Opening remarks by Angel Gurría
22 May 2019 - OECD, Paris
(As prepared for delivery)
Welcome to the OECD’s 2019 Ministerial Council Meeting. Let me first of all thank the Chair of the MCM, the Slovak Republic, and the Co-Chairs Canada and Korea, for their hard work.
Dear Prime Minister Pellegrini, Ministers, Deputy Ministers, Ambassadors, Ladies and Gentlemen:
Your presence today reveals the appreciation of your governments for the work of the OECD, but it also reflects the support of your countries for multilateralism.
We are facing challenging times. The world economy has entered yet another period of deceleration. Trade tensions keep escalating, weakening investment prospects and growth potential. The middle classes are squeezed and shrinking. The share of wages in GDP keeps falling. Progress in achieving the Sustainable Development Goals is not enough to meet its targets. Global carbon emissions are growing again and biodiversity is declining at unprecedented rates. Public trust in governments remains at record lows.
Our economic systems, powered by trade and investment liberalisation, have produced enormous wealth and progress, but they are leaving many people behind and putting unbearable pressure on the earth’s natural resources. This needs to change. We need to promote a new type of growth. One that is more inclusive, more sustainable, greener, and more human. We need a people-centred growth.
The digital revolution is opening unprecedented opportunities to achieve this transformation.
That’s why this year’s MCM focuses on “Harnessing the Digital Transition for Sustainable Development”.
Progress is taking place in virtually every area of daily life: from delivering healthcare to remote areas, to advances in education and transport, communication, energy systems, to helping us to deliver the SDGs and to tackle climate change.
At the same time, however, digitalisation is also creating disruption and bringing new challenges for policymakers. To begin with, there is the productivity paradox. It was some thirty years ago that Robert Solow said ‘you can see computers everywhere except in the productivity statistics’. The same can be said about digitalisation today.
But this is not the only paradox. Digitalisation can facilitate start-ups and competition, yet business dynamism in OECD economies has weakened and market concentration has risen. Digital technologies make it easier to diffuse know-how, yet the diffusion of innovation seems to have slowed. The digital transformation is creating ever-greater needs for re-skilling and up-skilling, yet we find that those most exposed to disruption are least likely to receive training.
Digitalisation also raises questions about security, privacy and data governance, consumer protection and child safety, and again, the issues of competition and market concentration. It challenges policymakers to examine whether the existing tools and frameworks in these areas are still adequate.
At the OECD we have been hard at work to address many of these issues. Our latest and most ambitious effort saw the light last March – after two years of work –, when we launched our Going Digital project. It involved 14 Policy Committees and 10 Directorates. The first phase concluded with a Going Digital Summit, a Digital Strategy, a set of indicators to measure progress, and a toolkit to help policymaking. The second phase is now underway.
One aspect of the second phase is to look in more depth at Artificial Intelligence (AI). Later this morning we will be adopting an OECD Recommendation to provide guidelines on the use of AI to ensure that the approach to AI is trustworthy and human-centric. We will also launch the Observatory of AI and work on this agenda with the G7 French Presidency and the G20 Presidency of Japan. We are also leading international co-operation efforts to meet the tax challenges arising from the growing digitalisation of our economies.
And we are focusing on the Future of Work and the evolving demand for skills. Through the new OECD Jobs Strategy, our Skills Strategy, the 2019 Employment Outlook and the OECD Framework for Policy Action on Inclusive Growth, we are providing integrated strategies for reducing inequalities and allowing all workers to benefit in the digital era.
But we are doing much more to promote a more inclusive and sustainable development.
We launched the New Approaches to Economic Challenges (NAEC) initiative in 2012, to learn from the lessons of the crisis and rejuvenate our economic thinking; the Inclusive Growth agenda with its Framework for Policy Action to help governments distribute more fairly the benefits and opportunities of economic growth; the OECD Framework for Measuring Well-Being, to go beyond traditional GDP, to better measure the living conditions of households.
We are also helping to design cutting-edge policies on SMEs and regional development, rural and urban development; trade and investment; education and skills; health and pension systems, gender inclusion, the integration of migrants. Better policies on regulation, competition and taxes, including our work on Automatic Exchange of Information and BEPS. And more effective development and environmental policies to address climate change, biodiversity loss, water management.
We have intensified our collaboration with the G20, the G7 and other multilateral co-operation fora; we built a stronger capacity to assist governments with their structural reform efforts; and we have developed new international standards on anti-corruption, capital movements, responsible business conduct, corporate social responsibility, public procurement.
We have also strengthened the operation and relevance of this Organisation, making it more strategic and proactive; enlarging its membership; strengthening its collaboration with key partners; multiplying our co-operation with other IOs. We deliver value for money to our members, generating revenues and savings worth several hundred times our budget, through our work on tax transparency, our Export Credit Agreement, our Mutual Acceptance of Data systems in the chemical industry, and others.
These and many other things we do with you, but mostly for you.
And we could do even more, if we work together. Our relevance depends on our common purpose, our agreements, our consensus, our trust. And this is something on which we have to improve.
The OECD delivers. The OECD gives results. The Recommendations on Artificial Intelligence and on Integrity and Anti-corruption in State-Owned Enterprises, the revised Codes of Liberalisation, and the Declaration on Public Sector Innovation are only the latest examples. Our work on taxing digital will bear fruit soon. There are many other cases of relevant work. But to keep delivering, we need a strong institution, with the necessary resources, with strong political support and generous, clear guidance from its Members. And this is becoming increasingly difficult.
Even if on some issues positions among our Members diverge, we should not let this paralyse or weaken our Organisation. In the past, we always found a way. That doesn’t seem possible anymore. But the OECD is stronger when it builds bridges, not when it digs trenches.
Take the budget for instance. While the demands for support from Member countries have grown, our budget has been slashed in real terms, after 10 years allowing for inflation. Our Members’ contribution to the payment of our pensions is being questioned by some, even when there is no financial impact on them specifically.
The divisions among Members have also kept 6 countries waiting (Argentina, Brazil, Bulgaria, Croatia, Peru and Romania) – for three years now and after extensive and comprehensive analysis. They are waiting for an answer to their request to start their OECD accession process. There is a crisis of trust among Members, a crisis of confidence, which is affecting our decision-making process. Our capacity to deliver is being burdened by this lack of trust.
To move forward, we need guidance from you, our Leaders and Ministers who have a responsibility to deliver in response to citizens’ demands. The OECD can help you address these demands. Fighting inequalities, tackling environmental challenges, seizing the opportunities of digitalisation, to name a few: all these require your strategic direction. But I am very concerned that again, even though we may have an MCM Statement of sorts, we have not been able to come up with a text that provides such guidance.
OECD Committees can do expert work, but let me say it once more: the strength of the institution relies on the top-down political guidance from Leaders and Ministers. Thus, we need your political consensus and your commitment to the OECD. You are delivering it in other fora, like the G7/G20/APEC. You have always found the words. Why is it not possible to do so at the OECD? How do we put the OECD first? How do we translate our often mentioned appreciation for the work of the OECD into reality, if not by rallying behind it and giving it our collective support and guidance?
Dear Prime Minister, Ministers, Deputy Ministers:
The world needs strong and effective multilateral organisations that acknowledge and address the dreams, hopes and fears of the people; multilateral organisations that help governments promote inclusive and sustainable growth; multilateral organisations that place human beings at the centre of economics, multilateral organisations that see the digital revolution as the biggest opportunity to improve people’s lives.
That is what we are trying to do at the OECD. That is why we are here today.
With your support, your trust, and your knowledge, we can make it happen!
Thank you for being here. Count on us. We count on you.