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OECD

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45 views5 pages

OECD

Uploaded by

CeeDyey
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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The Organization for Economic Cooperation and Development (OECD) is

an association of 38 nations in Europe, the Americas, and the Pacific. Its


members and key partners represent 80% of world trade and
investment.1

The goal of the OECD is to promote the economic welfare of its


members. It also coordinates their efforts to aid developing
countries outside of its membership. As a result, its programs help
promote reform in more than 100 countries worldwide.2

The OECD's main headquarters is located at 2, rue André Pascal, 75775


Paris Cedex 16, France. There also are offices in Berlin, Mexico City,
Tokyo, and Washington, D.C.3

Key Takeaways

• The OECD helps countries formulate their economic and social policies.

• OECD members and partners represent 80% of world trade.

• A member must be willing to make economic reforms in compliance with

OECD standards.

History

The OECD was initially called the Organization for European Economic

Cooperation, or OEEC. It was started in 1948, after World War II, to run

the Marshall Plan to reconstruct Europe. Its goal was to help European

governments recognize their economic interdependence. In this way, it

was one of the roots of the European Union.


Once the Marshall Plan was complete, Canada and the United States
joined the OEEC nations, which created the OECD on Dec. 14, 1960. The
OECD went into full force on Sept. 30, 1961.1

Member Countries

Most of the 38 OECD members are from Europe. They are Austria,

Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany,

Greece, Hungary, Iceland, Ireland, Italy, Latvia, Lithuania, Luxembourg,

Netherlands, Norway, Poland, Portugal, Slovak Republic, Slovenia, Spain,

Sweden, Switzerland, and the United Kingdom.

There are five countries from the Americas: Canada, Chile, Colombia,
Mexico, Costa Rica, and the United States. The four Pacific members are
Australia, Japan, Korea, and New Zealand. The two member countries
from the Middle East are Israel and Turkey.2

Note

The OECD's latest member is emerging market country, Costa Rica.4


This process of joining the OECD is long and complicated. A nation must
be reviewed by different member committees. They make sure it
conforms with OECD instruments, standards, and benchmarks. It must
be willing to reform its economy to meet standards in different areas, like
corporate governance, anti-corruption, and environmental
protection.5 The countries designated as key partners, but not members,
are Brazil, China, India, Indonesia, and South Africa.6
Statistics

The OECD collects, analyzes, and reports on economic growth data for its

members. This gives them the knowledge to further their prosperity and

fight poverty. It also balances the impact of economic growth on the

environment.

Note

The OECD monitors economic data so it can update its projections.

Committees within the OECD analyze the data and make policy

recommendations. It's up to each member country to decide how to use

OECD recommendations.

Members have used OECD recommendations in many ways. They've

created formal "rule of the game" agreements for international

cooperation. These rules include prohibitions against bribery as well as

arrangements for export credits and the treatment of capital

movements.

OECD agreements have resulted in standards in bilateral tax


treaties.7 They've also increased cross-border cooperation on outlawing
spam emails. These agreements have also improved corporate
governance guidelines.8
Economic Outlook

Twice a year, the OECD publishes its economic outlook. The OECD
Economic Outlook analyzes the economic prospects for the 38 members
and major non-member countries.9 The Outlook provides in-depth
coverage of the economic policies needed for each member, as well as
an overview of the total OECD area. The report is updated twice per year
to stay current with the significant shifting trends. The OECD updates the
report in March of each year.

Note

The OECD's interim report warned about the severe economic impact of

the COVID-19 pandemic. It forecast a modest upturn in 2021.

Prior to the pandemic, the OECD reported on a strengthening global


economy. It benefited from robust investment, an uptick in international
trade, and higher employment. The OECD warned against a global trade
war. If countries were to revert to mercantilism, then global trade and
economic growth would weaken.10

Reports

The OECD Economic Surveys are done for each member country every
one to two years. They discuss each country's leading economic
challenges and provide policy recommendations.11

The OECD recommended austerity measures to solve the Greek debt


crisis. It said the proposals would make Greece more competitive in the
global economy.12
The "Going for Growth" report helped members recover from the 2008
financial crisis. It highlighted the most significant changes to enhance
long-term growth.13

Education

Every three years, the OECD conducts the Programme for International
Student Assessment.14 It evaluates education systems around the world
by testing the knowledge of 15-year-old students. The OECD uses the
data to recommend ways to improve equity in education.15

Frequently Asked Questions (FAQs)

How is the OECD funded?

Member countries fund the OECD. Members don't pay a set rate. Instead,
their contributions are based on a formula that accounts for the relative
size of each national economy.16

Which OECD country has the highest rate of poverty?

Mexico has the highest rate of poverty among OECD member countries
(43.9%). Colombia has the second-highest rate (42.5%) followed by
Costa Rica (30%).217

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