Tackling global challenges and the OECD

With the world economy today experiencing turbulence on a number of diverse fronts, OECD countries are preoccupied with meeting these challenges.

Among these are concerns for the future of the world economy stemming from the sub-prime mortgage blowout, climate change, high oil and food prices, and even the risk of falling short of achieving the Millennium Development Goals (MDGs) in the fight against poverty.

The G8 Summit meeting, to be held in Toyako Hokkaido in Japan on 7-9 July, will constitute one of the most important attempts to address these issues. On the agenda for discussion during the summit meeting are world economy, environment, climate change, development and Africa, as well as political issues.

Against the backdrop of the subprime mortgage problem and the dramatic surge of petroleum prices, the slowdown of the world economy is already apparent. The development of new financial techniques and the lack of effective risk management have resulted in the rapid spread of risk through securitisation. We need to enhance the stability of the international financial system through such measures as improving risk disclosures of financial institutions and reviewing the role of credit ratings.

To tackle the financial market turmoil, useful lessons may be drawn from Japan’s painful experience upon the bursting of its own “bubble” economy. The first of these is that a swift response is absolutely imperative. Second, it is critical to nip potential credit crunches in the bud. In this regard, I welcome the efforts of the financial authorities to analyse the causes of the recent turbulence in the financial markets and the oil price hike, as well as examining medium and long-term measures.

Soaring food prices are another concern affecting the global economy. The world’s most vulnerable populations face an increasing threat of hunger and malnutrition. A wide range of people in a number of countries are now affected by the high prices, bringing about social unrest. Emergency humanitarian relief must be coupled with a more long-term socio-economic development perspective. It goes without saying that the situation seriously jeopardises the prospects of achieving the MDGs. I believe a strong sense of urgency must accompany this discussion at the Hokkaido Toyako Summit. In response to this problem, Japan decided to provide emergency food aid of about US$100 million through the World Food Programme this April. Japan had already disbursed about $68 million to the WFP in 2008.

Climate change will be a top priority at the G8 Toyako Summit. Last year, Japan proposed the “Cool Earth 50” initiative, calling for a halving of global greenhouse emissions by 2050. I also proposed the “Cool Earth Promotion Programme” at the World Economic Forum this January, which consists of three parts.

First, on the post-Kyoto framework, I am calling on the United Nations to examine strategies and measures to bring about a peaking and halving in greenhouse gas emissions. To ensure the peaking-out of the emissions, it will be critical to create a mechanism in which everyone participates, including all major emitters.

Second, on international environment co-operation, I proposed to set a global target of 30% improvement of energy efficiency by 2020. Japan will also establish a new financial mechanism, the “Cool Earth Partnership”, on the scale of US$10 billion to assist developing countries in achieving both emissions reductions and economic growth.

Third, on innovation, Japan will accelerate development of technologies such as coal-fired power plants with zero CO2 emission, low-cost, high-efficiency solar power generation, etc.

The OECD is one of the best and largest “think tanks” in the world. It can make a significant contribution to the international community as it tackles the challenges now confronting us. It has a long and outstanding record at analysing crosscutting issues. Climate change is not simply an economic issue; it also involves technology diffusion and development and broadly impacts on individuals’ lifestyles. I hope the OECD can provide us with a well-balanced analysis based upon a realistic assessment of the cost and benefits of various policy measures to reduce CO2 emission.

The 2008 OECD Ministerial Council Meeting will also discuss organisational issues, such as enlargement, Enhanced Engagement and financial contributions. In the era of globalisation, the above-mentioned challenges can no longer be effectively managed by OECD countries alone. In this sense, it is of great importance for the OECD to strengthen co-operation with non-member economies through outreach and Enhanced Engagement.

A few years ago, Japan asked the following question at the OECD Ministerial Council Meeting regarding the future of the OECD: “Today, the OECD stands at a crossroads. Will it become an international organisation with a truly global influence?” If the organisation is to meet the expectations of the OECD countries and the global community, I believe that the only possible answer must be an unqualified “yes.”

For more on the G8 Summit, see www.g8summit.go.jp/eng/

The prime minister’s home page is at http://202.232.58.50/

Visit www.oecd.org/Japan

See also www.oecd.org/g8

©OECD Observer No 267 May-June 2008




Economic data

E-Newsletter

Stay up-to-date with the latest news from the OECD by signing up for our e-newsletter :

Twitter feed

Suscribe now

<b>Subscribe now!</b>

To receive your exclusive print editions delivered to you directly


Online edition
Previous editions

Don't miss

  • “Nizip” refugee camp visit
    July 2016: OECD Secretary-General Angel Gurría visits the “Nizip” refugee camp, situated between Gaziantep and the Turkish-Syrian border, accompanied by Turkey’s Deputy Prime Minister Mehmet Şimşek. The camp accommodates a small number of the 2.75 million Syrians currently registered in Turkey, mostly outside the camps. In his tour of the camp, Mr Gurría visits a school, speaks with refugees and gives a short interview.
  • OECD Observer i-Sheet Series: OECD Observer i-Sheets are smart contents pages on major issues and events. Use them to find current or recent articles, video, books and working papers. To browse on paper and read on line, or simply download.
  • Queen Maxima of the Netherlands gives a speech next to Mexico's President Enrique Pena Nieto (not pictured) during the International Forum of Financial Inclusion at the National Palace in Mexico City, Mexico June 21, 2016.
  • How sustainable is the ocean as a source of economic development? The Ocean Economy in 2030 examines the risks and uncertainties surrounding the future development of ocean industries, the innovations required in science and technology to support their progress, their potential contribution to green growth and some of the implications for ocean management.
  • OECD Environment Director Simon Upton presented a talk at Imperial College London on 21 April 2016. With the world awash in surplus oil and prices languishing around US$40 per barrel, how can governments step up efforts to transform the world’s energy systems in line with the Paris Agreement?
  • Happy 10th birthday to Twitter. This 2008 OECD Observer interview with Henry Copeland said you’d do well.
  • The OECD Gender Initiative examines existing barriers to gender equality in education, employment, and entrepreneurship. The gender portal monitors the progress made by governments to promote gender equality in both OECD and non-OECD countries and provides good practices based on analytical tools and reliable data.
  • Once migrants reach Europe, countries face integration challenge: OECD's Thomas Liebig speaks to NPR's Audie Cornish.

  • Message from the International Space Station to COP21

  • COP21 Will Get Agreement With Teeth: OECD Secretary-General Angel Gurría on Bloomberg

  • The carbon clock is ticking: OECD’s Gurría on CNBC

  • If we want to reach zero net emissions by the end of the century, we must align our policies for a low-carbon economy, put a price on carbon everywhere, spend less subsidising fossil fuels and invest more in clean energy. OECD at #COP21 – OECD statement for #COP21
  • They are green and local --It’s a new generation of entrepreneurs in Kenya with big dreams of sustainable energy and the drive to see their innovative technologies throughout Africa. blogs.worldbank.org
  • Pole to Paris Project
  • In order to face global warming, Asia needs at least $40 billion per year, derived from both the public and private sector. Read how to bridge the climate financing gap on the Asian Bank of Development's website.
  • How can cities fight climate change?
    Discover projects in Denmark, Canada, Australia, Japan and Mexico.
  • Climate: What's changed, what hasn't, what we can do about it.
    Lecture by OECD Secretary-General Angel Gurría, hosted by the London School of Economics and Aviva Investors in association with ClimateWise, London, UK, 3 July 2015.

  • Climate change: “We should not disagree when scientists tell us we have a window of opportunity–10-15 years–to turn this thing around” argues Senator Bernie Sanders.

  • In the long-run, the EU benefits from migration, says OECD Head of International Migration Division Jean-Christophe Dumont.
  • Is technological progress slowing down? Is it speeding up? At the OECD, we believe the research from our Future of ‪Productivity‬ project helps to resolve this paradox.
  • Is inequality bad for growth? That redistribution boosts economies is not established by the evidence says FT economics editor Chris Giles. Read more on www.ft.com.
  • Catherine Mann, OECD Chief Economist, explains on Bloomberg why "too much bank lending can slow economic growth".
  • Interested in a career in Paris at the OECD? The OECD is a major international organisation, with a mission to build better policies for better lives. With our hub based in one of the world's global cities and offices across continents, find out more at www.oecd.org/careers .

Most Popular Articles

Poll

What issue are you most concerned about in 2016?

Unemployment
Euro crisis
International conflict
Global warming
Other

OECD Insights Blog

NOTE: All signed articles in the OECD Observer express the opinions of the authors
and do not necessarily represent the official views of OECD member countries.

All rights reserved. OECD 2016