Forged in the eighties and nineties, it is focused on sound macro-economic management reflected by exchange rate adjustment, fiscal rectitude, debt rescheduling and reduction, trade liberalisation and privatisation. The GATT Agreement of the Uruguay Round and the creation of the WTO enshrined the free trade outlook. The holy trinity of fiscal balance, trade balance and exchange rate balance became essential goals for all. But recent lessons in East Asia and the rising inequities being felt in many parts of the world underline that this model requires further refinement. In addition, the qualitatively different reality of the emerging power of the global capital markets and the vulnerability of national economies to international competition has both good and bad aspects.
Globalisation is desirable, but so is caring for the vulnerable and the weak.
To respond to shocks and make effective use of new opportunities, governments must undertake effective action in some key areas. The costs of inflation and over regulation tend to be felt above all by the poor. The future will require more access to open communications and information at a speed that will defy our current thinking . The future is going to be a knowledge-based society, one that will require continuously upgraded skills. This means that education and health and nutrition of persons are a primary competitive asset as well as being the best investment that societies can make.