15th Annual Plenary Meeting

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Final Communiqué

1-4 June 1997

Noordwijk, The Netherlands

The Current Situation of the World

1. The world is currently undergoing a period of transition which requires creative and enlightened leadership, if we are to meet our responsibilities to promote justice, respect cultural diversity, and ensure the widest possible participation in the potential benefits that this will provide.

2. The world of tomorrow will be characterized by increasing interaction between diverse cultures and religions. For a peaceful development, it is vital to accept this spiritual dimension of a changing world and to promote harmony by learning to cherish and respect cultural and religious diversity as an enriching human experience.

3. In the light of the growing political and economic importance of economies outside the Euro-Atlantic area, the Council urges that Russia and China be admitted immediately as full participants in the G-7 and to full membership of the World Trade Organization (WTO). In addition, other major countries, as their impact on the world economy increases, should progressively be included as participants in these institutions.

4. The control and the reduction of armaments remain a primary concern.
Agreement on an international regime banning biological weapons, and reinforcement of the nuclear non-proliferation regime, as well as the adoption of a conventional arms treaty, is vitally important. In this respect, it is imperative that major powers curtail the sale of advanced weapons systems to developing countries, as such sales threaten to destabilize regional power balances. Military expenditure as a proportion of annual budgets should be reduced.

5. Subsequent to the admission of new members to NATO, the Western world should avoid further tensions in its relations with Russia.

Opportunities and Risks of Globalization

6. Globalization is a challenge that must be taken advantage of, not an alibi for inaction. It describes the extension of traditional patterns of economic activity to higher levels and the international spread of technology, production, finance, investment, and information. The dramatic advances in information technologies have had a considerable impact on the world-wide dispersion of production and on the intensification of international capital flows. (See the attached report of the Council’s Group of Experts.)

7. The open world economy has expanded to incorporate new participants from regions traditionally excluded from it. However, the Council stresses that certain regions, most noticeably sub-Saharan Africa, are becoming increasingly marginalized. Inadequate education, widespread health problems, excessive population growth and consequent low welfare levels, are preventing them from attracting the foreign investment necessary for development. Multilateral institutions have a vital role to play in creating an environment for such investments by fostering efficient government, legal reform, banking reform, the development of capital markets, and liberalization of trade.

8. The Council welcomes the new emphasis that the World Bank is placing now on faster rates of growth as a priority objective in the developing world. It is fully aware, however, that growth alone is not adequate. The Council emphasizes the need to alleviate poverty, promote family planning and improve educational standards, particularly for women. Towards this objective, it is important to reallocate expenditures by reducing military spending. It is also important to maintain Official Development Assistance (ODA) as an essential tool for promoting economic and social development.

9. Although five years after the Rio Summit some progress has been achieved, most general trends still point to further degradation of the human environment. We urge governments to live up to their commitments at the Rio Conference. More emphasis should be given to the role and responsibility of the private sector industries in adjusting production processes to the environmental demands.

10. The current terms of trade are unfair for many developing countries, particularly sub-Saharan states. There is a serious danger that such states will find themselves effectively excluded from the international trading system. In particular, given the fact that in such economies a high proportion of the population is employed in agriculture, the Council recommends that the developed states phase out the subsidies they currently provide to their agricultural sector. These subsidies and other trade barriers not only undermine developing economies but also represent a serious distortion within developed economies.

11. Competition from low wage economies must not be used as a scapegoat for domestic problems in industrialized countries. Protectionism is not a solution for these problems. Only if productivity levels are raised will the developed economies regain their competitiveness. Therefore, labor markets must become more flexible, and educational and vocational training capabilities must be improved. Governments need to provide both a safety net for those left unemployed in the adjustment period, and re-training opportunities to enable them to re-enter the job market. More generally, it is essential that these measures be placed into a broader context of the formation of a new model of industrial democracy, based on social justice and the fostering of consensus.

12. The financial markets have been transformed by globalization. Increasingly, national authorities are unable to control monetary conditions in their own economies. The scale of current international flows, the impact of speculative movements and the rapidity with which such movements take effect and spread across the globe, raise the danger of a serious dislocation occurring. Without strengthening coordination between the major economies, massive speculative capital movements are unavoidable, with all their negative consequences.

13. A single European currency, as envisaged by the Maastricht Treaty, will support a more stable equilibrium between the United States, Japan, and the European Union, if it can be assumed that these three monetary blocs will coordinate their policies. Whilst recognizing the difficulties involved, the Council reiterates its recommendation to explore the use of target zones of exchange rates.

14. A further area of concern is the growth in the trade of financial derivatives. Whilst such instruments perform a useful role, allowing traders and investors to avoid risks in financial markets, they can result in unacceptable losses when used improperly. As a matter of importance, non-bank financial institutions, especially those trading heavily in derivatives markets, should be brought under prudential supervision. Other areas which demand immediate attention are how far non-banks should be permitted to trade in derivatives, the requirement in law or by official rules of larger margins and the regulation of over-the-counter trade. Moreover, central banks have to strengthen and coordinate their supervisory role over risk management procedures by all banks and other financial institutions.

Towards a Universal Declaration of Human Responsibilities

15. In a world transformed by globalization, common ethical standards as a basis to live together have become an imperative, not only for individual behavior but also for corporations and political authorities.

16. Nearly 50 years ago, in the aftermath of World War II, and with the legacy of two defeated dictatorships, the General Assembly of the United Nations adopted the Universal Declaration on Human Rights to safeguard the individual from totalitarian repression. Half a century on, this Declaration is still far from being sufficiently observed in many parts of the world. Its full implementation remains a profound challenge to the international community.

17. The challenges posed by globalization require an effort comparable to that of 1948 --the formulation and adoption of a Universal Declaration of Human Responsibilities.

18. Over the past 10 years the InterAction Council has convened High-level Expert Groups, bringing together representatives of all the major religions and philosophies to identify, along with political leaders, common principles and shared ethical standards. Now the Council is preparing to initiate a broad based process to develop a Universal Declaration of Human Responsibilities. After careful consideration, the Council will present a preliminary draft as a basis for discussion and will invite all interested parties to communicate their views and comments. It is the intention of this Council to bring the revised draft to the attention of governments.

19. This process, as much as its hoped for result, will contribute to the promotion of mutual understanding, of affirmative tolerance based on the recognition of shared values, thereby proving that the threat of an imminent clash of civilizations can be avoided.