physical and technological infrastructure, an educated and ambitious population and we are fortunate to be close neighbours of the USA, the sole superpower which has the largest and strongest economy in the world.

The new global economy presents the opportunity to spread more widely the benefits of economic growth. We, therefore, should do nothing to impede it.

Bermuda's overall economic success bears eloquent testimony to the benefits of economic integration. International business is a very large part of this economic success. But the message here is that we either accommodate them in the new order of globalisation -- or they will go elsewhere.

If they go elsewhere it would lead to the demise of the Bermuda we have placed so much pride in. It would further erode tourism and create widespread unemployment which would compound our social problems.

Good government is synonomous with democracy, which is based on the rule of law, market economics and political pluralism. Democracy is broadly acknowledged as the best form of governance ever devised. But is there anything human without fault? Good government, the rule of law and market economics transformed Bermuda, which was largely an undeveloped, rural, agricultural community in the immediate post-World War Two years, into one of the most successful countries in the world.

Successful market economics paid for a general improvement in the overall quality of life. The range and quality of social services, education and the physical and communications infrastructures expanded dramatically. Educational standards and opportunities soared and a high percentage of young men and women have college or university degrees. In the last 35 years, in particular, there has been a real social resolution.

Social and economic progress helped to reinforce the stability of the community. If this social and economic progress is to continue it is of paramount importance that we face up boldly to the new global reality.

You cannot pick up a newspaper or magazine or turn on the radio or TV without hearing someone mention "the global economy'' and how it is affecting our lives. Who would not agree that the world we are now living in is a very different place from what it was ten years ago? When people talk about the "global economy'' today, they are usually referring to the increased interdependence of national economies and how this process is facilitated by capital and commerce, telecommunications and technology.

One of the most widely discussed features of globalisation is economic integration. Barriers to trade and investment are disappearing. Borders are becoming less relevant. Goods, services and capital flow around the world, making countries truly interdependent.

Economic interdependence increases the incentive for countries to work together constructively. It raises the cost of arbitrary and autocratic behaviour. Governments may try to control the mass media but they cannot stop individuals from using the Internet.

One of the most powerful tools driving the borderless economy is the Internet.

According to The Economist, a three-minute call (in 1996 dollars) between New York and London cost $300 in 1930. Today the same call is almost free through the Internet. More than 300 million Internet users around the world can share information as quickly and as easily as neighbours did when most of us we were growing up. Think about this one fact: most people had never heard of the Internet in 1990 -- even fewer had e-mail addresses then. But today the Internet, cell phones and e-mail have become so essential that many people cannot imagine living without them.

The unprecedented integration of finance, technology and information is driving change across the globe at an ever-increasing speed. These technologies are making it possible for countries, corporations and individuals to reach further, faster, cheaper and deeper at a pace never before seen in human history.

This process has not been unfolding because governments decided it should.

Globalisation has been driven by a wave of technological change that has reshaped communications and transportation. The speed and low cost of moving goods, services, money and information have virtually eliminated distance as an economic factor.

Economic globalisation involves arguably the most fundamental redesign of the world's political and economic arrangements since at least the Industrial Revolution.

Yet the profound implications of these fundamental changes have barely been exposed to serious scrutiny or debate. Despite the scale of global reordering, neither our elected officials nor our educational institutions nor the mass media have made credible efforts to describe what is being formulated or to explain its root philosophies.

We must communicate the benefits of globalisation more effectively.

Many will see the evolving economy as a threat rather than an opportunity. The greatest pressures from globalisation are falling on low-wage and low-skill workers. The people most vulnerable are precisely those with the fewest tools to adapt. We must, therefore, prepare Bermudians through education and training so that they can take full advantage of this new economic order.

We must approach the challenges of globalisation and economic integration as opportunities and not fear them as threats to our well-being. We did not start globalisation. We can't stop it -- and we'd only be wasting our time if we tried. Globalisation shapes virtually every country's domestic policies and international relations.

This poses special challenges for Bermuda's Government and society as a whole.

We do have a responsibility to maintain the momentum towards global economic integration. It is the basis of long-term growth and increased prosperity, not only for us but also throughout the world.

But we can only take advantage of these emerging economic opportunities if Government is prepared to address the anxieties that accompany change. How? First, Government must work to ensure that all our citizens are equipped to reap the benefits of the new economy; to develop the tools to take advantage of the opportunities that changing the economy provides.

The Government should set priorities that strengthen the foundations for long-term economic growth and job creation. We must continue to invest in education, job training, health and the future of our children. But we cannot lose sight of those who are less able to compete.

A strong economy must be built on a strong society. No less eminent a free marketeer than George Soros recently wrote -- and I quote -- that "the survival of the fittest is not the basis on which to build a civilised society''. We must support the most vulnerable among us.

I want to stress that globalisation is not only about economics. It has enormous implications for democratisation and international relations.

Globalisation has four fundamental elements.

1). The democratisation of government (how we govern).

2). The democratisation of technology (how we communicate).

3). The democratisation of finance (how we invest).

4). The democratisation of information (how we learn).

The Democratisation of Government Democracy is acknowledged to be the best form of governance ever devised.

Essential elements of democracy are the rule of law, personal freedom, transparency, openness, market economics and political pluralism -- together with compromise and consensus. Arbitrary and autocratic behavior are the enemies of democracy. The new global economy makes it essential for governments to consult very meaningfully with non-governmental organisations both locally and internationally.

The Democratisation of Technology The innovations of computerisation, miniaturisation, telecommunication and digitisation have made it possible for hundreds of millions of people around the world to get connected and exchange news, information, knowledge, money, family photos, music, videos in a way -- and to a degree -- never witnessed before. These exchanges are instantaneous.

The Democratisation of Finance The democratisation of technology helped foster the third major change driving globalisation -- and that is the change in how we invest.

Technology opens doors for all kinds of companies and individuals who never had access to cash before to raise money. Thanks to the democratisation of finance we have gone from a world in which a few bankers held the sovereign debts of a few countries to a world today in which many individuals -- through pension funds and mutual funds -- hold the sovereign debts of many countries.

The Democratisation of Information: Thanks to satellite dishes, the Internet and television, we are able to see, hear and look at events around the world as they happen.

The democratisation of information is also transforming financial markets. Not only can investors now buy and sell stocks and bonds from all over the world from their home computers, but Internet brokerage sites are now giving them -- for free -- the information and analytical tools to make these trades without even having to call a broker.

At both the corporate and government levels, the democratisation of technology, finance and information are capable of creating amazing new efficiencies and economies of scale in the marketplace as well as a whole new place to do business called cyberspace.

This process has also lowered the cost of entry into almost any business. With a simple personal computer, credit card, phone line, modem, colour printer, Internet link and Federal Express delivery account, anyone can sit in their kitchen and living room and start his or her own business. This has the effect of grealy increasing competition and the speed by which a product moves from being an innovation to being a commodity.

These changes in techonology, information and finance are a democratising force that gives power to the individual and permits a wider and further dissemination of information.

It is worth repeating -- the new global economy presents the opportunity to spread more widely the benefits of economic growth. We, therefore, should do nothing to impede it.

Borderless world: Former Premier Sir John Swan