GENEVA - Prime Minister Dr Mahathir Mohamad lashed out at the role played by multinational corporations and big countries in globalisation today, saying they sought to dominate and control small, independent states.

In a keynote speech to the International Labour Organisation's (ILO) annual assembly, Mahathir said they were touting the free flow of capital "as the sole essence of globalisation".

"Globalisation is presently interpreted simply and exclusively as the freedom of capital to go anywhere to cross and recross borders at will," he told the assembly of workers, employers and government delegates from 175 countries.

But he warned that while poor countries were promised riches from the inflow of capital, they were not aware of the dangers of the "free outflow of capital" when investments were withdrawn suddenly.

Mahathir, who is also the finance minister, said he supported globalisation, but so far it had created a situation where "today some countries are filthy rich and some are church-mouse poor".

"What we are seeing is the erosion of the independence of countries and their further impoverishment."

"What we are seeing is the feverish acquisition and mergers of the banks and corporations in the powerful economies so as to become even more powerful," Mahathir added.

In 1997, Malaysia suffered harshly in the Asian economic crisis, which Mahathir has repeatedly blamed on currency traders and international financial markets.

Attempts to manipulate

"I'm not against big corporations investing in poor countries, obviously that will bring in wealth and create jobs," Mahathir later told journalists

"What I worry about is this desire to become very big ... and that will lead to attempts to manipulate governments of poor countries because corporations are very rich," he added, casting doubt over the social concerns of "globe-straddling giants".

Growth needed to be about the "well-being of everyone in human society, then and only then will globalisation be meaningful to the world at large," he noted.

Mahathir was also critical of the the Group of Eight (G8) industrial nations, who are due to meet in Canada on June 26 and 27.

"For some countries to take it upon themselves to determine how the world should function simply because they are strong I think is a negation of a very democratic principles that they preach," the prime minister said.

The World Trade Organisation (WTO) was criticised for "the tendency to pressure weak countries into accepting policies and market systems which are not good for them".

Earlier this month, Mahathir noted that Malaysia's economic recovery was assisted by growing confidence shown by foreign investors, especially from the United States, to be active again in international trade.