Organization for Economic Cooperation and Development (OECD)

Organization for Economic Cooperation and Development

An intergovernmental economic organisation called the Organisation for Economic Cooperation and Development (OECD) was founded in 1961 and currently has 38 member nations. It was started to encourage economic growth and international trade. The OECD seeks to create policies that promote universal prosperity, equality, opportunity, and well-being. Colombia and Costa Rica joined the OECD most recently in April 2020 and May 2021, respectively. OECD essentially functions as a think tank or monitoring organisation that is a Permanent Observer of the United Nations.

Organization for Economic Cooperation and Development (OECD) Meaning

Organisation for Economic Cooperation and Development, or OECD, is a multilateral economic organisation with 38 member nations that was founded in 1961. The global association aims to create better public policies for better lives. The OECD offers a singular forum and knowledge hub for data and analysis, exchange of experiences, sharing of best practises, and advice on public policies and international standard-setting, with a focus on enhancing economic performance, creating jobs, promoting strong education, and combating international tax evasion.

The OECD’s membership includes democratic nations that favour free markets. A large portion of the OECD’s members are industrialised nations with advanced economies and high Human Development Index scores. The Château de la Muette is where the OECD’s offices are situated in Paris, France.

In 2021, the OECD commemorated its 60th birthday. The Long View: Scenarios for the World Economy through 2060, another research analysis published by the OECD, is also available. According to the study’s results, real global GDP growth would slow from 3.5% in 2018 to 2% in 2060. India, China, and Indonesia will account for about half of global economic output by 2060, in contrast. Argentina, Brazil, Bulgaria, Croatia, Peru, and Romania are six candidate nations for OECD membership that the OECD Council resolved to start negotiations for membership with in January 2022.

Organization for Economic Cooperation and Development (OECD): Latest News

The revenue secretary proposed expanding the scope of automatic exchange of information (AEOI) and incorporating non-financial assets into the OECD information exchange framework at the meeting of the “Asia Initiative of the Global Forum on Transparency and Exchange of Information for Tax Purposes” in April 2023.

OECD’s AEOI Framework

• It allows signatory nations to exchange financial information in order to prevent tax evasion.
• For automatically transferring information, we have AEOI with 108 jurisdictions and with 79 jurisdictions.
• The flow of information has aided in a rise in tax income and tax collection.
• The Crypto-Asset Reporting Framework (CARF) for the reporting of tax information on transactions in Crypto-Assets was also authorised by the OECD.

Organization for Economic Cooperation and Development (OECD) History

In 1948, the Organisation for European Economic Co-operation (OEEC) was established. The Marshall Plan, a US-sponsored initiative, was governed by the Organisation for European Economic Co-operation (OEEC). As a result, OEEC was crucial in the development of the European Economic Community (EEC).

In order to create a European Free Trade Area, the European Economic Community evolved into the European Union (EU). The OEEC was renamed the Organisation for Economic Cooperation (OECD) in 1961 to reflect the inclusion of the United States and Canada.

Organization for Economic Cooperation and Development (OECD) Member Countries

Members of the OECD and a variety of partners work together on important global challenges at the national, regional, and local levels. The OECD is made up of member nations, substantive committees, and the OECD Secretariat. There are currently 38 nations that make up the OECD. At the OECD Council, which establishes and regulates the work as outlined in the OECD Convention, the OECD members are represented by ambassadors. The OECD’s member nations are:

1. Luxembourg
2. Korea
3. United Kingdom
4. Colombia
5. Portugal
6. Latvia
7. Estonia
8. Belgium
9. Costa Rica
10. Ireland
11. Iceland
12. Hungary
13. Türkiye
14. United States
15. France
16. Australia
17. Austria
18. Israel
19. Spain
20. Slovak Republic
21. Poland
22. Japan
23. Slovenia
24. Switzerland
25. Norway
26. Czech Republic
27. Italy
28. New Zealand
29. Finland
30. Denmark
31. Germany
32. Netherlands
33. Canada
34. Sweden
35. Greece
36. Chile
37. Mexico
38. Lithuania

The European Commission takes part in OECD activities but is not allowed to vote.

Organization for Economic Cooperation and Development Key Partners

Brazil, China, India, Indonesia, and South Africa are the OECD’s Key Partners. These world’s top economies and OECD collaborate frequently. The OECD Key Partners take part in the organization’s everyday operations, contributing insightful viewpoints and raising the importance of policy discussions. Countries that are Key Partners participate in OECD policy debates, regularly participate in OECD surveys, and are listed in statistics databases.

Organization for Economic Cooperation and Development: Regional Initiatives

Regional initiatives aid in the exchange of best practises and policy benchmarking between nations in a particular geographic area both within and between regions. They direct nations towards internationally accepted norms and bold reform agendas for increased wealth and citizen well-being. Africa, Eurasia, the Middle East, North Africa, Latin America, the Caribbean, Southeast Asia, and South East Europe are among the regions where the OECD works in collaboration with other nations.

OECD Development Center

Expert analysis on development policy is provided by the OECD Development Centre. The goal is to support policymakers in their search for ways to promote growth and enhance living standards in emerging and developing countries. It covers nations from Latin America, Asia, and Africa.

The Sahel and West Africa Club (SWAC), an international forum dedicated to advancing regional policies that would raise the economic and social well-being of people in the Sahel and West Africa, is also housed in the OECD Development Centre.

OECD Organizational Structure

The three sections of the OECD’s organisational structure are as follows:

OECD Council

The principal body for making decisions inside the OECD is the Council. The Secretary-General serves as its chair, and it is made up of ambassadors from Member nations and the European Commission. The Ministerial Council Meeting of the OECD Council takes place once a year to debate the global economic and trade environment, assess and set priorities for the work, and examine matters like the budget or the accession process.

OECD Committees

More than 300 committees, specialists, and working groups that cover practically all facets of policymaking make up the OECD. The committees provide recommendations, evaluate data and successful policies, and examine member-country policy initiatives. Members of the committee are drawn from Member and Partner nations and represent government agencies, the academic community, industry, and civil society.

OECD Secretariat

Directorates and divisions make up the OECD Secretariat, which is headed by the Secretary-General. The Secretary-General is informed by the directors. Work for the OECD is carried out by the Secretariat. In collaboration with committees, the OECD Secretariat works with decision-makers and influencers in each nation, offering insights and knowledge to help direct policymaking based on facts. On June 1, 2021, Mathias Cormann was appointed to serve as the OECD’s Secretary-General for a five-year term.

Organization for Economic Cooperation and Development Objectives

The main goals of the OECD are to boost international trade and the world economy. It offers a platform for governments from many nations to work together on solutions to shared problems. It requires working with democratic nations who share a dedication to advancing their economies and inhabitants’ general well-being.  The OECD’s main objective is to support nations worldwide in accomplishing the following:

• To boost consumer confidence in markets and the businesses that underpins them.
• Develop through innovation, environmentally sound practices, and the long-term viability of developing economies.
• Achieve stable public finances to promote long-term economic growth.
• Provide resources to assist people in developing the abilities they need to be effective.

Organization for Economic Cooperation and Development: Function and Responsibility

The OECD keeps tabs on both member and non-member countries’ economies, and the Secretariat gathers and studies data on various facets of society. Additionally, it makes use of knowledge on a range of subjects to combat poverty and avert financial instability. The OECD is essential to preserving the stability of the world economy. The OECD’s primary duties and responsibilities include:

• To develop and revise sample tax conventions that serve as a guide for dividing up taxing responsibilities among nations.
• Request a peer assessment of the member nations’ performance, in which case the performance of each particular member country is monitored by the other OECD members.
• The OECD is in charge of disseminating economic analyses, statistical databases, evaluations, and projections regarding the state of the world economy. Additionally, the OECD recently published a research analysis titled “The Long View: Scenarios for the World Economy to 2060.”
• The OECD maintains a list of nations it deems to be uncooperative tax havens and attempts to combat bribery and other financial crimes throughout the world.
• It motivates G-20 participants to push for tax reform.

Organization for Economic Cooperation and Development: Publication

The OECD produces articles on statistics, general information, and economic outlooks:

• Going for Growth: Comparing countries based on national performance is called “Going for Growth.”
• OECD Factbook – Acts as a manual for nations implementing new regulations.
• OECD Economic Outlook – Offers predictions for both member and non-member countries.

Organization for Economic Cooperation and Development: Significance

To help countries in central Asia and Eastern Europe execute market-based economic reforms, the OECD offers consultancy services and support. Additionally, it examines and reports on the effects of social policy issues, such as gender inequality, on economic growth and offers policy suggestions intended to promote growth while being mindful of environmental concerns.

Organization for Economic Cooperation and Development (OECD) UPSC

The main objective of the OECD is to support economic growth in its member nations, and they intend to continue doing so. They continue to play a significant role in raising economic efficiency and living standards around the world, even in the face of competition from conferences like the Financial Stability Forum and the G20 Summit.

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