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ABSTRACT

The era of information technology in which we live has turned the world into a
global village. This encourages uniformity in the ways and practices of corporate
governance. The concept of corporate governance has in recent times assumed global
dimensions. This is made inevitable because of certain factors. The first is the
present era of the giant public corporation with subsidiaries and off-shoots in various
countries whose sheer size in terms of assets are larger than most nation-states. The
second is that the corporate governance structure and practices of these companies
must, of necessity be uniform and meet a minimum standard wherever the companies
operate. These therefore dictate the need for certain measure of uniformity and
consistency in corporate governance strategies and rules all over the globe. This work
shall provide a framework for analyzing and understanding these trends. It shall offer
a conceptualization of globalization that captures its historical process; its cross
disciplinary character, the distinction between types of globalization and the
contrasting nature of its impact. The efficiency and accountability of the corporation
is now a matter of both private and public interest and governance has thereby come
to the forefront of the international agenda. This work therefore will attempt to exray
the essence of “corporate governance”, its nature, framework and the impact of the
concept of globalization in corporate governance. Necessary deductions and findings
are hoped to be achieved which will assist in the improvement of the entire corporate
governance framework in Nigeria in line with global trends.
This work is arranged in seven parts. Chapter one presents details of the nature
and scope of globalization, chapter two presents details of the meaning of corporate
governance and its objectives, chapter three deals with the laws and institutions
regulating corporate governance in Nigeria, whereas chapter four dwells on the
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impact of globalization on contemporary corporate governance practices, in chapter
five the impact/effect of contemporary corporate governance practices to the Nigerian
economy is discussed. Chapter six discusses the dilemma of globalization and the
fear of local market. While chapter seven deals with the recommendation and
conclusion.

Methodology
The method adopted in this research consists of the examination of relevant
textbooks, statutes, newspaper, articles, and the internet report, case law of courts
both within and outside Nigeria, comparative analysis between the laws and
institutions regulating corporate governance in Nigeria, United States, Brazil and
other countries were equally focused upon in the cause of this research.

TABLE OF CONTENTS

Title Page i
Certification ii
Dedication iii
Acknowledgement iv
Abstract vi
Table of Content viii
Table of Cases xi
Table of Statutes xiii
Table of Abbreviations xiv

CHAPTER ONE:
NATURE AND SCOPE OF GLOBALIZATION 1
1.1 Introduction 1
1.2 The meaning and concept of globalization 9
1.3 History of globalization 38
1.4 The legal basis and regulations of globalization 42

CHAPTER TWO:
2.1 Meaning of corporate governance 46
2.2 The objectives of corporate governance 73
2.3 Contemporary practices in corporate governance 91
2.4 Forces deriving contemporary practices in corporate governance 92
2.5 The legal framework for corporate governance 97

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CHAPTER THREE:

LAWS AND INSTITUTIONS REGULATING CORPORATE GOVERNANCE
IN NIGERIA 109
3.1 Background 109
3.2 The company and allied matter act, laws of the federation of
Nigeria (LFN) 1990 (hereinafter refers to as the) CAMA 109
3.3 The regulatory institutions 111
3.4 Main provisions of the act 113
3.5 Codes of good corporate governance for banks in Nigeria 114
3.6 Convergence of corporate governance laws among the nations
of the world ( The convergence debate) 115

CHAPTER FOUR:
4.1 The impact of globalization on contemporary corporate governance
practices 120

CHAPTER FIVE:
5.1 The impact/effect of contemporary corporate governance
practices to the Nigerian economy 126
5.2 Exceptions to the rule in Foss V. Harbottle 128
5.3 Derivative action 132
5.4 Commencing a derivative action 134
5.5 Personal/representative action 138
5.6 Relief on the ground of unfairly prejudicial and oppressive conduct 143
5.7 Winding up by the court on the just and equitable ground 145

x
CHAPTER SIX:
6.1 The impact of globalization and the fear of local markets 163
6.2 Globalization sustainability and the North-South dimension 167
6.3 Basic issues of North and South trade 173
6.4 Dispute between Brazil and Philippines 188
6.5 Main arguments of the parties (preliminary arguments) 191
[ CHAPTER SEVEN:
RECOMMENDATIONS AND CONCLUSION 198
7.1 Recommendations 198
7.2 Conclusion 199
Bibliography 202

CHAPTER ONE

Introduction
Advances in technology have resulted in a greater degree of interaction
between countries, organizations and individuals all over the world. Interwoven
interests in business have grown in leaps and bounds over the last few decades.
Indeed, the internet and other communications technology have transformed the world
into a global village in which it has become much easier to identify and pursue
economic and business opportunities. Companies have thus been enabled to disperse
their operations around the globe and to manage more effectively, their production
process and inventories.
Indeed, we are experiencing unprecedented global integration. For the first
time in history, all regions of the world are inter locking their economies and
becoming increasingly inter-dependent. Therefore, if the issue and the problems are
global, the solutions must be global as well.
The governance of the corporation is now as important in the world economy
as the government of countries; 1 therefore corporate governance has become an issue
of worldwide importance. The corporation has a vital role to play in promoting
economic development and social progress. It is the engine of growth internationally,
and increasingly responsible for providing employment, public and private services,
goods and infrastructures. 2.
The global financial crisis sent new urgency to corporate
___________________________________

1, W. James: “What is Globalization”, Globalisation101.Org. A keynote Address delivered at the 2nd International Conference on Corporate Governance at Mumbai on 18-01-2002, P.1. Available at http://www.cvc.nic.in/vscvc/cvcspeeches.sp22. January 2002. (Retrieved on 2008/3/8). 2. Ibid.
2
Governance, which unleashed unprecedented volatility in markets, led to devaluation,
default and capital flight, with the brunt borne by the poor. Reform on governance
could no longer be viewed as a national or local issue for any corporation.
Globalisationhas brought in its wake, the need for international coordination of efforts
to ensure that growth is sustained and shared; sustained in that it is robust and can
withstand shocks – and shared in that it brings prosperity to the many, rather than the
few.
Besides technology advances, another driving force behind the recent rapid
gloablisation process had been liberal governmental policies that have opened up
economies both domestically and internationally. Many governments have adopted
free – market economic systems, which have increased their own productive potential
and created a whole lot of new opportunities, Corporations have built foreign factories
and established production and marketing arrangements with foreign partners.
Globalization has therefore given rise to an international industrial structure in which
thousands of the world’s largest corporations maintain operations in multiple
countries 3.
There is also this growing realization that capital markets and corporations are
created by society and must therefore serve it, not merely profit from it and that
consumers’ and citizens campaigns’ can make all the difference. In this age of
globalization, corporations and business enterprises are no longer confined to the
traditional boundaries of the nation – states.
Whether the company is state or privately owned, whether it requires Local or

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3. Op. Cit. pg. 1.

3
International Capital, governance is critical. From a Corporation’s Perspective, the
emerging consensus is that corporate governance is about maximising value subject to
meeting the corporation’s financial and other legal and contractual Obligations. This
inclusive definition stresses the need for boards of directors to balance the interest of
shareholders with those of other stakeholders – employees, customers, suppliers,
investors, communities, in order to achieve long-term sustained value. From a public
policy perspective, corporate governance is about nurturing enterprise while ensuring
accountability in the exercise of power and patronage by firms. The role of public
policy is to provide firms with the incentives and discipline to minimize the
divergence between private and social returns and to protect the interest of
stakeholders.4
In pre-globalization era, what corporations did was mainly their personal
business within the units of national legal and regulatory framework, as well as
internal policies and controls established by the companies themselves, if any. But
with the increased interwoven interests between corporations and nations and
particularly, since the corporate scandals of the 90s and early 2000s, all of that has
changed. Governments are beginning to demand a higher degree of accountability,
transparency; and responsibility from the management of corporation; legal and
regulatory framework are consequently being tightened up in order to avoid the
collapse of companies which has serious negative consequences for national
economies;

___________________________________
4. Opp. Cit. pg. 2.

4
5 Multilateral and international financial and development Organizations have equally
been engaged in drawing up codes of good corporate governance and best practices
and demanding that both member and non-member countries adopt such codes and
best practices, subject to modification and further elaboration to suit local
circumstances 6. It is therefore becoming increasingly difficult to find a hiding place
anywhere.
In the world of today, the degree to which corporations adhere to basic
principles of good governance is an increasingly important factor for making
investment decisions. This is particularly relevant in view of the relationship between
corporate governance and the international character of investment. For companies to
reap the full benefits of the global capital market and attract long-term capital,
corporate governance arrangements must be credible, well understood across borders
and adhere to minimum standards of accepted principles.7
It is worthy of note that corporate governance is only a part of the larger
economic context in which firms operate. The corporate governance framework as
earlier stated depends on the legal, regulatory and institutional environment. Factors
like
____________________________________
5. For instance, the Sarbanes – Oxley Act of 2002 passed by the United States in response to the collapse of Enron, amongst others of her major corporations; the United Kingdom Combined Code: Principles of Good Governance and Code of Best Practices of 1998, which was raised in 2003; the German Corporate Governance Code of 2002; the king Report on Corporate Governance for South Africa, 2002 all of which and more can be accessed at http:// www.ecgi.org/ codes / all codes. Htm. (Retrieved on 2008/3/8). 6. The OECD (Organization for Economic Corporation and Development) Principles of Corporate Governance 1999, PMBL, available at http://www.oecd.org /aboutgeneration index. Html; the Principles are currently under review. The World Bank has also proposed guidelines for good corporate governance in the financial sector because of the critical role of the sector as the main vehicle for robust economic growth and effective transmission of monetary policy, see J.O Sanusi” “Enhancing Good Corporate Governance. A strategy for financial sector Soundness”, keynote Address presented at the Dinner Nite of Chartered Institute of Bankers of Nigeria, November 8, 2002. Available at http:// www.expdisc.com / governance.htm. (Retrieved on 2008/3/8). 7. The Draft Revised Text of the OECD Principles of Good Governance, January 2004.
5
business ethics and corporate awareness of the environmental and societal interest of
the communities in which a company operates can also have an impact on its Long
term success. 8
Globalization and corporate governance are very wide in scope, Globalization
of corporate governance mechanisms is one of the most significant developments in
international economics in the last two decades. The effect of globalization is
profound and its integrative momentum powerful. It challenges the adaptive capacity
of the nation – state and demands new processes of democratization. The shift to a
global economy suggests the needs for transnational forms of governance. Developing
states view globalization with suspicion suggesting an attempt to overwhelm them in
this unequal partnership.
As elucidated here upon the two definitions from public and private
perspective provide a framework for corporate governance which reflects an interplay
between internal incentives that define the relationship among the key players in the
corporation and external force, notably policies, legal regulatories and markets, that in
turn govern the behaviour and performance of the firm.
The relations between globalization, and corporate governance practices are,
right now, matters of great importance to citizens, to government and to non-
governmental organizations all over the world. They are, therefore, of great concern
to the legal profession which we belong to and whose professionals we adore and
cherish.
The hopes and expectations shared by men of this noble profession during the middle
decades of the 20th century, were that the world would become increasingly more

__________________________________
8. OP. Cit. .
6
law-abiding during the 21st century. This was based on the assumption that this
progress towards a more lawful world would, almost automatically, grow on what
used to appear to be the foundation of an unprecedented system of international law,
built around the United Nations and its agencies, particularly the International Court
of Justice and the various international conventions and treaties agreed upon since the
second world war. These hopes and expectations have been rudely dashed.
International relations are increasingly sinking into disorder and chaos.
Criminals, Semi-Criminals and criminal organization, have taken over control
of key levels of power in many governments and control of powerful trans-national
corporations and banks in many countries. They are systematically stealing public
funds, plundering and taking over the ownership of vast natural resources, ripping off
citizens, defrauding shareholders and milking huge transnational corporations.
In some parts of the world, criminals, parading themselves in one corporate,
political, ethic or religious disguise, or another have established dubious personalities
and other forms of mischievous associations operating in complete violation of the
corporate body principles and objectives. They are unleashing violence within
national and across national corporate bodies claiming to be pursuing goals which are
as hazy as they are dubious.
The topical theme and its wide ramifications and implications concerns the
concept of globalization. Over such, we cannot avoid facing up to the question of
what exactly is globalization? In this work an attempt is made at this which
constitutes one major component of the theme of this research.

______________________________________
7
There are so many definitions on globalization. But, the essence of the
conception of it, which is dominant now, seems to me to be that globalization is
basically, the intensification, over the last two decades of the interconnection and
interdependence between all parts of the world, particularly at the levels of economy
and communication, such that former national barriers to the movement of
information, finance, goods services and entrepreneurship, are being drastically
reduced and everybody now has to compete with everybody in what has now become
global village and a single global market. This is presented as a new phenomenon,
marking a distinctly new epoch in world history, which has roots in earlier periods,
but which has come up, since the early 1980s, sweeping everything before it.
According to this conception disseminated every hour of the day, world-wide,
by pundits, academics, journalists and politicians, in newspapers, magazines,
websites, and on radio and satellite television, you either submit to the power of its
gale-force wind, or you are swept away and dumped, impoverished and incapacitated
on the margins of human progress; progress brought about by these forces of
globalization. This dumping away of the margins of human progress is said to be what
is happening to most of us in what is called, Sub-Sahara Africa.
This notion of globalization appears on the surface to be convincing. But does
it capture the actual realities of the commemoratory world economy, as it has
developed since the early 1980s? Is this globalization, as it is conceived in this
widely disseminated way an empirically valid concept? Does it really tell us what is
happening to the whole of mankind and to the relations between various parts of the
world at the levels of even only economy and communications?

____________________________________
8
Is it a United States (US) scientific concept, correctly defining contemporary
realities, or is it merely an ideological construct, an effective marketing slogan?
Considering the global trade claim of globalization, this is the removal of
barriers to international trade and the expansion in this trade over the last two
decades. There is no doubt that the volume and value of international trade has grown
rapidly and in some of the sub-sectors of manufacturing, it has come to increasingly
involve the establishment of different stages of the production process in different
parts of the world. This is what is called spatial optimalization, or off-showing.
But the fact of the matter is that for the overwhelming majority of mankind
who live in Asia, Africa, South and Central America, the most important goods they
produce and live from are commodities derived from Agriculture, including livestock
rearing and fishing. The barriers to international trade in these goods in the form of
the heavy subsidies and other protection policies and practices of the United States of
America, the European Union and Japan, are still as high as ever.
It is not only the notion that we are living in a global village which is a
fantasy. The belief that the whole world is now largely one huge global free market is
an illusion. When we obtained and examine the concrete evidence about how the
contemporary world economy operates, revealed much more widely from the
revelations arising from the dramatic collapse of transnational corporations like
Enron, we realize that far from a global free market existing, we have a specific type
of international market organization which is highly regulated and manipulated by the
ruling elite of a handful of countries, to serve their purposes. These elites use naked
military force,

___________________________________________
9
the control of international organizations which they have hijacked and on an hourly
basis, pervasive and intensive media campaigns of brain-washing, to enforce their
laws and of their business, accounting companies and law-enforcement organizations,
so that they always call the shots and can continue to corner most of the wealth
produced in the world, giving to the rest of the world, very little, in return except
pieces of paper. As for the information revolution which is presented as a major
component of globalization, how much of a revolution has it been in terms of the
exchange of actual information between different section of mankind and how much
has it been a technological revolution, which has not even started to move towards
realizing its exchange have been put into the service of marketing a consumerist way
of life and marketing the market and its psychological, political and military
underpinnings.

1.2 The Meaning and Concept of Globalisation
In most parts of the discourse on globalization, the impression created
is that it is a new phenomenon. However, Wallerstein’s Collection of Essays9
provides a profound insight into the phenomenon as being at least two centuries old.
“In the nineteenth and twentieth centuries, there has been only one world-system in
existence, the capitalist world-economy”. The point of emphasis is that, capitalism
was from the beginning an affairs of the world-economy and not of nation states.”

_______________________________________________________ 9. I. Wallerstein, (1979) The capitalist World Economy: Essays, Cambridge University Press. Essays is actually the subtitle of the book The Capitalist Economy by Cambridge University Press. One critical highlight of direct relevance in the book is the reality and historical process of uneven and combined development characteristics of the World Capitalist Economy. This characteristics is now more popularly referred to in terms of “international division of labour” or “the inequalities of core and periphery”, to invoke Wallerstein’s exact description (p1).

10
Thus, capitalism in essence has always been global in nature. Under it, “economic
activity is not only international in scope, it is also global in organization”. Some
analysts trace its origins even back to the 17th century, “when colonial empires began
to crave out the globe in search of raw materials and new markets for their
manufactured products”10. In this perspective, Steingard and Fitzgibbons11 submit
that “the globalization of capitalism is the contemporary manifestation of a system
that evolved over several centuries, the primary purpose of which was to be the
economic servant of western society12.”
Pushing the discourse further into linguistic historical perspective, Walck and
Bilimoria13 served the reminder that, “globalization as a unifying discourse used to be
called ‘empire building.” The list of such empires include those of Roman, Mongul,
British, Soviet and the American empires, “all political entities underpinned by
military force which spread their ways of life across significant land masses and
diverse populations as they extract economic benefits for the state through
enslavement and taxation.

_____________________________________________
10. Gereffi, Gary et al (2001) Globalization Value Chains and Development, IDS Buletin Vol. 32 No. 2, pp 1-8. 11. Steingard, David S and Dale E. Fitzgibbons (1995), challenging the Juggernaut of Globalization: A Manifesto for academic Praxis, Journal of Organizational Change Management, Vol. 8, No. 4 pp 31-54. 12. On the economic front, the explanation is that, “In the Western Nations, market saturation and minimal population growth forced manufacturers to look elsewhere for receptive consumers and cheap labour (ibid, 9. 31). At a broader level, it is argued that objectively, globalization translates to an ideaology – hence it is not value free. The primary objective of their effort really is ‘deconstructing the four myths of globalization; the myths being: globalization leads to one healthy world culture; globalization brings prosperity to persons and the planet; the global market spreads naturally, and management literature presents a value free representation of globalization. All these are effectively challenged. 13. Walck, Christa L and Diana Billimoria (1995), Editorial to the theme Challenging the Globalization Discourse, Journal of Organizational Change and Management, Vol. 8 No, 4.

11
To Sheth14, “globalization is a coalescence of different transactional processes and
domestic structures allowing economy, politics, culture and ideology of one country
penetrate another … underway since the 15th century”.
However, the new globalization characterized by Williamson15 as
globalization renaissance, is unique in two critical respects, namely: (1) a liberalizing
property – with emphasis on market deregulation; and (ii) primacy of transactional
corporations (TNCs) as it is the carrier-like the old forms of globalization in which the
carrier was the state. This is without prejudice to the fact that the state remains an
accomplice. The processes that define this new, liberalizing globalization over the
past two decades in particular, include the following16: (i) Rising flows of short-term
foreign investment based on speculative currency trading; (ii) Increase in long-term
foreign direct investment; (iii) Growth in world trade, with policies aimed at further
reducing barriers to trade; (iv) Growing share of global production and trade
associated with transnational corporations; (v) Accentuation of global
interconnectedness of production, resulting partly from changes in technology of
production and servicing; (vi) Increased movement of people for trade and labour
purposes; (vii) Intensification of the global reach of new forms of communication,
including television and internet.
These processes and unique characteristics of the new globalization spawn a
mixture of beneficial and penalizing consequences, globally and locally. For
example, its cited benefits include: increased specialization and efficiency, better
quality products at reduced prices, economies of scale in production, competitiveness
and increased output, technological improvement and increased managerial
____________________________________ 14. Sheth, V.S. (2000), Globalization and the South African, State, African Quarterly Vol. 40, No. 3 pp 45-66. 15. Williamson, Jeffrey G. (1997) Globalization and Inequality: Past and Present, Research Observer (World Bank), Vol. 12, No. 2: pp 17-133. 16. Deacon, Bob (2000); Liberalising Globalization: Challenges to Social Policy and Development, UNRISD Occasional Paper No. 5, Geneva.

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capabilities17. On the other hand, globalization is faulted for its negative
consequences such as: increased inequality both within and between countries and
increased impoverishment, increased social risks of rising unemployment and crime,
increased chances of exclusion of individuals, communities, countries and regions
from its potential benefits, and weakened capacity of government to fulfill its
economic and social obligations to the citizenry, and the rapid spread of shocks and
disturbances from one financial market to another18.
It is evident therefore that the consequences of liberalizing globalization are
far-reaching and of legitimate concern. In particular, there are weighty misgivings
about the consequences and the marginalized status of developing economies like
Nigeria. This concern informed the tone of the Malaysian Minister’s speech at the
Uthant Distinguished Lecture in June 2001. In the speech, Dr. Mahathir Bin
Mohammed was both definitional and critical:

Globalization is today’s flavour. However, it has turned
sour even before it has been tasted by the majority of
the people of the economies of the world….
Globalization is presently made synonymous with and
exclusively about a totally free, unregulated world
market. It is absolutely tied to total deregulation within
countries and between countries19.

_______________________________________ 17. P. J. Obaseki, (2000): Globalization and the Nigerian Economy, CBN Economic and Financial Review, Vol. 38 No. 2 (June). 18. Obaseki, Deacon and Bob (2000); Liberalising Globalization: Challenges to Social Policy and Development, UNRISD Occasional Paper No. 5, Geneva. 19. Mahathir Bin Mohammed “Globalization, Global Community and the United Nations”, at the U thant Distinguished Lecture series in Tokyo, Japan on June 7 2001. Excerpts of the speech are contained in the Guardian on Sunday, Lagos, July 8 2001; p.3.
13
If this sounds typical of the protesting voice of a weak player in the
globalization game, observers from the highest benefiting point, United State of
America, interestingly share the pessimistic view that:

The unalloyed enthusiasm that accompanied the spread
of globalization in the last decade is no longer with us.
It has fallen victim to unexpected financial crashes,
important policy reversals such as those in Malaysia and
Russia, and many unresolved problems with potentially
disastrous consequences, from Japan’s fragile banks and
China’s insolvent state enterprises to Brazil’s huge
public debt…. Enthusiasm about globalization has also
diminished in the face of other newly acquired
collective knowledge.20

The concept of globalization has acquired considerable emotive force. Some
view it as a process that is beneficial to future world economic development and also
inevitable and irreversible. Others regard it with hostility, and some with fear
believing that it increases inequality between nations, threatens employment and
living standards and thwarts social progress. Consequently, two schools of thought

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20. Moise Naim, Editors note in Foreign Policy, (Winter 1998-1999; pp 8-9). Thus, we see that even to the protagonists of globalization, its limitations are becoming obvious. This informed the conclusion of the paper, The End of Complacency, by Calude Smadja – in which he declared: “we now know that the process of globalization needs to be elevated beyond any attempt to impose a single economic model, a scenario where only the strong will survive. T he challenge of globalization is to attain a synthesis that is acceptable for every region – and above all else, develop a system that takes into account cultural and historical specifications; one that is agreed upon, not one that is imposed”. See Foreign Policy (Winter, 1998-99; p. 71).
14

have emerged to explain the meaning and nature of globalization. The first is the
liberal school, while the second is the radical school of thought.
Essentially, the liberal scholars see globalization as a process of freeing
economies? So that trade between countries can take place more easily. Freeing in this
context means providing opportunities for business to make profit while reducing the
states role as a producer or deliverer of services. It is “a process of integrating,
economic decision making such as the consumption, investment and saving process
across the world21. Globalization is the process of shifting autonomous economies
into the global market – the systematic integration of autonomous economies into a
global trading environment 22. Okon sees globalization as a process of creating a
global market place in which increasingly all nations are forced to participate.
According to him the key elements of the process are: the inter connection of the
economic rules that govern relationships between these sovereign nations, creating
structures to support and facilitate dependence and inter connection and creation of a
global market place 23.
According to Odozi, globalization is the rapid integration of trade relations
and productive and investment decisions across the globe by economic agents who
employ and move investment capital and technology around to take advantage of
environment where their competitive edge can manifest in high returns.

________________________________________ 21. M. Kwanashie: “The concept and process of globalization” CBN Economic and Financial Review, vol. 36, No. 4 (1988) P. 341. 22. Ibid. 23. E. E. Okon: “Foreign Investment and National Security in Developing countries under the globalised Environment: The Nigerian Perspective” A paper presented at the Round Table on international trade and globalization: Challenges for Nigeria, hosted by the Nigerian institute of Advanced legal Studies, Lagos on the 18 June, 2002, P.7.
15
It is by this process he said, that the world economy has been reduced to a “global
village”, something almost akin to a village market with all its simple and fast
business relationships 24.
Globalization is about an increasingly interconnected and interdependent
world and this has many important dimensions such as economic and social, political
and environment, cultural and religious25. The various dimensions affect people,
institutions and countries positively or negatively. Obadan went on to elucidate on the
economic aspect of globalization, which is perceived to be at the heart of the
globalization, process. Economic globalization according to Obadan, refers to a
process of change towards greater international economic integration through trade,
financial flows, exchange of technology and information and movement of people 26.
Economic globalization is also seen as the “contemporary internationalization of
major financial markets, of technology and certain important sectors of manufacturing
and services.27
Khor sees economic globalization as the external liberalization of national
economies by breaking down national barriers to economic activities, resulting in
greater openness and integration of countries in the world market 28. In most
countries, national barriers are being removed in the areas of finance and financial
markets, trade and direct foreign investment. Khor asserted that the current
globalization process is extended to national policies and policy-making mechanisms
where national policies (including those in economic, social, cultural and

___________________________________________ 24. V.A Odozi: “Trends in Globalization of the World Economy and implications for Nigeria”, “CBN Economic and Financial Review, Vol. 36, No. 4, (1988) P. 330. 25. M. I. Obadan: International Trade and globalization: Social Political and Economic Realities for Nigeria. “A paper presented at the Round Table on international Trade and globalization: Challenges for Nigeria, hosted by the Nigeria institute of Advanced Legal Studies, Lagos on 18th June, 2002, P.1. 26. Ibid 27. I. A. Ayua: “International Trade and Globalization: An overview of its implication for Nigeria”. NIALS Round Table on International Trade and Globalization: “Changes for Nigeria”, Lagos, June 18th 2002 P.5. 28. M. Khor: The Economics of Public Enterprises (London and New York: Routledge, 1991) P. 200.
16
technological areas) that until recently, were under the jurisdiction of states and
people within a country, have increasingly come under the influence of international
agencies and processes or of big private corporations and economic financial players
29. Other liberal scholars see contemporary globalization as multi dimensional.
According to them, while the economic dimension constitutes the heart of the process,
it is far from being merely economist. Gardwe, agrees that the economic dimension
constitutes the motor that drives the globalization process30. He further asserted that
the economic dimension with the macro-economy- such as trade flows, marketisation,
capital flows, technological transfer and the dominance of transnational corporations,
equally constitutes the motor that drives globalization process. Furthermore, he stated
that the new information and communication technologies (ICT) constitute the oil that
fuels the process. Instinctively, the liberal scholars believe that markets promote
efficiency through competition and division of labour that is the specialization that
allows people to tap the benefits of more and larger markets around the world. This
implies that they can have access to more capital flows, technology, cheaper imports,
and larger export markets. This view is shared by Bayis and Smith, 31 who defined
globalization as a process of increasing inter connectedness between societies far
away. According to them, a globalised world is one in which political, economic,
cultural and social events become more and more extensive and more deeply
influenced by events of other societies. According to them, the world seems to be
shrinking and people are increasingly aware of this development as can be seen in the
extensive use of the world web (www), the electronic mail, the world wide television
communication and global newspaper, among others.

____________________________________ 29. Ibid. at 15. 30. G. E. Gardwe (2001) “Making Globalization Work in Africa” in finance and development. Article Xv December, 2001. 31. Bayis and Smith “Globalization and Local Development in Africa and Latin America” CODESRA Bulletin Nos 3 and 4. (1999)
17
In the view of Olisa, globalization is one on-going gigantic movement initiated
and pushed forward by the developed capitalist and industrial western nations32. Thus,
globalization aims at removing or weakening territorial and jurisdictional boundaries
and barriers of individual nations. The overall ambition is to establish a world free
market economy and open political system in which all nations would participate and
operate along a set of rules and conventions. He then listed some of the ingredients of
globalization as follows:
(a) Removing all barriers on investment and investment capital
(b) Encouraging competition for agricultural and industrial product in the free
market
(c) Dismantling territorial boundaries
(d) Apply the vaccines of Structural Adjustment Programme (SAP) to all nations
in order to equip them for effective participation in the world economy.
Clark observed, that globalization fosters economic efficiency and encourages
international institutions and problem-solving. According to him, the process should
be welcome for the effect it has in promoting societal convergence but around
common recognition of the benefit of markets and liberal democracy33.
In summary, the liberal scholars believe that the globalization process
(a) is neutral and an inevitable part of historical change
(b) will increase wealth and prosperity for all countries and peoples including

___________________________________ 32. M.S.O. Olisa, “Nigeria and globalization: Lessons from the United States” Paper presented at a public lecture organized by the center for American Studies, University of Nigeria, Nsukka. (1999) 33. I. Clark. “Beyond the great divide globalization and the theories of international relations, Reviews of International Studies, vol. 24 No 4. 2000
18
workers. The World Bank Report of 200234, observed that increasing globalization
helps to expand opportunities for nations and on average, help workers in rich and
poor countries alike.
The radical scholars have collectively questioned the logic behind globalization and
described it as old wine in a new wineskin. A. H. Asobie 35 for instance has observed
that globalization in its current phase, is essentially the universalisation of capitalism,
in its speculative variety. According to him, contemporary globalization is
synonymous with the emergence and dominance of an enormous amount of “virtual
money” – that is, highly mobile, speculative capital. He argued that in its current
manifestation, globalization is not simply the product of the inexorable match of
market forces. Accordingly to him, it is the outcome of conscious planning and
execution, first, by “big business” namely the multinational corporations and second,
by the governments of the United States and the United Kingdom.
Essentially, Asobie is of the view that globalization is a technique of
ideological marketing. It was devised by global entrepreneurs primarily to counter a
rising trend in the under developed world. This is the trend towards tougher laws,
especially in the areas of transfer of technology, patents, collection of levies, control
of foreign business and prevention of the drain of foreign capital.

___________________________________________ 34. The World Bank, World Development Indicators (Washington D. C International Bank for Reconstruction and Development, (2002). 35. A. H Asobie. “International Relations, Foreign Policy and the Prospects and problems of Globalization” paper presented at the ASSU State of the Nigerian National Conference on the theme. The Crises of the Nigerian state: Perspectives and challenges” Held in Abuja on October 14 – 17, 2002.
19
Ibeanu. Questions the whole argument about globalization, including the illusion of
one world, myth of inevitability and identical effects36. On the issue of one world, he
argued that while it is true that problems are becoming global, the world is still as it
is, full of regional variations. According to him, apart from central Europe, all the
world’s displaced people are in the third world. On the myth of inevitability of
globalization, he argued that there is nothing inevitable or automatic about the
phenomenon.
Essentially, the radical scholars see nothing new in the globalization process.
Consequently they have classified the concept as a new form of imperialism. A recent
undated booklet titled “Alternative view of Globalization” described the phenomenon
as a new world war. According to the documents:

A new world war has begun, but it is against humanity as a
whole In the name of globalization, this modern war
assassinates and Forgets — as in all world wars, what is at
stake is a new divisions of the world. This new division of
the world consists of increasing the powerful and misery of
the miserable.

Strictly, the radical scholars believe that the term globalization is not very elegant nor
is it very precise. As a result, discussions about globalization are conducted, often,
without consensus. This makes the debate at times rowdy, heated and superficial. In
the circumstance, the person who shouts loudest and filibuster with supreme
confidence may win the day.

___________________________________ 36. O. Ibeanu “Reflections on Globalization and American Pragmatism: An Africa viewpoint Nsukka, Apex Publisher, (2000) p. 19.
20
They believe that scholars in their idle times conjure up ideas which they then
propagate for the consumption of the less endowed. At times, some of their positive
hallucinations take rounded shapes or wings and fly into universal orbit. Very often,
these scholarly enterprise open the way to new human activity by extending the
frontiers of knowledge. They equally believe that visionaries as well as charlatans
also gain from such positive hallucinations. Until celestial globes disintegrate,
mankind will not be short of visionaries and those who revel in transitory fashions or
facts. They believe that some scholars have contempt for the “Idiot boy” who reached
his mark from absolute defect of knowledge, yet, receives fan mails. That from time
to time scholars introduce new concepts after collating the mysteries of their
experience over the failure of the last slogans, which has proved meaningless in
improving international relationship in the last five years or so, a new alluring
sloganeering has pushed itself into intellectual and global agenda or discourse.
Against all articulated authority, the issue of globalization is making the
rounds. Some people pretend to understand its literal meaning which depends upon a
rather blinkered vision of its content. For they argue that we are not clearly told who
is globalizing and who is being globalised. The radical scholars believe that those
who are susceptible to the slightest impulse from studies in international relations
wonder what others are talking about in a world where Europe has tightened its
immigration policies; people are still called illegal immigrants; visas are now issued at
the price of gold; discrimination is still a subtle game played by some states and
communities, an inequitable international economic order exists; some slaves have
over-powered the

____________________________________________
21
national currencies of other nations; and “man is still wolf to man37”. They believe
that globalization is neither an acute nor profound opinions. Its parameters need to be
defined properly before they all get carried away again. They recall with nostalgia, the
slogan, “New International Economic Order”, “New International Information Order;
“World Government;” Perpetual peace” and other such formidable anecdotes. To
some people, it looks as if globalizations is of contemporary concern but its exotic
print is hard to decipher in a world in which global trends are very divergent. Yes,
they believe that no common denominator has yet been found. In a world beset with
mishaps and misunderstandings, the argument for a global society is not
predominantly motivated by the desire of oneness or equal belonging but an apparent
wish to discourage opposition to present historical injustice in the world. The recent
crisis in Iraq adds to the fear people entertain about globalization. It is their belief too
that there are problems which citizens of a state cannot solve without external
assistance. For example, the people need assistance if a government they have voted
for decides to denigrate their rights. In spite of this positive aspect of the globalization
process, the need to preserve the independence and sovereignty of states until,
perhaps, supra – national entities bigger than modern states emerge has to be
considered. For example, if an American – Russian Republic and an Indo –Chinese
state, a Latin American Republic and an African state emerge, then a milepost
towards globalization would be easy to sight. Globalization to them would become a
reality if opportunities are democratized and risk – takers are assured of safeguards.
The Iraq experience frightened Third World States because to destroy Iraq in order to
rebuild it is hard to understand.

_____________________________________________ 37. H.R. Hammouda “Rethinking Breton woods from an African perspective” CODESRIA Bulletin, No. 3 and 4 (1999).
22
It is their belief that the Phenomenon of globalization could start by transforming
present regional groupings into sovereign entities. New institutions must be allowed
to flourish. These states but individuals; groups and multinationals. The policy of live-
where –you like must be encouraged. There should be no reservations. As the ice in
the North Pole threatens Europe by thawing, a place in the sun for Europeans would
fit into an agenda for globalization. Africans must be prepared to receive European
refugees driven not by war or by weather. For globalization to take root, we must
ban visas, endorse free immigration, ensure cheap transportation world wide, and
entrench a culture towards other races, tribes and ethnics groups. A new technology
must develop to underscore the equality of all peoples. A permanent ban must be
placed on those with Luciferian habits of mind. As of now, a global community seems
to be developing its worn dynamics. This has become more pronounced in the
financial and economic spheres than in other areas. In a world dependent upon its own
resources, which no state possesses in abundance, the trend towards globalization
should be speeded up after addressing the preliminary objections raised earlier;
Europe has forged on very well. Its history has been a progressive run from antiquity
through the Renaissance, the industrial Revolution and its Shameful Colonial exploits,
to the Euro-dollar age. It is not yet clear where to draw the line between the concept
of world society and the international community. The latter implies a place where
there is more concern for events that happen to other people and nations than in one’s
state. The globalization process has received a boost through a marked improvement
in electronic mail communications world wide. A global village is now a reality.
Surely, a preservation of the eco-system is very important

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23
in order to ensure the continued existence of man. This implies the destruction of the
cold war arsenals of military technology if they cannot be converted and put to good
use. If the pressure on Iraq to disarm was the real reason for the war, it could have
been justified. However, we now know better; the radical scholars exclaimed.
Globalization to the radical scholars would require de-militarization of the
state so that useful, healthy, young people would become profitable partakers in the
economic production process instead of wasteful consumers of our common wealth in
the name of militarism. The question has been asked; “will the fruit of globalization
result in the decline of the west?” The west is facing stiff competition from Japan,
South East Asia and the emergent Russian Republic. The events of the September 11,
2001, the crusade against terrorism has introduced fear, insecurity and decline in the
affluence of the west. Jobs are gone, travel is restricted, the economy is weak. May be
globalization can rescue the west from throes of a self imposed imperial rule, the
radical scholars suggests.
The crucial impediment to globalization lie on how the world can resolve the
contradictions of culture, religion, democratization of the world resources, distribution
and exchange. This planet earth can accommodate all of us but super-power
consciousness and arrogance may impede the process, says the radical scholars.
Recent dynamic changes in world affairs seem determined to change our
precious notions of studying or understanding international systems.38
System theorists whose prestige rose to high heavens in the late 1960s must be
shocked to note that the methodology which cast aside the human dimensions have
run

___________________________________________ 38. G. Obiozor: No. 11 A Seminar Paper titled. “The Soviet Union and the New World Order” August 30, 1991, P.2.
24
into serious trouble in the late 1980s and certainly today in 2006.39 A human
dimension is returning to the scene of international politics as in the 1930s, 40s and
50s as the main focus for understanding and analyzing events within the international
system. 40 The emergence of the United Nations created a global forum for wider and
intense debates on human rights, the right to democracy and internationalism.
However, as détente allowed states to heave a sign of relief, states recoiled in pursuit
of their nation’s interest in the post World War 11 era. The cold war years witnessed
the American attempt to dominate the global political economy through the use of
military might and soviet opposition to this global hegemony. In spite of this political
struggle, there was a consensus that “the reconstruction of the post- war world be
based on liberal-democratic values derived from universal and absolute principles.41
Compromise and accommodation became acceptable globally as modus
operandi for the pursuit of peace and development. It was also realized that the
people’s participation in electing their leaders gave legitimacy to good governance.
The New World Order saw American as a military-strategic and economic power
while the soviet union was a military power. Germany and Japan became economic
powers. Having achieved a balance of terror in their military – strategic
innovativeness, they pat in place stratagems for safe guarding their deadly arsenals by
the exchange of nuclear information through the international Atomic Energy Agency
and other regulatory bodies. As a result of political and socio-economic failures, the
Soviet system collapsed in 1989 and a

______________________________________________ 39. OP. Cit. pg. 23 40. Ibid 41. Ibid
25
unipolar world emerged. The United States did not hesitate to impose its might on
those states like Iraq, Iran, North Korea, Cuba, Syria, Yemen, China, Libya,
Afghanisatan etc. that disagreed with its imperialist policies.
As in all colonialist and imperialist actions, an ideology or patterns of thought
must be coined, as loading shadow. Relying on its great centers of learning and
research, which are well funded, the term globalization was given added impetus in
the 1990s. Their formidable arsenals of inchoate and speculative dogmas have served
to give a “boost” to good governance. The assessors of “Best practice” is the United
State of America and the international community, its junior partner and ally. As a
result of the way the United States of America has pursued its policies in
Afghanisatan and Iraq, people have come to equate globalization with a new form of
colonization and hegemony. Concretely these radical scholars draw attention to the
philosophical component of globalization which permits wars that cause social
dislocation, regime change, global Euro – American companies as agent global
economic domination through the concept of global corporate governance, with the
“G7” association of leading economic states as its arrows – head. These small
powerful groups dictate principles and policies that shape globalization. Their cartels
dictate at which price raw materials are to be bought from developing nations and at
what price finished goods should be sold to the third world states. This blatant
inequality in the international division of labour is both the proximate cause and
immediate cause of the debt peonage into which the world is moved and its
sustainable poverty.
In globalization process the radical scholars assert, “tribute” must be paid to

_________________________________________
26
international monetary fund, the World Bank and other Bretton woods financial
institutions. They monitor the Economic conquest of the globalised world. This they
do though currency regulations and the rate at which liquidity flows around the world.
They also preside over compromised powerless leaders, powerless states, and
powerless people in the third world. At times, to make assurance doubly sure, they
second their elite staff to control and stir our economies in the spirit of globalization.
Under the impact of globalization and bad governance, therefore stratagems like the
structural Adjustment programmes, exorbitant fuel prices, galloping inflation, and the
people are weakened to the point of their inability to pursue their democratic rights
which had been severely reduced to occasional castings of their votes.
A new weapon in the globalization arsenals in the newfound convenient
excuse – the fight against terrorism. While it would look irresponsible for any one to
question the global fight against terrorism, only few seem to reflect seriously on the
remote and immediate cause of terrorism. The fight against terrorism has become an
instrument of fostering homeland security, aggressive wars, threat to state that do not
know imperialism. As the Guantarnamo Bay experience has shown, the cherished
democratic values have been discarded on the alter of frenzied and hallucinating
intelligence reports and fear – including security announcements, airport
announcements, airport harassment of travelers and high cost of security precautions
often guip colossal sums of money.
In summary, the radical scholars believed that globalization is:
(a) increasing world poverty, perpetuation of bad governance structure,
unemployment and lowering the living standard of workers and women;

_________________________________________________
27
(b) Increasing the gap between the rich and the poor;
I simply see globalization as the last stage in the development of capitalism. It
is a process of restructuring, re-organizing and re-ordering the world political
economy to ensure that maximum development of the capitalist system that will
generate prosperity and peace for the advanced capitalist societies and their
multinational corporation of capitalism is to maximize both production and marketing
of goods and services world wide with little or no hindrance. As Asobie42 observes,
globalization is a programme of action, a strategic plan. The authors of the plan are
multinational corporations based in Europe and America and the government of the
United State of America and United Kingdom. In fact, what is happening can no
longer be explained by citing the forces of demand and supply. The true position is
that in the early 1970s, industrialists in the developed capitalist societies faced a major
crisis; that is, the crisis of over production and under consumption. Efforts were made
to penetrate the markets of third world countries, but the protectionist policies of these
countries made these efforts impossible.
As a result of the twin problems of over production and under consumption,
the Western Capitalist started exploring various ways to survive. First, those who
decided to remain in the business were forced to look for new outlets and new ways of
producing these goods at lower costs. This was how the idea of structural Adjustment
policy – SAP was conceived. This policy led to the extension of some aspects of trade
and production to Africa, Asia, and Latin America. For instance, investment in Africa
mining increased from $662 million in

___________________________________ 42. G. Obiozor: No. 11 A Seminar Paper titled. “The Soviet Union and the New World Order” August 30, 1991, P.2.
28
1997. Today, there are about 200 international mining companies operating in Africa.
(Hammouda, 1999)43.
The other group of capitalists who felt that the market was saturated turned
their attention and investment more to money lending and speculation to seek rapid
profit. This led to the emergence of lending clubs in Europe and America, particularly
the London and Paris Clubs. Much of their lending between 1970 and 1990 went to
developing countries who were caught in debt net of the west. Apart from dominating
the Africa markets and increasing the debt profile of their world countries,
globalization eroded the power and sovereignty of African States.
Globalization remains a nebulous concept, both in its historical antecedents
and in finding an acceptable definition for it. Thus, until a “global” consensus on
defining the concept is attained, its understanding will continue to remain illusive and
will depend largely on the inclination and dispositions of contemporary scholars on
the subject.
Perhaps globalization could be better understood as a process rather than as a
term of art. It is a process which aims at creating global norms and values in virtually
all facets of human endeavour. The historical origin of this process is as elusive as the
concept itself. The history of the world, even before the colonial era, is replete with
the assertion of political economic, social and cultural hegemony of stronger empires
over the weaker ones. For example, the Roman and Ottoman Empires have, at one
point or the other, asserted their influence and control over vast territories across
continents. The colonial incursions into Africa and Asia were part of the design of the

___________________________________ 43. H. R. Hammouda, (1999) “Rethinking Bretton Woods from An African Perspective” CODESRIA Bulletin, No 3 and 4.
29
then emerging industrial European nations to capture and control the rest of the world
for economic and political gains. These processes could be generally considered as
part of the policies of globalization albeit in an unsystematic way. Globalization is
one of the most charged issues today, a topic of discussion in both public and private
arenas – on the website, in journals, and newspapers, at boardrooms and labour
meetings as well as in parliaments. Even on placards, bill boards and in slogans,
issues of globalization are evidently manifest. The concept is not new as there have
been previous eras of globalization44.
Indeed, scholars are not in agreement with the actual beginning of
globalization. While some tie its beginning with the first circumnavigation of the
Earth or the rise of the European – Centered world economy in the early 16th century,
others place it at the turn of the 20th century, World War 11, the Oil Crisis of the
1970s, the rise of Margaret Thatcher and Ronald Reagan or to the more recent
collapse of the Soviet Union in 198945.

___________________________________________
44. R. Greenhil and A. Pettifor, The United State as a HIPC, A Report from Jubille Research at the New Economic Foundation, April 2002, available at http:// www. Jubilee200uk.org / analysis / reports/ J+USA 7. htm. See also globalization and its impact on the full Enjoyment of All Human Rights, the United Nations Secretary General’s preliminary report, A/ 55/ 150 and Corr. Land 2. 2000 (Here in after, “UN Sec – Gen Prelim Report”) and the United Nations Development Programme, Human Development Report 1999 (New York: Oxford University Press, 1999,) P. 1 (Hereinafter “UNDP Report”) (stating that globalization is not a new phenomenon in historical terms, but that it different is today). 45. G. Mauro: “Corporate Governance and globalization: Arguments and Evidence Against Convergence,” A working paper of the Reginald H. Jones Center, the Wharton school, University of Pennsylvania. See also, Mike Kwanashie “The Concept and Process of Globalization,” CBN Economic and Financial Review, Vol36, No. 4, p 340 (asserting that in a sense, the globalization process can be dated to the late nineteenth and early twentieth centuries, during the period of imperialism conventionally dated from 1870 to 1914, when Europe raided and expanded into other parts of the world, thereby creating a more integrated world economy controlled by the metropolitan countries. The present trend of globalization, however, differs from the former in the sense that today, developing countries have the opportunity to play a more active role than in the colonization era in which their participation was quite shallow).
30
This disagreement amongst scholars on the actual origin of globalization
makes it difficult to examine its impact on the corporate governance system since one
cannot, as a result categorically determine the extent of the inroads it has made. What
is new, however, is the distinctive feature of this present era as “shrinking space,
shrinking time and disappearing borders are linking people’s lives more deeply, more
intensely, more immediately than ever before”46.
What is perhaps most distinctive about globalization is that it intensifies our
consciousness of the world as a whole, making us more aware of each other, and
perhaps more prone to be influenced by one another, although not necessarily more
like each other. Globalization as a process, however, comes in a number of forms and
by nature multifaceted, with some aspects, converging, while others are inherently
opposed to each other47. This includes the globalization of economic, political, social
and cultural values directed towards the evolution of somewhat utopian global norms
and values.
According to some writers, globalization is essentially an economic process,
fashioned and pursued by the West, and which is aimed at dominating the world
economy. This process involves the breaking down of national barriers to allow for a
borderless global market economy governed by one set of rules. Therefore, it is
posited that globalization, as earlier stated, is simply about “economic liberalization,
developing a global financial system and a transnational production system which is
based on a

__________________________
46. Opp. Cit .pg. 29. 47. “R. J. Olokaonyango and D. Udagama the Realization of Economic, Social and Cultural Right: globalization and its Impact on the Full Enjoyment of Human Rights” preliminary report submitted to the sub- commission on the promotion and protection of Human Rights (52nd session), E/CU. 4/ Sub. 2 / 2000 / 13 15th June 2000.
31
homogenized world – wide value”48. The process involves the dismantling of national
barriers to trade and market for goods, services and technology, investments and
financial capital as well as intellectual property to allow for a globally free-for-all
market opportunities. In the words of Rowan Williams: “the idea that is being
increasingly canvassed is that we are witnessing the end of the nation state, and that
the nation state is being replaced in the economically developed world by what some
called the market state”49. The multinational economic giants of the west are seen
largely as the Vanguard of economic globalization with the ability to influence both
national and international economic policies. The establishment of multilateral
economic agencies such as GATT/WTO, NAFTA and OECD is seen as an instrument
of promoting a global economy based on the liberal market theory. For the proponents
of economic globalization, it remains the only way by which the global economy
could be enhanced through competitive trade and availability of technology. The
proponents went on to argue that the concept increases choice and opportunities for
both buyers and sellers. For those who are opposed to the concept of economic
globalization however, it is simply a capitalist instrument aimed at dominating the
world economy and shifting the growth of weaker national economies50.
While the intellectual discussion on globalization is heavily tilted towards the

____________________________________
48. G. M Chukunakara: “Globalization and its impact on Human Rights” in G. M Chukunakara ed., Globalization and its Impact on Human Rights (Hong Kong:) CCA – internal Affairs, 1999); see also A. Y Seifa: Supra, note 1. 49. R. Williams, The Archbishop of Canterbury, in the BBC Richard Dimbleby lecture 2002 delivered on Thursday 19th December 2002 found at http:// www.archbishopofcanterbury.org / sermons _ speeches/ 2002 / 021219.html, Retrieved on 5/5/2008. 50. It is not within the purview of this thesis to assess the impact of economic globalization on the weaker national economies of the world. However, a preponderant portion of literature available is heavily critical of globalization as an instrument of economic domination by the west.
32
economic content of the concept and may even be considered as central, it will
however be too tapered to consider globalization asan economic process only. Either
as part of the strategy towards achieving economic globalisationor as an independent
agenda, globalisationalso involves political, social and cultural transformation in a
process generally designed to evolve common global political and cultural norms and
values51.
In order to achieve economic globalization, there is the general argument that
it is necessary to achieve the convergence of political values across the globe, which
would, in turn, propel the realization of economic integration. Political globalization,
as this process came to be known, is manifested through the speed of the “virtues” of
democracy as promoted by the western political liberalism and the internationalization
of the concept of human rights. Although, it is difficult to draw a clear line of
distinction between the economic and political processes of globalization until more
recently, the latter is ‘less global’ in acceptability, simply because nations have
always tried to maintain some distinctions in policies and human rights values. Most
countries would accept the virtues of democracy and respect for human right.
However, there have always been conflicts of human rights guaranteed by each
country. For the opponents of political globalization, weaning a local content into
these noble principles and which in number of cases may run counter to the western
liberal thoughts cannot be ignored. This ‘resistance’ has continued to remain one of
the main challenges of globalization to date.
Perhaps more than any other, the greatest challenge to globalization is its
potential to alter the socio – cultural life of peoples, either as incidental to the process

_________________________________________________

51. R. J. Olokaonyango and D. Udagama the Realization of Economic, Social and Cultural Right: globalization and its Impact on the Full Enjoyment of Human Rights” preliminary report submitted to the sub- commission on the promotion and protection of Human Rights (52nd session), E/CU. 4/ Sub. 2 / 2000 / 13 15th June 2000.
33
of economic and political globalisationor as a deliberate policy towards the
emergence of global socio-cultural and religious values. This stems from the fact that
these norms are more personal to people as their symbol of identity. People are
therefore more passionate in the protection of these rights. It may therefore be apt to
say that globalizationis not a one way process. Rather, it is a multi-faceted process
designed to alter the existing global economic, political and socio cultural balance in
favour of some ‘common’ values in these areas.
However, in spite of its popularity and wide usage, it is clearly a complex
concept with multidimensional angles.52 The deduction from the above description is
that from which ever angle globalisationis viewed it represents rising interdependence
between nations and businesses, governments and civil societies across national
borders. It entails, in effect, a “worldwide compression of space and time and the
intensification of consciousness about the human and natural world as a whole. 53
To this end, it is worthy of note that globalization process is promoted by
international institutions, which are grouped along the lines of the principals of laissez
faire market model (where high priority is given to commercial interest) and
principles of partnership (where the rights of people to development and fulfillment of
social needs are highlighted) 54.
The International institutions promoting the free market model of
globalization are the International Bank for Reconstruction and Development (IBRD,

____________________________________
52. W. James: “What is globalization,” University of Florida, globalization research center, available at http://www. Cas.usf.edu / global Research / globaldefinition.htm. retrieved on 2009/1/24. 53. Ibid. 54. K. Martin: Globalization andthe South: Some Critical Issues (Ibadan Spectrum Books Limited 2000) P. 1
34
otherwise called the World Bank), the International Monetary Fund (IMF), the World
Trade Organization (WTO) and Organization for Economic Cooperation and
Development (OECD) as well as Multinational Corporations on the other hand. The
United Nations (UN) and its agencies, International Non- Governmental
Organizations are international institutions promoting globalization on the basis of
partnership for development.
The approach of the WTO and the “Bretton Woods” institutions is the
empowerment of the market, a minimal role for the state and rapid liberalization.
These institutions wield tremendous authority in a majority of developing countries
(including Nigeria) that depend on their loans and aids.
Countries requiring debt rescheduling have to adopt Structural Adjustment
Programmes (SAPs) that are mainly drawn up in those Institutions SAPs cover
macroeconomic policies and have recently also covered social policies and structural
issues such as privatization, financial policy, corporate laws and governance.
The mechanism of making loan disbursement conditional on these policies has
pushed the indebted developing countries towards liberalization, privatization,
deregulation and a withdrawal of the state from the economic and social activities.
The new agreements under the regime of the WTO have established disciplines in
new areas that go beyond the merit of the old General Agreements on Tariffs and
Trade (GATT), including intellectual property rights, services, agriculture and trade
related investment measures. The existing agreements now require domestic
legislation and policies of member states to be altered and brought into line with
them.

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35
The approach of the free market model of globalization is streamlined by the
overriding objectives of the WTO which is to “help trade flow smoothly, freely, fairly
and predictably.” It does this by performing the following functions: 55
 Administering trade agreements;
 Acting as a forum for trade negotiations;
 Reviewing national trade policies
 Assisting developing countries in trade policy issues through assistance
and training.
The UN agencies spearheaded by the United Nations Conference on Trade and
Development (UNCTAD) on the other hand, operate under the belief that public
intervention (Internationally and Nationally) is necessary to enable basic needs and
human rights to be fulfilled and that the market alone cannot do the job and in many
cases in fact, hinders the job being done.
The first UNCTAD meeting was held at Geneva in December, 1964 Subsequent
sessions of the Conference were held in 1986 (New Delhi), 1972 (Santiago), 1976
(Nairobi), 1979 (Manila), 1983 (Belgrade), 1987 (Geneva), 1992 (Cartagena), 1996
(Geneva) and 2000 (Geneva).
The UNCTAD is the principal organ of the United Nations General Assembly
in the Field of Trade and Development. Its mandate is to promote international trade
and particularly that of the developing countries with a view to accelerating their
economic development. In line with its mandate, the functions of UNCTAD
comprise:

____________________________________
55. Article 111 of the WTO Agreement
36
(a) Policy analysis
(b) Intergovernmental deliberation
(c) Consensus building and negotiation
(d) Monitoring, implementation and follow-up
(e) Technical cooperation.

The profound changes that the world has witnessed in recent times have given rise to
a new sense of partnership for development among member states. This new sense of
partnership has pervaded UNCTAD endeavours, concerns and policy perception.
These partnerships for development are based on a firm commitment to multilaterism
involving a strengthened development dialogue and cooperation among countries, rich
and poor. Agreement was reached at the Catagena Conference on actions in the
interrelated issues regarding trade, finance, investment, services, and technology. The
commitment sets out policy recommendations with regard to relatively new concepts
in the development dialogue, which have come to the fore at the United Nations in
recent years. Those policy recommendations are “good governance” at the national
and international level for development of democratic systems based on popular
consent and accountability and the observation of human rights as a moral imperative
and as an important factor for development.
The commitment further provides guidelines to expand work in UNTAD on
sustainable development focusing on issues such as the interaction between trade
matters and environmental policies, measures to foster sound management of natural
resources, the generation and dissemination of environmentally sound technologies
and the impact of patterns of production and consumption on sustainable
development.

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37
Other conferences on related issue of development held recently by the UN
agencies include: The UN World Conferences on Environment Amsterdam (1992),
Population Span (1994), Social Development United States of America (USA) (1995),
Women Paris (1995) Habitat Sweden (1996), Genetic Resources Moscow (1996) and
Food Geneva (1996). These Conferences are much more transparent and democratic
as compared with what happens at the WTO and Bretton Woods Institutions.
In conclusion it is important to note that some economic institutions in Europe
and America also promote globalization. The following institutions and corporate
bodies are some of the leading entities that accelerate the world’s economic
growth.
1. Amsterdam – Rotterdam N.V
2. Banco Espanol de Credito Spain
3. The International Monetary Fund (IMF)
4. The World Bank
5. Bank of America (U.S.A)
6. Bank Rothschild, Paris.
7. Sveriges Kredit Bank, Sweden.
8. Narodmy Bank, Moscow
9. Deutsche Bank, Berlin.
10. Swiss Credit Geneva
11. Alliance Insurance Bank, New York
12. Lufthansa, Frankfurt
13. Bank of England, London

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14. Microsoft, USA
15. Nokia, Inc. etc.

1.3 History of Globalization
The term globalization, though new in coinage is old in terms of its
antecedents. It can be traced to the advent of the spread of the two major religions –
Christianity and Islam. These religions started from the Asian Continents and spread
to almost all parts of the world, replacing the various independent traditional or
indigenous religions of many nationalities. The religious barners of the nationalities
that allowed for the entry of these religion into their domains were removed.
After the advent of the spread of religion, the world witnessed yet another
form of globalization. This was the advent of colonialism, which started from Europe
where countries like Britain, France, Germany and Portugal, etc spread their social,
political and economic influence across the globe. This move was facilitated by
multinational corporations that came to establish trade missions in many of the
communities that later became the colonies of the corporation’s home governments.
The role of the Royal Niger Company now the United Africa Company (UAC) in
Nigeria in this regard is very informative. Just as in the case of religion, colonialism
influenced the politics and economics of the countries that were colonized.
The clamour for and resultant gain of independence by most third world
countries appeared to have re-established the political barriers that had hitherto been
broken by colonialism. This was followed, in the case of Nigeria, by an attempt to
recreate economic barriers. The result of the desire to reclaim the Nigerian economy

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39
from external influence was the introduction of the indigenization policy in the
seventies. This seeming success in reclaiming the Nigerian economy from external
influence was short lived as the reverse began to occur when the Shagari
Administration applied to the International Monetary Fund (IMF) for a loan of $ 1.2
billion. The IMF, as one of its conditionalties, required the government to divest itself
of ownership management and control of some of the enterprises it was involved in 56.
The Shagari Administration in a move to satisfy the IMF conditions set-up a
Presidential Commission on Parastatals to examine the operation of all public
parastatals with a view to determining the basis for a new funding scheme,
appropriate capital structures as well as incentive measures to enhance productivity
and general efficiency. The commission recommended that an increased role by the
private sector should be considered especially in those parastatals where security and
other sensitive aspects of public policy are not as paramount as the satisfactory
delivery of service to the people 57.
The Shagari Administration did not implement the foregoing recommendation
until it was overthrown on December 31st, 1983 by the Buhari / Idiagbon
Administration. It should be noted however that no restriction was placed on the type
of private sector recommended to have an increased role in the enterprise. The seeds
of globalization inits modern form could be said to have been shown at that time.
Owing to pressures to revamp the economy, the Buhari / Idiagbon regime set
up a study group on statutory corporations and state-owned companies to undertake

___________________________
56. Ademola O. Popoola: “W.T.O. and the Dynamics of International Trade in an era of Globalization: Grievance Redress Mechanism in Focus. “A paper presented at the RoundTable on International Trade and Globalization: Challenges for Nigeria, hosted by the Nigerian Institute of Advanced Legal Studies, in Lagos on the 18th of June 2002. 57. J. Amupitan: “Private Placement method of privatization in Nigeria” in CJ Dakas. (ed) New Vistas in Law (Jos: Faculty of Law, University of Jos, 2002), vol 2, p.342 at 343.
40
an in-depth study of the desirability or otherwise of privatization of parastatals and
state-owned companies; identify those which can be privatized and recommend the
technology of achieving such a programme in the public interest58. The study group
recommended what it termed “Selected privatization” 59. The Buhari regime could do
nothing on the study group recommendations before it was overthrown by General
Ibrahim Babangida on the 27th of August, 1985.
In the 1986 Budget speech, General Babangida announced Government’s
intention to divest her holdings in certain key sector of the Nigerian economy and
reduce her holdings in other sectors. Owing to this intention, the regime in 1988
promulgated the Privatization and Commercialization Act60, which provided the legal
framework for the privatization exercise. The Act set up the Technical Committee on
Privatization and Commercialization, which was charged with the responsibility of
implementing the Privatization Programme in Nigeria.
It was believed by the Nigerian Government as proposed by the IMF, World
Bank and other donor agencies, that privatization was the only panacea to divert the
public enterprises of a wide range of problems including misuse of monopoly power,
defective capital structure, mismanagement, corruption and nepotism61.
Successive administrations in Nigeria pursued the privatization exercise with
more vigour as the problems identified above persisted with others like poverty and
bad governance making the list. The concept of privatization is recently being given a

____________________________________
58. Federal Republic of Nigeria Report of the Presidential Commission on Parastatals, Lagos Federal Government Press 2002. 59. J. Amupitan “Article Xii” Federal Government of Nigeria, Report of the study Group on Statutory corporation and state owned companies, Lagos, Federal government press, 1984, p52 60. Ibid. 61. Privatilazation & Commercialization Act NO. 25 of 1988.
41
more market orientation than when it was seen as more transfer of ownership of any
enterprise from the public to the private sector62. This is evident in the consideration
given to the term privatization by Ramanadham V.V who states as follows:
“The term privatization essentially denotes marketisation or bringing the enterprises
under the disciplines of the market. There can be three options of policy: Ownership
Changes, Organizational Changes and Operational Changes. The second and third are
often under the name of public enterprise reform or performance improvement and
may be considered as a second-order version of privatization63.
Seen as the marketisation of enterprises, privatization looks no different from
globalization which is akin to liberalization and deregulation of national economies to
subject them to the global free market economy. Globalization is therefore a product
of privatization, as it requires the removal of the governments’ regulatory barriers to
the social- economic and political developments of the nations that embrace it. While
privatization can sometimes be restricted by regulation to the transfer of ownership of
public enterprise to the private sector within the same economy, globalization entails
that the economy is opened to the “globe”.
Globalization has become the defining process of the present age64 and is
perhaps the most widely discussed phenomenon today65. Thus third world or
developing countries are expected to globalize, and practice what is called good
governance to be able to access or attract foreign Loans, foreign investment and

____________________________________
62. OP, Cit. 63. Ibid. 64. V.V. Ramanadham: “The Economics of Public Enterprises” (London and New York: Routledge, 1991) P. 395 65. “Martinkhor: Globalization and the South”: Some Critical issues (Ibadan: Spectrum Books limited 2000) P.1.
42
foreign grants that are seen as necessary to effect their economic growth. The
government of the Federal Republic of Nigeria has made a lot of effort in fulfilling
these conditions so as to attract foreign participation in the economy, to ensure its
growth and do away with the myriad of problems that affect the country at the
moment.

1.4 The Legal Basis and Regulation of Globalization
Evidently, this new method of expanded international trade requires an
organizational base to manage its activities. GATT’s replacement needed to be a
system that took into cognizance the needs of the developing nations66. These nations
had been marginalized and in some cases excluded by previous attempts at integration
of international trade, thus impugning the very basis of global trade. The WTO was
therefore, to ensure that the developing nations were part of the new international
trading system,67 as a means of ensuring the inclusiveness and therefore integrity of
the process. The resulting WTO Agreement came into force on the 1st day of January
1995 and was signed by the existing members of the General Agreement on Trade and
Tariffs (GATT) 68. It is to cover all trade in goods and services as well as trade in
intellectual property. 69 The Agreement comprises

____________________________________
66. GATT is the Precursor to the WTO. It however lacked the status of an international organization. Its existence was based on an agreement between the contracting parties. The WTO, on the other hand is an international organization by virtue of Article V111 of the WTO Agreement. 67. Annexure to the WTO Agreement. See also Article 5 of the Declaration of the WTO to Achieving Greater Coherence in Global Policy making. 68. The Original WTO document was signed at Marvakesh. 69. This consists of the various ‘understandings’ on the interpretation of aspects of GATT, the Marrakesh Protocols, the multilateral Agreement on Trade and Goods; General Agreement on Trade in Services; Agreement on Trade Related Aspects of Intellectual Property Rights; Understanding on Dispute Settlement; the Trade Policy Review Mechanism and the Plurilateral Trade Agreements.

43
the old (1947), 70 as well as the new GATT (1994). 71 It administers various internal
agreements regulating trade among nations and facilitates the trade relations between
members. It encourages open international trade and attempts to guarantee
undisrupted international trade. It does this by ensuring that members’ trade policies
are well identified as well as in consonance with the policies of the WTO. In case it
becomes essential for a member state to change its trade policy or procedure, it is to
inform its trade partners without delay.
The sheer scope of the WTO’s activities means that there is no aspect of a
member country’s internal economy that will not be affected by its activities.
According to Eric Stein:

… Unlike other IGO’s72 competence extends across a
broad spectrum of trade and trade related activities. One
may say that in theory, there are no formal limits to the
matters on which the WTO can make rules by consensus,
particularly considering the breath of purposes listed in the
preamble to WTO agreement such as sustainable
development and higher standards of living. 73

The WTO Agreement (the Agreement) regulation pervades all aspect of
international trade.

____________________________________ 70. This is in respect of those nations with subsisting agreements under the first GATT. 71. The GATT Agreement is part of the WTO Agreement. Its members founded the WTO by signing the final Act of the Uruguay Round. 72. E. Stein, “What is globalization” Article 24 of the DSU and chapter 5 of the WTO publication, Trading into the future a key note address delivered at the 2nd International Conference on globalization/corporate governance Uruguay on 11/03/2003 P. 7 Available at http://www.cvc.nic.in/vscvc/cvcspeeches.sp19. January 2003. (Retrieved on 2009/1/24. 73. Ibid.
44
Thus it has rules on Agriculture, subsidies, environment and health regulations for the
same; other industrial products, Intellectual Property Right. Trade in services are
regulated by the Agreement as well. The agreement operates on a most favoured
Nation (MFN) basis; individual members negotiate terms of trade with each other.
The state is however allowed to impose duties on imported foreign goods.
However, any favourable terms of trade negotiates with one nation must be
extended to all other member countries. In addition, both imported and indigenously
produced goods and services are to have equal treatment within the market of the
member state on the principle of National Treatment. 74 Since international trade deals
with states as members, the issue of sovereign actions contrary to the interest of the
WTO could arise and occasion dispute. The organization recognizes that such
disputes impede world trade. The parties to such disputes have a remedy in the
Dispute Settlement Understandings procedure.75 Dispute Settlement Body (DSB) is
set up under this procedure to provide a system of settling disputes arising from trade
activities of member states under WTO Agreement or Subsidiary agreement.76
Furthermore, with respect to good governance on a global scale, sequel to the
emergence of global powers and dominance of the USA in a unipolar world , the
establishment of the International Criminal Court is expected to serve as a detterent
and regulator of the decision making process of powerful states. It is clear that leaders
who commit criminal acts of major proportions could be made to account for their
acts.

____________________________________ 74. Article XVIII of GATT. 75. E. Stein, “What is globalization” Article 24 of the DSU and chapter 5 of the WTO publication, Trading into the future a key note address delivered at the 2nd International Conference on globalization/corporate governance Uruguay on 11/03/2003 P. 7 Available at http://www.cvc.nic.in/vscvc/cvcspeeches.sp19. January 2002. 76. Ibid.
45
The International Court of Justice (ICJ) has been performing where there have
been disputes between sovereign, independent states after the establishment of the
United Nations Organization. The International Court of Justice (ICJ) is the principal
Judicial organ of the United Nations and in that capacity it has been performing a
mediating role of settling disputes between sovereign independent states. This
mediating function is enhanced by Article 94 of the United Nations Charter, which
enjoins each member of the United Nations to comply with the decision of the
International Court of Justice in any case in which it is a party. The existence of these
judicial entities ensures good governance on a global scale.

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