Klaus Rohland: Development is a comprehensive project
CSST: As one of leading international organizations, what roles does the World Bank play at the current moment? What is its mission in China?
Klaus Rohland: International organizations are owned by the countries of the world. The World Bank has 188 members. We represent the interests of all member countries and we have an international perspective. One of the dangers of periods of economic downturn, or at least insufficient economic growth, is that people turn to policies that focus very narrowly on national interests. A country like China depends, to a large degree, on free trade for economic growth. It’s incredibly important that the benefits of globalization be secured against protectionism; this is very much the role international organizations can play. Since international organizations are not based on national interests, they are able to represent the interest of the world at large. If you ask me, the role of World Bank is even more important today.
Klaus Rohland: International organizations are owned by the countries of the world. The World Bank has 188 members. We represent the interests of all member countries and we have an international perspective. One of the dangers of periods of economic downturn, or at least insufficient economic growth, is that people turn to policies that focus very narrowly on national interests. A country like China depends, to a large degree, on free trade for economic growth. It’s incredibly important that the benefits of globalization be secured against protectionism; this is very much the role international organizations can play. Since international organizations are not based on national interests, they are able to represent the interest of the world at large. If you ask me, the role of World Bank is even more important today.
Our mission in China is reducing poverty and increasing prosperity and harmony. This is the overarching umbrella under which we work. China’s poverty reduction has been one of the major successes of mankind. In 1980, 850 million people in China lived under 1.25 dollars a day, but that number has been reduced to 150 million. The world at large is meeting the UN Millennium Development Goals (MDGs) -- poverty in year of 2015 should be half of that in 2000. This goal is going to be met in large part because of China, though that’s not to say it won’t still be a challenge.
Most of our projects are implemented in the provinces. The World Bank has huge interests in working in China. We tend to do 50-60 new projects per year, but sometimes we receive an excess of 100 proposals. Geographically, the World Dank tends to move to the center and west of the country where development is most needed, but we still do some innovative projects in places such as Shanghai. For instance, the World Bank has an ongoing low cost housing and energy efficient building project there.
CSST: Urban development is key for overall development, especially for developing countries. However, while urbanization brings opportunities for the population, it also causes problems. How we can overcome this dilemma?
Klaus Rohland: Our overarching objective in China is urban development. Looking at China in 2011, roughly 50% of the population was living in cities, and we expect that over the course of the next 20 years, more than 300 million people will move from rural to urban areas, so urban development will be hugely important for China. How can we make sure that cities in the future have deliverable, environmentally clean, sustainable and all-around good transportation systems? How can cities provide economic opportunities, education opportunities for children, healthcare and hospitals?
Many things need to be done. Growth in China in the next 20 years will require changes in China — in a modern way but also in a harmonious way -- harmony between people, harmony between people and nature, harmony between China and the world. These three harmonies are very important for China and the world at large.
First and foremost, as you think about development, you have to put people at center stage, which means you have to move to comprehensive system of development. It’s about infrastructure, but not just the physical infrastructure—it’s about the livable infrastructure. It’s about jobs, but not only about jobs—it’s about jobs that’s sustainable and environment friendly. It’s about transportation, but it’s about transportation that addresses environment needs.
The second most important area for China’s development would probably be energy efficiency. China has a lot of potential for solar energy, renewable energy and wind power. I want to emphasize that the benefits of energy saving for China in terms of overall energy efficiency cost and therefore as a driver for future development.
I want to emphasize that in all the years I work in China, I’ve always been impressed by the ability of Chinese policy makers and Chinese people to be proactive on these sort of issues. They always have ideas of how to do things and how to make things better. China which is on the cutting-edge of development, so I am fundamentally very optimistic about its continued ability to address its challenges proactively.
CSST: Urbanization and aging always go hand in hand with modernization. What’s your suggestion for China to tackle aging?
Klaus Rohland: The world population is 7 billion. As populations get wealthier and live longer, people tend to have fewer children than in the past; that’s just the way how the development works and not much can be done about that.
Klaus Rohland: The world population is 7 billion. As populations get wealthier and live longer, people tend to have fewer children than in the past; that’s just the way how the development works and not much can be done about that.
A single family has one child. This is the issue that many countries face. In China, it may largely because of the constraints of the one child policy, but other countries without that constraint also see declining fertility rates; in many EU countries, the reproduction rate is about 1.8/1.9, not much more than in China. This all needs to be understood better. Another contributing factor is that when more women go to university and have careers, they tend to have children later in their life than previously, which also has a huge impact on the reproduction rate. So, comprehensive problems need to be resolved comprehensively.
When my own country Germany was one of the first countries to introduce pensions in 1890, the retirement age was 65, but life expectancy was roughly 71, so fundamentally you had to have a pension system that carries people average for about 6 or 7 years. Today in china the average life expectancy is about 78/79 years, yet the women in China can retire at age of 55. That means the pension system needs to carry for them for about 15 or 25 years—it is a totally different system from the system where the population needs to live on their pension for about 5 or 10 years. So China has to think about adjusting by increasing the retirement age. That’s very painful around the world; people don’t like to hear that. China is still a little way away from demographic change, so it’s good to think about it now.
CSST: The World Bank primarily addresses development projects. As your career has given you broad exposure to various cultures, do you think there is a unified development model that applies to all countries?
Klaus Rohland: Cultures are different from country to country; history is different from country to country. There is no one development model that works anywhere and everywhere. On the other hand, human beings have a lot in common—everybody prefers smiling to shouting, everybody prefers love to hate, and everybody prefers peace instead of war, so I am also a great believer of the commonality between mankind. A great fortune of my career has been the opportunity to travel through many countries. I’ve discovered that people speak different languages, but have a lot more in common than one might think.
In terms of a development model for a specific country, it’s important to understand the differences between cultures to understand where a particular model comes from. For instance, I used to work on Pacific Islands in the middle of the ocean, east of Australia. They don’t have private property on the land. While a lot of people would argue that they should privatize, the island is so small and vulnerable that if somebody gets too much land and does something wrong with it, the whole nation is at risk. So suddenly you have a notion that they should have common property of the land. Otherwise they couldn’t survive.
CSST: Lastly, what are the challenges for the World Bank working in China?
Klaus Rohland: The foremost challenge to working in China involves simply keeping pace with the rapid development. As an institution that provides knowledge, we are credible and successful only when we stay with the cutting edge of global knowledge. We try to work hard to stay with the issues, and that’s fun.
Klaus Rohland: The foremost challenge to working in China involves simply keeping pace with the rapid development. As an institution that provides knowledge, we are credible and successful only when we stay with the cutting edge of global knowledge. We try to work hard to stay with the issues, and that’s fun.
The Chinese version appeared in Chinese Social Sciences Today, No.405, Jan.16, 2013.
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