Former Australian finance minister secures top OECD position

Mathias Cormann defeated former Swedish European Union trade commissioner, Cecilia Malmström, in the final ballot

Following an intense international political battle running over many months and a government-backed campaign, former Australian Liberal finance minister Mathias Cormann last week secured the position of secretary-general of the Organisation for Economic Co-operation and Development (OECD).

Cormann won his selection when he defeated the last remaining candidate for the post, former Swedish European Union trade commissioner, Cecilia Malmström, in the final ballot.

Besides the considerable effort devoted to his campaign by the Australian Liberal-National Coalition government, backed by the opposition Labor party, the main factor in Cormann’s success was the support he received from both the Biden administration in the US and the Johnson government in the UK.

Both governments supported Cormann amid strident criticisms of his record on climate change as a member of successive Liberal Coalition governments from 2013 to 2020 when he quit parliament.

While the back-room negotiations, conflicts and deals are not in the public domain, it is likely that one of the key factors in the US decision not to endorse the EU candidate was its concern that the head of the OECD should be closely aligned with attempts to organise a push against China.

There was considerable annoyance in the Biden team over the EU decision late last year to go ahead with an investment agreement with China before the new US administration took office.

Officially, the UK maintained that it had a strictly neutral position since the British ambassador to the OECD was the chair of the selection process. But according to a report in the Guardian last week, there had been “strong suggestions from within the OECD secretariat” that Boris Johnson told Australian Prime Minister Scott Morrison that Cormann had the UK’s backing, in a call between the two on October 27.

The significance of the China question is indicated in remarks by Cormann both before and after his appointment.

In his campaign material he said that “strategic competition in the [Asia-Pacific] region” was having global consequences. While it was “in everyone’s interests to have the best possible relationship with China, we also have to be clear-eyed about some of the pressure points to be worked through.”

In his remarks on receiving the appointment, Cormann became more explicit. He said it was a “privilege and honour” to head the OECD because it provided a great platform for international co-operation “from the foundation of a shared commitment to democracy, human rights, the rule of law, market-based principles and a rules-based international order.”