The OECD is holding its annual talking shop before tomorrow’s get together of the ministers in charge of the world’s leading economies (or rather the old world’s leading economies – China, Russia, and India are not members). The theme is the post-crisis recovery and “jobs, innovation and clean growth”. The OECD’s bold leadership in keeping alive the bigger debates of the crisis is to be applauded, but this respected institution is still struggling to overcome its “rich club” tag.
As the offspring of the Marshall Plan (that last big attempt to rescue the global economy) the OECD has taken a welcome role in leading debates about what our economies should be for (developing new indicators of progress under the leadership of Amartya Sen and Joseph Stiglitz, among others), how our economies should be run (asking questions about the future of capitalism for example as part of this forum) and encouraging governments to see joined up challenges, but also opportunities, in the concurrent crises of the economy and climate (helping to develop strategies for green jobs).
But an understanding of the particular needs and circumstances of the poorest countries has been sadly lacking in the debates over these last two days.
Take the topic of innovation. Innovation is important – it’s not simply a way out of the crisis and rebuilding more forward-looking economies, it’s the way that we will deal with new (and old) challenges that we face, climate change, disease, even poverty.
How OECD countries develop strategies around innovation is also important. If rich countries only focus on how to develop their own industries, and how to export these to poorer ones through trade, investment and even aid, then the risk is that those poor countries will be left behind in the new economy as much as in the old one, and that technological solutions are innappropriate or fail to reach poor people that need them.
Good solutions to promote green innovation and investment were proposed yesterday – the role of consumers in demanding cleaner goods and services, and of governments in providing regulatory controls, tax incentives and subsidies. These will help our economies become greener and to lesson our contribution to climate change. But these solutions will not be the right ones for developing countries. Poor people have a need for clean technology, but not a “demand”in the economic sense, as their inability to pay means consumer-led market solutions are not likely to be forthcoming in developing countries. Their governments often lack the leverage or fiscal capacity to use regulation or tax breaks and subisidies. Developing countries need a tailored policy framework that will allow them, not only to import or even be given green technology from OECD countries, but to develop their own, more appropriate solutions, and to structure their markets so that green growth can contribute to poverty eradication.
The OECD has shown bold willing in asking the big questions, perhaps new partnerships with civil society, non-OECD countries and other post-crisis processes at the United Nations are the next step.