Uncontrolled globalisation produces disposable workers

Erkki Tuomioja, the Foreign Minister, regards globalisation in itself as a positive development. The integration and the broadening of markets has led to a more efficient use of resources and an increased level of welfare in the world. The Foreign Minister is of the opinion that the significant development, which has been experienced in the larger part of the world, and first and foremost in Asia, is of huge importance. Hundreds of millions of people have been relieved of the threat of starvation, a threat which was very real a mere couple of decades ago.

Mr Tuomioja also regards it as being only right that the focus of global growth will be transferred to the developing countries. Everyone will still be able to reap the benefits. He is pleased with the skill which Finland has exercised in maintaining its competitiveness and with its involvement in industries such as the new technology. These elements have been vital to the survival of Finnish industry and commerce.

Uncontrolled development may, however, be seen as a negative element of globalisation. There has been a lowering of the level of democratic decision making by the nation state and a lessening of the controls imposed, for example on the use of profits in order to safeguard the maintenance of welfare services. Herein lie real dangers, for which solutions must be found.

No long term investment in people

Globalisation must be held under control, says Mr Tuomioja. Democracy and the welfare state are still preferred by a majority of the people. If however this is not supported by market forces, the taxation base may start eroding. The free movement of capital and of people, and thus the sources of tax revenue, will make it more difficult to maintain the taxation base and consequently the welfare society. Another factor which makes it essential to control globalisation is the change which is currently taking place in the job market, due to the rapid growth and development of information technology. At the present time an exceptionally high percentage of both people and jobs are under a threat of redundancy.

Some years ago, those who had been made redundant could fairly quickly find a new job. People moved from the rural areas into the towns, where new jobs became available as industrialisation spread. Today, however, when a factory in one of the traditional core industries is closed, those losing their jobs cannot simply take up work in the information technology sector. Redundancy today brings a much harder blow. No longer is there any will to invest in people. Workers have become disposable items. Long-term investment, which has traditionally, even amongst shareholders, been characteristic of European and Japanese capitalism - in contrast to the USA - is now being eroded, says Mr Tuomioja.

Non-governmental organisations bear an influence on companies

With the advance of globalisation further rules of play become necessary. The Foreign Minister is of the opinion that the substance of these should now be debated. Active control of globalisation could mean, for example, that the WTO would not be opposed, and its activities would instead be improved and further developed. Sufficiently strong social guarantees, and provision for their implementation, clauses on human rights, environmental guarantees, among other things, should be covered by these rules of play.

Mr Tuomioja comments on the ethical principles of companies by saying: 'There is enough of a Leninist in me to believe in the forces of goodness but to prefer control.' Ethical rules of play are important, of course. Globalisation, on the level of the nation state, has meant that society and the consumer have reacted more acutely, and more quickly, to unethical operations. This is a fact which companies must take into consideration, even in the absence of international agreements. Non-governmental organisations may thus exert real influence.