Making Globalization Work for the Poor

The Swedish Presidency of the Council of the European Union arranged an informal high-level consultation in Kramfors, Sweden on 20 -21 June 2001 to consider how Europe can contribute towards making globalization work for the poor.

Main conclusions from the consultation:

1. 
   
2. Globalization is a multidimensional and complex process that involves both opportunities and risks. The growing intensity of worldwide interconnectedness has brought development prospects of unprecedented magnitude. Globalization has the potential to contribute to poverty reduction and the achievement of the Millennium International Development Goals. If globalization cannot be made to work for the poor we will all suffer the consequences - for world peace, for development and for social justice.
   
3. The European Union is a global actor possessing the instruments and ability to help improve the lives of people far beyond the borders of Europe. The EU is the single biggest market for poor countries, it provides more than 50 percent of global development assistance. The EU has a long democratic tradition, and given its history and long experience in regional co-operation, it has the responsibility and unique potential to play a leading role in ensuring that globalization works for the poor.
   
4. Coherence begins at home. Decisions by the EU in policy areas other than development co-operation such as trade, fisheries and agriculture, have a huge impact on developing countries. The need for coherence of these policies with development objectives is enshrined in the Treaty of the European Communities. We need to ensure that this commitment is fulfilled.
   
5. The International Conference on Financing for Development in Mexico 2002 will provide an important opportunity to set out strategic goals for policy coherence. The EU advocates an outcome that comprises all key national and international, private and public actors in order to contribute to Financing for Development.
   
6. The efforts of the Secretary General of the OECD to address coherence in all policy areas that affect developing countries should be strongly encouraged in the context of poverty reduction.
   
7. Globalization has important potential consequences for the democratic process and the construction of more inclusive and responsive governance, within and beyond the state. EU needs to address the increasing inequality in the world and recognize the political dimension of development.
   
8. While we must see to it that markets function well, a coherent policy for global development must include decisive measures to secure provision of the public benefits and services that markets are unable to provide.
   
9. In the international governance system there is a coherence deficit, a democratic deficit and a compliance deficit, which must be addressed. A more democratic and accountable system of global governance is a necessary condition for the realization of global social justice. The EU should become fully involved and invest in efforts to improve global governance.
   
10. It is of utmost importance to strengthen global and regional institutions since globalization is constraining the role of sovereign nations to direct and control economic and social activities. These institutions will be critical for promoting and developing frameworks for norm setting, rules, guidance, decision-making and enforcement based on common values regarding democracy, human rights, equity, gender equality and open markets. At the same time globalization is changing and increasing the role of national and local governments.
    
11. The European Union should help enhance the ability of poor countries to take a more active part in the international dialog and negotiations. This is crucial to enable developing countries to make better use of current opportunities to make their voices heard. Existing institutions should also be reformed to become more inclusive and responsive to their needs.
    
12. EU-efforts to strengthen democracy, compliance with universal human rights and strategies for sustainable development should be based on a respect of the socio-cultural context of partner countries and their need to assert cultural identity and self-esteem. This can also empower people to shape their own lives and to benefit from globalization.
    
13. An open and rules-based international trading system is critical for development and poverty reduction. It must be part of a coherent broad based agenda including good governance, a social protection policy and human resources development. It is the obligation of the EU to support the integration of developing countries into world trade and the multilateral trading system on terms that take their special needs into account.
    
14. The majority of poor people live in rural areas and depend on agriculture. National and international development resources must be focused on broad based dynamic growth in the agricultural sector. Access to international markets is a driving force. However, subsidies in the OECD countries form a major obstacle for potential export earnings. It is important that other specific regulations, such as food standards, are designed in a manner that avoids trade distortion.
    
15. While many impediments to exports from the poorest countries are domestic, the OECD countries must open their markets. One initial, important step has been taken by the Everything But Arms initiative. This is not enough. The next steps are to review the remaining trade barriers and to reform the Common Agricultural Policy in ways that benefit all developing countries.
    
16. Moreover, EU must strive to ensure that a real "Development Round" will be launched at the 4th WTO ministerial meeting in Doha in November. The interests and concerns of developing countries should be placed at the core of the negotiations.
    
17. The European Union must also live up to its commitments regarding technical assistance in the field of trade related matters. The WTO should be allocated necessary resources for its work on capacity building in developing countries.
    
18. Regional economic co-operation could play a critical role for the integration of developing countries into the world economy and for poverty reduction. It is essential that the economic partnership agreements to be negotiated under the Cotonou Agreement serve this purpose and avoid trade divertive effects.
    
19. Violent conflict and poverty are mutually reinforcing. Violent conflicts are severe obstacles to development. The main responsibility for preventing and resolving violent conflicts rests with the parties concerned. However, the international community has a responsibility to enable and support these initiatives. Therefore EU member states should develop national action plans to increase their capabilities for conflict prevention, in accordance with the European Programme for the Prevention of Violent Conflicts, agreed in Göteborg on June15-16.
    
20. The continuing spread of the devastating disease of HIV/AIDS must be stopped. Additional resources are required for prevention and treatment including through easier access to affordable medicines. The European Community and the Member States should explore how to best support the HIV/AIDS and Health Fund proposed by the UN Secretary General.
    
21. Information and Communication Technology (ICT) is a powerful tool for development and growth and for mobilizing the capacities of poor people. ICT should be part of developing countries' national poverty reduction strategies as well as integrated into European development programmes. To this end EU should develop a strategy.
    
22. The EU needs to improve the quality and effectiveness of its development cooperation. The recommendation by DAC to untie aid to the Least Developed Countries should be implemented to its full extent. The next step should be to untie technical assistance.
    
23. Serious efforts concerning poverty eradication, alleviation of debt and improving global governance require further financial resources. Given that and the decrease in global development assistance, Europe should emphasize the need to achieve the 0.7 % of GNP target even more strongly. The current efforts among several EU members to increase their ODA and the ongoing reform of EC assistance form positive signs in that direction.
    
24. Improved co-operation between multilateral and international actors is needed if we are to achieve the Millennium International Development Goals. The European Union should, in particular, strengthen its co-operation with the United Nations and the International Financial Institutions.
    
25. Finally, efforts to make globalization work for the poor need true and long-term partnerships, based on a core of shared values, common objectives and reciprocal commitments.

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• EU Presidency Statement - Globalization and interdependence (1/11/2002)
• EU Presidency Statement - Globalization (21/9/2001)
• EU Presidency Statement - The EU, the UN and the Challenges of Globalization (21/3/2001)