Secrétaire général

A reinforced commitment to relevance and impact: high level dialogue with parliamentarians

 

Introductory remarks by Angel Gurría, OECD Secretary-General

17 February 2010, OECD Conference Centre, Paris, France
 
Ladies and Gentlemen,

It is a great pleasure to welcome you to the OECD today. This is my fourth meeting with the NATO Parliamentary Assembly, and I am very happy to recognise some familiar faces around the room.

Relationships with parliamentarians are very important to the OECD. As representatives of the people, you are key stakeholders for our work. We very much value occasions like this to benefit from your feedback and your ideas on how to improve our relevance and impact. 

Later this morning my colleagues will present the Economic and World Energy Outlooks and discuss how the crisis has affected developing countries. Let me now share with you my views of the challenges lying ahead and how they are shaping our work in many policy areas.

 

Reinforced commitment to relevance and impact

A year ago the global economy was on the brink. As the crisis unfolded, credit dried up and international trade came to a near standstill. In 2009, unemployment soared to over 8 % in the OECD area as a whole.  The turmoil triggered bold and swift policy action. This included large fiscal stimulus packages and targeted support measures to avert a global economic collapse. This seems to have worked and recovery is now underway. 

Avoiding the worst outcome required political courage and leadership. It also required countries to work together. If anything, the crisis brought to the fore that in a globalised economy, no single country has all the answers. Multilateral action was a must. 

The OECD was created to facilitate and foster international co-operation. And I am proud to report that we fulfilled our role, helping our members, as well as our partner countries to coordinate policies and put in place the right strategic responses to face the crisis. We presented governments with evidence-based policy choices and encouraged them to build the foundations of a stronger, cleaner and fairer global economy. 

 

Our impact in the global efforts towards a stronger economy

Let’s start with the “stronger” part. Our work with governments aimed to ensure that the short-term emergency measures also had a positive long-term impact. We argued that stimulus packages and other short-term targeted interventions should not distort competition or incentives more broadly. That they should focus on mitigating the social impact of the crisis while improving long-term competitiveness.  We also argued strongly against protectionism. And I am ready to report that at least so far, this is a devil that stayed in the box.

The response to the crisis has brought results. But the situation is fragile and the recovery should not be jeopardised by a premature withdrawal of the support measures. Our message is then to continue with stimulus for as long as they are needed and to withdraw them only once recovery is assured. That said, preparing and communicating well articulated exit strategies will send a strong signal to the markets, boosting confidence and helping the recovery.

Beyond exit strategies, the crisis may have led to a more permanent decline in potential output growth. Here, we have a special role to play to find new sources of growth and job creation. Countries will need to implement policies to boost productivity and competitiveness. Innovation will be one of the keys to putting countries back on a path to stronger growth. In May 2010 we will deliver the final report to Ministers on the OECD Innovation Strategy. It will identify specific policies, frameworks and governance mechanisms that can accelerate scientific and technological progress and diffuse innovation as widely as possible.

Innovation is also key to addressing global challenges and finding more sustainable, green sources of growth. Innovation is the key to make growth and green compatible. In the OECD, we will pursue our work to assist policy makers in adopting the right incentives and set the frameworks to encourage a job-rich and green recovery. We will produce a Green Growth Strategy to present to Ministers next year. And this will also help us solve other problems.

 

Our work for a cleaner global economy

Climate change is the greatest and most immediate challenge we face in building a cleaner economy. The OECD has worked closely with the Danes and with other countries in the run-up to COP15 last December.  Our main message was that achieving the ambitious climate targets of limiting global temperature rise to 2°C is affordable. In fact, we estimate that if the right policies are implemented to price carbon, it will cost just about one-tenth of a percentage point of the world’s annual GDP between 2012 and 2050 to reach that target. Just as a matter of comparison, over the same period of time, world GDP is projected to grow by more than 250%. 


We also need the economy to be cleaner in an ethical sense. We have made many contributions to help governments address what some call “the dark side of globalisation”. Our partnership with the G20 to implement the OECD Model Tax Convention has contributed to a global convergence in the field of tax compliance. The recent expansion and strengthening of the Global Forum on Transparency and Exchange of Tax Information probably means the end of the era of banking secrecy. Over 300 tax agreements were signed in 2009 in order to ensure compliance with the now globally endorsed OECD tax transparency standards. 


The adoption of a new Anti-bribery Recommendation, the launch of the first round of corporate governance peer reviews or the work on a Global Standard for propriety, integrity and transparency, have helped countries align their recovery strategies with the long-term objective of a more ethical economy. Directly related to this concern is our work on lobbying practices. Tomorrow, the OECD Council will discuss the first international policy instrument to address lobbying – the OECD Principles for Transparency and Integrity in Lobbying.

 

Our contribution to a fairer world economy

A cleaner more ethical economy will also help us build a more equitable and fairer world. And this is more important than ever, as we suffer the social consequences of the crisis. Economic conditions will remain tight, particularly with high unemployment and worrisome fiscal positions in almost all countries. We expect that 57 million people will be without jobs in OECD countries by the end of 2010.


Although the job losses have affected all social groups, it is the disadvantaged people in the labour market – youth, women, the low-skilled, immigrants, ethnic minorities and those on temporary contracts – who have borne the brunt of it. In order to prevent unemployment casting a long shadow on our recovery, OECD has produced analysis and recommendations on effective labour market policies and on measures to help the most vulnerable get a firm foothold in the labour market.


Outside of the OECD, there are many countries that do not have a well developed social safety net system. We should not forget their plight. The crisis should not become an excuse to postpone our commitments with the poorest of this world. On the contrary, it is a compelling reason to fulfil them. As the current tragedy in Haiti clearly shows, aid helps but is not enough. It is our role to continue to help developing countries mobilise domestic and external resources to overcome their structural challenges and achieve long-term sustainable development.  

 

The role of the OECD in the changing global architecture

Those are the main challenges ahead and we will only solve them if we work together. The OECD was founded on the principle that prosperity was a sine qua non condition for peace. The prosperity of each country depends on the prosperity of its economic partners and our future lies ensuring that opportunities are available to all. We are convinced that we need to be global and inclusive to maximise our contribution to the world economy. In order to remain relevant in the world economy, we are strengthening our engagement with the major global players, such as Brazil, China, India, Indonesia and South Africa. We are also in the process of welcoming the incorporation of new member countries, starting with Chile. They will certainly enrich the policy debates at the OECD and make us more plural and more sensitive to the complex challenges of countries at different levels of development.


And we are stepping up our work on development more broadly, incorporating more effectively the development dimension in all aspects of our work so our policy experience and expertise can reach more people. 


Ladies and Gentlemen,


I have provided you with just a glimpse of what the OECD has been working on since we met last year. We have great accomplishments, but we do not rest on our laurels. We know that our biggest challenges lie ahead. And that our success is measured by the impact on the lives of citizens worldwide. 


In this quest, we need to be aware of the preoccupations of our main stakeholders. I expect that today and tomorrow will enable us to learn more about your concerns. You pass laws and hold government purse strings. You are at the heart of the democratic system.You are key players in making this a stronger, cleaner and fairer world. You can count on the support of international organisations like the OECD as you set out on this endeavour. 


Thank you.

 

 

 

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