It was 105 years ago that the first trade commissioner was sent from Canada to Australia -- a few years before Australian nationhood. A Mr. John Larke, a Canadian businessman, was appointed by the government to help Canadian industry diversify its trade beyond the increasingly protectionist American market.

He ended up staying here for ten years -- without once going back to Canada! We are not really sure whether that is a reflection of how he felt about Australia, or how he felt about Canada!

I, on the other hand, will be staying for just about ten days! I will spend a good part of that time in Darwin, next week, where Australia will play host to the meeting of APEC Trade Ministers. I hope we will be able to make some progress on several different trade facilitation measures and many other questions of concern to Pacific rim countries.

It is a very important meeting, but I suspect that people will be more interested in watching the Olympic Games that you will be hosting later this summer! I wish I could stay for a few more months, like Mr. Larke, and take in the Olympics!

Then maybe I could stay on for a few more months, and be here for the celebration of Australia's 100th birthday on January 1, 2001! You have a busy few months ahead of you!

I am sure one of the reasons Mr. Larke stayed so long is that he felt right at home here since our two countries are very alike in many respects -- if we exclude the temperature!

Australia and Canada - Lots in Common

Our two countries have a long history of working together. And even if we are at opposite ends of the world's largest ocean -- we have so many things in common.

We are two of the oldest members of the Commonwealth. Our federal structures are very similar, with federal, territorial, state and provincial governments.

We share common political, legal and business practices. We understand and trust one another. We can trade in intellectual and cultural products as easily as we do in wine or wool or airplanes.

Both our populations are spread out over very large spaces, presenting us with unique challenges, particularly in communications and transportation. Actually, it is this geographic reality that has led both of our countries to become world leaders in communications technology -- and I am delighted that communications companies in Canada and Australia are collaborating to provide better products and services for their clients.

In fact, as you probably know, Telstra is now beginning the deployment of a broadband services platform from Nortel Networks of Canada. This will add a tremendous new capacity to Telstra's already formidable position as Australia's major Internet and telephone company.

What we started in 1895, we are still doing today -- searching for wider markets for our products and services and looking to diversify beyond the U.S. market.

Don't get me wrong. We like living next door to the biggest economy in the world. In fact, Canada and the United States are each other's largest trading partner. Approximately $1 billion per day of goods and services passes across our shared border.

But we know there are also opportunities for us throughout the world - here in Australia, in Asia, in Europe and everywhere else. We want to take advantage of those opportunities because we are a trading nation.

In fact, on a per capita basis, we are one of the largest trading nations in the world. About 43 percent of our GDP [gross domestic product] is directly linked to trade.

And, like Australia, we are a middle power. It is in our interest to have a strong, rules-based international trading system. Without that, we would be at the mercy of the largest nations whenever they want to flex their muscles. That is why both of our countries are strong supporters of the WTO [World Trade Organization] process.

"Battle in Seattle"

Admittedly, it is a process that does not always run as smoothly as we might want -- as the so-called "Battle in Seattle" showed very well!

The popular view seems to be that the 135 governments represented at those talks failed to reach agreement on the launch of new trade negotiations primarily because of the demonstrators out on the streets.

People had come from many different parts of the world, including Canada, to protest against globalization -- and they directed their protests against what they saw as the governments who were responsible.

I don't see it that way at all! I firmly believe that even without the demonstrators, those talks would have failed -- and for the most traditional reasons -- clashes between North and South, and differences between governments on what they perceived to be best for their own citizens in an international agreement on trade.

It should be remembered that we also failed in Geneva in 1982 to launch new trade talks. We ended up launching them in 1986. We failed in Brussels in 1990 to conclude the same Uruguay Round talks, and we ended up concluding them a couple of years later.

So, there is nothing new in international trade talks being delayed. As such, I remain confident that those talks will eventually get underway, and we are very busy working to help make sure that happens.

Internationalization and Globalization are Different Phenomena

Now, to go back to the people protesting in Seattle. I think their protests against globalization were misdirected. In fact, I think that there is a great deal of confusion between globalization and internationalization. They are two very different phenomena.

To me, the new era of globalization -- which has only been around for ten or fifteen years -- has two births -- one economic and one political.

Economically, its birth was the day in the mid-80s that we connected electronically the three major stock exchanges of the world -- Tokyo, London and New York.

Politically, its birth was the day that the Berlin Wall fell in November 1989.

So this is a new phenomenon, globalization. It is a recent one. And I believe that it is radically different from and even contradictory to the more traditional phenomenon of internationalization that dates back several millenniums.

What happens at the WTO has very little to do with globalization. To me, what the WTO discussions are all about is internationalization -- states dealing with other states and governments dealing with other governments. They are about making agreements to co-operate on everything from trade to reducing tensions and conflict, to things like the ban on landmines which the Canadian government, and my colleague, the Minister of Foreign Affairs, Lloyd Axworthy, championed around the world.

Internationalization Affirmed the Role of States

Following World War II, Western governments decided that by making countries more interdependent, we had more chance of making sure that peace would last. Economic growth and economic development were also part of the plan of internationalization.

Internationalization, then, is governments deciding to get together and negotiate between themselves some facilitation and accommodation between each other. The very word says it. It is "inter nation," between nations, between countries.

It is a phenomenon that recognizes and affirms that there are borders. It recognizes the legitimate authority of the government to carry out those negotiations, and the authority of each government, within its own borders, to implement international agreements.

It is a vertical form of management. It looks like any organization chart of any company. At the top are the presidents or prime ministers, then there are the elected representatives, the Supreme Courts, the state and provincial governments, and so on right down to the individual citizen.

Globalization is Qualitatively Different

Globalization is, qualitatively, of a totally different order. Whereas internationalization is vertical, globalization is horizontal. Globalization is about the elimination of borders. It ignores political and economic borders just as fast as new technological developments will allow. It also challenges, rather than affirms, the role of government, even to the point of questioning whether the state has any role in it.

Globalization is the result of technological advances, mostly in the technologies of information, trade liberalization and deregulation. So, globalization ignores not only economic but also political borders. Corporations integrate functions from one space and one country to another, independently of borders. They operate as if borders do not exist.

To me, globalization is the triumph of horizontal management, of horizontal power against the vertical power of the state on a given territory, and these are very, very different forces.

Seattle -- Collision Between Two Worlds

Even if Seattle failed within the conference hall, as I said, and not because of the demonstrators, this does not diminish the fact that many of the concerns that were expressed in Seattle were very legitimate.

I view what happened in Seattle as a collision between two worlds that are now juxtaposed on the global scene around the world.

First, there is the world of the international order that was reflected by 135 trade ministers meeting inside. And then there was another world outside -- one that most people saw for the first time in Seattle.

It was a very bizarre sort of world -- a world of an infinite number of participants, not at all well codified, not at all predictable, going in all kinds of directions. In comparison to the world characterized as the international order, I could refer to this world as the "global disorder."

Globalization is Not Just About Corporations

Globalization is not merely a corporate phenomenon. Greenpeace is just as well connected around the world as IBM or Microsoft, and they use the same communications tools to stay in touch and organize themselves as the biggest transnational corporations.

Indeed, many of the people outside on the streets of Seattle belong to transnational organizations, most of which are gaining a lot of power and a lot of influence throughout the world. And, like the transnational corporation, they operate as if there were no borders.

It is what I call the multicentric world. It has a lot of different centres and then goes in all kinds of directions. But that is indeed the real world of globalization. I don't want to give the impression that I think this new multicentric world is all bad. Not at all.

Much of it is very good. For example, the aid provided by NGOs [non-governmental organizations] to people in need, wherever they may be in the world, surpasses the assistance provided to those people through the entire network of UN institutions, excluding the World Bank and the International Monetary Fund [IMF]. And, the growth of NGOs in the environmental field is amazing.

The attention that NGOs pay to global problems extends beyond environmental issues to the survival of indigenous peoples, social justice, human rights and the economy. As we know, the NGOs have some harsh judgements about world debt, trade and the legitimacy of the role of the banks in international development. In a number of fields, the bargaining power of the biggest NGOs can have an impact on a state's actions.

So, the world of globalization has created, or at least greatly empowered, the very players who are attacking globalization. And they emerged in Seattle for the first time in a very forceful way. The irony is that they came to decry the very movement that brought them there!

And with the juxtaposition of these two worlds, we have a very complex consideration of allegiances. The world of the state is based on the exclusivity of its citizens' allegiances, and depends on its capacity to act while fully engaging a given number of individuals.

The multicentric world is based, on the contrary, on a network of allegiances that are not at all well codified, whose nature and intensity depend on the free will of the players concerned.

When these two worlds met in Seattle they didn't like one another very much. And I don't think they understood one another at all! The predictable outcome was, and remains, considerable tension, which I believe we will be living with well into this century.

Of course, governments will have to deal with it, but this tension is not exclusively between governments; it also involves competing sectors of society, industries, and entire socio-political, cultural, ethnic and economic blocs, as well as traditional nation states.

Too many people think globalization is a policy that governments have dreamed up, and they don't understand that this is something that we, too, are confronted with. And, it is also not something that is being imposed by corporations or big business, because many of them are also finding it very tough to deal with.

It used to be that multinationals had to repeat all the functions in every country with big, heavy corporate structures. Nonetheless, they were very big and very comfortable in the old international order. But today, they are being replaced by global corporations that integrate functions horizontally, across borders, wherever they find it most attractive -- and most profitable -- to develop.

So the multinational, too, is being challenged by globalization. It is being replaced by the far more flexible global company. And the multinational begins to look like a dinosaur now. And that's the different kind of world in which we are living.

And, if anybody has any doubts about how difficult life can be for corporations and individuals in the new age of globalization, consider another type of side effect: computer viruses sent out over the Internet.

Recently, the so-called "Love Bug" virus swept around the world messing up computer files and shutting things down all over the place. Imagine! The actions of one person or maybe a few people, resulted in headlines in almost every newspaper in the world with stories of destroyed files and countless other computer malfunctions.

Globalization can bring with it globalized vandalism -- and that is a very real concern everywhere.

Political Renewal

In my opinion, far from representing the final collapse of a trade negotiating process -- which will continue no matter what everyone says -- Seattle is probably the starting point for a process of political renewal.

In Seattle, we were reminded that the purpose of economic activity is to improve people's lives. Political leaders were sent back to do their homework with instructions to be true to the humanistic values that the West strives so hard to promote. And what we saw at work was another way of doing things whose effectiveness is now beyond question.

It was also the demonstration of the differences in reaction time between governments and globalized organizations. We're slow, they're fast!

We have to consult with our citizens, we have to get elected, we have to ensure that programs and policies are democratic and democratically applied. We have charters of human rights, we have to consult with regional groups in every country, we have to consult with ethnic communities, we have to see what the judges will think. It takes us an eternity.

Meanwhile, globalized organizations can operate much more quickly because they don't have what could be called the "encumbrances of statehood" -- the need to be responsible to all its citizens more or less equally.

So we, as governments, will have to reinvent ourselves if we want to be effective. We must, ourselves, use the new technologies to conduct politics and political consultation better and faster.

The Challenge of Exclusion

One of the first challenges -- and perhaps the biggest public policy challenge facing governments around the world today -- is dealing with globalization's most notorious spin-off effect -- exclusion. I believe we must develop creative ways to more effectively respond to this troubling phenomenon.

To understand the problem of exclusion, we have to understand how it differs from problems faced in the past. The basic thrust of globalization was moving from industrial capitalism to financial capitalism.

Industrial capitalism has certainly brought humanity to the highest level of economic, social and cultural development we've ever seen. It has brought us unheard-of prosperity which most societies have learned to redistribute fairly effectively. But industrial capitalism also brought with it exploitation, which, I am sure, requires no definition.

Globalization, on the other hand, has brought with it the first generation of financial capitalism, where we create wealth very, very differently. In financial capitalism, you don't need as many people to create wealth. As a result, some people end up being excluded altogether.

What's the difference between exploitation and exclusion?

The critical difference is that when you're exploited, your labour and muscle are still needed by the industrial capitalist system. As such, you can organize, argue for your rights, get a union to fight for you, or get better labour laws by voting for this party or that party.

The phenomenon of exclusion is far more radical than the phenomenon of exploitation. When you are excluded, you have no one to fight with, and no one to bargain with. You are on the sidelines altogether, ignored and forgotten.

So, we must work together to avoid the creation of a permanent class of "excluded persons" in our societies. I think this may be the biggest challenge facing governments in the next years.

We must also fight exclusion at the international level, because we should not forget that exclusion can affect not just individuals but also whole societies, and this can have disastrous consequences for all of us in the longer term.

Aside from the obvious and, I believe, compelling moral imperative, there is sound economic logic for trying to fight exclusion. If, because of our great progress, we allow people to be excluded, who will buy our products? How will we generate more and more wealth and prosperity for ourselves if we have fewer and fewer people to purchase our products and services?

We talk about carrying out sustainable development that will protect our environment for future generations. We also need to talk about building economies and societies that will themselves allow for the sustainable development of our own populations.

Education is Key to Success in Fight Against Exclusion

That is why I believe that education, which is the basis of all human development and at the foundation of the battle against exclusion, becomes of paramount importance.

Fortunately, today's advanced technologies make it possible to substantially enhance the power of education and bring it to more people than ever before in history. In other words, for although the new technologies can generate exclusion, they can also combat it.

This is a happy paradox whose full potential must be tapped by the political level in every country. We need to empower people to equip them with the skills and the knowledge necessary to remain part of the economic and social mainstream.

New Ethic Needed -- Women Will Play Leading Role

I also believe that women will be central to many of the solutions that we will come up with to deal with the new phenomenon of globalization. I say that because I believe there is now a new sense of responsibility developing what, in feminist literature, they call the ethic of care.

And I believe this means we are moving beyond the ethic of justice -- which has been with us since the Enlightenment -- into a new ethic of care.

We used to think that justice was the pinnacle for every society to reach for -- that every individual was treated equally under the law. But, in this new age of globalization -- when states don't make all the rules and all the laws under which their own citizens live -- there is a need to expand our concern for equal treatment under the law within a given state into a broader and wider concern for the well-being of people everywhere.

I am very optimistic that this will happen. It may not be governments themselves who lead the way in every case, but I believe governments, of necessity, must play a critical role in the development of a new ethic of care.

Future of WTO

I am also very optimistic that we will be getting into another round of trade negotiations through the WTO -- perhaps not next week or next month -- but those talks will take place.

We must and we will continue to have a rules-based international trading system that evolves to meet the changing needs of individuals and businesses in all WTO countries -- including Australia and Canada. I should add that soon the WTO will also include China. Indeed, this will be a very significant development for the beginning of the 21st century!

Working Together

In closing, I want to thank you again for giving me the opportunity to offer my perspective on where the new world of globalization is leading us and how it is changing us.

I believe that Canada and Australia will continue to share similar values and similar approaches to these issues. And I believe that we will continue to work together -- as governments, as businesses and as individuals, to come up with the creative solutions and responses that are needed for the challenges and opportunities that globalization presents to all.

Thank you.

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