PROFESSOR JOSEPH STIGLITZ came out to the 32nd Sir Winston Scott Memorial Lecture with economic guns blazing, in defence of developing countries disadvantaged in trade with the developed world.

In his lecture on Making Globalisation Work For Developing Countries last Monday at Frank Collymore Hall he said money was supposed to go from the rich to the poor, but in the modern world of globalisation this was reversed.

"Last year more than half a trillion dollars went from poor countries to the rich. The richest country in the world, the United States, borrowed US$850 billion . . . from countries that were poor.

"The richest country in the world could not live within its means yet it lectured other countries about fiscal prudence," Stiglitz asserted.

The 2001 winner of the Nobel Prize in economics pointed out that trade agreements were often a poverty vice for poor nations.

"Developing countries have not shared in the gains of the last round of trade agreements that was completed in 1993, signed in 1994. It was so unfair that the poorest countries of the world were actually worse off," said the former World Bank chief economist.

He noted that poor nations also lost out at the World Trade Organisation's 2001 Doha Development Round of negotiations, intended to lower trade barriers around the world, because Europe and the United States have reneged on promises they had made there.

He said that focusing trade agreements on capital investment instead of labour further diminishes the security of developing countries.

"If a country threatens to tax capital, to enforce environmental regulations, to enforce worker conditions, capital investors can say we'll go someplace else where taxes are lower, where regulations are weaker. . . ", Stiglitz said, but developing countries could stem their "race to the bottom" by building on dynamic comparative advantage – current strengths backed by investment.

"Take advantage of the changing global landscape, changing global technology, geopolitics and global prices," Stiglitz said, adding that if countries "succeed, they will be able to make inroads into major problems that they face."