the OECD in 5 key points

the OECD in 5 key points


© Martin Bureau
From the left, the President of the European Council, Charles Michel, the French President , the Secretary General of the OECD, Ángel Gurria and the Spanish President Pedro Sánchez, in Paris, on December 14, 2020

The OECD, which celebrates its 60th anniversary this Monday, has gained influence on the international economic scene in the last ten years, but its role remains little known a few months after the renewal of its Secretary-General.

– “Sleeper ugly” –

The Organization for European Economic Cooperation (OEEC) was founded in 1948 to administer the Marshall Plan for the reconstruction of Europe, financed by the United States.

In the late 1950s, Western leaders, concerned about the spread of communism, created a new body to “promote sustainable economic growth, employment and prosperity”: the Organization for Economic Cooperation and Development (OECD ), who was born on September 30, 1961.

The Council, chaired by the Secretary General and made up of the ambassadors of the 37 member countries, provides strategic guidance to more than 300 committees that cover almost all public policies. Descicions are taken by consensus.

“Before, it was kind of dusty, technical, incomprehensible committees, soft rules that got nowhere. It wasn’t the sleeping beauty, it was the ugly sleeper,” says one executive. Everything changed, according to him, with the Mexican Ángel Gurría, his Secretary General since 2006, whose term expires in June.

Ten candidates, including one close to and two former European commissioners, are in the running to succeed him.

– Reports –

The OECD is above all a gigantic statistical database that is used to evaluate public policies and facilitate trade between countries.

It produces around 500 reports a year, ranging from immigration and employment policies to gender equality and traditional economic forecasts, but it also sets international standards (more than 450 in 60 years): its bestseller is a manual for the codification of tractors, for example.

It is also a forum in which officials, experts and academics meet. Before the pandemic, the OECD headquarters in Paris hosted almost 200,000 visitors a year.

– A “rich man’s club”? –

It is the nickname they have given him. In fact, its 37 members represent 60% of world GDP. But “20 years ago it was 80%,” says the aforementioned executive. And the institution is opening up to the emerging world: in 2020 Colombia joined and this year Costa Rica was invited.

The organization, which embodied the “Washington consensus” (liberal orthodoxy), has also “understood that the issue of inequality is crucial,” according to this source. Laurence Boone, her chief economist, refers to her very often.

“In Europe, the OECD is seen as a liberal organization, which is against the minimum wage or wants to increase the retirement age, but in the United States or Australia we are seen as communists,” says another.

– End of bank secrecy –

It was his greatest success. The OECD’s work, commissioned by the G20, undermined bank secrecy by introducing the automatic exchange of information between countries to combat tax evasion.

Since 2009, 84 million bank accounts have been affected, resulting in the collection of 102 billion euros in taxes.

However, the OECD has so far failed to close a highly controversial case, blocked by the United States: finding an international way to tax large digital companies, especially American ones, which are accused of paying negligible taxes in relation to their huge benefits.

– The “shock Pisa” –

Another high-profile OECD project is the Program for International Student Assessment (PISA), a giant test performed every three years to compare the performance of education systems (in 2018, 600,000 students from 79 countries were assessed) .

The results often provoke intense public debate, especially in the lowest scoring countries, while others are presented as models.

In Germany, the revelation that student achievement in reading and mathematics was below the OECD average triggered an electroshock in 2000 and led to massive investments in education.

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