Opening Remarks by Angel Gurría, Secretary-General of the OECD, delivered at the Japan 50th Anniversary Symposium
9 April 2014, Tokyo, Japan
(As prepared for delivery)
Ladies and Gentlemen,
It is a great pleasure to be here to celebrate this momentous occasion: the 50th Anniversary of Japan’s accession to the OECD. I’d like to thank the Japanese Ministry of Foreign Affairs for organizing this event and hosting me in this vibrant and dynamic city.
50 years ago Tokyo was just emerging on the global stage as a world class city, as host of the 1964 Olympics. This was the same year that Japan joined the OECD. At this time, Japan was a nascent industrial power: GDP per head was about $835, and exports were around $6 billion.
Today, Japan is one of the largest economies in the world, with GDP per head of around $50,000 and close to $1 trillion of exports of goods and services. This has been an amazing journey, and we feel honoured to have worked together with Japan during all these years to support their impressive economic transformation.
As we look back over 50 years of our collaboration, I’d like to highlight the great contributions Japan has made to the OECD.
Japan has been a remarkable contributor to the OECD
Japan was our first Asia-Pacific member country, and helped the OECD to become a more global and inclusive organization by strengthening the OECD’s ties within the region. Japan endorsed Korea’s 1996 accession to the OECD, took a leading role in OECD initiatives to address the Asian financial crisis in 1997, and has been a strong financial supporter for programmes to promote investment and improve corporate governance in the ASEAN region.
And, most recently, Japan has been a leading voice in establishing the South-East Asia Regional Programme.
Japan has played a crucial role in our path breaking work on Base Erosion and Profit Shifting (BEPS) as Chair of the OECD Committee on Fiscal Affairs (CFA), and has strived to broaden and strengthen our work on development.
These rich and wide-ranging contributions are of great value to the OECD and its member countries. But, much like a Japanese Bonsai tree, which represents harmony between nature and man, the Japan-OECD relationship is one of balance and equality. The OECD has also helped to support Japan’s own growth and vitality.
The OECD: Fostering Japan’s Vitality
The OECD was the first international organisation to visit Japan only 5 weeks after the Great East Japan Earthquake in 2011 to offer our assistance.
During that visit, I presented our 2011 Economic Survey of Japan, which included a forecast of 2.3% growth in 2012, showing our confidence that Japan would recover quickly – as it actually did!
To help contribute to Japan’s recovery, the OECD and the Japanese Ministry of Education launched the Tohoku School project. This school helps students support the region’s recovery while also developing their own competencies. I had a chance to visit the school this week, and could see that the students are bouncing back, much like the Japanese economy.
The OECD’s contributions to Japan’s domestic policy have also born fruit. For example, adhering to our Code for the Liberalisation of Capital Movements has helped to internationalise the Japanese economy. The OECD has also helped Japan better protect its environment, improve the efficiency of its tax system, and protect e-consumers, via the OECD’s e-commerce protection guidelines.
As Japan pursues an ambitious domestic reform agenda, we hope to continue working collaboratively – on areas such as ageing, climate change and risk management to help Japan address challenges that lie ahead.
Continued collaboration on the road ahead: Abenomics and beyond
We are already working collaboratively to support the advance of the third arrow of Abenomics – Japan’s growth strategy. This calls for a broad based structural reform package to address Japan’s key challenges, such as its productivity gap relative to the leading OECD countries.
Indeed, productivity, in 2012, was 31% below the average of the top half of OECD countries. In the past, Japan’s high labour input more than offset this productivity gap. But the labour input will only continue to decline as the majority of Japan’s workers age and the working age population shrinks. Tackling the dualism of the labour force, and better integrating women, is key to mitigating the decline in labour input stemming from demographic changes - and enhancing productivity.
We find that if female employment rates were to converge with those of men over the next 20 years, the fall in labour supply would be limited to 5% (instead of falling by 17%), and GDP would increase by almost 20% over two decades.
Later today I will present to Prime Minister Abe a brochure – our Better Polices Series – which proposes a range of other measures to boost productivity, such as removing barriers to product market competition, facilitating inward foreign direct investment, and improving the business climate for young innovative firms, bring more people into the work force, and to enable women to balance their work and personal lives.
Ladies and Gentlemen,
The final arrow of Abenomics is key to revitalizing Japan’s dynamic economy. At the OECD we are fully confident in the power and resilience of the Japanese economy, and are looking forward to hearing your insights on resilience and recovery at the Ministerial Council Meeting on “Resilient Economies and Inclusive Societies – Empowering People for Jobs and Growth” in May.
Your chairmanship of this meeting will provide Japan and all OECD countries with an opportunity to share best practices and develop new strategies to create a world of sustainability and inclusivity.
Japan’s chairmanship of the MCM also adds another chapter to what has been a long history of cooperation and collaboration. I am sure this great partnership will continue to flourish in years to come, and in 50 years from now, we can look forward to a centennial celebration of the OECD and Japan’s great relationship.