Globalization and State Sovereignty

MA Thesis
China Foreign Affairs University
外交学院 2003 级硕士研究生毕业论文
Despite Global Changes, Sovereignty Still Reigns
—Globalization and its Impact on State Sovereignty
MA Thesis
Submitted to the Department of English and International Studies
in partial fulfillment of the requirements
for the degree of master of arts in American studies
Major: English Language and Literature
Focus: American Studies
Supervisor: Prof. XXX
导师:XXX 教授
Writer: XXX
May 2006
I would like to express my greatest appreciation to my supervisor Professor XXX
for providing me with constant support and valuable comments on my work. Without
her guidance and assistance this paper would not have been possible.
I am also deeply indebted to all the teachers who have taught me for the last
three years, for their generosity of sharing with me their vast knowledge on English
language and international relations.
I would also like to thank all the staff of the Postgraduate Department who have
worked so hard to create a favorable environment for our study. I am grateful to all the
classmates and friends with whom I have spent the most beautiful days of my life.
Thanks are also owed to all the scholars and intellectuals whose researches and
opinions are drawn on and adopted in this paper.
With the intensification of globalization, there arises an argument that state
sovereignty is weakened and nation-states are eclipsed by forces unleashed by this
wave of international integration. On the basis of the analysis of the actual influence
felt by nation-states, this paper sets to show that the opposite holds true.
The impact on state sovereignty brought by globalization is interpreted from two
aspects: political and economic.
The main contributors of the political impact are identified as international
governmental organizations and non-governmental organizations. The natures and
limitations of these two groups of organizations and their dependency on nation-states
predetermine the restricted role they are playing in managing national and
international affairs.
The economic impact on state sovereignty is delivered by multinational enterprises
and the scourge of marginalization. Multinational enterprises subordinate to and
depend on nation-state governments under a lot of circumstances. And the power
exhibited by nation-state governments in dealing with multinational enterprises
shatters the illusion that multinational enterprises are surpassing nation-states in
strength. Marginalization poses challenges to nation-states, but more importantly it
urges nation-states to strengthen sovereignty and improve governance to ensure that
the benefits of globalization are distributed equally.
Despite the obvious influence of globalization channeled through these non-state
actors, the power stays with nation-states and state sovereignty remains untouched.
The principle of sovereignty continues to govern the international relations.
Keywords: Globalization, Sovereignty, Non-State Actors
摘 要
Table of Contents
Introduction .................................................................................................................. 1
I Sovereignty: An Essential Link between Globalization and Nation-States ......... 3
II IGOs and Their Impact on State Sovereignty ....................................................... 5
2.1 IGOs: An Increasingly Important International Actor ......................................................... 5
2.2 IGOs versus Nation-States .................................................................................................. 6
2.2.1 IGOs: Instruments for Nation-States ........................................................................ 7
2.2.2 IGOs: Intrinsic Lack of Binding Force..................................................................... 9
2.2.3 Dependency on Nation-State for Fund: A Restraint on IGOs ................................ 10
2.2.4 Predetermined Content and Extent of the Transfer of State Sovereignty to IGOs . 12
III NGOs and Their Impact on State Sovereignty .................................................. 16
3.1 Development of NGOs...................................................................................................... 16
3.2 NGOs: More of a Help, Less of a Threat to Nation-States................................................ 17
3.2.1 NGOs: A Helping Hand for National Governments: .............................................. 17
3.2.2 NGOs’ Dependency on Nation-States .................................................................... 18
3.2.3 NGOs’ Inherent Limitations Compared with Nation-State Governments .............. 22
VI MNEs and Their Impact on State Sovereignty ............................................... 26
4.1 Expansion of MNEs in the Era of Globalization ............................................................... 26
4.2 Challenges Posed by MNEs to Nation-States ................................................................... 27
4.3 Unchanged Role of Nation-States ..................................................................................... 28
4.3.1 MNEs’ Subordination to Nation-States: Home Nations and Host Nations ............ 29
4.3.2 MNEs’ Dependency on Nation-States: Home Nations and Host Nations .............. 30
4.3.3 The Power Shown by Nation-States in Dealing with MNEs.................................. 33
4.4 Strong State, Strong Economy .......................................................................................... 35
4.5 The Enhancement of Nation-States’ Role as Required by MNEs ..................................... 37
V Marginalization and the Role of Nation-States .................................................. 39
5.1 The Phenomenon of Marginalization in the Era of Globalization .................................... 39
5.1.1 The Scourge of Marginalization Brought by Globalization ................................... 39
5.1.2 Roots for the Marginalization................................................................................. 41
5.2 Managing the Challenges of Globalization: the Role of Global Governance and National
Governments ........................................................................................................................... 45
5.2.1 What the Global Governance Can Do .................................................................... 45
5.2.2 Challenge for National Governments ..................................................................... 47
Conclusion .................................................................................................................. 51
Bibliography ............................................................................................................... 53
外交学院 2003 级硕士研究生毕业论文
The last two decades have been described as the era of globalization. The processes
of global economic integration, global patterns of communication, and the global
migration of people across territorial boundaries have contributed to the idea of a
global culture. Liberation of trade, investment, capital flows, rapid technological
change and information revolution are making the world increasingly interdependent
and interconnected. Globalization now dominates discussions on the direction of
social changes and representations of the world in which we live.
Globalization is a multidimensional phenomenon encompassing not just economic
but political, social and cultural transformations. The political impact of globalization
is fully reflected in the challenges it has posed to nation-states and their sovereign
rights. Globalization is pushing increasing number of countries to open their
economies and alter domestic as well as foreign policies. The fact that globalization
has generated immense impact on the sovereignty of nation-states is inarguable. But
views are divided on the future of nation-states and the destiny of sovereignty.
Globalists have come up with predictions that nation-state is to be made
anachronism and sovereignty a thing of the past by globalization. According to them,
state authority has leaked away, upwards, sidewards, and downwards and in some
matters, just evaporated. With the development of so many transnational processes, it
has been assumed that sovereignty of nation-states are being withered by globalization;
nation-states are about to be swamped by forces beyond their control, and that the
Westphalian system of absolute state sovereignty is failing into pieces.
Ohmae, a great admirer of multinational enterprises, claimed the demise of
nation-state on the basis of four ‘I’s: investment, industry, information technology,
individual consumers. Susan Strange observed that national sovereignty has declined
from the assault of a matrix of forces unleashed by globalization.
However, this viewpoint is strongly opposed by another perception that sovereignty
of nation-state, despite the fierce repercussions from globalization, stays mainly
外交学院 2003 级硕士研究生毕业论文
untouched. Holders of this view acknowledge the rising influence of globalization on
the sovereignty of nation-state, but observe state sovereignty is still in control, and
nation-states remain the cornerstone of the international system. This echoes Hirst and
Thompson’s contention that the strength and scale of globalization are exaggerated
and the end of nation-state is an illusion rather than a reality. They take issue with
proponents of the perception that sovereignty is eclipsed and believe the opposite to
hold true, since states are to adapt their roles and improve their functions to harness
globalization to their advantage.
It is not difficult to notice that these two views are quite opposite from each other,
however, they share one thing in common: both note the immense impact
globalization has imposed on state sovereignty and the challenges nation-states face.
Globalization has unavoidably affected national sovereignty of Western and
developing countries alike. The effects of globalization on the sovereignty of
nation-state flow through two distinct but interconnected channels, political and
economic channels. The political effect as channeled by transnational governmental
organizations and nongovernmental organizations provides rationale for ‘low
stateness’. And the increasing weight of multinational enterprises has created a new
and more constraining context for state action in the economic field.
These three new international actors rising from globalization are held to be the
most prominent restraints on nation-states’ authority. Therefore, this paper is going to
make a study of these three actors and analyze the actual effects these actors have
imposed upon the sovereignty of nation-states, and on the basis of the analysis, try to
offer an answer to the question of whether globalization is really heralding the end of
nation-states and the demise of sovereignty.
外交学院 2003 级硕士研究生毕业论文
Sovereignty: An Essential Link between Globalization and
The international system is organized around sovereign states. Sovereignty means
that the state, or its representatives (the government), has the final say within its
territorial jurisdiction. This means that no higher authority exists in international
relations than the state.①
The Treaty of Westphalia signed at the end of the Thirty Years War in 1648 signaled
the establishment of the Westphalian system—the nation-state system, and of the
formal implementation of a comprehensive concept of national sovereignty with a
dual implication of both internal and external aspects. Sovereignty hence refers to the
absolute internal authority of a state within its territory and the freedom of
intervention from other states on the international platform. And ever since, the
principle of sovereignty is acknowledged as the basic principle governing
international relations.
As a historical concept, sovereignty has experienced a protracted process of
evolvement, withstanding waves of assault and skepticism as an ever-new
controversial problem of political discussion.
In face of the swamping torrents of globalization, nation-state and state sovereignty
come into the limelight again and questions arise as to whether we are living through
another political transformation which might be as important as the creation of the
nation-state. Is the exclusive link between territory and political power being broken
by globalization? A number of comments upon and analyses of globalization have
given rise to the fierce debate of whether globalization will destroy or marginalize
nation-states, since globalization has brought about the unprecedented activeness and
prominence of three groups of global actors: multinational enterprises, international
Kelly-Kate S. Pease, International Organization (New Jersey: Pearson Education. Inc., 2000), 6.
外交学院 2003 级硕士研究生毕业论文
governmental organizations and nongovernmental organizations. The expanding role
and increasing influence of these actors have made them the focus of academic study
on international relations. They are believed by some to have eclipsed nation-states
and weakened state sovereignty.
In order to get a clearer picture of this phenomenon, it has to be noted that the
forms and patterns of exercising sovereignty are diverse. Just as an individual has a
variety of ways of disposing his property, including direct ownership, sub-ownership,
leases and licenses, a national government can also use sovereignty in different ways.
Both conceding and forfeiting sovereignty for the benefits of the state should wisely
be seen as the application of sovereignty rather than the destruction of the concept of
sovereignty per se. Activities such as entering into treaties, contracts that are good for
both parties sometimes entail encroachment upon part of the sovereignty of the
signatory states. In fact, since 1648, states have forfeited portions of their national
sovereignty in order to acquire the benefits arising out of a cooperative relationship
with other states.
The new trends and conditions in the twentieth century, especially the salient
escalation of globalization call for and also facilitate the flexibility of governments in
exercising sovereignty. Sovereignty has gained new forms of realization in this new
era. Globalization is not robbing states of sovereignty, making the states less central to
national opportunities for development than it was in the past. If anything, national
governments are even more important in deciding whether the world economy are
helped or hindered by globalization, which testifies to the robustness and continuity of
state sovereignty though there is no lack of misunderstanding amid the clamor that the
death knell of sovereignty is struck.
外交学院 2003 级硕士研究生毕业论文
IGOs and their Impact on State Sovereignty
2.1 IGOs: An Increasingly Important International Actor
An international governmental organization (IGO) is an organization composed of
sovereign, independent states that voluntarily enter into treaties, agreements and
conventions in a common pursuit of certain purposes. Therefore, a charter or a
constitution must be created and agreed to by states that wish to pursue objectives
within a formal organization. The United Nations (UN), the most influential IGO of
the world, is essentially an association of states following a certain course of action in
pursuit of world peace and development through a multilateral treaty, which is known
as the UN Charter.
The globalization era has witnessed a massive proliferation of IGOs. Active IGOs
now number well over 20,000. And they feature prominently in contemporary world
and regional politics; among them the United Nations (UN), World Trade
Organization (WTO), World Bank (WB), International Monetary Fund (IMF),
European Union (EU), North America Free Trade Agreement (NAFTA) and Asia
Pacific Economic Cooperation (APEC) are typical examples.
As a prime example of IGOs, the United Nations’ great achievements in various
fields shall be quite illustrative of the significance of IGOs in general. The UN is the
most important IGO with the widest recognition and largest membership of the
international community. Ever since the first day of its establishment, the UN has
served as a platform for communication, negotiation and cooperation between
different member states, which vary enormously in size and power; it has spared no
efforts in orchestrating operations for the common benefits of the whole human
society with obvious results scored; by pooling together efforts from different sectors,
the UN has contributed enormously to world economic development and the
外交学院 2003 级硕士研究生毕业论文
settlement of international conflicts,and has played a decisive role in addressing
issues of worldwide concern, such as disease, human rights and environment
problems. In a word, the United Nations occupies an irreplaceable place in the
international arena. And the role of the United Nations is expanding with the
deepening process of globalization.
Up until now, a wide range of developing countries have become an important
force in shaping the system of international relations through participating in IGOs,
such as Non-alignment Movement, G77 and OPEC in addition to the UN. This has
enhanced the representativeness of IGOs and expanded their scope of influence.
Such prevalent organizational ties are believed to have set in motion forces
encroaching upon the sovereignty of nation-state. State sovereignty is said to be
restricted by the growth of IGOs and the agreements legally contracted with other
states upon entering into membership of these organizations. Some extreme views
even claim that IGOs are taking the place of the nation-states in dealing with
international affairs.
2.2 IGOs versus Nation-States
In dealing with international affairs, however, one should constantly bear in mind
the principle of state sovereignty. Through hundreds of years of evolvement, this
principle still applies well and continues to play an essential role in both
contemporary international law and international affairs in spite of the increasing
entanglement of states with international organizations. In fact, the very establishment
of IGOs is based upon this principle. The concept of sovereignty which is
characterized by the unlimited authority of the state to exercise its will unchecked by
any superior or external control remains a fundamental condition of international
politics despite the overwhelming growth of IGOs.
The perspective on the robustness of the sovereign authority of nation-states and
the irrationality of the forecast that IGOs are taking the place of national governments
外交学院 2003 级硕士研究生毕业论文
will be reinforced by an analysis of the nature of IGOs and the interaction between
nation-states and IGOs.
2.2.1 IGOs: Instruments for Nation-States
The whole field of international organizations is likely to be perceived as a group of
more or less useful pieces of machinery through which to enhance national policy
aims. No country is going to sign any international treaty to enter an organization
from which no benefits can be expected. IGOs are organizations between sovereign
states not above states. They are created to serve the interests of states, not the other
way around. As a way for the collective pursuit of foreign policy goals, IGOs are
subject to evaluation by member states in terms of their utility. This instrumental
outlook means that, as with other modalities of foreign policy, the national
policymaker weighs the costs and benefits of participating in an international
organization or attempting to mobilize it for specific purposes.
The IGOs exist because nations find them convenient. Governments of member
states opted to join the UN not out of any sense of idealistic high-mindedness as they
may have claimed, but because the UN is an instrument for national foreign policy. In
somewhat similar vein, IGOs are often regarded as the tools of the great powers to
control lesser states without dominating them by force. They are agents of the
dominant powers and serve great-power interests at the expense of others. Many view
the IMF as an extension of the United States, with hostile intentions. Hong Kong’s
Sing Pao Daily News stated: As the biggest contributor to the International Monetary
Fund, the U.S. would like to push open the Asian market as well as to increase the
proportion of foreign enterprises by means of IMF loan conditions.①
In addition, major powers can often determine if organizations will be active at all
in areas of interest to them. The war crimes tribunals for the former Yugoslavia and
Rwanda solve problems for the leading nations. A permanent war crimes tribunal is
Kelly-Kate S. Pease, International Organizations (New Jersey: Pearson Education. Inc. 2000), 200.
外交学院 2003 级硕士研究生毕业论文
judged inconvenient by the United States, which tries to block it or refuses to sign the
treaty. As Susan Strange states, “All those international arrangements dignified by the
label regime are only too easily upset when either the balance of bargaining power or
the perception of national interest changes among those states who negotiate them.”①
History has proved conclusively that an international organization, in a fashion similar
to a national government, can succeed only when supported by those it is to serve.
As instruments for nation-states, IGOs are not in themselves endowed with
sovereign rights since all the rights are attributed by member states through their
signing of treaties, agreements or conventions. IGOs do not have the rights to lead or
dominate nation states, and they are not supposed to interfere in any affairs that fall
into the domestic jurisdiction of nation states according to the principle of
The UN was founded on the principle of sovereign equality of all members. This
simply means that each state, at least in the legal theory, retains the right to determine
its own internal and external affairs. As emphasized in Article 2 of UN Charter:
Nothing contained in the present Charter shall authorize the United Nations to
intervene in matters which are essentially within the domestic jurisdiction of any state
or shall require the Members to submit such matters to settlement under the present
Charter.② The UN Charter is agreed upon after the member states are convinced that
no infringement of the national sovereign interests exists and no invasion of ‘domestic
jurisdiction’ is sensed.
IGOs are often viewed as restraints on the behavior of states and begin to take on
independent like. But it is a limited sort of independence: the organizations are
created and sustained by the states in a collective act of self-limitation or
self-enhancement, and there is certainly no expectation that they will come to coexist
with, or even supersede, their creators as the dominant actors in the international
system. The EU, best developed organization between states, is far from being a
Kelly-Kate S. Pease, International Organizations (New Jersey: Pearson Education. Inc. 2000), 52.
中国联合国协会/编,《联合国基础知识》(北京:世界知识出版社, 2000), 159.
外交学院 2003 级硕士研究生毕业论文
single political entity with independent authority, since the way of EU seeking
consultancy and making decisions remains within the framework of diplomatic
interaction between states. The members of EU Parliament make decisions under the
strict guidance of their own nation states and in case of a conflict of interests, they
will be given unequivocal and direct order by their own governments. The EU is not a
state with sovereign rights and all its policies are subject to the will of its member
states which keep a strict control of their sovereignty.
2.2.2 IGOs: Intrinsic Lack of Binding Force
The lack of independent sovereignty determines that the decisions or resolutions of
IGOs are not binding on members states. The enforcement and implementation of the
decisions adopted by IGOs rely on the recognition and compliance on the part of
member states, or the pressure of the international community.
Unlike a national government which is able to punish violators, an international
organization can do no more than depend upon the good faith of its members to
respect its policies and decisions. In some cases, in spite of the existence of executive
and judicial agencies, no enforcement measures are available to be taken. The
limitations imposed by international treaties and conventions are not legal since they
are voluntary limitations, self-imposed, unenforceable by any higher authority, and
can be denounced by the sovereign state at its leisure. The UN, as the most important
organization of its kind, is far from being a superstate and nothing of a world
government, since it does not have the authority to legislate or tax, nor does it have
the power to enforce its decisions upon individuals. All the power it has originates
from its member states and in case of contempt, nothing can really be done except a
Obviously, the UN has played an important role in resolving global conflict and
maintaining world peace. However, it is not completely effective in dealing with
security issues over the past thirty years. A survey of UN mediation of interstate
外交学院 2003 级硕士研究生毕业论文
conflicts has calculated that, of 355 mediations studied, a successful outcome was
achieved only on 35% of occasions. One explanation to this mixed record of success
and failure should be the opposition of states concerned. Without a consensus,
commitment is hard to establish. Member states may be willing to contribute to
enforcement actions, but when those actions run contrary to their national interests,
they will definitely go for the latter.
The UN Security Council is the sole agency entitled to take enforcement measures
on the legal basis of Article 1 and Article 40 of the UN Charter. Nevertheless, these
measures are strictly limited as the UN Charter provides the three principles for
peacekeeping operations: neutrality, self-defense and agreement. Peacekeeping is
successful only when all party states, including the belligerents, wish to undertake the
mission. The dominance of state sovereignty shatters any illusion that an international
police force is on the horizon since the various national components of UN
peace-keeping or crisis intervention forces remain under the influence and ultimate
control of national governments rather than the UN.
The UN relies on member states for efficient operation and it can never evolve into
a world government when sovereign rights remain firmly in the hands of national
The facts of present-day international life make it clear that despite the need for
good faith in interstate relations and the development of complex interrelations among
states, each state, in the final analysis, seeks to be its own interpreter of international
obligations and maintains the right to determine its own standards of international
conduct. Should a vital national interest be seriously threatened, a state, particularly if
it is a major power, may still pursue a unilateral course of action, supported by the
popular belief of its citizens that as a sovereign entity, it cannot be legally restricted in
its external as well as internal acts.
2.2.3 Dependency on Nation-States for Fund: A Restraint on IGOs
外交学院 2003 级硕士研究生毕业论文
IGOs depend upon the contribution and funding of member states for proper
operation. Shortage of fund constitutes a serious restraint upon IGOs, overshadowing
their ability to meet international commitments.
Most IGOs are faced with a dilemma. On the one hand, with the increase of
activities IGO engaged in, the expenditure is also on the rise. On the other, many
countries are very slow in making their contributions and the situation is worsening.
For instance, the UN seems to be in a perpetual financial crisis. The United States,
which is the UN’s largest contributor, is also its largest debtor. The U.S. arrears
account for approximately 60 percent of what is owed to the UN.
In addition, in most IGOs, the right of voting for member states is closely
associated with the percentage of budget they have accounted for. Therefore, this kind
of financial system subjects IGOs to the manipulation of the powerful states with solid
financial basis. Periphery societies are controlled politically because they are given a
voice in organizations like the UN in which that voice carries very little weight. The
United States’ manipulation of IGOs is often cited as an outstanding example. It is
said that the US hegemony is facilitated and exercised through IGOs.
Serving as a policy instrument to its member states doesn’t indicate that the UN has
become the policy instrument used by all its member states to the same degree.
Despite the accomplishments it has achieved, there is still concern about the goods the
UN can really deliver to the international society considering the problems hanging
around, such as financial problem, inefficiency of its operation and the unequal say
given to its member states. It is always unavailable to a cohesive underdeveloped,
anticolonial majority of its members. Certainly the organization’s priorities and
preoccupations have changed radically after the decolonization, which stimulated the
increase of independent states, and consequently enlarged UN membership, but so far
the increased organizational presence of the Third World has not been matched by
effective, concrete policy outcomes. The organization’s responsiveness is largely
verbal and symbolic, and is likely to remain so as long as the Western states, which
control the purse string, the bulk of the world’s military force, remain the dominating
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2.2.4 Predetermined Content and Extent of the Transfer of State Sovereignty to
In order to protect the essence of state sovereignty, domestic laws of member states
establish rules governing the whole process of transfer and impose conditions and
limits for the granting of state powers in dealing with IGOs.
First of all, the object of the transfer will be the exercise of certain sovereign
powers but not their ownership, which remains in the hands of the member states. The
powers or competences transferred from states to international organizations are not
wasted, since once the objectives of an IGO had been accomplished, or the
international organization beneficiary of the transfer disappeared, the powers would
revert automatically to states.
Even the most advanced international organization, the European Union, is entitled
to exercise only those functions expressly attributed to it by the member states.
The EU is the most developed international organization in terms of integration
level. It has attracted world attention with its dramatic process of involvement and
current status of development. The cession of sovereign rights by its member states is
indeed unprecedented, which includes the transfer of tariff rights by establishing tariff
agreement, the cession of territorial sovereignty by eliminating nationality
discrimination for free flow of nationals, and the transfer of monetary sovereignty by
issuing Euro. However, as we have said before, the cession of sovereign rights is a
form of exercising sovereignty by nation states, and what is transferred in the process
is the ‘exercise’ rather than ‘ownership’ of the rights.
In addition, it has to be pointed out that the cession of rights by EU member states
is based on rational choice and systemic guarantee. In the era of globalization,
European countries have realized that there is no better way to meet the challenges
外交学院 2003 级硕士研究生毕业论文
brought by an integrated world economy than the cooperation or integration between
states. A regime of collective decision-making guaranteed by the treaties relieved the
member states of worries about the encroachment on national interests by endowing
them the veto right on issues concerning the transfer of sovereignty and fundamental
interests of member states.
Secondly, there are material limits to the transferee. Powers can be transferred only
to a limited extent. Constitutions prohibit the transfer of the totality of the states’
powers which, although vested in Parliaments and other internal institutions, emanate
directly from the people. The new international entities that emerge from the transfer
of sovereignty may therefore exercise, within a very definite field, executive,
legislative and judicial functions but they can never take the states’ place.
Despite the striking amount of uniform policies, the EU still has some way to go
before it can claim a common foreign policy, and the member states still have much
individual freedom in their relationships outside Europe and in the way they define
and express their defense interests. The EU is slowly becoming a more distinctive
actor on the world states, most notably on trade issues and development aid to poorer
countries, but non-European governments must still approach each of the member
states individually on issues such as security threats in the Middle East, nuclear
testing, relations with former colonies and so on.①
Thirdly, there are temporal limits to the transfer. Delegation should not be
construed as a dereliction or a definite cession of sovereignty. Powers can be
transferred to IGOs with either a provisional or a permanent character, but, in any case,
transfer is not irreversible because for the states there is always the possibility to
recover the powers conferred by means of a unilateral withdrawal from the IGO.
There is no IGO, whether traditional or supranational, which can prevent the
secession of one of its members. In
December 1984, the United States declared its
official secession from the United Nations Education, Science and Culture
Organization (UNESCO), claiming that it was unsatisfied with the inadequacy of
John McCormick, Understanding the European Union (New York: Palgrave 2002), 120.
外交学院 2003 级硕士研究生毕业论文
UNESCO’ s reform, its high operation fee and its failure to solve the problems
identified by the US government.
In light of the practical situation, some admit the inadequacy of integration of EU to
be called a superstate, but predict that EU will eventually evolve into a superstate in
the near future with permanent transfer of sovereignty of member states. The truth is,
in consideration of all the uncertainties, it is premature to conclude on the future of
EU as a superstate entity.
One problem is that the transfer of sovereign rights is a reflection of the national
will, and the willingness to cede sovereignty on a permanent basis on the part of the
states concerned is too vague to predict. In addition, the EU is a voluntary
arrangement and there is nothing in theory to prevent a member state from leaving.
There is also a problem at the grass roots for EU to act as a superstate, and that is
the problem of creating a sense of unity at the grass roots. Membership of the EU is
reversible, and several anti-European movements within the member states have
called for their country to leave the EU.① Although old hatreds, such as between
France and Germany, are certainly dying, no new pan-European nationalism is
emerging. For solidarity engendered by nationalism can exist normally only within
the national community, where sufficient mutual identification and common interests
among people can be found so as to induce minorities freely to consent to majority
rule and obey a common government based upon that. Such solidarity underpins a
people's allegiance to a government as ‘their’ government, and their willingness to
finance that government's tax and income-transfer system, thereby tying the richer and
poorer regions and social classes of the nation state together. The solidarities that exist
within nations do not exist between nations.
Indeed, the structure of IGOs rests upon the principle of sovereignty and their
operation is based on the recognition of member states’ sovereign rights. The EU, ‘the
most complex or ‘best developed’ regional organization in the world, is no exception
John McCormick, Understanding the European Union (New York: Palgrave 2002), 119.
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to this general rule. It appears to have limited the sovereign authority of member
states, but subordinating to these limitations is a form of exercising sovereignty by
national governments. The ownership of the sovereign rights remains firm in the
hands of member states.
IGOs are far from superseding nation-states, robbing them of their sovereignty.
States remain the principal and most essential actors in international relations, and
international organizations are subordinate to the dominant powers of the day, and
will continue to play secondary roles in the management of international affairs.
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NGOs and their Impact on State Sovereignty
3.1 Development of NGOs
There is no universal agreement on what nongovernmental organizations (NGOs)
are exactly. A 1994 United Nations document describes an NGO as a non-profit entity
whose members are citizens or associations of citizens of one or more countries and
whose activities are determined by the collective will of its members in response to
the needs of the members of one or more communities with which the NGO
cooperates.① In a simple way, NGOs are often referred to as organizations which have
not been established by governments or agreements among governments, and
comprise usually of individuals and private associations, rather than states as their
members. In other words, nongovernmental organizations are any organizations
outside the government.
The emergence of NGOs is not new. The establishment of the famous International
Commission of Red Cross bates back to the 19th century. What is new is the recent
explosion in numbers, activity, and visibility of international initiatives by NGOs on a
variety of issues, linked to the rapid expansion of globalization of communication,
transportation and production. On the one hand, the increases of information flows,
human travel, and trade associated with globalization have on the whole made the
formation and operation of international NGOs easier and less expensive. And on the
other, globalization has contributed to the rise of new problems to which international
NGOs and alliances shall be relevant, such as environmental problems, including
global warming, ozone depletion, and cross-border pollution. In a word, NGOs are
springing up in the era of globalization to fill various needs.
(杭州:浙江大学出版社, 2004)
外交学院 2003 级硕士研究生毕业论文
Nowadays, a wide variety of NGOs are functioning at the local, national and
international levels, however, a narrow slice of the NGO spectrum is often focused
upon by analysts: the international ones which operate on a transnational basis with a
worldwide scope. These NGOs are active in a number of areas, including
humanitarian issues, environment problems, human rights and other issues of social,
economic, and political importance. International Commission of Red Cross, the Save
the Children Fund, the World Wild Life Fund and Greenpeace, and the Amnesty
International are few of the most prominent NGOs in relevant fields.
3.2 NGOs: More of a Help, Less of a Threat to Nation-States
With the increase of NGOs’ involvement in global affairs and their growing impact
on national governments, some get worried that NGOs are taking over the functions
from national governments and encroaching upon the authority of nation-states.
Actually, if we take a closer look at the nature of IGOs, the activities they are engaged
in and the methods they adopt in fulfilling the initiatives, we will see that NGOs are
more of a help than a threat to national governments.
3.2.1 NGOs: A Helping Hand for National Governments
The growing popularity of NGOs proves helpful to national governments since
some humanitarian and development NGOs have a natural advantage in fields where
governments are reluctant to enter into, or slow at identifying problems and delivering
solutions. Due to their rich expertise and resources, grassroots connections and sense
of commitment, NGOs on the ground often make the impossible possible by doing
what governments cannot or will not do.
Governments find it convenient to turn to NGOs for innovative ideas and
information. NGOs are characterized by their capabilities of mobilizing the
community, channeling resources, as well as providing technical expertise and skillful
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lobbying for the achievement of social justice and human welfare. NGOs make use of
their uniquely close touch with voiceless population and their wide linkage to media
to help give prominence to international problems that are not raised or solved
Governments’ functions are completed with the participation of NGOs. NGOs have
become the second largest source of development assistance behind national
governments. In many developing countries, NGOs have managed a significant share
of incoming assistance. An article in the New York Times just before the UN
Conference on Environment and Development in 1992 cited development successes
by NGOs such as the Trickle-Up Program, and stressed their low costs and high
Through orchestrating campaigns to formulate and enforce global public policies in
response to critical problems, NGOs help construct international values and norms
that can guide future international policies and practices. Greenpeace, as one of the
world’s most famous environmental NGOs, is recognized as a major factor in shaping
the environment debate. And the International Baby Food Campaign has produced a
code of conduct adopted by the United Nations.
NGOs’ focus on social problems and their ability of channeling resources for the
solution of identified issues predetermine the important role they are playing in
shaping the national and international policies. At the same time, the participation of
NGOs has heightened the influence of the public on governmental policies so as to
monitor accountability and transparency of national governments which are urged to
promote democratic principles and practices, deliver effective public sector policy and
services. They act as an extra hand of national governments in discovering and
addressing issues of importance to the welfare of people all over the world.
3.2.2 NGOs’ Dependency on Nation-States
The interaction between NGOs and national governments is not as smooth as we
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have described above. The full picture is much more complex with conflicts and
contradictions cropping up between these two actors from time to time. Hence the
challenges posed to nation-state governments by NGOs both on domestic basis and in
the international arena. Nevertheless, no matter how influential NGOs become, they
are far from being a threat to the national governments, to the sovereignty of
NGOs are not shattering the Westphalian system, or rendering nation-states any less
relevant in handling domestic and international affairs. The phrase nongovernmental
is in itself Westphalian: organizations are either ‘governmental’ or they are not. Even
if NGOs are outside governments, their proper functioning is inseparable from the
support of governments. The aims and goals of NGOs can only be materialized when
governments are persuaded to accept the values and convinced of the benefits that
would follow once actions are taken.
An understanding of the means applied by NGOs may give us a glimpse of the fact
that governments are the key to the missions NGOs engaged in. NGOs may employ
both direct and indirect lobbying techniques. Direct lobbying techniques involve
contacting officials (and their staffs) in order to persuade them to adopt appropriate
initiatives or policies. Indirect lobbying techniques involve multinational advertising
campaigns aimed at shaping or mobilizing public opinion. These techniques also
include executing grassroots campaigns that take place at the international and
national levels, so as to produce pressure on governments to reconsider their
From the means open to NGOs, we can see that state governments are crucial to the
proper functioning of NGOs. The practical application of these means in the pursuit of
certain aims by NGOs is even more convincing in this respect. The successful launch
of the Mine Ban Treaty is often cited to show the great influence possessed by NGOs,
which is of course more than justified. However it can also serve as a prime example
to illustrate the reliance of NGOs on nation-state for the materialization of their goals.
Kelly-Kate S. Pease, International Organizations (New Jersey: Pearson Education. Inc. 2000), 34.
外交学院 2003 级硕士研究生毕业论文
Initiated in 1991 by a group of NGOs, the International Campaign to Ban
Landmines calls for an international ban on the use, production, stockpiling, and
transfer of antipersonnel landmines and for increased international resources for
humanitarian mine clearance and mine victim assistance program. There is no
shortage of praise showered on NGOs for the successful signing of the Treaty because
of the great efforts they have made during the whole process of the campaign.
However, it should also be noted that the Mine Ban Treaty went through
From the very beginning, NGOs had realized that national governments were the
key and the target of this campaign. NGOs pulled out all stops to make sure that
governments would be convinced of the good this Treaty could do. Through a great
amount of efforts at research and skillful persuasion, NGOs managed to ensure
governments that there was scarcely a connection between the use of landmines and
national security, but a strong connection between landmine usage and humanitarian
disasters. Therefore under the impression of no national interests being harmed as
well as the heavy pressure from the international community, signing national
governments said yes to this Treaty.
While being amazed at the great power NOGs had exhibited during this campaign,
we can not fail to notice another important message this event has conveyed: the
NOGs’ dependency on governments for the realization of their aims. Through the
whole process of negotiation, the compromise and cooperation on the part of national
governments are crucial to the success of the Treaty. Moreover, several important
countries absented themselves from the unconventional negotiations and have not
signed the treaty. The United States attended the final negotiating conference in Oslo,
but after its proposed changes in the treaty's substance were rejected by the
conference, President Clinton said the U.S. would not sign the treaty for at least eight
years. Other non-signatories include Russia, China, India, Iraq, Libya, Pakistan and
North and South Korea. The response of these countries demonstrates once again that
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nations-states have the final say on international issues. And the right to decide what a
nation should do remains firmly in the hands of national governments. In order to
fulfill their missions, NGOs have to make sure that nation-states are partners instead
of opponents of their advocacy.
In addition to policy backing, the support given by governments to NGOs also
includes financial assistance. IGOs are not as financially independent as national
governments, which have fixed sources of revenue, and are often dependent upon
states for fund in pursuit of advocated goals. And the fund given by governments is
often one of the main financial resources of many NGOs. Sometimes, the financial
support of state governments is indispensable in helping NGOs realize their values.
There is plenty of evidence that the growth in size and number of NGOs is fed by
increased governmental contributions along with greater contributions from
multilateral developmental organizations such as the World Bank. NGOs come to rely
more on public-sector funding which now accounts for around 40 percent of NGO
budgets versus only 1.5 percent in 1970. Many NGOs participate in projects and
services funded by governments. Some analysts already fear that formerly
independent NGOs may become more beholden to national governments.
Nation-state governments exercise supreme power within their territories. They can
decide whether to support and authorize NGOs, or restrict their activities.① Neither do
NGOs possess the political authority as nation-states, nor are they blessed with
massive economic resources as multinational enterprises. The sources of their
influence are mostly from their moral authority: representing the common will of a
part of the civil society on certain issues. In face of the refusal or restriction on the
part of governments, NGOs appear helpless and powerless.
When the US government saw more harm than good the Kyoto Protocol can do to
its economy, it sentenced the treaty to death for which the NGOs had lobbied hard and
long. In June, 2003, Egypt put into practice the law governing NGOs, which placed
,(北京:北京大学出版社,2004), 34.
外交学院 2003 级硕士研究生毕业论文
severe restrictions on NGOs. As a result, the Human Rights Watch documented
numerous cases where the security services rejected NGO registrations. And also
Russian President Putin has signed into law a restrictive bill regulating the work of
NGOs in January 2006, giving the Justice Minitry’s Federal Registration Service
broad authority to shutter NGOs for engaging in activities that are prohibited, or run
counter to the ‘political independence of the Russian Federation.
3.2.3 NGOs’ Inherent Limitations Compared with Nation-State Governments
(1) Lack of Legal Status
Unlike states, NGOs do not enjoy formal recognition (legal personality) under the
international law, although they have achieved recognition under domestic laws of
various countries. This can be reflected in the treatment of NGOs on the part of
international governmental organizations.
NGOs’ participation
Intergovernmental organizations sometimes allow representatives of NGOs to observe
departmental meetings and receive certain types of documents. On rare occasions,
NGO representatives are allowed to speak at meetings. NGOs, however, do not have
the power to vote at these meetings or execute any binding decisions. Some NGOs
have obtained ‘consultative status’ with international organizations. However, the
‘consultative status’ is at present granted only to a minority of NGOs. The majority is
thus excluded and cannot enjoy the advantages of this status. In addition, the term
‘consultative status’ simply governs relationships between a given IGO and a given
NGO and does not confer any right on an NGO capable of being exercised before any
other national or international authority. Article 71 of the United Nations Charter
permits NGOs to establish consultative relations with the Economic and Social
Council, which allows and only allows them to provide the UN with technical advice
and to express the views of the public.
The future is not necessarily bright for NGOs. It is a pessimistic sign that some
外交学院 2003 级硕士研究生毕业论文
governments at the UN are now feeling uncomfortable with the extent of NGO
involvement. NGOs are not necessarily fully representative. Developed countries,
with a total population now forming a small minority of the total world population,
are disproportionately represented in the NGO community, while the voice of
developing countries is accordingly limited. Additionally, the growth of NGO number
at UN meetings causes administrative and security concerns. The discomfort has
already led to moves to reduce that involvement.
( 2) Weaknesses of NGOs
Despite the demonstrated capacity of NGOs to make contribution for the welfare of
human society, their inherent weaknesses have exposed them to heightened criticism.
Embracing a wide range of interests, goals and agendas, NGOs have the capacity to
disrupt as well as to create. The challenge facing national governments is not whether
to include NGOs in policy deliberation and implementation but the way to take
account of their strengths and weaknesses, their potential to do as much harm as good
while incorporating them into the international system.
NGOs are especially criticized for a lack of overall perspective, stability and
constancy. The fact that the states are inherently better equipped for large-scale
initiatives, just as the NGOs may be better equipped for small-scale local experiment
and innovation is self-evident. Most NGOs are created with very specific mandates
tied to their funding. They specialize in certain fields, with strictly delimited goals.
The narrow focus on one particular issue frequently excludes the wider context, which
limits the effectiveness of NGOs. As a result, NGOs always fail to see the ‘big
picture’ and are believed to be better at blocking than implementing large-scale
With the growth of the number of NGOs, a great diversity has been spawned that is
pushing in a multitude of different, even competing directions. The activity of
thousands of NGOs may create distracting ‘noise’ and information bottleneck. At the
same time, NGOs can easily become confused about their accountability due to the
外交学院 2003 级硕士研究生毕业论文
intense competition among NGOs. The UN High Commissioner for Refugees warned
in 1996 that if national governments continue to rely too much on NGOs rather than
multilateral agencies in donor assistance, they may undermine important systems of
coordination and cooperation in large-scale emergencies.
Due to a lack of legitimacy and the restrictions placed by fund sources, NGOs are
vulnerable for manipulation. Even in recent years, some NGOs, aid organizations and
development institutions from the ‘North’ have been described sometimes as being
tools or part of the objectives of the foreign policy aims of the northern nation from
which they come. As extreme examples, in some countries, government officials have
set up their own NGOs as a way to work more creatively, access different resources,
and gain new opportunities. Similarly, some development NGOs amount to no more
than ‘briefcase companies’ founded for the purpose of tax evasion and private gain.
Today, in a phenomenon that one environmental activist bemoaned as the ‘rise of the
global idiots,’ any group with a fax machine and a modem slogan has the potential to
distort public debate as an NGO.
Many NGOs are not as democratic or accountable as they claim to be. Hailed as
promoters of more openness and participation in decision-making, they may instead
turn out to produce gridlock on a global scale. Even legitimate, well-established
groups sometimes seize on issues that seem designed more to promote their own
image and fundraising efforts than to advance the public interest. For example, in
1995, Greenpeace continued to attack the Royal Dutch/Shell Group for its plans to
sink an oil rig (the Brent Spar) in the North Sea, even after independent scientific
analyses showed that the environmental effects of doing so would be inconsequential.
Also, NGOs rise and fall based on consumer demand: fulfilling a need, they will
continue; not meeting a need, they will fail. After the World War II, there was a burst
of enthusiasm about NGOs, which was soon followed by a gradual decline during the
1950s. Then the trend got reversed as issues of environment, development, population,
and food aid were put up on the international agenda. Today, in the wake of
globalization boost in NGO activity, NGOs have got a wide recognition by national
外交学院 2003 级硕士研究生毕业论文
governments and international organization. However, as to the duration of this round
of new enthusiasm, uncertainty hangs.
There has also been criticism on the use of the funding and other money that NGOs
have received or raised. Criticisms range from pointing out that only small
percentages go to people in need, and that a lot goes to recover costs, and some even
have been used to pay very high salaries of the people at the top. One recent study on
NGOs and peace-building in Bosnia criticized the use of advertising (from signboards
to t-shirts) by NGOs to promote their reconstruction programs to potential donors.
Such advertising, the study noted, had the effect of denigrating local rebuilding efforts
and raising questions about where NGOs were actually putting their money. In Sudan
and Somalia, NGOs have subsidized warring factions by making direct and indirect
payments to gain access to areas needing assistance. In other conflict settings such as
Ethiopia and Rwanda, NGO constructed roads and camps for civilian assistance
which have instead been used by combatants.
NGOs possess merits conducive to the overall development of the society and have
indeed played a crucial part in the settlement of a wide range of critical social
problems. But NGOs’ involvement depends on two factors: the needs of governments
and the capabilities of NGOs. The inherent limitations and weaknesses of NGOs and a
lack of legal status greatly restrict the role they can play in the international political
arena and render the expectation of them surpassing nation-states in status and
functions a mere fantasy. Faced with NGOs, nation-states remain irreplaceable and
unchallengeable in terms of sovereign authority and the ability of managing domestic
and international affairs.
外交学院 2003 级硕士研究生毕业论文
MNEs and their Impact on State Sovereignty
The core of international integration lies in economic integration. This is especially
true in contemporary world, as the impact of globalization is best reflected in the
economic sphere. With the continuous expansion and penetration of market economy,
all nations are involved in this huge wave of economic integration. In this process,
multinational enterprises (MNEs), one of the main actors of globalization, are the
main driving force of this immense economic transformation. As Malcolm Waters put
it, “The main focus for many hopes and fears about economic globalization is the
MNE or TNC (Transnational Corporation).”①
4.1 Expansion of MNEs in the Era of Globalization
MNEs are private, for-profit organizations that have commercial operations and
subsidiaries in two or more countries ② . MNEs usually engage in foreign direct
investment and own, or control, activities in these countries where they are present.
As in the case of many of the components of globalization, the development of
MNEs is a long-term process with a recent acceleration rather than a sudden and
qualitative shift. The origins of MNEs go back to the period from 1870 to 1900 when
enterprises began to set up foreign branches and become involved in FDI.
Globalization, however, has opened golden opportunities for MNEs to expand. Now
the scale and number of MNEs have grown exponentially in the process of
According to the statistics of the United Nations, there were 7276 MNEs all over
the world in 1968 and 1969, and the number reached 15,000 in 1980, 37,00 in 1992,
Malcolm Waters, Globalization (New York: Routledge, 2001),46.
Kelly-Kate S. Pease, International Organizations (New Jersey: Pearson Education. Inc., 2000), 36..
外交学院 2003 级硕士研究生毕业论文
and eventually 53,000 in 1997. The affiliates of these MNEs increased from 270,000
to 450,000, present in more than 160 countries. MNEs account for 40% of GDP,
50%-60% of international trade, 60%-70% of international technology transfer, and
90% of foreign direct investment. ① The fields for MNEs which were initially
restricted to industry or raw material extraction and processing, now extend to the
rapidly growing service sector, including banks and insurance companies, accounting,
advertising and consultancy bodies, and the hotel and leisure industries, such as
Citicorp, American Express, McKinsey and the Hilton and the Sheraton Hotel chains.
The growth of information industries also changed face of MNEs within the global
economy. Information technology has not only created new MNEs, such as Microsoft,
Sun Microsystems, and Apple, but has also enhanced the capacity of other
multinationals to operate across geographical and political boundaries.
The power of MNEs has become too massive to be neglected. The colossal scale of
transnational economic operation, solid financial basis and well-established networks
explain the prominent position MNEs have secured nowadays.
4.2 Challenges Posed by MNEs to Nation-States
MNEs are sources of investment, technology transfer and upgrading of labor force.
In recent years, MNEs’ rise to prominence has enhanced their restraining impact on
state control over economic affairs.
Obviously, MNEs are encroaching upon the territorial sovereignty of nation-states,
as they operate on a global basis, defying the restriction of borders, blurring the
concept of territory and accentuating the uncertainties of national jurisdiction. At the
same time, MNEs try to get rid of the supervision and regulation of national
governments, and try to avoid taxation, sharpen their competitive edge through
merger and acquisition, and monopolize production and consumption of certain
products, which consequently leads to the destruction of the economic governing
《经济全球化中的跨国公司》 (上海:上海远东出版社,1999)
外交学院 2003 级硕士研究生毕业论文
system of nation-states.
MNEs make decisions on the basis of optimizing the private profitability of the
corporations rather the economic health of particular nations. Such decisions include
whether and where to locate investment, how to articulate flows of resources and
semi-finished products within the global operations of the corporation, what intra-firm
prices to charge, and where to generate profit within the organization. Indeed, the
decisions made in such circumstances affect individual nations in multiple,
intersecting ways. MNEs thereby reduce the influence that governments can exercise
over the economic activities.①
Moreover, MNEs’ influence upon nation state is not just confined to the economic
field, but prevalent in cultural, social and political sectors. We might say MNEs are
placing restrictions on the capabilities of national governments in regulating economic
activities, protecting national economy and even in managing social and political
affairs. The expansion of MNEs arouses concern about the challenges faced by nation
states, as MNEs have grown so large and powerful that they are believed to be
undermining the sovereign authority of the nation-states, taking over the authority
from national governments and making nation-states a thing of the past.
4.3 Unchanged Role of Nation-States
Malcolm Rifind, Britain’s former Conservative foreign minister, once said to the
effect that multinational corporations operating freely across national borders does not,
however, mean that sovereignty has no future and most important of all, the
nation-states remain the cornerstone of international system. To say that nation-states
cannot ignore multinational enterprise is not to say that MNEs are typically beyond
any kind of national regulatory control or influence. And as we shall see, the
prediction that sovereignty would be held at bay and that the nation-states, confronted
with ever larger and more powerful transnationals, would wither away, is somewhat
Robert J. Holton, Globalization and the Nation-state (Basingstoke: Macmillan Press, 1998), 95.
外交学院 2003 级硕士研究生毕业论文
This perspective is reinforced by the fact that MNEs’ dependency on the nation
states is evident in a number of ways, resulting from common or compatible interests
rather than unilateral domination. In addition, in light of the high cost of
incompetence in the era of globalization, MNEs are not making nation-states
disappear, but on the contrary, are impelling nation-states to improve governance in
order to make full use of the presence of MNEs and harness globalization to their
4.3.1 MNEs’ Subordination to Nation-States: Home Nations and Host Nations
Generally speaking, as an entity surviving in the world political system, MNE is
willingly subordinated to and naturally dependent upon nation-states.
First of all, MNEs are profit-making corporations not only set up in accordance
with the laws and regulations within certain nations, but also operate in strict
compliance with these laws and regulations. They will and have to try to remain
consistent with the domestic policies and strategies instead of running the risks of
defying the positions of home nations. For example, in 1995, in order to isolate Iran
more effectively, American government decided to exercise more severe economic
sanction against Iran, including forbidding all the American oil corporations and their
overseas subsidiaries and branches in buying and selling oil in Iran and illegalizing
any other relevant trade activities. Despite the expected huge loss, American MNEs in
oil business made no other choice but to follow the nation’s policy.
In the case of host states, MNEs and their subsidiaries also have to operate within
the legal limits as legal persons since their rights and obligations are derived from the
laws of the host states. Respect on the part of MNEs must be shown to the laws, rules
of the states in which their profits are at stake. In many countries, especially the
developing countries, the financial status, the direction and scale of investment of
MNEs and even the introduction of foreign technology are subject to governmental
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control. MNEs have to accept the jurisdictions of nation-states in which they are
4.3.2 MNEs’ Dependency on Nation-States: Home Nations and Host Nations
Of course, obedience of MNEs doesn’t stem from their nature of making sacrifice,
but the reliance on national governments for survival and prosperity. The key
functions of nation-states are crucial to the development of MNEs, since high levels
of political stability and well-established infrastructure would certainly offer a reliable
environment conducive to the growth and expansion of their businesses. This applies
not merely to countries of home market, but also to host nations where affiliates are
Generally speaking, MNEs depend on nation-states for a good economic
environment. Markets do not, by themselves, solve all problems with which they are
confronted. Markets and individuals do not behave rationally; rather, markets and
investors often react irrationally, spurred by rumor and driven by unwarranted panic.
Market failure, government can make up by providing certain key functions: stability,
social order, property rights protection. As we know, states in the 19th century were
required to provide rules to regulate excessive competition and also structures to
encourage social consensus in face of economically generated conflicts, for example
between capital and labor. In the 20th century, similar state functions were required.
These included the intervention of economy by governments in 1930s, when it was
acknowledged that the economy is a government’s responsibility which should not be
left solely to the market.
Michael Porter has argued that the multinationals’ home market is a major base for
expansion and that national policies have a major bearing on the competitive
advantages that accrue to home-based MNEs. He links this point with the observation
that some nations’ MNEs, for example, those of the Japanese, have recently been
growing faster than those of other nations, irrespective of the industrial sector within
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which they are located. Also consider Boeing, Inc. Boeing receives billions of dollars
a year in defense contracts for its products—aircraft ranging from high-performance
fighter jets of transport and freight planes. These defense contracts permit Boeing to
develop aeronautical innovations paid for by taxpayer dollars, innovations that also
have commercial applications for civilian aircraft. Thus Boeing has a considerable
advantage over foreign producers seeking to compete in the civilian aircraft market.①
The national policies that have been seen as relevant to home-based competitive
success include the quality of the public education system, management training,
protection, and the investment in infrastructural items such as telecommunications.
These policies have been evident in Japan and Western Europe, and have contributed
to productivity growth, profitability, and employment.
In the addition to the creation of agreeable economic environment, home state
governments, more often than not, act as the strong backing behind the MNEs,
especially when their interests are threatened in other countries.
The actions of home-country governments of the MNEs which were in conflict
with the Mexico state during 1960s and 1980s exemplify the support home nations
can provide. The Mexico state was to nurture a national auto industry, and minimize
the proportion of foreign auto MNEs whose strong presence was obviously
obstructing the implementation of that policy. When Mexico State exhibited great
efficiency in dealing with the MNEs involved, MNEs had to resort to their own state
governments for a stronger bargaining power. In case of the Ford and GM (General
Motors), they were able to muster a formidable ally—the United States government.
Given Mexico’s dependency on the United States in matters of trade, finance, and
investment, pressure by the U.S. government had to be taken seriously. When the U.S.
government voiced its concern over the treatment of Ford and GM, the Mexican
government felt a need for circumspection, lest policy in the auto sector threaten the
wider growth strategy. Consequently, both Ford and GM were approved as wholly
foreign-owned subsidiaries. Likewise, Nissan the Japanese MNE of automobile was
Kelly-Kate S. Pease, International Organizations (New Jersey: Pearson Education. Inc., 2000), 158.
外交学院 2003 级硕士研究生毕业论文
able to gain entry to the Mexican market as another wholly foreign-owned firm since
the Japanese government had a lever that it was able to use: Mexico’s dependence on
Japan as an export market for its cotton. About 70 percent of Mexico’s cotton exports
went to Japan, Mexico’s most important trade partner after the United States.
A further type of governmental support to MNEs is best demonstrated in the
military and political support of the USA as a superpower. This power was
instrumental in the restabilization of Europe and Japan, which were to become major
sites for the operation of American MNEs.
Dependency on nation-states of MNEs is also evident in countries rather than of
their home base. MNEs need the host nations to exercise reliable policies, put into
place adequate infrastructures, and apply predictable regulations in order for them to
enjoy a preferential and stable investment environment. The destinations of the
investment of MNEs are illustrative of the differences nation-states can make in
attracting MNEs and also MNEs’ reliance on these differences in making their
decisions. The more stable a country is the safer MNEs profits will be, and the more
attractive the country will become.
Singapore, as an established economic power, is one of the favorite locations
attractive to MNEs. Political stability, open and honest markets-both for financial
services and a continued large commodity trade-constitute a fundamental attraction of
Singapore for foreign MNEs. Singapore has a long tradition of strong governmental
administration, which accounts for the adaptability of Singaporean economy in
meeting the changes in the international economy. In order to secure the gains from
the new flow of MNEs expansion, accept and cater for a very high foreign presence,
Singapore State paid attention to infrastructural development, government control of
the labor market as well as of savings and efficient planning, which proved irresistible
to foreign multinational enterprises. Singapore took in its entirety the MNE ‘package’
of capital, technology, entrepreneurship, management and marketing①, which is one of
the explanations for Singapore’s successful economic development.
W.G.Huff, The Economic Growth of Singapore (Cambridge: Cambridge University Press, 1994), 36.
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Nations without a sound economic environment will fail to attract MNEs. For
instance, Russian government’s intervention in economic sector has built up a
reputation for unreliable environment, thus hindering the influx of foreign investment.
And French government’s intervention of foreign take-overs of and joint ventures
with French businesses has also thwarted the adventure of MNEs. In the case of
volatile governance, the corrosive power is most fateful for the MNEs. Countries in
chaos or with temporary governance are the least likely places MNEs’ money will go.
4.3.3 The Power Shown by Nation-States in Dealing with MNEs
In considering the impact of MNEs on the sovereignty of nation-states, developing
countries draw the limelight, since on the one hand, most influential MNEs originate
from developed countries and on the other, developing countries appear more
vulnerable than developed countries in face of the penetration of MNEs.
National autonomy is clear in the case of economically advanced nations. Bailey et
al. in their review of relations between MNEs and governments, point to major
limitations on inward foreign investment, most notably in post-war Japan. Despite a
slow trend toward liberalization, the evidence is that Japan has only eased barriers
against foreign multinationals when circumstances were deemed to be in Japanese
interests. The key role of government policy in Japanese capitalist development is
Doubts may rise concerning the robustness of the sovereignty of developing
countries when faced with the unprecedented challenges by MNEs. The dilemma for
most developing countries is that economies may stagnate without MNE involvement,
but the price for bringing them in may be too high in terms of loss of control over
economic affairs or in relation to opposition for domestic economic and political
interests. In order to bring in MNEs for the interest of national economy, developing
countries are paying high costs. Deregulation, reduction of control over economy and
Robert J. Holton, Globalization and the Nation-State (Basingstoke: Macmillan Press,1998), 96.
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formulation of preferential policies towards MNEs are few among the numerable
moves taken by developing countries to attract MNEs. Some say changes like these
are shadowing states sovereignty, making the state less central to national
opportunities for development than it was in the past.
As we understand, MNEs remain dependent on nation-states for certain types of
resources in a range of circumstances. And it is not all clear that nations in general
lack bargaining power in dealing with MNEs. East Asian states- from Korea in the
North to Singapore in the South with the People’s Republic of China in the
middle-have used various strategies in which the state played a central role to cushion
the dramatic impact on domestic economy brought by MNEs.
Douglas C. Bennett and Kenneth E. Sharpe’s study of the strong role played by
Mexican government in safeguarding national interests has fully demonstrated the
resilience and power shown by a developing country when faced with the expansion
of MNEs.
The Mexico state adopted an industrial policy in an effort to shape industrialization
in the automobile sector between 1960 and 1980. In 1961-1962, in 1968-1969, and
again in 1977, there were there major episodes of bargaining between the Mexican
state and the transnational automobile firms.
In 1958, the Mexican state set itself the task of creating an automobile
manufacturing industry in Mexico. The conflict that ensued pitted for the first time the
Mexican state against foreign corporations in a manufacturing sector.
And as a
strategy of the administration, MNEs of different nations were pitted against each
other, and competition among each single MNE got intense. In the end, Ford had
expressed a willingness to commence manufacturing under the right conditions, and
the others were then quick to indicate their willingness as well.
The second round followed shortly. Scarcely seven years after it had compelled the
world’s major automobile firms to commence manufacturing vehicles in Mexico, the
Mexican government had pushed them a step further into undertaking automotive
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exports. MNEs agreed to the governmental policy o exports because the alternative
proposal of merger policy for a single large Mexican firm would make it even harder
for MNEs to compete under such requirements. The export-oriented automobile
policy promised to generate foreign exchange to meet the country’s import bill, spur
further industrialization, and provide new sources of employment.
For the third round, the 1977 decree pressed forward vigorously with export
promotion. The MNEs were compelled to make substantial investments in their global
operations in any event. GM announced the start of an investment program designed
to generate sufficient export volume to comply with the decree. Once GM had made
its move, the other firms quickly followed suit.
The efficiency and capability presented by Mexico State during these rounds of
negotiation with MNEs shows that national governments are strong and capable in
bringing MNEs under regulation and control, rather than remain weak and helpless as
some may have claimed. The study of is in defiance of the arguments that states are
passive and powerless in face of MNEs. It captures the consequences of MNEs for
developing countries, and the possibilities for altering these consequences by state
action. Although it is a study focusing on the time period from 60s to 80s, it serves as
an instructive way to look at the relationship between nation-state and MNEs
4.4 Strong State, Strong Economy
The expansion of MNEs, alongside other processes of globalization certainly
contributes to the impact on state authority, but the impact is not as fully negative as
some views have claimed: state involvement in economic affairs is seriously restricted.
Existing cross-national statistics suggest that greater reliance on trade is associated
with an increased role for the state rather than a diminished one. Moreover, a look at
the nations that have been most economically successful over the last thirty years
suggests that high stateness may even be a competitive advantage in a globalized
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economy. Singapore is the most obvious case in point.
Singapore is an economic development success story. With three million people, the
island ranked in 1990 as the world’s eighteenth largest exporter of merchandise, and
thirteenth in commercial service exports; merchandise exports were three times those
of the whole of India. By the 1990s few commercial decisions relating to Southeast
Asia could be taken without reference to Singapore; almost any multinational
enterprise, whether in manufacturing or services, planning to expand outside North
America, Western Europe or Japan world naturally consider it as a location①.
Singapore is not only a highly internationalized economy in terms of its extreme
reliance on trade, but it is also exceptionally dependent for its local economic
dynamism on foreign direct investment by MNEs. At the same time, it is equally
renowned for the capacity and power of its state bureaucracy. Its success suggests that
successful participation in global markets may be best achieved through more intense
state involvement.②
Singapore’s development relied on a combination of external free trade and strong
internal economic control. In Singapore’s economic development, the commitment of
the political leadership to economic development was total, and featured strong, if
selective intervention.
An activist government committed to development guided Singapore’s economic
transformation. With the development of globalization since 1960s, a new flow in the
world economy quickly began to gain strength: the investment made by MNEs in
search of low-cost locations for the manufacture- or, often, assembly- of goods with
low value-added per worker for export to the West. Interventionism in Singapore
aimed to adapt the domestic economy to the requirements of the international
economy. Singapore turned decisively to achieve export-oriented growth almost
entirely through foreign multinationals.
W.G.Huff, The Economic Growth of Singapore (Cambridge: Cambridge University Press, 1994), 1.
Peter Evans, The Eclipse of the State? Reflection on Stateness in an era of Globalization, World Politics 50.1,
(1997): 62-87
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In order to attract foreign MNEs, Singaporean government made heavy
infrastructural investment. The Economic Development Board (EDB), as the
government’s agent, was set up as ‘the spearhead for industrialization by direct
participation in industry’ and building necessary infrastructure. ① In addition to
infrastructural development, great planning was effected through government control
of the labor market as well as of savings. Together with the political stability, sound
and open market, Singapore was able to attract a majority of the MNEs and took great
advantage of the presence of MNEs for the development of its economy.
The means by which Singapore achieved its rapid manufacturing development are
summed up in the explanation that they imported entrepreneurs in the form of
multinational corporations and the government itself became an entrepreneur in a big
way. Although interventionism could therefore be regarded as selective, there was
total government control of those parts of the domestic economy crucial to
international competitiveness. The Singapore model carries the lesson-perhaps in its
most emphatic form- that an extensive role for the government is helpful to the
development of national economy in face of the expansion of MNEs.
4.5 The Enhancement of Nation-States’ Role as Required by MNEs
From a different perspective, the expanding influence and undeniable importance of
MNEs does not necessarily cast clouds over the future of nation-states’ authority. On
the contrary it offers opportunities and incentives for national governments to
undertake a wide range of institutional reforms and organizational changes for
effective public sector policy and service delivery operations in order to adjust to the
requirements of MNEs and secure a promising future.
The costs of incompetence can be high in volatile and integrated markets. Therefore
nation-states are forced to improve their efficiency in economy management and
public administration. Governments are motivated to improve governance which
W.G.Huff, The Economic Growth of Singapore (Cambridge: Cambridge University Press, 1994), 307.
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emphasizes flexibility, responsiveness, transparency and accountability. This is what
Singaporean government has always done to respond to changes in the international
economy and the resulting requirements of foreigners. Its willingness to accept
foreign enterprise from the late 1960s continued a long tradition of adaptability. These
shifts optimize governments’ capabilities in economic management and public
administration, thus consolidate the sovereign authority of nation-states.
And in order to safeguard the national interests, the governments of developing
countries are driving a hard bargain against MNEs and taking as many measures as
possible to offset the undesirable side effects. In addition to the essential improvement
of domestic governance, developing countries are also keen on inter-governmental
cooperation to take into consideration of the whole scenario. OPEC was set up in
denial of the argument that nation-states remain weak or powerless victim. Its
achievements show that there are strategies open to governments in an era of MNE
penetration. The availability of these strategies and the improvement of governmental
administration indicate the possibility of government autonomy in the setting of
national goals and the implementation of national strategies in face of the penetration
of MNEs.
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Marginalization and the Role of Nation-States
5.1 The Phenomenon of Marginalization in the Era of Globalization
It is very true that globalization is a significant phenomenon transforming the world
more rapidly and dramatically than ever before. Globalization does bring faster
growth, higher incomes and enormous opportunities. However, it should be noted that
globalization has generated as many benefits as it has engendered new risks. It can
serve to consolidate inequality between nations, and lead to the exclusion of states and
individuals left behind by this progress.
The problem of course lies in the uneven benefits brought by globalization, in the
fact that some are blessed with unparalleled opportunities, while others have been
completely marginalized. This force is storming through the developing countries like
a tornado, with consequences that are far from beneficial for most of the
disadvantaged countries. For these countries, instead of flourishing economic scenes,
what they get familiarized is the slow growth of the industrial sector, sluggish
evolution of the agricultural sector and an infantile level of technology application.
5.1.1 The Scourge of Marginalization Brought by Globalization
The signs of imbalance in world economic development, especially between the
rich countries and the disadvantaged countries, are evident amid the highly-claimed
universal prosperity.
While the share of developed countries in world income increased from less than 73
percent in 1980 to 77 percent in 1999, that of developing countries stagnated at
around 20 percent (UNCTAD, 2002, Chapter 3). The share of developing countries in
the global distribution of wealth has shrunk. UNDP data on the global distribution of
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wealth between industrial countries, developing countries and the former USSR and
Eastern Europe (table 1) show that wealth distribution has become more unequal.
Between 1960 and 1994 the share of developing countries, and particularly that of the
former socialist countries of Central and Eastern Europe, shrank while that of Western
industrial countries increased.①
Industrial countries
Sources: UNDP data base.
We may be amazed at the fact that the world’s total product has quadrupled and the
real per capita world product has doubled. But it is equally shocking to realize that a
large proportion of humankind is denied the participation in world economic
prosperity. As one author has recently summarized their conditions:
1.3 billion persons, that is 22 percent of the world’s population, lives below the
poverty line… As a consequence of such severe poverty, 841 million persons (14
percent) are today malnourished; 880 million (15 percent) are without access to health
Paul Streeten, “Globalization: Threat or Salvation?” in Globalization, Growth and Marginalization, eds. A.S.
Bhalla, (Basingstoke: Macmillan Press Ltd, 1998), 24.
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services; one billion (17 percent) are without adequate shelter; 1.3 billion (22 percent)
are without access to safe drinking water; two billion (33 percent) are without
electricity; and 2.6 billion (43 percent) are without access to sanitation.①
Apparently, marginalization is most pronounced on the African continent. Among
the 49 least developed countries reported by the United Nations, 34 are in Africa.
Locked in an unequal exchange with the developed world, Africa has been
transformed into undeniably the poorest continent. In the past half century,
globalization proceeds at an accelerating pace, but it is during the same half century
that Africa is more marginalized within the world economy than at any time.
The inadequacy of Africa’s global integration is evident in its falling share of world
trade, investment and IT, which have declined to negligible proportions. According to
research, Africa with 11% of world population accounts for only 1% of world GDP,
1.5% of world trade, and attracts only 1% of world FDI. The low GDP levels and poor
growth rates of most African countries have resulted in poor telecommunications
infrastructure and low teledensity levels. The number of internet users across the
whole African continent is less than that of Luxemburg, a country with only 440,000
5.1.2 Roots for the Marginalization
From the above, we come into face with the disquieting fact that gap has widened
in the phenomenon of globalization while it is expected to narrow the disparities and
slash the number of poor countries with its instruments of free trade and liberalization.
Many developing countries, mainly but not exclusively in Africa, are truly
marginalized. And the universal goals of halving poverty and providing universal
primary education by 2015 seems to be mere figures with no hope whatsoever of their
being achieved in light of the present situation.
A saddening factor contributing to the marginalization is the unfair trade
David Held, A Globalizing World? (London:Routledge,2004),174.
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environment created by the economic dominance of the developed countries. Trade is
supposed to present enormous potential to accelerate the process of achieving
Millennium Development Goals. But the potential is undermined by the existing trade
policies. The unfair trade policies adopted by developed nations frustrate the efforts of
poor countries in wriggling out of the grip of poverty, and cast this inequality into
UNCTAD still maintains that developing states are caught in a perpetual cycle of
poverty and underdevelopment because of their disadvantaged position in the
international division of labor. Their export income is derived from low-profit
primary products, rendering them vulnerable to economic expansions and contractions
in the global economy.①
In 1999 for almost all developing countries imports expanded faster than exports,
resulting in a deterioration of their trade balance. What is crucial here is the category
of goods that are being exported. The UNCTAD report suggests that exports from
developed countries are products with high global demand and large market potential,
while that of developing countries mainly comprises of products with sluggish
demand and potential excess supply. Table 2 shows the share of the world market held
by developing countries and the main exporters of what UNCTAD identified as the
ten most market-dynamic products for 1998.②
Table 2 shows that developing countries are enjoying a share in the markets for
some dynamic products, but developed countries continue to dominate most markets
in these goods. There are no examples here of African or South American countries
being able to derive much advantage. Furthermore, the table hides the fact that much
of the contribution of developing countries is in low-skill, low value-added assembly
stages of global production networks, as in electronics.
Protectionism in the guise of social, environmental, health and safety standards is on
the rise, despite the accentuation on free trade promised by globalization. Tariff levels
Kelly-Kate S. Pease, International Organizations,2nd Edition,34 (New Jersey: Pearson Education. Inc. 2000).
David Held, A Globalizing World? 2nd Edition, 119(London:Routledge,2004)
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and the frequency of subsidy peaks are still high in many areas of export interest to
developing countries.
TABLE 2 Exports of market-dynamic products
Product group
Share of world Main
market held by countries(%)
Transistors and semiconductors
USA(17) Japan(15)
USA(13) Singapore(13)
Parts of computers, office machines
USA(17) Japan(14)
Optical instruments
Japan(22) USA(17)
Perfumery and cosmetics
France(28) USA(12)
China(70) Germany(9)
Knitted undergarments
China(16) USA(8)
Plastic articles
USA(14) Germany(13)
Electric power machinery
USA(11) Germany(10)
Musical instruments and records
USA(20) Japan(12)
Source: adapted from UNCTAD, 2002, Table 3.2
Although rich countries have always promised to lower the tariff on imports from
developing countries and slash subsidies by a large margin, neither of these promises
are delivered. The highest trade barriers are erected against the poorest countries in
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the world, and generally speaking, the obstacles faced by developing countries in
exporting to rich countries are three times that of the exporting between rich
Developed countries must realize that the scourge of under-development can shake
the very foundations of the international system devised by them. Global equity is the
only assurance of shared peace and prosperity. However, as a percentage of their GDP,
the total development assistance of low-income countries according to the World
Bank classification fell from 2.1 percent in 1985 to 1.3 percent in 1998. For
middle-income countries it fell steadily from 0.9 to 0.4 percent, while for the subset of
these countries classified as lower-middle-income countries it fell from 2.0 to 1.0
percent. We therefore find that development assistance as a whole, to low- and
middle-income countries, has been declining in importance. (see table 3.)
TABLE 3 Development assistance percentage of GDP①
Lower-middle-income 2.0
Source: World Bank, World Development Report, various issues.
Transfer of resources in the form of international assistance from the rich countries
has continued to decline while the transfer of resources from the poor countries to the
Amitava Krishna Dutt, “Globalization, North-South uneven development and international institutions” in The
Role of International Institutions in Globalization, eds. John-ren Chen (Massachusetts:Edward Elgar Publishing
Inc., 2003), 120.
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rich in the form of debt repayments has continued to swell. The total external debt of
developing countries has increased almost by 6 per cent over the amount of debt in
1997 and stands at 2.5 trillion dollars. The debt burden is like cancer to their
economies, eating away their meager resources. While piecemeal efforts are being
made to address the issue, we believe that only a comprehensive and durable solution
of the external debt problems would help in releasing resources for development.
5.2 Managing the Challenges of Globalization: the Role of Global Governance
and National Governments
Globalization brings unprecedented economic integration, but also intensifies
inequality. Managed well, globalization can create foundations for economic growth
and development at both the national and international levels. Managed poorly
globalization could lead to further marginalization and impoverishment of the
disadvantaged world. Neither outcome is predetermined. It depends on the policy
choices adopted by national governments and the international institutions. This has
posed severe challenges to national governments as well as global governance to
reverse the unhealthy trend introduced by globalization by improving their service and
policy delivery.
5.2.1 What the Global Governance Can Do
The international community has an important responsibility in ensuring the equal
benefits distribution of globalization. The challenge before us is to ensure that
developing countries are well positioned to take advantage of the opportunities
offered by integrating into the world economy. We must undertake collective action to
realize the goal of universal prosperity, as enshrined in the UN Charter.
No amount of globalization, marketization, liberalization or interdependence is
going to make a difference, unless it is based on democratic principles, applicable to
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world development. Furthermore, as the Pakistani Ambassador so eloquently spoke
on behalf of his country, what is needed is not globalization of the world economy but
globalization of development. Unless a modicum of balance and symmetry is restored,
the world will probably be heading toward implosion.
We need more effective global governance to achieve a wider distribution of
opportunity in the international economy and manage globalization so that it includes
rather than marginalizes poor people. The international economic system remains
based on an unequal power structure. The imbalance of economic power between the
developed countries and the developing countries are deep-rooted. There is need for
strengthening global cooperation and action to address the growing problems of the
unequal economic system. Remedy the imbalances in the structures of global
economy with new efforts to create a more equitable system.
The priority area that needs immediate attention is to strengthen the capacity of
multilateral institutions to address the issues of trade, finance and development in an
‘integrated manner’. The institutions responsible for ‘rule-making’ in the
globalization process (IMF, WTO, and the World Bank) should be made more
democratic and transparent. There is ‘a fatal flaw’ at the heart of the existing system
of multi-layered global governance-namely, its lack of democratic credentials and
legitimacy. At present, international institutions, including the World Bank, the IMF,
and the WTO, have done little to stem the strong forces of uneven development in the
international economy, and by promoting the liberalization of trade and capital flows,
and by protecting intellectual property rights, and by not promoting the greater
mobility of labor, they may well have exacerbated the forces of global uneven
The last decades have enabled us to understand more clearly the interdependence
which now unites all the nations. It is clear today that the countries of the ‘North’ can
no longer formulate their economic policies without reference to the countries of the
Amitava Krishna Dutt, “Globalization, North-South uneven development and international institutions” in The
Role of International Institutions in Globalization, eds. John-ren Chen (Massachusetts:Edward Elgar Publishing
Inc,2003), 128.
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‘South’, any more than the latter can define their development strategies without
taking into account the situations and actions of the industrial nations.① The industrial
countries’ policies will in part determine the results obtained by the developing
countries. The elimination of protectionist support measures, especially in agriculture,
textiles and clothing sectors and the issue of debt relief, access to technology and
development finance should be addressed on a sustained basis by the developed
countries as well as the global governance as a whole.
5.2.2 Challenge for National Governments
While stressing the need for new integrated structures of global governance, we
must also accept that it is important for governments in developing countries to make
efforts to avert political alienation and social exclusion. It is clear that the prime
responsibility for their development will lie with the disadvantaged countries
themselves and that their economic performance will depend mostly o their own
Since globalization can have economically and socially destructive consequences it
is a great challenge for national governments to improve governance at both the
national and international levels for successful management of globalizations.
Internationally, globalization is creating new forms of political inequality as some
states and powers lie at the heart of the contemporary system of regional and global
governance and others—essentially the developing countries—remain at the edge of
involvement. Participation in global governance is skewed. Smaller and poorer
developing countries have little voice in global decision making. Under these
circumstances, developing governments shall enhance cooperation and solidarity
between each other in order to form a stronger voice in the world system. As Julius K.
Nyerere once said, “We the countries of the Third World, are thus being forced to face
up to another reality; that while we are weak separately, we could have strength if we
Jacques Loup, Can the Third World Survive? (Baltimore: the Johns Hopkins University Press, 1983), 212.
外交学院 2003 级硕士研究生毕业论文
acted in unity.” ① The developing countries shall work together for the new
international economic and political order. The efforts made to achieve policy unity of
the main developing continents are impressive. However they are far from enough in
terms of the extent and scope. Much more remains to be done.
Within the territories, national governments of developing countries are challenged
by the inflow of external forces. Clearly, The Asian financial crisis shows that
developing countries lack the capacity to regulate financial markets and foreign
investment. It is an ungentle awakening to the need for rapid reform in financial
institutions and the need to move quickly to put regulatory system in place and
maintain macroeconomic stability in the midst of international volatility and national
vulnerability. Moreover, in face of the acceleration of globalization, national
governments are being increasingly forced to cope with the commercial clout of
MNEs, which are growing more powerful than ever before. This has resulted in the
need of market reform to take advantages of MNEs for the national economic
It is equally important for governments in developing countries to combine markets
reforms with reforms to retool governance institutions. There is thus a need to
undertake a wide range of institutional reform and organizational changes for
effective public sector policy and service delivery operation. The focus should be on
increasing the democratic nature of existing governance institutions and designing
new institutions that can promote equitable participation and decision-making, so as
to address the pressures for enhancing democratic space. This shift reflects a
conceptual change in governance that features transparency and accountability.
Another crucial point lies in policy and management. For the disadvantaged
countries a modification of development policies seems necessary. Several priorities
appear to be essential for such reorientation.
The experience of three decades has shown that economic growth did not always
Ahmad Abubakar, Africa and the Challenge of Development: Acquiescence and Dependency versus Freedom
and Development (New York:Praeger Publishers, 1989), 53.
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suffice to ease the burden of poverty. The reorientation of governmental policies
toward the underprivileged should be a priority. Taking into account the needs of the
poorest, the development of agriculture, on which the vast majority of these destitute
depend, will play a fundamental role. Statistical evidence has challenged the idea of
an automatic diffusion of the profits of growth and a majority of destitute people earn
their living from agriculture, a reorientation of development strategies in favor of this
sector could lead to an improvement in their living conditions.① Only if we undertake
to improve directly the living conditions of the destitute will poverty eventually be
Reconciling the two imperatives of high growth and equitable distribution
constitutes a real problem which cannot be evaded. Part of its solution presumably lies
in giving priority, among the measures in favor of the poorest, to those programs
which increase these people’s productivity. Statistical studies have shown that not
only improvement in nutrition and health but also education has a significant impact
on the productivity of the poorest workers. It became possible to declare that
‘investing in man’ would increase productivity and consequently accelerate economic
At the same time, the ongoing efforts to reduce demographic growth must be
intensified. The development of commercial and traditional energy resources will
have to receive equal attention too. Finally, because of the foreseeable increase in
their import requirements, these countries will have to strive to increase their exports
in order to obtain the foreign exchange required for these purchase.
After all the suggestions for policy orientation above, one more thing should be
noted is that the importance of policy lies not merely in terms of shift of emphasis to
agriculture and rural development or form outward-looking to inward-looking
development strategy, but also in durability. Policies of African governments seem to
be characterized by rapid change and consequent inconsistencies and hence are
Jacques Loup, Can the Third World Survive? (Baltimore: the Johns Hopkins University Press, 1983), 164.
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marked by lack of clearly defined long-term goals.① And the same is true of other
developing countries. Constancy and durability of government policies are essential to
the efficient implementation of the national strategies and planning of economic
development and the final eradication of poverty.
Marginalization is one of most severe challenges faced not only by the
disadvantaged countries but the world as a whole in the era of globalization. National
governments, especially those of the marginalized world, are entrusted with the great
mission of putting an end to this destructive trend. With the improvement of
governance and enhancement of international cooperation, states are posed to
eliminate this phenomenon and manage globalization to the benefit of the whole
human society. In accomplishing this great cause, the central role of national
governments is once again accentuated.
Ahmad Abubakar, Africa and the Challenge of Development: Acquiescence and Dependency versus Freedom
and Development (New York:Praeger Publishers 1989), 48.
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The irreversible trend of globalization has generated enormous impact on the
sovereignty of nation-states. The new forces nurtured by globalization are affecting
national sovereignty in various ways. The growth of international governmental
organizations (IGOs) and international non-governmental organizations (NGOs) are
threatening the authority of nation-states on the national and international levels; the
expansion of multinational enterprises (MNEs) and the intensification of
marginalization of the poorer countries are challenging the capability of national
governments in shaping domestic policies and dealing with global affairs.
However, it is found out that nation-states possess the power to regulate or override
these global forces. National governments are not so much losing power but having to
adjust to a new context in which their sovereignty is exercised in a more flexible and
efficient way.
IGOs are organizations within the framework of the principle of sovereignty. As
instruments of nation-states for the pursuit of national interests, IGOs are based on the
recognition and support of member states, which proves unsupportive of the
unrealistic prediction that they are superseding nation-states in handling international
NGOs are more of a help, less of a threat to nation-states. Their inextricable
dependency on nation-states in fulfilling missions, lack of legal status and serious
inherent weakness all show inarguably that NGOs are not surpassing nation-states
either in status or in terms of function.
MNEs can influence the actions of governments as they carry enormous weight in
promoting economic development. But nation-states appear confident in dealing with
the restrictions placed by MNEs in managing economic affairs. This confidence stems
from MNEs’ subordination to and reliance on nation-states for their very existence
外交学院 2003 级硕士研究生毕业论文
and development. MNEs have to abide by the laws and regulations of the nations in
which they are present and need the relevant governments to deliver key functions for
a reliable economic environment conducive to their development. The nation-states,
whether in Western world or developing world, have proved much more resilient in
matters of economic self-determination than some have predicted. The compromise
and cession of certain sovereign rights by nation-states under certain circumstances
are ways to achieve greater purposes.
Globalization has been given credit for the unprecedented economic growth, but
marginalization of the poor low-income countries is the other side of the coin. The
exclusion and marginalization of the disadvantaged countries have posed a severe
challenge to the whole world, especially the national governments of the developing
countries. It is important for the governments of developing countries to strengthen
sovereignty in order to fight against the unjustness entailed by the present unequal
international economic system, and enhance governance to ensure the benefits of the
global economy are extended equitably. During this battle with poverty, the key role
of nation-states stands crucial.
An analysis of the real situation shows that globalization is not heralding the end of
nation-states or the demise of sovereignty. Rather than the end of the nation-states,
globalization is reaffirming the centrality of national governments to the management
of human affairs. And the sovereign authority of nation-states remains fast and firm.
Therefore we say despite global changes, state sovereignty remains king.
外交学院 2003 级硕士研究生毕业论文
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