Having begun in the Orient eighteen months ago, the sudden crisis which has shaken the entire world since the (northern) summer reveals the vast network of interdependencies which link the economies of all countries, even to those who have ignored this fact so far.

A new global landscape is being formed, disturbing in more ways than one, produced by forces which are little known and difficult to decipher, leading to an unpredictable future. This enormous change, which has been in progress for at least a quarter of a century, is moreover only in its early stages. True change is undoubtedly still to come. No one really knows what this new world will be like, what kind of shape it will take, or how to master it.

This world movement has several driving forces, notably amazing progress in science and technology. There are shifts in values, shifts in cultures, and what we call globalisation, meaning something which has swept up all humanity on the planet, now obliges us to think globally.

The economic side of globalisation is made very clear by its impact on daily life. Moreover it is not confined to that. So that we are in agreement about what we are speaking of when we use the word 'globalisation', I would like to specify that it refers to two different realities. On one hand it refers to a system of exploiting measures of profit linked to a liberal vision of society and economics - that which one calls the market. On the other hand, it refers to the fact that everyone's fate is now more and more closely linked to everyone else's.

It is this double meaning of globalisation which I intend to outline in five chapters in the first part of this address, before proceeding in the second part to offer an overview of ways of achieving citizenship in a new world, and in the third I will give a brief evaluation with reference to the teaching of the Catholic Magisterium on this subject.

PART ONE: THE LANDSCAPES OF GLOBALISATION

1. An Economy Driven by Financial Markets

Three events in the last quarter century have shaped the current global monetary and financial system: the abandonment of fixed exchange rates between major currencies and the gold standard in 1971; the renunciation of currency and credit controls by nation states in the 80's; and enormous progress in communications which now allow the transmission of messages at the speed of light.

We are now living with a system of floating exchange rates, deregulated credit and frantic market activity. This system rules a huge money market, with instant transactions and no regard for national borders. The sums of money which change hands every day in one market or another are enormous; one speaks of 1,500 or even 2,000 billion dollars each day.

I am unable to describe this complex market and the way it functions here, so I will limit myself to six brief points:

1. The money which changes hands ceaselessly through electronic means doesn't really exist, it is largely virtual money. The sum needed for production and purchasing is in fact only one or two percent of total daily transactions. The rest is used in pursuit of profits which are more or less speculative.

Two current events illustrate this 'virtuality'. Since the beginning of the year, large public companies have seen their share value rise by 30%. This value has resulted from demand for shares by speculators, and has no great relationship with the companies' assets. This share value has just fallen by 30%. So what is this money which can be created and then vanish?

The other issue is that of financial products called derivatives. These are sophisticated wagers where only a certain percentage of of the sums involved are actually committed, on the expectation that the balance will be paid at the end of the term. What is the nature of this money which is invested only in promissory form?

2. The active agents - or 'operators' of financial markets are, for the most part, the managers of pension funds, building societies, fund managers of large firms, also banks, insurance companies, and governments who wish to finance their budget deficits through the markets, and also, with or without our knowledge, you and I. These principal operators, who control large sums, are in fact the managers of our savings, or in the Anglo-Saxon countries, employee's retirement funds.

3. Rules don't exist and no one has the power to control this complex machine. There is no longer a "conspiracy of big capital". The market is a jungle. Everyone approaches the market with his own intuition, his taste for risk, and his sources of information. The "operators" behave rather like sheep. Everyone performs the same transactions at the same time, which results in mass market movements. If the managers of derivative products take risks for quick profit, the managers of saving funds require both high returns and security. With the funds at their disposal, they can move their investments in a few minutes from emerging but risky countries such as Indonesia or Brazil to Europe or the USA. All this can happen in an instant. The markets are irrational, giving way quickly to panic.

4. Corruption undermines the system. In theory, financial regulation should have had positive effects on global economic growth. This has been true for some years for certain emerging countries, notably in Asia. This could have continued if everyone had behaved honestly. But now it seems that one has discovered that this was not the case. The banks made loans unwisely and then falsified their balance sheets, and in certain countries the involvement of criminal elements in money-laundering and illicit trade led to instances of corruption. This belated discovery led to the rapid retreat of international fund managers back to the rich countries.

5. Global production is affected by all this, as is the income of workers. Production will never again be as it was in the past. The material economy has given way to an "immaterial economy", the production of goods has been replaced by production of intangibles. Multinationals always exist, but increasingly they are composed of small central commands controlling subsidiaries or specialised sub-contractors in several countries from a distance, in order to make products designed for the global marketplace. Production is globalised, and can be shifted elsewhere quickly where opportunities arise.

For some years, fund managers have been investing capital in companies. They expect increased returns, with a rate of risk comparable to the share markets. To achieve this, companies find it necessary to decrease the percentage of wage costs in the total cost of production, which puts pressure on workers' incomes. One strategy has been mechanisation, another the reduction of workforces leading to unemployment - all this has been detrimental to workers. When despite such measures returns do not meet the expectations of managers, they withdraw large amounts of investment therefore affecting share values, as one has seen these past weeks. This is why one speaks of a finance-driven economy.

6. This multiplicity of mutual interdependencies characterises this turn-of-the-century economy. Interdependencies between countries - a financial crisis on the other side of the world has repercussions everywhere, with the notable exception of most African countries, who for the moment are almost irrelevant in the economy and financial markets of the world. Interdependencies between businesses and the markets. Interdependencies also between interest rates, exchange rates, share values, commerce, production, employment, incomes, the consumption or saving of workers.

One cannot describe this machinery according to mechanical laws. One must think now in biological terms - the living thing is a system made up of a multitude of mutual interdependencies in an unstable equilibrium. The finance-driven economy is constructed like such a system.

The issue which all of this gives rise to is mastering this system by introducing regulations. Is this possible without increased transparency? And who will supervise this, the system itself, so that it might survive and avoid a catastrophic disintegration, or an international public force? Does such a thing even exist?

A CULTURE WITH PRETENSIONS TO UNIVERSALITY

The finance-driven economy clearly corresponds to the first definition of globalisation. On the other hand, culture combines both meanings. It can be seen as the common wealth of humankind, as well as merchandise. This is explained in the following points.

2.1. The existence of a global nervous system

An enormous development in communication tools has occurred in the last few years. Digitalisation has made it possible to link communication networks and transmit information with speed, ease and at low cost. Computers and telephones which are becoming increasingly mobile, can be linked together to create interactive and "friendly" global networks, such as the Internet.

Potentially, the means exist which will allow each inhabitant of the earth to communicate with all others and exchange messages with them. The only obstacles to this are linguistic barriers and the cost which is still too high for the poorest people. Nonetheless, this is a phenomenon of enormous significance: the fact that everyone can be linked to everyone else means that the "global village" will become more and more of a reality, even if it is a village where there are still many issues in dispute.

2.2. The cultural domination of Hollywood

Global goods and services are products of the Western thinking of their originators, who therefore tend to universalise their values, marginalising those who don't adopt these. This is true of fashionable objects and more so of information systems such as Microsoft Windows.

At the same time, there is another way in which a global culture is being produced. The production of cultural material - films, songs, and theme parks designed for a global public, has become a highly profitable business. The gigantic Hollywood companies are therefore involved, and overwhelm the production of other countries. Their products often reflect the values and lifestyles of Americans, but more and more often, these products are works of fiction, with no reference to the culture of any people. Their domination is undeniable, and it creates dependence without reciprocity.

This domination by an artificial culture, with pretensions to universality, provokes reactions of both seduction and repulsion. In different parts of the world, the reaction is to embrace this internationality or instead, nationalistic feelings are reinforced. But without going to either extreme, one should be alarmed at the retreat of local cultures and the uniformity being imposed by Hollywood culture.

As a positive contrast, an interactive dialogue between cultures, encouraged by migration and above all by the spread of new means of communication, is constantly creating new cultural forms through mingling and cross-fertilisation. These can be seen in everyday life, in the way people live together, in fashion and the arts, especially in music. Each culture is being nourished and acquires increasing vitality.

2.3. Sharing knowledge

An accumulation of knowledge on an unprecedented scale is being made possible through global communication - this is a very positive element. Every discovery is now accomplished by multidisciplinary and international teams, in networks working in the same field in different countries. These teams exchange information at numerous conferences, but also through communication networks. This wealth of knowledge leads to rapid breakthroughs, which are then disseminated more and more widely and quickly.

3. Demographics: Living side by side

The UN Conference in Cairo in 1994 on "Population and Development" reinforced the awareness that humanity has a common destiny, but is truly diverse. Among the consequences of current population growth - although this has slowed in the last 30 years - let us consider just two. The first is the probable increase in numbers, at greater speed, of mass migrations, even if these were to be better controlled than they are at present. There are currently 120 million people who live in countries other than their own, that is, 2% of humanity. If this percentage remains the same, the numbers will be much higher in a world 20 years from now with a population of between six and eight billion people. Migration entails social conflict in the countries of immigration. On the other hand, it facilitates contact with cultures and civilisations which breathes life into tired national cultures. The second consequence is that, as we become more numerous on an earth which is not getting any bigger, human beings are being forced to live closer to each other. This proximity, when it is badly managed, leads to strains which threaten civil peace, while when it is well managed, it gradually leads to the reality of the "universal human family" which is at the heart of Christian faith.

4. A finite world

The last quarter century has seen an awareness grow of the limits of the environment. The UN Conference in Rio in 1992 on "Environment and Development" was a turning point. We have only one earth for one humankind and this earth is small and fragile, unable to meet the desire of close to 8 billion people of attaining the average standard of living of the rich countries. The biosphere is also the common and indivisible inheritance of an enlarging human population. We need to understand each other in order to live together "for all time and in viable ways".

There are those who think of "enlarging the space in our tent", whether through exploitation of the oceans or the colonisation of space. This isn't science fiction. Right now, the ocean depths are being explored; robots are being dispatched to study the planets and their moons, a manned space station is being prepared so that life "in a vacuum" can be experienced. All the same, nothing of consequence will occur in these domains for 50 - 100 years. Yet the climax of the ecological crisis which threatens us will come in the next 50 years.

5. The challenge of global politics

How capable are political institutions of responding to the challenges of uncontrolled globalisation? Here are three points to consider:

5.1 Progress in civil society and human rights

One of the obvious reactions is the globalisation of "civil society". Whether these are issues of the West, of the Third World, and now in Eastern Europe, non-government organisations (NGOs) have dialogues at regional and global levels. The signal that this phenomenon is of growing importance is that these forums are now held in conjunction with the major international conferences of the UN. This spider's web of peoples' organisations is the prototype of a global civil society and of global public opinion. This was formally acknowledged in 1997 by the award of the Nobel Peace Prize to a network of associations fighting against anti-personnel land mines.

This civil society is also based on human rights. We are soon to celebrate the 50th anniversary of the universal declaration of these rights. More and more, it is also based on environmental fundamentals. The universal declaration and the covenants which enforce it take on a particular importance at a time when the finance-driven economy marginalises human life and threatens the biosphere, and also when speculators and criminal elements are now global forces because of the impotence of traditional legal powers within national jurisdictions. The European and International Courts and the creation of an international justice tribunal are steps in the right direction.

5.2 Globalisation of law and order

One would have thought that the end of the Cold War would have similarly ended conflicts imposed by power blocs on the Third World. The opposite has occured. New zones of conflict have appeared, even in Europe, which threaten the interests of the great powers and call for them to react to maintain order.

The military strategies of the economically powerful nations are now focused on a capacity to maintain order from a great distance. But the material means to such ends are difficult to finance, only the United States truly has the capacity to intervene globally, in any place on earth, and such means are of course devoted to their own interests.

5.3 Political factors which stand in the way of globalisation

Nation States have been undermined at the highest level by changes in information technology and finance which no one can control, and at the grassroots by the desire of their citizens for smaller, more localised governments. Nation States have become too small to deal with great problems, and too large to deal with small ones.

How can one imagine that they will participate in a supranational authority capable of imposing rules on the financial markets? This is made even more difficult by the fact that no state is predisposed to cede any part of its sovereignty to any such authority, and they also have the excuse that there is popular resistance to changes of any magnitude. With each crisis, there again arises the question of controlling globalisation, which is opposed to the desire of the United States to leave the markets to regulate themselves without state intervention. For the same reasons, the UN also does not have the international sovereignty which one would have attributed to it.

Analysts of the world situation see a prototype of an international political situation in the development of zones of free trade, some of which already exist. These could be, in time, political unions such as the European Union, initiating a "federal" structure of global sovereignty. Seeing that it has taken 40 years to achieve this in Europe, one fears that this is too slow a method of regulating the problems of the next few years.

PART TWO: BEING A CITIZEN OF THE WORLD

To be a citizen of the world is a wonderful aspiration, but how does one truly achieve this when the world is so vast and complex? The natural reaction is to be delighted to have escaped the worst consequences of change, or else to take on the role of victim. But, whether one likes it or not, we are all participants in globalisation. This means two things: we are all implicated even in what we deplore; we can at the same time exercise power to change the way things are.

The long litany of our own complicity begins with investing our savings where we expect increasing returns, by the abuse of credit which makes us dependent on the financial markets, by excessive demands on public services which make deficits or loans neccessary, by opposing reassignment of sovereign powers, by rejecting foreigners so that their poor cannot leave their own countries, etc.

In contrast, the catalogue of the powers we have to act starts with the investment of our own savings in socially responsible ways, and institutions already exist for this; through participation in networks of associations which are open to the concept of universality; through participation in political life at least by exercising our vote; through respect for the environment; by welcoming foreigners and accepting multiculturalism; by fighting for respect for human rights; and in safeguarding the physical world we all inhabit in common.

I cannot go into more detail because of time constraints, but I have tried to at least outline this essential message, because of the responsibility we all share.

PART THREE: CATHOLIC TEACHING AND GLOBALISATION

It is difficult to judge globalisation without historical hindsight. It seems certain however that, without restraint, the enrichment of a few at the price of the impoverishment of many will lead to an unviable situation for humanity: all out civil war. This is not to say that one has to reject the global system of credits: that would be catastrophic. But this system must be constrained so that everyone can have a better lot in life. On the other hand, the growth in mutual communication between individuals and groups brings humankind closer together; this will surely allow us, one day, to bring this civilisation based on money under control.

This difficulty in assessing the situation is undoubtedly the reason for the silence of the Catholic Church on globalisation. However, the Vatican II Council seemed to have had some foresight, no doubt because for the first time all peoples had representation there. It would have been most interesting to enlarge the first part of gaudium et spes in response to the question: what significance does this period of globalisation have in the history of salvation? In any case, references in this text to the Gospel and the principles for judgement and action which it suggested, retain an importance which is still very useful despite the changes in world society which have occurred since it was released. These can be summed up in four points:

Humankind is the centre and the ultimate beneficiary of all economic and social life. This gives mankind the right to a decent life and to work, and also the right to participate in controlling development.

The work of mankind is more important than any other elements of economic life. This work must ensure the possibility of dignified family life. God intended the earth and everything in it for the use of all humanity, and not just for a few.

The increase in cultural exchanges must not overturn the life of communities, make ancestral wisdom worthless, or endanger the individual spirit of any peoples.

Man by his very nature is a social being. Without relationships with others, he can neither live nor flourish. The political community which unites mankind exists for their common good. The international community needs to have a more effective approach to achieving this common good in order to respond to today's challenges.

But we have seen that the globalisation of the financial economy places profit before people, undermines work and makes a decent life anattainable for many; that culture swamped with merchandise corrodes the true wisdom of communities; the citizens of these communities are dispossessed of their right to be masters of their own development; and the international community is not well-enough organised to deal with all of this. There are serious contradictions between a doctrine based on the Word of God and the reality of our time. Within globalisation, there are "structures of sin" which hinder humankind's universal aspiration to greater happiness and dignity. It is neccessary to identify these structures, change and redirect them. On the other hand there are aspects of globalisation which are in keeping with legitimate human aspirations.It is necessary to develop these. New forces are arising in order to change the perverse aspects of globalisation. Popular imagination is being used in order to experiment with new ways of life. There are organised movements which protest against the economic and cultural impoverishment which carry threats to human dignity.

I borrow my conclusion from the message of John Paul II at the recent World Day for Peace. He said: "The great geopolitical changes which have occurred since 1989 have been accompanied by real revolutions in the social and economic spheres. The globalisation of the economy and of finance is now a reality and we are understanding more and more clearly the results of the rapid progress of information technology. We are on the threshold of a new era which brings great hopes and disturbing questions. What will be the consequences of all the changes which are in the process of happening? Can everyone benefit from a global market? At the end of the day, will it be possible for us to enjoy peace? Will relationships between nations become more equal, or will economic competition and rivalry between peoples lead humankind towards even greater instability? "

Let us promote "globalisation based on solidarity, globalisation without marginalisation. There is an obvious duty to ensure justice which allows for the important moral implications in the organisation of the economic, social, cultural and political lives of nations."