Building global partnerships

Ambassador of Germany to the OECD

Dr Hoffmann ©Photo: German government service

On 1 January, Germany took over the presidencies of the European Union and the G8. The last time our country had this dual-chair role was in 1999. Our basic goal this year is to address global challenges and to tap fully the opportunities of globalisation.

The interests and concerns of the EU and the G8 are by no means identical, but there are several areas where we can take the opportunity of our dual presidency to build useful synergies.
Global economy, responsibility and dialogue“Growth and Responsibility” is the theme for our G8 presidency, and enlisting the emerging economies in global governance is our watchword. After all, not only do emerging economies have a greater responsibility for resolving global issues, but their own expectation of that role is also evolving. Progress in globalisation demands a workable and dependable framework. And it demands dialogue on pressing economic questions. That is why Chancellor Angela Merkel is inviting the major emerging economies to the G8 summit in the Baltic resort of Heiligendamm this June. This is not the first time these countries have taken part in a G8 summit, but in Heiligendamm we can lay the foundation for long-term co-operation in a manner that can be pursued further in other fora. We call it the “Heiligendamm process” and the OECD can play an important role in helping the process forward.Consider the all-important economic area, for instance. We must drive home the message that market-oriented rules, together with a social concept of globalisation and a sustainable approach to resource management, are preconditions for global development and prosperity. It is in this context that we wish to come to an understanding with our partners on the core challenges facing the global economy.By stressing the positives in the world economy, we intend to set out a “G8 Agenda for Global Growth and Stability” that will chart the way forward by building on achievements so far.We will aim for a G8 declaration on freedom of investment in both industrialised countries and emerging economies in a bid to counter today’s trend towards investment protectionism. At the same time, we want to consider international investment rules that will guarantee comparable and fair conditions for foreign investors.Innovation is of central importance to our knowledge-based societies and we are particularly determined to move forward on ways to safeguard innovations from piracy and prevent violations of intellectual property rights that undermine our economies. That will involve raising our international co-operation in science and research to a new plain.Finally, for Germany and increasingly for other countries too, it is essential to bolster the social pillars of globalisation on the basis of common and universal values. This key dimension will be emphasised at Heiligendamm, where corporate social responsibility principles, including the OECD Guidelines for Multinational Enterprises, will feature prominently on the agenda.Energy security and climateG8 and OECD countries all share a huge interest in building reliable, transparent and co-operative relations with all energy users and suppliers.In December 2007, Federal Foreign Minister Frank Walter Steinmeier will host a conference in Berlin within the G8 framework, on the topic of “promoting foreign policy for secure and lasting energy supply”. One aspect of this is to diversify our energy links. As a member of the International Energy Agency (IEA), Germany already promotes open international energy markets, competition, energy efficiency, environmentally sound delivery, and further international co-operation. But we must also work together towards establishing secure structures for co-operation between the major producer, transit and consumer countries.The acceleration of global warming also poses a tremendous challenge to the world. The EU is prepared to lead the way in climate protection policy and, regardless of the outcome of international negotiations, will press ahead with structural changes towards a more energy-efficient, climate-friendly economy. Indeed, the European Council of 8-9 March 2007 has sent a strong political signal that the EU is ready to play a pioneering role in climate protection policies by cutting greenhouse gas emissions by 2020 to 20% below their 1990 levels.However, the EU can only influence some 15% of worldwide greenhouse gas emissions. To combat man-induced climate change, the Kyoto protocol must be succeeded by a comprehensive climate protection regime for the post-2012 era that will be binding on all major emitters. The EU goal is to launch treaty negotiations at the international climate conference in Bali in December 2007, and wrap them up by 2009. In the context of such an international treaty, the EU would be prepared to reduce its emissions to even 30% below 1990 levels by the year 2020.Thanks to the G8 initiative of 2005, countries such as China and India are now on board. Germany intends to build on this in the context of its dual presidency and through other partnerships.Energy efficiency is a central concern, and we see three areas with worldwide potential for savings: power generation (clean coal technology), transportation (clean cars) and construction (sustainable buildings). The IEA has established more than 40 so-called “implementing agreements” to spur the development of such technologies. Emerging economies have a growing appetite for energy too, and are now co-operating more closely through special networks of experts. Such co-operation is vital if climate policies are to succeed.Trade On trade, the focus is three-fold. First, there is the Doha round. Developed economies thrive from trade with the entire world. Though we may derive particular benefits from fast-growing emerging economies, we are obliged by our own interests and our commitments to developing countries to help ensure that the Doha round is successful.Transatlantic trade relations are the second issue. The links between the US and the EU are of course very close, but there is still much room for improvement in product standards, intellectual property, financial markets, energy and the environment. These questions are the object of Chancellor Merkel’s Transatlantic Initiative. They are also central to Foreign Minister Steinmeier’s push for an EU-US technology partnership, which concentrates mainly on facilitating transatlantic research in energy and climate change.Third, there is trade with the ACP countries–Africa, the Caribbean and the Pacific. In particular, the EU hopes to conclude negotiations under the German presidency on economic partnership agreements designed especially to promote development and integration into the world economy.Growth and governance in AfricaAnother focus of the German presidency is Africa, in whose future we reaffirm our confidence. We intend to press ahead on the G8 reform partnership with Africa, and part of that job is to place greater emphasis on the responsibility of African countries themselves. We must provide further support for reform, especially among the reform-minded countries of the New Partnership for Africa’s Development (NEPAD) initiative. We want to reinforce the foundations of good governance, and help democracy and the rule of law take deeper root. Such are the preconditions for building an efficient administration and effective education, health, taxation and social security systems.The G8 has backed its partnership with Africa by providing multilateral debt relief and additional official resources, as demonstrated at the 1999 Cologne Summit and at the 2005 Gleneagles Summit, for instance. But official funding alone will not be enough to achieve the UN Millennium Development Goals. An important task must also be to stimulate private sector growth. That means improving investment conditions by developing infrastructure, introducing appropriate financial instruments, and fighting corruption.Our EU presidency is also working hard to build a partnership for securing the future of Africa’s energy resources. The aim is to ensure that resource wealth and raw materials markets are harnessed responsibly, efficiently and transparently as part of promoting development and overcoming poverty. The EU-Africa Summit at the end of 2007 should produce agreement on a common strategy to this effect, and preparations for that event are already in full swing under the German presidency.In short, we must all strive to give political direction to globalisation. We must make it sustainable and fair economically, ecologically and socially. And we must draw the emerging economies in more closely as responsible stakeholders in global governance on the economic and political fronts. In its 2007 dual presidency, Germany is determined to do justice to the special responsibility the EU and the G8 have in laying a dependable and workable framework for the future of the world economy.
For more on Germany’s presidency of the EU, visit: www.eu2007.deFor more on the G8 presidency, visit: www.g-8.de ©OECD Observer, N°261, May 2007


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