The Organisation brings together few of the world’s advanced industrial economies to further stimulate economic progress and world trade. Formal Name of OECD is Organisation de Cooperation et de Developpement Economique (OCDE). Its headquarters is located at Paris, France.
Origin and Development
The Convention establishing the Organisation for Economic Cooperation and Development (OECD) was signed in December 1960 by 18 European countries, the US and Canada, and came into force in September 1961.The OECD replaced the Organisation for European Economic Cooperation (OEEC) set up in 1948 to coordinate efforts in restoring Europe’s economy under the Marshall Plan. The OECC was of a purely European character, with the US and the Canada as only associate members. In fact, the European membership itself was limited to Western European countries, with the USSR and Eastern European countries having refused to join. Increase in economic interdependence by the late 1950s called for a wider organisation in which the North American states could participate. Thus was born the OECD. In the subsequent years, a number of economically advanced countries became members; Japan in 1964, Finland in 1969, Australia in 1971, New Zealand in 1973, Mexico in 1994, the Czech Republic in 1995, and Hungary, Poland and South Korea in 1996.
The objectives of the OECD are “… to help member-countries promote economic growth, employment, and improved standards of living through the coordination of policy (and)… to help promote the sound and harmonious development of the world economy and improve the lot of the developing countries, particularly the poorest”.
The OECD operates through the Council, the Executive Committee, the Secretariat and several subsidiary bodies.
The principal political organ of the OECD is the Council, which consists of representatives of all the member-countries. It meets at least once a year at the ministerial level and about twice a month at the level of permanent representatives (i.e., head of national delegations). Most decisions are taken on a unanimous note. The Council frames general policy. The Executive Committee consists of 14 members elected annually by the Council to supervise the activities of the OECD. The Executive Committee normally meets once a week. The Secretariat is headed by a Secretary-General who is responsible for implementing the decisions of the Council and the Executive Committee, and presenting the annual and subsidiary budgets.
The Council is empowered to set up subsidiary organs to perform different works. The Development Assistance Committee (DAC) consists of the representatives of major OECD capital-exporting nations as well as the Commission of the EU, and is responsible for overseeing members’ official resource transfer. The DAC aims at promoting a coordinated, integrated and effective effort in international financing of sustainable economic and social development. The Economic Policy Committee, comprising senior officials of member-states, reviews economic activities in member-states. The Economic and Development Review Committee prepares annual economic surveys of individual member-countries. The Trade Committee is concerned with commercial policies and practices and specific trade problems. The Committee on International Investment and Multinational Enterprises prepared the voluntary code of conduct for multinational corporations that were adopted by the OECD in 1976. In addition, there are committees in the fields of agriculture, consumer policy, education, energy, environment, financial markets, fiscal affairs, industry, invisible transactions, manpower and social affairs, maritime transport, restrictive business practices, scientific and technological policy and tourism. There are high-level groups on commodities, positive adjustment policies, and employment of women, and an Executive Committee Group on North-South Economic Issues.
Activities Of OECD
The major role of the OECD has been the continual review of economic policies of the member-states. The Organisation is also taking efforts to combat unstable currencies, massive trade imbalances, Third World indebtedness and high unemployment in industrialized countries. Its relations with non-member countries is looked after by the Centre for Cooperation with Non-Members (CCNM) which was established in 1998 and serves as a focal point for the development of policy dialogue between the OECD and non-member economies.
The CCNM conducts multi-county thematic, regional and country programmes. The thematic programmes, which focus on specific groups of countries with common problems, include the Emerging Market Economy Forum (EMEF), the Transition Economy Programme (TEP) and the Emerging Asia Programme. There are regional programmes, either already in place or under development, for the Baltic States, South-East Europe and Latin America. Country programme focus on needs of individual countries.
The OECD is of a voluntary character; it is essentially a consultative assembly which pursues its programmes through moral persuasion, conferences, seminars and numerous publications. Even though the ultimate implementation of the Organisation’s decisions rests with each member-country and even the decisions are based on unanimity, the OECD has been successful in coordinating action in a number of areas including international trade rules, capital movements, export credits and aid to developing countries.
The OECD has also become a clearing house for a vast amount of economic data ranging from general statistics, agriculture, scientific research, capital markets and tax structures to energy resources, pollution, education and development assistance. Over 300 new titles are published annually, which constitute an extremely significant source of information on economic and related social matters.