MercoPress. South Atlantic News Agency

“Chile’s accession to OECD a major milestone”

Chile signs up as the 31st member of the OECD (Organization for Economic Cooperation and Development) and its first member in South America on January 11. For Chile, this marks recognition of nearly two decades of democratic reform and sound economic policies. For the OECD, it is a major milestone in its mission to build a stronger, cleaner and fairer global economy.

Chile has worked hard to join the OECD. In doing so, it joins an organization whose members work together to find solutions to global problems, from economic policy to climate change. As a club of countries committed to championing the highest standards in all areas of public policy, our aim is to provide the best possible education, healthcare and employment opportunities for our citizens and to help other countries do the same.

Membership of the OECD means being at the heart of designing and implementing the rules that will shape tomorrow’s global economy and society. The OECD sets global standards and common policies in such critical areas as corporate governance and corporate responsibility. Our work on education guides governments in their search for educational excellence. Our Jobs Strategy has provided a solid fundament for effective employment policies. We lead the fight against corruption through the OECD Anti-Bribery Convention that outlaws bribery of public officials in international business deals. In all these areas, we are creating the bedrock for a fair and open global economy.

As we strive to pull out of the worst economic crisis in decades, emerging, developing and advanced economies all need to work together. As new countries and regions emerge as major global players, new challenges have become apparent. From tackling climate change to handling migration flows, from forging a fair and open trading system to combating tax evasion , none of these challenges can be dealt with by individual countries on their own. Divided, we are weak. But together, we can achieve change.

Since my own country, Mexico, joined the OECD in 1994, it has benefited greatly from OECD policy advice and recommendations. Simultaneously, Mexico has been able to contribute by bringing its own insights and experience to the table, for example in such areas as biodiversity and migration. As the OECD has broadened its membership, it has become more inclusive and more sensitive to the problems of developing, as well as developed, countries and to policy issues of a societal, as well as an economic, nature.

With this shift has come awareness of the need to strengthen links with other countries around the world. Later this year, we hope Chile will be joined at the OECD by three other new members, Estonia, Israel and Slovenia. Further ahead, the OECD looks forward to welcoming Russia. In parallel, it is forging closer links with other major powerhouses of the global economy, including Brazil, China, India, Indonesia and South Africa. Together, that makes 40 countries accounting for over 80 per cent of the world economy.

Chile, with an economy that has been growing at over 5 per cent a year for the last 20 years, has long been a beacon in Latin America. It has made impressive progress in reducing poverty, even though more still needs to be done. Groundbreaking pension reforms in the early 1980s endowed it with a private pensions system that has served as a model for many other countries around the world. When the crisis hit, its prudent tax policies, including saving the revenues of the copper bonanza “for a rainy day”, gave it the financial leeway needed for stimulus measures to support demand and employment.

Since it began talks with the OECD in May 2007, Chile has taken further significant steps, introducing new laws to end the banking secrecy that provides a shield for possible tax evasion and enabling prosecutors to pursue companies suspected of bribery and corruption. Another major reform has seen the extension of public pension coverage.

Competition laws and consumer protection have been strengthened. New legislation has established a clear separation between the State and the board of copper mining company Codelco, Chile’s largest state-owned enterprise. In the private sector, a new law will boost transparency by requiring increased information for financial markets while combating misuse of insider information and reinforcing requirements for external auditors. A new National Policy on Chemical Safety is part of a drive to conform to OECD standards on environmental protection.

Such actions require dedication and strong political will, and Chile has demonstrated both. But the journey is just beginning, both for Chile and the OECD. Chile’s accession is the first in a series of steps that will see the OECD expand its global reach in order to increase its relevance and effectiveness. Our objective is to improve the wellbeing of all people around the world.

(*) OECD brings together the governments of countries committed to democracy and the market economy from around the world to: Support sustainable economic growth; Boost employment; Raise living standards; Maintain financial stability; Assist other countries' economic development; Contribute to growth in world trade.

The Organisation provides a setting where governments compare policy experiences, seek answers to common problems, identify good practice and coordinate domestic and international policies .

By Angel Gurría, OECD Secretary-General