From Business Report / Independent Newspapers, South Africa / By Peter Galli
San Francisco - The failure of globalisation to effectively address the needs of developing countries was one of the main reasons behind South Africa's high unemployment rate and lack of foreign investment, President Thabo Mbeki said on Wednesday.
He was addressing several hundred businessmen and investors at the lavish Fairmont Hotel in San Francisco before heading off to the headquarters of software developer Oracle in Silicon Valley.
Mbeki was accompanied by Jeff Radebe, the minister of public enterprises, foreign affairs minister Nkosazana Dlamini-Zuma, trade and industry minister Alec Erwin, communications minister Ivy Matsepe-Casaburri and Sheila Sisulu, South Africa's ambassador to the US.
Globalisation had benefited the wealthy northern countries while doing nothing for poor nations in the south, he said, launching a stinging attack on the World Trade Organisation (WTO) which, he said, allowed developing countries to be disadvantaged by a lack of capital flows and the negative trade rules and regulations currently in place.
"There is little doubt that we all need to work together to overcome the challenge of development. This will require a massive resource transfer into developing countries and a broad-based development round at the WTO to address these issues. As developing countries we have to be recognised. We want to be part of the rule making process so that our needs can be recognised and addressed."
While developing countries had to take responsibility for growth, the trade and structural barriers that stood in the way of this had to go.
"We need better managed developmental assistance, and there has to be a major refocus in the way decisions are made about development. We also need to put in place a structure that can better facilitate the flows of investor funds into developing countries."
Developing countries were always being told that they needed to undertake economic and trade reforms to become more compatible with - and attractive to - the developed world. But this did not always help. Mbeki said South Africa's fundamentals were stable and sound, it had solid fiscal and monetary policies in place and had liberalised trade and reformed its tariffs.
"Yet, in spite of this, investment flows into South Africa have been disappointing, helping keep poverty and unemployment levels high.
"Many of us are punished by the development and trade structures in place, which benefit the wealthy countries that wrote them and continue to impact negatively on us."
On a more positive note, the president said that since arriving in the US on Sunday, he was more positive than ever that these challenges could be overcome.:
