Keynote Speech by Angel Gurría, OECD Secretary-General, at the OECD 3rd World Forum on Statistics, Knowledge and Policy
27 October 2009, Busan, Korea
Ladies and Gentlemen:
We are here to talk about progress. We have often associated it with increasing economic connections between people, businesses and countries, with international dialogue, co-operation and alliances. In other words, with globalisation, as a driving force for progress. But have we achieved a real and lasting progress? What does progress mean in the 21st century?
Globalisation creates great opportunities, but has not benefited everyone. Globalisation also has important social consequences and creates, as any process of change, new risks and tensions. The OECD recently issued a report addressing the question: are we growing unequal? This is a crucial issue, because persisting or growing inequity in income and wealth disrupts social cohesion and can make society worse off. This is true within countries and also internationally, with some developing countries being left further and further behind.
A major challenge we experience today is the gap between what official statistics say about economic performance, and people’s perception of their own living conditions. We are now hopefully approaching the end of the recession, but the gap was already evident during the years of “good” economic performance and may be widening further today. GDP was growing but most people did not necessarily feel better-off.
Now, the problem is even more critical. There are large fall-outs from the crisis, people losing their jobs, pensions and houses. And things may get worse before they get better. Unemployment will continue to rise in most OECD countries throughout 2010. Last but not least, the emergency rescue package that many countries put in place are often perceived as having mostly benefited the lucky and undeserving few.
Going forward, there is a major risk that people will lose confidence in markets and institutions, and in the capacity of governments to address their problems. This is a major political challenge: we have to restore trust and we can only achieve this if policy action has tangible impacts on people's life.
In these challenging times, the gap between measurement and people's perceptions does not result from low quality of official statistics, but from their inappropriate use. This can lead to biased analysis, wrong policy targets and can be damaging both to the credibility of political action and to the very functioning of democracy.
Statistical systems produce indicators for various purposes. And statistics designed for one purpose may be misleading if used for other purposes. For instance, GDP measures mainly market production.
However, it has been increasingly considered as a metric for households’ consumption possibilities and even as a proxy measure of well-being – a purpose for which it is ill-suited.
Today two significant trends attest to the increasing need for "going beyond GDP":
Already in 2004, the OECD provided a network for the many ongoing initiatives. The OECD World Forum on “Statistics, Knowledge and Policies”, held in Palermo (in 2004) and Istanbul (in 2007), led to the Istanbul Declaration on Measuring and Fostering the Progress of Societies. It was jointly agreed by the European Commission, the OECD, the UNDP, the World Bank and the Organisation of the Islamic Conference. Since then, progress was achieved in a number of ways:
A political momentum for change is also building, with a strong demand for a new generation of statistics. The most salient expression of this demand is the international commission set up by French President Sarkozy chaired by Joseph Stiglitz, the Communication of the European Commission on "GDP and Beyond".
Both the Istanbul Declaration and the Report of the Stiglitz Commission propose to move from the current measurement system, based on the metrics of production, to a system that genuinely focuses on societal well-being and progress.
Economic resources are not the only thing that matters in people's life. To duly capture well-being we have to measure the expectations and level of satisfaction of individuals, how they spend their time, their paid and unpaid work, their capabilities, the relations they have with other people, their political voice and their participation in public life. We have to measure capital stocks as much as capital flows. We need to expand the concept of stock to include sustainability issues, such as, the state of our biosphere and metrics related to "green growth". We should also measure various forms of inequalities (in income, wealth, health, education and political voice), with particular emphasis on those that result from the accumulation of weaknesses or handicaps.
The process launched by the OECD in 2004, the recommendations of the Sitiglitz Commission and the call of G20 leaders are opening an ambitious agenda. The way forward will require political will. It will require an international setting in which concepts and methodologies will be defined and harmonised. It will prompt co-operation between different key players: national statistical offices, regional and supranational organisations, policy makers and civil society.
We stand ready to heed the call of the G20 to “encourage work on measurement methods so as to better take into account the social and environmental dimensions of economic development”. We are also ready to meet the request of the French government and act as the international focal point of the follow-up to the recommendations of the Stigliz-Sen Commission.
The OECD is planning an ambitious work programme to deliver on the mandates it received. We are ready, as an Organisation, to continue to provide leadership and contribute to this ambitious agenda. We are currently establishing an OECD roadmap for measuring and fostering well being and progress. This roadmap will be presented to you on Thursday by Deputy Secretary-General, Pier Carlo Padoan.
The OECD stands for lasting progress and we are not alone. We have built an alliance for change. We have a historic opportunity and duty to build a more inclusive vision for the future of our societies. I trust the Third World Forum on “Statistics, Knowledge and Policy” will be a milestone for lasting progress.