Panaji, Feb 4 (IANS): The vagaries of a globalised economy are working at the very roots of a democratic form of government, former Greek prime minister George Papandreou said, adding that in the present day and age, a fiscal rating agency had emerged more powerful than a nation.

Papandreou was speaking on the subject of "intercultural dialogue for humanising globalisation" during the ninth edition of the D.D. Kosambi festival of ideas currently underway in Goa.

"There is a fundamental question when we are talking about democracy in a globalising world. Can democracy work in a globalised economy when forces beyond our nation can determine our fate? This is not an abstract philosophical question. It is a defining question of our times with stark economic political and economic," Papandreou said while summing up the angst of the Mediterranean country, which battling bankruptcy and his experience at the helm while fighting the economic crisis.

"I was facing a huge challenge. The markets were going crazy because Greece was seen as possible default. We could not borrow easily. My conclusion was that we could do a lot in Greece but we could not deal with these markets if we did not work together in Europe.... give a strong message to the global markets that we can handle this crisis," he said.

German Chancellor Angela Merkel, he said, was positive about a Greek revival, but it was market mechanisms worked against Greek interests.

"But despite Greece's democratic commitment to tackling this crisis, soon the markets began to mistrust us again. We were forced then to go to a special bailout mechanism which Europe then created," the former Greek premier said.

"A rating agency today is much more powerful that an individual state and a nation. If it changes a country's rating and a whole lot of wealth moves out of the country," he further added.

Along with democracy, Papandreou said that concepts like nationalism were an illusion in time of globalisation and governance systems across the world needed to adapt and grasp opportunities collectively.

"Nationalism is an illusion in a time of globalisation. And Europe needs to become an example of politics, a democratic politics beyond borders. Of course there are margins for manoeuvre for local government and nations in a globalised world even more opportunities," he said.

"We are confined by borders that have no relevance to the real world challenges of today. We have become a highly interdependent and global society and global issues beg for cooperation if they are to be addressed in a meaningful way."

"We have to reclaim our democracies especially when lobbies are stronger than citizens, the world's richest 62 families who own half the world's wealth can buy out almost any government, media house, judges, politicians, barring a few exception," he added.