Remarks by Angel Gurría, Secretary-General of the OECD
27 June 2010
The global economy is at a critical stage. While a modest recovery is under way, it is progressing at multiple speeds; unemployment is unacceptably high, current account imbalances are widening again, and development gaps persist.
We are facing the "after-shock" of the same crisis. It has always been about too much leverage. First, in the banks, and now in the public finances.
Recent financial market developments, particularly in Europe, have made it clear that we are not out of the woods yet.
The fundamental ingredient that is missing to move beyond this critical stage is confidence. Confidence to create the right environment for private sector demand to take over from governments and sustain the recovery. Leaders can bolster confidence in at least three ways:
As the OECD Innovation Strategy shows, innovation explains more than 50 percent of productivity gains. On the other hand, pursuing "greener" supply and demand patterns can make growth stronger and sustainable. Development policies, as the Korean initiative rightly underlines, is another engine of global growth.
Last but not least, maintaining open trade and investment policies - including doing Doha - will create the right environment for a more vigorous recovery.
The OECD is pleased to be contributing to these initiatives. They will all become increasingly relevant for the success of the Framework.
By thus boosting confidence, we will be in a better position to tackle the most tangible expression of the crisis; the human face of the crisis: the very high level of joblessness, particularly among young people. I have just met with the leaders of the Trade Unions of the G20 countries and there is an increasing sense of frustration among them as unemployment remains unacceptably high. We agreed with them that we cannot deem to have dealt effectively with the crisis until the loss of jobs is reversed, and that we will continue to work with them in the pursuit of that goal.
Mr. Chairman, Excellencies, when the house was on fire we all knew what to do: Get a hose!. Today, the incipient recovery offers policy choices and policy options. While it is good to have choices, it becomes more difficult to find common ground . This should not hold us back: the G20 is the place to find such common ground. The OECD stands ready to continue to support your work between now and Korea, France, Mexico and beyond, to build a stronger, cleaner and fairer world economy.