Angel Gurria, the OECD Secretary General, was interviewed on The 7.30 Report last night. Some of that is worth indexing here as a touchstone for our current debate.
KERRY O’BRIEN, PRESENTER: Given the economic balls the Rudd Government is juggling at present, high interest rates, high petrol prices, a slowing economy but with stubbornly high inflation, coupled with what Treasurer Wayne Swan describes as the most difficult global conditions in 25 years, they too would have breathed a sigh of relief after the Reserve Bank statement today. But even if interest rates do start dropping again soon, there’s a distinct lack of confidence from all quarters about when the international economy might turn the corner. Even the most confident of experts is now hesitant to predict an end to the damaging global credit crunch flowing from the US sub-prime debacle. Even the boss of one of the world’s most influential economic agencies, the OECD, acknowledges these are uncharted waters, but says Australia is better placed than most to ride out the storm. Angel Gurria, Secretary-General of the OECD, is in Australia for an APEC conference, and I spoke with him in our Melbourne studio…
KERRY O’BRIEN: Is there a risk the global slowdown may derail for the moment at least a concerted effort to tackle climate change?
ANGEL GURRIA: It should not, and we are very strongly saying to leaders they must not let that happen. The climate change challenge is the most important long term challenge facing man kind today. We should not be distracted. We are talking about 2008/2009. Well, in terms of climate change, we are thinking about the end of 2009. We are going to have the arrangement in Copenhagen which will probably be the seed of the post Kyoto arrangement, you know, the post Kyoto architecture. So this is for 2020, for 2030, for 2050 on climate change. We should not let the things of the next six months or the next 18 months distract us from the very, very critical issue of climate change.
KERRY O’BRIEN: Does a moderate sized country like Australia really have the capacity to influence the major emitters in terms of reducing emissions, and coming on board to substantial targets?
ANGEL GURRIA: Absolutely yes. Australia is already leading. It’s an example, we are looking at it and how it will be dealing with its proposed legislation. Australia is also a very big exporter of raw materials, including coal, and, therefore, you know, it has to set the example. And it’s 2 per cent of the emissions, yes, but at the same time it’s larger in terms of emissions that most of the countries in the world and it is part and parcel of an organisation like the OECD, part and parcel now of Kyoto because it recently ratified. So Australia has a lot to contribute to this process. So keep at it.
KERRY O’BRIEN: You would be well aware of the argument that a developed country like Australia can’t afford to get ahead of the pack in reducing carbon emission levels while the big polluters like China, India and America drag the chain. That Australia’s economy would surrender competitive trade advantage in the process. Do you have sympathy for the argument?
ANGEL GURRIA: I have no sympathy for the argument. I actually believe the contrary is true. That by seeking, by leading, you get first mover opportunities. There’s a development of a whole industry of green business to be done, and last but not least, in the end we all are going to have to contribute to the solution, so the sooner one gets into that mode, the better. The sooner the new type of economy, the new type of production that we are going to need in order to face this world with less carbon or at least 20 per cent or 50 per cent or whatever less carbon than we are emitting today, then the better. So, again, first movers will have the advantage and Australia will enjoy that.
On Sunday I put some ideas to Sirdan over a red wine at The Carrington, and to my surprise he agreed. What I said was that the politicians really amaze me. Without being party political about it, it strikes me that they take far more credit — or assign far too much blame — for what is happening. For example, surely it is obvious that what we are facing now was building up long before Kevin Rudd became Prime Minister. Wouldn’t it really be the case that John Howard, Peter Costello, Brendan Nelson, and Malcolm Turnbull must be thanking God daily that they are not in government at the moment? So easy to sit on the sidelines and carp, isn’t it. Would things have been substantially different if Howard had been re-elected, and Peter Costello was perhaps by now Prime Minister? Does anyone seriously think they would be?
I will leave it at that, except to note that the longer perspective Angel Gurria offered is more truthful:
KERRY O’BRIEN: Australia’s Treasurer Wayne Swan said today that this represents the most difficult global conditions for more than 25 years. Do you agree with that?
ANGEL GURRIA: I agree we are facing unprecedented and as you yourself said, uncharted situations. But Australia is well prepared, because Australia worked on its reforms, has been doing so now for the better part of two decades, and today it can face the music better. It’s stronger, it’s well prepared, it has no debt that is pulling it down, and it’s also doing better in terms of its fiscal situation, it’s reforming also in terms of things like the climate change legislation that is before your Parliament, so in general I would say you are better prepared, but it doesn’t mean that you are immune.
You count back twenty years and where do you get? Exactly… Wouldn’t it be nice if we could engage a little more, rather than playing political ping-pong?