Achieving national and international development goals demands financing from multiple financial sources. Aid alone will not produce development: the mobilisation and effective use of other financial resources are crucial. The OECD provides a platform for dialogue and co-operation among developed and developing countries to improve investment climates, enhance the effectiveness in tax systems, deepen the integration of developing countries into global markets through trade and investment channels, and maximise the benefits of migration and remittances.
OECD investment policy tools, such as the The Policy Framework for Investment (PFI), assist developed and developing countries alike in identifying appropriate national policies for attracting investment and reaping its full benefits. In 2013-14, the PFI will be reassessed and adapted for broader application in a more diverse set of developing country circumstances. Within the context of the OECD Strategy on Development, we are also examining ways to facilitate long-term institutional investment in developing countries.
Domestic resource mobilisation, based on robust taxation systems and sound budgetary policies, provides developing countries with a stable and predictable fiscal environment to promote growth and to finance their social and physical infrastructure needs.
Good tax administration needs to be complemented with sound budgeting. The OECD Strategy on Development promotes knowledge sharing and peer dialogue with senior budget officials from developing countries on how to link stronger budgetary performance with better and more inclusive financial management and public service delivery in countries facing similar contextual challenges. This work also falls under the theme Governance for Development.
Illicit financial flows – i.e. financial assets that break laws in their origin, transfer or use, including through tax evasion, money laundering, trade and transfer mispricing, as well as bribery of foreign officials – strip resources from developing countries that could otherwise finance development. The OECD has initiated a comparative analysis of the institutional, regulatory and legal arrangements existing in its member countries to address illicit flows.
International migration can significantly contribute to the welfare of populations and to development in origin countries. Migrant remittances are an important source of income to foster development. The OECD Strategy on Development confirms the Organisation’s dedication to building a global governance framework that ensures policy coherence at all levels between migration policies and development policies. Work will focus on key policy areas such as remittances, labour migration at different skill levels, and diasporas.