Gordon Brown says he is "evangelical" about globalisation, but warned that the UK must raise skills levels to exploit economic changes.
Business support is crucial to Gordon Brown
Addressing the CBI conference, the UK chancellor condemned protectionism and said he wanted the UK to become a great "globalisation success story".
Improved infrastructure, skills and entrepreneurship were key to competing against China and India, he stressed.
Mr Brown also pledged to keep public sector pay rises "under control".
Ahead of next Wednesday's pre-Budget report - widely expected to be his last as Chancellor - Mr Brown said public sector pay settlements must be linked to the government's 2% inflation target.
Mr Brown's desire for wage restraint could put him in conflict with leading unions, which have complained about members having to accept inflation-linked rises while executive pay continues to soar.
Inflation is currently running above the government's target, prompting the Bank of England to raise interest rates last month.
"We will entrench our stability, keep public sector pay under control, maintain discipline in public finances and my watchword will be stability now, tomorrow and into the future," Mr Brown said.
The Chancellor called for a "worldwide campaign" to spread a positive message about globalisation and its economic benefits.
He was backed by US Treasury Secretary Henry Paulson, also attending the conference, who expressed concerns about a rising tide of protectionism in a number of leading markets.
"Giving in to protectionist sentiment would send a terrible signal," Mr Paulson said.
The UK is well placed to cope with the challenge posed by the rapid growth of China and India, Mr Brown said, but must remain competitive in areas such as regulation and infrastructure.
"There is a real question about what is the destiny of Britain in a world where globalisation means you can buy almost any service anywhere," he said.
"My passion is that Britain will become the great globalisation success story of this century."