Economic development requires the transformation of institutions as well as the freeing of prices, which in turn requires
political and social modernization as well as economic reform. The state plays a key role in this process; without it, developmental strategies have little hope of succeeding. The developing countries that have gained the most from integrating into the world economy have shown impressive gains in their investments. Developing countries can make a vital contribution through effective domestic policies in conjunction with
international efforts to ensure sustainable growth and development: Improved investment climate in developing countries will encourage investments and creation of jobs but this requires good economic governance and measures to combat corruption. The sincere and better-functioning bureaucracies, better regulation, good contract enforcement, sufficient provision of social protection to a changing labor markets, and structural reform will much encourage domestic competition; Improved delivery of education and health services are global new deal. This will then give a breathe to a new life into most of the world’s ailing economies. For
globalization to become a win-win situation, rules, regulations, and international conventions must count as much as market mechanism. There can be sufficient interaction on the four concepts of globalization like: technological innovation; trade liberalization; internationalization of capital; and the new international economic order when there is an effective international rules and legal system that protects labor, environment, and monopolistic practices, otherwise globalization can lead to oppression, exploitation, and impoverishment. Therefore less developed countries must have to be vigilant in these matters. ******