Economic Forum Message
Annan, United Nations Secretary General
New York, 4 February 2002
good to be back in New York, and to find all of you here.
in the dark days of last September, I was confident that this great city would
soon recover its traditional verve and vibrancy.
I am so glad that Klaus Schwab shared my confidence – and your presence
here this weekend shows that we were both right.
message to you is still the same as it was in Davos last year, and even three
years ago. But I believe it has
gained greater urgency.
months ago, I had the honour to deliver the Nobel Lecture in Oslo.
I began by asking my audience to imagine what life is like, and what it
holds in store, for a girl
born in today’s Afghanistan - though I might equally well have mentioned a
baby boy or girl in Sierra Leone, or in the poorest parts of almost any
reminded them that the life of that girl, and of hundreds of millions of her
contemporaries, would be living under conditions that many of them in that
audience would consider inhuman.
that was true for that audience, it is surely even more so for you here today.
no one in this hall feels as rich, or as powerful and influential, as he or she
is perceived to be by others. And
yet I believe all of you – whether you are business leaders, political leaders
or opinion leaders – know well that you are enormously privileged, compared to
the great majority of your fellow human beings, both in your standard of living
and in the power and influence that you wield.
all know that you are sharing this small planet with well over a billion people
who are denied the very minimum requirements of human dignity, and with 4 or 5
billion whose choices in life are narrow indeed compared to yours.
In fact the planet seems to many of us more and more like a small boat
driven by a fierce gale through dark and uncharted waters, with more and more
people crowded on board, hoping desperately to survive.
of us, I suggest, can afford to ignore the condition of our fellow passengers on
this little boat. If
they are sick, all of us risk infection. And
if they are angry, all of us can easily get hurt.
problem is one of reality multiplied by perception.
reality is that power and wealth in this world are very, very unequally shared,
and that far too many people are condemned to lives of extreme poverty and
perception, among many, is that this is the fault of globalization, and that
globalization is driven by a global elite, composed of -or at least, represented
by - the people who attend this gathering.
perception is not universal, but it is widely shared – especially in places
like Argentina and East Asia, which have recent experience of severe financial
crises, but also by an increasingly vocal section of public opinion in the
not underestimate the attraction of the rival gathering, timed to coincide with
yours, that has just finished in Porto Alegre, Brazil.
Its title, “World
Social Forum”>>, is intended as a criticism of yours,
implying that you are interested “only” in economics, or in profit, and that
you do not care about the social effects of your economic activities. And that criticism resonates around the world.
believe that perception is wrong - and that globalization, so far from being the
cause of poverty and other social ills, offers the best hope of overcoming them.
But it is up to you to prove it wrong, with actions that translate into
concrete results for the downtrodden, exploited and excluded.
is not enough to say - though it is true - that without business the poor would
have no hope of escaping their poverty. Too
many of them have no hope as it is.
must show that economics, properly applied, and profits, wisely invested, can
bring social benefits within reach not only for the few but for the many, and
eventually for all.
of the business leaders among you may respond that that is not the business of
business - that your job is only to look after the bottom line, and the
interests of shareholders. They
would argue that social policy is a matter for governments, and also that it is
up to governments to ensure that more people enjoy the benefits of capitalism,
by creating a business-friendly climate in each country.
there is much that governments can and must do.
I will come to that in a moment. But
more and more business leaders are realizing that they do not have to wait for
governments to do the right thing, and indeed they cannot afford to.
In many cases, governments only find the courage and resources to do the
right thing when business takes the lead.
am glad to say that many business leaders have responded to the call I first
made in Davos three years ago, when I proposed the Global Compact.
They have publicly espoused the nine principles that I set out then –
principles drawn from international agreements on human rights, labour standards
and the environment. And we are
working, together with the International Confederation of Free Trade Unions, and
leading non-profit groups that have relevant expertise, to help those business
leaders ensure that the nine principles are really applied in their day-to-day
is good, but the Global Compact asks for more.
are many positive ways for business to make a difference in the lives of the
poor - not through philanthropy, though that is also very important, but through
initiatives that, over time, will help to build new markets, as well as
improving the self-respect of the corporations concerned and the respect they
enjoy in the wider community.
business leaders are recognizing that there are many small and poor countries in
which they do not invest enough - not because these countries are badly governed
or have unfriendly policies, but simply because they are too small and poor to
be interesting markets or to become major producers, and because they lack the
skills, infrastructure and institutions that a successful market economy needs.
The unpleasant truth is that markets put a premium on success, and tend
to punish the poor for the very fact that they are poor.
alone in their poverty, these countries are all too likely to collapse, or
relapse, into conflict and anarchy, a menace to their neighbors and potentially
– as the events of 11 September so brutally reminded us – a threat to global
security. Yet, taken together,
their peoples represent a very large potential market - and many of their
disadvantages could be offset if international business and donor governments
adopted a common strategy aimed at making them more attractive to investment and
ensuring that it reaches them.
companies can make a massive difference with really small investments.
Take the case of the world's salt manufacturers.
Working with the United Nations, they have made sure that all salt
manufactured for human consumption contains iodine.
result is that every year, more than 90 million newborn children are protected
against iodine deficiency, and thus against a major cause of mental retardation.
me challenge all of you to follow this example, and think of ways that your
company can help mobilize global science and technology to tackle the
interlocking crises of hunger, disease, environmental degradation and conflict
that are holding back the developing world.
join in the Global Health Initiative, which this Forum has been discussing over
the last few days.
work with the new Global Fund to fight AIDS, TB and malaria, to provide at low
cost the products developing countries need for disease control.
is a shocking fact that, out of the 1,233 drugs licensed in the world between
1975 and 1997, only 13 were for tropical diseases, and only four were
commercially developed specifically for tropical diseases suffered by human
beings. We can surely improve on
this, now that governments –- working with foundations and international
organizations –- are starting to offer venture capital for the private sector
to develop medicines and vaccines for these neglected diseases, on condition
that the new compounds are marketed to poor countries as close to cost price as
the last two years I have seen this differential pricing applied to medicines
for treating malaria, HIV, TB and sleeping sickness.
Now, the new Fund should enable many more countries to take advantage of
together for health is not just a matter of charity.
It also makes economic sense. A
scientific study, led by Jeffrey Sachs of Harvard, has now proved what many of
us from Africa already knew. Investments
in the health of poor people are a springboard for economic growth, with as much
as a six fold return on investment.
much the same applies to education. In
the developed world, companies give large amounts of money to universities, not
out of charity, but to maintain the flow of skilled engineers and scientists
that the economy needs. Why not do
the same in developing countries, where it would make an even greater
you start thinking creatively along these lines, you will come up with ideas
much faster than I can. Please
bring them to the United Nations Development Programme -– or to whichever of
the various UN funds, programmes and agencies is directly involved in your
sector. We will be more than happy
to help you find partners in the developing world.
and partnership are the two key ingredients of success.
needs enlightened partners in government, but it need not wait passively for
them to appear. In many countries,
the voice of business leaders plays a very important role in molding the climate
of opinion in which governments take their decisions.
governments do indeed have a decisive role to play, in the months and years
ahead, in determining whether globalization really is made to work for the poor,
or whether, even as it bridges geographical distance, it widens the material and
psychological distance between the privileged and the powerless.
first, vital test will come as early as next month, with the International
Conference on Financing for Development, in Monterrey, Mexico.
believe this Conference offers us the best chance we have had, in many years, to
unlock the financial resources that are so desperately needed for development.
I believe tangible results are possible.
is essentially up to the governments of the world to prove me right, and the skeptics
the one hand, the Conference must strengthen and sharpen the consensus that now
exists on the policies, mechanisms and institutional frameworks required, in
developing countries, to mobilize domestic resources, and to attract and benefit
from international private investment. In
particular, there should be agreement to conclude a comprehensive international
convention against corruption, providing, for example, for the repatriation of
illicitly transferred funds.
at the same time there must be real movement forward on four key issues that are
of vital importance to all developing countries:
trade, aid, debt, and the management of the global economy.
trade, an event of great promise occurred in Doha last November, with the
agreement to open a new round of negotiations that will address the concerns of
developing countries. But so far,
it is only a promise. We need
results. The developed countries must negotiate in good faith, to stop
flooding the world market with subsidized farm exports, to the detriment of
developing countries, and to open their own markets to labour-intensive products
from those countries.
even when a door is opened, you cannot walk through it without leg muscles. So, as trade barriers are removed, we must make sure that
developing countries receive the assistance they need to develop their
infrastructure and capacities.
need at least an extra $50 billion of official development assistance (ODA) each
year if we are to reach the Millennium development goals, including the halving
of extreme poverty in the world by 2015, to which all the world’s governments
have committed themselves. That
means doubling the present figure for ODA –- which may sound ambitious, but
would still leave us well short of the recognized goal of 0.7 per cent of gross
national product for all donor countries. I
still see no good reason why the Monterrey Conference should not adopt that
extra $50 billion as an immediate, short-term target, to be achieved within two
or three years.
should also be the occasion for creditor countries to give a clear commitment to
implement the Heavily Indebted Poor Countries initiative fully and promptly, and
indeed to go beyond it so that from now on the debts of those countries become
truly sustainable. And something
also needs to be done to ensure more equitable burden-sharing in financial
crises involving middle-income countries, as in the recent tragic case of
all these issues can no longer be settled in private conclave among the rich and
powerful. The developing countries
have as a big a stake as anyone in the future of the world economy. Their views should count for something when decisions
affecting it are taken. The
Monterrey Conference should be the occasion for those who currently wield the
greatest influence to show that they are taking this subject seriously.
am glad to say that many business leaders are showing a great interest in this
Conference, and playing an active part in the preparations for it.
I hope they will make a big effort between now and then to ensure that
their governments take it equally seriously.
No one is better placed than they are to refute the arguments of
protectionists and penny-pinchers, making a persuasive case for genuinely open
markets and more generous official assistance.
think we all have a sense today of having come to a turning-point in history.
We felt that already with the end of the cold war and the beginning of a
new millennium -– and then, last September, we found ourselves entering that
new millennium through a gate of fire, such as none of us ever wished to see.
forces of envy, despair and terror in today’s world are stronger than many of
us realized. But they are not
invincible. Against them, we must
bring a message of solidarity, of mutual respect and, above all, of hope.
cannot afford to be seen as the problem. It
must, working with government, and with all the other actors in society, be part
of the solution.
that message go out today, from this stricken but indomitable city, and let us
make it heard throughout the whole world.
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