Oleh/By : DATO SERI DR MAHATHIR BIN MOHAMAD
Tempat/Venue : TOKYO, JAPAN
Tarikh/Date : 07-06-2001
Tajuk/Title : THE U THANT DISTINGUISHED
LECTURE SERIES
Versi : ENGLISH
Penyampai : PM
" GLOBALISATION, GLOBAL COMMUNITY AND THE UNITED
NATIONS "
Globalisation is today's flavour. However it has
turned sour even before it has been tasted by the
majority of the peoples and the countries of the world.
It is very unfortunate of course, because it had held
out so much hope for a better and more equitable world,
a world free of poverty, a world of caring and sharing
between rich and poor.
2. Why has globalisation turned sour so quickly? Why
are so many people protesting and demonstrating? Why
are the poor who are supposed to be a beneficiary, if
not the main beneficiary, so reluctant to accept it?
Why are they stalling, unwilling to hold the next round
of WTO talks? Is it globalisation or is it something
else that has incurred their displeasure and their
fear?
3. If we care to look we will find that it is not
globalisation per se. It is what accompanies
globalisation that creates fear and negative reactions.
4. Globalisation is presently made synonymous with
and exclusively about a totally free unregulated world
market. It is absolutely tied to total deregulation
within countries and between countries. The free
market must be totally free and totally unregulated.
Governments must not only step back but Governments
must be completely deprived of any right or power to
oversee the market. In other words where free trade is
concerned good governance means no governance.
5. The market it is claimed will regulate itself.
Indeed it will do more than that, it will discipline
Governments. This last assertion was made by the Great
Currency Trader, George Soros. In South Korea he made
the claim that trading in currencies and devaluing them
is an exercise in disciplining Governments. One can
see in one's mind this great trader, whip in hand
making Governments jump through a hoop, disciplining
and training them so as to make them govern properly.
6. It is strange for a world dedicated to democracy
to advocate the disciplining of popularly elected
Governments by a foreign currency trader. But
apparently the claim is believed to be logical, right
because the world's media immediately quoted the wise
words of this great sage.
7. It is a measure of the dominance of Capitalism
that such an absurd claim can be made and accepted.
The market is a great place where exchanges and trade
contribute much to the creation of wealth. But the
market is about making profits, maximum profit. An
unfettered, a deregulated market can only lead to
avaricious profiteering to the maximum level. It is
absurd to think of the market caring about good
governance of nations.
8. We have seen during the currency crisis the
currency traders destroying the economies of whole
regions in order to make money for themselves. They
will deny this of course. They will say that it was
the corrupt, opaque, cronistic Governments which
destroyed the economies of their countries. But before
July 1997 the same Governments were developing their
countries so fast that they became miracle economies,
tiger economies, dragons etc. They could not have been
suddenly corrupt in July 1997, all these Asian tigers.
They must have been bad Governments for a very long
time. Yet they were apparently able to govern their
countries well enough to make economic tigers of them.
9. No. The claim that it was due to bad governance
by corrupt Governments does not hold water. That it
was due to the currency traders and their currency
trading and manipulation is more logical because the
great Asian Currency Crisis happened immediately after
the currency traders appeared on the scene. They, and
their media talked incessantly about the imminent
collapse of the economy that it became a self-
fulfilling prediction. Capital stopped flowing in and
banks, international banks, scared themselves into not
lending. Short-term investors pulled out.
10. Then the currency traders began to dump the
currency on the market. In vain the Central Banks
tried to mop up the excess money. The Central Banks
could only use the cash they held. They were fighting
against fund managers who could leverage their funds by
10, 20 or even 100 times. And predictably the Central
Banks lost and the currencies and the economies went
into a tailspin.
11. Suddenly the tigers lost their teeth and their
claws. A picturesque statement but what actually
happened was that the economies collapsed, millions of
workers were thrown on the streets. There they rioted,
burning shops, raping and killing innocent people. The
IMF moved in and in a situation where people had
already lost their income, the Governments were forced
to withdraw food and fuel subsidies, increase interest
rates and taxes, reduce Government spending and
generally display a most uncaring attitude. The riots
escalated and the Governments were overthrown, the same
Governments which had before so enriched the countries
that they became economic miracles.
12. Why did all these happen? They happened because
of this absurd notion that markets can regulate
themselves and even discipline Governments. Markets
only care for profit, for the maximum profits. In
Southeast Asia in order for the market to maximise
profits it was prepared to destroy whole economies, and
countries and people, mostly the poorest people, the
workers. In Malaysia short-term capital pull-out
caused the stock market index to plunge to around 260
from 1000. Market capitalisation was reduced by 200
billion US Dollar. Businesses collapsed and margin
calls could not be met. And banks were on the verge of
collapse unable to carry the huge non-performing loans.
13. All that happened in Malaysia, in Southeast Asia
and in East Asia were due to the operations of the free
market. Yes, we will admit that the Governments of
these countries were not the best Governments in the
world. There was corruption, there was cronyism, there
was poor transparency. All these needed to be
corrected. But must whole countries and economies be
totally destroyed in order to carry out the
corrections? Is there no other way, more humane way?
Cannot we take up a little bit more time, preserving
the economy as much as possible while we make the
necessary corrections?
14. If this was how currency traders discipline
Governments and if this is what the free market holds
for us, is there any reason why we should welcome it?
15. But globalisation is not necessarily designed
exclusively for the free totally unregulated market.
Globalisation by definition is about the globe, the
world as a single entity, not divided up into many
countries with closed borders. We must admit that the
difficulties and hassles about crossing borders stifle
economic interaction, the free flow of expertise and
wealth-creating capital. The answer is not necessarily
the destruction of borders. We can achieve the same
purpose by simply agreeing to lower the borders in
parts, for capital to flow in, even to provide
incentives for capital inflows.
16. That was what Malaysia did. We encouraged capital
inflows by incentives and reducing bureaucratic
hassles, by being business friendly, by catering to the
needs of the investors as much as possible. We
succeeded very well and we were enriched by the foreign
capital inflows long before FDI became an acronym for
Foreign Direct Investments. But we did not take down
our borders completely. We did not find it necessary.
As a result domestic businesses were able to thrive and
in time we were able to compete, to invest ourselves
and to export our own indigenous products, earning
better incomes for the country.
17. We felt we were very much a part of the world. We
benefited from the engines of growth provided by the
rich countries and the rich benefited from the lower
costs and the skills of our workers. It benefited
everyone, this gentle and selective lowering of our
border walls. And we could have gone on benefiting
everyone with our way, our selective lowering of our
borders.
18. I don't really think the advocates of a borderless
world truly subscribe to it. If they do then they
wouldn't be so discriminating, demanding for
borderlessness only for capital to flow in and out. If
we are truly borderless then people too should be able
to flow in and out of countries freely. The millions
of poor people in Africa, Asia and Latin America should
be able to migrate to rich countries when they can
contribute towards the lowering of costs while making
hardly a dent in the pockets of the rich. But the
vigorous advocates of a borderless globalised world are
very emphatic that the borders should come down only
for capital. In Malaysia and in every country the poor
very often migrate from their part of the country to
the rich urban and industrial areas. They create
problems of course. But since they are as much
citizens as everyone else they have a right to migrate.
19. In a truly globalised world where there are no
borders it is reasonable to expect the poor to migrate
to the rich countries. After all the rich can make
money in the poor countries, why cannot the poor make
money in the rich countries? Isn't it fair? But no.
No way will globalisation permit a free flow of workers
from one part of the globe to another.
20. It is the same old double standards. Tails I win,
Heads you lose. Globalisation at this moment is not a
win-win game. It is about the winners continuing to
win and the losers continuing to lose.
21. But if globalisation now is so one-sided, cannot
we make it less one-sided? We need not reject
globalisation but need we accept the fellow travellers,
the free unregulated market and the others? Must we
unequivocally accept that globalisation is free market
and free market is globalisation?
22. The answer must surely be it is not. We can have
globalisation without a totally free market, without
total deregularisation, without the abdication of
Governments as the overseer and the regulator.
23. Let us take currency trading again. Must it be a
part of globalisation? Obviously not. We can still
have world trade without the currency traders. Indeed
we can still have world trade with fixed exchange
rates. That was what the Bretton Woods was all about,
the fixing of exchange rates.
24. In the immediate post-war years and for a
considerable period of time the fixed exchange rates of
Bretton Woods brought stability to countries and to
their trade relations with each other. And the world
made a rapid recovery from the trauma of World War II.
By comparison recovery from World War I was irregular
and unequal. Defeated Germany suffered the most severe
recession and the Mark was rendered practically
useless. It left such bitter resentment among the
Germans that they became ready to accept Hitler and his
mad ambitions. Millions died as a result -- the result
partly at least of an exchange rate that was not fixed.
25. So what is wrong about a fixed exchange rate in a
globalised world? Malaysia fixed its exchange rate to
counter the manipulations of the currency traders and
to stop the slide of the country to bankruptcy. There
were all sorts of dire prediction. Malaysia's economy
would collapse totally. It will be a world pariah,
shunned by all investors. It would be forced to go
begging bowl in hand for help.
26. Well, nothing of that sort has happened. We have
recovered fully. In 2000 we grew by 8.5 percent. This
year growth will be much lower but it is not due to
capital controls or fixed exchange rates. It is due to
the failure of the U.S. economy which takes up 20
percent of Malaysia's exports.
27. A mechanism for fixing exchange rates can be
developed in order to enable a regulated devaluation of
the currencies of weak economies and revaluation of the
strong. Surely the great economists and financial
experts of the world can come up with a good mechanism
that will largely avoid economic turmoil.
28. The borders may be brought down so that the world
can be more global. But we can be selective in terms
of trade items, in terms of time, and in terms of
scale. There is really no need to bring down borders
for everything and everyone at a fixed time, nor should
there be zero duty for everything. Yes there are
provisions for these in the WTO agreements but they are
not good enough. The pressure is always to open up, to
let capital in and out and to profit from capital
movements rather than from long-term productive
investments.
29. We don't need giants and oligopolies or monopolies
in order to benefit from their economies of scale.
Organisations which are too big lose their efficiency,
they become arrogant and will not care about the side
effects of whatever they do. They will simply ride
roughshod over everything. And the world will be the
losers.
30. There should therefore be big and small
corporations and banks which can operate both
nationally or internationally. The small must be
protected to a certain extent, given the same kind of
handicaps that golfers are familiar with so that not
only will the playing field be level but the disparity
in the sizes of the players will be compensated.
Governments must be allowed to admit or reject the
super corporations and banks access to their countries.
But they must justify this.
31. There was a time when huge corporations were
forced to break up. Rockefeller's Mobil Oil monopoly
of the oil business in the U.S. brought on the anti-
monopoly Anti-Trust Laws. After the Second World War
the big German corporations and the Japanese Zaibatsu
were broken up. Bell Telephone Company in the U.S. was
also broken up.
32. Each of these offsprings then grew into huge
corporations, bigger than their parents. But now they
are merging again and becoming even bigger. The merged
companies are merging and merging until they are
actually bigger and financially more powerful than the
Governments of most countries. Even the most powerful
Governments of the powerful countries are afraid of
them.
33. These corporations have now decided on their own
to limit the number of corporations to be allowed in
any industry throughout the world. In the automotive
industry there will be only five or less. The same
will apply to the banking industry and other
industries. There is no guarantee that these
oligopolies will not merge further until they become
monopolies. There is also no guarantee that they will
confine themselves to particular industries and not
diversify and merge with the other giants.
34. Perhaps I am being a scaremonger. But then when
we became independent only 43 years ago, Malaysia had
looked at its borders as a legitimate protective
barrier behind which to manage its economy. If
somebody had told us at that time that we would lose
the protection afforded by our borders a few decades
later we would have considered him a scaremonger. But
today we are being told that borders are pass ,
anachronistic. There is going to be one world, one
borderless world. We cannot use our borders to protect
ourselves anymore. How can we be sure that in this
globalised borderless world, the giant banks and
corporations would not rule the world, would not
destroy us?
35. When, after a very destructive world war, the
nations of this world decided to try again for
international cooperation and global governance, great
hopes were raised. The United Nations, a new kind of
League of Nations, would ensure peace for the world.
It would also free the colonies of the Imperial
Nations. We therefore welcomed it and as a result
Malaysia and many other colonies of the European
nations gained independence because of it.
36. We thought that independence meant the right to
rule and manage our country freely and independently.
But we soon found out that independence did not imply
freedom. It was President Sukarno of Indonesia who
recognised the new form of colonialism which he called
Neo-Colonialism. We thought he was a crank but now we
know that he was omniscient, he saw far into the
future.
37. Today the United Nations is not the institution
that we had expected it to be. The belief that the
great powers who had been given veto rights would
exercise that right for the good of all has not been
borne out. Today the veto is often used to uphold
wrong-doings.
38. Under the aegis of the United Nations the World
Trade Organisation was formed. There we thought we
could hammer out a free trade system that will be fair
to all. But we are finding that it is an instrument
for forcing upon the world the policies of the rich,
designed to enrich the rich further.
39. The small countries are helpless as many are
beholden to the rich, forced to toe the line on pain of
losing aid or loans or other kinds of patronage. They
are deeply divided and they come to the negotiating
table with puny delegations to argue complex issues
with the huge highly knowledgeable delegations of the
rich backed by experts on call at home. They are faced
with an agenda not determined by them. Some of these
countries had earlier received delegations from the
rich intended to soften their stands. Always there is
a threat that money would be denied.
40. The WTO is not about fair trade. It is about
forcing down the throats of the unwilling the ideas of
the rich to help enrich themselves further. In the WTO
globalisation and the borderless world would not only
be promoted but would be imposed.
41. While we hear of the virtues of democracy for our
countries we see a total lack of democracy in
international affairs. In the United Nations and
elsewhere the powerful will take what they want and the
weak will surrender what they must.
42. It is a sad commentary on the state of the world
civilisation in this the 21st Century, the third
Millennium. Might it seems is still right. We have
not progressed very far since the first caveman
bludgeoned his rival and grabbed his wife. Until there
is reform to the United Nations system this primitive
state of affairs is going to continue. Certainly it
will in so far as world trade is concerned, in so far
as currency manipulation is concerned.
43. This is a talk on Globalisation, the Global
Community and the United Nations. I wish I could say
some nice things. But I find it very difficult to say
anything complimentary because I see injustice done to
my country at every turn simply because we try to
exercise the democratic right of free speech and
minority right. If we want to see a better world then
the rich and the powerful must learn to restrain
themselves to listen to the contrary views of the poor
and the weak and to seriously consider them and to be
prepared to make little sacrifices. Greed must be
curbed because it will destroy all of us. There is
still a place for charity of thoughts and action.
44. I am grateful to the United Nations University for
giving me this opportunity of being heard here. I know
that I will be totally ignored by those who control the
information that the world gets. I know I will be
vilified as a heretic. But I believe that I have as
much right to free speech as they have. And here I
claim my right.
Sumber : Pejabat Perdana Menteri
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