In Search of Policy Coherence: Aligning OECD Infrastructure Advice with Sustainable Development

In Search of Policy Coherence: Aligning OECD Infrastructure Advice with Sustainable Development

Jun 09, 2016 by Waleria Schuele, Motoko Aizawa
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On December 1st of this year, Germany will take over the presidency of the Group of the 20 (G20) and host the G20 Leaders’ Summit in July 2017 in Hamburg. Strategic leadership of the G20 is required to steer the world community toward a sustainable future.

The Group of Twenty (G20) has called upon the Organisation for Economic Cooperation and Development (OECD) to undertake extensive policy analysis and recommendations relative to a wide array of issues, including infrastructure development. The Group views massive investment in infrastructure (e.g., energy, transportation, water) as a prerequisite to boosting growth and advancing job creation and development.

In a continuing effort to foster coherence among economic, social and environmental policies, the Heinrich Böll Foundation engaged the Institute for Human Rights and Business (IHRB) to review key OECD deliverables to the G20 as they relate to infrastructure investment.

2015 gave much needed boost to multilateralism as a way to debate and reach consensus on policy platforms that respond to systemic global challenges. These platforms include the Addis Ababa Action Agenda of the Third International Conference on Financing for Development (July 2015); the UN Sustainable Development Summit (September 2015) which adopted the Sustainable Development Goals (SDGs); and the UN Framework Convention on Climate Change’s Conference (December 2015), which adopted the Paris Climate Accord.

Each event not only played an important role in restoring multilateralism, but also set forth ways that nations must individually and collectively implement actions that will achieve universal sustainable development and environmental goals and commitments in the years ahead. For instance, the world community set targets to limit global warming to 2 degrees centigrade over pre-industrial levels. Now, countries must act to implement the two degrees commitment – or, better yet, one and a half degrees.

The OECD, as an organization that advises countries on their investment and development policies, has a solemn obligation to ensure that its advice is consistent with these global commitments. Through its interactions with its members and, more recently, the G20 countries, the OECD occupies a particular position of trust and prestige in the landscape of global economic governance. At the same time, the OECD is not an institution with universal membership. Its 34 member countries are part of the consensus of the UN’s 193 member countries. And while the OECD members include the most advanced countries in the world, its advice must also be relevant to the 8 G20 member countries that are not full OECD members.

The Heinrich Böll Foundation calls on the OECD to use its political clout to demonstrate full policy coherence for investment in sustainable development. The OECD has a privileged relationship with the G20 and a powerful voice on policy related to infrastructure investment and development. We also call on all G20 Leaders, not only as members and adherents of the multilateral consensus, but also as the dominant actors in powerful national and multilateral development banks, to align infrastructure with sustainable development.

To achieve effectiveness, the OECD and its Members must shatter the wall that divides financial and economic decisions from sustainable development considerations. It is crucial that Germany, which follows China as the next President of the G20, provide leadership to this end. Working with more universal institutions, the OECD and the G20 must take action to implement the multilateral consensus on sustainable development and climate goals, and lead the world by example.

 

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