health and safety, developing agriculture marketing information systems, research and development and nature protection is not trade-distorting and should be encouraged.

• We are all concerned that the misuse of health and safety standards can act as a new protectionism in disguise that can wipe out all that is achieved in market access through tariff reduction.

Areas of disagreement

• Some of us put the emphasis on agricultural products as tradeable commodities, while others stress the human rights dimension of food.

• We all agree that small farmers should be encouraged and helped to become more effective. Some of us feel that at the same time self-subsistence farmers should be encouraged and helped to move from subsistence to commercial agriculture. Others believe that self-subsistence farming should be sustained.

4) How Can Fair Prices for Agricultural Commodities Be Ensured?

Areas of agreement

• We all agree that price stabilization is a good goal. A major solution to the falling commodity prices is to end overproduction in the rich countries by cutting the production subsidies.

• We also agree that this is not a sufficient answer to ending oversupply.

Areas of disagreement

• We differ on the role supply-management schemes could play.

• We also differ on the role played by the big agricultural business in depressing the world commodity prices.

Workshop 2: Transnational Corporations: Sustainability, Accountability and Partnership

In 2002, at the Forum 2000: Bridging Global Gaps Conference, different strategies for translating desired values into concrete steps in corporate behavior were thoroughly debated. Participants in the workshop Ethics, Accountability and Sustainability in the World of Transnational Corporations jointly concluded that, "a concentrated strategy to implement the goals of accountability, transparency and environmental protection under the same umbrella in a UN-structured framework needs to be established." Whilst increasing numbers of corporations welcome the concept of sustainable development as a means of achieving both shareholder value and social and environmental change, NGOs often argue that there is a lack of tangible results. Today, multi-stakeholders' partnerships, good governance, voluntary self-regulation and corporate social responsibility (CSR) codes are on the top of the agenda for corporations facing the challenges of globalization. Are these internal strategies effective in achieving the desired level of change and reflecting the "triple bottom line" of profit, social responsibility and sustainable development? What should be done in order to make them work better? Or are critics from NGOs and civil society correct when they stress the importance of "outside" approaches, involving the external regulation of corporate activities at local, national and international levels? Are synthetic approaches that provide external evaluation of adherence to voluntary codes, such as the Global Reporting Initiative, effective and desired? How, given these differing agendas, can multi-stakeholder partnerships evolve and operate in order to meet the pressing needs of today?

Moderated by: Tom Spencer, executive director, European Center for Public Affairs, UK

 

Coordinated by: Colm O'Cinneide, Faculty of Law, University College London

 

Panellists:

William Bourdon, lawyer, Association Sherpa; former general secretary of the International Federation of Human Rights Leagues

Deborah Doane, programme director, Transforming Markets, New Economics Foundation

Lord Holme of Cheltenham, former chairman of the Commission on Environment, International Chamber of Commerce

Erik Jonnaert, director, Corporate External Relations Europe, Middle East and Africa, Procter & Gamble

Joshua Karliner, former executive director of Corp Watch

Michael Klein, vice president of the World Bank, and chief economist of International Finance Corporation

Heinz Rothermund, former managing director of Shell Exploration and Production International

Matti Wuori, Member of European Parliament; former head of Greenpeace International

Peoceedings of the Workshop

• We engaged in a vigorous exchange of views as individuals, while remaining sensitive to the degree to which we were accountable to our organisations.

• We reviewed the extent to which the world has moved on since last year's debate at Forum 2000: Bridging Global Gaps Conference, and believe that debate on corporate accountability and responsibility should not be divorced from the overall global context and the other issues being addressed by the Forum 2000. These issues should be addressed as a matter of urgency.

• We recognised that questions of accountability, transparency and legitimacy are complex. In certain areas the debate between civil society and business has become more polarised but in other areas some progress has to be made. However, these issues had to be dealt with as a matter of serious urgency.

• We recognised that the discussions were inevitably limited by the composition of our group, and concluded that there was a need to widen the debate to include other key parties.

This Year’s Discussion

Some panellists felt that a new positive corporate focus on sustainable development is emerging as part of a new business model. Others identified a greater interest on the part of corporations in developing a balance between sustainability and profit.

Others in turn emphasised what they saw as opportunities to develop international legal remedies to cope with the supranational status of TNCs and their impact upon human rights, the environment and democratic accountability. Many also viewed as crucial the development of the capacity of civil society to assure corporate accountability.

There was a general acceptance that the role of governments needs to be strengthened. NGO accountability also was felt by some to raise issues, but others considered that this was generally secured by existing legal requirements, and the nature of the work of NGOs.

The need for greater governmental involvement to drive the sustainable development agenda involving both regulation and voluntary action was commonly agreed upon. Some expressed doubts regarding the ability of governments to create such a framework given the nature of some national political systems. Some also felt that corporations or other interest groups should not be financing political parties and electoral politics, and their lobbying practices should be transparent. Others disagreed.

Continuing the Debate

Participants considered that:

• There is a need for this debate to be anchored in the broader debate concerning the creation of a broader global value system. Concepts of responsibility and accountability, and to whom it is owed, need to be developed to a greater extent than hitherto. NGOs and business both have a positive role to play in this process. However, governments also need to be much more active at the national and international levels than they have been so far in fulfilling their responsibilities to provide a framework for all three sets of actors to work together to achieve progress towards the Millennium Development Goals.

• Accountability, legitimacy and transparency are key goals. Some form of mixed public policy framework designed to ensure progress towards achieving these goals is necessary, which will incorporate a combination of regulatory and voluntary approaches, with an international dimension. Key questions in developing this framework are how to balance legal and voluntary approaches; how to ensure that excessively mechanistic regulation would not hinder the development of flexible methods of integrated responsibility within corporations; and how to ensure that real, tangible progress is achieved, and that rhetoric does not substitute for actual achievement?

• What is the future role of multilateral institutions in this process and the current political context? The role of the UN will be important, especially given the UN Sub-Commission recommendations on corporate accountability, but the roles of other international institutions also have to be considered.

• Transparency as to lobbying and finance in respect of how NGOs, corporations and governments interact is also crucial.

Workshop 3: External Debt: Issues of Sustainability and Legitimacy

The over-indebtedness of poor countries is not only related to economic and legal questions. It also relates to political decisions and the various stakeholders' political responsibilities. Often, political interests of the bipolar world were decisive in loan decisions, and their productivity has correspondingly been low. A broad range of states, which have undergone fragile democratization processes, are facing these old liabilities that tend to de-stabilize the new order, while creditors often turn their backs on them. Critiques of such behavior have long argued that these debts are odious and should not be repaid. Iraq is a current example of a situation when political interests are calling into question existing mechanisms for dealing with foreign debt. These interests are pushing for a faster solution to the indebtedness problem, which leads one to ask if Iraq is setting a precedence for other cases? How can odious debts be identified and dealt with? Participants of this workshop will also discuss the existing and emerging frameworks for debt restructuring and will try to explore the ways to make the debt negotiations more transparent and accountable to the public.

Moderated by: Jürgen Kaiser, national coordinator, Jubilee 2000, Germany

 

Coordinated by: Jan Štěpán, University of Economics, Prague

 

Panellists:

Patricia Adams, executive director, Probe International, Canada

Catherine Barber, economic policy adviser for Oxfam Great Britain

Thomas Dawson, director of External Relations Department, International Monetary Fund

Francis Lemoine, senior policy analyst, EURODAD, Belgium

Jana Matesová, senior advisor to executive director, World Bank

Davison Mulela, deputy foreign minister, Zambia

Current State of the Problem

The question of legitimacy of claims on southern countries is normally ignored when a sustainable level of debt is determined. Such a practice legitimizes such debt and will cause lenders to behave irresponsibly again in the future. Iraq, with a total debt of approximately 380 billion US dollars and a GNP of 25 billion, is a star case of not just an unsustainable burden, but also of highly questionable claims by creditors who financed the dictator's military build-up and affluent lifestyle.

As it is clear that financial crises will be reoccurring in the middle-income countries, the need for a comprehensive workout mechanism for unsustainable foreign debt is undeniable. However, the Sovereign Debt Restructuring Mechanism proposal didn't receive the necessary supermajority of 85% to be approved by the member states of the IMF. Even though 70% of the IMF constituency wanted to continue discussing the mechanism on the grounds of the IMF, the position of USA has shelved the proposal.

The HIPC initiative, although it has been a step forward in providing a framework for debt relief, didn't fulfil the initial goals and has to face a reform in the near future.

The Millennium Development Goals cannot be reached without having more resources available via debt relief and additional aid.

Areas of agreement

• It is desirable and necessary to include the issue of legitimacy in standard procedures in international debt management.

• If democracies were lending irresponsibly to illegitimate governments, the taxpayers should assume the burden of such mismanagement. However, in cases where the lending government cannot be considered legitimate itself, a new standard of accountability needs to be established.

• If a more representative voting structure cannot be found in the IMF, an alternative approach (like the NGO proposal for a Fair and Transparent Arbitration Process) has to be found.

• Code of conduct that would not legally bind the creditors into a debt-workout cannot be the basis of a debt-restructuring framework.

• Accountability of the creditors needs to be ensured:

- Bilateral donors (ie. governments of the developed states) should be held accountable through the pressure of the taxpayers who would in effect pay for irresponsible behavior of their governments.

- Odious (ie. illegitimate) Debt Doctrine is a promising concept, which may be used in some cases to put responsibility on the shoulders of the creditors. To ensure the accountability of both the creditors and debtors, lending must be transparent.

• HIPC 2 initiative is definitely not sufficient to provide necessary debt relief for poor countries.

• The current definition of debt sustainability has to be redesigned and must include a broader range of use from non-creditor institutions to reflect better the real impact of debt cancellation on poverty reduction. The definition must explicitly take into account the resource needs for reaching the MDGs.

Areas of disagreement

• Whether the Odious Debts Doctrine can be applied given the critical issues of implementation.

• In what form the multilateral lenders (IMF/WB) should be financially responsible for their mistakes or even culpable for them.

• Whether it is feasible at all to approve and implement a worldwide insolvency framework or restructuring mechanism outside of the Bretton-Woods institutions and whether such agreement could be enforceable.

• Whether additional international financial institutions' write-offs could be financed out of institutional reserves without endangering their short-term financial standing.

Recommendations

The legitimacy of debts inherited from oppressive regimes has to be evaluated and governments should cooperate in providing all the necessary documentation to both official and independent assessors.

• To ensure transparency, accountability and to have a better picture of the legitimacy of debts, independent forensic auditing should be used as much as possible to assess the validity of debts.

• All market participants as well as civil society should be encouraged to work on further proposals regarding an independent debt workout mechanism which would comply with the rule of law.

• For the imminent case of Iraq's foreign debt it is recommended that

- Under a public and transparent process external debts are assessed for their validity and legitimacy before any debt servicing is resumed.

- A political initiative is taken to organize a comprehensive debt conference after the donor conference, taking place next week in Madrid, which would include all stakeholders, particularly Iraqi civil society groups.

• HIPC 2 is redesigned so that

- more countries are involved,

- more flexibility in the application of conditionalities and evaluation of country performance for the countries that go off track are applied,

- higher debt relief is provided.

If it doesn't deliver after that, then it needs to be substituted by a new framework.

• Civil society as well as the international institutions have to increase pressure on the governments of the developed north in order to make them comply with their previous pledges, in particular the MDGs and the Monterrey Consensus. This includes an increase in the amount of aid and the assessment of debt sustainability, which explicitly takes into account the amount of resources needed to achieve the MDGs.

• More consideration must be given to assessing the most efficient use of additional resources. Particularly, the trade-off is between debt relief and other forms of financing and assistance.

Workshop 4: Global Public Goods: Ambitious Approach or Impossible Ideal?

Global Public Goods (GPG) are goods, services or conditions that benefit people anywhere in the world. They include issues which range as broadly as peace and security, biodiversity, alleviation of HIV/AIDS pandemics, and financial stability. In 2001, the Prague Declaration adopted by the participants of the Forum 2000 conferences stated that, "[the] challenge of global democracy is one of finding instruments and institutions that will equally protect globally shared values and local differences." The GPG also stands for a concept of global governance or, as it were, managing globalization. To guarantee provision and financing of GPG, global policies need to be created that would effectively frame and regulate globalization through coordination of national policies, international treaties and organizations, or global taxation and market creation. The participants in the workshop will first examine common notions like "public" and "private," and then discuss the pros and cons of institutional arrangements, operational policies and financing mechanisms for the provision of global public goods.

Moderated by: Lord Desai Of St Clement Danes, director, Centre for the Study of Global Governance, London School of Economics

 

Coordinated by: Gavan Titley, Renvall Institute, Helsinki

 

Panellists:

Debi Barker, executive director, International Forum on Globalization

Shih-meng Chen, president of the Ketagalan Institute; former deputy governor of the Central Bank of Taiwan

Inge Kaul, director of the Office of Development Studies at the UNDP

Björn Lomborg, associate professor of statistics in the Department of Political Science at the University of Aarhus, Denmark

Jana Matesová, senior advisor to executive director, World Bank

Rémi Parmentier, former political director of Greenpeace International and director of The Varga Group

Current State of Issues

• Global Public Goods (GPG), while an emerging and disputed concept, were approached as goods central to the well-being of everybody that cannot be efficiently provided for by market processes and national policies alone.

• Under current conditions of globalisation, people and finance are mobile, spreading volatility and the crucial recognition that problems transcend the boundaries and collectivities of nation-states. The recent SARS crisis emphasises that well-being must be protected and enhanced globally.

• At present, the current distribution of costs and benefits in dealing with both global goods and bads is inefficient and inequitable. The costs of inaction are at least as serious as the costs of corrective action.

• GPG as a concept aims to re-frame existing problems and to redirect resources in order to persuade stakeholders to pay due attention to provision and access to public goods while preventing public bads.

Areas of agreement

• The workshop panellists agreed that there is a need for a forum - that is inclusive of all stakeholders - to research and formulate priorities for concerted action on GPG. This broadly multilateral body will have the function of persuading stakeholders of the benefits of a global public goods approach and providing consensus-building mechanisms.

• A range of ways in which the financing of GPG could work was examined (national taxes, international taxes such as the Tobin tax, new property rights, private finance streams). While there was no agreement on suggestions for GPG financing, there was consensus that GPGs involve redistribution from rich to poor, while emphasising that re-structuring the incidence of costs is beneficial to all sides.

• The workshop panellists suggested a list of priority GPGs that should be addressed based on the research and validation of the proposed forum. In relation to the inclusive character of this forum, it was emphasised that priorities are always suggestive, and need to be negotiated in relation to the different needs and priorities of developed and developing countries.

These priorities are:

• Clean drinking water. While the panel disagreed over the nature and type of systems of provision, as well as the mixed private/public nature of water, this priority was based on the ongoing basic lack of access to clean water, and emerging global tensions surrounding water as a resource.

• Global health issues, for example TB, Malaria and HIV/AIDS.

• Global environmental challenges, such as climate stability and high-seas biodiversity.

• Financial stability. This was understood as controlling excessive financial risk in order to prevent crises, rather than limiting the volatility of competitive markets. The consequences of financial crises are felt in rich and poor countries, and it is accepted on national levels that competitive, liberalised markets require regulation.

• In order to intervene in these bads and secure GPGs, we need efficient dissemination and application of existing knowledge. While recognising the importance of intellectual property rights, we need flexibility in the current intellectual property regime to complement tackling problems and sharing benefits. This was particularly discussed in relation to current health crises and the TRIPPS agreement, but the debate is relevant to all of the priorities listed here.

Areas of disagreement

• While no major areas of disagreement emerged, there were intensive discussions on the priorities, the modalities of financing GPGs, and appropriate and possible loci of decision-making.

• The participants disagreed on the exact nature of the proposed body and did not critique in depth existing proposals. Suggestions included the G-29 body within a reformed UN General Assembly, an independent NGO, or a body with significant relations to the G-8 as potential funders.

Recommendations and steps to be taken

• The main recommendation of this workshop is the setting up of a forum for establishing GPG priorities in relation to the ongoing research and professional communities. A further function of this forum would be to identify where gaps exist in the present institutional structures and initiatives. Each priority issue may require a different process of participation, consultation, research and financing.

• The workshop called on policy-makers, citizens, businesses and civil society to recognise that GPGs are central to the well-being of everybody, and that significant awareness-raising is crucial to re-direct existing resources in a more efficient direction.