ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT (OECD) (ENCYCLOPEDIA)
1. History and Objectives
The Organisation for Economic Co-operation and Development (OECD) was formed in 1947. Initially called Organisation for European Economic Co-operation (OEEC), its priority objective was to undertake the reconstruction of the European economy after World War II by making use of the American aid of the European Recovery Program, well known as Marshall Plan.
The first convention for economic co-operation between European countries was signed in 1948 and it came into effect on 28 July of the same year. The signatory states were Austria, Belgium, Denmark, France, Greece, Ireland, Iceland, Italy, Luxembourg, Norway, the Netherlands, Portugal, Sweden, Switzerland, Turkey, and the United Kingdom. Germany and Spain joined in 1959.
The OECD was created with the aim of being a permanent organisation for economic co-operation, its headquarters were established at the Château de la Muette in Paris in 1949. The Organisation began to operate in accordance with the following principles:
- to promote co-operation between participating members and their national production programmes for the reconstruction of Europe;
- to develop intra-European trade by reducing tariffs and other barriers to the expansion of trade;
- to study the feasibility of creating a customs union or free trade area;
- to study multi-lateralisation of payments, and to achieve conditions for a better utilisation of labour.
On 14 December 1960, the OECD was established and it aimed to create a real economic union between the member countries. The Organisation for Economic Co-operation and Development became effective from 30 September 1961 succeeding the OECE.
In 1961, the OECD consisted of the European founder countries of the OEEC plus the United States and Canada. Over the years, many other countries, such as Japan (1964), Finland (1969), Australia (1971), New Zealand (1973), Mexico (1994), Korea (1996); the Czech Republic (1995), Poland (1996), Hungary (1996) and the Slovak Republic (2000) joined the Organisation. In a Supplementary Protocol to the OECD Convention, the signatory states decided that the Commission of the European Community "shall participate in the work" of the Organisation. This participation goes well beyond that of a mere observer, and in fact it gives the Commission quasi-Member status.
The main mission of the OECD is to achieve the highest sustainable economic growth and employment and a rising standard of living in Member countries, while maintaining financial stability, and thus contributing to the development of the world economy and to the expansion of world trade on a multilateral and non-discriminatory basis. In order to participate to the development of the world economy, the Organisation has progressively extended its attention to a growing number of other countries, in addition to its thirty members. It now shares its expertise and accumulated experience with more than seventy developing and emerging market economies.
In May 2007, OECD countries agreed to invite Chile, Estonia, Israel, Russia and Slovenia to open discussions for membership of the Organisation and offered enhanced engagement, with a view to possible membership, to Brazil, South Africa, China, India and Indonesia.
2. Tools to reach the OECD’s goal
The OECD pursues its goals by using different tools and activities, such as domestic and international policy co-ordination, data collection and analyses, policy experience comparison, and peer review examination, a process through which the performance of each country is monitored by their peers; the peer review process is regularly assessed by the Development Assistance Committee (DAC) providing international guidelines and monitoring development co-operation policies and programmes.
In order to reach the OECD’s priority targets, member countries should manage all the resources at their disposal, promote scientific research and professional education, encourage economic growth and financial stability, as well as remove obstacles to free trade and capital movements.
Member countries provide assistance to less developed countries through capital supply, technological assistance and market enlargement; furthermore, they cooperate and work on common projects, making available all the information and data required by the OECD. Nowadays, the OECD’s work is based on a worldwide range of topics such as education, science, agriculture, and taxation, giving special attention to economic co-operation and to goods, contracts and invisible capitals liberalisation.
3. OECD’s structure
The OECD’s structure includes the Council, made up of one representative per member country, plus a delegate of the European Commission, about 200 specialised Committees composed by representatives of the OECD members, and based on specific areas such as economics, trade, science, employment, education or financial markets, and the Secretariat, led by the Secretary-General.
All member countries are represented in the Council, therefore it is the major authority of the OECD’s administration; the Council meets at ministerial level once a year to elect its president and two vice-presidents. Every decision is taken by consensus, except for special cases agreed unanimously. Countries can abstain from a single decision if they are not interested in.
Committees meet each year to request, review and contribute to work undertaken by the OECD Secretariat. Committee members are typically subject-matter experts from member and non-member countries.
The Secretariat is organised in Directorates. The Secretariat supports the activities of the committees, and carries out the work in response to priorities decided by the OECD Council. The Secretary-General is appointed by the Council, he/she serves a five-years term and is assisted by one or more Deputy Secretaries-General. Mexican Angel Gurría is the Secretary-General of the Organisation from 1 June 2006, in succession to Donald J. Johnston. Mr Gurría also chairs the Council, providing the link between national delegations and the Secretariat. Other additional tasks of the Secretary-General concern the preliminary study and implementation of Council and Committees instructions.
4. Civil Society and the OECD
The OECD recognises the valuable contribution that civil society can make to the public policy-making process, and attaches great importance to the Organisation’s own consultation and dialogue with civil society organisations (CSOs). Civil society is also involved in different OECD activities such as poverty reduction, sustainable growth, conflicts prevention and exchange capacity improvement. The OECD has co-operated with civil society since its creation in the field of environment. For many years, this co-operation took place principally through the Business and Industry Advisory Committee (BIAC) and the Trade Union Advisory Committee (TUAC). In the past decade, the OECD has extended these activities to a broader range of stakeholders, notably other international civil society organisations.
The OECD has official relations with other international organisations, such as the International Labour Organization (ILO), International Monetary Fund (IMF), Food and Agriculture Organization (FAO), and World Bank.
5. Statistics, social data and publishing
The OECD has been one of the world's largest and most reliable sources of comparable statistics and economic and social data. As well as collecting data, the Organisation monitors trends, analyses and forecasts economic developments and researches social changes or evolving patterns in trade, environment, agriculture, technology, taxation and more. The Organisation represents one of the largest and most appreciated publishers in the fields of economics and public policy; OECD publications are the main vehicle for the circulation of its output, both on paper and online.
ARMINGEON K. and BEYELER M. (2004), The OECD and European Welfare States, Edward Elgar Publishing.
CARLUCCI F. and CAVONE F. (2004), La Grande Europa - Integrazione, Allargamento, Sviluppo, FrancoAngeli.
OECD (2008), Organisation for European Economy Co-operation, OECD website (http://www.oecd.org).
OECD Historical Series (1997), Explorations in OEEC History, OECD Publishing.
Editor: Federica ALFANI
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