Antalya G20 summit: Remarks at pre-summit press briefing
I would like now to outline briefly for you the OECD’s perspective on, and contribution to, the G20 activities, work and agenda this year under Turkey’s Presidency. This has been a very active contribution, wide-ranging and multifaceted – which, hopefully, will contribute to the success of the Antalya Summit.
But before elaborating on how G20 is contributing to a fairer and more inclusive global economy, let me recall the economic “backdrop”.
Global growth prospects have dimmed again this year. Our Economic Outlook, released last week, showed a dramatic slowdown in global trade growth this year. This is genuine cause for concern. World trade has usually been the “bellwether” of global output and such weak numbers have tended to foreshadow a global recession.
We are also worried about the type of growth that is being generated, because it is not sustainable:
- Socially: With inequalitiesat an all-time high in many OECD countries and are even wider while inequalities in emerging market economies. The OECD has shown that this has a negative impact on growth. We are also faced, notably but not only, in emerging countries, with issues such as poor quality jobs and informality.
- Environmentally: We are on a collision course with nature and the carbon clock is ticking! The OECD has just released a new report with updated numbers on the economic impact of climate change and consequences of inaction on this front. The latest OECD analysis shows world GDP in 2060 could be lowered by 2% on average, and in South and Southeast Asia by nearly 4%, mainly due to losses in agriculture and sea level rises.
To what extent has the G20 agenda, this year, contributed to addressing those defining challenges? How can it make a difference in terms of turning the world into a more prosperous and fairer place? And how has the OECD, itself, participated in G20 efforts in these areas?
I am proud that the OECD actively contributed to Turkey’s “Implementation, Investment, Inclusiveness” trilogy. Let me give you a couple of examples and illustrations of our contributions to the robust and inclusive growth ambition of the Presidency.
Boosting growth and kick-starting investment
The G20 embarked this year on the implementation of the Brisbane National Growth Strategies. We have been supporting the group of countries in this process:
- by helping countries identify 300 key commitments out of the initial 800 Brisbane commitments encapsulated in the National Growth Strategies;
- by supporting the peer review exercise which underpins the implementation of the Strategies;
- by providing a quantitative assessment of progress towards the 2% additional growth target.
Our assessment, jointly with the IMF and the World Bank Group, has found that less than one half of the policy commitments encapsulated in the National Growth Strategies have been fully implemented. These should raise G-20 GDP by around 0.8% by 2018. This is a start, but not enough: implementation of their growth commitments by G20 countries must be accelerated!
The OECD also supported G20 countries in the elaboration of ambitious G20 country investment strategies.
Making the global economy, trade and global value chains more inclusive for SMEs and low-income developing countries
The OECD supported the Presidency’s emphasis on SME development and the participation of LIDCs in the global economy, as part of its inclusiveness agenda:
- Report on inclusive global value chains for SMEs and LIDCs;
- G20 High Level Principles on SMEs financing which will be presented to Leaders;
- Revision of the OECD Principles of Corporate Governance, and their transformation into G20/OECD principles, and which will also be presented to theLeaders.
Fostering inclusive growth and making labour markets work for everyone
The comprehensive policy package which has been promoted by Turkey – including skills, youth employment, job quality and tackling inequalities - represents real progress. Let me commend Turkey for having developed a fully-fledged, coherent and ambitious inclusive growth agenda and for conveying the message, within and from the G20 that addressing large and widening inequalities is important in its own right (ethically, socially, politically), but is also critical for growth. This is a welcome reversal of perspectives on the growth – inequality nexus. The OECD provided concrete support to the crafting of this policy package:
- Skills strategy: The OECD, jointly with ILO developed a G20 Skills Strategy to counter inequality and grapple with low productivity growth in many G20 countries.
- Youth employment: The OECD will monitor implementation of plans to reduce the number of young people not in work, education, training, or working in the informal sector.
- Job quality: A G20 Quality Job Framework was developed by the OECD with inputs from ILO.
Of course, this change of perspective by the G20 on growth and inclusiveness still needs to be made operational across the range the G20’s work, including in the finance sector , and specifically into the National Growth Strategies. But this is encouraging and the OECD will continue to support this refocusing of the G20 agenda.
A more transparent, effective and fairer international tax architecture
Some of you were perhaps there. The OECD delivered on the remaining action points of the G20/OECD Base Erosion and Profit Shifting project to Ministers of Finance in Lima, in October 2015. This is the culmination of intensive work since the crisis to lay the foundations of a fairer, more transparent and more effective international tax system. Under the mandate given by Ministers of Finance to the OECD in Ankara in September, to be submitted to Leaders here in Antalya tomorrow, the OECD will be developing the tools and the mechanisms for implementation and follow-up of the 15 BEPS agreed actions. The OECD which hosts the Global Forum on Tax transparency hosted at will continue to support and monitor progress towards the implementation of Automatic Exchange of Information and implementation of the international standards on Exchange of Information on request.
To conclude: In our view, under the Turkish leadership, the G20 has made a very meaningful contribution to the global inclusive growth agenda. Implementation, in all these all areas will be the touchstone of G20 credibility. Thank you.
For more information visit: www.oecd.org/g20