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Class 4 Governance, Globalisation and Accountability 21 Aug. 2007


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Title: Class 4 Governance, Globalisation and Accountability 21 Aug. 2007

Class 4 Governance, Globalisation and
Accountability (21 Aug. 2007)
Governance and Governments in the Pacific
  • Make a one line
  • Without speaking
  • Without using your left hand
  • Organise yourselves according to your date of
    birth from 1 January to 31 December

  • Aries (the Ram 21 Mar 19 Apr) Courageous,
    Enthusiastic and Straightforward but Impatient,
    Impulsive, and Irritable
  • Taurus (the Bull 20 Apr 20 May) Dedicated,
    Artistic, Romantic, and Stable but Stubborn,
    Resentful, Possessive, and Jealous
  • Gemini (the Twins 21 May 21 June) Social,
    Joyful, Clever, Open-minded but Over-talking,
    Devious, Tricky, and Inconsistent.
  • Cancer (the Crab 22 June 22 July)
    Resourceful, Loyal, Generous, and Warm but Moody,
    Instable, and Devious.

  • Leo (the Lion 23 July 22 Aug) Creative,
    Passionate, Independent and Noble but Bossy,
    Egotistical, Materialistic, and Arrogant.
  • Virgo (the Virgin 23 Aug 22 Sep) Analytical,
    Precise, Practical and Responsible but Critical,
    Reserved and Perfectionist
  • Libra (the Balance 23/24 Sep 22/23 Oct)
    Cooperative, Idealistic, Charming and Elegant but
    Manipulative, Indecisive, and Flirty.
  • Scorpio (the Scorpion 23/24 Oct 21/22 Nov)
    Determined, Passionate, Loyal, and Mysterious but
    Emotional, Secretive, Fanatical and Resentful

  • Sagittarius (the Archer Nov 22 December 21)
    Idealistic, Reliable, Optimistic, Independent,
    and Generous but Temperamental, Impatient, and
  • Capricorn (the Sea-Goat 22 Dec 19 Jan)
    Practical, Prudent, Trustworthy, and Hard-working
    but Authoritative, Aloof, and Businesslike.
  • Aquarius (the Water-bearer 20 Jan 18 Feb)
    Visionary, Humane, Intuitive, and Intelligent but
    Unpredictable, Eccentric, and Resentful.
  • Pisces (the Fish 19 Feb 20 Mar) Gentle,
    Compassionate, Spiritual, and Selfless but
    Naïve, Dreamy, and Impractical.

Globalization Good or Bad?
  • The movement towards the expansion of economic
    and social ties between countries through the
    spread of corporate institutions and the
    capitalist philosophy that leads to the shrinking
    of the world in economic terms (
  • What happened when technology allows people to
    pursue their own goals and they are given the
    liberty to do so (The Economist, 29 Sep. 2001).

Globalization Good or Bad?
  • Westernization and the acceptance of Western
    business standards and political systems around
    the world (Mahathir Mohammed, 1999)
  • Economic system dominated by supranational
    corporate trade and banking institutions that are
    not accountable to democratic processes or
    national governments (Concerned non-believer)

  • Globalisation increases economic prosperity as
    well as opportunity, especially among developing
    nations, enhances civil liberties and leads to a
    more efficient allocation of resources.
  • Free trade leads to a more efficient allocation
    of resources across the world, with all countries
    involved in the trade benefiting.
  • In general, this leads to lower prices, more
    employment, higher output and a higher standard
    of living for those in developing countries.

  • WB the number of people living on US1 a day or
    less declined from 1.47 billion to 0.97 billion
    from 1981 to 2004.
  • At the same time, the world population increased,
    and in percentage terms the number of such people
    in developing nations declined from 40.1 to
    18.1 of the population with the greatest
    improvements occurring in economies rapidly
    reducing barriers to trade and investment.

  • WB The improvements are particularly
    concentrated in China where such people declined
    from 0.63 billion to 0.13 billion whereas people
    living in absolute poverty increased in some
    areas particularly in Sub-Saharan Africa in the
    same period.
  • The number of people in absolute poverty did not
    change much in India but declined substantially
    as a percentage of population (51.8 to 34.3).

  • Damage to the global environment
  • Perceived human costs, such as increased poverty,
    inequality, injustice and the erosion of
    traditional culture.
  • GDP is a good measure of progress?
  • Unintended consequences of globalization social
    disintegration a breakdown of democracy more
    rapid and extensive deterioration of the
    environment the spread of new diseases and
    increasing poverty and alienation
  • Mediated according to corporate interests

  • income inequality, both between and within
    nations, is increasing as a result of these
    processes. Some economists are sceptical about
    the World Bank's figures on absolute poverty
    described above.
  • According to the 1992 UNDP Report, the
    distribution of global income to be very uneven,
    with the richest 20 of the world's population
    controlling 82.7 of the world's income.

Globalization Source
Bhagwati (2004)
  • The globalisation has helped to dramatically
    reduce absolute poverty by stimulating growth
    among outward oriented economies.
  • globalisation has
  • reduced world inequality,
  • helped reducing child labour,
  • reducing gender wage gaps, and
  • increasing job opportunities for women.
  • However, some related issues such as abuse of
    imported female domestic workers, increased
    prostitution for tourists, and increased
    trafficking in women must be dealt with.

Keohane - globalisation
  • States and other organisations exert effects
    over great distances peoples lives can be
    fundamentally changed or ended, as a result of
    decisions made only days or moments earlier,
    thousands of miles away. ? Interdependence is

Keohane - accountability
  • An accountability relationship is one in which
    an individual, group or other entity makes
    demands on an agent to report on his or her
    activities, and has the ability to impose costs
    on the agent. We can speak of an authorized or
    institutionalized accountability relationship
    when the requirement to report, and the right to
    sanction, are mutually understood and accepted.

Systems of accountability
  • Three syndromes of accountability in a
    constitutional democracy
  • Democratic (horizontal) power wielders are
    responsible to broad publics.
  • Hierarchic (vertical) subordinates are
    accountable to superiors
  • Pluralistic (constitutional offices) different
    branches of government are accountable to one

Exercise of accountability
  • Elections
  • Reporting
  • Horizontal supervision (checks and balances)
  • Fiscal and legal controls
  • Peer review
  • Markets
  • Concern for reputation

O'Donnell Elections
  • Reasonably free and fair elections provide a
    means of horizontal accountability in these
    countries, along with freedoms of speech, press,
    and association, which permit citizens to voice
    social demands to public officials (elected or
    not) and to denounce these same officials for
    wrongful acts that they may commit.

O'Donnell Elections
  • Elections, however, occur only periodically, and
    their effectiveness at securing vertical
    accountability is unclear, especially given the
    non-fully developed party systems, high voter and
    party volatility, poorly defined issues, and
    sudden policy reversals that prevail in most new

O'Donnell Elections
  • As for social demands and media coverage, in the
    absence of duly authorised state agencies of
    investigation and oversight capable of realising
    responsibility and sanctions, they are extremely
  • However, sometimes they risk merely creating a
    climate of public disaffection with the
    government or even the regime itself.

Democracy as an accountability device (ODonnell)
  • We live in a democratic era, …. In democratic
    theory, individuals are regarded as inherently
    equal in fundamental rights, and political power
    is granted to officials by the people, who can
    withdraw that authority in accordance with
    constitutional arrangements. The legitimacy of
    an official action in a democracy depends in part
    on whether the official is accountable.

Internal and external accountability
  • Internal accountability create capabilities to
    hold entities accountable because the principal
    (the actor holding an agent accountable) is
    providing legitimacy or financial resources to
    the agent.
  • The principal and agent are institutionally
    linked to one another (e.g. Solomon Island
    government Solomon Island people Provident
    Fund management Provident Fund contributors)

Internal and external accountability
  • External accountability accountability to people
    outside the acting entity, whose lives are
    affected by it (e.g. African farmers World
    Bank Indian people Microsoft Corp. Afghan
    people US government).

Internal Accountability Auditing
  • See the website of the audit office (auditor
    general) of your country (if the web-site exists)
    to check the examples of the breach of
    accountability by officials and politicians.

Accountability Gaps
  • Multi-national corporations
  • Trans-governmental and private sector networks
  • Religious organizations
  • Mass religious movements such as fundamentalists
  • Covert terrorist networks
  • Powerful states
  • NGOs

  • UNDP the exercise of economic, political and
    administrative authority to manage a countrys
    affairs at all levels. It comprises the
    mechanisms, processes and institutions through
    which citizens and groups articulate their
    interests, exercise their legal rights, meet
    their obligations and mediate their differences.

  • Another definition Governance can be defined as
    the making and implementation of rules, and
    exercise of power, within a given domain of
  • Also, as we have learned, governance is a complex
    field of relations between actors including state
    institutions, people as individuals or groups,
    and the private sector.

Global Governance
  • However, how governance mechanisms work at global
    level? There is no global government or global
  • Globalisation makes some degree of global-level
    regulation essential, but both institutions and
    loyalties are much deeper at local and national
    levels. Hence it is not clear what principles and
    practices that are justified domestically would
    be appropriate at a world scale (Keohane, 2003).

Global Governance
  • Interdependence without any organised government
    ? Actors to seek to solve their own problems by
    imposing costs on others. ?retaliation ?
    conflicts ? Construction of international
    institutions by states to enable them to
    cooperate when they have common or complementary
    interests ? They have established rudimentary
    institutions of governance, bilaterally,
    regionally, or globally.
  • These attempts at governance, including global
    governance, are a natural result of increasing

International Organisations are accountable?
  • States remain the most powerful actors in world
    politics, but it is no longer even a reasonable
    simplification to think of world politics simply
    as politics among states. ? Other actors such as
    multinational corporations, international
    organisations (IMF, World Bank, WTO etc.), and
    NGOs are playing important roles in global
    governance. Also, new networks, both good and bad
    ones (networks of drug smugglers and terrorists)
    connect people across borders.

(No Transcript)
WTO Website
  • It would be wrong to suggest that every country
    has the same bargaining power. Nevertheless, the
    consensus rule means every country has a voice,
    and every country has to be convinced before it
    joins a consensus. Quite often reluctant
    countries are persuaded by being offered
    something in return.
  • Consensus also means every country accepts the
    decisions. There are no dissenters.

WTO Website
  • What is more, the WTOs trade rules, resulting
    from the Uruguay Round trade talks, were
    negotiated by member governments and ratified in
    members parliaments.

Global Governance
  • can be exercised by states, religious
    organisations, and business corporations, as well
    as by intergovernmental and non-governmental
    organisations. Since there is no global
    government, global governance involves strategic
    interactions among entities that are not arranged
    in formal hierarchies (Keohane, 2003).

Global Governance
  • Since there is no global constitution, the
    entities that wield power and make rules are
    often not authorised to do so by general
    agreement. Therefore their actions are often not
    regarded as legitimate by those who are affected
    by them (Ibid).

Three crucial regulatory and political gaps
David Held
  • Jurisdictional The discrepancy between a
    regionalized and globalized world and national,
    separate units of policy-making, giving rise to
    the problem of externalities such as the
    degradation of the global commons and who is
    responsible for them.

Three crucial regulatory and political gaps
David Held
  • Participation The failure of existing
    international system to give adequate voice to
    many leading state and non-state global actors.
  • Incentive The challenges posed by the fact that,
    in the absence of any supranational entity to
    regulate the supply and use of global public
    goods, many states will seek to free ride and/or
    fail to find durable collective solutions to
    pressing transnational problems.

Global Civil Society? John Keane
  • …a dynamic non-governmental system of
    interconnected socio-economic institutions that
    straddle the whole earth, and that have complex
    effects that are felt in its four corners.
    Global civil society is neither a static object
    nor a fait accompli. It is an unfinished project
    that consists of sometimes thick, sometimes
    thinly stretched networks, pyramids and
    hub-and-spoke clusters of socio-economic
    institutions and actors who organise themselves
    across borders, with the deliberate aim of
    drawing the world together in new ways.

Global Civil Society? John Keane
  • These non-governmental institutions and actors
    tend to pluralise power and to problematise
    violence consequently, their peaceful or civil
    effects are felt everywhere, here and there, far
    and wide, to and from local areas, through wider
    regions, to the planetary level itself.

Cosmopolitan Democracy David Held
  • what is new about the modern global system is the
    spread of globalisation in and through new
    dimensions of activity technological,
    organisational, administrative and legal, among
    others and the chronic intensification of
    patterns of interconnectedness mediated by such
    phenomena as the modern communications industry
    and new information technology.

Humane governance Richard Falk
  • During transition to geo-governance the loss of
    control by the state over the political process
    is a notable feature. As a result, prospects for
    humane governance depend on strengthening the
    impact of democratic procedures and human rights
    on arenas of decision that are not regulated by
    the state and yet affect the quality of human

Cosmopolitan Institution Building David Held
  • … while there may be cosmopolitan elements to
    existing international law and regulation, these
    have, of course, by no means generated a new deep
    - rooted structure of cosmopolitan accountability
    and regulation.
  • The principle of egalitarian individualism may be
    widely recognised, but it scarcely structures
    much social and economic policy, north, south,
    east or west.

Cosmopolitan Institution Building David Held
  • The principle of universal recognition informs
    the notion of human rights and other legal
    initiatives such as the common heritage of
    humankind (embedded in the Law of the Sea), but
    it is not at the heart of the politics of
    sovereign states or corporate colossi …

External accountability of states
  • The legitimacy of an official action in a
    democracy depends on whether the official is
    accountable. ? A key question of global
    governance involves the types and practices the
    types and practices of accountability that are
    appropriate at this scale.
  • If we believe in accountability, we need
    especially to pay attention to sates. How can
    powerful states be held more accountable in world

To realise internal and external good governance …
  • now requires partnerships with
  • Citizens
  • Civil society groups
  • Media
  • NGOs
  • Intellectuals
  • Public advocates and activists

  • You put your (Right foot) in, You put your (Right
    foot) out You put your (Right foot) in, And you
    shake it all about. You do the Hokey-Pokey, And
    you turn yourself around. That's what it's all
  • Change Right foot to Left foot Right arm Left
    arum Backside Head and Whole self

Tragedy in Newfoundland
  • Over-catching by the large distant-water fishing
    vessels ? Foreign fishing fleets were banished.
    However, the government kept the quota to
    unsustainable levels for domestic fleets. In
    1992, the devastating collapse of the cod stocks
    forced the government to close the fishery. Over
    40,000 people lost there jobs. The communities
    are still struggling and marine ecosystem is
    still in a state of collapse.

  • Regional Fishery Management Organizations (RFMOs)
  • Distant Water Fishing Nations (DWFN)
  • Membership
  • Geographical scope
  • Material scope
  • Main objectives
  • Structure Commission, Scientific Committee,
    Technical and Compliance Committee, and

  • Main functions
  • adopting conservation and management measures
    and recommendations
  • allocating the total allowable catch or the
    total level of fishing effort amongst members
  • adopting generally recommended international
    minimum standards
  • establishing mechanisms for monitoring,
    control, surveillance and enforcement

  • promoting cooperation and coordination between
    members ?conservation and management measures in
    areas under national jurisdiction and on the high
    seas are compatible
  • adopting conservation and management measures
    and recommendations for non-target species and
  • adopting standards for collection, verification
    and for the timely exchange and reporting of data
    and compiling and disseminating data.

  • In adopting measures for the high seas, the
    Commission is to ensure compatibility with
    measures adopted for areas under national
    jurisdiction and measures are also to be
    consistent with the precautionary approach and
    certain other general principles of responsible
    fisheries management.

Tuna-led Sustainable Development in the Pacific?
Parris Grafton
  • PICs have very small populations but their
    exclusive economic zones (EEZs) extend 200
    nautical miles from land and represent a huge
    area of the Pacific Ocean. Therefore, marine
    resources are critically important to the well
    being of some PICs, especially those with a large
    EEZ, a small population and a tiny land mass.

Tuna-led Sustainable Development in the Pacific?
Parris Grafton
  • The region now supplies about 40 of tuna caught
    in the world. PICs receive only a tiny faction of
    the benefits from the fisheries found in their
    territories because about 90 of the fish caught
    in their EEZs is harvested by DWFNs, and these
    nations only pay approximately 3-4 of the landed
    value in access fees (US 2 billion vs. US60

Tuna-led Sustainable Development in the Pacific?
Parris Grafton
  • The failure to fully realize the potential
    benefits from their fishery resources is of major
    concern for PICs. It was hoped that fisheries
    would address two major challenges
  • reduce the risks of overexploitation of a
    common-pool resource and

Tuna-led Sustainable Development in the Pacific?
Parris Grafton
  • provide the PICs with a reliable source of income
    with which to finance economic development.
    Unfortunately, both of them have not been
    realized yet. It has been suggested that some
    stocks such as yellow fin tuna and big eye tuna
    may be overexploited. The access fees PICs are
    receiving are low by comparison to those paid in
    other parts of the world.

Lack of bargaining power of PICs relative to DWFNs
  • Some PICs were reluctant to collaborate among
    them to bargain as a group. This made it easier
    DWFNs such as Japan to manipulate negotiations
    through a divide and conquer strategy by
    refusing to negotiate with PICs collectively that
    wished to do so, and ensuring that at least one
    access arrangement to a EEZ was always in
    operation, they were able to keep PICs in
    competitive positions with respect to each other.

Bundling of aid and fisheries access
  • It is common practice in the Pacific for donors
    to bundle in-kind or financial development
    assistance in the expectation that they will be
    favorably considered in negotiations over access
    to resources and fees.

Fostering a domestic fishing industry
  • A major strategy pursued by PICs to achieve the
    desired economic benefits from their tuna
    fisheries has been developing and integrating
    domestically located harvesting and processing
    sectors to serve export markets.
  • Making a SOE for a domestic tuna industry trying
    to harvest tuna by themselves (almost all them
    are failures)

Fostering a domestic fishing industry
  • Requiring foreign vessels to utilize domestic
    infrastructure and nationals to crew boats, and
    maintaining and completing compliance procedures
    (these strategies have largely failed)
  • Fisheries management is costly (go-it-alone
    strategy in terms of harvesting and managing tuna
    will not generate net benefits)

Too many ships
  • Also total fishing efforts of participants are
    likely at a level that exceeds the level of
    maximizing the economic surplus (too many ships
    are chasing same tuna stocks ? cost of fishing
    for each vessel goes up because each vessel needs
    more time and efforts to catch same amount of
    tuna ? the total profit would increase if the
    number of ships can be reduced given that the
    capacity of each ship constant)

WCPFC is effective?
  • Although WCPFC agreement is to establish total
    allowable catches for tuna at the regional level
    is a significant break from previous practices of
    controlling catches through controlling fishing
    effort its implementation can be undermined by
    the methodology.

WCPFC is effective?
  • The total allowable catches (TACs) are set by
    consensus among signatories and the commission is
    in charge of coordinating the process. WCPFC is
    poorly equipped to deal with any other economic
    issues and there are significant institutional
    gaps in the management framework.

WCPFC is effective?
  • It is a treaty about the amount of fish to be
    caught, rather than about helping PICs overcome
    their development issues through better use of
    their tuna resources.

WCPFC is effective?
  • Nevertheless, WCPFCs entry into force as a body
    of international law represents an impressive
    development it is a genuine multilateral regime
    that includes all PICs and currently most of
    significant DWFNs.

Tuna and governance in PICs
  • AusAID has argued that poor governance and poor
    institutional quality is the major barrier to the
    future development prospect for PICs. For
    instance it has been suggested that the PNG
    National Fisheries Authority has insufficient
    internal and external controls applied, obscure
    licensing processes which are subject to
    manipulation, poor record keeping, mismanagement
    of trust accounts, and extensive use of influence
    rather than merit to determine management

Resource Curse
  • Even if PICs are successful to extract more rent
    from tuna fisheries under WCPFC, tuna-led
    development represents more governance challenges
    to PICs called Resource Curse (experience of
    PNG and Nauru) which usually includes the
    phenomena such as declines in non-resource export
    sector, …

Resource Curse
  • crowding out effects, poor decision making at the
    government level, and a decline in the quality of
  • Unfortunately, corruption is the key in spreading
    the imports of the curse and it is also an
    unfortunate feature of some institutions in PICs.

Resource Curse
  • To maximise the development potential of regions
    fishery resources PICs and donors should
    strengthen multinational institutions that reduce
    harvests and increase total economic benefits
    from tuna fishery and increase capacity in the
    public sector by improving government
    effectiveness including development of innovative
    ways to reduce corruption and the possible misuse
    of public revenues from fishing access fees.

Discussion Topics
  • What are the implications and consequences of the
    lack of external accountability, particularly in
    the Pacific?
  • Why is it difficult to sustain the renewable
    resources such as tuna which is crucial for the
    development of a number of Pacific Island
    countries? What can we do?