China question

Readers' views No 254, March 2006
OECD Observer

Secretary-General Donald Johnston understandably raises the question of the OECD’s future relationship with China (No 251, September 2005). But as well as focusing on China itself, both in your edition and in your organisation’s impressive work on the country, what about China’s presence in the global economy generally?

Apart from investing in OECD countries, as one of the world’s largest energy consumers, China is active in the Middle East and Latin America. In Africa, it has major interests in oil and other extractive industries, notably in Sudan and lately Angola, where its influence as a trading force, investor and aid donor seems to be growing. How China’s economic influence will evolve globally is a key question.

Joseph Deng
Paris, France

Ángel Gurría of Mexico is soon to succeed Canada’s Donald Johnston as head of the OECD (No. 252/253, November 2005). It’s the first time that a man from a not-so-rich if not-too-poor country will head an organisation frequently described as the “rich man’s club”. Mr Gurría’s appointment is a tribute to his strong international reputation and the OECD’s desire to change with the times. Mr Gurría says of his own admission that a grouping which once represented threequarters of the world’s wealth is now worth about 60%.

Put simply, non-OECD countries such as China, India and Brazil are taking the world by storm, posing an inevitable question that still seems to cause more serious discomfort than debate–can the OECD and other international economic organisations remain legitimate representatives of a global economy that no longer owes its growth to a privileged few?

By its own account, China is now probably the world’s fourth biggest economy. It is only a matter of decades before India has more people than the most populous country in the world. Brazil is fast becoming the world’s food wholesaler.

None of these countries is in the OECD. What’s the difference between them? China is still ruled by the Communist Party. Which begs question: Will the OECD’s members extend a hand in the belief that it is better to have China within than without? After all, some countries have joined the OECD in the past without fully meeting the OECD requirements associated with market economies–that procedure was seen by many as the way to ensure that those requirements were one day met.

Another difficult question would have to be asked. Does China want the OECD?

Brian Love
European Economics Correspondent, Reuters

©OECD Observer No 254, March 2006

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