Sweden Meets Australia in Race to Lead Rich World’s Thinktank
A former European Union trade chief is facing off against a former Australian finance minister in the final leg of the race to head the OECD, a prize that will see the winner address global challenges including digital taxation and pandemic recovery plans.
Sweden’s Cecilia Malmstrom and Australia’s Mathias Cormann are the last two candidates in the months-long battle to be secretary-general of the Paris-based Organization for Economic Cooperation and Development.
Delegates are currently evenly split between the two hopefuls, according to people familiar with the negotiations. Deliberations by ambassadors to the OECD this week failed to identify a winner, forcing them to try for a conclusion later this month.
The view of the U.S., the biggest contributor to the institution’s budget, is likely to be crucial.
Initially created in 1948 to run the Marshall Plan to reconstruct post-war Europe, the OECD is closely engaged in offering solutions to intractable international economic problems. Currently that includes the Transatlantic dispute over how to tax multinational technology giants such as Alphabet Inc. and Facebook Inc.
The political jockeying for a successor to Mexico’s Angel Gurria -- after a decade and a half in the role -- has already seen candidates including BlackRock Inc.’s Philipp Hildebrand and former European Commissioner Anna Diamantopoulou fall by the wayside. Here’s a look at the finalists.
Stockholm-born Malmstrom, 52, was always considered a frontrunner in the race, and would be the first woman to hold the office and the first European in a quarter of a century.
She brings a track record as EU trade commissioner from 2014 to 2019 that includes landmark agreements with Canada, Japan and South Ameican trade bloc Mercosur.
That role also made for a tense relationship with the U.S. though. She defended free trade in the face of President Donald Trump’s protectionism, telling the U.S. and China that they should cooperate to help make the beleaguered World Trade Organization “fit for purpose for the modern economy.”
Whether the new president will support her is unclear. Malmstrom told Bloomberg Television this month that she has backing from European and extra-European countries, but on the Biden administration’s stance said “I don’t know.”
In the same interview, she flagged the environment as a prime area where international institutions such as the OECD can play a key role. She also said the new secretary general “absolutely” needs a sterling record on climate change -- a sign that she’s sees that as an area where she may have an edge over her rival.
Cormann, 50, has marketed himself as a candidate who can be a bridge between Europe and the Asia-Pacific. He was born in a German-speaking community in Belgium and grew up in Europe before moving to Australia as a young man.
He still speaks in a staccato-like English that resembles the Teutonic sound of Arnold Schwarzenegger’s terminator, leading to him being labeled as the Corminator.
His political deftness has shown through in his ability to stay on the right side of three conservative Australian prime ministers with contrasting outlooks.
The last change of leadership may have tarnished him though. As a Christian conservative, he inhabited the powerful right-wing faction of the Liberal party. He is pro-market, pro-small government, opposed same-sex marriage and -- from opposition -- tore into Labor’s efforts to combat climate change with a carbon tax.
A number of climate scientists published an open letter this month saying Cormann’s public record on climate change should preclude him from the OECD post.
Still, his pragmatism showed when he went on to vote for same-sex marriage after the electorate backed it in a plebiscite, and he’s now trying to burnish his green credentials. In a Bloomberg Television interview, he said he would “deploy every policy and analytical capability of the OECD to help countries around the world reach zero net emissions by 2050.”
He’s a potential compromise candidate who may appeal to the U.S., coming from a nation that tries to combine the best of freewheeling capitalism with a social safety net to limit inequality.
©2021 Bloomberg L.P.