Box 4.5 Globalization, Governance, and Poverty

BOX 4.5 GLOBALIZATION, GOVERNANCE, AND POVERTY The current wave of economic globalization has lifted many people out of poverty and enhanced human welfare. But the benefits of globalization have not yet reached far enough: over three billion people still live impoverished lives, and the fields, fisheries, forests, and waterways they depend on are increasingly at risk. As the Millennium Ecosystem Assessment points out, the transformation of ecosystems over the past five decades dwarfs the cumulative impact over the preceding centuries. This degradation is undercutting rural livelihoods (MA 2005:2). Half of all jobs worldwide depend on agriculture, forestry, and fishing. Yet agricultural subsidies and other import restrictions in developed countries make it difficult for developing country farmers to compete on the world market (WTO 2003:10, 22). < p>Improving this situation will require better and smarter globalization. Ultimately, a sophisticated market economy is the only mechanism capable of generating lasting prosperity. Market-based approaches, where informed by socially and environmentally responsible public policy, have also been effective in forging solutions to some environmental problems. Emissions trading has been successful in reducing sulfur dioxide and nitrogen oxides, and tradable fishing quotas have reduced over-fishing (Aulisi et al. 2005:11; Kura et al. 2004:92; Ellerman et al. 2000:315; NRC 1999:192). Innovative approaches are being used to assign value, and hence to protect,