by Nicola Bullard*
Kofi Annan's decision to cast his lot with the OECD, the IMF and the World Bank has thrown serious doubt on the UN's willingness to challenge the dominance of the institutions wholly owned and operated by the G7.
In his opening speech to the Geneva 2000 Forum on the eve of the UN General Assembly Special Session on Social Development (UNGASS) Mr Annan told the predominantly NGO audience that "people are poor not because of too much globalisation but too little." And, just to drive home the point, he added that private corporations are no less a part of civil society than NGOs; that the UN has made common cause not only with the World Bank and IMF but also with the OECD, and that if the Bretton Woods organisations, the OECD and the WTO "have pursued mistaken policies in the past, haven't we all at one time or another?"
And if anyone still believed that the UN could act as a counterweight to the Bretton Woods institutions after hearing Annan's speech, there was more to come: the UN's decision to co-sign a report launched for the UNGASS alongside the World Bank, the IMF and the OECD, the failure of the UNGASS to address the massive contradictions in the global economic and political system and, finally, the launching of the UN's 'Global Compact' with nearly fifty major transnational corporations.
"Bretton Woods for All"
The report that caused all the fuss 'A Better World for All' (and immediately dubbed 'A Bretton Woods for All') is little more than a glossy brochure indicating progress towards seven key international development targets. It is high on graphics and low on analysis. The content of the report is both superficial (one IMF economist said they were told it "had to be understood by high school students and government ministers") and predictable: very little progress has been made in the past five years, some countries have done better than others, and what we need is "faster, sustainable growth strategies that favour the poor."
Ho hum. In fact, the report is like so many other World Bank documents that it would barely have caused a ripple were it not for the fact that the Mr Annan's name appeared with Messrs. Johnston, Kohler and Wolfensohn (at least he was given alphabetical preference).
While UN staff tried to distance themselves from the report and the IMF stood by wondering what the fuss was all about, more than seventy UN-accredited NGOs demanded that the UN withdraw its endorsement of the report. The World Council of Churches was even tougher. In a public letter, WCC general secretary Dr Konrad Raiser accused Mr Annan of being party to a "propaganda exercise for international financial institutions whose policies are widely held to be at the root of many of the grave social problems facing the poor." He added that "considerable damage has been done to the credibility of the UN as the last real hope of the victims of globalisation."
Social Summit is downhill all the way
The UN Special Session itself was cold comfort to the "victims of globalisation." The assessment of progress since the first social summit in Copenhagen five years ago was grim: the overall number of people living in statistical poverty has increased and in at least 30 countries the situation has gone backwards, including countries such as Thailand which had made tremendous progress in the previous decade.
And we should not expect much more in the next five years. When asked to list the achievements of the meeting, UN under-secretary Nitin Desai put setting a deadline to "halve the numbers living in extreme poverty by 2015" at the top of his list, yet there are no binding commitments and no new resources. If this it the measure of success, perhaps the rest can be judged a failure.
In the details, however, there were some small gains. The paragraph 111(e) bis on "developing new and innovative sources of funding" opens the door for further discussions on currency transactions taxes (a Tobin Tax) and, even more significantly, the declaration contains two paragraphs (10 and 10[bis]) which legitimise both debtor moratorium (debt standstill) and capital controls.
But the striking characteristic of the official event was its lack of vision. Delegates were dispirited, knowing that these negotiations were being made in the context of an unprecedented global crisis. The governments and international institutions responsible for development have lost their legitimacy, uncontrolled and volatile financial markets threaten economic, political and social progress, and inter and intra country relations are marked by deep and destabilising power imbalances. The international political and economic system is in crisis, yet no one dares grasp the nettle of globalisation and name its contradictions and failures. All we get is "globalisation with a human face."
Corporations with a human face
Under the banner of the UN, fifty top transnational corporations (including Shell, Nike and Novartis) have signed on to a charter of nine principles covering human rights, workers rights and the environment. Each year they will be asked to post (on a website of course) examples of their progress in these areas. International NGOs such as Amnesty International, the ICFTU, World Wide Fund for Nature and Human Rights Watch will then respond (also via the website) thus creating a "structured dialogue" between corporations and labour and human rights groups which could be a "powerful force for change." (A list of supporting corporations and international NGOs can be found at www.coprwatch.org/trac/globalization/un)
The compact was denounced by intellectuals, progressive activists and NGO leaders, including many from the South. Their letter to Kofi Annan (available on the same website) challenges the assumption that markets have a central role and criticizes the non-binding nature of the compact, saying that "many corporations would like nothing better than to wrap themselves in the flag of the United Nations to 'bluewash' their public image."
Although progressive groups and some Third World governments have expressed grave concerns at the UN's direction, these are not simply public relations blunders. The UN is systematically realigning itself to the corporate sector, the US and the Bretton Woods institutions. Given that UN's agenda, language and programmes have already been hijacked by the World Bank, the IMF and the WTO, those at the top have made the pragmatic choice: "if you can't beat them, join them."
G7 fails (again)
At their 26th Summit in Okinawa, the G7 again provided ample evidence of their staggering capacity to waste money ($750 million) and create the illusion of purposeful action while doing absolutely nothing.
Their final communique includes meaningless statements on almost every safe issue. For example, the section on information technology: "IT empowers, benefits and links people all over the world, allows global citizens to express themselves and know and respect one another... [it] enhances public welfare, promotes stronger cohesion and thus allows democracy to flourish." In fact, the qualities they attribute to IT read like the label on a jar of snake oil, which promises to cure everything from hair loss to peptic ulcers. Don't they read the Financial Times? Don't they see the headlines of mega-mergers between mobile phone companies, the astronomical bids for broadband licences and the soaring price of IT stocks? All this activity is based on future expected profits and it seems extremely unlikely (and even na๏ve) to imagine that the benefits of this technology will be shared with anyone who can't afford the market price.
On debt, the G7 failed completely. The Jubilee 2000 campaigns which last year were prepared to take a chance with the Enhanced HIPC Initiative have now denounced it as a "tool for delaying debt cancellation." In their strongest statement to date, an extremely broad base of Jubilee campaigns demanded the cancellation of illegitimate and unpayable debt, delinking structural adjustment and other conditions from debt cancellation, and that the G7 cease to function as "judge, jury and party" in the debt cancellation process. They also pledged to take their message to the IMF and World Bank meetings in Prague.
The Economist's assessment of the G7 summit ('Global economic summit promises much and delivers nothing,' 29 July) concludes by asking "How about abandoning this sorry exercise altogether?" It's not often that we agree with The Economist, but what an altogether excellent idea!
* Nicola Bullard is the deputy director of Focus on the Global South