Remarks by Angel Gurría
20 August 2020 - Paris, France
(As prepared for delivery)
Majesties, Ministers, my good friend Dr. Han, dear Kenzo, dear friends President Asakawa and President Tanaka,
COVID-19 has caused a global health, economic and social crisis without precedent in living memory.
The 6% decline in global GDP that we project for 2020 in our most recent Economic Outlook is larger than any other decline in the 60 years of OECD’s existence. And in case of a second wave of infections, global GDP could decline by more than 7.5%.
The lockdown measures have slowed the spread of the virus, but they have also frozen business activity, widened inequality, disrupted education and undermined confidence.
To achieve a resilient, inclusive and sustainable recovery we will need action on three fronts.
First, we must enable firms to build more resilient supply chains, with larger stocks, a greater diversification of sources of supply, with more focus on risk management and on stress-testing essential value chains, and less trade and regulatory policy uncertainty. Unexpected shocks can push governments to adopt measures that would encourage firms to “shorten” their supply chains and produce more “at home”. Doing so would not just be costly to the domestic as well as the global economy, it would effectively increase risks and instability by restricting more diversified sourcing and imposing the entire cost of adjustment to any shock on the domestic economy.
Second, we must keep interest rates low and ensure public spending and taxation support economic activity. Low inflation forecasts support this scenario.
And third, we must focus public investment on people’s well-being. The pandemic has underscored the benefits of investing in resilient health care systems, as well as foresight and preparedness in building and stockpiling supplies of emergency equipment. Public spending should be well-targeted, aimed at supporting the most vulnerable, and to ensure a sustainable recovery.
But the pandemic is only one of the many shared risks facing the international community. Among the most chronic of global risks is access to safe water, a topic very close to my heart. Limited access to water and sanitation can lead to a cycle of increased risks of infections, including increased exposure to COVID-19, serious health outcomes and poor living conditions. Yet, 2.4 billion people globally still do not have access to safe water.
The massive disruptions caused by the pandemic have led to business continuity difficulties, not least in water resource management. Social distancing and travel restrictions have delayed key water infrastructure works, upgrades and repairs. And this comes at a time when water resource management and water conservation is in dire need of funding, estimated by the OECD in the ranges from a cumulative USD 6.7 trillion (from 2013) by 2030, to USD 22.6 trillion by 2050, also in cumulative terms.
Well-designed and long-term investments in water infrastructure can markedly improve the capacity to reduce disaster risks and support climate adaptation, while contributing to economic recovery. Now, more than ever, governments have a responsibility to ensure access to water and sanitation for all.
The OECD is contributing to this important agenda. Some of our most recent work on water and climate change focuses on agriculture, cities, governance and adaptation strategies, with the “Recommendation of the OECD Council on Water” providing an overarching framework.
The COVID-19 crisis has amplified calls for resilience and preparedness to deal with shocks such as water-related disasters. As governments conceive recovery strategies, the High-Level Experts and Leaders Panel on Water and Disasters (HELP) can play a key role in linking COVID-19 recovery plans to a more prepared and resilient future.
In particular, the new Principles to Address Water-related Disaster Risk Reduction under the COVID-19 Pandemic developed by HELP calls for better risk governance by integrating actions on risk management of disasters and pandemics. By highlighting the importance of producing disaster risk maps for hospitals and of protecting disaster evacuees from threats of COVID-19 with improved shelter management, the Principles can save lives. I also particularly support the notion of youth as essential agents of change by mobilising youth groups to fight against both COVID-19 and water-related risks.
Majesties, Ladies and Gentlemen,
Since the onset of the COVID-19 pandemic, the OECD’s message has been to build back in a way that protects the environment, public health, and safeguards people’s well-being.
This crisis is an opportunity to progress towards long-term targets and to pursue a sustainable recovery that is inclusive, low-carbon and climate-resilient. Addressing water management and water-related disaster risk reduction is an essential component of these objectives.
Count on the OECD to continue working with and for you to shape the post-COVID-19 world in an inclusive, sustainable and resilient manner.