Organisation for Economic Co-Operation and Development

Created in 1961, the Organisation for Economic Cooperation and Development (OECD) is a forum where advanced industrialized democracies seek to promote cooperative solutions to the world's economic and social problems. To this end, the OECD (a) collects, analyzes, and disseminates data; (b) provides a setting where officials from national governments can meet to exchange ideas and experiences; (c) promulgates codes and standards of best practice across a whole spectrum of policy areas including inter alia, the environment, trade, taxation, investment, tourism, energy, employment, and development (member states are expected and nonmember states are encouraged to comply with these directives); (d) undertakes ongoing surveillance and periodic peer review to ensure members are adhering to the OECD's strictures; and (e) facilitates the work of other international organizations, principally the WTO and the G7, through the provision of analytical and ideological support and acting as a venue where states can prenegotiate or resolve issues that are proving intractable in larger multilateral institutions. In recent times, the OECD has shown some ambition to become a standards [Page 639]enforcer. These intentions have been thwarted by the absence of any coercive instruments available to the OECD and challenged as both illegal and illegitimate.

The OECD was erected on the foundations of its predecessor, the Organisation for European Economic Co-operation (OEEC). The OEEC was founded in 1948 to administer the Marshall Plan and won acclaim for helping to restore the health of the postwar European trading system through dismantling quantitative barriers and providing credit facilities through the European Payments Union (EPU). However, by the late 1950s it was decided that a new transatlantic organization was required where industrialized states could meet on equal terms (as opposed to the donorrecipient structure personified by the OEEC) and which acknowledged the obligations of rich, industrialized countries to developing economies. The European label was dropped, a development dimension was added in the form of the Development Assistance Committee (DAC), and the OECD was inaugurated. As of 2004, the OECD had 30 members. Originally an exclusively transatlantic organization, today the OECD boasts members from all but the African continent. In the 1960s and 1970s, the organization welcomed its first Asian and Australasian members with the accession of Japan (1964), Australia (1971), and New Zealand (1973). A second wave of expansion in the 1990s saw the accession of the first Latin American country, Mexico (1994), a second Asian country, South Korea (1996), and four of the former communist countries of Eastern Europe: the Czech Republic (1995), Hungary (1996), Poland (1996), and the Slovak Republic (2000). Theoretically, membership of the OECD is open to any country committed to the principles of a market economy and pluralistic democracy but in practice membership appears to have been driven by the geostrategic imperatives of U.S. foreign policy.

The bulk of the OECD's work is carried out by a labyrinth of committees and working groups supported by the Secretariat, housed at the organization's Paris headquarters. There are some 200 committees and working groups at the organization composed of officials from national capitals and representatives from permanent delegations to the OECD. Their task is to undertake peer reviews of member state policies to evaluate their performance, encourage improved policy making in the future, and to check compliance with standards and principles agreed on by the OECD. The Secretariat, numbering some 1,670 in 2003, supports the work of committees and working groups by managing the overall peer review process, providing documentation and analysis, catalyzing discussions, and providing institutional memory.

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