The advance of economic globalization should improve the life of people in developing countries and bring about sustainable development, according to Carlos A. Magarinos, director general of the United Nations Industrial Development Organization.
In his keynote speech at a recent UNIDO Forum in Tokyo, supported by The Japan Times, Magarinos called for the realization of a competitive economy that generates jobs and preserves the environment, with the private sector playing a greater role.
His view was shared by many other participants at the forum, held last week to commemorate the 20th anniversary of the establishment of the UNIDO Investment and Technology Promotion Office, Tokyo, which assists private firms investing in developing countries.
About 200 people, including scholars and government officials, attended the forum to discuss the issue of sustainable industrial development and the role of UNIDO and Japan in the process.
While acknowledging concern over the adverse effects of industrialization, Magarinos said trade, investment and technology transfers are vital tools in achieving sustainable economic growth in developing countries.
“Investment, trade and technology have to play their part in order to reconnect national economies with the global economy through a dynamic private sector,” he said.
He noted that interactions between trade and investment have been growing as multinational companies are increasingly “trading to invest and investing to trade.”
Trade and investment will facilitate technology transfers, which in turn can play a central role in promoting progress in developing countries and closing the income gap between rich and poor.
UNIDO, a Vienna-based U.N. special agency commissioned to help developing countries realize sustainable industrial development, has been especially promoting the transfer of information technology and biotechnology.
IT can link developing countries to the global economy, while biotechnology is closely related to the food and agriculture upon which many developing countries are heavily reliant, Magarinos explained.
At the same time, he said, UNIDO has been actively engaged in bringing the private sector into the development process of poverty-stricken countries, noting that the organization is ready to strengthen cooperation with the Japanese private sector.
In one such example, UNIDO agreed with Mitsubishi Research Institute on May 22 to make efforts to reduce gas emissions contributing to global warming in developing countries. After exchanging information and expertise, they hope to launch a concrete project in the future.
Further partnership programs with Japanese companies are to come later this year, Magarinos said.
Such partnerships should bring benefits not only to developing countries but also to participating companies, he said.
“We are looking for a win-win situation. We want the private sector to work with international organizations for their own interests, seeking their own goals and objectives. If they do that, their participation would be sustainable in the long run and will permanently benefit developing countries.”
Developing countries also need to nurture their domestic industries to achieve sustainable growth, said Jiro Aiko, another forum speaker and adviser to Sony Corp.
To achieve that end, Aiko suggested developing countries utilize the skills of Japanese retirees who have management expertise. Many Japanese are fit to work for several years after retirement and are often willing to do so for a modest salary, Aiko said.
Meanwhile, he stressed the need to introduce an income redistribution system to prevent political instability, which often arises in the process of economic development.
Economic growth creates a disparity between the rich and the poor within a country. Such a disparity could lead to political instability, which would adversely affect economic growth, Aiko said.
He also suggested that a development strategy be formulated with due consideration to the social and economic diversities inherent among developing countries, with each having their own unique conditions and agendas.
During a panel discussion in the latter part of the forum, four panelists joined Magarinos to exchange views on the role of UNIDO and Japan in global industrial development.
Shujiro Urata, professor at Waseda University, said international organizations such as UNIDO should make efforts to find and assist small but promising firms that are serving as a prime source of jobs in many countries.
S. Sundareshan, who is in charge of economic and commercial issues at the Embassy of India, urged Japan — whose population is rapidly aging — to seize business opportunities in emerging markets in developing countries, many of which have a younger population.
Citing the inevitability of globalization, Sundareshan said the question is how to ensure globalization will lead to uniform economic growth in developing countries.
Magarinos noted that globalization is a double-edged sword. “Globalization can work to marginalize countries or it can help them to reach prosperity,” he said. “Investment flow and trade flow are the main tools to achieve prosperity. . . . (But) the majority of developing countries are bypassed by investment.”
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