Profile: Dr Mohan Kaul, Director-General of Commonwealth Business Council

Dr Mohan Kaul has been at the driving seat of the Commonwealth Business Council since it was set up more than a decade ago, leading the way in advocating for opportunities for business and enterprise across the 54-member association.

Last month the Indian-born Director General hosted the Council’s flagship Business Forum in Trinidad and Tobago, a two-day trade fair of more than 1,000 local, Caribbean and international businesses held directly before the Heads of Government Meeting (CHOGM) in Port of Spain.

“There are a lot of people who have questioned why Trinidad should spend the money it has on CHOGM,” Dr Kaul remarks. “The same question was asked [at the last summit in 2007] in Uganda.”

“Since the CBC has organised this part of CHOGM we have said to governments that the forum will bring you investment. Whatever costs you put in will be balanced by the investments you receive.”

CHOGM and business deals

The summit, Dr Kaul says, saw an estimated “US$1 billion” in deals signed between local and international businesses. Among these was an agreement between the South Trinidad Chamber of Industry and Commerce and the Petroleum Club of Nigeria, paving the way for Trinidad’s energy businesses to assist in developing Nigeria’s gas capacity.

A dozen years ago however, the notion that the Commonwealth, a collective of more than 50 like-minded states joined together by the Commonwealth Secretariat, could have such an impact on the world of commerce was a mere flight of fancy, he recalls.

As a senior official of the Secretariat in the 1990s, and one of the first officials to visit post-Apartheid South Africa, Dr Kaul explains that he came to realise that the Commonwealth could do much more than mere public service reform. “I remember it was 1996, and I said to the then Secretary-General [Chief Emeka Anyaoku]: ‘There is something missing in our Commonwealth work. We are not really engaging the private sector.’ And he agreed.”

A business case for the Commonwealth?

It was a full year however before Dr Kaul got the crucial backing he needed in the shape of an energetic, new British Prime Minister. “Is there a business case for the Commonwealth? That is what Tony Blair asked,” Dr Kaul recounts of his first meeting with the British premier.

“We did a study with the London School of Economics and went back to Prime Minister Blair. We found, at that time, that Commonwealth trade was worth two trillion dollars and that within the Commonwealth there was a natural affinity to do business.”

“Commonwealth member states,” he explains, “have the same accounting system, same legal system, same language, and that makes it possible for companies in Commonwealth countries to reduce their transaction costs 10 to 20 per cent. So we said ‘there is a business case - a two trillion dollar case’.”

The Commonwealth Business Council was subsequently endorsed by Mr Blair and other Commonwealth Heads of Government in 1997 and Dr Kaul took the helm as Director General. “The main consensus was that we should be independent body set up by governments but led and managed by private sector,” says Dr Kaul. “It should be a primary interface between developed markets and developing markets and a primary interface between large international businesses and small businesses.”

The march to the free market

By the tail end of the 1990s, most developing countries had begun the transition to market-orientated policies. But many Commonwealth countries still needed guidance along the path to free market economics, says Dr Kaul, describing the Council’s role as an “honest broker” and “facilitator” between governments and the private sector.

“The thrust at that time was for the liberalisation of markets, privatisation and reducing government structures or government involvement in the economy. So the main role for us related to how we helped governments increase the private sector’s role in economy,” he says.

Dr Kaul credits the growth in many countries in the intervening years to the success of local entrepreneurship, improvements in infrastructure and the swelling of the middle classes. “The number of people in the middle class in the last ten years has increased by two billion globally,” he says. “Much of that is in China and India but a large number is also in countries like Tanzania, Sierra Leone, Bangladesh and Tonga.”

The Council’s greatest challenge, and perhaps its biggest success, has been overcoming the negative perceptions of international investors, he continues. “They have choices. They can invest in London, India, Paris or New York. Why should they go to a place if they don’t get the profit? That was the first priority, to say: ‘you will make more profit in these countries’.”

Economic development

“When I went to Tanzania in 1998 most people said there was no chance of change – that it was a centrally run economy and it just won’t happen. But you go to Tanzania now and you see for yourself how the country has changed. Economic development has taken place.”

Today the Commonwealth Business Council provides support to governments and businesses alike to help increase international trade and investment and develop opportunities and access to new and emerging markets. It delivers training through educational institutes and organises a plethora of meetings for business leaders around the globe.

Yet Dr Kaul is keen to stress that the Council is not simply a champion for untamed, unfettered capitalism. The organisation is vigorous in promoting good governance and corporate responsibility and tries to facilitate the development of information and communication technologies aimed at bridging the digital divide.

“The private sector can play much more important role,” explains Dr Kaul. “It is still the primary driver of the economy. But we want socially relevant, socially responsible market-orientated policies.”

“All of this,” he says, “should lead to the social and economic development of the people.”

Secretariat Links:

• Commonwealth Business Council