The greatest human pride is the pride of wealth of knowledge, and its prudent integration with intellectual integrity is the essential ingredient of global integration.
The world Bank President Mr. James D. Wolfensohn once stated: “…searing images of desperation, hopelessness and decline- of people who once had hope, but have no more: Today, while we talk of financial crisis, 17 million Indonesians have fallen back into poverty; and across the region a million children will now not return to school. Today while we talk of financial crisis- an estimated 40% of the Russian population now lives in poverty! Across the world 1.3 billion people live on less than $1 a day; 3 billion live under $2 a day; 1.3 billion have no access to clean water; 3 billion have no access to sanitation; 2 billion have no access to power. We talk of financial crisis while in Jakarta, in Moscow, in Sub-Saharan Africa, in the slums of India and the barrios of Latin America, the human pain of poverty us all around us.”
Despite such issues, however, the world financial institutions are moving towards, perhaps, one world - one world polity, one world economy and one world social system. This appears to be a cry in the wilderness! On retirement, the Chief Economist of the World Bank, Prof. Joseph Asangler, recently criticsed the world financial institutions experts. Among others, he said that they comprised of third class students from the first class universities who cannot find jobs anywhere else. Their expertise lay in preparing reports in the setting of the 5 star hotels, quite ignorant of the lives in villages and towns and deprivation of the people at large.
According to the World Bank’s own reports the world financial institutions recipe has failed a large majority of cases. Additionally, it is socio-economic deprivation, which has always led to socio-political instability and vice versa. Their suggestions to do away with the industry with no competitive advantage in a polity based on just economic rather than political social and economic gains, obviously, is misdirected. In fact this seems to be of their own making i.e. to help create the competitive advantage in the larger interest of those riving in any part of the developed or the under developed world. A recent recommendation oft repeated, for closure in Pakistan of a number of industries, including steel fertiliser, sugar, refining chemicals and automobile engineering, leaving only the cement and textile (also dependent upon subsidies), is mind boggling. If such a recommendation is accepted there would be no industry left in this country. There will there be less employment avenues and then much less availability of ordinary goods and services. It will confine us to producing raw materials only as if for the East India company under the British rule. Such a proposal will lead to the closure of thousands of units having billions invested, employing hundreds of thousands of people. Whose loss and whose gain will it be?
One must recognise that these very world financial regulatory institutions are being questioned, both in the developed and the developing world. Only the reasons are different. The recent demonstration against World Bank and IMF at Washington and earlier at Davos in Switzerland, Bangkok in Thailand and Calcutta in India against WTO, several others against ADB, latest being in Thailand, for different factors by the developed and the developing countries is testimony to this fact. The world emphasis on environment, labour, under or over-employment and subsidies must have relevance to the genius of country to country. Generally these policies have led to deficit finance, trade imbalance, inflation and devaluation of currencies.
Many a country have dovetailed their national priorities with the world economic initiatives of globalisation quite in disregard of their emphasis to the contrary. This includes such countries as Japan, France, India and Malaysia. Pakistan may follow suit in disregard to such moves as have not stood the test of time for the national priorities which most countries including India have, in fact, been following from the very inception. Pakistan must exercise due diligence and prudence in the harmonisation of the globalisation initiative with their national priorities in whatever manner.
What in fact has happened is, that whereas the world organisations have relied more on the text book theories, with strong emphasis on human rights including those of women and child labour, health care, education and availability of pure drinking water, it has missed the real issues for economic growth in real terms in a real world. They have failed to narrow the gap between the sick and the poor countries. They have made no effort to open up the markets equally for each country. Whereas, these institutions aimed to provide the poor with fish to eat, they never taught them how to catch the fish! In general, developing nations have had a continuing problem of a shortage of capital. They have had no adequate industry, no adequate technology and not much of a value added trade in the real sense.
The solution thus would lie in integration of the economies of the developing world, starved of capital, value added trade and industry, with those of the developed world. The salvation of any country lies in the adequacy of capital and growth through value added trade and industry. It is industry which produces goods, develops the know-how, generates employment as an antidote to deficit financing trade imbalance and inflation from which the economies of all these developing countries generally suffer. Industry cannot work without capital and technology - financial capital, correlated with intellectual capital.
The rich and poor countries, therefore, must address those issues on a priority bases and find new avenues of mutual growth and progress for all economies of the world whether these people live in the East or West, in America, Europe, Russia, Latin America or Asia. It is the integration of the world economy, in the short and the long run, which will help economic growth become conducive to peace and prosperity of the people living anywhere in the world. According to Wolfensohn, the World Bank President: “We have learned that local ownership and involvement must be central to our architecture.” It is through the commonality of interests of the people at large that future peace, prosperity and growth of the world economy can be achieved.