OECD Forum on Green Finance and Investment Day 2: Opening Remarks

Remarks by Gabriela Ramos on the second day of the OECD Forum on Green Finance and Investment hosted at the OECD Headquarters in Paris, France on 30 October 2019.

• 

  30 October 2019 : Forum on Green Finance and Investment OECD Headquarters, Paris Photo : © HervŽ Cortinat / OECD

• 

  30 October 2019 : Forum on Green Finance and Investment OECD Headquarters, Paris Photo : © HervŽ Cortinat / OECD

• 

  30 October 2019 : Forum on Green Finance and Investment OECD Headquarters, Paris Photo : © HervŽ Cortinat / OECD

• 

  30 October 2019 : Forum on Green Finance and Investment OECD Headquarters, Paris Photo : © HervŽ Cortinat / OECD

• 

  30 October 2019 : Forum on Green Finance and Investment OECD Headquarters, Paris Photo : © HervŽ Cortinat / OECD

• 

  30 October 2019 : Forum on Green Finance and Investment OECD Headquarters, Paris Photo : © HervŽ Cortinat / OECD

• 

  30 October 2019 : Forum on Green Finance and Investment OECD Headquarters, Paris Photo : © HervŽ Cortinat / OECD

Good morning Ladies and Gentlemen,

Welcome to the second day of the 6^th OECD Forum on Green Finance and Investment. 

Yesterday, Secretary-General Gurría opened this Forum with a call to action that highlighted not just the scale of the climate emergency, but also the importance of tackling it with policies that also promote inclusion and well-being.

We have seen here in France, but also more recently in Chile, that we have to put people at the centre of all of our policy efforts, including those that are linked to reducing our dependence on fossil fuels and incentivising green growth.

The OECD has made this a priority in the last few years with groundbreaking studies like Investing in Climate, Investing in Growth, and most recently Accelerating Climate Action: Refocusing Policies Through a Well-Being Lens. There is a clear empirical case: policies that work for climate and people, also work for growth.

OECD research undertaken at the request of the German Presidency of the G20 showed that climate-compatible policy packages could increase long-run output by up to 2.8% on average across the G20 by 2050.

Financing is an important part of getting this policy mix right, and not just how we mobilize more climate finance but also how we mobilize it more effectively. We have the power to do more with our investments.

Let me begin with engaging emerging economies, which is a key area for discussion today, and in particular India and  ASEAN countries.

India has set ambitious targets of installing 175 GW of renewables capacity by 2022 and 500GW by 2030. Achieving India’s clean energy goals will require around USD 500-700 billion in investment in the coming decades.

Similarly, ASEAN has set a target of sourcing 23% of its energy from renewable sources by 2025. As a region, ASEAN’s clean energy goal requires USD 290 billion in investment through 2025.

While progress has been made in financing renewables and energy efficiency infrastructure in India and the ASEAN, an investment gap remains. Governments cannot shoulder this burden alone. Catalysing private investment requires an enabling investment environment and a pipeline of investment-grade projects.

Thus, the OECD’s new Clean Energy Finance and Investment Mobilisation Programme, which you will discuss today, aims to support selected emerging economies in Latin America, South and Southeast Asia strengthen their clean energy policies to attract private investment for through clean energy finance reviews, policy development, investor dialogues and regional peer learning.

As these economies continue to grow, we must ensure that any increase in consumption is matched with a  supply from renewable or other low carbon sources, rather than adding to the global demand for fossil fuels. This goal, alongside efforts to promote energy efficiency and energy conservation can significantly advance our progress toward a low-carbon global economy.

We are looking forward to hearing your insights, experiences and ideas on taking this forward.

Linked to this agenda is another key challenge you will be addressing today: biodiversity loss. At the request of the French G7 Presidency, we recently published a new report Biodiversity: Finance and the Economic and Business Case for Action. The picture is worrying, and a lack of sufficient financing and ambitious action is at the heart of the problem.

The OECD estimates that finance flows with the potential to harm biodiversity stand at 500 billion US Dollars per year, ten times larger than global finance flows for biodiversity conservation and sustainable use.[i]

Over the last half century, such toxic finance flows, and the interests that drive them, have helped destroy one tenth of the world’s terrestrial biodiversity and one third of freshwater biodiversity. We are on course to lose another 10% of terrestrial species by 2050.[ii]

And yet protecting biodiversity is not just about surviving, it also about thriving. Ecosystem services delivered by biodiversity, such as crop pollination, water purification, flood protection and carbon sequestration are worth an estimated USD 125-140 trillion per year, more than one and a half times the size of global GDP.

The OECD has identified key priorities to help scale up and align finance for biodiversity from all sources, public and private. For example, we need a global framework to coordinate action; remove harmful subsidies; consistent and comparable finance tracking and reporting frameworks across countries and companies. Last but not least, we need multi-stakeholder engagement to ensure a common approach for measuring and integrating biodiversity in business and investment decisions.

Key to addressing biodiversity is managing rapid urbanisation, which is also on our agenda today.

By 2050, almost 70% of the world’s population is expected to be living in urban areas.[iii] This is already bringing important environmental impacts, when you consider that cities are responsible for two thirds of energy consumption and for 70 percent of global emissions.[iv]

Cities are core for climate action, and many are actually taking the lead. Recent OECD evidence has shown that cities and regions are responsible for 64% of public investment and half of public spending in selected sectors that have a direct implication for climate change.[v]

However, action to date has been far short of the mark. Subnational climate-related spending represented just 1.3% of GDP on average over 2000-2016, while subnational climate-related investment represented around 0.4% of GDP. Public funding will not be sufficient to finance sustainable cities. We must mobilize the private sector to help finance this investment deficit. Today, you will get a chance to discuss the innovative financial instruments available for cities such as green bonds, equity funds, and land-value-capture instruments to outline concrete actions and recommendations to unlock private investment.

As you can see, the question at hand at this forum is not just how we mobilize more finance to fill key investments gaps to climate mitigation and adaptation efforts. We must go a step further, thinking critically about where and how we direct these finance flows towards strategic synergies that accelerate progress towards a low carbon future, and benefit people and planet.

Thank you and enjoy day two of the Forum.

---

[i] based on fossil-fuel subsidies and government support to agriculture that is potentially environmentally harmful

[ii] https://sustainabledevelopment.un.org/content/documents/227542019_OECD_HLPF_Submission.pdf

[iii] https://www.un.org/development/desa/en/news/population/2018-revision-of-world-urbanization-prospects.html

[iv] https://www.c40.org/why_cities

[v] The average of 30 OECD countries over the period 2000-2016. Financing Climate Futures. Rethinking Infrastructure. Case study on Financing climate objectives in cities and regions to deliver sustainable and inclusive growth

OECD Forum on Green Finance and Investment: Introductory Remarks to Keynote by Professor Mariana Mazzucato, University College London

Remarks as delivered at the OECD Forum on Green Finance and Investment at the OECD Headquarters in Paris, France on 29 October 2019.

Dear Ladies and Gentlemen,

As we come together for this annual Green Finance and Investment Forum, energy related carbon dioxide emissions are rising again, reaching unprecedented levels in 2018.

You do not need me to tell you the consequences of inaction. We need deep and ambitious policy action to mitigate and adapt to climate change, and innovation is a key part of this.

Let there be no doubt: the rate and direction of innovation will help determine our success in transitioning to a low-carbon economy. However, we have a long way to go in getting the innovation policy mix right.

The OECD’s International Energy Agency is tracking the progress of 38 critical energy technologies necessary for a global clean energy transition, including renewable power, onshore wind, solar power, transport biofuels, smart grids, and energy storage. Currently, only 4 out of these 38 technologies are on track for development and deployment.

We urgently need to scale up these efforts, and key to achieving this is to make innovation mission-oriented, and not just motivated by financial gain.

Who better to tell us about how to achieve this than Professor Mariana Mazzucato, who has led the way in putting mission-oriented innovation on the policy agenda.

Her 2013 book, The Entrepreneurial State: Debunking Public vs Private Sector Myths looks at the ‘investor of first resort’ role that the State has played in the history of technological change — from the Internet to biotech— and the lessons for a Green New Deal.

In 2016 she co-edited the book Rethinking Capitalism: Economics and Policy for Sustainable and Inclusive Growth focused on new economic thinking. I have had the pleasure of engaging with her very closely around these issues through the New Approaches to Economic Challenges initiative, which I oversee, and for which she serves on the Secretary-General’s Advisory Group for a New Growth Narrative.

Most recently, her 2018 book, The Value of Everything: making and taking in the global economy brings the debate about value back to the heart of economics, with analysis on how to ensure we are rewarding value creation over value extraction and destruction.

Mariana currently holds the Chair in the Economics of Innovation and Public Value at University College London (UCL). She is also the Director of the UCL Institute for Innovation & Public Purpose.

Mariana is the recipient of a long and prestigious list of prizes, including the Leontief prize and most recently the inaugural Not the Nobel prize, for fresh thinking in economics.

Ladies and Gentlemen, please join me in giving a very warm welcome to Mariana Mazzucato.

Inauguration of the Expanded OECD Jakarta Office

Excellencies, Ladies and Gentlemen,

It was my pleasure to inaugurate the expanded OECD Jakarta Office on 4 November 2019.

The OECD’s relationship with Indonesia has blossomed in recent years. This reflects first the country’s economic dynamism and its growing role on the world stage. President Widodo has helped deliver annual GDP growth of around 5% a year and per capita income growth of around 4% a year, with living standards continuing to rise.

This deepening engagement between Indonesia and the OECD also points to the efforts of Secretary-General Gurria to build a more inclusive and relevant Organisation.

Back in 2007, we launched the first phase of this relationship (Enhanced Engagement), which we formalised when Indonesia became an OECD Key Partner in 2012, together with Brazil, China, India and South Africa.

That same year, Indonesia and the OECD signed a Framework of Co-operation Agreement – the first such agreement for a Key Partner.

The opening of our OECD representative office in Jakarta in 2015 is a testament to our deepening engagement and friendship.

I am delighted that the office is expanding. This will help us to bring our bilateral co-operation with Indonesia to an even higher level and, we hope, act as a launchpad for our work across the whole Southeast Asian region, particularly through the Southeast Asia Regional Programme (SEARP).

Warm thanks to all those Friends of the OECD who attended the inauguration, and thanks in particular to the New Zealand Embassy for hosting.

ASEAN Business and Investment Summit 2019: Advancing ASEAN 4.0 and Global Value Chains

Heads of States and Governments, Ministers, Excellencies and distinguished guests,

I am delighted to join you for the 2019 ASEAN Business and Investment Summit. Amid growing global trade tensions and uncertainties, that are directly impacting this region, the time is right for this discussion.  

Global value chains (GVCs) and digital technologies are an essential feature of our globalised, interconnected world, and they remain a key lever to improve it.

GVC participation has in many instances been beneficial for ASEAN economies. The OECD 2020 Economic Outlook for Southeast Asia, China and India, released today, estimates that ASEAN countries will grow at a rate of 4.9% over the next five years.

[Let me take this opportunity to thank those among you that made this Outlook possible, the governments of Korea, Japan, Switzerland and more recently the European Commission.]

We are increasingly referring not only to “Factory Asia” but also “Market Asia”, as consumption is booming from a growing middle class.  

GVC integration is a part of this success story. Jobs linked to GVC participation have grown over three times faster than total employment, and firms integrated into GVCs are more productive than other domestic counterparts.

However, global integration through GVCs has also brought downsides, and these must be addressed. Growth cannot come at the expense of people or the planet. We have to ensure that companies and state actors play by the rules and uphold the highest standards.

These include the various OECD due diligence guidance tools and the OECD Guidelines for Multinational Enterprises, which are critical to ensure GVC-related operations deliver safe conditions and quality jobs with adequate wages, social protections and job certainty.

In the digital age, we also have to be more mindful about the level playing field. Trade that works for all means ensuring that firms participating in GVCs are not only the highly innovative “born global” firms, but also local firms and SMEs.

However, the Fourth Industrial Revolution is also bringing challenges. Automation has the capacity to transform global value chains; removing many of the midstream activities, such as parts assembly, that have provided jobs, skills and growing incomes to low- and mid-skilled workers.

The OECD estimates that around 14% of jobs in OECD countries are at high risk of automation and a further third will change significantly in how they are carried out.

It is likely that southeast Asia will be particularly affected. The ILO estimates that almost half of existing jobs in Southeast Asia are at risk from automation.

To benefit from GVC participation in an age of the Fourth Industrial Revolution, policymakers must be forward-thinking and proactive, and they must put people first.

I would like to present three priorities for action.

First, skills development is key, and this is why the Economic Outlook for Southeast Asia, China and India focuses on human capital development.

Currently in the OECD, 15% of adults lack basic digital skills, and 13% lack basic digital, numeracy and problem-solving skills.

Digital skills, as well as creativity, adaptability, judgment and communication skills, will have to be embedded from primary education onwards, along with measures to boost STEM, especially for girls.

The OECD is developing new tools like the PISA Global Competence Framework, but as we build these new approaches and curricula, dialogue between policymakers and the private sector on shifting skills demand will become increasingly important.

So will co-operation around the design of lifelong learning and workplace training. OECD countries are exploring incentive schemes that can help shoulder training costs for employers, as well as initiatives to boost workforce skills in recipient FDI countries.

One example is the Sino-German Automotive Vocational Education (SGAVE), which is a partnership between GIZ, German car companies, and  pilot schools based in China to foster a local talent pipeline, particularly in engineering and IT.

The second priority I want to emphasis for harnessing GVCs in the digital age is make them work for SMEs. SMEs account for 95%–99% of businesses and more than half of the total employment in all ASEAN Member States.[i] And yet they only accunt for 10% to 30% of exports. This gap indicates huge potential, but harnessing digital technologies will be key.

Yet, a recent study found that only 10% of micro, small and medium sized enterprsises (MSMEs), used advanced digital tools.[ii]

We need to do better at diffusing technology across the economy. This requires measures to address limited competition, rigid labour markets, barriers to entry and growth for successful firms, as well as restrictions on trade and investment, and a burdensome regulatory environment, all of which may hinder technology diffusion for SMEs,  and favour larger firms.

The OECD has a wide range of tools to support SMEs, from fostering productivity to accessing finance and promoting inclusive entrepreneurship. Working closely with Business at OECD (BIAC), we have also just launched  the OECD Digital for SMEs Global Initiative, to promote knowledge sharing for all stakeholders supporting SME digitalisation.

OECD countries have interesting examples to share, such as the national campaign “Made Smarter” in the UK, the “Small Business Digital Champions” in Australia, or the “SME: Digital” strategy in Denmark, all of which have worked in parternship with the private sector.

And last but not least, my third priority, a well functioning digital eco-system. ASEAN countries are making good progress. We have seen a rapid rise in mobile broadband coverage. The mobile broadband penetration rates (per 100 people) in Singapore and Brunei Darussalam were at over 100% in 2016 and 2018 respectively, and those of Malaysia and Thailand were close to 100%. Meanwhile, Cambodia, Indonesia, the Philippines, Viet Nam, Myanmar, and Lao PDR are fast approaching 50%.[iii]

But more efforts are needed to deliver comprehensive, reliable, safe and affordable high bandwidth telecommunications infrastructure.

This requires regulations and policies that are based on consistent, clear and transparent principles, and that therefore foster competition in telecom markets.

Our recent report, Southeast Asia Going Digital: Connecting SMEs, suggests that more could be done to strengthen market competition in a number of Southeast Asian countries.

Of course it’s not just about facilitating data flows at all costs. Big data solutions and AI bring vast economic and social potential, but we are the creators of these technologies and we have to shape them for good uses. We need robust rules and structures to safeguard data privacy and security and protect citizens from the risk of data theft and misuse.

Ladies and gentlemen

The message is clear: the opportunities brought by global trade and digital technologies are vast.

However, trade integration, like economic growth and like technological progress, are not ends in themselves, but a means to improving people’s lives and opportunities.

This is the lens through which all countries, including ASEAN countries, must focus their policy efforts to harness GVS in the digital age. Count on the OECD.

---

[i] Study on MSMEs Participation in the Digital Economy in ASEAN, October 2019, https://asean.org/storage/2012/05/Study-on-MSME-Participation-in-the-Digital-Economy-in-ASEAN.pdf, p2

[ii] Study on MSMEs Participation in the Digital Economy in ASEAN, October 2019,  https://asean.org/storage/2012/05/ASEAN-MSME-Full-Report-Final.pdf, p4

[iii] Study on MSMEs Participation in the Digital Economy in ASEAN, October 2019, https://asean.org/storage/2012/05/Study-on-MSME-Participation-in-the-Digital-Economy-in-ASEAN.pdf, p1

Newsletter 3-13 October 2019

Check out my newsletter for a snapshot of my recent engagements.

• 

• 

• 

• 

• 

• 

• 

• 

• 

• 

• 

  10 october 2019 – Openning Meeting of the OECD Global Parliamentary Network. Gabriela Ramos OECD Chief of Staff and Sherpa To the G20 Anthony Gooch, Director of Public Affairs and Communications Paris, France Photo : OECD / Victor Tonelli

• 

  10 october 2019 – Openning Meeting of the OECD Global Parliamentary Network. Gabriela Ramos OECD Chief of Staff and Sherpa To the G20 Anthony Gooch, Director of Public Affairs and Communications Paris, France Photo : OECD / Victor Tonelli

• 

  10 october 2019 – Openning Meeting of the OECD Global Parliamentary Network. Gabriela Ramos OECD Chief of Staff and Sherpa To the G20 Anthony Gooch, Director of Public Affairs and Communications Paris, France Photo : OECD / Victor Tonelli

Opening Remarks: OECD-SRSS Cooperation Signature Ceremony

On 16 October 2019 Gabriela Ramos, OECD Chief of Staff and Sherpa and Martin Verwey, Director General of the European Commission’s Structural Reform Support Service (SRSS), signed a document solidifying the collaboration between the OECD and SRSS at the OECD Headquarters in Paris, France.

• 

  16 October 2019 SRSS Signature Ceremony OECD, Paris Headquarters, France Photo: OECD/Andrew Wheeler

• 

  16 October 2019 SRSS Signature Ceremony OECD, Paris Headquarters, France Photo: OECD/Andrew Wheeler

• 

  16 October 2019 SRSS Signature Ceremony OECD, Paris Headquarters, France Photo: OECD/Andrew Wheeler

• 

  16 October 2019 SRSS Signature Ceremony OECD, Paris Headquarters, France Photo: OECD/Andrew Wheeler

• 

  16 October 2019 SRSS Signature Ceremony OECD, Paris Headquarters, France Photo: OECD/Andrew Wheeler

• 

  16 October 2019 SRSS Signature Ceremony OECD, Paris Headquarters, France Photo: OECD/Andrew Wheeler

• 

  16 October 2019 SRSS Signature Ceremony OECD, Paris Headquarters, France Photo: OECD/Andrew Wheeler

Ambassador Didier Lenoir, Director General Maarten Verwey, Ambassadors, Directors, Colleagues,

I am delighted to welcome you at this ceremony to seal in and celebrate our collaboration with the European Commission’s Structural Reform Support Service (SRSS). Let me in particular thank Maarten Verwey, the Director General of the SRSS and his team, Daniele Dotto, Sébastien Renaud and Ana Lope-Garcia for being with us today. We have certainly come a long way together since we met in Brussels at the end of last year to structure this cooperation. Today, we are very happy to officially join forces with the SRSS and support the European efforts to help advance a strong agenda on structural reforms.

This is a timely gathering as we witness the launch of the new Presidency of the European Commission. On that note let me mention that we are particularly proud to see the EU lead the way be electing a woman for President for the very first time, and a woman to govern the European Central Bank. The EU is walking the talk on gender equality!

The goals of the new European Commission resonate well with OECD objectives; that is to ensure that our growth models deliver for people, and for the planet. Combating climate change, achieving social justice, and dealing with the digital transformation, are objectives that bring us together.

It is my pleasure to recall that the OECD has been collaborating closely with the European Union since 1960. Our co-operation with the SRSS is in fact an extension of this collaboration and the extension of this work could not come at a better time. Joining our efforts in this way makes us stronger in a particularly complex moment. As highlighted in the OECD’s Interim Economic Outlook released in September, we must start investing more in structural reforms if we are to prevent a deeper slowdown of global growth. It is clear that, beyond macroeconomic objectives, the plan for further growth requires a strong component of structural reforms. This is also the main lesson from the financial crisis that led to the European Semester, and the OECD has been an active partner since the very beginning of the crisis, notably by working closely to support Greece. It is by working on structural reforms, which are the DNA of the OECD, that we can lay the foundations for more productive, innovative, inclusive and dynamic economies.

We are grateful for the excellent opportunity, provided by the SRSS, to have greater policy impact and to ensure more effectiveness in advancing structural reforms directly with governments on the ground. I am convinced that this co-operation is a win-win for both the EU and the OECD. It takes advantage of the support the EU has provided the OECD with for so many years, in advancing important policy agendas, most notably through its generous provision of Voluntary Contributions. This partnership leverages the investment made by the EU in the OECD until now, which should ensure a high rate of return for our European Members!

It is with great pleasure that I announce that the grant agreement we are sealing in today comprises 34 projects in 18 EU countries! These projects will lead to improved labour markets, education systems, innovation, governance, environmental protection and you name it. To mention only a few of these ambitious projects, we will for example be supporting the Czech authorities with the preparation of a new national circular economy strategic framework, developing a new National Basic Skill Strategy in the Netherlands and improving the provision of labour market services in Estonia and Slovenia.

I am delighted to tell you that we have received much positive feedback on this co-operation, both from our partners in national administrations and from our counterparts at the SRSS. This feedback confirms the quality and relevance of OECD support to delivering on government reform priorities.

Let me take this opportunity to thank our Ambassadors for their positive reception of this co-operation. Each project contributes to advancing national reform programmes by capitalizing on the cutting-edge skills and human capital developed in this house. The OECD is contributing with the best of our talent, as represented also by our experts present here today. Therefore, I extend my gratitude to Directors, counsellors, project managers, experts and corporate services staff for contributing to the success of this initiative.

Ladies and Gentlemen,

In a geopolitical environment where we are witnessing an ever-weakening commitment to multilateralism, collective efforts such as those fostered by the OECD-SRSS partnership are our best response. I believe that by delivering on this co-operation, we can prove that even the most important national priority can benefit immensely from international cooperation. Together we must aim to ensure multilateralism’s survival and success and I can assure you that the OECD, as a results oriented do-tank, remains committed to these goals!

Finally, we support and encourage the ambitions of the new European Commission to further reinforce its reform support programme and we will do our best to continue delivering as a constructive, trustful and engaging partner.

Dear Maarten, SRSS colleagues and Ambassadors please count on us, count on the OECD!  Thank you!

Closing Remarks: State-Owned Enterprise Anti-Corruption Day

Closing remarks delivered at the State-Owned Enterprise Anti-Corruption Day hosted at the OECD headquarters in Paris, France on 16 October 2019.

Ambassadors, Committee Chairs, distinguished guests,

I would like to begin by thanking you for joining us for the OECD State-Owned Enterprises Anti-Corruption day. The Recommendation of the Council on Guidelines on Anti-Corruption and Integrity in State-Owned Enterprises (or ‘ACI Guidelines’ as we call them) was adopted by Ministers in May. We are here to advance the all-important process of ensuring successful implementation.

Now is when the work really begins, because as our Secretary-General likes to say, agreements make the headlines, but implementation is what changes people’s lives.

SOEs are critical for our economies and societies – they are the main channel for states to exercise their roles as economic actors, and in many instances they help deliver essential services to the public.

They are often concentrated in sectors of strategic importance for government and society, like energy, water and transport.

Today SOEs account for over a fifth of the world’s largest companies and many are increasingly being operated like private firms. Their role as global competitors is growing as the boundaries of markets extend beyond geographic borders.

Unfortunately, the presence of SOEs in the global marketplace has also been marked by certain high-profile scandals and some instances of corruption. As we heard earlier today, the majority of bribes promised or given to foreign public officials between 1999 and 2014 were destined for SOE officials.

But it’s not only an issue of cross-border activity. The challenge is also at the regional, national and local levels.

A recent report by Transparency International shows that almost a fifth of citizens in 18 Latin American counties had to pay a bribe to utility services in the last year (second only to the police force).[1]  And we know that SOEs are big players in utilities sectors.

When mismanagement, abuse or corruption occurs in SOEs, the costs to society and to trust in both the private and public sectors can be great.  We have seen how some SOE-related scandals can lead to democratic unrest and slides in the corruption perceptions’ index.

Today marks the latest stock-take in years of exploration on what makes SOEs susceptible to corruption and how policy makers can act to raise their integrity.

The Guidelines will help address this challenge. For example, to help insulate SOEs from undue influence in their operations, the Guidelines recommend safeguards for the autonomy of boards and merit-based appointment of SOE decision-makers (including CEOs). To avoid impunity of SOEs and bring accountability, the Guidelines expect SOEs to have annual external audits and that auditors report on any irregularities.

Integrity is an ethical imperative and a key driver of trust, but it is also an economic case, since integrity is vital to ensure high performing productivity and returns on public investments.

The Guidelines, which complement the OECD Guidelines on Corporate Governance of State-Owned Enterprises, are rooted in the idea that no state owner or company can fully succeed in improving SOE integrity by ‘going it alone’. A broad range of actors need to be on board, and their incentives aligned.

This is why the ACI Guidelines were developed by three Working Parties: the Working Party on State Ownership and Privatisation Practices in collaboration with the Working Group on Bribery in International Business Transactions and the Working Party of Senior Public Integrity Officials.

All three are represented here today, in addition to a broad range of participants from private firms, from governments, including OECD national delegations, from academia, from civil society, and of course from TUAC and BIAC.

This meeting is all about ‘kicking-off’ the implementation process, and you have brought very good insights and examples to nourish the discussion and chart the path forward:

• We have heard this morning directly from various branches of government on how owners can and should lead by example on integrity;

• We have shared our challenges, our best practices and reforms on getting ownership and governance arrangements right;
• We have learnt from both private firms and SOEs which company-internal structures and mechanisms best promote integrity and prevent corruption;
• We have explored how accountability is maintained and what to do if things go wrong;
• We have taken a deep dive into the particular challenges of high-risk areas like the extractives sector; and;
• Last but not least, we have  gathered new partners to help put into practice all of what we have shared, with exciting new initiatives like the piloting of an expert secondment programme: Compliance Without Borders [the idea was born in the B20].

The most important thing is that we continue to advance together in the collaborative and multilateral spirit in which the Guidelines were conceived.

As the OECD’s Sherpa to the G20, I am proud that the ACI Guidelines were elaborated from a G20 consensus. Under last year’s Argentinian Presidency, the G20 Anti-Corruption Working Group adopted a set of High-Level Principles on Preventing Corruption and Ensuring Integrity in State-Owned Enterprises, to which the OECD was a key contributor.

We are there to work together with states to identify quick wins but also to accompany you for the long road ahead.  We invite you to tap into our regional networks where governments identify common challenges and good practices in promoting corporate governance and integrity in the companies they own.

Today was an important gathering to take stock and strengthen implementation capacity, but we will continue providing opportunities to exchange on these important topics.

I ask you to pencil in the next key data – the OECD’s Global Anti-Corruption and Integrity Forum on 25-26 March. The subject is “Public, private and beyond”, which is the perfect platform to take this work forward.

Ladies and gentlemen,

Your presence here demonstrates that we have the commitments necessary to drive progress. And thanks to today’s meeting, we have a host of good practices and consultation partners that can help feed into an accompanying ‘Implementation Guide’ planned for 2021.

So let’s keep up the momentum and the commitment as together we embark on the implementation phase of this critical tool for integrity and for the public good.

Thank you.

---

[1] See Transparency International’s Global Corruption Barometer survey of over 17,000 people across 18 countries, conducted between January and March 2019. Available at:  https://www.transparency.org/files/content/pages/2019_GCB_LatinAmerica_Caribbean_Full_Report.pdf.

Global Parliamentary Network Meeting 2019: Inclusive Growth and Sustainable Development: Making progress towards achieving the SDGs

Keynote delivered at the OECD Global Parliamentary Network meeting on 10 October 2019 in Paris, France, convening over 100 MPs and parliamentary officials from 34 countries. Keynote opened the session on “Inclusive Growth and Sustainable Development: Making progress towards achieving the SDGs.”

10 october 2019 – Openning Meeting of the OECD Global Parliamentary Network. Gabriela Ramos OECD Chief of Staff and Sherpa To the G20 Anthony Gooch, Director of Public Affairs and Communications Paris, France Photo : OECD / Victor Tonelli

Parliamentarians, Ladies and Gentlemen,

The SDGs are the most ambitious, challenging and complex policy agenda that the global community has ever undertaken. We have made some pregress, but felivering on the central promise of the 2030 Agenda “to leave no one behind” means that at least 730 million people, or 10% of the global population, still need to be lifted out of extreme poverty by 2030.

Today, not only do we face a daunting task, but we are running out of time to finish the job. With little over 10 years to go, progress is uneven across both targets and countries.

Globally, we are not on track. The number of hungry people in the world is back up to where it was nearly a decade ago, and in fact world hunger has risen for the third year in a row.[i] Millions of children are missing out on education, especially girls. It is estimated that 16% of students of lower secondary school age do not attend school, and for girls it’s 20% – 1 in 5![ii]

On the environment, the outcomes are alarming. After a three-year plateau from 2014 to 2016, energy-related carbon dioxide emissions are rising again, reaching unprecedented levels in 2018. In just fifty years, we have destroyed one tenth of the world’s terrestrial biodiversity and one third of freshwater biodiversity. We are on course to lose another 10% of terrestrial species by 2050.[iii]

The most recent edition of the OECD’s report ‘Measuring the Distance to SDG Targets’, shows that OECD member countries need to ramp up their efforts. More than half of our members have made little or no progress towards targets relating to Eradicating Poverty, Ensuring Food, Education, Reducing Inequalities and on strengthening Institutions. And when it comes to Goal 8 on ‘Promoting Sustained, Inclusive and Sustainable Economic Growth, Full and Productive Employment and Decent Work for All’, a third of OECD countries is actually moving away from the SDG targets.[iv]

10 october 2019 – Openning Meeting of the OECD Global Parliamentary Network. Gabriela Ramos OECD Chief of Staff and Sherpa To the G20 Anthony Gooch, Director of Public Affairs and Communications Paris, France Photo : OECD / Victor Tonelli

Inequalities in many OECD countries are actually rising. The richest 10% in the OECD used to earn seven times more on average than the poorest 10% thirty years ago – this number is now 9 and a half times. The figures for wealth are even more striking, with the top 10% accounting for about one half of the total wealth in OECD countries.

As the OECD’s work on inclusive growth shows, this is not only about income and wealth, but also about opportunities and outcomes. People at the bottom accumulate disadvantages all throughout their lifetime, leading to shorter, less healthy, less fulfilling lives which they are not empowered to improve.

The OECD’s Broken Social Elevator report shows that it would take a child born into a low-income family around 5 generations – or up to 150 years – to reach the average level of income. This is not social mobility, the machine is totally broken, and it happened on our watch.

With the emergence of new technologies and automation, the lowest paid and the least educated will be hit the hardest, both in terms of the displacement and the outdated social protections. So this situation is only going to get worse, and the inclusive growth agenda becomes even more urgent.

We are already seeing the anger from people, which is manifesting itself in terms of dangerous political outcomes, and you do not need me to tell you because you as parliamentarians are on the frontline.

We need to change our approaches, and put people at the centre. To support countries the OECD has developed a wide range of tools, including the Framework for Policy Action on Inclusive Growth, which provides a dashboard of indicators and tailored recommendations to invest in people, regions and businesses that are lagging behind.

10 october 2019 – Openning Meeting of the OECD Global Parliamentary Network. Gabriela Ramos OECD Chief of Staff and Sherpa To the G20 Anthony Gooch, Director of Public Affairs and Communications Paris, France Photo : OECD / Victor Tonelli

We are also putting inclusion at the core of our work to tackle climate change, as there are so many synergies, from public health to quality jobs that will be essential for ensuring a just and inclusive transition to the low-carbon economy, as we set out in the report we launched at the United Nations General Assembly just two weeks ago.

When thinking about inequalities, including with relation to new technologies, as well as the well-being lens, we also have to keep the gender lens sharply in focus, in line with the OECD’s Gender Strategy. This is a subject very close to my own heart and, despite some progress, the situation is really concerning.

Women and girls are particularly exposed to poverty and being victims of inequality: 330 million women and girls live on less than 2 dollars a day globally, which is 4.4 million more than men. We still have hundreds of millions of girls not in school and also facing violence and discrimination.

Tackling these barriers and injustices, while also supporting women to fulfil their full potential is really one of the most important tools to advance all the SDGs. And there are win-win policies which are core for the OECD’s Gender Strategy, like investing in childcare and education, particularly between the ages of 0-3, and promoting dual parental leave, which can also help tackle harmful gender stereotypes.

The key message I want to leave you with is that we have to take this cross-cutting and interconnected approach to every single one of the SDGs. As policymakers, this is where your power to support the SDG agenda really lies, and the OECD stands ready to work with all of your countries.

The OECD’s SDG Action Plan supports our Members, partners, and the international community on making progress on the 2030 Agenda, both by measuring the distance to the SDGs and by bringing the policy tools to catch up. One of the pillars of the action plan is to upgrade the OECD’s support for integrated planning and policymaking at the country level and provide a space to share experiences on governing for the SDGs.

In this way, we have supported Slovenia and the Slovak Republic in the development of their whole-of-government national strategies for SDG implementation. In addition, we are currently working with Malta on their SDG-aligned National Development Plan.

It is clear that the institutions underpinning public administrations need to be more responsive to today’s challenges, and as parliamentarians, this is in part your responsibility.

The OECD is ready to help. Our recent report ‘Governance as an Accelerator of the SDGs’ shows a number of shortcomings in current governance practices. We see, for example, that the SDGs are not yet integrated in core governance mechanisms, such as budget and public procurement systems. Indeed, while the SDGs are often integrated in national strategies, less than half of OECD countries specifically include SDG reporting in their budgets.

We know from gender budgeting and from green budgeting how powerful this approach can be.  

It is also clear that we need to strengthen the coordination between different levels of government. Close to two-thirds of the targets underlying the 17 SDGs – at least 100 out of 169 – will not be reached without engaging local and regional governments. Cities and regions have a crucial role to play, and the OECD’s Programme on promoting a Territorial Approach to the SDGs can help align national, regional and local initiatives.

Only two weeks ago we made an important step forward by launching in the margins of the United Nations General Assembly in New York the Global Hub on the Governance for the SDGs. This will provide a useful resource on planning, budget, procurement, monitoring and evaluation processes, to better align priorities and to enhance transparency and accountability for the SDGs. In short, improving governance for the SDGs will, we hope, rapidly accelerate progress.

And this must, of course, come hand in hand with efforts to improve financing for the SDGs. The annual funding gap still stands at a staggering 2.5 trillion US dollars. ODA will account for just a small proportion of this, which is why the OECD is leading the way with tax transparency measures like the BEPS initiative, and targeted programmes like Tax Inspectors Without Borders.

The private sector also has its part to play in this effort, not just by paying tax (though that’s a good start), but also through new business models and tools like Blended Finance and Impact Investment.

The good news is that many companies have realised that their responsibility lies beyond their shareholder profits alone, and that they have a role to play in improving society.

Working with the French Presidency of the G7, the OECD has created the Business for Inclusive Growth Platform that brings together 34 companies with more than 3 million employees worldwide and global revenues topping $1 trillion.

They have pledged to take concrete  actions to deliver on the Sustainable Development Goals, particularly goals 1 (no poverty), 5 (gender equality), 8 (decent work and economic growth), and 10 (reduced inequalities). The OECD is helping the companies launch and develop projects, and we will be monitoring their results closely and publicly every three years.

Ladies and Gentlemen,

I have enjoyed sharing with you some examples of how the OECD can support your countries to deliver on the SDGs and on the inclusive egrowth agenda.

However, this Network is also about you, and sharing your diverse experiences, so I very much look forward to hearing your perspectives and learning from you. Thank you.

---

[i] https://www.wfp.org/publications/2019-state-food-security-and-nutrition-world-sofi-safeguarding-against-economic

[ii] https://sustainabledevelopment.un.org/content/documents/227542019_OECD_HLPF_Submission.pdf

[iii] https://sustainabledevelopment.un.org/content/documents/227542019_OECD_HLPF_Submission.pdf

[iv] https://sustainabledevelopment.un.org/content/documents/227542019_OECD_HLPF_Submission.pdf

DOC Rhodes Forum 2019: Leaders Club Meeting on the Role of Civil Society: Ascending or Descending?

Session 2: Civil Society and Protest in the Digital Age

DOC Leaders Club Meeting on 11 October 2019 in Rhodes, Greece, chaired by Vladimir Yakunin, Chairman of the Supervisory Board, DOC Research Institute, featured two discussions surrounding the theme of “Role of Civil Society: Ascending or Descending?” Gabriela Ramos intervened in the second session entitled “Civil Society and Protest in the Digital Age.”

Ladies and Gentlemen,

Promoting people-centered policies for sustainable development and inclusive growth is impossible without the input of civil society.

Unfortunately, in the last decade we have observed a global shrinking of civic space. In too many countries, the freedom of citizens to protest, mobilise, and speak out is being contested and restricted.

Data from 2018 tells us that more than 3 billion people live in countries where civic space is repressed or closed. Last year the CIVICUS Monitor reported 109 countries having closed, repressed or obstructed civic space.[1]

But increasing government pressures and surveillance are not the only factors changing the landscape of civil society action.

The digital age has transformed how governments, citizens, and civil society interact and how protesters voice their discontent.

Connectivity, rapid information exchange and social media offer new ways for civil society coalitions to form beyond national borders and for citizens to stay informed, engage more actively in the policy-making process, and organize themselves to start protest movements – we saw this with the #MeToo movement, and the use by the yellow vest movement of Facebook.

There is some evidence that this could be contributing to increased political engagement. According to The Economist Intelligence Democracy Index 2018, political participation is the only category in the Index to register an improvement in comparison to previous years.

This could indicate that while citizens and civil society are disillusioned with formal political institutions, protest movements and other forms of political participation are growing.

Unfortunately, some of these gains are being made by populist and even extremist parties, who exploit new digital possibilities to amplify their reach and spread propaganda. However, these channels can also be used for good – like raising awareness around climate change and mobilizing the kids strike.

However, in some cases, online platforms and the growing capabilities of AI and big data analytics are being misused to propagate, tailor, and target misinformation. This has diverse aims, but they range from dividing societies, influencing opinions and election outcomes, securing economic gains, and recruiting intelligence sources.[2]

Additionally, confirmation bias combined with the algorithms curated by platforms to more accurately tailor content and advertising to their users, form echo chambers that can polarize political opinions and often lead to misinformation.[3]

Lastly, lack of regulation surrounding data privacy, contributes to its misuse as a surveillance tool. According to the NGO Access Now, governments forced over 196 internet shutdowns in 2018.

In the face of the digital transformation, we must mobilize digital technology to counter the  threats to civic space, while minimizing the risk that it undermines the integrity of civil society work.

Thus, building on its work on Open Government and the recently adopted Recommendation of the Council on Open Government, the OECD has established its Observatory for Civic Space, with support from the Ford Foundation.

It aims to monitor the legal, institutional and policy frameworks in which civil society organisations operate; promote and protect civic space; and act as a platform for dialogue between key civil society actors.

The Observatory will conduct a Global Survey of Civic Space, to provide a strong evidence base and data on the status of civic space and civic engagement. This initiative aims to guide and inform policy-making surrounding civil society as it continues to face increasing pressures and attempt to capitalize on the potential of the digital transformation.

Thank you

---

[1] https://www.oecd-ilibrary.org/docserver/dcr-2018-11-en.pdf?expires=1570553051&id=id&accname=guest&checksum=9C085A3707FE31CDE1EC3AC2298A7600

[2] OECD (2019), An Introduction to Online Platforms and Their Role in the Digital Transformation, OECD Publishing, Paris, https://doi.org/10.1787/53e5f593-en

[3] Ibid.

Dialogue of Civilisations: Rhodes Forum 2019

Opening Plenary: 30 Years After the Fall of the Berlin Wall: In search of a roadmap and a compass

Remarks given on the Opening Plenary of the Dialogue of Civilisations on October 11 in Rhodes, Greece. Gabriela Ramos intervened alongside Martin Schulz, former President of the European Parliament; Vyachslav Nikonov, political analyst; Dr. Huiyao Wang, Founder and President of the Center for China and Globalization; Shada Islam, Director for Europe & Geopolitics at Friends of Europe; Alphons Kannantham, Member of the Indian Parliament and former Union Minister.

Ladies and Gentlemen,

In this beautiful island, the challenges and divisions fragmenting our world seem very far away.

And yet, we are reminded everywhere here of the reality that civilisations collapse (NAEC conference).

The reality is that politically, economically, environmentally, the systems that govern our lives are under enormous strain.

Deglobalisation is bringing huge costs

The fall of the Berlin Wall was an event that signalled the dawn of global integration.

Between 1991 and 2017 global trade volume quadrupled. The growth of global exports in business services and financial services grew by five times, and manufacturing tripled.

Emergence of global value chains: the OECD has estimated that 40% of jobs in the OECD area are dependent on foreign trade. Almost 5 million jobs in the US are dependent on trade with Mexico.

40% of the content of US imports of goods from Mexico consists of US value added content.

OECD has been key in mapping this w/TiVA.

What we are seeing now is an attempted deglobalising and protectionist trends.

According to OECD Economic Outlook global growth will slow to 2.9% in 2019 and 3% in 2020: weakest annual growth rates since the crisis.

Labour productivity growth has not risen above 1% since the crisis.

Trade tensions and protectionist policies are bringing terrible consequences:

• Trade growth has collapsed below 1%.
• New trade restrictions in G20 countries in 2nd half of 2018 affected almost 500 billion US dollars of imported products.
• In G20 countries aggregate investment growth has dropped from 5% at the start of 2018 to only 1% in the first half of 2019.
• Global industrial production has fallen below 2%. In Germany it has dropped almost 10 percentage points to around -5% in 2019!
• The OECD estimates that the impact of US-China trade restrictions could lower global GDP by 0.7 percentage point per year in the first two years of the shock and global trade growth by close to 1½ per cent per year, with the effects felt all over the world.

Economic trends combined with inequalities are eroding trust and fuelling anger

Over the last 30 years, despite deepening global integration, inequality has risen in many countries, meaning the benefits of global growth have not been shared fairly.

• The richest 10% used to earn seven times more than the poorest 10% in the OECD, this ratio is now around nine and a half times.
• In the United States, for example, the share of the top 1% has almost doubled from about 11% to 20% and almost half of all income growth accrued to this group.
• Median incomes have not followed suit. Over the last 30 years median incomes in the OECD increased a third less than the average income of the richest 10%.
• Inequality of wealth is even more pronounced: the top 10% holds half of total wealth while the bottom 40% holds only 3%.
• Economic inequalities translate into social divides, with compounded effects: by the age of 15 disadvantaged pupils in the OECD have fallen on average two-and-a-half years behind their more affluent peers.

All these factors have driven down trust: In the OECD only 43% of citizens trust their government.

There is also not enough progress tackling gender divides: pay gap is still 14% in OECD, and women spend double the amount of time in unpaid work.

The ILO estimates that globally 606 million women, or 41% of those currently inactive, are outside the labour market because of their unpaid care responsibilities.

Our growth model has left people behind but also created an environmental emergency

Emissions have started to rise again, reaching unprecedented levels in 2018. We are not on track to reduce warming to below 1.5 degrees, our kids are striking, the Amazon is burning, our oceans are being suffocated by plastics.

By the middle of the century, there will be more plastic than fish in the oceans, by weight.

Scientists warn that a million plant and animal species face extinction while the health and security of billions of people are at risk.

By 2025 half of the world’s population will be living in water-stressed areas.

The OECD has estimated that outdoor air pollution could cause 6 to 9 million premature deaths a year by 2060.

There is also anxiety around megatrends like digitalisation, which could deepen inequalities

The OECD estimates that around 14% of jobs are at high risk of automation, and another 32% will be changed significantly, with the low-skilled and low-paid most at risk.

Yet low skills workers are, on average, 40 percentage points less likely than high-skilled adults to participate in training.

Middle-skill occupations are disappearing fast.  On average in 21 OECD countries with data, the years between 1990 and 2010 saw middle-skill occupations losing 8% employment share.

We are also seeing emergence of non- standard jobs, particularly in the platform economy. These workers are up to 50% less likely to get income support when out of work.

It’s not just about social costs, there are also anxieties around concentration at the top: only 250 firms globally generate 70% of R&D and patents, and 44% of trademarks. All too often, they are also not paying their fair share of tax.

We need to reshape the foundations of multilateralism and put people at the centre

The OECD is advocating people-centred growth (we have the Policy Framework for Action on IG, Gender Strategy, PISA, Well-Being Framework, SDG Action Plan & Governance Hub) and we have NAEC.

We have the Going Digital Project & AI Principles.

We are also creating synergies between climate action and well-being (quality jobs, health, skills)

We are tackling tax evasion and avoidance, with BEPS and Automatic Exchange of Information (95 billion euros in additional revenues).