In the 1999 edition of its annual Human Development Report, theUnited Nations Development Programme (UNDP) put forward a simple, but powerful, idea: thewave of economic globalization currently under way in the world offers great opportunitiesfor human advancement, but only if international governance is improved at the same time.

Contrary to what its critics sometimes claim, globalization is not a "policy"adopted by governments. It is an unavoidable fact, a torrent in which we are all caughtup. It brings opportunities but also serious risks, especially for developing countries.The opportunities are distributed unequally, as is access to the information andtechnology on which the globalization process itself depends. New threats are created tohuman security and the quality of life, and traditional systems of social protection areput at risk, from those in the family to those provided by the state.

Hence the importance of good international governance. By this is meant the rules,institutions and practices which lay down limits for behaviour by individuals,organizations and companies. Policies and rules of the game are needed which channelglobalization and prevent its negative forces from swamping the opportunities it offers.In this respect, the international agenda is seriously incomplete.

Obviously, there have been achievements. The greatest of these are the Charters onhuman, social and cultural rights approved at the UN and the declarations and plans ofaction adopted at the Organization's great international summits on such matters. Butthe same cannot be said of the main international negotiations to put these decisions intopractice.

Here, as the UNDP points out, purely economic matters tend to win out over broaderhuman development concerns. But even the economic agenda itself is insufficient, dominatedby topics such as free trade and capital movement, legal protection for intellectualproperty and investment. Others of equal importance are left out, such as theinternational mobility of labour or agreements to guarantee adequate taxation of capital,including measures against evasion. Accords also are needed on how to mobilize financialresources to compensate countries left aside by the dynamics of globalization. And, as theUNDP says, we need worldwide antimonopoly norms and a code of conduct for multinationalcompanies.

At no time in the last few years has the lack of governance been so evident as over theissue of capital flows. The international financial crisis which hit the developing world,from Asia to Brazil, between mid-1997 and early 1999, made this especially clear.

The crisis did produce some positive responses. The most important of these was theconcerted effort at monetary expansion, lead by the United States. This was perhaps themain factor behind the subsequent normalization of the international capital markets. Alsowelcome were the fresh IMF credit lines set up and the beginning of procedures aimed atimproving prudential regulation and supervision of financial systems and the informationthey manage.

But the very normalization of the markets has lead to complacency. The danger now isthat this will not only put a brake on these positive trends, but prevent other vitallyneeded measures being carried out.

International mechanisms need to be set up to allow consultation over macroeconomicpolicies and to regulate capital flows, while defending the autonomy of developingcountries to manage their own affairs in these areas. New conditionality rules should bedesigned giving fair access to crisis contingency funds and multilateral development bankresources. International regulations are necessary for agreed standstills of debtservicing and orderly renegotiation of over-indebted countries' external liabilities.There is an urgent need for early-warning systems before crises strike and effective meansto protect vulnerable social sectors when they do.

We also need international means of managing globalization which are not only morecoherent than at present, but more democratic. One of the main deficiencies of theexisting system, without a doubt, is the inadequate representation of developingcountries. Current negotiations on financial reform has made this quite clear.

But beyond all this, any system which is eventually worked out must answer two keyquestions: What weight should be given to worldwide international institutions vis-à-visthose of a regional or subregional character? And how much autonomy should be given tonational policies?

In response to the first question, adequate international representation for developingcountries - and, indeed, the very commitment of these nations to the new internationalrules of the game - is going to depend on whether regional and subregional institutionsare given an adequate role. Rather than a few worldwide institutions, we need networks ofinstitutions which include those of a regional and subregional nature.

As for the second question, so long as nation states continue to provide the context inwhich political democracy operates, any international system must allow sufficient roomfor national autonomy, so that democratic processes in each country can establish thesocial and economic institutions which each nation sees fit and the mix of macroeconomicpolicies which it considers most appropriate.