To mark the occasion of the 50th anniversary edition of the OECD Observer, we take a brief look at how the information world and the global economy have transformed since the OECD’s first secretary-general, Thorkil Kristensen, launched the magazine in November 1962.  

Two decades ago, when the first Rio Earth Summit took place in 1992, the most advanced economies were in an economic downturn. It was not as severe as the crisis many countries have endured since 2008, but asset bubbles had burst, unemployment had risen and recovery seemed a remote prospect.

The economic outlook for 2012 is very different than it was a year ago. The cautious optimism that reigned in the first half of 2011 has faded amid renewed uncertainty about the state of the global economy and malaise about the future. The road to recovery is a difficult one, and strong leadership and resolute collective commitment to change are now needed to unblock progress in 2012. Sinking into helpless pessimism is not an option: we need to re-inject hope and confidence.

The worst economic crisis in half a century still holds us in its grip. In fact, with a bleak short-term outlook, global public opinion could be forgiven for questioning the ability of political leaders and policymakers to find a way out.

2010 started with the devastating earthquake in Haiti that killed well over 100,000 people and nearly destroyed a country. We stand in solidarity and sympathy with the people of Haiti, whose tragedy brought back memories of the tsunami just before New Year 2004. Nothing can replace the loved ones lost.

The pain and anguish of the current global economic crisis were caused by a series of massive failures in the heart of the world’s most developed countries. We are in our current fix because of an excess of financial innovation, driven by ever-increasing thirst for short-term profit.

Today, barely more than a decade after its first commercial incarnation, it is difficult to think of a policy domain that is not affected by the Internet.

The Internet and the constellation of information technologies it connects are viewed as essential ingredients in addressing some of the world's most pressing policy issues: sustainable and increasing economic growth, ageing societies, environmental management, energy efficiency, the eradication of poverty, and many more. The implications for economic and social development are far-reaching and profound, including for the next several billion users.

The OECD Anti-Bribery Convention is ten years old this year. In that short time it has established itself as the first truly effective global instrument to fight corruption in cross-border business deals. But despite enormous advances, the fight against bribery must continue. And the key to further progress depends on the resolve and willpower of OECD member countries.

I am in contact with leaders and officials both from the world’s most developed nations and from developing countries. When the Doha Development Round talks collapsed in July, I was struck by the gap between what officials say when they meet at the OECD in Paris and how they define their positions in the WTO talks in Geneva.

The OECD 50th Anniversary Week 2011 was a momentous and inspirational occasion. Against the background of a fragile recovery of the world economy, 21 heads of state and government and deputy prime ministers, 86 ministers and state secretaries, and over 2,000 participants from business, labour and civil society gathered to identify and discuss the policies needed to achieve a more inclusive and greener path to economic growth and job creation.

“[…] On behalf of the OECD, I express our profound sorrow at the enormous loss of life and extend our condolences to all those who have been affected by this terrible tragedy. At the same time, we admire the courage and resolve of the Japanese people in face of adversity, and we are confident that Japan will emerge from this disaster stronger and better.

We are celebrating the OECD’s 50^th anniversary during the tail-end of the worst financial and economic crisis of our lifetimes. It’s a good moment to take stock and to ask the right questions. Why couldn’t we avoid the crisis? Were the policies and the policy mix we promoted the right ones, and how can we adjust these polices to new realities? What is more, are we doing enough to prevent another crisis? Are our economic theories, our models and our assumptions still appropriate? How should our organisation’s work be adapted so that we continue fulfilling our founding mission of promoting better policies for better lives?

What is the state of world economy as we enter 2011? Have we made progress over the past 12 to 18 months in putting an end to the worst economic crisis in our lifetimes and laying the foundations for a stronger, cleaner and fairer world?

As the OECD reaches 50, it must continue to become more relevant, useful and open within a new architecture of global governance, argues Angel Gurría, in this extract from remarks delivered following the renewal of his mandate as OECD secretary-general.*

With austerity the order of the day in most OECD countries, the public is understandably anxious that budget cuts do as little harm as possible to the services they depend on. Few sectors capture the dilemmas this poses for policymakers quite like healthcare.

According to the latest Economic Outlook, growth in the OECD will reach some 2.7% in 2010. But while the global economy may be out of intensive care, it remains very fragile, as underlined by market volatility, rising public debt and high unemployment. A key missing ingredient is confidence. What must be done to restore it?

One of the difficult challenges for governments facing a crisis is to keep  an eye on the wider picture. This is particularly true in OECD countries  today, as they fight down unusually wide fiscal deficits and heavy debt.  These problems are a sequel to the financial crisis that started in 2008.  Now, most countries, from the largest to the smallest, have to make  new sacrifices. People are understandably angry, feeling they are not  responsible for the current situation.

Spring is finally in the air for most OECD countries, as the signs of recovery start to multiply. The recession has been long and hard, so this is reassuring news. But while the worst of the crisis may be behind us, the recovery remains fragile, and there are still many policy challenges to address.

The world is going through hard times. Though there are some signs of an economic recovery, global confidence remains fragile. From the economic and social crisis to climate change, natural disasters and conflict, rarely in modern history have we faced such a testing period.

The crisis has taught us many lessons, about our policies, our practices and our ways of life. But if there is one lesson that stands out, it is the importance of international co-operation to help us overcome the challenges we face.

Some 15 million people have joined the ranks of the unemployed in OECD countries since the end of 2007. Unemployment has already reached a record high of 8.5% as a result. Without the right policies and if the recovery fails to gain momentum, OECD unemployment could approach 10% next year. That would mean 57 million people out of work-roughly equivalent to the population of some G8 countries!

The world economy remains gripped in the deepest and most widespread economic crisis in modern times. The latest update of the OECD Economic Outlook expects GDP to plummet by an average 4.3% in the OECD area in 2009, and world economic activity to shrink by 2.7%.

Can 2009 bring a ray of light to lift the gloom and end the severest financial and economic crisis in decades?

The OECD Economic Outlook issued end-2008 sees some 21 of 30 member countries already in or heading into a recession that could last a year. Business investment will contract by over 5%, and unemployment could rise by at least 8 million by 2010. This social crisis is affecting families and communities across the planet, with emerging and developing economies suffering too.

The financial crisis sweeping world markets is the worst since the Great Depression. While the crisis is biting into the real economy, hard lessons are being learned. How should policymakers move forward, particularly as room for manoeuvre is being squeezed?

We welcome and support the adoption of the systemic rescue plan announced by the US government on 19-20 September , which will contribute to re-establish the normal operation of financial markets and preserve employment and economic activity.

The 2008 OECD Ministerial Council Meeting and Forum, the high points of the OECD calendar, could not be more timely. The issues we will be dealing with and the policy responses we will discuss should pave the way for a better world economy. Christine Lagarde, the minister of economy, finance and employment of France–the OECD’s host country–will chair the ministerial meeting.

A 50% rise in global greenhouse gas emissions by 2050, higher temperatures, with more droughts and storms harming people, crops and buildings; more animal and plant species becoming extinct under expanding farmland and urban sprawl; dwindling natural resources; a billion more people living in water-stressed areas by 2030, with more pollution, disease and premature deaths ahead.

If Shakespeare was right, and the world is a stage, then “Gathering Storm” could be the title of the play as we enter 2008. With a US economy flirting with recession, the euro area losing stamina under a strong euro, a barrel of oil close to $100, international food and commodity prices reaching record levels and climate change intensifying, it looks like we are heading into a turbulent zone.

The history of human progress is also a history of innovation, and OECD countries have been rediscovering what this means for the global economy. Consider the US. For two decades the world’s largest and most advanced economy has been driving forward the frontiers of technical progress. Yet whether in information technology, pharmaceuticals or biotechnology, the US knows it must innovate to stay in front.

For a complete list, see www.oecd.org/speeches

As political leaders gathered in Heiligendamm in northern Germany this June and before that at the OECD in Paris in May, the concern on everyone’s minds was the future shape of the global economy.

The global economy is into its fifth year of growth. The expansion enjoyed in the OECD area has benefited from the dynamism of large non-member economies, especially in Asia. Globalisation has helped these countries raise living standards and reduce poverty. Indeed, the participation of China, India and other non-OECD nations in global economic flows has been increasing at a remarkable pace, now representing around half of total world GDP (measured by purchasing power parities), about 40% of world exports and nearly half of the world’s energy consumption. They have become massive outward investors, too.

Energy has moved to the top of our policy agendas, and with good reason. First, there is the price of oil, which though easing a little in recent months, remains historically high. This has pushed up costs for producers and consumers alike.

The OECD's core mission is to help make the world economy work better, Secretary-General Angel Gurría said in a keynote address to the meeting of the Parliamentary Assembly of the Council of Europe Strasbourg, 4 October 2006. While the organisation's work is well known, stronger partnerships with parliamentarians are needed to strengthen its impact and influence, Mr Gurría said.

It is a great honour to have been given the mandate to lead the OECD following Donald Johnston’s great legacy. We are facing a number of pressing challenges, of which I will mention just a few. Starting with the global economy, I would note that although the economic outlook for this and next year is rather positive, there is no room for complacency.