U.N. - REPORT OF THE SECRETARY-GENERAL ON
THE WORK OF THE ORGANIZATION - 1998

IV. Engaging with globalization

147. Defined in purely geographic terms, little is new about globalization. Interconnected human activity on a worldwide scale has existed for centuries. The form of contemporary globalization is new, however. The production of a single automobile model, for example, or global trading in a financial instrument, may be physically dispersed across many countries. Yet those dispersed activities function as if they were all in one place, they are connected in real time and they follow their own holistic logic - whether it is determined by a single corporate structure or by thousands of individual buy and sell orders on computer screens and telephones. Moreover, demographic momentum, together with patterns of land use and energy consumption, has always affected local and subregional ecosystems. Today these and other human factors increasingly affect the planet's ecology as a whole, be it through ozone depletion, global warming or diminishing biodiversity. Lastly, the technological advances and open borders that enable commercial firms to organize the production of goods and services transnationally also enable terrorist networks, criminal syndicates, drug traffickers and money launderers to project their reach across the globe.

148. These new dimensions of globalization can only be addressed multilaterally, by the United Nations and by other international institutions.

The economic dimension

149. In cooperation with other multilateral organizations, the United Nations has sought to strengthen normative, legal and institutional frameworks that will allow the global economy to operate more effectively and equitably. These frameworks are essential to ensuring stability and predictability and allowing all regions of the world, in particular the least developed countries, to benefit from the expansion of the global economy. The international economic policy agenda today is beset with complex problems that were unimaginable when the rules for managing the post-war economic order were written in the late 1940s.

150. During the past year the Asian financial crisis has intensified and now affects countries on every continent. It has exacted steep and possibly long-lasting social costs in East Asia, and raised serious concerns about the operations of unregulated financial markets. Those hardest hit by the crisis are the most vulnerable; and there is a real risk that many of the successes built up over the years in reducing poverty in the region will be reversed.

151. As far back as 1993, the United Nations World Economic Survey expressed concern that a number of developing countries had become hosts to large stocks of volatile funds. The Trade and Development Report, 1997 sounded a clear warning about the emerging situation in East Asia. Well before the onset of the crisis, the Economic and Social Commission for Asia and the Pacific (ESCAP) commissioned country studies to identify the strengths, weaknesses and remedial actions required to improve financial sector management. Possible responses to the crisis have been discussed at meetings organized by ESCAP in cooperation with the Asian Development Bank, the International Monetary Fund and the World Bank; and by the Department of Economic and Social Affairs in cooperation with the regional commissions.

152. At a special high-level meeting on 18 April 1998 the Economic and Social Council addressed means of preventing or, if preventive strategies failed, of containing the impact of such crises, and of achieving "international economic security" more broadly. Questions addressed at the meeting included the overall health and viability of the international financial sector, the relationship between borrowers and lenders, and how to achieve the key objectives of poverty eradication and development. The positive atmosphere of the debate reflected the interest of the participants in moving towards a more comprehensive approach to crisis avoidance than currently exists, and in strengthening the cooperation between the United Nations and the Bretton Woods institutions.

153. Looking beyond the immediate crisis, the Economic and Social Council devoted its 1998 high-level segment to market access in the context of globalization, and debated how developments since the Uruguay Round are affecting developing and least developed countries. In a ministerial communiqué - a first for the Council - it stressed the need for further efforts for trade liberalization through the World Trade Organization, coupled with the need to provide enhanced technical assistance to developing countries. In September 1998, the General Assembly will, for the first time, hold a high-level dialogue on the social and economic impact of globalization and interdependence and their policy implications.

The environmental dimension

154. International cooperation has a vital role to play in arresting and reversing the potentially harmful effects of human activities on the environment. The Commission on Sustainable Development and the newly strengthened United Nations Environment Programme are central to this effort.

155. The role of industry in creating sustainable development strategies has been of particular interest to the Commission this year. For the first time in a United Nations intergovernmental setting, the Commission convened a policy dialogue among Governments, the private sector, unions and civil society organizations on an equal footing. This led to an agreement to undertake a multi-stakeholder review of voluntary initiatives aimed at promoting environmentally and socially responsible business practices and investments. Such meetings will become a regular feature of the sessions of the Commission.

156. In June 1997, at its "Rio + 5" special session, the General Assembly had considered a study warning that, without preventive measures, two thirds of the world's population could face freshwater scarcity and water quality problems by the year 2025; in 1998, a series of international meetings sought to identify appropriate policy responses. On another front, the Commission's Intergovernmental Forum on Forests, at its first session in September 1997, adopted a three-year work programme, including consideration of a possible binding instrument for the sustainable development of forests and their resources.

157. A protocol to the United Nations Framework Convention on Climate Change was negotiated this past year. It specifies legally binding targets for greenhouse gas reduction by industrialized countries, and is a step towards managing major environmental problems attending globalization.

158. The United Nations also made significant headway in creating two new international legal instruments designed to ensure the safe management of hazardous chemicals that move across borders. The first involves persistent organic pollutants that bioaccumulate, possibly causing cancer, reproductive disorders, damage to central and peripheral nervous systems and diseases of the immune system, and interfering with infant and child development. UNEP initiated negotiations to prepare an international legally binding instrument to reduce the risks arising from the release of 12 such pollutants. The first session of the negotiating committee was held in June-July 1998.

159. The second instrument concerns trade in hazardous chemicals and pesticides. After two years of negotiations, the draft text of a legally binding instrument prescribing prior informed consent of such trading was concluded in March 1998. This will provide a means to acquire and disseminate information on this risk-prone form of trade and promote shared responsibility between exporting and importing countries. A diplomatic conference is to be held at Rotterdam, the Netherlands, in September 1998 to adopt the convention.

160. In collaboration with more than 200 scientists and an international team of reviewers, the World Meteorological Organization and UNEP jointly prepared an updated scientific assessment of ozone depletion. That assessment notes that, with full implementation of the Montreal Protocol on Substances that Deplete the Ozone Layer, the complete recovery of the Earth's protective ozone layer could occur by the middle of the next century. It also indicates that the combined total of all ozone-depleting compounds in the troposphere peaked in 1994, and is now slowly declining. Like its predecessor survey in 1994, this assessment provides the scientific consensus needed to guide international cooperation for the purpose of phasing out the use of substances that deplete the ozone layer.

161. In the area of biodiversity, the Open-ended Ad Hoc Working Group on Biosafety held three sessions during the past year to continue preparing the groundwork for negotiations on a biosafety protocol to the Convention on Biological Diversity. The Global Environment Facility has agreed to fund a major pilot project to be implemented by UNEP that will provide assistance on biosafety to developing and transitional countries.

162. Regional multilateral organizations continue to play an important environmental role. For example, the negotiating committee on persistent organic pollutants agreed to use protocols established by the Economic Commission for Europe (ECE) as a basis for worldwide action. Similarly, within the framework of ECE, an international agreement has just been adopted to develop global technical standards for motor vehicles, which should lead to the production of vehicles meeting high safety and environmental standards.

"Uncivil" society

163. The globalization of electronic communication is helping to create an embryonic global civil society, represented most obviously by the ever-increasing number of non-governmental organizations focusing on issues related to the environment, development, human rights and peace. The forces that made possible the emergence of a global civil society also, unfortunately, facilitate the transnationalization of "uncivil" elements.

164. In many countries, criminal organizations and drug- trafficking syndicates with transnational links represent a major threat to both Governments and peoples. In June 1998, the General Assembly held a special session to examine the global drug problem and related threats. It reached consensus that the most appropriate policy was a balanced approach to drug control, giving equal priority to reducing demand and reducing supply, and providing alternative crop opportunities to farmers growing drug-producing crops.

165. The operational follow-up to the special session will involve the key international financial institutions. It will also equip the United Nations International Drug Control Programme to assist countries in combating organized crime more effectively and in reducing the supply of illicit drugs. The Programme monitors and analyses changing drug traffic patterns, liaises with enforcement experts from other agencies and helps Governments to reinforce their border control and drug detection capacities. It has also developed a worldwide programme of training and technical assistance to increase awareness of money-laundering, encourage the adoption and enforcement of effective national laws and upgrade the skills of the police, prosecutors, judges and financial regulators and their ability to respond to the rapidly changing modalities of financial crime.

166. The Programme also maintains an Anti-Money- Laundering International Database; a world compendium of anti-money-laundering legislation and procedures, which is part of the International Money-Laundering Information Network; as well as a library and forum for information exchange among international organizations and other interested parties. UNDCP has also established a global system for sharing data with other international organizations involved in the fight against international crime. For example, its database is linked with Interpol and the World Customs Organization. At the regional level, the Programme brings together law enforcement authorities from neighbouring countries to discuss region-specific problems and ways to address them. In drug-producing countries, it works with Governments and rural communities to facilitate a transition to legal alternative crops and promotes sustainable agro-industrial sectors.

167. The General Assembly took important action this past year to strike at the threat of terrorism. In December 1997, it adopted the International Convention for the Suppression of Terrorist Bombings. The Sixth Committee will next take up consideration of an international convention for the suppression of acts of nuclear terrorism.

168. In this increasingly interconnected world, the forces for good and evil travel with equal speed and ease. Globalization has an immense potential to improve people's lives, but it can disrupt - and destroy - them as well. Those who do not accept its pervasive, all-encompassing ways are often left behind. It is our task to prevent this; to ensure that globalization leads to progress, prosperity and security for all. I intend that the United Nations shall lead this effort.

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