Globalization has generated an unprecedented surge in prosperity. The consequences have been sobering - absolute declines in GDP, increased poverty, hunger, human rights abuses and violent social unrest. Globalization puts a premium on good governance, and it can help devolve economic power from repressive regimes while creating the social space for the emergence of a thriving middle class and a robust civil society. On the other hand, it reduces the ability of Governments to deploy policy instruments free of external constraint and can thereby limit their capacity to help those most in need at home and abroad. The fact that globalization has these complex and potentially volatile consequences should occasion no surprise.
Markets are purely instrumental means for the efficient allocation of resources.
Whereas markets have become global, Governments remain local, however, and in key respects the capability gap between them is widening. Multilateral institutions have a critical role to play in bridging this gap. Only universal organizations like the United Nations have the scope and legitimacy to generate the principles, norms and rules that are essential if globalization is to benefit everyone. The task ahead, therefore, is not to try to reverse globalization - an effort which, in any case, would be futile. The task is to harness its positive potential while managing its adverse effects.