The case for the global economy

  • 21 September 1999

Globalization is today's reality. Like it or not, the move to a world economy is a fact of life. At some point in the 1990s the process achieved critical mass and people started to sit up and take notice. Many were apprehensive.

Today, almost all of us are aware that our lives are being shaped by an interconnected world economy of cross-border flows of trade, finance and technology. In our hearts, we know that there is no going back.

Trade liberalization negotiations, which until the 1990s progressed in near obscurity, capture world headlines as the century ends. Special interest groups are preparing mass protests and demonstrations to oppose the launch of a new trade round at the World Trade Organization’s ministerial meeting in Seattle in November.

An array of non governmental organizations, from environmentalists to labour unions and consumer organizations, are mounting what they are calling a “mobilization against globalization.”
The International Chamber of Commerce, representing thousands of businesses of every size and sector around the world, is convinced that the gradual emergence of a global market economy will bring enormous benefits to mankind in the 21st century.

Technology and the global market place have opened up prospects for personal advancement that were undreamed of only a few years ago. The internet provides limitless scope for forging business links and makes information instantly available. Falling transport costs are conquering distance and increasing people’s mobility. Consumers are able to buy products from all parts of the world at competitive prices.

But powerful forces who claim to represent “civil society” are determined to put the clock for a variety of motives – fear of change, suspicion of new technology, concern about the environment, economic nationalism, hostility to business.

As these web pages will demonstrate, the benefits of globalization are already apparent, reflected in increased trade, greater availability and variety of goods, higher living standards, and the transfer of technology. To quote the economist Keith Marsden, writing in The Wall Street Journal: “The human condition has improved in almost all nations over the past two decades.”

Or as The Economist puts it, in a perceptive survey of the 20th century in its 27 September edition: “The replacement of central planning by market-based economies and a general lowering of trade barriers have begun to lift millions of people around the world out of poverty, given them more income, more education and more freedom of choice.”

That is why ICC has always supported trade liberalization and has expressly called on governments to set ambitious objectives for the “Millennium Round” of trade negociations, which should be completed by a strict three-year deadline.

But this does not mean that we shrug off the costs and risks of globalization – the volatility of financial flows, the uncertainties associated with more rapid economic and social change, the spread of cross-border crime, and in particular crimes that exploit the Internet.

ICC accepts that, just as democracy needs rules in order to function well, so does the global economy. The challenge is to find the right balance between rules and freedom. Business is seeking solutions, for example through ICC recommendations on best practices in risk management, on reducing the threat to financial stability posed by “hot money”, and through our new special unit set up within Commercial Crime Services in London to deal with cybercrime.

Now we intend to present the case for the global economy, and how business is facing up to its challenges, on a special section of the ICC web site. We shall include our own statements as well as references to relevant articles and quotations that have been published elsewhere.

Our editors welcome outside contributions. Sometimes, we shall provide full texts, at others we will provide extracts, summaries and quotations. We shall be grateful to learn of suitable articles for inclusion and to receive suggestions for the site’s improvement.