THE GLOBALISATION PROCESS
IMPLICATIONS TOR TANZAIA
AND
ITS
Address by Ambassador Ami Mpungwe to the CEOROUNDTABLE, KILIMANJARO HYATT REGENCY
HOTEL, DAR ES SALAAM, 9th OCTOBER 2012.
INTRODUCTION
May I begin by stating the obvious and say: the World
has changed! The end of Cold war and significant
developments in Science and Technology, over the last
few years, particularly those brought about by the
convergence of Information and Communication
Technologies (ICT), have already transformed the
world that we knew, not too long ago, beyond
recognition.
They have re-defined almost everything that
distinguishes and separates the human from the rest of
the animal kingdom. This change and transformation
process is engulfing the entire world and is already
impacting heavily on systems of political and social
organization, governance and wealth creation across the
world. And this change and transformation process is
happening at an alarming speed. As a result, even the
nature CHANGE itself has also CHANGED!
Any attempt, therefore, that seeks to understand the
fundamentals of this change process and its implication
to the nations of the world, including Tanzania, should,
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in essence, begin by developing an objective and indepth understanding of the nature and character of this
change process and the New World that is fast evolving.
In that regard, Thomas Kuhn, the famous historian
who has done a lot of work on the concept of paradigm
and paradigm shifts, has this to say, "You don't see
something until you have the right metaphor to let you
perceive it'
THE DRIVERS AND DYNAMICS OF THE ONGOING GLOBAL CHANGE
The journey towards the “right metaphor”, at the very
beginning, would reveal that at the core of this
paradigm shifting process, there are five key drivers
that characterize the on-going global changes, namely:
1) HUMANISATION:
OPTIMISING
FREEDOM AND CAPACITY
HUMAN
It is characterized by a profound commitment to the
universal values of Democracy; Fundamental Principles
and Practices of Human Rights and Rule of Law, and;
Best Practices of Good Governance, in terms of
transparency,
effectiveness,
responsiveness
and
accountability. Issues related to Gender equality and
citizen empowerment also form integral part of this
process.
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Obviously, the logical consequence of this process comes
out in terms extending the frontiers of human freedom
and liberty, to their fullest extent and in a very
indivisible manner, across the world. In the process, it is
also meant to optimize the human potential and
capacity to act in both, facing the difficult challenges
and exploiting the vast opportunities that are brought
about by the Globalisation process.
2) GLOBALISA TION
Globalization works to coordinate and integrate,
production, distribution and exchange process across
the world, with the view to taking full advantage of the
existing or potential economies of scale and scope, in a
manner that lowers production costs, increases
efficiency and productivity and gain global
competitiveness either for individual businesses or in
inter-state or inter-regional trade and economic
relations, as world economies become increasingly
networked together, at the global scale. In the process,
political, social, legal issues etc that are associated with
such production, distribution and exchange processes,
are equally networked and integrated at the global
scale, hence the intensification of the phenomenon of
globalization.
As a consequence of this process and in spite of the ongoing global financial melt-down and economic downturn, we are currently noticing a major upswing in the
phenomenon of Mergers and Acquisitions at both,
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domestic and cross-border levels, largely by large
corporate entities of the North. For instance, in 2007,
before the onset of the Global Economic and Financial
Crisis in 2008, Mergers and Acquisitions in the global
gas and electricity sectors alone rose by 52 per cent to
an all time high of almost US $ 300bn, driven by big
European deals. At the same time, the total value of
deals in 2006 was US $ 298.8bn, compared with US $
196bn in 2005. Similar tendencies are noticed in all
other sectors across the world, on daily basis!
Associated with this process, there is also an enhanced
tendency for consolidation of fragmented industries at
both domestic and cross-border levels, throughout the
world today, all pointing towards the globalizing
character of the evolving New World Order.
3) LIBERALIZATION
At the same time, the Liberalization process, as we are
all very much aware, works to open up domestic,
regional and global markets, albeit some hitches here
and there; encourage free movement of goods, services
and other factors of production, throughout the world.
The obvious effect of this process comes in the form of
transforming national boundaries into markets and
putting trade issues quite high in the global agenda,
second to war issues! The formation of sub-regional and
regional economic blocs has already become prominent
feature of this process, as nation- states implement
different growth strategies that are meant to expand
economies of scale, enhance productivity and leverage
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global competitiveness. Tendencies to cling on falsenationalisms of the past viz-a-viz regional economic
collaboration increasingly continue to receive serious
challenges!
4) DIGITALIZATION
As I had indicated earlier on, significant developments
in Science and Technology over the last three decades
or so, through the convergence of Information and
Communication Technologies, is indeed, transforming
the world into a global village that it is to- day.
It has already rendered the differences in Time, Space
and Distance, completely meaningless and irrelevant in
today’s world of business or politics! The Digitalisation
process continue to significantly transform the manner
in which, individuals, organizations and even nations,
live, interact, communicate, learn, work, compete and
even play. But perhaps, most significantly, it has
already eliminated a lot of traditional' jobs and
traditional ways of doing things, as my own experience
in the diplomatic service indicates. While Digitalization
comes with a lot of its own challenges, it has also opened
up, new and vast opportunities for creating worth and
reorganizing various aspects of human endeavour,
particularly as it is characterized and underpinned by
growing efficiencies in Information Technologies and
plunging costs of telecommunications!
ENVIRONMENTALISATION
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This process, as we are all very much aware, focuses on
renewed and intensified concern and care for the
environment, in the quest for sustainable development
and the very survival of the human race!
CHARACTERISTICS OF THE NEW WORLD OF
GLOBALISATION.
The dynamic interplay between and among these global
drivers, has created a global environment of political
and social organization, wealth creation and service
delivery that is characterized by extreme instabilities;
profound discontinuities; wide-spread uncertainties;
growing unpredictabilities, as well as the most intensive
competition for markets and resources ever witnessed
in recent human history!
Much as there are serious efforts to regulate, control
and codify various aspects of this global process,
nobody as yet, seems to be in control of the intensified
globalization process! On the other hand, this process is
so all-encompassing that there is nowhere to hide!
Many of the old philosophies and power structures are
collapsing and new ones are taking shape. The notion of
Power has equally transformed and no longer comes
from above but increasingly it emanates from below, in
so many different ways!
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The dynamic interplay between and among the various
drivers of the Globalization process has triggered a
profound transformation in doctrine, concepts,
structures, systems and styles of governance in both
public and private sector organizations.
In the business world, for instance, there have been
significant shifts in corporate governance and
management philosophies, from Adam Smith's division
of labour to the minutest task; Taylor's Scientific
Management, Total Quality management of the 1980s,
to the current considerations for Learning
Organization, Six SIGMA and, particularly, the IT
driven Business Processes Re-engineering (BPR) and
Enterprise resources Planning (using such software
programmes as SAP, Oracle, People Soft, etc).
As a result, in the business environment, customers and
consumers, wherever they are in the world today, are
much better informed of their wants and needs, for
goods or services and at a specifically defined quality
and price. Similarly, in politics citizens and voters,
wherever they are in the world today, are much more
aware of their political, constitutional, legal and human
rights, than at any other point in human history. This is
reflected in the new trends and approaches to politics
and political organizations, taking into full account, all
aspect of demographic and technological changes!
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The notion of civilized State is now increasingly being
defined, terms of the existence of sustainable peace and
stability as well as the level of Humanization that a
given State has attained, i.e. strict adherence to
Universal Values of Democracy, Human rights, Rule of,
Law and Good Governance. This has become such a
fundamental political requirement that it has even
attracted some strong economic conditionality for
modern business.
Investments and modern
technologies would shun or move away from any
political environment that either, does not subscribe to
or fails to apply or live by these fundamental and
universal values. Similarly, the notion of power and
influence is progressively, less determined by military
or political might!
Increasingly, the notions of power and influence are
assuming a socio-economic character, largely through
higher levels of humanization, economic growth,
productivity and competitiveness that a nation attains,
at the global market place.
As a result, issues of Global economic competitiveness
have substantially assumed the centre-stage in both
public and business governance. In that regard, most
governments throughout the world, have significantly
reviewed and re-defined their roles as well as sizes,
consistent with the political and economic challenges of
Humanization, Globalization, Liberalization and
Digitalization.
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There have been significant reforms and restructuring
of government structures, with a lot of the traditional
responsibilities either moving out of government
domain or being out-sourced to the private sector. The
ultimate objective is to enable governments, through
best practices of Good governance, to contribute
significantly to the creation of the most conducive
environment, in which both the economies and
businesses would grow and thrive.
On the other hand, the private sector is increasingly
being entrusted with the role and responsibility of
being, the most effective engine for economic
transformation and growth, in almost every country of
the world, including the former Communist State.
The central focus for many nations and business
organizations to-day is to attain higher productivity and
global competitiveness, through the most efficient use of
human, physical and natural resources. Success of
failure by nations and business organizations would
very much be influenced by their ability to deal the
challenges as well as the capacity to exploit the vast
opportunities that are located within the dynamic
interplay between and among the five drivers of
Globalization.
IMPLICATIONS TO THE THIRD WORLD
Defining the on-going global changes and the emerging
characteristics of the New Order in this manner,
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therefore, poses significant challenges to the Third
World countries, particularly, the African continent,
which has variously been described to be the “world's
biggest development challenge”.
As Third World countries, concurrently endevour to
resolve the legacy problems of their colonial past; find
answers and solutions to the prevailing political and
economic difficulties and, at the same time, face the
enormous challenges that are located within the
evolving New Global Order of globalisation, as they
work to define and determine their development path
into the future.
WHAT IS TO BE DONE?
This leads us to the final part of my presentation that
seeks to suggest what needs to be done by countries like
Tanzania, in response to the difficult challenges and
some kind of opportunities that are brought about by
the on-going Globalization process.
In that regard, the first thing that countries like
Tanzania need to do in response to the globalization
process, is to develop an in-depth understanding of the
character and dynamics of such global changes and
developments. Tanzania is a constituent part of this
global system and we cannot hide from its
developments. I say this because, to a large extent, we
Tanzanians have developed a tendency of being
disinterested players or observers of the ever changing
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global environment. While in the past, we used to be the
guiding light and source of inspiration to the rest of
Africa and indeed, the Third world in general, we have
now taken the back seat! On the other extreme, there
are some among us who even believe the world revolves
around Tanzania, on issues of change and development!
Here one needs to draw a lot of inspiration from
countries like India, China, Malaysia and other Far
Eastern Nations in the manner that they have been able
to understand and respond to the difficult challenges of
globalization as well as exploit the vast opportunities
that are also brought about by the Globalization
process. The issue of visionary and effective leadership,
therefore, becomes extremely relevant in this regard!
The second point, therefore, relates to our own capacity
to develop appropriate and effective policies and
strategies that are consistent with own internal
demands as well as global realities. Effective execution
and follow through by both public and private sector
structures and system becomes critical to eventual
success. Systems of Governance therefore need a
thorough review consistent with the huge development
challenges that we face at the moment.
In that regard, we constantly need to keep our aerials
and radar on as we monitor major global events that
heavily impact on our development challenges at home!
We therefore, need to be ever flexible and adaptive to
change!
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Thirdly, in both public and private sector governance
systems, we need to develop and nature the culture and
spirit of constant innovation, that is consistent with the
demands and realities of the global changes.
Fourthly, to the extent that we depend on FDI and
indeed, we cannot seriously develop without such inputs, we need to develop an investment and business
environment that truly sets us apart from our
immediate competitors, not necessarily in terms of
generosity of our incentive but largely in the easiness of
doing business.
We therefore, need to brand Tanzania in a manner that
offers world-class value proposition and experience!
Finally, we need as a nation, in our various governance
structures and systems, to attract, develop and retain
talented Young People. The quality of our education
system therefore, holds the ultimate key in the extent to
which we can make appropriate and effective responses
to the domestic and external developments brought
about by Globalization process.
In all this issues and challenges, the private sector in
Tanzania has a strategic role to play in enabling
Tanzania to effectively meet the difficult challenges and
exploit the vast opportunities that come with
Globalisation.
The biggest challenge therefore, remains as we have
seen: to prepare for the future that you can not predict!
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In that regard, it remains true as Charles handy puts it:
“THE GREATEST EXCITEMENT ABOUT THE
FUTURE IS THAT WE CAN SHAPE IT”
In this regard, I am quite confident that with proper
organization and determination, the private sector in
Tanzania in general and the CEO-RoundTable in
particular, can indeed shape a better future for
Tanzania!
I THEREFORE THANK YOU ALL FOR YOUR
KIND ATTENTION.
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