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Address by the President of the Republic of Slovenia, Dr. Janez Drnovšek at the 5th Annual Conference, Boao Forum for Asia

Boao, PR China, 04/22/2006  |  speech


Today, the official opening of the 5th Annual Conference of the 2006 Boao Forum For Asia was held in China, its central topic being "New Opportunities for Asia: Driving Growth to the Next Level". One of the keynote speakers at the opening was also Slovenia's President, Dr Janez Drnovšek

Economic growth and sustainable development

Click to enlargeLadies and gentlemen, Excellencies,
First of all, let me thank the organizers for inviting me to speak here today. This truly is an impressive gathering and I am particularly pleased to find a mix of most distinguished policy-makers and world economic leaders.

The title of this panel is “New Opportunities for Asia: Driving Growth to the Next Level,” and the spirit of the Boao Forum for Asia is “win-win situations for Asia.”

Excellencies,
My message is simple: if Asia wins, we all win. Why? Our systems - economic, political and security—are all interconnected. Globalization is here and I do not see how economic development in Europe, for example, can continue progressing without progress in Asia. However, as we search for new opportunities and as our development moves to new levels, our strategy must necessarily be linked to sustainable development. Continuous economic growth and development are impossible without investing into building a sustainable economic model.

Our interdependence has given rise to the need for proactive and global engagement. Without investing into the longevity of our economic systems and without promoting global stability, our prospect of moving to the next level is doomed. Economics, especially global economics, are closely tied in with global peace.

Click to enlargeLadies and gentlemen,
Sustainable development is our key. We cannot be so shortsighted as to pretend that sustainable development is something for the future. It is a matter of the present. We have to manage our resources more responsibly and also care for our environment. The logic is straight forward. If we deplete our resources recklessly today, if we pollute our environment, our future generations will suffer. As business people, you are interested in profitability. I specifically want to stress today that you cannot be profitable in the long run if our models are not sustainable.

We are looking more and more towards corporations to play a more active role in ensuring local and global development. I very much support the Global Compact initiative launched by the Secretary General of the United Nations, Mr. Kofi Annan, the aim of which is to promote corporate citizenship so that business can be part of the solution to the challenges of globalization. There are universal environmental, social and trading principles which we should enforce. Competitive trade is also about transparency, and should also be about our common responsibility to the social environment.

The objective of sustainable development is crisis prevention, in particular building social and economic stability together with ensuring environment protection. If our economies are irresponsible—i.e. if we employ and exploit child labour, pollute our natural habitat, fail to invest into building strong local entities, and fail in the protection of human rights—we are directly contributing to the rise in local economic disparities and social tensions. These will sooner or later transform into social crisis and even conflict. Conflict and widespread social disorder are the worst enemies of business progress.

Dear friends,
We are witnessing today a moment of uncertainty in the European economic future. Our need to reform and develop leaner, more competitive economic models, and yet to retain a degree of social commitments, is both pressing and challenging. The objective is simple - we need a more economically competitive Europe. At the same time, we need a business which does not deplete the environment leaving behind waist land for our social peace.

So called public-private partnerships are increasingly relevant as a concept and a model for sustainable economic future. The idea behind such partnerships, in Europe at least, is to persuade governments to devise more competitive business environments; at the same time, some of the responsibility for the development of the local community is passed on to individual firms. At the end of the day, the best workers - in terms of productivity - are contented workers. Productivity and an individual’s overall well being have always been directly correlated.

Investing into social programs, into our environment, and into energy conservation technologies, is not an additional burden that cuts net profits and depreciates shareholder value. I know that CEOs today are hard pressed to show profits at the end of the year and that the pressure from shareholders is enormous. However, I urge you to be social visionaries as well as businessman. I propose that we agree here today on a formula by which Asian business leaders will be compelled, through tax breaks and the like, to invest in corporate social initiatives. In order to move to the next level, Asian economies will have to take seriously the need to also invest in social and environmental stability and sustainability.

Excellencies,
I mentioned at the very beginning that we live an in an integrated world. Globalization is the fundamental structuring principle of our existence today. However, as much as globalization is a matter of economic opportunity, it also bears certain responsibilities. It is no longer possible to assume that problems in distant regions and failed states have no impact on long-term profitability. They do; and frankly, this link is more direct than we may imagine it to be.

Let’s take the spread of infectious disease, or a pandemic such as Avian Influenza as an example. In every case, a pandemic has to be stopped at its source. Once the virus crosses the tipping point in terms of number of human-to-human transmissions, it is that much more difficult to stop it thanks to our integrated commerce and the frequency of human travel associated with modern business ethics.

In order to prevent a pandemic in today’s day and age, we need strong healthcare systems and early warning systems on the local level. These are obviously non existent in the case of failed states. In today’s circumstances, with the number of failed states rising, the alternative option is the closing of national borders. Governments will be forced to take drastic measures in the case of a global pandemic, including limiting the inflows and outflows of goods, people and stock. Commerce will be directly impacted, which means businesses will be the first losers.

Let me repeat, what goes on in the world matters. In our integrated world, instability transcends borders, and insecurity is connected through the complex system of interlinkage. Organized crime, terrorism, and other asymmetric threats travel throughout our complex yet integrated system almost uninhibited, but they grow and operate out of instability. Dire social circumstances, due to unjust business practices or conflict, create population shifts, which in turn disturb our social stability.

Dear friends,
We live in a world where if we don’t engage instability at its root, instability will come to us. Geographic distance means very little in ensuring our security against instability in third regions.

Because security is a public good that transgresses borders, it is imperative to think how we can become net contributors to global stability and security; it is not enough to be merely end users of security. This qualitative difference is particularly important to understand in the Asian context, where prosperity is on the rise, and thus, the ability to re-engage in the global order as active partners in the promotion of global stability has been enhanced. Gone are the days when global security was the responsibility of others.

The lesson of regional and global responsibility is, as in the case of corporations, also applicable in the case of the governments. Government-to-government interactions need to promote social stability and global peace. This means we have to hold each other responsible for upholding human rights and equality standards, and remind ourselves that it is our (governments’) responsibility to promote universal human rights and equality standards.

Ladies and gentlemen,
Sustainable development, or let’s call it business with a human face, is not a utopian dream. It is not just our moral obligation, but also a pressing need. Today the pressure is on the energy markets, with a barrel of oil surpassing 70 USD just the other day. In light of the Iran nuclear issue and other similar crisis, I do not think that we can talk today about energy security without explicitly emphasizing energy efficiency, energy conservation, and the development of renewables sources.

I see access to drinking water as the next major crisis and a source of conflict. We use water lavishly today; tomorrow we will fight wars over access to it. I thus urge us to think creatively about solutions for water conservation and about a better global distribution network for drinking water.

In clothing, let me appeal to you to think of global development and the next stage of global progress in terms of a balancing act among human rights, social stability, economic vibrancy and strategic security. This is, Asia’s win-win formula.

Thank you for your attention!
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