Economic Globalization: Democratic and legitimate global governance institution, hypothesis and realism.

লিখেছেন লিখেছেন শাহরিার কবির ০৩ জানুয়ারি, ২০১৩, ০৭:৪৪:১৮ সকাল

Executive Summery:

By the swept of globalization state boundaries gradually are becoming less important, investment, technology, finance capital, labour and ideas generate an integrated world economy. Our political institutions, however, have lagged behind. “We have a global economy but not a global polity”.

In the twenty first century world had changed dramatically not only in economic spare but also in institutional arrangement. World citizens are keener about legitimate and democratic global governance. The wave of democracy created optimism, people voice played important role to shape policy issue. Jubilee 2000 campaign had secured assurances from WB/IMF and rich countries for debt relief to poor countries of the south; protests on the streets of Seattle made WTO wake up to listen to voices of discontent. It direct towards bigger economic integration but still world seems more restrictive and protectionist about low skilled labour and Intellectual property rights which result inequitable distribution of benefit and prosperity. However rich and powerful countries enjoy and properly exploit the advantage of global governance where as poor and week placing at a substantial obscurity.

Only global governance institution can solve this problem but our institutional arrangement did not base on democracy and some time lack of legitimacy exhibit the need for a new outline. Disappointments to avoid Iraqi war present the limitation of global institution which was earlier bringing up by the head of Government/State at UN in the Millennium Assembly . In my essay writing I try to mirror present anxiety of global governance institution especially their democratic and legitimate nature.

Introduction:

The eighteenth century presented humankind with two visions, namely, a vision of economic prosperity based on free markets and a vision of “liberty, equality and fraternity” based on democratic political institutions. The “first industrial revolution” in England was the forerunner of material prosperity while the French Revolution raised the banner of a liberal polity and society. “Liberalism in one country” assumption is being challenged by the forces of economic globalization. Politically and economically World changed beyond recognition during twentieth century. Communism collapsed and capitalism conquering, technological change has abridge time and distance. Regional integration through economic cooperation make national border less important. Most developing countries reform their domestic economic policies to comply with world trade and attract FDR and push regional trade through regional block which promote global economic cooperation. It is known as “Washington consensus” . The Keynesian consensus has disappeared from the industrialized countries.

International organizations are assailed from the left and right. The antiglobalization movement accuses the WTO, World Bank, and IMF of imposing a harsh and exploitative “neoliberal” capitalism on the world. Right wings allege that, while claiming to promote market-based economic reforms, they actually distort market incentives, creating “moral hazard.” International organizations behave hypocritically. A former World Bank chief economist has claimed that IMF and World Bank have betrayed the principles they were founded to promote, and still espouse. Neoconservative political advocates have accused the United Nations of contravening its founding ideals. International organizations proclaiming a commitment to democracy and national sovereignty are accused of eroding both. UN criticized for betraying its principles in the face of mass atrocities and genocide in Rwanda and elsewhere. Recently, IR scholars have begun to consider the sources and implications of hypocrisy in international organizations, developing theoretical accounts of hypocrisy across a range of organizations. Intergovernmental organizations (IGOs) declare reform but that is not carried out. The WTO advocates free trade but wealthy member states maintain agricultural subsidies and tariffs that harm developing world farmers. IOs proclaim commitment to the norm of sovereign equality, but in practice agenda-setting and decision-making reflect the relative power of member states.

1. Global challenges: old and new

Approximately 1.2 billion people in the developing world reside in absolute poverty, 840 million people undergo from malnutrition and, 850 million adults remain illiterate. Former Soviet Union and Eastern Europe remains unfinished which convoy poverty and inequality because of economically fragile and politically shakiness. In another part nation-states split and skid into ethnic friction or civil war. As a result civilized catastrophe has climbed severely but international community reaction has been derisory. The rapid integration of international financial markets, combined with the explosive growth in portfolio investment flows and short-term capital movements, has led to volatility in capital flows and instability in exchange rates and the management of these is complicated and failure can result in massive economic crises. This can easily get hold of political dimensions.

In trade and commerce globalization occurred rapidly which encourage trade liberalization but still benefits allocate asymmetrically. Poor have been put at the end of the backlog. Protectionist forces dominance by United States and tariffs has been imposed on timber imported from Canada, contrary to the spirit and perhaps the law of North American Free Trade Agreement (NAFTA). Tariffs of up to 30 per cent have been imposed on imported steel, in violation of agreements under the World Trade Organization (WTO). United States initiated 79 anti-dumping investigations in 2001 to restricting imports from low-cost producers. Price competitions promote anti-dumping which is a contradiction of liberalization and mismatched with equitable global economy. United States launches massive subsidies to the agricultural sector in 2002 because of the pressure coming from the farm lobby, which is a turnaround of his trim down farm subsidies policy. It is fade the shrink farm subsidies campaign in Europe and Japan.

Greater globalization promotes free movement of goods and services towards a world of open border. Again allocation of world income is grotesquely unequal and to manage state border from illegal migration increasingly complicated. Neither the Rio Grande nor metal fences have prevented millions of illegal migrants from entering the United States from Mexico; the Channel tunnel made it easier for undocumented workers to get into Britain; the Adriatic Sea been a feeble barrier to Albanians wishing to enter Italy and this migration system transformed poor workers into illegal workers, to the benefit of no one.

Historically progressive people and those wishing to assist developing countries have been in favour of creating a strong international agency that would address a broad range of issues concerned with international trade but demonstrations against the WTO in Seattle and elsewhere tell the different. The WTO can help to counteract this because it contains some provisions for compensation in cases where a country violates an agreement and thereby inflicts harm on others. It is true that this compensation mechanism is narrow, and the process of adjudication is so cumbersome that it can drag on for several years. United States has not hesitated to disregard the dispute resolution procedures of the WTO when it has suited its interests, and has sought in other ways to get round its commitments.

Each institution should be responsible for a specific area of activity and considerable effort should be made to prevent overlapping jurisdiction and the resulting turf warfare, muddles and lack of accountability. Transparency of responsibility is conducive of efficiency, but also rich and powerful countries can engage in recreation one organization against another in a process of divide-and-rule. Such as there are objections to certain environmental externalities that have translational implications that are the responsibility of the United Nations Environmental Programme (UNEP) rather than the responsibility of the WTO. Imposition of trade sanctions to accurate environmental externalities or to discourage undesired labour practices such as child labour is more likely to lower global well-being, and hurt the poor in the process, than to raise it.

Legitimacy, in turn, will require a much larger role than is at present the case for democratic decision making in institutions of global governance. Much of the opposition to globalization arises from the fact that ordinary people have little control over the global forces that increasingly shape their lives. It is recognized that equity is a global public good and that the lack of equity undermines global security and makes global cooperation more difficult. Peace and equity can be considered to be “primary global public goods” and democratic institutions of global governance are necessary to ensure an adequate supply of these goods. The present system of sovereign states, however, is incapable of supplying global public goods. This can only be done by institutions of global governance. States relinquish some of their sovereignty to global institutions and that these new institutions are organized on democratic principles in order to ensure their legitimacy and wide acceptance.

Like it or not, state “sovereignty is no longer absolute, but conditional.” Impersonal global economic forces are eroding the ability of states to control events inside their territory and active intervention by outside parties, as in Kosovo has established the principle that human rights supersede, or at least qualify, the sovereign rights of states. Indeed “the war in Kosovo represents the last blow to the concept of national sovereignty” and the idea that what a state does inside its borders is its own business.

Democracy would bring the people inside the tent and give them a voice within democratic institutions but people who have no voice in an institution they will take alternative and that would be protest in the streets.

Today our international affairs, including our global economic affairs, are largely governed or regulated either through the unilateral action of the United States, the dominant, self-declared “indispensable” country, or through coercion by a coalition of the rich countries. The alternative to the status quo is a rule-based system of governance backed by international law and enforcement mechanisms that ensure that the rule of law does indeed prevail.

By 1999, foreign direct investment in low and middle income countries was five times larger than official development assistance and foreign aid itself began to decline. In 1999, official development assistance was only 0.24 per cent of the gross national income of donor countries, as compared to the U.N. aid of 0.7 per cent. Moreover, between 1993/4 and 1998/9, foreign aid declined in real terms by 1.4 per cent a year. Foreign aid, as we know it is disappearing rapidly.

Because of institutional disappointment Countries and individuals are marginalized which have generated proposals for reform. If it is inadequate that does not mean it is possible to formulate a new prescription that is satisfactory and achievable. The world is an imperfect and messy place by different opinions and suggestion of global transformation will reduce the code of democracy, equity, and justice. If global governance reforms are essential to face the challenges of 21st century, the issue of “adequacy” of the nation-state as a unit of representation, agency and legitimacy in the global age could also be questioned.

3.1 Global Governance:

No international government exists but global governance certainly does. "Governance" is a decision making processes that are less formal than a government. It defines as making and execution of rules, and exercise of power, within a specified domain of activity. Deficiencies of global constitution create global governance actions less legitimate. Moreover Governments accountable to the citizens but markets are not and globalization is market-driven processes which mean national economies are much less governable while the global economy is almost ungoverned. Moreover amplified openness, interdependence and integration attributable to globalization have made it more difficult for governments to intervene and combat such exclusion without any increase in global governance.

3.2 Democracy:

UNDP issued a report in April 2004 about “Democracy in Latin America” directed by Dante Caputo. Report revealed that 54.7% people favour dictatorial regime if it facilitates poverty alleviation and sought economic problems, 43% support democracy and 26.5% were critical of democracy; these attitudes came from a continent that has suffered for decades from the lack of democracy. Such a trend seems to be present world wide; these were the findings of the two worldwide surveys of representative samples of the world population that conducted in 1999 for the Millennium Assembly of the United Nations and in 2002 for the World Economic Forum. In the 1999 survey, 62.1% of the 57,000 persons interviewed in 60 countries believed that their countries were not governed by the will of their people. In the 2002 survey, the percentage of people who thought they were not governed by their will was 52% in North America and 61% in the European Union.

"Increasing opportunities for voice and participation can improve state capability...”. The U.N. Commission on Human Rights states that at the national level, "the widest participation in the democratic dialogue by all sectors and actors of society must be promoted in order to come to agreements on appropriate solutions" . The Organization for Economic Co-operation and Development has extolled the value of "active participation" at the national level in which there is "a role for citizens in proposing policy options and shaping the policy dialogue--although the responsibility for the final decision or policy formulation rests with government".

Susan Marks has explained, "Democracy cannot flourish in nation-states unless efforts are made to democratize the processes of transnational and global decision-making as well". Boutros Boutros-Ghali has observed that NGOs, parliamentarians, and international lawyers act at various levels of the international system as "mechanisms of democracy". A recent U.N. Human Development Report stated that "one big development in opening opportunities for people to participate in global governance has been the growing strength and influence of NGOs--in both the North and the South".

3.3 Inadequacy of global governance:

UN conferences on Financing for Development reinvigorate about policy dispute on governance shortfall in the international economic, financial and trading systems and projected the weakness of UN. Existing global governance archetypes emphasize dominance of deregulated, market led growth which facilitates capital accumulation without a fair distribution of the profits derived from production and trade, and ultimately serves the corporate interests of the rich industrialized countries. BWIs the WTO, Financial Stability Forum and the Bank for International Settlements are repercussion of dominance by industrialized countries, particularly the G-7.

Some emerging market economies fight back with their unsustainable debt burdens and there was no adequate means for debt relief. Moreover pressure building up to liberalize market economy and grant extra advantage in support for FDR to catch the attention of TNC is another means of external interference by International institution and these BWIs-led stress on developing countries market liberalization add more vulnerability. BWIs policy-based lending full with conditionality really amplifies poverty and undermines public service. Clause for privatize public services, put wheels over public spending, import liberalization and expansion export sector did not mach in all time which never improve the growth prospects of developing countries and this had a negative collision on social structure which encourage revolution against government even some time protest grown up against the BWIs institution. More over it manipulate Labor markets and in the name of golden handshake million people become unemployment due to lack of trade opportunity. Rather then creating jobs market it leading redundancy. ILO estimates number of unemployed worldwide grew up by 180 million in 2003 and by the end of 2002 figure of working poor or workers lives on $1 a day or less reaching to 550 million.

Gender equality and human rights are the central commitments at UN Millennium Assembly in 2000 and encouraged elimination all forms of discrimination against Women.” But Women and children are most deprived cluster in the world. “When we tried to escape they shot more children, they raped women; I saw many cases of Janjawid raping women and girls. They are happy when they rape. They sing when they rape and they tell us that we are just slaves and that they can do with us how they wish.” In Darfur countless women and girls were raped, abducted and forced into sexual slavery by the Janjawid, nomad militias armed, paid and supported by the Sudanese government and this mass rapes, including gang rapes of school children, were clearly war crimes and crimes against humanity.

Contemporary model of economic globalization is no means impartial. Women normally have more vulnerable and lowest paying jobs and living in rural areas and earning from informal sector and are placed in Export Processing Zones. Thrust for privatization of essential services place additional burden on poor women.

TRIPS exemption provisions on generic life-saving drugs such as for HIV-AIDS will offer no real relief to nations heavily affected by such illnesses. Moreover, sustainable development in some cases contradicted with social and environmental principles. In Doha round market access, special and differential treatment, antidumping measures and the phasing out of agricultural subsidies continue to defy efforts at reaching solutions.

With regard to the corporate sector, the tremendous power of the large transnational corporations (TNCs), their capacity to influence the economic policies of their home mainly G-7 countries, and by extension the global governance institutions, are pressing issues for global economic governance, not least because they are driven primarily by the individual profit motive rather than public interest or development concerns.

Democracy stands on equality which is safeguarded by voice, transparency, accountability and fairness. “Developing countries account for more than 80 per cent of world population and contribute almost 50 per cent of world output” but there is no satisfactory institutional provision regarding distribution of wealth between develop and developing countries. Influence in multilateral institutions are inadequate and at nastiest trivial to unravel the problem. Representation and decision-making process of the present organizations are even less democratic. The Security Council veto power explicitly unfair, decision-making by consensus in the WTO also undemocratic, if there is bilateral arm-twisting or a consensus is hammered out among a small sub-set of powerful players, while most countries are silent spectators that are in the end a part of the apparent consensus. Democracy is about shield of minority rights. The concerns of poor countries and poor people should, therefore, constitute an integral part of any democratic design for global governance.

3.4 Principles of democratic governance:

* Global institutions and agenda should be subjected to democratic political accountability.

* Democratic polity at global level requires legitimacy of popular control through representative and direct mechanisms.

* Citizen participation in decision-making at global levels requires equality of opportunity to all citizens of the world.

* Multiple spheres of governance, from local to provincial to national to regional and global, should mutually support democratization of decision-making at all levels.

* Global public goods should be equitably accessible to all citizens of the world.

4. THE EXISTING INSTITUTIONS:

4.1 United Nations:

Over 50 years, the United Nations System has little success but its achievement as a global institution on question especially about peach and Security concern. Under Article 7 of the UN charter the Secretariat, General Assembly, the councils and the International Court of Justice, is the “principle organ” of the UN. Article 100 requires UN “officials not to request or accept advice from any government or authority exterior to the Organization”. But notable its powerful members constantly attempt to influence UN officials in their favor. The Secretary General is not a powerful man. He acts like a watchdog without teeth and there is no such a procedure to implement his recommendation. UN General Council is mere a debating society though it is democratic in nature but the effectiveness and willingness of execution of its recommendation makes global governance institution more challenging.

On part of peace keeping there is no permanent peace keeping force under UN. The UN performance in Bosnia and Rwanda were widely apparent as dismal failures, bypassing of the Security Council over Kosovo issue reinforced that UN peace and security role was being obscure. The brutality in Darfur was a critical test for UN to act in response efficiently to major human rights crises where UN failed again. “Safe areas” designated by the Sudanese government and the UN for the internally displaced of Darfur, for example, proved to be anything but safe. Monitored by the government’s security and military intelligence, the displaced people remained vulnerable to arbitrary arrests, rape and killings by government security forces and When the El-Geer camp was bulldozed and residents were assaulted and tear-gassed, with UN and African Union (AU) representatives present, the protests of the international officials were simply ignored. Political commitment and disagreement reduces the legitimacy of the UN Security Council. This evidence more then enough for demanding more democratic UN and without reform which can not attainable.

Greater participation ensures transparency. Security Council membership should be increase. Germany, India and Japan should be considered because of their economic and nuclear capability, even there is no developing countries representative except China.

Its Veto powers are neither democratic nor lawful. Permanent Members enjoy this privileged status because it defended them from each other assassination. Peacekeeping can be dysfunctional when pressures to ‘do something’ in response to political or humanitarian crises are met by symbolic responses not supported by the resources or political commitment necessary to act effectively. Michael Doyle describes this syndrome as ‘an irresponsible divorce between the Security Council and the UN operation in the field’ which is sometimes called a “commitment gap”. Resolution 918 of May 17, 1994 authorized an expansion of the previously gutted peacekeeping mission in Rwanda, and imposed an arms embargo on Rwanda which was not matched by action, as UN member states declined to provide troops to implement the resolution. Michael Barnett argues that this path was chosen over than a more limited but feasible American option, because the American proposal “would not represent the public relations coup desperately desired by a UN that was increasingly embarrassed by its inaction.” Barnett points out that, Passing resolutions that did not stand a chance of being implemented, and sending emissaries into emissaries into the field to try to produce a cease-fire when it was clear that none would be had—these and other diplomatic undertakings can be reasonably and rightly justified on the grounds that attempts had to be made...but these activities also served another function: they helped to hide the UN’s reluctance to act. David Rieff recounts that “As was so often the case with United Nations resolutions on Bosnia, the stated purpose of a given decree was rarely the same as its real goal.” Safe areas in Bosnia were another incidence Where Serbs had twisted Srebrenica. Safe Havens policy was adopted under resolutions 819, 824 and 836 and only 7,600 troops were authorized when UNPROFOR’s Force Commander estimated 34,000 to deter attacks on the safe areas and lack of troops ensued Srebrenica into a real killing ground. In early March 2005, following the killing of nine Bangladeshi peacekeepers, MONUC forces using armored vehicles and supported by an attack helicopter killed as many as 60 militia fighters of the ethnically Lendu Nationalist and Integrationist Front (FNI) in an offensive operation in the eastern Ituri province. There were reports of civilian casualties. The MONUC Force Commander commented regarding such operations that, ‘It may look like war but its peacekeeping’. In 1995 Secretary-General Boutros-Ghali proposed in U.N. that “peace enforcement” units be created, and that these military units have weapons and the authority to use them.

4.2 The Bretton Woods Institutions:

In the 1940’s when Bretton Woods institutions were founded, main argument behind the creation was World Bank responsible for supplying capital to countries undergoing post-war reconstruction or post-independence development, an International Monetary Fund that would be responsible for providing finance to countries that encountered short-term balance of payments difficulties, and an International Trade Organization that would create and enforce equitable “ rules of the game” and which would prevent the United States from maintaining the dominance of world commerce. But United States vetoed the idea and at the end, instead of ITO, General Agreement on Tariffs and Trade (GATT) was created which, was prejudiced from its beginning in favour of the trading interests of the rich countries that dissatisfied developing countries. Developing countries fasten together with United Nations Conference on Trade and Development (UNCTAD), but it became talking-shop.

The Meltzer pointed to the problems of poor performance within the IFIs and the blurring of functions between them. The UN Secretary General stressed that ‘significant steps are needed to overcome the perception among developing countries that they are underrepresented in both bodies (IMF and World Bank), which tends to put their [IFIs] legitimacy in doubt’.

Participation in the decision-making practice is the key to success for governance, but inadequate representation from developing countries in IFIs is a serious blockade for democratic global governance which tied with deficiency of transparency. The Monterrey Consensus addressed the significance of input and plea for developing and transition countries to furnish them larger say on global economic governance issues and recent UN report confirms no substantive reforms have commenced.

A) Voting supremacy:

Equitable voting can create IFIs is a legitimate institutions. Industrial countries account for 62% of votes in the IMF and 61% in the World Bank while developing and transition countries account for the remainder. Considered on a constituency basis—that is, the proportion of votes commanded by the developing and developed country Executive Directors(ED) sitting on the Board the situation is worse. ED belongs to developing countries be in command of only 26 percent. All members receive equal basic votes. Weight of basic votes has turn down due to boost of quotas. ‘Basic votes’ represented just only 2.1 percent which means equality of states in voting system has been battered. China has same quota as Canada, while the GDP of the former is the double of the GDP of the latter and variables in the quota formula tend to measure supply determinants, which are typically partial to developed countries, rather than demand factors that reflect the needs of developing countries. Moreover trade among countries that are part of the same currency union should not be counted as international trade, which supported by Leo van Houtven, a former Secretary of the IMF Board, to the twelve Euros zone member countries, would result in an 11.4 percentage point decline of their quotas. Furthermore quota system determining level of access to resources by the country and its depend on countries contributes to the institution which is not fair.

B) Board Composition:

In IFIs 24 EDs represent 184 countries and only two EDs represent more than 42 countries in sub-Saharan Africa while five richest countries have each their own ED and more then half ED from industrialised countries With only one exception, mixed constituencies (constituencies that include both developed and developing country members) are represented by a developed country. The international development secretary, Hilary Benn ‘has called on Europe and the United States to relinquish their hold on the presidencies of the World Bank and International Monetary Fund’. He said that “international institutions, including the United Nations needed to better reflect the current world rather than the post-1945 international settlement and questioned the US-European deal whereby an American is in charge of one institution, currently Paul Wolfowitz, the neo-conservative former deputy US defence secretary, is in charge at the World Bank while a European, Rodrigo de Rato is managing director of the IMF ‘Perhaps we should move towards a rules and merit-based process for appointing the senior management of all the international financial institutions’.” "Is it really acceptable that the presidencies of the World Bank and the IMF should be restricted to European and US nationals respectively, because of a cozy deal made 60 years ago" he cited the examples of Vietnam, where 11 different UN agencies administered 2% of the country's aid, and Zanzibar, where 20 separate UN agencies operate in a country of only 1 million people.

Gender representation also reveals some glaring imbalances. Out of 24 member Executive Board only one woman represented in the World Bank’s and two women in IMF’s.

C) Consensus System:

Inequitably distributed of voting should not be a problem if the institution runs by consensus. In the IMF and the World Bank, Secretary keeps a tally of votes on particular decisions which assists the Chairman in formulating the ‘sense of the meeting’, that ‘sense of the meeting’ simply reflects the respective voting powers of those who favour and oppose a particular outcome. Where as some issues which may lack support from key shareholders never even presented for discussion. In IMF US share is 17%, if any decisions taken by majority goes against them, they exercise their veto power to block it.

D) Selection Process:

On an unwritten rule or gentlemen’s agreement, USA and EU selected the heads of the IFIs and WB. US nominate the President of the WB, while Europe appoints the Managing Director of the IMF. The selection process has criticized on two recent occasions, controversial appointment for nomination of a successor of former IMF Managing Director, Mr. Horst Koehler, and World Bank President, Mr. James Wolfensohn and following the controversy in 2000 around the European nomination of Caio Koch-Weser, a committee of EDs recommended an open and competitive process of selection. More recently, calls for an open and competitive process in selecting the World Bank President also went unheeded. It is a one-horse race, the United States’ only candidate, Mr. Paul Wolfowitz appointed. The scandal-hit World Bank president Paul Wolfowitz hung in the air on 20 April 2007 after a crisis meeting of bank directors, as pressure on the former Pentagon number two mounted in Europe, though he refused to resign. 90 % of IMF professionals with PhDs from western university, 80 % trained in economics and finance and a clear dominance of western educated in management post.

E) Transparency:

The lack of transparency regarding Board discussions and operations leave Executive Directors (EDs) unaccountable for their positions. The IFIs did not release records of conference and it is hard for outsiders to be aware of ED position about representing their country. Judgments about country’s compliance also take behind closed doors.

Sovereign Debt Restructuring Mechanism (SDRM), which was criticized due to short of consideration for poverty reduction and addressing only a portion of the debt and achieved better inter-creditor coordination, also frustrated by IMF. The Helsinki Process anticipated the establishment of independent debt arbitration as “an effective mechanism for debt negotiation” and CIDSE continues to call for a Fair and Transparent Arbitration Procedure (FTAP): an independent debt workout mechanism approved by creditors and debtors alike, aimed at poverty reduction, and including the participation of representatives of those whose lives would be most seriously affected by its decisions.

As a specialized agencies IMF and World Bank directly setting policy on non economic matter and some time influence other institution by economic policy prescription. There is a pre dominance of IFIs prescription over other agencies if conflict arises. It is a common practice because of it power and influence. So its power needs to be control and there should be check and balance between all organs of UN. UN Secretary General noted that "it is the only organ if the United Nations explicitly mandated by the Charter to coordinate the activities of the specialised agencies.”

4.3 World Trade Organization (WTO)

WTO has already shown itself to be a success but it is under strong attack on two point, firstly WTO has not—and will not—resolve every problem facing the global economy and social development and, on the other, that the machine is out of gear, idling, and failing to tackle the new challenges presented by the process of globalization. Some developing countries claim it is inherently biased against their interests and produces asymmetrical agreements and also disappointed by the level of trade-related technical support they have received from donor countries and other multilateral institutions in order to cope with the pressures of implementing WTO commitments. WTO extensive schedule of formal committee and working group meetings, important matters are routinely discussed and decided in small, informal gatherings to which they are not invited or in which they lack the staff or expertise to participate and that’s why some developing nations call WTO as a “black box,” an institution from which decisions affecting their interests emerge in a mysterious and unaccountable fashion.

Seattle Ministerial Meeting in 1999 WTO face unprecedented protest about labour standards, investment and competition policy and develop and developing countries variance on many issues throw WTO into gridlock but which was resolve after the Doha Ministerial Meeting in 2001.

It is too young to make any remark. WTO Voting system and dispute settlement process seems more democratic in nature but developing countries participation in the system shows weak and voracious. They must put their collective action sufficiently to realize the opportunities.

Christine Dawkins observed during the GO2 Conference: “The relations between UN and international economic institutions are weak; the present system keeps World Trade Organization as a dominant authority, over and above the UN…….”

Roberto Bissio observed “The problems we are facing have to do with service discussions (GATTS in WTO). Many states have human rights agreements which are legally binding; WTO has strong teeth, while human rights framework is not strong in penalizing non-compliance by governments”.

Regional trade agreements contradict with WTO MFN clause. NAFTA, MERCOSUR, ASEAN etc.; has a prejudiced effect because this regional agreement did not treat all member of WTO equally, even bilateral arrangements and trade cooperation are deadlock for global economy. In addition APEC, ASEM, Cotonou Agreement is overlapping with trade and human right so is it coming under the umbrella of WTO or under the jurisdiction of MFN. John Clarke remarked “….erosion of sovereignty of state goes deeper than WTO; economic policy space has reduced for developing countries……look at exchange rates, fiscal regimes, interest rates…… Therefore, mere derailment of WTO process may not be enough, since these may be replaced by bilateral regimes which are more unequal in power”.

A) The policy framework of the WTO:

In WTO ministerial meeting Trade ministries are giving most priority for trade and investment agreements then anything and these leading to a chronic imbalance of priorities. World Bank and IMF encourages small and weaker governments for liberalization of trade, privatization of public service, special protections and facility for foreign investment which inconsistence with public goods. Moreover WTO “one-size fits all” model of economic management causing a democratic deficit, limiting extensively what citizens can decide through their own governments. Even most governments and ordinary citizens did not understand TRIPS and its trade values.

B) Internal governance deficits:

Informal decision-making processes are extremely illusive and its agendas are dominated by four powerful nations and by mini-ministerial meetings involving only two dozen of member countries, leaving many members marginalized. “Green Room” practice regarding decision making is another area of concern. The capacity of many, perhaps most, developing countries to participate effectively in the WTO system is very much in doubt. However it is a member-driven organization and the continuous WTO process involves at least 45 meetings per week in Geneva and if delegates from member countries are not actively involved in its day-to-day activities, their interests are ignored.

4.4 Enforcement of justice:

Human rights are howling for ages and no universal policy implemented to protect it or safeguard it. Waren Allmond observed “In Vienna Conference in 1993, 130 states agreed that Human Rights are universal and indivisible, but institutions for enforcement of these international standards on Human Right are weak and nonexistent……”

International Court of Justice (ICJ) in Hague established in 1945 to settle disputes between nation-states and so far has played an imperative role with respect to conflicts between member states; however, it has no means to enforce its judgments and rulings. The classic case of Nicaragua vs. USA is an example. In October 1985 USA declare that it will no longer abide by the decisions of ICJ; when the ICJ ruled that USA violated international law and UN General Assembly resolution calling for compliance by the government of USA was carried by 94 to 2 (USA& Israel) vote. Lacks of enforcement procedure of judgments craft ICJ futile. Similarly, judicial reviews regarding violations of human rights particularly in case of women, minorities and indigenous people as we have seen in Darfur, Kosovo, Somalia governments are not well equipped to deal with it.

Stalin killed millions but was never even charged, Pol Pot slaughtered over one million but never saw the inside of a prison cell, Idi Amin and Raoul Cedras are comfortably retired, despite recent legal complications, Chile's General Augusto Pinochet, too, will probably escape trial and Slobodan Milosevic, who has chosen to close out the century by brutalizing Kosovo if international criminal court or tribunal never came across?

Seventy eight nations have now signed the Rome treaty for creation of international criminal court and indicating their intention to join it. Only Israel and the United States - opposed the ICC, thereby joining a rogue's gallery of regimes like China, Iran, Iraq, Libya and Sudan. Israel's opposition is regrettable but understandable. Government of USA declared on May 6, 2002 that it did not intend to abide by it for its own citizens.

But world is moving forward to establish human right and few occasion it is doing well. Consider the case of former Bosnian Serb leader Radovan Karadzik. In 1995 he was indicted for genocide by the International Criminal Tribunal for the Former Yugoslavia. Yet he remains at large, because NATO troops in Bosnia to date have not dared to arrest him. Does his case teach that genocide is tolerated in practice?

The treaty negotiations suggest the significance of this limitation. Germany proposed that the ICC have "universal" jurisdiction, that is, be able to prosecute crimes wherever they are committed. The International Criminal Court (ICC) began the first prosecution of a Democratic Republic of the Congo militia leader, Thomas Lubanga. The International Criminal Tribunal for the former Yugoslavia (ICTY) is the first truly international criminal court to hold individuals accountable for the most serious crimes recognized by the international community. The ICTY was established by the United Nations Security Council in May 1993 to bring to justice those responsible for committing genocide, crimes against humanity and war crimes in the territory of the former Yugoslavia since 1991.

Secretary general Kofi Annan said “The success of international criminal tribunal for Rwanda in prosecuting genocide is a historic milestone and a defining example of the ability of the united nation to create institutions which fulfil the highest aspirations of mankind.”

The Special Court for Sierra Leone is a joint endeavour of the United Nations and the Government of Sierra Leone which was established to bring to justice those most responsible for atrocities carried out on its territory during the conflict which began in 1991.

Bill Pace observed that most western democracy: refuse to act in international arena as democracies: “US threatened to keep its peace-keeping forces out of ICC ……… this is not acceptable. No one has the right to commit crimes, howsoever powerful; the rule of law must apply to all and it prevails.”

5. Democratic Deficit

Democratic deficit exist in both national and International forum. Many state did not believe in democratic practice like China, some are hate this western notion like Middle east Asia, even many country rule by autocrats, however in international spare UN, WB, IMF, ICJ, WTO every where we seen the lack of commitment toward proper democracy. In democratic system majority voice should respect and upheld but in some respect this notion was undermine like million of people show their protest against War in Iraq, human right violation in Guantanamo prison cell are example how voice of million are humiliated, even when peoples elected representative pass a resolution which was defeated by veto power is a sham, like withdraw of Us troops bill passed by Senate defeated by President veto power. "One state one vote" does not follow logically from "one man one vote", giving China and San Tome and Principe an equal say would seem to contradict the principle of "one man one vote," in view of the huge population disparity between the two countries. U.N. Charter states that the Organization is based on "the principle of the sovereign equality of all its Members" which does not seem to indicate that governments have a sovereign right to equal participation in U.N. processes rather, it means that governments are equally sovereign vis-a-vis each other.

Inconsistency within an international organization is more distress about rule of law than democracy. For example "green room" practices in the WTO wherein the officials leading a negotiation will invite selected governments into a room to hammer out a deal that is later presented to the entire membership as a fait accompli.

A second observation is that multilateral organizations fail to require democratic government as a condition for membership. As a result, the United Nations and the WTO consist of numerous governments that are not democracies and cannot make any serious claim to be representing the volitions of their people.

A third view of the democratic deficit is that multilateral organizations where international agenda-setting bodies operate too remotely from the public. Concerns about the lack of democracy are especially salient when international organizations act to sanction governments or to restrict their autonomy and public may also have concern when an international organization (like the World Bank) provides loans for a project that may have deleterious environmental impact on recipient and surrounding countries.

6. Participation in International Organizations:

In 2000, U.N. Secretary-General Kofi Annan declared that "the international public domain.., must be opened up further to the participation of the many actors whose contributions are essential to managing the path of globalization."

Outputs of NGO participation in international organizations decision making process is an emerging issue. Today more than 2,140 NGOs have been granted consultative status with the United Nations. The treaty on landmines is perhaps the clearest example of NGO influence.

McDougal, Harold D. Lasswell, and Lung-chu Chen explained that “either a world controlled solely by "sovereign" nation-states or of a world government supplanting all the existing nation-states and it is a world of pluralism and diversity . . . nation-states, international governmental organizations, political parties, pressure groups, and private associations--are forms of associations through which individuals cooperate to achieve fulfillment of their demands”.

6.1 Overview of the Debate:

According to Susan Marks the nation-state is viewed as democracy's "container" and therefore democratic politics is bounded within the state. Martin Wolf has adopted this position with respect to the WTO in his observation that "[a]s an agreement among states, the WTO cannot itself be democratic."

International organization has to be democratic and it can be achieves through a two-step derivative process. In the first step, international organizations are accountable to governments, and in the second step, each government is accountable to its own public.

David Field has written "[t]he establishment of an international assembly of democratic peoples, directly elected by them and accountable to them, is an unavoidable institutional requirement" for a cosmopolitan democracy. Richard Falk and Andrew Strauss have proposed a "Global Peoples Assembly."

In 1919, Woodrow Wilson explained that the important thing about "opinion" in democracy was not the number of people who hold it, but rather the process of weighing the opinion so "that every voice can be heard, every voice can have its effect, every voice can contribute to the general judgment that is finally arrived at."

Mitrany postulated that Article 71 of the U.N. Charter was an "important step toward a possible modern solution of the problem of democratic representation and NGOs could be made into "instruments of really informed democratic representation."

In 1949, White wrote that [i]t is an expression of democracy when groups from various nations work together in solving their common problems; this is particularly true when they try to influence intergovernmental organizations....thus the influence and the future of international nongovernmental organization are connected with the growth of democratic attitudes within states and also within intergovernmental organizations.

6.2 The legitimacy of institutions:

A country can integrated effectively into the world economy if it’s become a member of WTO family and abide by all the rules and regulation of WTO. Poor countries are likely to have great difficulty attracting foreign investment if they defy the IMF or the World Bank. Increasingly, the rules made by and through global governance institutions affect what were formerly regarded as domestic practices, and cannot easily be evaded.

Second, several global governance institutions significantly constrain state sovereignty. During the 1990s the United Nations exercised effective rule in East Timor, Bosnia and Kosovo; dispute settlement Body of WTO can make judgments binding on members in international law, without their consent; and on a more limited geographical scale, the European Court of Justice has successfully asserted the supremacy of European over national law.

Third, these institutions affect the well-being and opportunities of tens of millions of people, most of whom are at best dimly aware of their existence and know little of their origins and functions. World Bank loan judgment or decisions on resource allocation by the Global Fund to fight against AIDS, Tuberculosis, and Malaria are matters of life and death for people in Africa and Asia. WTO policies on agricultural subsidies and import duties can dramatically affect the welfare of farmers around the world.

6.3 Accountability:

The accountability of existing global institutions is inadequate but that did not mean these institutions are illegitimate. For example World Bank has been accountable to the biggest donor countries, and the Bank therefore has to act in conformity with their interests, at least insofar as they agree. But it is not an effective method of accountability and does not ensure meaningful participation by those affected by rules or due consideration of their legitimate interests and a high degree of accountability in this case may serve to perpetuate the defects of the institution. So accountability per se is not sufficient; there must be effective provisions in the structure of the institution for holding institutional agents accountable for acting in ways that ensure satisfaction of the minimal moral acceptability and comparative benefit conditions.

8. EMERGING ISSUES AND MISSING INSTITUTIONS:

Due to globalization new problem surface like illegal migration, illegal trade between cross broader, drug traffic, children and women traffic, terrorism, organized crime, global climate change etc need to deal by global governance but emerging institutional gap is discernible.

French President Chirac and the German Development Minister Wieczorek-Zeul endorsed the establishment of an Economic and Social Security Council within the UN system as a new international decision-making body for global economic issues. Insufficiencies of current institutional arrangements for economic governance at the global level elevate the need for economic Security Council which can grip financial crisis more promptly. The Asian financial crisis of 1997 illustrated how rapidly economic vulnerability can result in massive suffering for large proportions of the population.

For more then a decade now, the United States has been building up an increasing debt to the UN. It reached more than $ 1.5 billion, where as UN budget is $ 1.25 billion. Financial independency is the key for self-governing decision making, due to lack of finance UN depend too much for its donor and some time did not achieve its object and failure of peach keeping mission is one of them which provide a rationale for restructuring UN financing arrangements. Also, the weakness of political will in humanitarian emergencies suggests that an enhanced UN role in the future depends in part on a financing structure that is independent from P-5 control.

9. Non-Universal Global Society:

David Held has recently outlined in a very sophisticated way a vision of three models of sovereignty: classic, liberal, cosmopolitan. For Held, there has been movement over the past century from classic to liberal sovereignty and in liberal conceptions of sovereignty; legitimacy is not conferred automatically by control but multilevel governance, including governance at the global level, will be “shaped and formed by an overarching cosmopolitan legal framework”. Hedley Bull drew an important conceptual distinction between society and system. The states in an international society, for Bull, are “conscious of certain common interests and common values.” They “conceive themselves to be bound by a common set of rules in their relations with one another, and share in the working of common institutions”. States in an international system that is not an international society do not share common values or work together in international institutions.

Since in the contemporary world entities other than states help to compose society, it seems more appropriate to speak now of global rather than international society. But 9/11 makes us cautious about universalized. Terrorists attack back into our lives with a vengeance. Moreover world is not neatly divided into “zones of peace” and a “zones of turmoil”, or areas of “complex interdependence” and “realism”. A universal global society is more aspiration than reality but the torturers and mass murderers of the world do not share fundamental values with committed and humane democrats. In the wake of 9/11 we have become acutely aware of terrorists’ attempts to kill other people, personally unknown to them, who merely stand for hated values or live in states whose policies the terrorists oppose and millions of people cheered or at least sought to justify the evil deeds of 9/11.

On a global scale, common values are lacking such as Taliban or Iran did not try to emulate the social organization of western society, and in fact rejected much of it, such as the practice of enabling women to live public lives and many fundamentalist religious people do not share – indeed, reject – secular ideals such as those of pluralist democracy. Indeed, one reason that democratic values are not spreading universally is that dogmatic religions claiming exclusive access to comprehensive ultimate truth contain fundamentally anti-democratic elements, where comprehensiveness means that they assert authority over issues involving the governance of human affairs and ultimate truth means that they appeal for authority not to human experience, science or public opinion but to established authority or privileged knowledge of the divine, and they reject accountability to publics and human institutions. Insofar as people believe that power is legitimated by divine authority, they will not be drawn toward liberal democracy.

There is indeed a global society: common values and common institutions are not geographically bounded and vision of a universal global society is a mirage. The global society in which we live is not universal: it does not include members of al-Qaeda, suicide bombers, or substantial elements of the populations of U.S. allies such as Saudi Arabia and Pakistan and it also excludes other fundamentalists who believe that as the “chosen people” they have special rights and privileges. People with these beliefs may belong to global societies of their own, but they do not belong to the same global society as do those of us who believe in liberal and democratic values. To genuinely belong to an open global society, one must accept others, with very different beliefs about ultimate truth and the good life, as participants, as long as they follow principles of reciprocity in accordance with fair procedural rules.

Even a universal global society would propose a challenge to global governance under the best of circumstances, and it would be difficult to implement a cosmopolitan vision, if globalization of public authority occurred, individual citizens would have few incentives to try to monitor governments’ behavior. Indeed, the larger the polity, the more individuals can rationally be ignorant, since each person’s actions have so little effect on policies and that is, the very size of a global polity would create immense incentive problems for voters – in mass election campaigns it would seem pointless to most voters to invest in acquiring information when one’s own vote would count, relatively speaking, for so little. It would also be hard, without political parties that operated on a global scale, or a coherent civil society, to aggregate interests and coherently articulate claims, even a universal global society would lack a strong civil society with robust communication patterns and strong feelings of solidarity with others in the society.

We see these difficulties in the European Union, which is a highly favorable situation, with common democratic values and democratic institutions such as the European Parliament. But the European Union remains largely a set of intergovernmental and supranational institutions supported by a pact among elites, without deep loyalty from the publics of member countries. Even after 45 years of the European Community, it lacks a broad sense of collective identity and mutual support. In the EU, political authority and forms of government have become “diffused”. As Anne-Marie Slaughter puts it, “disaggregating the State makes it possible to disaggregate sovereignty as well”.

10. Us Unilateralism:

US government has refused to pay its full dues to a number of international organizations. The United Nations has received the most attention in the press, but the US is also behind in payments to the International Monetary Fund, the World Bank, the Organization of American States, and a number of other international organizations. It has refused to join the great majority of other countries in creating an International Criminal Court. The treaty creating the court was signed by 138 countries and ratified by 66, but instead of ratifying the treaty the United States has nullified its signature which is the first time ever that a country has voided its signature on an international treaty. US has unilaterally withdrawn from major UN specialized agencies: the first was the United Nations Educational, Scientific and Cultural Organization (UNESCO), which it agreed to rejoin only in 2002, eighteen years after leaving it in 1984, and the second was the International Labour Organization (ILO), which it rejoined some years ago. United States has refused to join 130 other countries in a treaty banning the use of land mines. It has refused to implement the chemical weapons convention, on the grounds that it will not allow inspections on US territory. Inspection of other people’s territory is rightly regarded as essential in order to ensure compliance with the convention, but inspection of US territory is regarded as unacceptable. US has refused to ratify the comprehensive Nuclear Test Ban Treaty, even the US has refused to ratify the international agreement on “greenhouse gases” and join in a global effort to reduce transnational pollution. Support the Child Soldier Prevention Act of 2007. Of 10 governments worldwide implicated in the recruitment or use of children as soldiers, nine receive US military assistance. This type of behaviour is incompatible with creating a democratic order at the global level. It undermines world security, it inhibits the extension of the rule of law to the global level and it weakens the capacity for collective action to address pressing global problems. Within the narrow compass of economics, it is becoming increasingly evident that global economic governance requires a set of supranational institutions that are able to deal collectively with a range of transnational issues. For these purposes, what is needed is a combination of reform of existing international institutions and the creation of new supranational institutions.

11. Conclusion:

In the long run global governance will only be legitimate if there is a substantial measure of external accountability. Global governance can impose limits on powerful states and other powerful organizations, but it also helps the powerful, because they shape the terms of governance. In their own long-run self-interest, therefore, powerful states such as the United States should accept a measure of accountability – despite their inclinations to the contrary. As in 1776, Americans should display “a decent respect for the opinions of mankind.” Our principal task as scholars and citizens who believe in more accountability is to build support within our powerful, rich countries for acceptance of more effective and legitimate multilateral governance to achieve human purposes, for stronger transnational bonds of empathy, and for the increased external accountability that is likely to follow.

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