informa sobre participaciÓn de los diputados seÑores …

INFORMA SOBRE PARTICIPACIÓN DE LOS DIPUTADOS SEÑORES PABLOLORENZINI (JEFE DE DELEGACIÓN),LOS SEÑORES DIPUTADOS MANUELMONSALVE, IVÁN NORAMBUENA Y LOS SENADORES ANDRÉS ZALDÍVAR YJOSÉ GARCÍA, EN EL SEMINARIO PARLAMENTARIO DE ALTO NIVEL,EFECTUADO POR LA OCDE LOS DÍAS 1 Y 2 DE OCTUBRE EN PARÍS, FRANCIAY LA PARTICIPACIÓN EN LA ASAMBLEA PARLAMENTARIA DEL CONSEJO DEEUROPA, EN ESTRASBURGO, EL 30 DE SEPTIEMBRE, REPRESENTANDO A LACÁMARA DE DIPUTADOS EL H. DIPUTADO PABLO LORENZINI

HONORABLE CÁMARA:

A.- OCDE

Tengo a honra informar acerca de la participación que nos correspondió efectuar enel seminario organizado por la OCDE realizado los días 1 y 2 en París, Francia.

Asistieron formando parte de la delegación, los diputados Manuel Monsalve, IvánNorambuena, los Senadores Andrés Zaldívar y el suscrito, como punto focal de laCámara de Diputados de Chile ante la OCDE. Lo anterior, en Anexo 1 se incluyentodos los participantes y Anexo 2 se incluye el programa del Seminario.

I.-ANTECEDENTES

La OCDE en forma anual desarrolla dos Seminarios de Alto Nivel destinado aParlamentarios de los países miembros, cuyo tema central durante esta versiónrealizada en París fueron, El papel de la educación y las competencias para promoverun crecimiento inclusivo, las estrategias de crecimiento, la dimensión social deempleo, el comercio internacional y los impuestos.

II.-SEMINARIO PARLAMENTARIO.

El Secretario General de la OCDE, Ángel Gurría dio la bienvenida a las delegacionesintegrantes de la red Parlamentaria de la organización

El Señor Gurría dio un extenso discurso y realizo un análisis de la situación macroeconómica en un entorno menos favorable, agregando en su intervención lasReformas que América Latina necesita, destacando la participación latinoamericanay lo próximos países que eventualmente se incorporarán a la OCDE. En Anexo 3 seincluye un resumen del discurso del Ángel Gurría.

El Seminario comenzó con la exposición del experto Andreas Scheleicher,Director.OECD Directorate for Education and Skills, en el cual realizó un detalladoanálisis de todas las variables que afectan a la educación en los países miembros dela OCDE, incluido Chile, cuya situación aparece muy desmejorada.Destacó que en los países de mejor evaluación combinan la eliminación de ladesigualdad entre los estudiantes, la selección y potenciación de los prpfesores,especialmente la actualización de estos. Mayores detalles en £nexo 4.

El siguiente expositor, señor Stefano Scarpetta, Director, OECD Employment, Labourand Social Affairs Directorate. Se refirió al desempleo, el cual ha comenzado adeclinar pero en forma lenta. También señaló la importancia de la calidad de losempleos con mayores especializaciones. Por otra parte, destacó la diferencia entreun trabajo fijo y uno temporal, la mezcla de mejores trabajos, mejor calidad yseguridad en el mismo es la solución. En anexo 5 vemos detalles de su exposición.

Después de almuerzo se realizó un análisis del G-20 por intermedio de ChrístianKastrop y Stefano Scarpetrta, los cuales contaron a cerca de los resultados del trabajoen dicho G-20 sobre la protección al consumidor y la dimensión social del empleo.Detalles de ambas exposiciones en Anexos 6 y 7.

Posteriormente, el señor Ken Ash, Director, OECD Trade and Agriculture Directorate,nos expuso el tema de comercio, desglosando las áreas de Servicios, Trabajos en elsector financiero y las políticas de Inversión y comercio, las barreras regulatorias alas importaciones y servicios, entre otros temas . Detalles en anexo 8

Concluyendo la jornada de trabajo el señor Pascal Saint Amans, Director, OECDCentre for Tax Policy and Administration, expuso sobre impuestos. En Anexos 9 y 10se muestran comentarios sobre la evasión y elusión en la OCDE y el acuerdo sobrecooperación en este tema.

También se mencionó durante el Seminario, las interrogantes más comunes sobre laelusión, Anexo 11.

Durante el almuerzo de trabajo, que sostuvimos con la Embajadora de Chile en laOCDE, Claudia Serrano, se analizó en detalle la participación del Gobierno de Chileen la OCDE y su interrelación con el Congreso Chileno y se propusieron lasactividades mutuas de cooperación futura.También adjunto una publicación reciente de la OCDE que complementa loanteriormente mencionado en Anexo 12

Finalmente debo informar que asistí en representación de nuestra delegación a unareunión con el Presidente de la Asamblea Parlamentaria Francesa, compartiendo conotros jefe de delegación y el señor Ángel Gurría, Secretario General de la OCDE, enel Parlamento en París, intercambiando opiniones, informando al Señor Presidente,Claude Bartolomé, la realidad actual de Chile y especialmente de las reformas que elGobierno está llevando a cabo. Anexo 13

El próximo Seminario Parlamentario de la OCDE, se realizará en París entre los días25 y 27 de Febrero.

B.- ASAMBLEA PARLAMENTARIA DEL CONSEJO DE EUROPA

Como Presidente de la Comisión Mixta Parlamento Europeo - Chile, asistí a lareunión del Consejo Europeo en su vertiente Parlamentaria. El programa deactividades se resume en Anexo 14.

Se adjunta en Anexo 15, el reporte de las actividades de la Asamblea Parlamentariadel Consejo de Europa. Durante la reunión conversé con el Sr. Alfred Sixto, Head ofTable Office, con quien analizamos la posibilidad de que Chile y nuestro congresosean OBSERVADORES en la Asamblea Parlamentaria del Consejo de Europa (sóloMéxico es observador como país latinoamericano) Esta posible incorporación deChile también la conversé con la Ministra Secretaria General de la Presidencia,Ximena Rincón, y con el Presidente de la Cámara de Diputados, Aldo Cornejo, aefectos de comenzar a analizar dicha situación.

Posteriormente, sostuve una larga reunión con el Secretario General de la OCDE,Ángel Gurría para analizar la situación de Chile y los estudios realizados por la OCDErespecto a nuestro país en temas como Educación (Anexo 16), Comercio (Anexo 17)Panorama General (Anexo 18), GPS en Educación (Anexo 19) Canales de Integraciónde Chile (Anexo 20), Como va la Vida en Chile (Anexo 21). Otros de los temas quese analizó en la Reunión refiere a la violencia lntrafamiliar,(Anexo 22).

En dicho evento el suscrito participó en el Debate sobre Chile. Anexo 23

Posteriormente, sostuve un almuerzo de trabajo con la Presidenta de la AsambleaParlamentaria del Consejo Europeo , Anne Braseur, Anexo 24

Es todo lo que puedo informar a la Honorable Cámara de Diputados

Diputado

Pablo Lorenzíni Basso

De:Enviado el:Para:Asunto:

[email protected], 25 de septiembre de 2014 13:06Pablo Lorenzini BassoConfirmation d'inscription en reunión á f'OCDE / OECD registration confirmation

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OECDSETTER POLICiES FOR BETTER LIVES

Meeting of the OECD Global Parliamentary Network20ctober2014

OECD Conference Centre

Participants(as of 1 October, 6pm)

MPs

1 . Patricia Giménez, Argentina2. Imade Annouri, Belgium (Flemish Parliament)3. Caroline Bastiaens, Belgium (Flemish Parliament}4. Caroline Gennez, Belgium {Flemish Parliament)5. Dirk Van der Maelen, Belgium6. Mercedes Van Volcem, Belgium (Flemish Parliament)7. Stefaan Vercamer, Belgium8. Peter Wouters, Belgium (Flemish Pariiament)9. José García Ruminot, Chile10. Pablo Lorenzini, Chile1 1 . Manuel Monsalve, Chite12. Iván Norambuena, Chile13. Andrés Zaldívar, Chile14. Michael Arce Sancho, Costa Rica15. Natalia Diaz Quintana, Costa Rica16. Kalev Kallo, Estonia17. JeanBizet, France18. Christophe Caresche, France19. Pierre-Alain Muet, France20. Lothar Binding, Germany21. Wolfgang Strengmann-Kuhn, Germany22. Liam Twomey, Ireland23. Linda Lanzillotta, Italy24. Giampaolo Galli, Italy25. Yoshifumi Hamano, Japan26. Yoichi Miyazawa, Japan27. Chan-Yeol Lee, Korea28. Romualds Razuks, Latvia29. Daniel Avila Ruiz, México30. Marco Antonio Blásquez, México31. Francisco Búrquez, México32. Mario Alejandro Cuevas Mena, México ,

: h.

39. Jozef Kollar, Slovak Republic40. Branislav Rajic, Slovenia41. Andrej Sircelj, Slovenia42. Franc Trcek, Slovenia43. Jesús Caldera Sánchez-Capitán, Spain44. Pablo Casado Blanco, Spain45. Gabriel Elorriaga Pisarik, Spain46. José López Garrido, Spain47. Antoni Picó i Azanza, Spain48. Góran Pettersson, Sweden

Parliamentary Staffers

1. Sinclair Besombes, Sinclair Besombes, Administrator, Finance Committee, Senate, France2. Paola Bonacci, Sénior Officia!, Chamber of deputies, Italy3. Roberto Bustos Latorre, Secretary, Finance Committee, Senate, Chile4. Vizma Casno, Consultant, Budget and Finance (Taxation) Committee, Saeima of the Republic of Latvia5. Dong Chun Hwang, Staffer, National Assembly of the Republic of Korea6. lwona Kasprzyk-Sowa, Assistant to MEP Danuta Jazlowiecka7. Marcin Grajewski, Mead of Think Tank Service, Strategy and Coordination Unit, European Parliamentary

Research Service, European Parliament8. Ignacio Gutiérrez Cassillas, Legal Advisor, Chamber of Deputies, Spain9. Kieran Lenihan, Official, Houses of the Oireachtas, Ireland10. Daniel Lucion, Advisor (OECD issues), House of Representatives, Belgium11. Madeleine Orvelius, Committee Officer, Committee on Finance, Riksdag, Sweden12. Federico Pommier Vincelli, Parliamentary Staffer, Senate of the Republic, Italy13. Tateki Sakiyama, Researcher, Research Office of the Standing Committee on Budget of the House of

Counciflors, Japan14. Hiroyuki Togawa, Deputy Director, International Conferences División, International Affairs Department, House of

Councillors, Japan15. Sophie Waldteufel, Parliamentary Assistant, Pierre-Alain Muet, Assemblée National, France16. Sarah Yanicostas, Intem, Finance Committee, Senate, France

Observers

1. Pascale Andreani, Ambassador, Permanent Representative of France to the OECD2. Gabriele Checchia, Ambassador, Permanent Representative of Itaiy to the OECD3. Ricardo Díez-Hochleitner, Ambassador, Permanent Representative of Spain to the OECD4. Michael Forbes, Ambassador, Permanent Representative of Ireland to the OECD5. Iztok Jare, Ambassador, Permanent Representative of Slovenia to the OECD6. Annika Markovic, Ambassador, Permanent Representative of Sweden to the OECD7. Mithat Rende, Ambassador, Permanent Representative of Turkey to the OECD8. Paulo Vizeu Pinheiro, Ambassador, Permanent Representative of Portugal to the OECD9. Teresa Alvarenga, Deputy Permanent Representative of Portugal to the OECD10. Veronika Boskovic Pohar, Deputy Permanent Representative, Permanent Defegation of Slovenia to the OECD11. Alvaro Jara, Permanent Delégate of Chile to UNESCO12. Shigeru Omori, Minister, Permanent Delegation of Japan to the OECD13. Petr Halaxa, First Secretary, Permanent Delegation of the Czech Republic to the OECD14. Maya Camacho, Second Secretary, Permanent Delegation of México to the OECD15. Megumi Koike, Second Secretary, Permanent Delegation of Japan to the OECD1fi. Stefano Catani, Counsellor. Permanent Deleqation of Italv to the OECD

OECDBETTER POLICIES FOR SETTER UVES

21. Juah Song, Counseilor, Korean Embassy in Paris22. Pablo Gutiérrez, Policy Analyst, Permanent Delegation of México to the OECD23. Michaela Vituskova, Trainee, Permanent Delegation of the Czech Republic to the OECD24. Gergely Tibor Leóvey, Trainee, Permanent Delegation of Hungary to the OECD25. Daniel Jaime Arias, Intem, Permanent Delegation of México to the OECD26. Florence Le Roux, Permanent Delegation of France to the OECD

Interpreters

1. Mariko Higuchi, Interpretar (Japanese)2. Yoiiko Fujii, Interpreter (Japanese)3. Kimiko Monden-Bianchi, Interpreter (Japanese)4. Karen Twidle, Interpreter (English-French) - Reception at the Assemblée Nationale5. Hyo Sook Kim, Interpretar (Korean)6. Eun-Kyeong Ko, Interpreter (Korean)

OECD

1. Ángel Gurría, Secretary-General, OECD2. Christian Kastrop, Director, Policy Studies Branch, OECD Economics Department3. Anthony Gooch, Director, Public Affairs and Communications Directorate, OECD4. Pascal Saint-Amans, Director, OECD Centre for Tax Policy and Administration5. Stefano Scarpetta, Director, OECD Employment, Labour and Social Affairs Directorate6. Andreas Schleicher, Director, OECD Directorate for Education and Skills7. Willemien Bax, Head of Public Affairs, Public Affairs and Communications Directorate, OECD8. Trudy Witbreuk, Head of the Development División, OECD Trade and Agricuiture Directorate9. Raffaele Russo, Head, BEPS project, OECD Centre for Tax Policy and Administration10. Achim Pross, Head, International Cooperation and Tax Administration División OECD Centre for Tax Policy and

Administration11. Caroline Malcolm, Counseilor, OECD Centre for Tax Policy and Administration12. Julián Knott, Acting Deputy Head of Public Affairs, Public Affairs and Communications Directorate, OECD13. Silvia Zucchini, Public Affairs Manager, Public Affairs and Communications Directorate, OECD14. Gráinne Mooney, Public Affairs Coordinator, Public Affairs and Communications Directorate, OECD15. Silvia Terrón, Public Affairs Coordinator, Public Affairs and Communications Directorate, OECD16. Anja Gergaud, Intem, Public Affairs and Communications Directorate, OECD

DELÉGATE 02/10/2014

LORENZINI BASSOPabloChileMeefing off the OECD Global Parliamentary Netw...

For personal use only Wear your badge visiWy

i o.ou - i o.*u uosmg remarksAnthony Gooch, Director, OECD Directorate for Public Affairs and Communications

' -L-

') OECD

OECD Global Parliamentary NetworkMeeting

Remarks by Ángel Gurría,Secretary-GeneralOECD

París, France2October2014

(As prepared for deíivery)

Good morning Ladies and Gentlemen,

• Welcome to the OECD Global Parliamentary Network. It gives me great pleasure to see

this network growing from strength to strength since its creation in 2011. We now hold

three meetings per year, two in Paris and one "on the road".

• This year already, we held the very successful Parliamentary Days in February, where

we had a record turnout, thanks to our cióse work with the NATO Parliamentary

Assembly, and we were also kindly hosted by the Mexican Chamber of Deputies for our

meeting abroad in June.

• The growth of this network is a reflection of the importance that we give to our on-going

engagement with parliamentarians. The OECD is here to support you and your staff in

the critical task of policy making and ensuring that our data, analysis and policy advice is

readily available when you need it.

• Our dialogue with parliamentarians has also become an essential tool to fine-tune our

analysis with the experiences you bring from your work in your own constituencies.

• You have a futí programme ahead of you today, covering numerous issues. Allow me to

start by placing some of these issues in the broader context of the global economic

landscape, and outlining some key elements of the OECD's response to the current

global challenges.

The global economy is expanding at a modérate and uneven pace.

• As reported in our September Interim Economic Assessment, the global economy

continúes to expand at modérate pace, with an annual rate of around 3% in the first half

of 2014, the same pace as in the past 2 years. This is far from the robust and broad

expansión we need in order to heal the scars of the crisis.

This prolonged modérate economic growth has meant that global trade continúes to

grow sluggishly, only about half its pre-crisis pace. Investment has also been weak in

most major economies, hindering world GDP growth.

We are also witnessing growing differences in economic performance among and within

the main regions; and we expect them to continué in the near term. For example, among

OECD countries, the United States, the United Kingdom and Canadá are expected to

continué growing at a sustained pace through 2015 between 2% and 3% this year and

next. In contrast, growth in Japan and especially in the euro área has been

disappointing so far this year. It is not expected to strengthen substantially and will

remain around 1%. We are particularly concerned about the euro área, as weak demand

is becoming a chronic problem. While we are not projecting deflation in the euro área,

we see a growing risk of prolonged stagnation compared to just a few months ago.

Currently, the emerging economies represent the main bright spot in the global

economy. After slowing from 2010 onwards, the average GDP growth rate for the

BRIICS is showing signs of stabilising and is expected to strengthen and feed the global

economy. This improved momentum is originating in China and India. On the other

hand, Brazil fell into recession in the first half of 2014, and others continué to face

signifícant challenges to sustain solid growth rates. In particular, emerging economies

remain vulnerable to financial market shocks given the build-up of debt in recent years.

Some geopolitical risks have also worsened in the recent past, notably the deteriorating

situatíon in Ukraine and the Middle East, which could negatively impact the global

outlook.

• Financial markets appear blind to these risks: Equity markets are reaching record highs,

sovereign bond yields in several countries are near all-time lows and indicators of share

price volatility are around pre-crisis levéis, in the current context, such bullishness may

indícate a mispricing of risk and the attendant danger of a sudden correction.

The social legacies of the crisis are hindering the recovery.

• The crisis has left us three other legacies of serious social and political consequence.

• Unemployment remains well above its pre-crisis levéis in many OECD countries. We

expect average jobless rates in the OECD área to fall slightly from the current 7.4% to

7.1% by the end of 2015. Today, almost 45 million people are still out of work in OECD

countries, 12 million more than just before the crisis. Globally, an estimated 202 million

people remain unemployed, with many more in low-paid and precarious Jobs.

More worryingly, youth unemployment rates have reached alarming levéis, particularly in

a number of Euro área countries, such as Greece and Spain, experiencing rates of over

50%; while Italy, Portugal and the Slovak Republic are also badly affected.

Income inequality in OECD countries is at its highest level for the past half century and

has intensified during the crisis. The average income of the richest 10% of the

population is about nine times that of the poorest 10% across the OECD.

Last but not least, the erosión of citizens' trust in governments and institutions continúes

to plummet. According to the latest World Gallup poli, on average, only four out of ten

citizens in OECD countries say they have confidence in their government. And this loss

of trust extends beyond governments - trust in markets and businesses has also been

badly bruised, with potentially severe effects on longer-term investment and economic

growth prospects.

Working towards a new growth model.

• In addressing the many and multifaceted challenges which I have touched upon today,

we can no longer turn to traditional economic theories and policies. Collectively, we

must address these issues through a different growth model and through a new

economic paradigm. We need to shift our mind-set and focus it on building sustainable,

inclusive economies, and on restoring citizens' trust in governments and public

institutions. At the OECD we are working on several fronts to achieve these goals.

• In 2012 we launched the OECD New Approaches to Economic Challenges (NAEC)

initiative. Through NAEC, we embarked on an organisation-wide reflection process on

the roots and lessons from the crisis with the principie aim of improving our analytical

framework and policy advice. Pm pleased to say that it is starting to bear fruit. We are for

instance already using new tools to model the interlinkages between public policies,

such as how to achieve an equity and growth-friendly fiscal consolidation.

The OECD's Inclusive Growth Initiative has been one of the most important outcomes of

the NAEC process. Inclusive growth is a new prism through which we look beyond

traditional economic indicators toward issues such as: education and skills; Job quality;

health status; environment; civic participaron; and social connections. They all provide a

more accurate reflection of the multi-dimensional nature of well-being. Inclusive Growth

places inequality at its heart and focuses on a more tailored approach to targeting

disadvantaged social groups.

It is also essential to ensure that future growth doesn't come at the expense of our

planet. Climate change is no longer simply an environmental issue - it is an economic

and a social issue. Green growth is crucial and it involves making changes in most

áreas of our economies. Through our Green Growth Strategy, we are arguing for the

eliminatíon of subsidies to fossil fuels, the introduction of an appropriate price on carbón

and the removal of barriers to the mobilisation of investment in green technologies.

• Only last week, during the climate change talks at the UN in New York, we witnessed a

phenomenal mobilisation by the community, local governments and civil society. Their

role will be central in catalysing action and securing the necessary political will to finalise

an ambitious, global legal climate agreement at COP 21 in 2015.

• I would like to conclude with one recent major example of international policy

coordination. During the G20 Finance Ministers' meeting in Cairns, I presented the 2014

package on Base Erosión and Profit Shifting or "BEPS", at it is better known. This

package represents a major step forward in helping our governments to tackle

aggressive practices which erode the tax base of companies and artificially shift profits

to low or no-tax jurisdictions. These practices damage the integrity of our tax systems,

impede the capabilities of our governments, diminish the growth potential of our

economies and corrode the trust of our citizens.

You will receive a detailed briefing on BEPS this afternoon. Following its endorsement

by G20 Finance Ministers, BEPS should be one of the most important "deliverables" of

the 2014 G20 Leaders Summit to be held ín Brisbane, in November. These measures

will help reduce tax treaty abuse, better deal with the fiscal implications of the digital

economy, and neutralise hybrid mismatches. We are now looking forward to forthcoming

discussíons on the feasibility of a multinational instrument to streamline implementation.

The OECD has been working as a natural partner with the G20 since 2009, drawing on

our strength as a multidisciplinary organisation with an increasingly global voice. As you

will hear this afternoon, we have supported the G20 process across the board, providing

evidence-based policy advice in áreas such as trade and investment; labour and

employment, green growth and anti-corruption, to ñame but a few.

10

Ladies and gentlemen:

• I would like to reassert that our strengthened dialogue with parliamentarians - the Voice'

of society - remaíns vital in a fast-paced and increasingly globalised world.

• Together, through the exchange of national experience and lessons learned, on the one

hand; and of targeted policy advice and best practices on the other, we can overeóme

the legacies of the crisis and come closer to achieving our common goal of sustainable,

inclusive and fairer growth.

• Thank you once again for being with us today, I very much look forward to your

questions.

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Mean iiiuracy SCDIC Dy educatJO'iai attaiiimetit (301?)Below uppeí secondary educationUpper secondary oí posl-sccondary non-tertiary cducation

'•>?o íeitiary education

The shares of highly literate tertiary graduales arevery differentacross countries

In most countries, upward educationaf rnobility tends tobe lower in the younger generations

l'ropotlio'i ot ufjwcu'ü rnoinlity nuiot-s rige cjioups

tn 2012, moro than one in two foreign students wore enrolled in Australia,Canadá, Franco, Gcrmany, the United Kingdom or the United States

n u' foiiiicjn stnücnts n tcrtiaiy eclucütion Ijy «xintry oí dtótinaliuii (?01?i

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In 2011, OECD countries spent an average of 1.6% oftheir GDP on tertiary education

Tertíary education

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Mobilising resources for education

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A smart investment for individuáis and countries

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Prívale riel letit ins Public not letutns

02/10/2014

OECD Employment Outlook 2014

í)) OECD Stefano Scarpetta, Director for Employment, Labourand Social Affairs, OECD

The r eco ver y ¡s gaining momentum but there is notime for complacency

Unemployment has started to decline, but further progress ¡s required asthe job recovery has not gone very far yet

People have borne considerable personal, economic and social costs thatmay prove to be long-lasting:

— long-term unemployment remains persistently high- many workers have experienced falls in the real valué of their earnings

Fixed term contracts are increasingly used for new hires, but they are not anautomatic stepping-stone to permanent work

Not just morejobs but also better Jobs are needed. The good news is thatthere is little sign of a trade-off between Job quantrty and Job quality acrosscountries

Skills are the key to better jobs, but this requires giving people theopportunity to acquire the nght skills needed ¡n the labour market. It is notjust educational attainment that matters

Unemployment has started to decline, butfurther progress is required...

Unemployment ratePefcentaga oí trie labour torce

• Curren! valué (Oí M13) - SUrt oí <t\t atál (04 ÍOOT)

A County-spedlicpM* o PnfwlM v«U> (04 2015)

02/10/2014

Haly Euro área Franca OECD IMsd Kíi0doni UnhodSlates Canadá Qeimany Japan

Youth unemployment has reached very highlevéis in some OECD countries

45

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35 -

30 -

25

20

15

Youth unemployment rate (15-24)Percentage ot trie labour torce

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taly Euro ana Franca United OECD Canadá United Stales Gemiany Japan

02/10/2014

... since the Jobs recovery has not yetgone far enough

Employment-to-population ratioPercentage al Ihe working-age populallon {aged 15 or more)

• Curreni valúa (04 20131

- Saúl <t Ihe crtsli (04 2007)

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The personal, economic and social costs of thecrisis have been considerable

• Among those who are unemployed, an increasingnumber of persons are out of work for 12 months ormore, facing a depreciation of their skills and a riskof labour market exclusión

• Among those who have kept their Jobs, many low-paid workers and their families have experiencedeconomic hardship as a result of declines in thespending power of their earnings

The long-term unemployed face skill depreciation andlabour market exclusión

Long-term unemployed (more than one year)as a percenlage oí lolal unemployed

02/10/2014

Corada UnNod Slatas Unlsd OECD Franca Jopan Gem»ny Euros™ íaly

Real wage growth has come toa virtual standstill

Real hourly wage, average annualised percentage growth rate

•Q1300Í-QÍM13

rSource : OÉCD calculations basad on quarterly natíonal accounts.

The growth ¡n unit labour costs has slowed, particularly in anumber euro zone economies

02/10/2014

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but the flip side is that many workers saw the real valué oftheir earnings fall

Incidence of real wage cut In 2010Percanlage of full-time Job slayers

(aged 15-64, slaying al leas! one year witti Bie same employer)

• Nominal vta$6 aA -—— Real wage cu1

FIN NLO DNK SVN AUS LUX ITA POL AL^ FRA BEL ALL DEU USA CZE GBH ESP GRC PRT EST

Fixed term contracts are increasingly used for newhires

02/10/2014

Fixed-term contracts among new hiresPercentage of employees wltti no more than ihree mon&is o) lenure

2011-1! -2006-07

lililí

Temporary Jobs are not an automatic stepping-stone topermanent work

Three-year transition rates from temporary to permanent contractsShare of temporary employees ín 2008 ttial wera employed as tull-time

pemanent employees ¡n 2011

milmilNLÜ GHC EST FRA ESP IBt ÍTA AÜT BEL POL ALL PBT SWE LUX CZE SVN GBH FIN HUN SVK ÑOR ISL

02/10/2014

Gaps in employment protection between permanent andtemporary workers should be reduced...

When these gaps are excessive, the Job losses in a downturnare greater, especially for temporary workers. They alsoreínforce labour market segmentation and undermineemptoyment prospects for temporary workers

Reducing these gaps could be done by:

— lowering the level of protection for permanent contracts (which could raise labourchurning) or raislng protection for temporarv contracts (which would reduce labouradjustment)

— Or by introducing a single or unified contract. But these opilóos involves overcomingimplementation difficulties, especially where employment protection of permanentcontracts Is very strict

Reducing labour market segmentation also requirescomplementary reforms to be effective

Both more Jobs and better Jobs are needed

Job quality embraces a range of aspects that matter forwell-being:

• Earnings quality: level and distribution of earnings

• Labour market security: risk and consequence of Jobloss in terms of lost income

• Quality of the working environment: extent towhich workers have the resources they need to meetthe demands of their Jobs

02/10/2014

There is little sign of a trade-off between jobquantity and job quality across countries...

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... but there are considerable differences in job qualitybetween socioeconomicgroups within countries

Job qualíy outcomot by Eocio-demographk; group (fleoder. age, educatión)

Average over 23 Europxati counties, 2010

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02/10/2014

Having the right skills to get a good job:what matters most?

The OECD's international Survey of Adult Skills showsthat:

• It is not just educational attainment but also the typeof skills acquired and proficiency in these skills thataffect the probability of finding a Job

• Work experience and generic skills positively affectwages early on

Youth with high proficiency in literacy are much lesslikely to be out of work and out of school...

Th*dMinnIfiintialth«pn)b<biHlyoflMlngn«tth*rlfl«inpl0ynMfl< florín *duc*tlon»rtralnlng¡NEET), faryoungpo*pl**gid 16-29

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02/10/2014

... and work experience as well generic skills are keydeterminants of the level of pay

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• Eiperience

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OPrenoercym

Thankyou

Read more about our work

Website: www.oecd,ore/emplQ¥ment/out|opk

Follow us on Twitter : @OECD Social

10

Past G20 Commítments OECD contríbution and state of play Next stepsto set up a new Expert Group for a period of two years has

been sent to the Statistics Committee. The main goals of

this expert group will be the refinement of the

methodology for compiling distributional informationconsistent with national accounts, and to look at

possibilities to improve the timeliness of the dístributionainformation.

• Recommendation 18: The OECD has joined the World Bankinitiative to collect better and more detailed internationallyaligned data on government debt (for central government,general government and the public sector). In this respect,the OECD has taken responsibility for the collection andvalidation of data for OECD countries. The collection andpublication of the relevant dsía are now being part of theregular updating of statistics in OECD.Stat and the PGI-website.

• To a larger or lesser extent, the OECD is also co-operatingon several other recommendations, e.g. the improvementof data on international ¡nvestment positions, governmentrevenues, measuring cross-border exposures of financialand non-financial corporatíons, consolidation issues, etc.

The OECD has also taken responsibility for the calculation of G-20 zone-aggregates. A dedicated press reléase by the OECD waspublished in March 2012 on G20 zone-aggregates for economicgrowth. After that, the G20 aggregate became part of theregular OECD press raleases on economic growth. On October

14, 2013, a G20 aggregate for inflation (consumer price Índex)will be published for the first time; in following press releases,

the G20 aggregate will be included in the monthly pressreleases on prices.

Finally, in 2012, regional conferences have been organised withthe G20 countries to discuss progress made at national and¡nternational level. The OECO actively contributed to two ofthese conferences (México and Ankara), by chairing part of themeeting as well as by presenting results on some of therecommendations. The OECD also particípales in the annual

PastG20Commitments OECD contribution and state of play Next stepsis on the way and the agreed témplales will be populatedprogressively with relevant OECD data series accessible onthe Interagency PGI website.

• Recommendation 15: The OECD {statistics directorate)plays a leading role in the development and collection ofdata on the so-called Quarterly Sector Accounts (QSA), TheQSA provide quarterly information on all incomes andoutlays, financial transactions and balance sheets for themain sectors ¡n the economy (non-fínandal corporations,financial corporations, government, households and rest ofthe world). As such, they allow for a more timely analysisof the interaction between the real economy and thefinancial economy. In addition, they aim at províding¡nformation on the ¡nterconnections and interdependenciesbetween national sectors and the rest of the world.Significant progress has been made in this área, availablecountry data are now being updated in OECD.Stat and thePGI website on a regular oasis.

• Recommendation 16: The OECD, together with Eurostat,leads the work on the future development of more detailedinformation on the distribution of income, consumptionand wealth between different household groups, by linkingthe macro-economic statistics on households with relevantmicro-data. The OECD is collecting information on incomeequality and poverty through a network of nationalcorrespondents, based on common and comparabledefínitions. Furthermore, two Expert Groups, with theparticipation of a Significant number of countries, havefinalised their work as per a two year mándate. One of theExpert Groups developed guidelines for measuring thedistribution of household wealth, and finalised a reportcovering the three dimensions of economic well-being(income, consumption and wealth) in an integrated way.The other Expert Group linked, for a certain benchmarkyear (2009 or 2010), micro data sources on income,consumption and wealth to the relevant macro-estimatesfrom the system of national accounts. Recently, a proposal

Statistics

Past G20 Commitments OECD contribution and state of play Next steps

[Final Report, G20 Working Group on ReinforcingInternational Cooperation and Promoting Integrity¡n Financial Markets (WG2), 27 March 2009, para281"We recognise that for effective early warnings datacollection needs to be strengthened. We thereforeaskthe IMF and the FSFto explore gaps and provideappropriate proposals for strengthening datacollection befare the next meeting of G20 Finance

Ministers and Central Bank Governors."

OECD involvement in the G20 Data Gaps Initíative (DGI)

The IMF and the FSB have developed a set of twentyrecommendations for the improvement of statisticalinformation that have been agreed upon ¡n the aftermath ofthe 2008 financial crisis. Progress on these recommendations ismonitored by the ínter Agency Group (IAG), consisting of theIMF (chair), BIS, ECB, Eurostat, OECD, United Nations and WorldBank. Annuai progress reports are provided to G20 FinanceMinisters and Central Bank Governors. Statistical results for theG20 economies (including countries who are members of theFSB) are published on a dedicated Principal Global Indicators(PGl)website.

The OECD contributes to the work undertaken by the DGI inresponse to the following recommendations:

• Recommendation 13: OECD (Investment División) iscontributing to this recommendation on new measures ofcross-border risk exposure of financia! and non-finandalcorporations. Currently, the Investment Committee isdeveloping statistical series to measure total financing ofmultinational enterprises.

• Recommendation 14: The OECD (Statistics Directorate andDirectorate for Financial and Enterprise Affairs) togetherwith the IMF, BIS and the ECB have developed standard

témplales covering the international exposures of largenon-bank financial institutions. A navigation tool has beendeveloped for publication of the dedicated templates onthe PGI website. The templates will help users to efficientlyaccess key aggregates regularly updated on the cross-border positions of specific economic sectors of reportingeconomies both a broad sectorization of the wholeeconomy and a more detaüed sectorization of the reportingeconomy's financial corporations. The dissemination phase

Disaster Risk ManagementIn November 2012 and at the request of the G2Q, the OECD Jaunched a methodological framework on disaster risk assessment and financing to strengthen

national Disaster Risk Management (DRM) pians. The framework is intended to be a voluntary, fíexibíe and non-prescriptive tool that countries may use as ameans of self-assessment of their progress towards targeted and focused approach to besí pracíices in managing disasters.


[Communiqué, Finance Ministers, México City, 25-26 February 2012]

"We recognize the valué of Disaster RiskManagement (DRM) tools and strategies to betterprevent disasters, protect populations and assets,and finanaalty manage their economic impacts. (...)To that end, we have asked the World Bank toprepare a compilation of country experiences andthe OECD to recommend a framework that countriesmay useforthe implementation of DRM strategies."

[Communiqué, G20 Finance Ministers, México City,4-5 November 2012, para 31]

"(...) We aparecíate and welcome the combinedefforts made by the World Bank and the OECD, withthe support of the United Nations, to broaden theparticipation in the discussion on DRM byhighlighting the central role that financialpolicymakers play to support other áreas ofGovernment and civil society in dealing with

disasters. We welcome the G20/OECD voluntaryframework for disaster risk assessment and riskfinancing which provides a detailed guideline thataims to facilítate the implementation of moreeffective DRM strategies. {...)"

Under the Finance track, the Mexican Presidency prioritisedraising awareness of G20 Members regarding the strongimpact that Disasters can have on the world economy. Thejoint deliverable in this área encompasses a publication and amethodological framework:

• At the Los Cabos Summit, the Mexican G20 Presidency andthe World Bank delivered a joint publication on Improving

the Assessment of Disaster Risks to Strengthen FinancialResilience. The OECD submitted a contribution related torisk assessment and financing for this publication.

• The OECD delivered a methodological framework on riskfinancing and disaster risk management on November 4at a joint press conference OECD Secretary-General Gurria,Mexico's Finance Minister Meade and the President of theWorld Bank, Dr. Jim Yong Kim, in the margins of the G20Finance Ministers meeting.

Welcoming OECD's and World Bank'scontribution to G20 work on DRM, G20 FinanceMinisters and Central Bank Governors"...encourage further efforts by the World Bankand OECD in cooperation with other relevantinternational organizations to leverage thevoluntary framework in arder to addressremaining challenges." [Communiqué, FinanceMinisters, 4-5November2012, para. 31]

As part of the follow up to the G20, the OECD iscontributing, aíong with the World Bank andAsian Development Bank, to the APEC initiativeon best practices in financial authority responsesto disasters.

References

G20/OECD Methodological Framework on Disaster Risk Assessment and Risk Financing

httg://www.oecd.ore/mexico/g20oecdJ:rameworkfQrdisasig rriskmanagem_ent.htm

Past G20 Commitments OECD contribution and state of play Next stepsOECD coordinated the preparation of the report, based on

inputs from the WB, ILO and WTO. The report examines

the links between trade líberalization, employment andgrowth and contains new analytical work on the ¡mpact oflowering tariff and non-tariff barriers on job creation for

skílled and non-skilled workers. It also considers how thecrisis affected trade and employment, assesses the policy

responses in responding to the downturn and the lessonslearnt from this experience. Moreover, at the request ofthe Korean Presidency of the G20, we undertook new

analytical work to quantify the impact of plausible tradeliberalization scenarios on employment, wages and GDP.

References - www.oecd.orfi/g20/topics/trade-and-investment/

OECD (2012), Policy Priorities for International Trade and Jobs, {ed.J, D. Lippoldt, e-publicationwww.oecd.org/trade/icite.

Meeting of the OECD Council at the Ministerial Level, Interconnected Economies: Benefiting from Global Valué Chains, 2013http://www.oecd.ore/mcm/C-MIN%282Q13%29l5-ENG.pdf

Freedom of Investment Roundtables:www.oecd.org/daf/investment/foi

lOth joint WTO-UNCTAD-OECD report on G20 trade and investment measures, December 2013hüp://oecd.org/daf/inv/investment-policv/10thG20Tradelnvestment.Ddf

OECD work on Trade and Jobswww.oecd.org/trade/empiovment

"Seizing the Benefits of Trade for Employment and Growth", Joint OECD, ILO, World Bank, WTO report prepared for submission to the G20 Summit Meeting in Seoul(Korea), 11-12 November2010,http://www.oecd.orfi/dataoecd/61/57/46353240.pdf

Past G20 Commitments OECD contrifaution and state of play Next steps

[Declaration, G20 Leaders,September 2013, para. 45 - 49]

Saint Petersburg,

44. "We recognize the risks of economic slowdownand trade weakening posea by protectionism. We

extend until the end of 2016 our standstillcommitment; being fully committed to furtherprogress in removing barriers and impediments toglobal trade and investment, we reaffirmcommitment to roll back new protectionist

measures."

45. "We valué monitoring of trade and investmentrestrictive/opening measures by the WTO, the OECDand the UNCTAD. We cali on them to continué andreinforce this work consistent with their respectivemóndales so as to better resist protectionism andpromote Hberalization of global trade andinvestment."

49, "We welcome the work done by the OECD, theWTO and the UNCTAD and ask them to seek theviews of governments and continué their researchon the impact of GVCs, particularly ¡n relation to theinfluence of GVCs on trade, economic growth,development, Job creation and distributíon of value-added along GVCs. [...]We cali for the OECD incooperation with the WTO and the UNCTAD todeiiver a report in the first half of 2014"

countríes.

620 Leaders welcomed this report in Saint Petersburg.

Befare presenting the report, the OECD also co-hosted,jointly, with the Russian G20 Presidency a stocktakingseminar on GVCs, held on 29 May 2013, in the margins ofthe OECD Ministerial Council meetíng. The event broughttogether high-level participants from governments,business and international organizations. The discussionsled to concrete proposals, such as the one by MexicanMinister of Economy, Mr. Ildefonso Guajardo, whosuggested that the G20 consider creating an "observatoryof global valué chains", supported by the OECD, the WTOand other international organisations within theirmandates, that wouíd further the analysis andunderstanding of global value-chains and their policyimplications.

Trac/e, Employment and Jobs

The OECD delivered a background document on trade andjobs for the G20 Trade Ministerial meeting in PuertoVallarla, April 2012.

The OECD has been pursuing work in this domain, in thecontext of the International Collaborative Initiative onTrade and Employment (ICITE). Launched in May 2010 andcoordinated by the OECD, ICITE is a joint undertaking of 10leading international organizations brought together totake a fresh look at the relationship between trade andjobs, considerthe role of trade policy and complementarypolicies (education, training, ¡nnovatton etc.), promote

informed dialogue among stakeholders, and communicatekey findings to policy-makers and the public. An e-publication (May 2012) presents highlights from the firsttwoyearsof work.

A report on the benefits of trade liberalization foremployment and growth, coordinated by the OECD, wassubmitted to Leaders in Seoul ¡n November 2010. The ,


[Dedaration, G20 Leaders, Los Cabos, June 2012,para. 28 - 29]

"28. We are deeply concerned about rísing instancesof protectionism around the woríd. Following up our

commitment made in Cannes, we reaffirm ourstandstill commitment until the end of 2014 with

regará to measures affecting trade and investment,and our pledge to roll bock any new protectionistmeasure that may have arisen, including new exponrestrictions and WTO-inconsistent measures tostimulate exports. We also undertake to notify in atimely manner trade and investment restrictivemeasures. We uphold the inventory and monitoringwork of the WTO, OECD and United NationsConference on Trade and Development (UNCTAD) ontrade and investment measures and encouragethem to reinforce and deepen the work in theseáreas, consistent with their respective mandates.29. We valué the discussion held by our TradeMinisters in Puerto Vallaría on the relevance ofregional and global valué chains to world trade,recognizing their role in fosteríng economic growth,employment and development and emphasizing theneed to enhance the partidpation of developingcountries in such valué chains. We encourage adeepening of these discussions in the WTO, UNCTADand OECD within their respective mandates, and wecali on them to accelerate their work on analyzingthe functioning of global valué chains and their

relottonship with trade and investment ftows,development and Jobs, as well as on how to measuretrade flows, to better understand how our actíonsaffect our countries and others, and to report onprogress under Russia's Presidency."

^ And possible ways to support DDA negotiations.

The OECD provided two background documents: one on

fighting protectionism and another on trade and Jobs.OECD Secretary-General Gurría outlined the benefits of

open trade policies in the context of an ever more complexreality of international trade characterized by segmentedglobal valué chains. And G20 Trade Ministers conveyedtheir strong support to OECD work (¡n cooperation withWTO and UNCTAD) on trade in value-added and globalvalué chains, support that was also conveyed by Leaders inLos Cabos.

In August 2013, the OECD-WTO-UNCTAD responded to therequest of Leaders in Los Cabos with the joint report onImplications of Global valué Chains for trade, Investment,Development and Jobs. It offers a strong evidence-base onnot just why, but also on how markets can be made moreopen.

(i) Rolling back unnecessary constraints to trade,inctuding those introduced (temporarily) in responseto the economic crisis. As goods and services cross

borders múltiple times, the cost of protectionism andthe benefits of multilateral opening are magnified.

(ii) Addressing remaining tariff peaks and escalation inagriculture and manufacturing, as well as unnecessary

non-tariff measures; this will reduce trade costs andcan boost growth significantly - it can also encouragemuch needed investment in developing countryagriculture in response to growing global demand.

(iii) Facilítate trade by removing inefficient andunnecessary border procedures: a 1% reduction intrade costs could potentially increase global incomeby USD 40 billion, with 65% of the benefits expectedto accrue to developing countries; the costs of¡mplementtng these measure are relatively low and,importantly, there is significant donor fundingavailable to support needed action ín less developed

underlined the ¡mportance of further examining the

consequences of expanding GVCs, notably for

developing countries, and encouraged further work by

the OECD and WTO in this área.

G20 Australian Presidency - OECD StocktakingSeminar on Global Valué Chains

The OECD organized and hosted a GVC Stocktakingseminar in the margins of the OECD Ministerial on 5May 2014 (back to back with the meeting of the G20national contact points on trade), The seminar involveda wide range of stakeholders and took stock ofprogress in the analysis of the development of GVCsand their impact on trade, economic growth,development, job creation and the distribution of

value-added. Participants discussed concrete policyactions (in the área of trade facilitation, services,supply chains strategy) that G20 governements couldtake, in the context of their growth strategies, tofacilítate the functioning of GVCs and raise collectiveGDP by 2% by 2018. The outcomes of the Stocktakingseminar informed the discussion at the meeting of theG20 national trade contacts held the next day.

The OECD's Services Trade Restrictiveness índex (STR1),which was released on May 7 during the OECD Week,will make an additional contribution to G20 discussionon concrete policy action to be taken to improve theeffíciency of services and the functioning of globalvalué chains.

Investment and TradeThe OECD has monitoreti trade and ínvestment potrcy developments and related-protectíonisí measures in co-operation wíth WTO and UNCTAD and publiclyreported on its ftndíngs, since 2009. in additíon, the impact of trade related measures are assessed on a períodíc basis by OECD. The most recent, lOíh joint

WTO-QECD-UNCTAD report was pubiished on ISth December2013. Buílding on íheir ¡nnovation ín this domain, the OECD, joíntly with íhe WTO and UNCTAD,were asked by G20 leaders assembled Ín Los Cabos to analyse the ímplications of the emergence of regional and global valué chains ín international trade.Theír report was welcome fay Leaders in Saint Petersburg and íhe OECD, ¡n cooperation with other ínternational organizations, was asked to further íts

research on GVCs and to report back in 2014.


[Declaration of the Summit on Financial Marketsand the World Economy, G20 Leaders, WashingtonDC, November 2008, para. 13]"I/Ve underscore the critica! tmportance of rejectingprotectionism and not turning inward in times offinancial uncertainty. In this regará, within the next12 months, we will refrain from raising new barriersto investment or to trade in goods and services,imposing new export restrictions, or implementingWorld Trade Organization (WTO) inconsistentmeasures to stimulate exports."

[Statement, G20 Leaders, Pittsburgh, September2009, para. 48]"We welcome the latest joint report from the WTO,OECD, IMF and UNCTAD and ask them to continué tomonitor the situation within their respective

mándales, reporting publicly on tríese commitments

on a quarterlybasis."

[Declaration, G20 Leaders, Toronto, June 2010,para. 37]"We ask the OECD, the ILO, World Bank, and the

WTO to report on the benefits of trade liberalizationfor employment and growth at the Seoul Summit"

Monitoring new barriers to trade & investment

Since the London Summit in April 2009, WTO, OECD andUNCTAD are mandated to monitor and publicly report on

trade and investment measures. At the Seoul Summit, thismándate was extended by the G20, in parallel with thestandstill agreement, until 2014. The OECD together withUNCTAD is responsible for providing the investment part ofthe monitoring reports, including on capital controls, whilethe WTO is responsible for the trade part. The 10th jointWTO-OECD-UNCTAD report was published on 18th

December 2013. This last report highlights the need forgovernments to shine a spotlight on trade and ¡nvestmentas a source of growth, employment creation anddevelopment.

Trade in Value-Added and Global Vaiue-Chains (GVCs)

The Mexican Presidency of the G20 held the fírst G20Trade Ministerial meeting on 18-20 April 2012, in PuertoVallarla, ahead of the Leaders' Summit in Los Cabos. Themain issues discussed at this meeting were:

v'Understanding global valué chains in a view toelaborating a "new trade narrative";

v^ Trade, growth and Jobs;

S Renewing G20's anti-protect¡onist commitment;

• In Saint Petersburg, Leaders extended theirstandstill commitment until the end of 2016 andupheld the related inventory and monitoring workof the OECD, UNCTAD and WTO, on trade and¡nvestment measures. The OECD is continuing itsmonitoring exercise on trade and investmentprotectionist measures, alongside with other lOs,and is also developing an assessment of the

economic impact of protectionist measuresadopted since the start of the crisis.

Leaders encouraged the OECD, UNCTAD and WTOto further their research and analysis on the impact ofGVCs on trade, economic growth, development, Jobcreation and distribution of value-added along GVCs;to deliver a new report by the first half of 2014.Following this cali, the OECD delivered in March 2014,ahead of the second Sherpa meeting under theAustralian Presidency, a report considering theimpediments to participation in GVCs and warranted

policy action (including structuraí reforms) to boosttrade as a source of growth. The key conctusions and

policy Ímplications of our GVCs report were presentedat the second Sherpa Meeting in March. !n thediscussion that followed countries praised our work, ¡nparticular the various policy interlinkages related toGVCs and the focus on sen/ices, and China also

Past G20 Commitments OECD contribution and State of Píay Next stepsinstitutions, to detall our implementation plan at ourSeptember meeting. In parallel, we expect to begin toexchange Information automatically on tax mattersamong G20 members by the end 0/2015. We cali forthe early adoption of the standard by thosejurisdictions that are oble to do so. We cali on allfinancial centres to match our commitments. Weurge olí jurisdictions that have not yet complied withthe existing standard for exchange of ínformatíon onrequest to do so and sign the Multilateral Conventionon Mutual Administrative Assistance in Tax Matterswithout further delay."

References - www.oecd.org/g20/topics/taxation /

Global Forum on Transparency and Exchange of Information for Tax Purposeswww. o ecd. o re/tax/t ra n spa re n cy

OECD Secretary-General Report to the G20 Leaders: Progress Report to the G20 by the Global Forum on Transparency and Exchange of Information for Tax Purposes, andreport by the OECD Secretary-General on base erosión and profit shifting (BEPS), September 2013http://www.oecd.org/e20/topics/taxation/SG-report-G20-Leaders-5tPetersburg.Ddf

Work on Base Erosión and Profit Shifting (BEPS)http://www.oecd.org/tax/beps.htm

Meeting of the OECD Council at Ministerial Level 2013, Declaration on BEPShttp://www.oecd.ore/mcm/C-MIN%282013%2922-FINAL-ENG.pdf

Addressing Base Erosión and Profit Shifting

http://www.keepeek.com/Dieital-Asset-Management/oecd/taxation/addressine-base-erosion-and-profit-shifting 9789264192744-enffpaeel

Action Plan on Base Erosión and Profit Shiftinghttp://www.oecd.ore/ctp/BEP5ActionPlan.pdf

OECD work on Tax Crimeshttp://www.oecd.orE/ctp/crime/abouttaxandcrime.htm

Past G20 Commitments OECD contribution and State of Play Next stepsDeveloping countries and the international taxsystem"[...] we welcome the OECD Tax Inspectors withoutBorders initiative, which aims to share knowledgeand increase domestic capacities in developingcountries in the tax área."

[Communiqué, G20 Finante Ministers and CentralBank Governors, October 2013, para. 6]

"We will to closety monitor the implementation ofthe ambitious tax agenda agreed by our Leaders in StPetersburg and lookforward to the regular reportingof the Global Forum and the OECD, in particular asregarás creating a new standard of automaticexchange of Information and implementing the BEPSAction Pian. In addition, we reitérate the needfor theGlobal Forum to complete the allocation ofcomprehensive country ratings regarding theeffective implementation of information exchangeupon request and ensure that the implementation ofthe standards are monitored on a continuous basis.We o/so reitérate our commitment to FATF's work".

[Communiqué, Finance Ministers and Central BankGovernors, Sydney, 22-23 February 2014, para. 3]

"We are committed to a global response to BaseErosión and Profit Shifting (BEPS) based on sound taxpolícy principies. (...) We continué ourfull support forthe G20/OECD BEPS Action Plan, and lookforward toprogress as set out in the agreed timetable. By theBrísbane summit, we will start to deliver effective,practical and sustainable measures to counter BEPSacross all industries (...). We endorse the CommonReporting Standard for automatic exchange of taxinformation on a reciprocal basis and will work withall relevant partíes, including our financial

all interested countries to particípate herein.

At the FM&CBG Meeting ¡n Sydney, on February 21-23,2014, Ministers reiterated their support to the G20/OECDBEPS Action Plan.

Tax and Crime

In June 2012, Leaders welcomed efforts to enhance¡nteragency cooperation to tackle illicit flows as part ofthe Oslo Dialogue on Tax and Crime launched ¡n March2011 by the OECD. The second meeting of the OsloDialogue initiative was held in Rome on 14-15 June 2012,at which two major reports were launched: The Report onEffective Inter-Agency Co-operation in Fighting Tax Crimesand Other Financial Crimes and The Catalogue ofInstruments for International Co-operation Against TaxCrimes and other Financial Crimes. In April 2012, OECDlaunched a pilot training programme on criminal taxinvestigation primarily for developing countries.

Past G20 Commitments OECD contríbution and State of Play Nextstepsthe efforts to enhance interagency co-operation totackle illicit flows including the outcomes of the Rome

meeting of the Oslo Dialogue. We reitérate the needto prevent base erosión and profit shifting and we

will follow with attention the ongoing work of the

OECD in thls área."

[Declaration, G20 Leaders, St Petersburg,September 2013, para. 50-52]

BEPS"(..) We fulty endorse the ambitious andcomprehensive Action Plan - originated in the OECD~ aimed at addressing base erosión and profit shiftingwith mechanism to enrích the Pian as appropriate.We welcome the establishment of the G20/OECDBEPS project and we encourage all interested

countries to particípate".

Exchange oftax Information"We commend the progress recently achieved in the

área of tax transparency and we fully endorse theOECD proposal for a truly global model formultilateral and bilateral automatic exchange ofInformation."

[...] "we are committed to automatic exchange ofInformation as the new global standard [...]"

[...] "We cali on all countries to join the MultilateralConvention on Mutual Adminístratíve Assistance inTax Matters without further delay."

[...]"We encourage the Global Forum to complete theallocation of comprehensive country ratingsregarding the effective implementation ofinformation exchange upon request"

of ratificatíon of the Convention (Belize, Ghana, Greece,

Ireland, Malta, and the Netherlands including itsCaribbean islands - Bonaire, Saint Eustatius and Saba - anc

Aruba, Curacao and Saint Maarten). The United KingdomCrown dependencies {Jersey, Guernsey and Isle of Man),

have recently asked to have the Multilateral Conventionapplied to them under territorial extensión by the UnitedKingdom. At the St Petersburg Summit, Leaders called onall countries to join the Multilateral Convention withoutfurther delay,"

BEPS

In the context of fiscal consolidaron, with VAT andpersonal income tax ¡ncreases, the perception that somecorporales do not contribute fairly has become a seriouspolitical and social issue. Responding to the G20 cali, theOECD published Addressing Base Erosión and ProfitShifting on 12 February 2013. The report presents theissues related to BEPS in an objective and comprehensivemanner. The report first describes studies and dataavailable in the public domain regarding the existence andmagnitude of BEPS. It then contains an overview of globaldevelopments that impact on corporate tax matters. Thecore of the report sets out an overview of the keyprincipáis that underline the taxation of cross-borderactivities, as well as the BEPS opportunities these

principies may créate. It also analyses some well-knowncorporate structures and highlights the most importantissues that these structures raise. The report recommendsthe development of an action plan to address BEPS issuesin a comprehensive manner. The OECD delivered anAction Plan on addressing BEPS to the G20 FinanceMinisters meeting in July 2013, setting 15 clearlyidentified actions that will result in a fundamental changeto the international tax rules. The Action plan wasendorsed by Leaders in St Petersburg Summit inSeptember 2013 and the establishment of the G20/OECDBEPS project was welcomed by Leaders, who encouraged

Netherlands and attended by delégales from over 20developing countries. The OECD organised the Third

International Forum on Tax and Crime on 7-8November 2013 in Istanbul. The discussion focused

on the current issues and country experiences on keypolicy and operational topics in combating all formsof financial crime. The event also included discussions

on the outcomes of the first meeting of the newOECD Forum of Heads of Tax Crime Investigaron, andthe OECD Capacity Building Programme for Tax CrimeInvestígators, which was launched in 2012.

Past G20 Commitments OECD contribution and State of Play Next steps[Declaration, G20 Leaders, Cannes, November 2011,para. 35-36]"We welcome the commitment made by olí of us tosign the Multilateral Convention on MutualAdministrative Assistance in Tax Matters and stronglyencourage other jurísdictions tojoin this Convention.In this context, we will consider exchangingInformation automatically on a voluntary basis asoppropriate and as providedfor in the convention;""The FATF, the Global Forum and other internationalorganizations should work closety together toenhance transparency and facilítate cooperationbetween tax and law enforcement agencies in theimplementation of these standards. We also cali onFATF and OECD to dofurther work to prevent misuseofcorporate vehicles."

[Declaration, G20 Leaders, Los Cabos, June 2012,para. 48]"In the tax orea, we reitérate our commitment tostrengthen transparency and comprehensiveexchange of Information. We commend the progressmade as reported by the Global Forum and urge allcountries to fully comply with the standard andimplement the recommendations identified in thecourse of the reviews, in particular the 13juhsdictions whose framework does not allow themto qualify to phase 2 at this stage. We expect theGlobal Forum to quickly start examining theeffectiveness of information exchange practices andto repon to us and our finance ministers. Wewelcome the OECD report on the practice ofautomatic Information exchange, where we willcontinué to lead by example in implementing thispractice. We cali on countries to join this growingpractice as appropriate and strongly encourage al¡juhsdictions to sign the Multilateral Convention onMutual Administrative Assistance, We also welcome

offshore tax evasión while keeping compliance costs aslow as possible. In St Petersburg the OECD work receivedfull support from the Leaders and the Organisation wastasked to present "a new single global standard forautomatic exchange of information by February 2014 andto finalise technical modalities of effective automaticexchange by mid-2014". The Leaders also asked theForum "to establísh a mechanism to monitor and reviewthe ¡mplementation of the new global standard onautomatic exchange of Information." [Declaration, G20Leaders, St Petersburg, September 2013, para. 50-52],This cali was reiterated in October 2013 by the FinanceMinisters and Central Bank Governors.

At the February Meeting of FM&CBG, the OECD deliveredthe new international standard for automatic exchange oftax information (Common Reporting Standard) - as perLeaders' request in St. Petersburg.

Multilateral Convention on Mutual AdministrativeAssistance in Tax Matters

The Multilateral Convention on Mutual AdministrativeAssistance ¡n Tax Matters provides the legal basis forautomatic exchange for those interested in this form ofexchange. Since the Convention was updated and openfor signature by all countries in June 2011, in response toa cali from the G20, over 60 countries have either signedor committed to sign the Convention (including all G20countries). Interest in the Convention continúes to growand a wide range of countries participated in the signingceremony which was held ¡n París on the occasion of theOECD Ministerial Council Meeting in May 2013. Indeed, asa further sign of international efforts to crack down on taxoffenders, 12 more countries have signed (Austria, Belize,Estonia, Latvia, Luxembourg, Nigeria, Saudi Arabia,Singapore and the Slovak Republic), or committed to sign (Burkina Faso, Chile and El Salvador), the Convention. Inaddition, another 6 countries deposited their instrument

information automatically on tax matters among G20members by theend of 2015. Ministers also calledforthe early adoption of the standard by thosejurisdictions that are able to do so.

BEPS: In St Petersburg, after endorsing the BEPSAction Plan, Leaders asked for regular reporting onthe implementation of the 15 actions identified bythe Action Plan. At the February FM&CBG Meeting,Ministers stated that by the Brisbane summit, theywill start "to deliver effective, practica! andsustainable measures to counter BEPS across allindustries, including traditional, digital and digttalisedfirms, in an increasingly globalised economy"(Communiqué, Meeting of Finance Ministers andCentral Bank Governors, Sydney, 22-23 February2014, para. 9),

Developing countries and the international taxsystem: The OECD Tax Inspectors without Bordersinitiative was welcomed by the G20 Leaders in StPetersburg. They also called on "the DevelopmentWorking Group ¡n conjunction with the Finance Track,to work with the OECD, the Global Forum and otherlOs to develop a roadmap showing how developingcountries can overeóme obstacles to participation inthe emerging new standard in automatic exchange ofinformation, and to assist them in meeting thestandard in accordance with the action envisaged inthe St Petersburg Development Outlook. The WorkingGroup should report back by our next meeting."[Declaration, G20 Leaders, St Petersburg, September2013, para. 52]

Tax and Crime: In Apríl 2013 Italy hosted the firstinteractive in-depth workshop to train criminal taxinvestigators to better enable them to fight financialcrime and illicit flows with particular support fromItaly, Norway, the United States, Germany and the

• 17 •

Taxation

The work of the Global Forum on Transparency and Exchange of Information for Tax Purposes - hosted and supported by the OECD- has been criíícai in

achievíng the remarkable progress regisíered in the realm of international tax íransparency since the Washington Summít ¡n November 2008. All of the 87jurisdictíons originaily covered by íhe Globai Forum have now committed to the Global Forum's standards of tax information exchange and transparency.

Moreover, ali 620 countries signed the OECD/Council of Europe Conventíon on Mutual Admínistratíve Assistance in Tax Maíters thaí provides for automaticexchange of tax information, On this subject, Leaders, assembled ¡n St. Petersburg, endorsed the OECD proposal for a truiy global rnodel for multilateral andbilateral automatic exchange of ¡nformation. They aiso endorsed the OECD Acííon Plan against Base Erosión and Profit Shifting (8EPS),

Past G20 Commitments OECD contríbution and State of Píay Next steps

[Action Plan, Washington, November 2008, para.80]"Tax authoríties, drawing upon the work of relevantbodies such as the OECD, should continué efforts topromote tax information exchange. Lack oftransparency and a failure to exchange taxinformation should be vigorouslyaddressed."

[Statement, G20 Leaders, London, April 2009, para.

15]"I/Ve agree [.....] to take action against non-cooperative jurisdictions, induding tax havens. Westand ready to deploy sanctions to protect our publicfinances and financial systems. We note that theOECD has today published a list of countries assessedby the Global Forum against the internationalstandard for exchange oftax information."

[Statement, G20 Leaders, Pittsburgh, September2009, para. 15]"We welcome the expansión of the Global Forum onTransparency and the Exchange of information,induding the participation of developing countries,and welcome the agreement to deliver an effectiveprogram ofpeer review."

The Global Forum on Transparency and Exchange ofInformation for Tax Purposes is the multilateralframework within which work in the área of transparencyand exchange of information has been carried out by bothOECD and non-OECD economies since 2000. The GlobalForum reports regularly to G20 Finance Ministers andCentral Bank Governors and to Leaders assembled on theoccasion of G20 summits. 121 jurisdictions and theEuropean Union now particípate in the Global Forum,inctuding a growing number of developing countries; afterfour years, most of the members have undergone theirPhase 1 review, and the Global Forum has launched thefirst Phase 2 reviews.

The informal Task Forcé on Tax and Development isworking with the Global Forum to ensure that developingcountries benefit from the new more cooperative tax

environment.

Automatic exchange oftax information:

Work on a common reportíng standard started at the

OECD in October 2012 and has progressed rapidly. Thework was ¡ntended to allow countries to automaticallyexchange information with any other country (subject toappropriate legal arrangements being in place, reciprocity

and confidentiality) and is a major step forward ineffective internationaf tax cooperation to better fíght

Global Forum: After four years from the launch, mostof the members have completed their Phase 1 reviewand the Global Forum now focuses on the Phase 2reviews, which are designed to test the effectivenessof exchange of information practices. At ¡ts annualmeeting in Indonesia in November 2013, the GlobalForum adopted the first batch of overail ratings for50 jurisdictions' compliance with the Internationalstandard; it also established a group on AutomaticExchange of Information (AEOI) and agreed tocontinué monitoring implementation of thetransparency and information exchange standard,whife further developing ¡ts Terms of Reference andreview processes.The Forum also agreed on furtherwork aimed at strengthening the definition of

beneficia! ownership and the availability of this typeof information.

Automatic exchange of Information: At the FM&CBGMeeting in Sydney, on February 21-23, 2014,

Ministers endorsed the Common Reportíng Standardfor automatic exchange of tax information on areciproca! basis. They committed to work with ailrelevant parties, induding the OECD and relevantfinancial institutions, to detail the implementationplan at the September G20 FM&CBG meeting. Inparallel, they expect to begin to exchange

G20 High-leve! Principies on Financial Consumer Protection - Developed by the Task Forcé on Financial Consumer Protection of the OECD Committee on Financial Markets(CMF), in cióse co-operation with the FSB and its Consultative Group, other international organizations, standard setter bodies and consumer and industry associations.http://www.oecd.org/dataoecd/58/26/4889201Q.pdf

Update report on the work to support the ímplementation of the G20 High-teve! Principies on Financial Consumer Protection, OECD, September 2013http://www.oecd.org/daf/fin/financial-education/G20EffectiveApproachesFCP.pdf

Past G20 Commitments OECD contribuí ion and state of play Next stepsfinancial industry.

At the G20 Cannes Summit, 3-4 November 2011, G20Leaders endorsed the high levéis principies on financialconsumar protection with a commftment to fuliy applythese principies across G20 jurisdictions.

The G20 Leaders in Los Cabos approved the Action Planof the G20/OECD Task Forcé on Financial ConsumerProtection to develop effective approaches to theimplementation of these principies. The High-Level

Principies on Financial Consumer Protection endorsedin 2011 by the G20 leaders in Cannes were adopted bythe OECD Council as a Recommendation in July 2012,thereby expanding the coverage of the principies toinclude all OECD member countries.

Following Los Cabos endorsement of the Action plan ofthe G20/OECD Task Forcé on Financial ConsumerProtection, the OECD delivered an update report at theSaint Petersburg Summit focusing on identifyingeffective approaches (i.e. good practices) to supportthe implementation of three (disclosure, responsiblebusiness conduct and complaint handling) of the 10principies.

Referentes - www.oecd.org/EZO/topics/financia!-sector-reform/

OECD/ INFE High-Level Principies on National Strategies for Financial Education, June 2012http://www.oecd.ore/dataoecd/23/34/50641407.pdf

Advancing National Strategies for Financial Education: A Joint Publication by Russia's G20 Presidency and the OECD, 2013http://www.oecd.ore/finance/financial-education/G20 OECD NSFinancialEducation.pdf

OECD/INFE policy guidance on addressing women's and girls' needs for financial awareness and education, OECD, September 2013

http://www.oecd.org/daf/fin/financial-education/G20-Women-Girls-Fin-Ed-Policv-Guidance-20l3.pdf

PastG20 Commitments OECD contribution and state of play Next stepson the issues of formal structure and financial supportto ensure the exchange of best practices. We alsoendorse the Action Plan presented by the G20/OECDTask Forcé on Financial Consumer Protection to deveiopeffective approaches to support the implementation ofthe High Level Principies on Financial ConsumerProtection, and look forward to an update reportby theLeaders' Summit in St. Petersburg in 2013".

fDeclaration. G20 Leaders, St Pete rs bu re, September2013. para. 801

Financial literacy and education:"[We] welcome practical tools to measure finoncialliteracy and evalúate financial education programs,developed by the OECD/International Network forFinancial Education (INFE) and the World Bank Group,support their widespread use in countries along withinstruments to measure youth financial literacy such asthe Programme for International Student Assessment(PISA)."

"(..) [We] welcome progress reports on barriers forwomen and youth in financial inclusión and educationprepared by the OECD/INFE and the World Bank Groupand endorse the OECD/INFE policy guidance onaddressing women and girls' needs for financialeducation."

"(..) We endorse the recommendations of the progressrepon on women andfinance, including that the GPFI,the OECD and the World Bank Group conduct astocktaking of promising and successfui initiatives toenhance women 's financial inclusión."

"(..} We welcome the G20 Russia's Presidency and theOECD publication on national strategies for financialeducation (...)."

The OECD and the INFE delivered a set of High-level

Principies for the Development of National Strategiesfor Financial Education that was endorsed by Leadersat the Los Cabos Summit.

In August 2012, APEC Ministers of Finance,"welcomed the endorsement of the OECD/INFE High-level Principies on National Strategies for FinancialEducation by G20 Leaders at their Summit in Los Cabosand welcome the OECD | INFE, the World Bank andADB's cooperation with the Global Partnership forFinancial Inclusión (GPFI). They also recognized theimportance of financial education for the young andwefcomed the OECD/INFE Guidelines for Financial

Education in Schools. They encouraged theirimplementation in APEC economies, taking ¡ntoaccount economy-wide, regional and localcircumstances. They encouraged the APEC economiesto consider the participation ¡n the Financial literacymeasurement in the Programme for International

Student Assessment (PISA)."

Financial consumer protection

In 2009, based on a worldwide survey of financialconsumer protection systems, the OECD delivered ananalysis addressing financial consumer protection

deficiencies in the post crisis era. This survey foílowsup on earlier extensive policy work by the OECD in thefield of credit, pensión insurance and electroniccommerce. Most importantly, in 2011 the OECDestablished a Task Forcé on Financial ConsumerProtection, which is open to all G20 countries and thatwas extensively consulted in the design of the G20Principies.

When developíng these G20 principies, specialattention was given to consultation with consumersassociations and with representatives from the

Financial Sector Reform

Financial Education and Financial Consumer Protection

Upon íhe request of the G20, the QECD, joiníly with the Financial Stabiiity Board (FSB), developed High-Levei Principies aimed at strengthening FinancialConsumer Protection (FCP), which were endorsed by Leaders at íhe Cannes Summií. The Organization subsequentSy deveioped effectíve approaches ío the

¡mpiementatíon of a first set of these principies that were defjvered to Leaders in St. Peíersburg. ln a similar vein, the OECD/INFE deveioped Hígh-levelPrincipies on National Strategies for Financial Education that were endorsed by Leaders in Los Cabos and is now working on poiicy options for theImpíementation of National Strategies for Financial Education.

PastG20 Commítments OECD contríbution and state of play Next steps[Declaration, G20 Leaders, Cannes, November 2011,

para. 33]"We agree that integration of finandal consumerprotection polides into regulatory and supervisor?frameworks contributes to strengthening finandalstabiiity, endorse the FSB report on consumer financeprotection and the high level principies on finandalconsumer protection prepared by the OECD togetherwith the FSB, We will pursue the full application ofthese principies in our jurisdictions and ask the FSB andOECD along with other relevant bodies, to report onprogress on their implementation to the upcomingSummits anddevelopfurtherguidelines if appropriate."

[Declaration, G20 Leaders, Los Cabos, June 2012, para.

52&S3]"52. On finandal education, we endorse theOECD/Internationai Network on Financial Education

(INFE) High Level Principies on National Strategies forFinancial Education, and cal! on the OECD/INFE and theWorld Bank in cooperation with the GPFI to deliverfurther too/5 to promote finandal education, with aprogress report to the next Summit. For advancing thefinandal consumer protection agenda, we take note ofthe discussion on the Statutes of the InternationalFinancial Consumer Protection Network (FinCoNet) and

At the St Petersburg Summit, main OECO deliverablesincluded:

• Russian/G20/OECD publication on nationalstrategy for finandal education, OECD/INFE reportand poiicy guidance on empowering womenthrough finandal education and awareness;

• Methodologies on measurement of financia!literacy together with the World Bank.

The Organisation developed High-level Principiesdrawing on its long-standing and extensive expertiseon finandal education and financial consumerprotection and building on OECD-sponsored relevantnetworks:

Financial education is indeed a high priority of twoOECD committees - the Insurance and PrívatePensions Committee and the Committee on Financial

Markets. Related work is mainly developed throughthe International Network on Financial Education(INFE), which brings together re prese ntatives fromaround 200 public (mainly financial) authorities from106 countries. In 2005, the OECD published its firstPrincipies and Good Practices for Finandal Awareness

and Education and has subsequently continuad todefine good practice in thisfield.

In St Petersburg, Leaders called on the OECD/INFE todevelop by next Brisbane Summit "international corecompetencies frameworks for adults and youth onfinancial literacy" and "a Poiicy Handbook on theImplementation of National Strategies for FinancialEducation." (Declaration, G20 Leaders, St Petersburg,September 2013, para. 80).

Leaders also called on the G20/OECD Task Forcé on FCPto further report in 2014 on effective approaches tosupport the implementation of other G20 High-LevelPrincipies on FCP.

02/10/2014

Meeting of the OECD Global Parliamentary Network2 October2014, París

G20LABOURANDEMPLOYMENT:THE SOCIAL DIMENSIÓN

Stefano ScarpettaDirector of Employment, Labour and Social Affairs

»OECD

\e G20 Labour and Employment Ministerial'/ meeting Melbourne, 10-11 September 2014

"Prevent structural unemployment, creating betterjobs and boosting participation"

The Task Forcé on Employment that prepared theMinisterial meeting focused, in particular, on:* Developing country employment action plans;* Boosting participation, with a special focus on

youth and women• Identifying suitable policies to prevent increases in

structural unemployment and informality;• Promoting safe and healthy workplaces for all

02/10/2014

Key challenges addressed

Structural unemployment

Long-term unemployment has risenand remains high in many countries

Long-term unemployment1Percsntage o' total unsmptoyrnenl, 2013¡

CDOT[W are ontottd by'S«l»cl8(JuitwarMi1 Pamjniunnm[ilotsdtoiw»y«'0fmora2 Q320ü7-O320ialorlnHiij4ÍirF*tiranSónica. OECD Hirnol» MiM «i viikín amona suivuyj and 110 SIstIHci stran-Ttm Imlgaiora

02/10/2014

Large employment differencesbetween groups

Employment rates by socío-demographiccharacteristlcs

Perceniage oí Vía populatlon olths iid ¡caled group. 2013'

Counln» ve arúaiad by ucwiiJInc ofdaf tf [fw pim«4p fnal» litnur lona pwHcipiDon WBI in?D13' SdactM uitaii UH>1 »10(orCWRi.!Oi1-i!lorlnai«.ail!loTBmi™, inÚQ32013((nln[(w»M2 foulh tW>rs ID poncni ad lí-14 lor CUna, Splln. M LWted Kngdom •><!«• UnrlM SW», Olcto psíumi »(»rj lo pnSoura; OECDLiboui Fon» SraBKIcs CUdía» aM natoíuí iiboír bus lunvyi


Poor youth employment outcomes

02/10/2014

\\Many youth are unemployed or inactive andff not involved in education

Youth unemploymenl rateerceniage of iha labour lores ageo 16/16-24, Q4 2COT-Q2 2014!

oidaí tf [ha youth unanplovmBntnT« m 09 2014

2 »rií12foilrKl«,zo10forChn«.Q4!OI3lciíAiBmlni.«naoiaiJloíBiKilnoVM«i^sF*jiiiinF«*ralloii, S«uOI Amas SouthTuikay and VIP Unlied KtaflobroSoiice: ÜECD cafculsllmi MiM ai OECD Slmrl-rtnrv lama UiiM SlifsKs Dititua. 110, Shon-bim IndcaBn ot U» bbouiCanBJB dntt loi Chrrv and NMonal Samóla Suivey lor Inda

«lucí ^^^1

'"

Job quality is often poor for youth and skillsmismatch is frequent

Incidence of temporary employment, 2013M a parcarl of al emoloyees In each group*

• Youth «Adulta

Incidence of informal employment, 2011As a percenl oí all smptaysas in each group1

«Adufts

....Illlllll1<r

02/10/2014

Setter youth employment outcomesessential for growth and social cohesión

See: OECD and ILO (2014), Promoting Betíer Labour Marfref Outcomes for Youth, reportprepared for the G20 Labour and Employment Ministerial Meeting, Melboume, 10-11September2014.


Promoting greater gender equality

02/10/2014

Large gender gaps remain ¡n labourpartícipation, access to quality Jobs and pay

Gender gaps for the G20 median economy

Particípationrate

-26% points

incidence of self-empíoyment

-3.5% poínts

Source: OECD estímales.

Employmentrate

-26% points

Earnings

-19%

Gradually closing gender gaps would boostgrowth and well-beíng in G20 countries

Impact of closing the gendergap ¡n participation on G20 iabourforcé growth, 2014-2050Millions

2SOO

2700

2600

2500

2400

2300

2200

2100

Closfnglhegenaergap

Jív ¡tbour lona ftroítctiofísii'vOfaea QII paptilatiaiifín>ífc1ioní¡orpvwfaagea¡S^UfHK.Iir5-r«artgogfoiI 0uitn* Patttci{iallontaaa*nprvi6&fdlryta3ifnliigthaltakourtorc99fitw nrf exH <a*s tiy gtntar tna S-

Omiitiimiif id» onr fitft!tod2(W-¡Otl ROÍB-ÍOIO lar Clem>.!. Cltilng B» gwitoi W-- Tlv yinder yo In perKífflafi tata wottonifgt populKiwi Í1S-S*> m !0tl ts ¡sumía

. OECD(»WKllwM tastd an «¡i OECD PQpiM i ameasísnO Hit

02/10/2014

Comprehensive policies are needed toimprove access to quality Jobs for women

See: OECD, ILO, IMF and World Bank (2014), Achieving Strongar Growf/i by Pmmoling a More Gender-BalancedEconomy, report preparad for the G20 Labour and Employmenl Ministerial Meellng, Melboume, 10-11 Seplember 2014..

Response of G20 Labour Ministers: declaration on"Preventing structural unemployment, creating better

jobs and boosting participaron"

See. G20 Labour and Émployment Ministerial Declaration, Melboume, 10-11 Seplembef 2014

02/10/2014

Thank you

Read more about the OECD's work on youth, gender,job quality and much more:

Website: www.Qecd.org/employment/outlookFollow us on Twitter : OOECD Social

GLOBAL VALUÉCHAINS

CHALLENGES,

OPPORTUNITIESAND

IMPLICATIONS FOR POLICY

OECD Global Parliamentary Network meetingParís, 2October2014Trudy Witbreuk, Head of the Development División, OECDTrade and Agricultura Directorate Á

•»OCDE

GVC participation, 1995 and 2009

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conlact ustad.contact (5) oecd.org

EXPLANATORY STATEMENT: 2014 DELIVERABLES - 3

Introduction

Addressing base erosión and profít shifting (BEPS) is a key priority ofgovernments around the globe. OECD and G20 countries, working togetheron an equal footing, adopted a 15-point Action Plan to address BEPS.Beyond securing revenues by realigning taxation with economic activitiesand valué creation, the OECD/G20 BEPS Project aims to créate a single setof consensus-based international tax rules to address BEPS, and henee toprotect tax bases while offering íncreased certainty and predictability totaxpayers. A key focus of this work is to elimínate double non-taxation.However in doing so, new rules should not result in double taxation,unwarranted compliance burdens or restrictions to legitímate cross-borderactivity.

This document contains the first set of reports and recommendations toaddress seven of the actions in the BEPS Action Plan published in July2013. Given the Action Plan's aim of providing comprehensive andcoherent solutions to BEPS, the proposed measures, while agreed, are notyet formally finalised as they may be impacted by some of the decisionstaken with respect to the 2015 deliverables with which they interact. Theydo reflect consensus on a number of solutions to put an end to BEPS.

With the adoption of this first set of deliverables and the implementatíonof the relevant measures by national governments, hybrid mismatches willbe neutralísed; treaty shopping and other forms of treaty abuse will beaddressed; abuse of transfer pricing rules in the key área of intangibles willbe greatly minimised; country-by-country reporting will providegovernments with informatíon on the global allocatíon of the profits,economic activity and taxes of multinational enterprises (MNEs).

Equally, OECD and G20 countries have agreed a report concluding it isfeasible to implement BEPS measures through a multilateral instrument.They have also advanced the work to fight harmful tax practices, inparticular in the área of IP regimes and tax ruüngs. Finally, they havereached a common understanding of the challenges raised by the digitaleconomy, which will now allow them to deepen their work in this áreawhere BEPS is exacerbated.

BEPS by its nature requires coordinated responses, particularly in theárea of domestic law measures. This is why countries are investing time andresources on developing shared solutions to common problems. At the sametime, countries retain their sovereignty over tax matters and measures maybe implemented in different manners, as long as they do not conflict withtheir international legal commitments.

O OECD 2014

4 - EXPLANATORY STATEMENT: 2014 DELIVERABLES

A. Background

In a context of severe fiscal consolidation, the G20 Leaders haveidentified the need to address BEPS as one of their priorities. At theirmeeting in Saint Petersburg in September 2013, they endorsed the ambitiousand comprehensivo Action Plan developed within the OECD, with all G20countries. They have also called on countries to examine how their domestictax laws contribute to BEPS and to ensure that international and domestictax rules do not allow or encourage MNEs to reduce overall laxes byartifícially shifting profíts to low tax jurisdictions. The Action Plan aims toensure that profits are taxed where economic activities generating the profitsare performed and where valué is created.

It was agreed that addressing BEPS is critica! for countries and must bedone in a timely manner, not least to prevent the existing consensus-basedinternational tax framework írom unravelHng, which would increaseuncertainty for businesses at a time when cross border investments are morenecessary than ever. As a result, the Action Plan provides for 15 actions tobe delivered by 2015, with a number of actions to be delivered already in2014.

The OECD Committee on Fiscal Affairs (CFA), bringing together 44countries on an equal footing (all OECD members, G20 and Accessioncountries), has adopted a first set of seven deliverables described in theAction Plan and due in 2014. Developing countries and other non-OECD/non-G20 economies have been extensívely consulted throughnumerous regional and global fora meetings and their input has been fed intothe work. It has also informed the development of a two-phase report for theG20 Development Working Group. Business representatives, trade unions,civil society organisations and academics have also been very involved inthe process through opportunities to comment on discussion drafts whJchhave generated more than 3 500 pages of comments discussed through fívepublic consultation meetings and three webcasts which attracted over 10 000viewers.

In accordance with the BEPS Action Plan, the 2014 deliverables focuson:

1. designing new international standards to ensure the coherence ofcorporate income taxation at the international level (throughrules to neutralise hybrid mismatch arrangements — Action 2)

2. realigning taxation and relevant substance to restore theintended benefits of international standards both in the área ofbilateral tax treaties (preventing treaty abuse — Action 6) and inthe área of transfer pricing (assure that transfer pricing outcomes

O OECD 2014


are in line with valué creation in the área of intangibles -Action 8);

3. ensuríng better transparency for tax administrations and betterconsistency of requirements for taxpayers through improvedtransfer pricing documentation and a témplate for country-by-country reporting (Action 13).

Moreover, the CFA has agreed three important reports which addressthe cross cutting issue of addressing the tax challenges of the digitaleconomy (Action 1), the feasibility of the development of a multilateral¡nstrument as one means of enabling jurisdíctions to implement measuresdeveloped in the course of the BEPS work and, as a result, modify thenetwork of bilateral tax treaties (Action 15) and finally, a report on progressmade to counter harmfiíl tax practices more effectively, taking into accounttransparency and substance (Action 5).

B. Achievements — the seven 2014 deliverables

With this fírst set of deliverables, the OECD/G20 Project has gone along way in achíeving consensus on key measures to address BEPS.Implementation of the measures recommended in the diíferent deliverableswill address BEPS in some key pressure áreas which were identifíed in thereport Addressing Base Erosión and Profit Shifting endorsed by G20Finance Ministers in February 2013. While agreeing on a set of new rules,countries have been mindful of the need to Hmit uncertainty and provide asound and fair tax environment to business and investors. Fighting BEPSshould not result in harming growth and the investment climate.

Jurisdíctions can begin to ímplement recommendations for co-ordinateddomestic tax legislation and tax treaty provisions to neutralise hybridmismatch arrangements. These provisions, once translated into domestic lawand tax treaties, will elimínate mismatches and put an end to costly múltipledeductions for a single expense, deductions in one country withoutcorresponding taxation in another or the generation of múltiple foreign taxcredíts for one amount of foreign tax paid. Further implementing guidancewill be developed with input from stakeholders to ensure that therecommended rules are clear; operational for both taxpayers and taxadministrations and that they strike a balance between compliance costs andneutralising a tax benefít from a mismatch. Also there is an interaction withother actions in the BEPS Action Plan, particularly Action 3 (strengthencontrolled foreign company (CFC) rules) and Action 4 (Hmit base erosiónvia interest deductions and other fmancial payments), on which fürtherguidance will be required. In addition, there are two pending issues relatingto intra-group regulatory capital and the consequences of CFC inclusión

OOECD2014

6 - EXPLANATORY STATEMENT: 2014 DELIVERABLES

where no consensus has yet been reached. Work will continué on theseissues and until such work has been completed and a consensus reachedcountries are free in their policy cholees in these áreas. The outcome fromthis further work, together with the implementing guidance will bepublished no laterthan September 2015.

The OECD/G20 BEPS Project has also reinvigorated the fightagainst harmful tax practices. This work focuses on reducing thedistortionary influence of taxation on the location of mobile financial andservice activities, thereby encouraging an environment in which free and fairtax competition can take place. This is essential in moving towards a "levelplaying field" and a continued expansión of global economic growth andcountries agree that harmful tax practices should be tackled urgently. In thisárea, work has accelerated with significant progress on improvingtransparency on rulings and of considera tí on of intcllectual property(EP) preferential regimes and methodologies to assess substantialactivity in these regimes and others.

Treaty shopping and other treaty abuse strategies undermine taxsovereignty and deprive countries of revenue. Action 6 provided fordeveloping model tax treaty provisions that would restore the bilateralnature of tax treaties and grant treaty benefits only in appropriatecircumstances. All countries have agreed that anti-treaty abuse provisionsshould be included in tax treaties. It is recognised that different instrumentscan be used either alternatively or cumulatively. A minimum standard hasbeen agreed upon and this will ensure that treaty shopping and other treatyabuses are no longer possible, while flexibility is provided for governmentsto include instruments that are fit for purpose to their specific situation. It isalso recognised that the work on treaty abuse may impact existing businessstructures and may reveal a need for improvements of existing policies inorder not to hamper investments, trade and economic growth. For example,policy considerations will be addressed to make sure that these rules do notunduly impact collective investment vehicles (CIVs) and non-CIVs funds incases where countries do not intend to deprive them of treaty benefits.Finally, additional work is needed with respect to the contents of the modelprovisions and the relevant Commentary, in particular the limitation onbenefits rule. Further work on these model treaty provisions and relevantCommentary and with respect to the policy considerations relevant to treatyentitlement of CIVs and non-CIVs funds will be fmalised by September2015.

The heavy and growing reliance of modera business on intangibleproperty and the risk of BEPS through transfers of intangibles made itessential to clarify the transfer pricing rules in this área. Clarity will be goodfor both governments and investors in an área where rules were not

OOECD2014


sufficiently developed. Action 8 called for such clarifícation, which isreflected in a revisión of the Transfer Pricing Guidelines. At the same time,significant progress has been made in addressing the serious concern raisedby the separation of the location of the return on intangible property and thelocation where economic activities take place and valué is created. There isconsensus that artificial shifting of profít to no or low tax environmentjurisdictions (such as through "cash boxes") can no longer be tolerated.Draft guidance has been developed for intangibles. However, it is alsorecognised that the 2015 work relating to the transfer pricing treatment ofrisk and capital and relating to the special measures that may be consideredin this área, will infíuence the final outcomes of the work on intangibles. Forthat reason the rull outcomes of the BEPS Action Plan on issues relating tointangibles will not be finalised until completion of the guidance relating towork on Actions 8, 9 and 10. Due consideration will be paid to make surethat the revised rules reconcile the location where profits are reported for taxpurposes with economic activities and valué creation, without increasinguncertainty.

In a major step forward in transparency, improved and bettercoordinated transfer pricing documentaron has been agreed, which willincrease the quality of information provided to tax administrations and limitthe compliance burden on businesses. In addition to a master file and localfiles to be provided by multinational companies, a témplate for country-by-country reporting to tax administrations has been agreed. The country-by-country reporting will provide a clear overview of where profits, sales,employees, and assets are located and where taxes are paid and accrued. Thecountry-by-country reporting témplate provides enough flexibility to limitcompliance costs, while ensuring that tax administrations will nave a veryuseful tool for risk assessment. The CFA has also agreed to review theadequacy of the scope of the informaíion required no later than the end of2020. This major achievement will require careful implementation, inparticular as regards the way to transmit sensitive information, and guidancein this respect will be developed by February 2015.

In order to implement BEPS measures in a fast and effective manner,the BEPS Action Plan provides for the development of a multilateralinstrument. After consultaron with public international law andinternational taxation experts, the CFA has concluded that amultilateral legally binding instrument to achieve this is fea si ble andcould be developed soon to at least incorpórate tax treaty related BEPSmeasures. It is recommended that a mándate be drafted for countries tofurther consider negotiating such an instrument. This instrument has thepotential to be cost efficient to governments, whíle providing more certaintyto business.

O OECD 2014

Last and not least, coramon understanding has been reached on the keyfeatures of the digital economy. It has been agreed that because the digitaleconomy is increasingly becoming the economy itself, it would be difficult,if not impossible, to ring-fence the digital economy from the rest of theeconomy for tax purposes. However, it is also recognised that the businessmodels and key features of the digital economy exacérbate BEPS risks andtherefore must be addressed. It is expected that the other actions will addressthese risks but at the same time a* number of specific issues have beenidentifíed which must be taken into account when doing the work(permanent estabíishment issues, importance of intangibles and use of dataand possible need to adapt CFC rules and transfer pricing rules to the digitaleconomy). A number of broader direct tax challenges have also beenanalysed, such as the ability of a company to have a signifícant digitalpresence ín the economy of another country without being Hable to taxationdue to the lack of nexus and further work will be carried out to evalúate theirscope and urgency and potential options to address them. Finally, challengesin the área of indirect laxes in relation to business to consumer transactionshave also been identifíed and will be addressed by 2015.

C. 2015 Actions and follow up

As reflected in the previous section, the 2014 deliverables are closelyconnected to 2015 deliverables. Indeed, the Action Plan was conceived toprovide solutions in a holislic and comprehensive manner. Sequencing theactions should not hamper the comprehensiveness of the solutions to BEPS.The fírst set of deliverables must be seen in that context. As a result therecommendations will remain in draft form so that the potential impactof the 2015 deliverables can be incorporated before finalising them. Forínstance, the work on the transfer pricíng aspects of intangibles includessections still bracketed as they cannot be fínalised before Actions 9 and 10are delivered.

Moreover, the highly technical nature of the actions requires carefulimplementation, and guidance will have to be developed Ín 2015. This ís forinstance the case in the área of hybrid mismatch arrangements where acommentary on the recommended domestic provisions wíll have to bedeveloped and the área of treaty abuse where improvements will have to bemade to make the model treaty provisions and related commentary fit forpurpose for economies with different characteristics. Equally, theimplementation aspects of the country-by-country reporting témplate, inparticular the modalities for fíling and dísseminating the information to taxadministrations, will require detailed work later this year and in 2015.

OOECD20H

ACKNOWLEDGING the important role that the multilateral Convention on Mutual AdministrativoAssistance in Tax Matters can play in facilitating rapid implementation of automatic exchange ofinformation and WELCOMING the fact that over 60 countries have already signed the Convention,including almost all OECD countries, all G20 countries, and a growing number of financia! centres anddevelopíng countries;

WELCOMING the recent estabíishment by the Global Forum of a Working Group on AutomaticExchange of Information, which will develop a mechanism to monitor and review the implementation ofthe new single global standard for automatic exchange of information and also a framework to offertechnical assistance to developing countries in meeting the standard.

1. DECLARE that we are determined to tackle cross-border tax fraud and tax evasión and topromote international tax compliance through mutual administrative assistance in tax matters and a levelplaying field;

2. CONFIRM that automatic exchange of financia! account information will further these objectivesparticularly if the new single global standard, including full transparency on ownership interests, isimplemented among aü financial centres;

3. ACKNOWLEDGE that information exchanged on the basis of the new single global standard issubject to appropriate safeguards including certain confídentiality requirements and the requirement thatinformation may be used only for the purposes foreseen by the legal instrument pursuant to which it isexchanged;

4. ARE DETERMINED to implement the new single global standard swiftly, on a reciprocal basis.We will transíate the standard into domestic law, including to ensure that information on beneficialownership of legal persons and arrangements is effectively collected and exchanged in accordance with thestandard;

5. CALL on all fmancial centres to implement the new single global standard without delay;

6. UNDERLINE the need for assistance to be provided to developing countries so that they may beable to reap the benefits of this form of co-operation;

7. URGE the OECD Committee on Fiscal Affairs, working with G20 members, to proceed rapidlywith the eiaboration of a) a detailed commentary to help ensure the consistent application of the new singleglobal standard and b) the remaining technical modalities and safeguards including information andguidance on the necessary technical solutions, a standard formal for reporting and exchange, and mínimumstandards on confídentiality;

8. EXPECT that the remaining elements of the work referred to in paragraph 7 will be fínalised andapproved by míd-2014;

9. ENCOURAGE all countries that have not already done so to sign and ratify the multilateralConvention on Mutual Administrative Assistance in Tax Matters without further delay;

C/MIN(2014)5

10. EXPECT the swift establishment by the Global Forum of a mechanism to monitor and review theimplementation of the new single global standard;

11. INVITE the Secretary-General of the OECD to report on the Committee on Fiscal Affairs'progress in developing further guídance on the implementation of the new single global standard at the2015 Meeting of the Council at Ministerial level and at other international fora as appropriate.

OECD/G20 Base Erosión andProfit Shifting Project

FREQUENTLYASKEDQUESTIONS

OECDSETTER POLICIES FOR SETTER LIVES

: {\.

Content

This document has been prepared by the OECD Secretariat. It contains frequently asked questionsand answers related to the BEPS Project.

Specifically, the questions and answers relate to:

A. The 2014 BEPS Deliverables (Page 4)B. 2014 BEPS Deliverables and Developing Countries (Page 13)C. Planned next steps (Page 14)D. Background on BEPS (Page 15)

Further Information

To find out more about the BEPS Project, please visit our website www.oecd.orfi/tax/beps.htm, orcontact:

• Pascal Saint-Amans, Director, OECD Centre for Tax Policy and AdmtnistrationE-mail: £ascaLSaint-Amans@_oecd_.orq

• Raffaele Russo, Mead of the BEPS Project, OECD Centre for Tax Policy and AdministrationE-mail: [email protected]

A. The 2014 BEPS Deliverables

1. What are the 2014 deliverables about?

The 2014 deliverables tnclude measures that will help ensure the coherente of corporate incometaxation at the international level, restore the intended effects and benefits of internationalstandards, and ensure better transparency and promote increased certainty and predictability.Specifically, they include 3 reports:

• two final reports on the Digital Economy (Action 1) and the Feasibility of a MultilateralInstrument (Action 15);

• one interim report on Harmful Tax Practices (Action 5); and

Draft Rules in 4 áreas:• Hybrid mismatch arrangements (Action 2)• Treaty abuse (Action 6)• Transfer pricing of intangibles (Action 8)• Transfer pricing documentation and a country-by-country reporting témplate (Action 13}

2. How wilt the 2014 deliverables tackle base erosión and profít shifting?

The first set of measures and reports released today represent substantial progress towardseliminating double non-taxation due to base erosión and profit shifting. These measures, combinedwith the work to be completed in 2015, will give countries the tools they need to ensure that profitsare taxed where economic activities generating the profits are performed and where valué is.created, while giving business greater certainty by reducing disputes over the application ofinternational tax rules.

3. When do these measures become applicable?

The measures will apply once they are ¡mplemented, either in domestic laws or in the network ofbilateral tax treaties. In that respect, we are developing a mándate to cali an internationalconference to develop a multilateral convention that would amend the network of existing bilateraltax treaties at one time. Further guidance and work with respect to ¡mplementation has alreadybegun, and will be completed during the course of 2015.

4. Whv won't so me of the measures be finalised until later?

Except for some pending technical issues where further work ¡s required in order to reachconsensus, all countries have agreed to the proposed measures contained in the 2014 reports.Because the BEPS Project takes a comprehensive and holistic approach to solving the problem ofbase erosión and profit shifting, consideration shall be gtven to the interactions between the 2014measures and the 2015 ones. For this reason the 2014 measures are agreed but will formally remainin draft form.

5. How much revenue will these 2014 measures produce for governments?

Implementation of these measures, combined with the measures to be completed in 2015, will levelthe playing field and restore fairness and common sense to the international tax system by ensurtngthat busínesses that opérate cross-border and have access to sophisticated tax expertise will nothave unintended competitive advantages relative to busínesses operating at the domestic levet. Thework is therefore about aligning taxation with economic activities and valué creatton, rather thanabout increasing overall tax burden. The work under Action 11 of the BEPS Action Plan, to befinalised in 2015, will help us better understand the total impact of base erosión and profit shifting,and will also help us monitor the impact of the measures ¡mplemented to address it.

The report provides a detailed analysis of the digital economy, its business models, and its keyfeatures. There is now agreement that, because ¡nformation and communication technology hasspread across the economy, it is not possible to "ring fence" the digital economy for special taxtreatment. There is also agreement that while the digital economy does not créate unique BEPSissues, some of its features exacérbate existing issues. The report identifies these key features sothat the work under the rest of the Action Plan can address them effectively. In the context of VAT,the report concludes that VAT collection in the business-to-consumer context urgently needs to beaddressed, and work in this área will be completed by the end of 2015. This work will realigntaxation of the digital economy with economic activities and valué creation.

7. What types of new business models does the report analyse?

The report examines a number of new business models, as well as oíd business models that havechanged in scale because of the digital revolution, including e-commerce, payment services, appstores, cloud computing, high frequency trading, participative network platforms and onlineadvertising. The report also contains an examination of the tax structures that these businessmodels allow (Annex 2).

8. Do we need more fundamental changes to the internationat tax system to deal with the digitaleconomy?

The report recognises that the changes brought about by the digital economy raise systemicchallenges regarding the ability of the current international tax framework to ensure that profits aretaxed where economic activities occur and where valué is created. The report discusses a number ofpotential options to address these challenges and concludes that more technical work needs to bedone to develop those options. In addition, the fact that the other work to address BEPS is ongoingmakes it difficult to evalúate both the extent of these systemic challenges and the impact of thepotential options to address them. The impact of that other work will be evaluated during 2015, andthe evaluation of options will be completed by the end of the project ¡n 2015.

9. Is the report proposing a virtual permanent establishment.? Why?

The report is not recommending the adoption of a virtual permanent establishment standard. Thereport does outline potential options to address the broader tax challenges of the digital economyincluding a new threshold for taxation based on a Significant Digital Presence. Under such aproposal, an enterprise engaged in a 'fully demateriatised digital activities' could be deemed to havea taxable presence in a country if it maintained a 'significant digital presence'. The report recognisesthat further work needs to be done to explore these options, particularly in relation to theirtechnical details, and in light of the Action Plan as a whole. The Task Forcé on the Digital Economywill continué to work on the options in order to flesh them out, prpvide more detall and evalúatethem according to an agreed framework.

For further ¡nformation, picase read the report Addressing the Tax Challenges ofthe Digital Economyavailable on line: www.oecd.orR/tax/beps-2014-detiverables.htm

Action 2 -Neutralise the effects of hybrid mismatch arrangements

10. What are hybrid mismatches?

Hybhd mismatches are cross-border arrangements that take advantage of differences in the taxtreatment of financial Instruments, asset transfers and entities to achieve "doubte non-taxation" orlong term deferral outcomes which may not nave been intended by either country. The work onAction 2 of the BEPS Action Plan has focussed on those hybrid mismatch arrangements that lowerthe total tax burden of the parties by exploiting differences in the tax treatment of an entity orinstrument under the laws of different jurisdictions to produce múltiple deductions for the sameeconomic expense (double deduction), or a deduction without any symmetrical taxation(deduction/non-inclusion). A common example of a hybrid financial instrument would be aninstrument that is considered a debt in one country and a share in another so that a payment underthe instrument is deductible when it is paid but is treated as a tax-exempt dividend in the country ofreceipt.

11. How do the 2014 rules tackle hybrid mismatches?

The work sets out general and specific recommendations for domestic hybrid mismatch rules andmodel treaty provisions which will put an end to múltiple deductions for a single expense anddeductions in one country without corresponding taxation in another. Once translated intodomestic law and tax treaties, the recommended rules will neutralise the effect of hybrid mismatchwithout disturbing any other tax, commercial or regulatory outcomes. The domestic rulesrecommended in the report are self-executing and are designed to co-ordinate with the rules in theother jurisdíction. Work will now be undertaken on the devetopment of guidance, in the form of acommentary to the rules, which explains how the rules should opérate in practice. Carefulconsideration will be given to the ¡mplementation of the rules.

12. Do you expect difficulties in the implementation of the domestic law rules?

The recommended rules have been designed to be clear and precise to facilítate implementationand administration. The commentary to the rules will provide taxpayers and tax administrations withpractica! examples illustrating how the rules should be applíed. Once implemented, the rules shouldapply to taxpayers and arrangements automatically without the need for further intervention by thetax authority.

13. How will countries and taxpayers co-ordinate the apptication of the hybrid mismatch rules?

The recommendations also include an ordering rule which prevenís more than one country applyingtheir domestic hybrid mismatch rules to the same arrangement. The combination of automaticapplication and rule ordering avoids the risk of double taxation by ensuring that domestic rules ¡ndifferent jurisdictions do not overlap. The examples included in the commentary will further¡Ilústrate the co-ord¡nation elements of the rule and the consisten! implementation and applicationof the same rules in each jurisdiction should result in more predictable outcomes for taxpayers thanis presently the case.

14. What happens if countries do not introduce the rules?

The recommendations include a defensive rule that a country can apply to neutratise a hybridmismatch that arises within its jurisdiction when the counterparty jurisdiction does not have its owndomestic hybrid mismatch rules. The effect of having both a primary and a defensive rule is that acountry does not need to rely on the domestic laws of another country ¡n order to neutralise hybridmismatches.

15. WEII these rules address structures that use the US Check the Box Regulations?

Yes, when these rules are used to créate hybrid entities. The rules are ¡n fact designed to neutralise

the effect of hybrid entities. Therefore, once implemented by a country, they will neutralise thehybrid mismatch effects of check the box planning in those countries.

For further Information, please read the report Neutralising the Effects of Hybrid MismatchArrangements available on line: www.oecd.Qrfi/tax/beps-2014-del|verables.htm

Action 5 - Counter harmful tax practicas more effectively, taking into accounttransparency and substance

16. How is the BEPS Project addressing harmful tax competition?

The work on harmful tax competition within the OECD began more than 15 years ago. The reportHarmful Tax Competition: An Emerging Global Issue (OECD, 1998) laid the foundations for this work.To counter harmful tax practices more effectively, the BEPS Action Plan mandated a revamp of thework on harmful tax practices, with a priority and renewed focus on requiring substantial activity forany preferential regime and on ímproving transparency, ¡ncluding compulsory spontaneousexchange on rulings related to preferential regimes.

17. Why ¡s transparency important and how is the work under Action 5 addressing this?

The lack of transparency in the operation of a regime will make it harder for the home country totake defensive measures. One of the two key priorities for the revamp of the work on harmful taxpractices mandated by the BEPS Action Plan is to improve transparency. The 2014 Interim Reportdescribes the framework agreed by countries for compulsory spontaneous exchange on rulingsrelated to preferential regimes. Where countries have the legal framework to start exchanging theinformation covered by the framework, the intention would be to start to apply it from the end of2014. Further work on Ímproving transparency will include the review of actual ruling regimes inMember and Associate Countries.

18. Does the BEPS Project address rulings?

Taxpayer-specific rulings, i.e. rulings that are specific to an individual taxpayer and on which thattaxpayer is entitled to rely, are addressed. Where they relate to preferentiai regimes, there will bean obligation on countries to spontaneously exchange information on those rulings under theframework on transparency. Taxpayer-specific rulings can be given both pre-transaction (thisincludes advance tax rulings or clearances and advance pricing agreements) and post transaction.General rulings, i.e. rulings that apply to groups or types of taxpayers or may be given ¡n relation to adefined set of circumstances or activities, will be considered atongside taxpayer-specific rulings inthe context of the further work on transparency which will consider the actual ruling regimes ofMember countries and Associate countries against the factors in the 1998 Report.

19. What are "patent boxes"?

A "patent box" is a preferential tax regime offered by a country to support growth and innovation. Acountry will offer a tax incentive, such as a lower rate of corporate tax, to encourage companies tolócate activities associated with the development, manufacture and exploitatíon of patents in thatcountry.

20. Are patent boxes useful or harmful?

Fostering innovation is an important element of growth strategies because intangibles such aspatents have become one of the key valué drivers of many business models. A preferential regime isuseful in supporting growth and innovation in a country if it attracts real activity. It is not so if itmerely encourages companies to shift profits from the location ¡n which the valué was actuallycreated to another location where they may be taxed at a lower rate.

21. How does the OECD's work affect patent boxes?

One of the key priorities of the BEPS Project has been to focus on whether or not there is substantiatactivity associated with any preferential regime. The inttial focus of this work has been onpreferential regimes related to intangible property ()P) and 15 of these regimes are identified in theintertm report. Several approaches, with the common goal of ensuring that profits are taxed wheresubstantial activities take place, have been explored. Much of the work has been on the nexusapproach, which makes a link between the expenditure tncurred in a country (essentially capturingthe work or activity undertaken) and the amount of income that can benefit from a preferentialregime. The next step is to reach consensus on the best approach to evalúate substantial activity soas to review the 15 IP regimes in the light of the newly elaborated substantial activity factor. Thenewly elaborated substantial activity factor will also be applied to other preferential regimes that fallwithin the Forum on Harmful Tax Practice's remit. The other key priority of the revamp of the workon harmful tax practices ¡s to improve transparency. Therefore regimes, including the IP regimes,may also subsequently need to be reconsidered in the light of the elaborated transparency factor.

For further information, please read the interim report Countering Harmful Tax Practices MoreEffectively, Taking into Account Transparency and Substance available on Une:www.oecd,Qrg/tax/beps-2014-delÍverabies.htm

Action 6 - Prevent treaty abuse

22. What is "treaty shopping"?

"Treaty shopping" generally refers to arrangements through which a person who is not a resident ofone of the two States that concluded a tax treaty may attempt to obtain benefits that the treatygrants to residents of these States.

23. What is the best way to address treaty shopping?

As part of the work on Action 6, OECD and G20 countries have all agreed to clearly reject treaty-shopping practices. Different anti-abuse rules can be used for that purpose and the work putsforward drafts of: (i) a specific anti-abuse rule based on a "limitation-on-benefits" provisión, and (ii)a more general anti-abuse rule based on a "principal purpose test".

24. Will countries be able to fight treaty shopping as they wish?

Yes, but OECD and G20 Countries have also agreed on a common minimum standard which willrequire the adoption, at a minimum, of either (1) a combination of the "limitation-on-benefits" ruleand of the "principal purpose test" rule; (2) the inclusión of the "principal purpose test" rule, or (3)the inclusión of the "limitation-on-benefits" rule supplemented by a mechanism that would dealwith conduit financing arrangements.

25. Why does the work on Action 6 propose so many dlfferent anti-abuse rules? Wouldn't the generaltreaty-anti abuse rule have been suffícient?

Treaty abuse, Mke the abuse of domestíc law, is best addressed through a combination of specificanti-abuse rules, which provide greater certainty but can only deal with known abusive strategies,and general anti-abuse rules or judicial doctrines, which are less certain but offer protection againstabusive transactions that have not previously been identified or addressed.

26. When will the treaty-anti abuse rules that are included in the report be included in the OECDModel Tax Convention?

The rules included in the report are still in draft form and will be included in the next update to theModel. The report indicates that further work is needed with respect to the precise contents of themodel provisions and related Commentary included in the report, ¡n particular the limitation-on-benefits rule. Further work is also needed with respect to the implementation of the minimumstandard adopted to address treaty shopping and with respect to the treaty entitlement of variousinvestment funds. It will also be necessary to take account of the interaction between tax treatiesand the recommendations for the design of new domestic anti-abuse rules that may result from thework on other parts of the Action Plan, ¡n particular Action 2 (Neutralise the effects of hybridmismatch arrangements), Action 3 (Strengthen CFC rules), Action 4 (Limit base erosión vía ¡nterestdeductions and other financial payments) and Actions 8, 9 and 10 dealing with Transfer Pricing.

For further information, picase read the report Preventing the Granting of Treaty Benefits inInappropríate Circumstances available on une: www.oecd.org/tax/beps-2014-deliverabjes.htm

Action 8 - Assure that transfer pricing outcomes related to intangibles are in linewith valué creation

27. Why is the BEPS Project only considering the "arm's length principie" for dealing with transferpricing issues? Aren't other approaches like "formulary apportionment" more appropriate?

In most cases, particularly in contexts where two countries with broadly similar tax systems areinvolved, the arm's length principie effectively and efficiently allocates the income of multinationalsamong taxing jurisdictions. Problems start aristng, however, when third countries, with no or verylow tax rates, are tnterposed, particularly in cases ¡nvolving transfers of intangibles, allocations ofrisks, and capital, and other high-risk transactions. In completing the transfer pricing work requiredby the end of 2015, consideration will be given to both the application of the arm's length principieand special measures in order to identify effective responses to the concerns raised in the BEPSAction Plan. Work on those speciat transfer pricing measures ¡s ongoing and will be co-ordinatedwith other BEPS work on the deductibility of ¡nterest, the permanent establishment definition, CFCrules, digital economy issues, and work on dispute resolution.

Conversely, the adoption of alternative transfer pricing methods like formulary apportionmentwould require development of an international consensus on a number of key issues {whichcountries do not believe to be attainable in the short or médium term) and could also raise systemicproblems which could result ¡n even more damaging problems for countries' revenues. Accordingly,it is believed that ¡t will be most productive to focus on directly addressíng the specific issues arisingunder the current arm's length system.

28. What issues does the work on Action 8 cover and what is the expected impact?

The work on the transfer pricing aspects of intangibles has resulted in revisions to the TransferPhcing Guidelines. These revisions clarify among other things the definition of intangibles, provideguidance on identifying transactions involving intangibles, and provide supplemental guidance fordetermining arm's length conditions for transactions involving intangibles. The guidance, ¡nconjunction with further work to be completed in 2015, will ensure that profits associated with thetransfer and use of intangibles are allocated in accordance with valué creation, and will hinder BEPSstructures based on the nominal allocation of intangibles to a low tax environment.

29. Does the new guidance address the issues related to corporate synergies and location savings?

Yes, it does. The guidance ascertains that the benefits from corporate synergies are allocated to thegroup members that have contributed to these synergetic benefits and makes sure that thesebenefits cannot be isolated and allocated to an entity in a low tax environment. The guidance onlocational advantages secures that it is clearly ascertained whether such benefits exist and ¡f so,leads to an allocation of these advantages in a way that reflects the market circumstances that existin the specífic situation.

30. Why are certain sections bracketed?

Guidance has also been developed ¡n relation to the ownership of intangibles, intangibles whosevaluation is uncertain at the time of the transaction, and the application of profit splits and othermethods. However, a decisión has been made not to finalise the work on this draft guidance due tothe strong interactions with the work to be finalised by 2015, in particular in retation to the transferpricing aspects of risk allocation and of re-characterisation of transactions. These issues, whichconstitute the core of BEPS concerns in the área of transfer pricing will, therefore, be addressed inan integrated manner to provide effective, coherent and consistent solutions. This will involveconsidering both the application of the arm's length principie and of special measures in order toidentify effective responses to the BEPS concerns.

For further Information, picase read the Guidance on Transfer Pricing Aspects of Intangiblesavailable on line: www.oecd.org/tax/beps-2014-deliverables.htm

Action 13 - Re-examine transfer pricing documentation

31. What is country-by-country reporting?

Country-by-country reporting is a tool intended to allow tax administrations to perform high-leveltransfer pricing risk assessments, or to evalúate other BEPS-related risks. The country-by-countryreporting témplate will require multinational enterprises (MNEs) to provide annually for eachjurisdiction in which they do business, aggregate ínformation relating to the global allocation of theMNE's income and taxes paid together with certain indicators of the location of economic activitywithin the MNE group, as well as Ínformation about which enttties do business in a particularjurisdiction and the business activities each entity engages in.

32. What specífic ínformation will be Included in the country-by-country report?

The country-by-country reporting témplate requires MNEs to report annuaMy and for each taxjurisdiction in which they do business the amount of revenue, profit before income tax, and incometax paid and accrued. It also requires MNEs to report their total employment, capital, retainedearníngs and tangible assets ¡n each tax jurisdiction. Finally, the report atso requires a tisting of allentitíes within the doing business in a particular tax jurisdiction, as well as the nature of the mainbusiness activities carried out by each entity.

10

33. How will the information be used?

Taken together, the three documents (the country-by-country report, TP master file and TP local file)will require taxpayers to articúlate consistent transfer pricing posittons, and will provide taxadministrations with useful information to assess transfer pricing risks, make determmations aboutwhere audit resources can most effectively be deployed, and, ¡n the event audits are called for,commence and target audit enquiñes. This information will make it easier for tax administrations toidentify whether companies have engaged ¡n transfer pricing and other practices that have theeffect of artificially shifting substantial amounts of income into tax-advantaged envtronments.

34. Will country-by-country report information be made public?

The information must be provided to the relevant governments; to protect the confidentiality ofpotentially sensitive information, it will not be made publically available. This is consistent with thetreatment of most other taxpayer information.

35. When will this transfer pricing documentaron requirement enter into forcé?

Effective implementation of the new reporting standards and reporting rules will be essential.Additional work will be undertaken over the next several months to identify the most appropriatemeans of filing the required ¡nformation with and disseminating it to tax administrations. In thatwork, due regard will be given to considerations related to protection of the confidenttality of theinformation required by the reporting standards, the need for making the information available on atimely basis to all relevant countries, and other relevant factors. The country-by country reportingwill not be implemented until these details are worked out.

For further information, please read the Guidance on Transfer Pricing Documentation and Country-by-Country Reporting available on line: www.oecd.org/tax/beps-2014-deliyerables.htm

Action 15 - Develop a multilateral instrument

36. What ¡s the goal of a multilateral instrument?

In the context of the BEPS Project, the goal of a multilateral instrument is to expedite and streamlinethe imptementation of the measures developed to address BEPS, in particular by modifying bilateraltax treaties. Developing such a mechanism is necessary not only to tackle BEPS, but also to ensurethe sustainability of the consensúa! framework to elimínate double taxation.

37. Is it possible to amend the network of bilateral treaties via a multilateral instrument?

Yes, it is. Although there is no exact precedent in the ¡nternational tax field, there are severalprecedents in various other áreas of public ¡nternationat law where bilateral treaties have beenmodified via a multilateral instrument.

38. Would it be possible to use a multilateral instrument to implement other recommendations of theBEPS Project?

Yes, a multilateral instrument could in principie also be used to express commitments to implementcertain domestic law measures or provide the basis for safe exchanges of country-by-countryreporting témplate.

11

39. What ís the tirneline? Will an "International conference be called upon to develop the multilateralinstrument?

Drawing on the analysis of the tax and public international law issues related to the development ofsuch an instrument, ¡nterested countries may wish to develop a multilateral instrument, reflectingthe rapidly evolving nature of the global economy and the need to adapt quickly to this evolution. InJanuary 2015, OECD and G20 countries will consider a draft mándate for an international conferencefor the negotiation of a multilateral convention to streamline the ¡mplementation of the BEPS ActionPlan.

For further information, picase read the report Developing a Multilateral Instrument to ModifyBilateral Tax Treaties available on line: www.oecd.org/tax/beps-2014-deliverables.htm

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B. 2014 BEPS Deliverables and Developing Countries

40. How have developing countries been involved in the work?

Engagement with developing countries has been and will continué to be extensive. Accomplishingthe actions set forth in the BEPS Action Plan requires an effective and comprehensive process thatinvolves all relevant stakeholders, inctuding both developed and developing countries. Developingcountries have therefore been consulted extensivety through a combination of regional and globalhigh-level policy dialogues. Over 80 developing countries and other non-OECD/non-G20 economieshave been consulted through four in-depth regional consultations and five thematic global fora,attended by more than 110 jurisdictions and a number of representatives from civil society and thebusiness community.

41. How has the input from developing countries been used?

The input received from developing countries has been fed into the technical groups carrying out thework on BEPS. Further, ¡t has informed the development of a dedícated two-part report prepared bythe OECD under a mándate from the G20 Development Working Group, addressing the specificchallenges and priorities of low-income countries faced with BEPS issues. (Available on line atwww.oecd.Qrg/tax/tax-global/part-1-of-report^^countries.pdf).

42. What are the BEPS priorities for developing countries?

In addition, some Ítems of the BEPS Action Plan have been identified as of higher and moreimmediate priority by developing countries. These include limiting base erosión via ¡nterestdeductíons and other financial payments {Action 4), preventing tax treaty abuse and the artificialavoidance of PE status (Actions 6 and 7}, transfer pricing, in particular base eroding payments(Actions 8, 9 and 10), and transfer pricing documentation and country-by-country reporting (Action13). The lack of transfer pricing comparables and the granting of wasteful tax incentives have alsobeen identified as áreas of particular concern. These issues have not been specifically included in theBEPS Project but are the subject of ongoing work, particularly through the Task Forcé on Tax andDevelopment (see for example. Principies to Enhance the Transparency and Governance of TaxIncentives for Developing Countries at www.oecd.orR/ctp/tax-global/transparencv-and-governance-principles.pdf). Political support and capacity building have been identified as key challenges fordeveloping countries, particularly as the imptementation phase begins.

43. How will devetop'mg countries benefit from BEPS measures?

BEPS ís of major significance for developing countries due to their heavy reliance on corporateincome tax, particularly from multinational enterprises (MNEs). Therefore, the BEPS measures onceimplemented will benefit developing countries and provide them with tools to mobilise domesticreso urces.

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C. Planned next steps

44. What are the next steps?

Work on the reports to be delivered in 2015 has already started, and this work will continué at a fastpace to ensure the rapid development of concrete measures that countries can use to end doublenon-taxation and the artificial shifting of profits. In parallel, work will continué to address remainingtechnical issues with the measures in the 2014 reports, and to ensure that implementation andpractica! guidance can be developed with respect to all measures.

45. Will the engagement with developing countries continué?

Yes, the engagement will continué and will actually be strengthened and institutionaltsed to ensurethat developing countries that are willing to particípate in the meetings where BEPS issues arediscussed can do so and that the development of the measures and of the related imptementationguidance takes into account thetr priorities and specificities.

46. What are the 2015 deliverables?

The 2015 deliverables relate to strengthening CFC rules (Action 3), limiting base erosión via ¡nterestdeducttons and other financia! payments {Action 4), countering harmful tax practices moreeffectively, taking into account transparency and substance (Action 5), preventing the artificialavoidance of PE status (Action 7), assuring that transfer pricing outcomes are in line with valuécreation (Actions 8-10), establishing methodologies to collect and analyse data on BEPS and theactions to address it (Action 11), requiring taxpayers to disclose their aggresstve tax planningarrangements (Action 12), making dispute resolution mechanisms more effective (Action 14), anddeveloping a multilateral instrument (Action 15). Work on the 2015 deliverables has already begunand it ¡s expected to be completed on time. In Une with the commitment of all OECD members andG20 countries, an overall package taking into account the need for a comprehensive approach to theBEPS Project will be delivered by the end of 2015.

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D. Background on BEPS

47. What is BEPS?

Base erosión and profit shifting (BEPS) refers to tax planning strategies that exploit gaps andmismatches ¡n tax rules to make profits 'dísappear' for tax purposes or to shift profits to locationswhere there ¡s üttle or no real activity but the taxes are low, resulting in little or no overall corporatetax being paid.

48. Are BEPS strategies ¡Ilegal?

Although some schemes used are ¡Ilegal, most are not. Largely they just take advantage of currentrules that are still grounded in a bricks and mortar economic environment rather than today'senvironment of global players which ¡s characterised by the ¡ncreasing importance of intangibles andrisk management.

49. What causes BEPS?

Corporate tax is levied at a domestic level. When activities cross border, the interaction of domestictax systems means that an Ítem of income can be taxed by more than one jurisdiction, thus resultingin double taxation. The ¡nteraction can also leave gaps, which resutt in income not being taxedanywhere. BEPS strategies take advantage of these gaps between tax systems in order to achievedoubte non-taxation.

50. Why should we be worried about BEPS if it is legal?

First, because it distorts competition: businesses that opérate cross-border may profit from BEPSopportunities, giving them a competitive advantage over enterprises that opérate at the domesticleve!. Second, it may lead to inefficient allocation of resources by distorting investment decisionstowards activities that have lower pre-tax rates of return, but htgher after-tax returns. Finally, it isan issue of fairness: when taxpayers (tncluding ordinary individuáis) see multinational corporatíonslegally avoiding income tax, ¡t undermines voluntary compliance by all taxpayers.

51. Why worry about BEPS now? Is public outcry about the tax affairs of corporate giants the drivingforcé behind the OECD's work on BEPS?

The OECD has been providing solutions to tackle aggressive tax planning for years. The debate overBEPS has now reached the highest political levéis ¡n many OECD and non-OECD countries. The OECDdoes not see BEPS as a problem created by one or more specific companies. Apart from some casesof egregious abuses, the ¡ssue lies with the tax rules themselves. Business cannot be fautted forusing the rules that governments have put in place. It is therefore governments' responsibility torevise the rules or introduce new rules.

52. How much revenue is lost because of BEPS?

There is widespread and abundant evidence of the use of base erosión and profit shifting strategiesto achieve double non-taxation. Work under Action 11 of the BEPS Action Plan, to be finalised in2015, will help us better understand the total impact of BEPS on tax revenues and other aspects ofthe economy, and wilt also help us monitor the impact of the measures implemented in response.

53. What is the OECD's role in addressing BEPS?

Many BEPS strategies take advantage of the interaction between the tax rules of different countries,which means that unilateral action by individual countries will not fully address the problem. Inaddition, unilateral and uncoordinated actions by governments responding in isolatton could result¡n double - and possibly múltiple - taxation for business. This would have a negative impact on

15

¡nvestment, growth and employment globally. There is therefore a need to provide aninternattonally coordinated approach which will facilítate and reinforce domestic actions to protecttax bases and provide comprehensive international solutíons to respond to the issue. The BEPSAction Plan provides a consensus-based plan to address these issues and is part of the OECD'songoing efforts to ensure that the gfobal tax architecture is equitable and fair.

54. What does the BEPS Action Plan say?

It sets forth 15 actions to address BEPS in a comprehensive and coordinated way. These actions willresult in fundamental changes to the international tax standards and are based on three coreprincipies: coherence, substance, and transparency. The Action Plan also calts for further work toaddress the challenges posed by the digital economy. Looking toward innovative approaches todeliver change quickly, the Action Plan calis for a multilateral instrument that countries can use toimplement the measures developed in the course of the work. While the OECD steps up its efforts toaddress double non-taxation, it will also continué work to elimínate double taxation, includingthrough increased efficiency of mutual agreement procedures and arbitration provisions.

55. What actions are being carried out in the context of BEPS?

Domestic tax systems are coherent - tax deductible payments by one person results in incomeinclusions by the recipient. We need international coherence in corporate income taxation tocomplement the standards that prevent double taxation with a new set of standards designed toavoid double non-taxation. Four actions in the BEPS Action Plan (Actions 2, 3, 4, and 5} focus onestablishing this coherence.

Current rules work well in many cases, but must be modified to prevent ¡nstances of BEPS. Theinvolvement of third countries in the bilateral framework established by treaty partners puts a strainon the existing rules, in particular when done via shell companies that have little or no economicsubstance: e.g. office space, tangible assets and employees. In the área of transfer pricing, ratherthan replacing the current system, the best course is to fix the flaws in it, in particular with respectto returns related to over-capitalisation, riskand intangible assets. Nevertheless, special rules, eitherwithin or beyond the arm's length principie, may be required with respect to these flaws. Fiveactions in the BEPS Action Plan focus on aligning taxing rights with substance (Actions 6, 7, 8, 9, and10).

Because preventing BEPS requires greater transparency at many levéis, the Action Plan calis for:improved data collection and analysis regarding the ímpact of BEPS; taxpayers' disclosure abouttheir tax planning strategies; and less burdensome and more targeted transfer pricingdocumentation. Four actions in the BEPS Action Plan focus on improving transparency (actions 11,12, 13, and 14).

56. Can BEPS be tackled without replacing the arm's length principie with formulary apportionment?

The current transfer pricing rules do not always properly address the way modern businessesopérate in a globalised environment, and taxpayers have thus been able to use/misuse the rules toartificially shift profits. In particular, the arm's length principie faces challenges in addressingtransfers of intangibles, risks, and capital, and other high-risk transactions. The Action plan ¡ncludesthree major actions to address these cases, which may include special measures either within orbeyond the arm's length principie. The Action Plan has been developed to fix the current systemquickly and efficientiy, without preconceptions regarding the precise nature of the changes that maybe required to address these critical transfer pricing issues. However, adoption of alternativetransfer pricing methods like formulary apportionment would require development of a consensuson a number of key issues (which countries do not believe to be attainable in the short or médiumterm) and could also raise systemic problems which could result in even more damaging problems

16

for countries' revenues. Accordingly, ¡t is betieved that it wilí be most productive to focus onaddressing specific issues arising under the current arm's length system at the present time.

57. How wíll the Actíons be implemented?

The BEPS Action Plan calis for the development of tools that countries can use to shape fair,effective and efficient tax systems. Because BEPS strategies often rely on the interaction ofcountries' different systems, these tools will have to address the gaps and frictions that arise fromthe interaction of these systems. Some actions, for example work on the OECD Transfer PricingGuideltnes and the Commentary to the OECD Model Tax Convention, will result in changes that aredirectly effective. Others will be implemented by countries through thetr domestic law, bilateraltreaties, or a multilateral ¡nstrument.

58. How long will this take?

Addressing BEPS is critical for most countries and must be done ¡n a timely manner so that concreteactions can be delivered quickly before the existing consensus-based framework unravels. At thesame time, governments need time to complete the necessary technicat work and achievewidespread consensus. Against this background, it is expected that the Action Plan will largely becompleted within 2 years of its adoption. tndeed, the first set of measures and reports was releasedin September 2014, just 12 months after the launch of the BEPS project. Work on the reports to bedelivered in 2015 has already started, and this work will continué at a fast pace to ensure the rapiddevelopment of concrete measures that countries can use to end double non-taxation and theartificial shifttng of profits.

59. What is the role of the G20 in this project?

Since ¡ts launch by the OECD, the work on BEPS received strong and consistent support by the G20and it is a key Ítem on the Finance Ministers' and Leaders' agendas. Furthermore, all G20 countrieshave participated as equal partners in the development of the work. Their continued participationand endorsement at the highest levéis of government have been critical to guarantee a level playingfield and prevent inconsistent standards.

The delivery of the 2014 BEPS outputs is concrete evidence of how OECD and G20 members workingtogether can achieve consensus on important reforms with a worldwide ¡mpact. Non-OECD G20countries are Associates in the BEPS Project and particípate on an equal footing in the decisiónmaking process, at the level of both the OECD Commtttee on Fiscal Affairs and of its subsidiarybodies carrying out the technical work. In addition, other countries and stakeholders have engagedin regular and fruitful dialogues throughout this process.

60. Is the BEPS Action Plan meant to stop tax competition?

Taxation is at the core of countries' sovereignty, and each country is free to set up its corporate taxsystem as ¡t chooses, including by charging the rate it chooses. The work is not aimed at restrictingthe sovereignty of countries over their own taxes; instead, it is aimed at restoring and strengtheningsovereign taxing rights by ensuring that countries can protect their tax bases from the economicactivities that genérate it. It does so by addressing regimes that apply to mobile activities and thatunfairly erode the tax bases of other countries, potentially distorting the location of capital andservices.

61. What is the risk of not addressing harmful tax practices?

The dangers of not addressing harmful tax practices can be felt both by governments and business.Firstly, harmful tax competition can introduce distortions and an unlevel playing field betweenbusinesses operatíng at domestic level and those that opérate globally and have access to

17

preferential regimes. Secondly, countries have long recognised that a "race to the bottom" wouldultimately drive applicable tax rates on certain sources of income to zero for all countries, whetheror not this is the tax policy a country wishes to pursue.

62. How will the BEPS Action Plan affect "tax havens"?

The BEPS Action Plan aims to end the use of shell companies used to stash profits offshore or undulyclaim tax treaty protection and neutralise atl schemes that artificially shift profits offshore. Thoughthe BEPS Action Plan is not about dictating whether countries should have a specific corporateincome tax rate, it will have an impact on regimes that seek to attract foreign investors withoutrequiring any economic substance.

63. Is this effectively a tax increase on multinationals?

The BEPS project is not about increasing corporate taxes. Non- or low-taxation is not itself theconcern, but it becomes so when it is achieved through practices that artificially sepárate taxableincome from the activities that genérate it. These strategies may increase tax disputes as countriesfight agaínst tax strategies that defy common sense. Implementation of the recommendationscoming out of the BEPS project will reduce those disputes, giving business greater certainty, andreinforcing the fairness and consistency of international tax system.

64. How are businesses and civil society involved tn the work?

During the course of the work so far, stakeholders have been consulted at length. Discussion draftsreleased during the course of the work so far have generated more than 3 500 pages of comments,and have attracted a large number of participants at 5 public consultations. The OECD's publicwebcasts of these consultations and our updates on the project have attracted more than 10 000viewers. This transparent and inclusive consultation process will continué throughout the course ofthe work.

65. Will the BEPS Action Plan put an end to offshore tax evasión?

The work on BEPS focusses largely on legal tax planning techniques rather than offshore tax evasión,which is ¡Ilegal. However, other work being carried out by the OECD and the OECD Global Forum onTransparency and the Exchange of Information is focused on combatting offshore tax evasión. Moreinformation about this work can be found on line at www.oecd.org/tax/exchanee-of-tax-information/.

18

» OECDBETTER POLICIES FOR BETTER UVES

Interim EconomicAssessment

15 September 2014

Modérate global growth ¡s set to continué, butweak demand in the euro área remains a concern

The global economy is contínuing to expand at a modérate and uneven pace. The tepíd rote of growthmeans that a substantial degree of labour market slack remains, especially in the euro área, and worldtrade growth remains sluggish. Global growth should be somewhat more vigorous in the second half of2014 and into 2015 given continued policy support, favourable financial conditions and growingconfidence, alongside rising employment.

There is a growing degree of divergence between the majar economies. The recovery in the United Statesis solid/ and growth is around trend in Jopan and China and strengthening in India after the recent weakpatch. By contrast, growth in the euro área looks set to remain subdued in the near term and Brazil isexpected to make only a slow recovery from recession.

OECD Interim Economic Forecasts

2013 20142.10.80.91.50.4-0.43.12.3

20153.11.11.11.51.00.12.82.7

Note: GDP at market valué adjusted for working days. For Germany and India, this measure may show differentgrowth rates from national headline measures.

The fact that majar economies' positions in the economic 'cycle are becoming less synchronised is reflectedin diverging macroeconomic policy requirements. Nonetheless, it remains true that monetary conditionsought to remain supportive in all the major advanced economies, while most countries need to makefurther progress on fiscal consolidation to ensure that debt burdens remain sustainable. To raise growthsustainably, some countries are grasping structural reform opportunities and must ensure effectiveimplementation, while others need to be more ambitious in measures to boost competition andemployment to achieve stronger and more inclusive growth.

Modérate and bumpy global growth has been reflected in weak trade growth and a slow paceof improvement ín labour markets

• Growth among the major economies was uneven in the first half of 2014, largely reflecting a number ofone-off factors including unusual weather patterns ¡n several countries and the strong effect ofconsumption tax hike ¡n Japan. The world economy has been growing at a rate similar to that of thelast three years, but well below the pre-crisis pace and slower than during the initial rebound from theglobal crisis.

World GDPPercentoge change, seasonolly adjusted annualised rate

4

3

2 ~

1 -

O

4

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- 2

O

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Source: OECD National Accounts datábase.

• The continued modérate pace of global growth, with subdued growth of trade-intensive tnvestment, isreflected in the persistence of sub-par world trade growth.

Global trade in goods and sen/icesVolume, year-on-yeor percentage change

Pre-cnsis average(1990-2007)

Source: OECD National Accounts datábase.

The recovery in the labour market in the OECD región as a whole remains at an early stage, although inthe North America and the United Kingdom employment growth is now solid and unemployment isfalling steadily, while in Japan unemployment is back to pre-crisis levéis and vacancies per job-seekerhave surpassed the peaks reached in 2007. By contrast, unemployment in the euro área has only justbegun to retrace from its post-crisis peaks. Employment rates across the advanced economies have

rer cent o/ worKing age popuiouon annuotisea percemage cnange, u.¿ ¿UU9 - Ql ¿Ul

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54

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Real wageLabour producti

UnitedStates

Japan Euro área

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l.O

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Source: OECD May 2014 Economic Outlook datábase. Note: Real wage ¡s empioyee compensation divided by totalhours worked in the economy, deflated by the CPI. Labourproductivity is real GDP divided by hours worked.Source: OECD calculations based on quarterly national accounts.

Continued slow growth in the euro área is the most worrying feature of the projections

• In most of the major economies a modérate expansión looks set to continué, even if growth prospectsare in some cases less positive than projected in the May 2014 Economic Outlook:

o In the United States, the modérate underlying expansión remains broadly on track, after theweather-affected first quarter of 2014 and sharp second quarter rebound. Employment gainsare set to continué, with business investment likely to strengthen.

o Growth has remained solid so far thts year in the United Kíngdom and Canadá, and isexpected to continué at a healthy pace through 2015.

o In Japan, the sales tax increase in April resulted in volatile demand in the first half of 2014, butbeginning in the second half of the year the underlying recovery ¡s expected to reassert itself,reflecting ¡mproved confidence, growing employment and a reversal of the decline in realwages.

o China has so far managed to achieve an orderly growth slowdown to more sustainable rates.Growth rebounded in the second quarter after weakness early in the year, helped by a rangeof mini-stimulus measures, supported by significant structural reform measures.

o In India, confidence and spending have ¡mproved markedly during 2014 as a result of progressto control inflation and the perception that the new government will reinvigorate growth-oriented reform. Growth is expected to pick up in both 2014 and 2015.

• In contrast to these economies, the Interim Forecasts indícate a significantly more negative appraisal intwo cases:

o The recovery in the euro área has remained disappointing, notably in the largest countries:Germany, France and Italy. Confidence is again weakening, and the anaemic state of demandis reflected in the decline ¡n inflation, which is near zero in the zone as a whole and negative inseveral countries. While the resumption in growth in some periphery economies ¡sencouraging, a number of these countries still face significant structural and fiscal challenges,together with a legacy of high debt.

o Brazil fell into recession in the first half of 2014. Investment has been particularly weak,sapped by uncertainty about the direction of policy after the coming elections and the needfor monetary policy to restrain above-target ¡nflation. A modérate rebound can be expectedas these factors unwind, but growth is projected to remain below potential in 2015.

The possibility that euro área inflation will stay low and exacérbate weak demand is a key rísk

• Inflation has been failing steadily in the euro área for nearly three years. As demand strengthens,inflation is expected to turn back up and gradually converge on the EBC's target range. But thesuccession of downward surprises has increased the risk that inflation remains far below the ECB'starget for a more extended period or declines further.

• Excessively low ¡nflation makes it more difficult to achieve the relative price adjustments that remainnecessary to rebalance euro área demand without having to endure a prolonged period of slow growthand high unemployment. Inflation near zero also clearly raises the risk of slipping into deflation, whichcould perpetúate stagnation and aggravate debt burdens.

• Some reassurance on the risk of excessively low inflation has been provided by the fací that, untilrecently, long-term inflation expectations appeared well-anchored around the ECB's definition of pricestability. As actual inflation has continued to fail, however, implied expectations from swap rates overthe 6-10 year horizon have drifted downward somewhat. Moreover, the experience of Japan ¡n the1990s ¡s a reminder that such expectations measures can be poor predictors of the actual future rateof inflation: 6-10 year consensus expectations in Japan were similarly near 2% in the early 1990s, failingto foresee the descent into deflation.

Consumer price inflation12-month percentage change of harmonised Índex ofconsumer pnces

Source: Eurostat.

Inflation expectations in the euro áreaFrom inflation swops; 10-day moving averoge, per cent

1 -

O

- 2

- 1

NTT?

Source: Datastream.

Important risks hang over the recovery, despite financial market bullishness

• Even apart from the possibility that entrenched low inflation feeds further negative growth surprises inthe euro área, there are many significant risks to the near-term outlook. Notably, geopolitícal riskshave grown in recent months, with an intensification of conflicts in Ukraine and the Middie East and¡ncreasing uncertainty about the outcome of the referendum on Scottish independence. Also, manyemerging economies remain vulnerable to financial market shocks given the build-up of debt,particularly corporate debt, in recent years. The anticipated tightening of US monetary policy couldlead to shifts in international financial flows and sharp exchange rate movements that would bedisruptive, especially for some emerging economies. Of course, not all risks are on the downside. Forexample, successful ¡mplementation of the comprehensive assessment of banks ¡n the euro área couldbe associated with faster-than-expected improvements in credit flows.

• The bullishness of financial markets appears at odds with the intensification of several significant risks.A number of equity markets are reaching record highs, sovereign bond yields ¡n several countries arenear all-time lows and implied share price volatility ¡n the United States and Europe is around pre-crisislevéis. This highlights the possibility that risk is being mispriced and the attendant dangers of a suddencorrection.

Share pricesíndices, Jan 2005 = 100

Implied share price volatilityPer cent

250 i

2OO -

150

1OO

o

•Developed markets

•Emerging marketsT 1 1 r

oí-Note: Series shown are the MSCI World and EmergingMarkets Índices. The MSCI World Index covers 23 developed Source: Datastream.markets and the MSCI Emerging Markets Index 23 emergingmarkets.Source: Datastream.

The global recovery needs continued supportfor demand, but macroeconomic policy needs areincreasingly diverse across countries

• Increasingly varied cyclical positions means that the necessary macro policy settings are diverging. Theeuro área needs more vigorous monetary stimulus, whereas the United States and the United Kingdomare moving to the end of their unconventional monetary easing. Japan still needs quantitative easing tosecure a lasting break with deflation. Policy settings ¡n China are consistent with achieving an orderlygrowth slowdown, with ebbing inflation pressures provtding ampie room for stimulus if needed. Bycontrast, inflation remains above target in Brazil and India and monetary policy will need to remainrestrictive.

Other major central banks have eased more aggresslvely than the ECBCentral bank assets as per cent of GDP

J=1?

-¿S

Source: Datastream.

Government debt burdens remain heavy in most major advanced economies but considerableprogress has been made in fiscal consolidation. Given the weakness of demand, the flexibility withinthe EL) fiscal rules should be used to support growth. In Japan, by contrast, the necessaryconsolidation is only beginning and the challenge to ensure debt sustainability is substantially greater.The planned second round of consumption tax increases in 2015 should be implemented, supported ifnecessary by other measures, particularly further monetary expansión, to manage demand. In theUnited States, consolidation needs are less pressing, but medium-term consolidation plans are stillneeded to keep public debt on a sustainable path.

Among emerging economies, China's broadly neutral fiscal stance is appropriate. The main challengepertains to local government debt. Recently announced policy changes go ¡n the right direction:enhanced transparency, lower fiscal risk stemming from sub-national borrowing through localgovernment financíng vehicles and reduced pro-cyclicality of the budget.

In India and Brazil, durable improvement in fiscal situations is still needed. In India, the quality ofconsolidation should be ¡mproved, with a reduction in subsidies and a shift in expenditure to socialand physical infrastructure. Redesigning the fiscal rule in Brazil to take account of the business cycle,for example by adopting an expenditure rule, would make a credible commitment to the necessaryimprovement in the primary balance as the economy recovers.

Structural reforms are a key part of comprehensive strategies for strong and inclusive growth

• The global recovery from the crisis has been inadequate ¡n several ways. Economic slack has persisted,potential growth has slowed, and inequality has risen. Meanwhile, external imbalances and threats tofinancial stability have remained. To address these various, often inter-related, problems, structuralpolicies have a key role to play. In the euro área, for example, structural weaknesses in the bankingsystem have hindered the effectiveness of easing monetary policy as a means to support demand. Thecompletion of the banking unión and a credible comprehensive assessment of banks will help to repaírthe transmission mechanism of monetary policy, making stimulus measures more effective. In theUnited States, stepped-up infrastructure investment would boost potential growth, while tax andlabour market reforms could help to address the rise in inequality.

• Strengthening competition would help stimulate innovation and improve the allocation of resources inmany economies. To that end, lower barriers to trade and reduced administrative burdens on firmswould often be important for emerging economies, while liberalisation of services is a common priorityamong advanced economies.

• Tax simplification in developing countries like India and Brazil would remove a brake on investment.Employment could be boosted in countries with large tax wedges on labour, like France, by reducingemployer social security contributions. In order to prevent the increased incidence of long-termunemployment from being reflected in a lasting rise in the structural unemployment rate, activationpolicies ¡n a range of developed economies will need to be strengthened. Removing barriers to femaleparticipation in education and the labour forcé has considerable potential to boost output and well-beíng, especially in emerging economies.

• The continued failure of the global economy to genérate strong, balanced and inclusive growthunderlines the urgency of ambitious reform efforts.

The OECD Interím Economic Assessment

The OECD Interim Economic Assessment is a partial update each September and March of the OECD'stwice-yearly Economic Outlook published in November and May/June. Revised forecasts for annual GDPgrowth are provided for the G7 economies and BrazM, China and India.

The revised forecasts are based on a simplified versión of the process used to prepare the EconomicOutlook, based on models and judgement. Near-term developments are assessed using the OECD's short-term indicator models.

Revisions in growth projections vis-á-vis the May 2014 Economic Outlook

GDP growthPer cent

May 2014EconomicOutlook

SeptemberInterim

Forecasts

May 2014

EconomíaOutlook

SeptemberInterim

Forecasts

A l'occasion du séminaire parlementaire International de l'OCDE

Monsieur Claude BARTOLONEPrésident de I 'Assemblée nationale

vous prie de bien vouloir assister á la reception qu 'U offrira

le mercredi 1er octubre 2014 á 19 h 30dans les salons de I 'Hotel de Lassay

128, rué de rUniversité RSVP75007 París [email protected]

AsambleaParlamentaría del

Consejo de EuropaEstrasburgo, Francia

1 de octubre de 2014

j&" Council of EuropeConseil de I'Europe

VISITEUR_APabloLORENZINI BASSOCHILl

OCDEDu 30/09/2014 au 01/10/2014

Parliamentary AssemblyAssemblée parlementaire

COUNCILOF EUROPE

CONSEIL DE L'EUROPE

AS/Pol/lnf(2014)19rev23 September 2014Apdocinf19rev_14 (English only)

REVISED DRAFT PROGRAMMEIN RELATION TO THE ENLARGED DEBATE ON THE ACTIVITIES OF THE

ORGANISATION FOR ECONOMIC COOPERATION AND DEVELOPMENT (OECD)

for the attention of

DELEGATIONS OF THE NATIONAL PARLIAMENTS OF OECD MEMBER STATES WHICHARE NOT MEMBERS OF THE COUNCIL OF EUROPE,

DELEGATION FROM THE EUROPEAN PARLIAMENT,

and THE OECD

Tuesdav. 30 September 2014

9.00am-10.00am

8.30 pm

Meeting of the Enlarged Committee on Political Affairs and Democracy(Raíais de l'Europe, 2nd floor, room 9)

Exchange of views with the delegations of the national Parliaments of OECDmember States which are not members of the Council of Europe

Dinner (by invitation) hosted by Ms Theodora Bakoyannis, Chairperson of theCommittee on Political Affairs and Democracy, at the restauran!"La Maison Kammerzell", 16 Place de la Cathédrale, Strasbourg

Wednesdav. 1" October 2014

10.00am

12.00 am-1.00 pm

1.00 pm

2.00-4.00 pm

Enlarged Debate on The Activities of the Organisation for Economic Co-operation and Development (OECD) in 2013-20141

(Palais de l'Europe, Hemicycle)

See sepárate draft agenda of the 4"1 part of the 2014 Ordinary Session(29 September - 3 October 2014)

Members who wish to speak during the Enlarged Debate in the hemicycle on 1stOctober should send their ñames to the Parliamentary Assembly Table Office (byemail: [email protected] or by fax n° 33 3 88 41 27 33) or, during the session,should go to Office 1083 as early as possible and at the latest at 7pm on Tuesday30 September 2014

Bilateral meetings between Mr Ángel Gurría, Secretary General of the OECD, andthe delegations of the national Parliaments of OECD member States which are notmembers of the Council of Europe - (Palais de l'Europe, ground floor, room 14)

Officíal lunch (by invitation} hosted by Ms Anne Brasseur, Presiden! of theParliamentary Assembly of the Council of Europe, at the Blue Restaurant of theCouncil of Europe (Palais de l'Europe, ground floor)

Bilateral meetings (continued)

1 Debate according to the Rules of Procedure for enlarged debates on the activities of the OECD


COUNCIL OF EUROPE

CONSEILDE LEUROPE

Doc. 13587 prov 119 September 2014

4th part of the 2014 Ordinary Session (29 September3 October2014)

Draft agenda1

1. Drawn up by the Bureau of the Assembly on 2 September 2014.Updated, under the authority of the Secretary General of the Assembly, to reflect modifications to be proposed to the

Bureau of the Assembly before the opening of the part-session {modifications are ¡ndicated in grey).

Legends and abbreviations

List of committeesBur; Bureau of the AssemblyPer: Standing CommitteePol: Committee on Political Affairs and DemocracyJur: Committee on Legal Affairs and Human RightsSoc: Committee on Social Affairs, Health and Sustainable DevelopmentMig: Committee on Migration, Refugees and Displaced PersonsCult: Committee on Culture, Science, Education and MediaEga: Committee on Equality and Non-DiscriminationMon: Committee on the Honouring of Obligations and Commitments by Member States of the Council ofEurope (Monitoring Committee)Pro: Committee on Rules of Procedure, Immunities and Institutional Affairs

List of political groupsSOC: Socialist GroupEPP/CD: Group of the European People's PartyEDG: European Democrat GroupALDE: Alliance of Liberáis and Democrats for EuropeUEL: Group of the Unified European LeftNR: Represéntate ves not belonging to a political group

SymbolsO Presentaron, statementG Deadlíne for tabling documentsfP Lists {speakers, questions)£ Votes

Meetings outside the Chamber

Bureau of the AssemblyMonday: 08:00-09:30Friday: 08:30-10:00

CommitteesMonday: 14:00-15:00Tuesday: 08:30-10:00Tuesday: 14:00-15:30Wednesday: 14:00-15:30Thursday: 08:30-10:00Thursday: 14:00-15:30

Political groupsMonday: 09:30-11:00Monday: 17:00-19:00Wednesday: 08:30-10:00

Monday 29 September 2014

Sitting No. 28 (11:30-13:00)

1. Opening of the part-session1.1. Statement by the Presiden!

1.2. Examination of credentials

1.4. Changos in the membership of committees

1.6. Adoption of the agenda

2. Debate2.1. Progress report of the Bureau and the Standing Committee

O Presentation by:o Mr Tiny KOX (Netherlands, UEL), Rapporteur AS/Bur (Doc )

2.2. Observation of the presidential election in Turkey (10 August 2014)

O Presentation by:o Ms Meritxell MATEU Pl (Andorra, ALOE), Rapporteur AS/Bur (Doc. )

JP List of speakers

3. Prize Award Ceremony (12:30-13:00)

3.1. Vaclav Havel Human Rights Prize2

Sitting No. 29 (15:00-17:00)

4. Debate4.1. Progress report of the Bureau and the Standing Committee (continued)

4.2. Observation of the presidential election in Turkey (10 August 2014) (continued)

P List of speakersó [possibty] Vote

List of speakers

2. See programme published separately (AS/lnf (2014) . .).

Tuesday 30 September 2014

Sitting No. 30 (10:00-13:00)

6. Debate6.1. Counteractíon to manifestations of neo-Nazism

D Presentation by:o Ms Marietta de POURBAIX-LUNDIN (Sweden, EPP/CD), Rapporteur AS/Pol (Doc. 13593)o Ms Olga KAZAKOVA (Russian Federation, NR), Rapporteur for opinión AS/Ega (Doc. )

H List of speakers© Amendments (deadline for tabling: Monday 29 September, 16:00)/?• Votes on a draft resolution and a draft recommendation (Doc. 13593)

Sitting No. 31 (15:30-20:00)

7. Debate7.1. Women's rights and prospects for Euro-Mediterranean co-operation

O Presentation by:o Ms Fatiha SAÍDI (Belgium, SOC), Rapporteur AS/Ega (Doc. 13596)

JS List of speakers© Amendments (deadline for tabling: Monday 29 September, 16:00)Ó Votes on a draft resolution and a draft recommendation (Doc. 13596)

8. Joint debate8.1. Good governance and enhanced quality in education

O Presentation by:o Mr Paolo CORSINI (Italy, SOC), Rapporteur AS/Cult (Doc 13585)

8.2. Raising the status of vocational education and trainíngD Presentation by:

o Mr Piotr WACH (Poland, EPP/CD), Rapporteur AS/Cult (Doc. 13590)

ü List of speakers© Amendments (deadline for tabling: Monday 29 September, 16:00)A Votes on a draft resolution and a draft recommendation (Doc. 13585)A Vote on a draft resolution (Doc. 13590)

Wednesday 1 October 2014

Sitting No. 32 (10:00-13:00)

9. Debate9.1. The activities of the Organisation for Economic Co-operation and Development (OECD) in

2013-2014O Statement by:

o Mr Ángel GURRlA, Secretary General of the OECD

JS List of speakers

® List of speakers© Amendments (deadline for tabling: Tuesday 30 September, 10:30)ó Vote on a draft resolution (Doc. 13588)

Sitting No. 33 (15:30-20:00)

Ü List of speakers

12. Debate12.1. The progresa of the Assembiy's monitoring procedure (October 2013 - September 2014)

Q Presentaron by:o Mr Stefan SCHENNACH (Austria, SOC), Rapporteur AS/Mon (Doc. 13595)

ü List of speakers© Amendments (deadline for tabling: Tuesday 30 September, 16:00)A Vote on a draft resolution (Doc. 13595)

3. Subject to a decisión by the Assembly.

Thursday 2 October 2014

Sitting No. 34 (10:00-13:00)

13. [Possibly] Debate under urgent procedure4

\(12:00-13:00)

ü Questions© Written questions (deadline for tabling: Monday 22 September, 11:30)

Sitting No. 35 (15:30-20:00)

15. Debate15.1. The activities of the European Bank for Reconstruction and Development (EBRD) in 2013-

2014O Presentaron by:

o MrsCherylGILLAN {United Kingdom, EDG), Rapporteur AS/Pol (Doc. 13594)

D Statement by:o Sir Suma CHAKRABARTI, President of the EBRD

ÜD List of speakers© Amendments (deadline for tabling: Wednesday 1 October, 16:00)6 Vote on a draft resolution (Doc. 13594)

16. Debate16.1. The honouring of obligations and commitments by Albania

O Presentaron by:o Mr Grigore PETRENCO {Republic of Moldova, UEL), Co-Rapporteur AS/Mon (Doc.13586)o Mr Jonathan EVANS (United Kingdom. EDG), Co-Rapporteur AS/Mon (Doc. 13586)

ü List of speakers© Amendments {deadííne for tabling: Wednesday 1 October, 16:00)A Vote on a draft resolution (Doc. 13586)

4. Subject to a decisión by the Assembly.

Friday 3 October 2014

Sitting No. 36 (10:00-13:00)

17. Debate17.1. The alternativos to immigration detention of children

O Presentation by:o Ms Tinatin BOKUCHAVA (Georgia, EPP/CD), Rapporteur AS/Mig (Doc. 13597)

di List of speakers© Amendments (deadline fortabling: Thursday 2 October, 10:30)ñ Votes on a draft resolution and a draft recommendation (Doc. 13597)

18. Debate18.1. Towards optimum breast cáncer services across Europe

O Presentation by:o Ms Stella KYRIAKIDES (Cyprus. EPP/CD), Rapporteur AS/Soc (Doc. 13572)

jf List of speakers© Amendments (deadline for tabling: Thursday 2 October, 10:30)& Vote on a draft resolution (Doc. 13572)

19. Closure of the part-session

Report to the Parliamentary Assembly ofthe Council of Europe on the activities

THE ORGANISATION FOR ECONOMIC

CO-OPERATION AND DEVELOPMENT (2013-14).

» OECDBETTER POUCIES FOR SETTER LIVES

» OECiBETTER POUCIES FOR BETTER Ll

BACKGROUND

The Council of Europe's Parliamentary Assembly (PACE) reviews and debates the state ofthe worid economy and the work of the OECD annually. In the past, the OECD participatedin a year-long process by which the Committee on Political Affairs and Democracy - whichoversees the work of the OECD - identifíed a rapporteur, who after a fact-finding mission atOECD Headquarters, prepared a report on the activities of the Organisation. The processculminated in an exchange of views between the enlarged PACE Assembly and theSecretary-General of the OECD (SG) on October 1 of each year in Strasbourg.'

While the enlarged Assembly debates on the activities of the OECD continué to take place,starting this year and every other year the debate will be based on a report authored by theOECD Secretariat. Every second year, the report will be drafted by the Committee onPolitical Affairs and Democracy.

This year's exchange of views with the Secretary-General will be based on the report belowdrafted by the OECD Secretariat.

INTRODUCTION

1. The report that follows aims to inform the enlarged PACE Assembly on the activitiesof the OECD since Secretary-General Ángel Gurría participated in the annual exchange ofviews with PACE in October 2013.

2. The report includes OECD activities, including those identified in the StrategicOríentatíons of the Secretary-General issued in May 2014 setting out how the OECD willcontinué to support Member and Partner countries in addressing the four main legacies of theglobal financial crisis - low growth, high unemployment, declining trust and risinginequality.2

3. The report is not exhaustive of all OECD activities but aims to highlight the majorinitiatives that - based on the analysis of global trends, the definition of new strategicapproaches and the ¡dentif¡catión of drivers of growth - are being undertaken by theOrganisation to achieve a fairer, more equitable and sustainable world economy.

' The PACE Assembly is enlarged to include the delegations of national parliaments of the OECDmember States that are not members of the Council of Europe, as well as a delegation of the EuropeanParliament.2 The Strategic Orientations of the Secrelary-General were delivered to the Ministerial CouncilMeeting (MCM) held on 6-7 May, 2014.

I. THE GLOBAL OUTLOOK, SOCIAL AND FINANCIAL SITUATION

1.1 The Economic Outlook

4. The global economy is recove ring at a modérate and uneven pace according tothe OECD's September 2014 Interim Economic Outlook. Growth in the United States isstrong, while in Japan it is expected to pick up speed in the second half of 2014 and 2015.However, the recovery in the euro área remains fragüe and hesitant. Growth in majoremerging economíes will continué to strengthen and nourish global growth, although some,such as Brazil, will face sígnificant challenges to sustain solid growth rates. Trade andinvestment growth remain sluggish, but private-sector confidence is gradually improving inmost advanced economies. The downward pressure from fiscal policy ís also fallíng as thepace of fiscal consolidation cases.

5. Most OECD countries' GDP potential, however, remains below whaí it wouldhave been without the economic crisis, by as much as 6% for the euro área. Tbere arealso downside risks that could knock the recovery off course. Geopolitical risks haveincreased since the start of the year. While fínancial market conditions have been benign, arenewed deterioration in financia! conditions for emerging economies remains a possibiíityand could spill globaily. Persistently low inflation and high unemployment in the euro árearaises the risk of deflation and prolonged stagnation.

6. Monetary policy in advanced economies should remain accommodative in manycountries, especially in the euro área given the low inflation, and in Japan, where assetpurchases should be continued as planned. In the United States, asset purchases should beended and policy rates start to be raísed during 2015. In China, raonetary policy will need tobe eased if growth were to slow sharply.

7. Recent improvements in fiscal sustainability should be preserved but theincreased fiscal space allows some support for acíivity. Euro área countries have madesignificant progress in fiscal consolidation. The needed front-loaded consolidation hascontributed to weak demand but the recent improvement in lending conditions is larger thananticipated. Countries should use room wíthín the EU fiscal rules to maintain this policy in aflexible way, and best balance tax and spending ínstruments, particularly public investment,to boost Jobs and growth.

8. The crisis has left deep scars in the labour market, mainly in the form of higherunemployment and lower participation of the more vulnerable groups of society.Unemployment will remain wel) above its pre-crisis levéis in many OECD countries despite aprojected recovery, with average jobless rates in the OECD área decreasing slightly from7.4% in mid-2014 to 7.1% at the end of 2015.3 Almost 45 million people are still out of work,12 million more than just before the crisis. Globaily, an estimated 202 million people areunemployed, with many more in low-paid and precarious Jobs.

71 OECD Employment Outlook 2014.

9. Given these developments, structural measures to enhance growth should bestepped up and focused oo raising productivity and incomes, rather than just reducingcosts. Promoting demand should remain a key policy objective where the recovery has beenless robust, accompanied by reínforced measures to combat structural unemployment. Inrecent years, a number of euro área countries, notably those most affected by the crisis, havestepped up the pace of reforms, including by taking difficult but much needed steps to makeit easier for firms to hire new workers and improving regulation for competítion. Effectiveimplementation of these measures is now key.

10. Looking ahead, countries should promote job creation and boost productivity bydeploying active labour market policies, improving their skills and innovation policiesand further removing barriers to domestic and international competition, notably in theservices sector. Such policies wíll also help countries get the most out of global valué chains.At the ETJ leve!, progress towards a more complete Single Market needs to be accelerated,including improving cross-border regulatory cooperation and infrastructure in networkindustries and transpon. Government procurement could be opened up to greater foreigncompetition.

11. As economies and societies struggle to return to growth, they are also faced withmajor social and inequality concerns exacerbated by the crisis, as well as the challenges ofageing and the now urgent need to preserve the environment. Much more needs to be done tomake our economies more inclusive and our economic policies greener.

1.2 Social Developments and Social Policies

12. la line with the October 2013 recommendations by PACE, the OECD hascontinued to work on income inequality. Over the past three decades, the share of therichest 1% in total pre-tax income has increased in most OECD countries- The income of thetop 10% of the population is now 9.5 times that of the bottom 10%, up by more than 30% in25 years. Even in countries with more equal distribution, such as Germany, Norway andSweden, the income raüo of the richest 10% to that of the poorest is up from 5:1 in the 1980sto 6:1 today. The crisis has intensified these long term trends.

13. The youth have now replaced the elderly as the group experiencing the greatest risk ofincome poverty. While relative income poverty has remained broadly unchanged between2007 and 2011 in the OECD área, "anchored poverty" increased by nearly 2 percentagepoints during the same period, and by much more in the countries most affected by the crisis,such as Greece and Spain.4 In Greece, "anchored" poverty increased by almost 15 percentagepoints over the four years to 2011, with large increases (between 9 and 3 points) alsoexperienced in Ireland, Spain, Iceland, Hungary and México.

14. The 2014 edition of OECD Society ai a dance has found that income inequalityand social divisions can worsen and become entrenched unless governments act quickly

4 "Anchored poverty" provides an indicator of poverty developments by measuring poverty against athreshold, which in this particular case is fixed in real terms at 2005 level.

to support the most vulnerable members of society. Data show that during the economiccrisis, families have cut back on essential spending, probably compromising their future well-being. Public spending on disability, family and unemployment rose during the early phasesof the crisis, but these áreas are now under budgetary pressure. Governments need to consíderany further expenditure cuts carefully. Social spending and investment should target theneediest and across-the-board cuts in social transfers should be avoided, particularly in thecase of housing, child and family benefits.

15. In order to strengthen the sustainability of pensions systems and boostretirement i neo me adequacy, the latest edition of the OECD Pensions at a Glancepublication calis on governments to encourage people to work longer and save more fortheir retirement. The report also calis on governments to strengthen pensión safery netsto avoid rises in inequality among retirees and pensioner poverty. The report shows thatthe wealth of retirees tends to be very unequally distributed, within and between countries,and between genders. Homeownership and financial wealth are importan! factors influencingpeoples' Hving standard ín oíd age. At the same time, public services - such as health andlong-term care — have a strong redistributive effect in favour of the elderly and on theadequacy of retirees' incomes. Accounting for these assets and services is likely to play a rolein the policy debate on the adequacy of incomes and inequalities in retirement.

1.3 Financial Sector Issues

16. While G20 financial sector reforms, especially the implementation of Basel III,are advancing, 'too-big-to-fail' implicit subsidies and the interconnectedness of thebanking sector still need to be addressed effectively. High levéis of leverage in the bankingsector and vast exposures to derivatíves and structured financial products can magnifyinstability at times of financial stress. Furthermore, robust procedures need to be in place todeal with bank failures, as higher regulatory capital is insufficient to make the financial sectorresilient to shocks. There is no reasonable ex-ante capital rule for large systemicallyimportan! financial institutions that will make them safe under all circumstances. Competitivepressures should be expected to lead to the demise and eventual exit of some banks.

17. Making internationally operating banks simpler and smaller will help themanagement of failure. So far, however, national approaches to bank structural separation(the US Volcker rule, the UK Vickers proposal, as well as recent French and Germán bankreforms) have been proceeding in a fragmented manner. A more unified approach would bepreferable to avoid the regulatory arbitrage that contributed to the build-up of the crisis.

18. Progress has been made on the G20 initiative on structural banking reforms,whích the OECD is spearheading together with the Financial Stability Board and theInternational Monetary Fund. The OECD has for many years now highlighted the potentialbenefits of structural reforms for financial stability, which should facilítate swift and effectivebank failure resolution, thus helping lirm't the valué of implicit bank-debt guarantees and theextent of risk-taking before any potential failure. The OECD's Committee on FinancialMarkets has highlighted the relevance of this issue; in particular, that persistence of varioustypes of implicit bank debt guarantees for the liabilities of financial firms tend to créate moral

hazard, incentivising financial ñrms to take on excessive risks from a micro perspectiva andtoo much counterparty and systemic risk from a macro perspective.

II. INCLUSIVE AND SUSTAINABLE GROWTH

19. The global crisis has left a dramatic legacy of low growth, unemployment, under-employment, and worsening living standards for many people. The New Approaches toEconomic Challenges (NAEC) Initiative, launched in 2012, aims to engage the OECD in anorganisation-wide reflection about the roots and lessons from the crisis and to develop newadvice on structural policies to better address the challenges identífied.

2.1 New Approaches to Economic Challenges

20. NAEC is beginning to deliver results, both in terms of specific outputs and interms of effective changes in the OECD's analytical framework and "regular" producís.About one third of the 29 projects launched under the NAEC Initiative have already deliveredspecific outputs, summarized in the Synthesis Report delivered to the 2014 MinisterialCouncil Meeting (MCM).

21. The NAEC initiative has created de facto a space to think more creatively. Somekey developments have been brought out very clearly by NAEC. The Initiative hashighlighted the need for a better recognilion of the complexiry and interconnectedness ofour economies. It has also put the inequality issue and inclusiveness agenda back at thecentre of policy debates and has highlighted the linkage between the financial sectorand the real economy. NAEC has also strengthened and mainstreamed OECD work onwell-being and provided the groundwork for further developing the databases on Trade inValué Added.

22. NAEC is also having an impact on the OECD analytical frameworks and tools.The initiative has launched a series of OECD internal seminars to discuss cutting-edge andsometimes controversial research and deepen knowledge about new tools. It has promoted theuse of new data and analytical tools such as micro-data and behavioural ínsight, as well as thedevelopment of new measurements of some critical concepts, such as job quality and stocksof economic, human, social and natural capital. The NAEC initiative has also led to the use ofa greater variety of models and to the update and review of some of our fundamentalassumptions, as well as to specific changes in our forecasting practicas.

23. The NAEC initiative is aíso strengthening horizontality and promoting cross-siloapproaches to policy advice and policy making, and helping adopt a longer-term view whilebetter taking into account uncertainty into our thinking.

24. While half of the NAEC projects will deliver results at the 2015 OECDMinisterial Council Meeting, the work undertaken within the NAEC initiative is alreadybeing mainstreamed throughout the Organisation. It is also having a strong impact on theOECD Programme of Work and Budget 2015-2016.

2.2 Inclusive Growth

25. One of the major objectives of NAEC is to develop new policy analysis andrecommendations to support more inclusive growth. This responds to the OECD'sanalysis that over the long term, rising living standards across the globe and falling poverty inthe developing world have unfortunately been accompanied by widening income inequality.

26. The OECD's approach to inclusive growth is comprehensive. First, it reflects themulti-dimensional nature of well-being, including education and skills, job quality, healthstatus, environment, civil participaron and social connections (as reflected also in theHow'sLife? publication and also the OECD Better Life Index). Second, it focuses on thedistribution of economic and social outcomes to ensure that people have fair opportunities tocontribute and benefit from growth. Finally, the approach aims to establish clear Unksbetween policy instruments and their outcomes.

27. The 2014 OECD report All on Board: Making Inclusive Growth Happen has shownthat rising income inequality reflects growing inequality of opportunities and is alsoaccompanied by a greater polarisation of education and health outcomes. For instance, datafrom 14 OECD countries show that at the age of 30, people with the highest educationalattatnnient levéis could expect to live 6 years longer on average than their less educated peers.

28. The initiative has provided an analytical policy framework to identify the adverseeffects of rising inequality on growth. The OECD has shown that greater inclusiveness andthe opening up of economic opportunity can act as drivers, not dampeners, of strongeconomic performance.

29. Finally, the initiative aims at developing policy synergies and a more tailoredapproach to target disadvantaged social groups. For example, one clear-cut lesson is thatinvesting in the education of disadvantaged people pays long-term dividends for theeconomy, enhances individual well-being and makes societies more inclusive. Jn reverse,neglecting to make such investment might result in long-term costs in unemploymentbenefits, health, social cohesión and poor levéis of economic growth.

30. Another important example relates to the OECD's analysis developed in the 2014edition of the OECD Employment Outlook on the quality of Jobs and their impact on well-being. The report reveáis wide differences between countries and between socio-economicgroups, with youth and low skilled workers having lower quality jobs (in terms of earnings,job security and employment contract, and work environment). The report also shows thattemporary jobs are not necessarily a stepping stone to permanent employment and that thereis no trade-off between job quantity and Job quality.

2.3 Developing Skills

31. Developing the right skills that respond to labour-market needs and ensuringthat these skills are fully utilised by individuáis and employers are crucial for inclusivegrowth, especially in the context of high unemployment. In addition, highly skilled adults

are also twice more likely to report good health than the poorly skilled, are more likely totrust others and participate in volunteering activities.

32. The OECD Skills Sírategy provides countries with a strategic approach todeveloping relevant skills to support better Jobs and better uves. The OECD is alsoworking with countries in designing and implementing state-of-the-art national andlocal skills strategies. In Austria, Korea, Portugal, Spain and Norway the development ofthese national skills strategies is well underway; other countries are in the process ofpreparing the ground for this work. The projects are designed to foster a 'whole ofgovernment' approach to skills development, activation and use, while drawing upon a widerange of stakeholders (business, trade unions, researchers, education institutions).

33. The OECD Skills Outlook was launched in 2013, including the initial results of theSurvey of Adult Skills (PIAAC), which evalúales the skills of adults in 24 countries. Thisfirst-of-its kind assessment shows how skills are distributed across individuáis, social groupsand countries, how effectively they are used on the Job, and their relation to the economic andsocial outcomes in society.

34. Subsequent editions of the OECD Skills Outlook will provide comparativeanalysis of key issues, trends and data in the fíeld of skills development, activation and use,in OECD Member and non-Member countries. The next edition, to be launched in November2014, will have a particular focus on skills and the employability of youth.

2.4 New Sources of Growth

35. With lacklustre growth, an ageiag la bou r forcé, and growing resourceconstraints across much of the world, finding new sources of growth has become aglobal policy priority. Innovation, science and technology are major sources of productivitygrowth with strong spill-over benefits across the economy. In 2015, the Organisation intendsto complete a revisión of the OECD Innovation Sírategy that will set an action-focusedagenda for innovation, wiíh índicators and emerging good practices, and a strong focus onimplementation. Feeding into this is a suite of recent and current work to examine and betterunderstand the pathways - both technological and non-technological - of future prospects forgrowth, innovation and productivity across the economy.

2.4.1 Making the most of knowledge-based capital

36. Investmení in innovation - particularly knowledge-based capital (KBC) such asresearch and development (R&D), software and big data, organisational know-how,and intellectual properry - are now a key driver of productivity and account for agrowing share of total investment. In the US and EU, KBC contributes 20% or more ofaverage labour productivity growth. During the global economic crisis, business investmentin KBC declined by less and was henee more resilient than investment in physical capital.

37. Getting the key framework conditions right for investment in KBC is essentialand can be a low-cost step for policy makers to strengthen growth and innovation.

Policies that enable reallocation of resources to innovative firms are critical to promoting anexpansión of KBC. Moreover, ensuring that the frameworks for specifíc knowledge assets,such as intellectual property rights and big data are suited to today's knowledge-basedeconomy is also essential. Work is now underway to better define, measure and guide policyon these crucial knowledge assets.

2.4.2 The role ofyoung innovative firms in employment creation and economic growth

38. Enabling the growth of young, knowledge-intensive firms matters forproductivity growth as well as for Jobs. Evidence from 18 countries over 2001-11 suggeststhat even though young firms (5 years oíd or less) have only a small weight in the economy -they represent on average 17% of employment - they contribute more than twice as much tojob creation (42% of the total) and only to 22% of all job destruction, making them (net) Jobcreators.

39. Governments can help unleash the growth potential of young, innovative firmsby enabling policías that allow them to experiment with new business models and byfacilitating the reallocation of resources towards the most productive firms. Similar toKBC, structural reforms to product, labour and capital markets, notably markets for riskcapital, as well as bankruptcy laws that do not overly penalise failure, are essential.

2.4.3 Information and Communications Technology and the Next Production Revolution

40. Information and Communications technologies (ICT), notably the Internet, smartphones and big data, coupled with other scientific and technological advances, couldcontribute to a "next production revolution" - across the manufacturing, services and primarysectors. Such a revolution would have implications for the structural shape of economies andthe global system of production, and could help boost growth prospects across the globe.

41. OECD is conducting new work on the potential impact and policy implications ofnew and emerging technologies on growth and productivity. This future work will focuson technological changes (industrial bioíechnology, nanotechnology, machine-to-machinecommunication, big data and other ICT technologies, 3D printing and other advancedmanufacturing technologies) and other drivers that could strengthen future productivity andinnovation. Recognising that people's competencies are a key pillar of countries' success inharnessing new technologies and upgrading in the valué chain, the OECD will also look atthe Jobs and skills associated with countries' valué creation processes.

2.5 Sustainable Growth: The Zero-Emission Challenge

42. There is increasing evidence that environmental degradation and over-use ofresources will have damaging effects on economic and social sustainability. Innovation intechnologies, and how they are applied, are crucial to enabling industry to créate newbusiness valúes while also benefiting people and the planet.

43. Among the various envíronmental challenges, climate change poses the mostcomprehensive set of global risks. While the full effects of unfettered greenhouse gasemissions are likely to produce their largest damages after 2060, rising global temperatureswill start to affect GDP earlier. New OECD projections from the OECD@10Q and CIRCLE(Costs of Inaction and Resource Scarcity: Consequences for Long-term Economic Growth) -both projects under NAEC - suggest that climate change may lower world GDP in 2060 bybetween 0.7% and 2.5% in the case of a 1.5°C to 4.5°C warming.

44. The OECD promotes the use of an array of tools to help countries tac lile climatechange; besides carbón pricing, an important one is eco-innovation. In recent years,manufacturing companies have been upgrading their efforts towards sustainablemanufacturing from pollution prevention to integrated approaches that take into accountproduct lifecycles and wider impacts. Eco-innovatkm helps to enable this evolution. TheOECD Project on Green Growth and Eco-innovation was launched in 2008, with the initialaim to better understand how innovation can result in new technological and systemicsolutions and to provide industry with a means to improve their contributions to sustainabledevelopment.

45. The globally agreed climate goal - keepíng the íncrease in global averagetempera tu re below 2 degrees Celsius - implies the need to move towards zero netemissions from fossil fuel combustión in the second half of this century. This requires aradical departure from current policies. The economic transformation needed to achieve thisis not well understood, as no economy has accomplished this transítion fully to date. There is,however, a wealth of experience with emissíon-reduction policies, including some importantsuccess stories, but also some clear lessons on the challenges ahead. These include the highcosts of poorly aligned sets of policies, the limited effectiveness of a number of policyapproaches, and the lack of credible long-term policy frameworks, including carbón pricing.

46. The OECD and the IEA, together with the International Transport Forum andthe Nuclear Energy Agency, will draw on their respective work to report back toMinisters at the 2015 OECD Council Ministerial Meeting with advice on how toimplement the transition to a low-carbon economy. This will draw from difieren! policydomains including: (i) the organisation of the electricity sector and markets; (ii) the role ofenergy and environmental taxes; (iii) the trade aspects of support measures for thedevelopment of clean energy; (iv) how to attract prívate fínance for green infrastructure and(v) the intersection of agricultural and energy policy choices. The potential distributional andcompetitiveness effects of the low-carbon transition will also be examined.

HI. TRUST

3.1 OECD Trust Strategy

47. In the October 2013 discussion, PACE also emphasized that restoring trust ingovernment is a matter of central concern to sénior policy makers. The deterioration oftrust in the last years has been driven by citizens' sense of unfairness concerning thedistribution of the costs of the crisis and of the policy responsos as compared to the

10

distribution of the benefits of the expansionary períod that preceded U. This is furtherexacerbated by a public perception that regulators and policy makers did not interveneeffectively in the áreas which prompted the crisis, particularly financial markets.

48. Low levéis of trust can make it difficult to mobilise support for policy reforms,reduce compliance with regulations, including the willingness to pay taxes, and hitinvestors' confídence. In order to rebuild trust, governments will need to demónstrate thatthey can anticípate crises, are responsive to citizens' expectations and needs, effective in theway they manage markets, and fair and transparent in the way they make policies.

49. The OECD Trust Strategy will provide policy support for governments to help themregain public trust, building on core strengths in áreas such as integrity, anti-corruption andopen government, developing measurement tools, and showing how policies to build trustcan help inform and support policy reform in diverse áreas such as tax policy, corporategovernance, and education. The Trust Strategy will include a substantial component onsecuring fairness in policy-making. This work will build on ongoing OECD work in keyáreas such as lobbying, public procurement, post-public employment, and the financing ofdemocracy. The Strategy will also include ínnovative approaches to measuring trust.

3.2 Base Erosión and Profit Shifting

50. In 2013, tbe enlarged assembly of PACE provided strong and specific supportfor the OECD's work to ensure tax fairness by reforming international tax rules. Thiswork was launched in 2013 under the auspices of the OECD/G20 Base Erosión and ProfitShifting (BEPS) Project. In Hght of the pressing need for reforms in this área, OECDmembers and G20 Leaders committed to an ambitious timeline to deliver outputs relating to15 key action points by the end of 2015.

51. In recent years, it has become increasingly clear that the current international taxrules, some of which stem from principies developed in the 1920s, have not kept pacewith the way business operates in the 21st century and the globalised economy. In somecases, the international tax rules, designed to elimínate double taxation, have been used bymultinational enterprises to facilítate double-non taxation. The result has been to distorteconomic activity, thwart the policy objectives of governments, decrease governmentsrevenues, and ¡ncrease citizens' sense of unfairness.

52. At the September 20-21 meeting of the G20 Finance Ministers in Cairns,Australia, the OECD's Secretary-General presented the 2014 deliverables of the BEPSAction Plan, covering 7 key áreas of the international tax rules. They includerecommendations on improving transparency of mulíinational enterprises through country-by-country reportíng requirements, addressing existing opportunities for treaty abuse and thegaps caused by mismatches between countries' domestic tax rules, and propose an agreementon the way forward to address the tax implications of the digital economy.

53. Implementation of the project's recommendations will be crucial. Implementationwill require changes to the international tax rules (such as the OECD's Transfer Pricing

11

54. The 2014 deliverables are only the first step in the BEPS Action Plan, which willdeliver final outputs—including 8 additional elements— by end 2015.

3.2.1 Automatic Exchange of Information

55. Since 2009, when the Leaders of the Group of 20 declared that "the era of banksecrecy is over", the Global Forum on Transparency and Exchange of Information for TaxPurposes has restructured and expanded. It now comprises more than 120 memberscommitted to implement the international standard on tax transparency and exchange of tax¡nformation on request. The Global Forum's peer-based review system is in place to ensurethat countries' commitments are continually monitored, and an overall compliance rating isassigned - already more than 60 jurisdictions have received an overall rating.

56. Starting in 2012, a u toma tic exchange of information (AEOI) - which is thesystematic and periodic transmission of bulk taxpayer information - has been central to theOECD's efforts to modernise the international tax system. In 2013, the enlarged assemblyof PACE itself called for the OECD to "puso for a "Big Bang" approach on AEOI. InFebruary 2014, the OECD released a single common global AEOI Standard. This wasfollowed in July with the reléase of guidance to complement the Standard and the fulltechnical details necessary for ímplementation. The development of this global standard haskey advantages including process simplification, higher effectiveness, and lower costs for allstakeholders (governments, financial institutions, taxpayers). The AEOI Standard is also inline with the Financial Action Task Forcé requirements regarding beneficial ownershipinformation.

57. With the AEOI standard now agreed, the focus must shift to coherent and timelyglobal implementation. Already more than 60 countries have committed to Ímplementation,and 45 jurisdictions have agreed to an ambitious, specific timetable that will see the firstexchanges take place from 2017. The Global Forum is putting in place a commitment processthat calis on its 122 members to implement AEOI, and is working on a process to monitormembers' implementation of the Standard. In general, Global Forum members are urged tocommit to implement AEOI in accordance with a specific timeline, enabüng them to startexchangíng information automatically by 2017 or 2018. However, the Global Forum hasinvited developing countries that are not financial centres to consider committing to AEOIimplementation in a timeframe commensurate with their tax reform priorities and capacity.

IV. TRADE AND INVESTMENT

4.1 Decodíng the "Trade Cenóme"

58. Trade and investment remain the linchpín of our growth model. Over the past years,OECD's work on Trade in Valué Added-Global Valué Chains (TiVA-GVC) has

12

Guídelines) as well as amendments to domestic tax laws. Effective implementation will

changed our understanding of global trade, investment and production patterns,leading to better measurement of the gains from trade and the costs of protectionism.Reducing global trade costs by 1% would increase world-wide income by more than USD 40billion, 65% of which would accrue to developing countríes. We have begun to decode thetrade genome leading to an adjustment on the way in which trade policy is conceived;recognizing that success in international markets depends as much on the capacity to importhigh-quality inputs as on the capacity to export. The OECD has thus also looked at "behindthe border" regulatory measures, as well as "at the border" trade facilítation measures.

59. Since the mid-1990s, international trade and investment have undergoneaccelerated changes with the emergence of global valué chains (GVCs) and theincreasing fragmentation of the production of goods and services across the globe. In2009 (latest year available), trade in intermedíate inputs made up over 50% of goods and70% of services trade.

60. Participating in GVCs depends on government policies that affect trade costs. Tariffsand other barriers to trade are cumulative, and even "low" tariffs and other barriers can addup to a significant level when the finished good reaches customers. While open markets are acritica! factor of enabling partícipation in GVCs, they are alone insufficient. GVCs also needto be complemented with labour market, social and competition policies as well as policiesfor investment in education, skills, technology and strategic infrastructure.

61. In recent years, many countries have actively sought to establish new bilateral andregional trade agreements (RTAs) to increase trade and spur economíc growth. CurrentRTAs are already on a path that moves beyond existing multilateral rules on issues likeinvestment, movement of capital and persons, competition and state-owned enterprises, e-commerce, anti-corruption, and intellectual property rights. These are essential issues thatneed to be addressed in today's more interconnected markets. Recently-announced mega-regional initiatives are on an entirely new scale. The three largest mega initiatíves - theTrans-Pacific Partnership (TPP), the Transatlantic Trade and Investment Partnership (TTIP),and the Regional Co-operation in Asia and the Pacific (RCEP) - represen! over three quartersof global GDP and two-thirds of world trade. Initial ambitions of these agreements arecertainly high, and some aim to go beyond providing preferential access to membercountries' markets, seeking to establish "high standard" 21st century trade agreements withdeep and comprehensive market integration.

62. This year, the OECD is focusing on improving our understanding of howdeveloping countries and SMEs can better intégrate into, and benefit from, GVCs. Thiswork was centrepiece in thís year's G20 Trade Ministers' Meeting in Sydney, where theOECD presented a joint report with the WTO and World Bank Group entitled "Global ValuéChains: Challenges, Opportunities, and Implications for Policy".

63. The OECD's work on TiVA reveáis the importance of services in GVCs.Significant shares of services are embodied in exports of goods and they represent over30% of the total valué added in man u fac tu red goods. Liberalisation of services tradewould thus not just benefit services sectors themselves, but would also enhance the

13

competid ve ness of manufacturing firms. This year, the OECD released a services regulatorydatábase and services trade restrictiveness índices (STRI) for 40 countries across 18 majorservices sectors. The STRI is a unique tool to identify áreas of regulatory strengths,weaknesses and opportunities for improvement of countries' service sector performance. TheSTRI also provides an indispensable tool for advancing services trade negotiations atmultilateral level.

64. The TiVA datábase has been complementad with a new set of indicators relatingto Jobs and will be further complemented with indicators that provide ¡nsights into the role ofinvestment in GVCs, revealing the contribution made by foreign affiliates to value-added andemployment, íncluding the value-added that 'sticks' in the host economy. The datábase willbe further updated in Q4 2014 to include indicators for 61 countries across 34 industries.

4.2 Long-term Investment (LTI)

65. According to the OECD, the total need for global infrastructure investment by2030 is approximately USD 71 trillion. Over the last two decades, there has been a strongreduction of public capital committed to such investments. The average ratio of public fixedinvestments to GDP has fallen from above 4% to about 3%. The prívate sector has beenunable or unwilling to take over from governments: in 2010-2012, only 8% of FDI inflowsreceived by OECD countries were going to infrastructure sectors, as opposed to more than10% during the period 2007-2009.

66. Besides the weak economic environment, ¡mportant deficiencias in frameworkconditions are reducing incentives and returns to investors, undermining investment ininfrastructure. The OECD FDI Regulatory Restrictiveness Index shows that infrastructuresectors and capital-intensive network industries are among the most restrictivo sectors toforeign direct investment in G20 economíes. This is especially the case of restrictivoregulations such as ownership restrictions. Structural weaknesses in the financia! system,such as the consequences of the crisis on banks' balance sheets or the impact of new bankregulations, also affect the ability of banks to provide long-term financing.

67. Alternative sources of LTI exist, such as insütutíonal investors and the USD 80trillion euros of assets they manage (2012), but less than 1% of these assets are invested íninfrastructure. The obstacles to their wider particípation in LTI include a lack of appropriatefinancing vehicles, regulatory disincentives, and their fiduciary duties that make themespecially risk adverse in their cost/benefit analysis of infrastructure projects-

68. The OECD provides guidance and recommendations to in crease private sectorparticipation in infrastructure investment and financing. * Policy recommendationsinclude: a) enhancing the stability and predictability of the regulatory framework, transparentbidding and awarding procedures; b) improving the incentives structure of systemic banks

5 This work is contained in the G20/OECD High-Level Principies on Long-Term Financing byInstitutional Investors, approved by G20 Leaders at their Summit in St. Petersburg in 2013, and theOECD Principies for Private Sector Participation in Infrastructure.

14

through the separation and ring-fencing of their traditional (retail) and most risky(derivatíves) actívities; and c) strengthening public equity markets and addressing the specificobstacles encountered by institutional investors.

V. THE POST-2015 DEVELOPMENT AGENDA

69. The OECD will continué to support the international development agenda and tomainstream development, focusing on promoting greater policy coherence for developmentand inclusive knowledge-sharing among donors and with development countries, andenhancing its contribution to the global development architecture.

70. In 2015, the global community is expected to agree a successor framework to theMillennium Development Goals (MDGs). The post-2015 development framework will aimto intégrate the economic, social and environmental dimensions of sustainable developmentin a coherent and balanced manner. The OECD is offering its convening power, policyadvice, and data for the definition and implementation of the agenda.

71. The Global Partnership for Effective Development Co-operation — whichbenefits from joint support from the OECD and UNDP — will be an importan! ciernentfor im píeme nting the post-2015 framework. It offers a platform where all stakeholderscome together voluntarily to track progress, hold each other to account and learn lessons forimproving the way they work at the country level. It also offers a mechanism for monitoringimplementation of commitments, using developing countries' own data and processes totrack progress at the global level.

72. Promoting gender equality will be a key theme for the post-2015 agenda,especially as progress against the existing MDG on gender equality has been limited.The OECD's Social Institución and Gender Index, published in May 2012, is measuringdiscriminatory social institutions and how they impact gender inequality and therewithdevelopment outcomes. The framework includes clear transformative indicators on socialnorms that hold women back to track progress throughout women's life cycle.

73. The OECD will also focus on integrating its measurement of well-being into thepost-2015 agenda, targets and indicators. OECD work in this área has been referred toextensively in the context of the UN post-2015 process, including the 2013 UN GeneralAssembly Resolution on Happiness. In general, the OECD aims at purting into practice amulti-dimensional approach to development encompassing the economic, social andenvironmental dimensions lying at the heart of the post 2015 agenda, and in line alsowith the NAEC and inclusive growth inítiatives. The OECD has been adapting theframework used by the OECD in its well-being work (How's Life? publícation, the OECDBetter Life Index) to better reflect the priorities of people in low- and middle-incomecountries. It could be used in the context of the OECD Multi-Dimensional Country Reviews.

15

COUNTRYNOTE

®»OECD

EDUCATIONATAGLANCE2014

Education at a dance: OECD Indicators is the authoritative source for accurate and relevant¡nformation on the state of education around the world. It provides data on the structure, fínances andperformance of the education systems ¡n the 34 OECD member countries, as well as a number of G20and partner countries.

ChileUpper secondary education is the most common level of educationattained in Chile, and progress across generations is notable.

Upper secondary education, which consolidates students' basic skills and knowledge, aims to preparestudents for entry into tertiary education or the labour market As in most OECD countries, uppersecondary education is the most commonly attained level of education in Chile. At least 57% ofadults (25-64 year-olds) have attained upper secondary education, which is significantly lowerthan the OECD average of 75%. However, there has been a clear increase in attainment ratesbetween the younger and older generations. For example, 77% of 25-34 year-olds in Chile havefínished upper secondary education (the OECD average is 82%) while only 38% of 55-64 year-olds have (the OECD average is 64%) (Table A1.2a).

Moreover, nowadays it is expected that 84% of Chileans will complete upper secondary educationover their lifetime, which is equal to the average across OECD countries. The majority of those willgradúate from a general programme (55%), yet vocational education and training (VET) is animportant part of upper secondary education in Chile, chosen by almost one-third of these newgraduales (Table A2.1).

Chilean 15-year-old students performed better in mathematics in 2012than they did in 2006, but there are large differences in performancebased on gender and socio-economic status.

In 2012, Chilean 15-year-old students had an average PISA1 score in mathematics of 423 points. Thisrepresents an increase of 12 score points with respect to PISA 2006 and represents one of thestrongest improvements across OECD countries.

1 PISA ¡s the OECD Programme for International Student Assessment

Chile - Country Note - Education at a dance 2014: OECD Indicators

While PISA 2012 results show that in most OECD countries boys perform better than girls inmathematics [11 points difference between them on average) Chile recorded the largest differencein mathematics performance between boys and girls in PISA 2012, with a difference of 25 scorepoints (Table A9.1a). Moreover, students from disadvantaged families are less likely to achieve highlevéis of performance. More than 23% of the difference in student performance can be attríbutedto their socio-economic status, while on average in OECD countries socio-economic statusaccounts for 15% (Table A9.2).

ChartA9.4. Student performance and equity

^ Strength oí the rdatknuhip between performance and codo-economle itatus ti obove the OECD mrenge

ti Dot ctaüiüaJlf rignlficanthr differait from the OECD svetsg*StrengthrfthereUHon»hipbetweenp«rf6iinjiiceaniJ«Qdo^«Mwn^

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The benefits from higher education are significant in Chile, both inemployment and earnings.

Since tertiary attainment is low in Chile, those who have higher education benefít from a betterposition in the labour markeL The percentage of 25-34 year-olds who have attained a tertiaryeducation is just 18%, oneof the lowestrates among OECD countries, for which the average is of 32%.

The employment rate in Chile was around 68% for 25-64 year-old adults for all levéis of education

©OECD 2


corabined in 2011, but the chance of being employed varied according to their educational status(Table AS.la). While 84% of adults who held a university qualification had a job, only 59% ofthose who didn't complete upper secondary education were employed (Table A5.3a). On theother hand, data on unemployment show that a tertiary qualification does not offer much guaranteeagainst the risk of unemployment: 5.6% of those with a tertiary qualification were unemployed, butonly 4.6% of adults without an upper secondary qualification (2010). The unemployment risk is muchhigher for tertiary-qualified 25-34 year-olds (9.5%) than for tertiary-qualified 55-64 year-olds (3.1%)(Table A5.4a).

At the same time, employed adults with tertiary education can expect to earn about 160% moreover their lifetime than adults with upper secondary education, who, in turn, earned 34% morethan their peers without an upper secondary education. When it comes to earnings, age matters alot: the earning premium for tertiary education is 127% for 25-34 year-olds, while it is 179% for 55-64year-olds (Table A6.1a).

Awareness of the importance of early childhood education is growing.

Enrolment in early childhood educatíon is lower than the OECD average for both 3 and 4-year-olds: in 2012 only 45% of 3-year-old children and 79% of 4-year-olds partí cipa ted in earlychildhood education, whereas the OECD average participation rate was 70% and 84%, respectively(Table C2.1). There is a growing awareness in Chile of the importance of early childhood education forthe cognitive and emotional development of the young and to prepare pupils to enter and succeed informal schooling. m this context. Chile ís increasing its efforts to consolídate early childhoodeducation and devotes 0.8% of its GDP to this type of programme, 0.2% more than the OECDaverage (Table C2.2).

Chart C2.3, Expenditure on early childhood educational institutíoiu (2011)As a percentage ofGDP, by funding source

• Prívate expenditure on educational instttutíons ai a percentage of GDP• Public expendltuie on educational ínsHtutíons as a percentage of GDP

KofGDP • Ttjtal1.4

1. Indudes same expendítura on chflikare.CountrtesartrinikÉdindesawhngftáerofpubfcmidprtwtfexpeítátwvonfduHito^Source: OECD. Tibie C2.2. See Annex 3 for notes {wwwj}K¿Lor$fedu/eag-htm')-

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©OECD 3

Chile - Country Note - Education at a Glance 2014: OECD Indicators

Chile invests an above-average share of its wealth in education, butspending per student is still relatively low.

Expenditure per student in Chile increased steadily over the last two decades, and has morethan doubled since 1995, making Chile (together with Poland, Estonia, Ireland and the SlovakRepublic), one of the OECD countries that most increased their financia! commitment toeducation.

Chile spent 6.9% of its GDP on educational institutions in 2011, above the OECD average of 6.1%(Table B2.1J. Between 2005 and 2011, educational institutions in Chile increased expendlture perprimary, secondary and post-secondary non-tertiary student by 62%, the fastest increaseamong OECD countries. However, it still spent among the lowest amount per student (TableBl.Sa). In 2011, Chile devoted about USD 5 522 per student each year at all levéis from primary totertiary, compared with the OECD average of USD 9 487 per student (Table Bl.la).

Public expenditure on education continúes to increase, but prívate fundingstill domina tes, especially at the tertiary level.

In contrast with most OECD countries, the share of public funding at primary, secondary and post-secondary non-tertiary education increased in Chile between 2000 and 2011 from 68% to 78% (TableB3.2b).

However, Chile has the highest share of prívate expenditure on all levéis of education with40% of education expenditure coming from prívate sources (Table B3.1). Most of this prívateexpenditure is from individual households. This situation is even more significant at the tertiary level.Chile has the smallest share of public expenditure in tertiary education of all OECD countries:the proportíon of prívate expenditure is about three-quaners (76%), against an OECD averageof less than one-third (31%).

OECD 4

Chile - Country Note - Education at a Glance 2014: OECD Indicators

Chart B3.3. Share of prívate eicpenctiture on tertíary cducational institutíona(2000, 2008 and 2011)

12011 2000

1. Same levéis of educaOon are tnduded wlth othcrs. Rcfer to V cade in Tibie B1.1 a for detalla.Countries are ranked tn dexending arder af tht shan ofpmttte expendtture on educaaonalínstíTiitionstnSQll.Source: OECD- Tibie B3.2c. Scc Aimex 3 for notes (unew.oeaLorg/edu/eag.htm).StftíJntt «*?• W:Ep,//dif:.dcil.anj/10-17B7/BBB933117SlÉ

A relatively large proportion of 15-year-olds in Chile attend prívateschools.

Comparatively few 15-year-old students attend a public school, organised by public authorities:37%against an OECD average of 82%. The remaining students can be divided between thoseattending "government-dependent prívate schools", which receive the majority of their funding frompublic sources (48%, compared with the OECD average of 14%), and those attending "government-independent prívate schools", which receive less than halfof their resources from public sources (14%,compared with the OECD average of 4%). The profile of the school landscape is similar to that of TheNetherlands or Belgium.

Across countries, the proportion of students in prívate schools is unrelated to the magnitude of thedifference in performance between students who attend prívate and public schools. Students whoattend prívate schools tend to be more socio-economically advantaged than students who attendpublic schools. Thus, ín most countries prívate schools tend to show better performance than publicschools. Thís also is the case in Chile, where the performance difference is 53 score points on thePISA scale ¡n favour of prívate schools. But this difference can be almost entirely attributed tostudents' and schools' social background, as measured by the PISA índex of economic, socialand cultural status. After accounting for social background of students and schools, theadvantage diminishes to a statístically non-signifícant 8 score points (Table C7.2).

OECD 5


Chart C7.2. Sehool type and raathematica performance (2Q12)

t*™l. Omcnuant'

prirate «fliíHiJr*

+^> Otwerved pafanuaxe dtffcrenec^ [> Vei <u iikinoe diOcmnce afinar accoucting far ÚM PISA imfci

D^nniniú; «aejiif «mftnfegWMtitfmnt «tmltati• O Ftjfuimncg iSJnem iBer aceoucitiiiK (di tte PJSA «Jn

•f jgunomic. iKKirfBiidcBfriralitm» of Mudent» ñu] Kliaali

ChinaaeTkipdHong Kant-China

VietNam

SwftzerkndIndonesiallaly

C>0Japan

O>>—ONedierbaadiforañaAlbaniaUnitad States

HonjprySwedenKoru

" paÜMOunce «Hantap'of ptivuti

<0

United KinplaitiFfenlmdDenroaik

PerneeSHwhai-dbánaAnitta&aSbiñn

MéxicoGenun?AustriaColombiaOdeGanadaPolandJordánArgentinaUnited Aiab BnuntecPortugalPeniCorta RicaBranlNewZaabnd

SloveniaUniguay

-125 -100 -75 -50 -25 25 50 75Sane point

10O

Noten Whlte «yrabds repiEsait ihfierencaK that are not ataH3HtaDy mgntítcanL1. Síhool» that are dftectíy controBed or manageá bf: a piibltc educaban authonty or agencv. ar a npvenmiajt agencj itrectly or a gcwtnoat of whose membets ara elther appomted by a ptiblk autborlty ordected bjf pubbc frantMiB,2. Schools üiat lecelve SO* or more of thflr toa toiding (Le. hmdtag that euppórta SwbasurediiaOMiJserwlcaiDf tiielnaütuÜoi3}fTnmgGverTinMnt

a gande i.Cotatcnm and ecaxaraesart ranJud tn JsKendttyordtr ofdiexan-paoa Afirreme tn nwhamttcs peí fui ir unce berwten pubhc antf prima* stAooii (guvamntnt-¿fpenJait andgpvtrnmfat-tndfpenJtní nAonii comhncd).Souice: OECÜL Tilde C7J, See Aimex

©OECD 6

Chile - Country Note - Education at a Glance 2014: OECD ¡ndicators

Initial teacher training is relatively long, but upon graduation, teacherscan immediately begin teaching.

Almost all new teachers entering the system have attained a bachelor's degree and, among the currentteaching forcé, more than 95% of teachers hold this type of qualification (Table D6.1b). While inapproximately half of the countries with available data, places in teacher education programmes arerestricted to a fixed number, that's not the case in Chile. Other than diploma requirements, there areno additional selective requirements for entry into inítial teacher training; rather, candidates areselected based on their secondary school grade-point average (Table D6.2b).

The duration of initia! teacher training ranges widely among countries: from two years for basiccertification in Japan, to five years in Austria, Chile, France, Iceland and Italy. In addition, while insome countries the duratíon of teacher training increases from primary to lower secondarylevel, in Chile it is five years for both and only half a year longer for upper secondary teachers.However, teachers are not offered formal induction programmes when starting their teaching career.Teachers in Chile can start teaching directly after graduating from their initial teachereducation - they do not have to meet any additional requirements, such as pass a competí ti veexamination or a standardised test, as in France, Korea, México, Spain and Turkey (Table D6.5b andD6.5c).

Chart D6.2. Duration oí initial teacher «ducation (2013)For teachers teaching general subjects in public institutions

femB

»Pre primary educatlon • Lower secondary educatJonO Primary education A Upper secondary education

I I III I IIIII . l i l i l í . . IIIIIIIII I I I fflI I III I I I I I I l i l i l í I I I I I I I I I I I I IIII I III I IIIII I I I I I I I I I I I I I I I I I I IIII I III I I I I I I I I I I I I I I I I I I I I I II I III

6 1fi-

1-Year of refera noe 2014,2. Refere to teachera in academk secondary school only, for lower secondary education.Countries are runked tn dexcndtog arder of the dunttton of natal teacher educatlanfbrlowfTStCondary teachers.Soorce: OECD. Tables D6.1a. b. c and d. Se* Anuía 3 for notStfOJnk «E0« t±tp1//dK.dDÍ.™g/10.1787/868931120423

© OECD 7

Chile - Country Note - Education at a dance 2014: OECD ¡ndicators

Despite teaching longer hours and larger classs, teachers earn some of thelowest salaries among OECD countries.

Teachers' salaries are among the lowest for all OECD countries. An upper secondary teacher with 15years of experience earns USD 26 195 a year while the OECD average is USD 42 861 (Table D3.1).Chilean upper secondary teachers earn 77% of what other tertiary-educated full-time workers in Chileearn, compared with an average salary gap of 92% across all OECD countries. They also work morehours than their counterparts in other OECD countries: for all levéis of education, Chilean teachers canteach up to 1 103 hours a year while the OECD average is 1 001 hours for pre-primary, 782 hours forprimary, 694 hours for lower and 655 hours for upper secondary teachers (Table D4.1). Chile has oneof the highest ratio of students to teaching staff. In secondary schools there are 23 students for everyteaching staff member, while the average OECD ratio is 13:1 (Table D2.2). Primary class size is thesecond largest among OECD countries with 29 students per class, after China (with 38 students).Chilean teachers are also younger than those in other OECD countries: 20% of primary teachers areunder 30 whereas the OECD average is 13% (Table D5.1).

Other findings

• The transition from school to work in Chile is challenging for young adults: 22% of 15-29year-olds were neither employed ñor in education or training (NEET) in 2011. This was one ofthe highest levéis among OECD countries after Turkey (35%), Israel (28%), Spain (24%), Italy (23%)and México (23%). The proportion of women NEETs was particularly high: 30% of 15-29 year-oldwomen were neither in education ñor working, the third highest percentage among OECDcountries (Table C5.3a).

• At the tertiary level, the gender difference in earnings is the highest among OECDcountries. Women with a tertiary degree earn only 62% of what tertiary-educated men earn (TableA6.3a).

iWíWtMÍfcwliw.-: - " í T ' " < ! ' - ; ' , • - / ' i' ;;' \' V i""V '"^-.F^"'1'' ''í 'C^V ;"-'" Í.T.' l^'.V'1 .V- '•

For more information on Education at a dance 2014 and to access the full set of indicators, visitwww.oecd.org/edu/eag.htm.

Questions can be directed to:Andreas SchleicherDirector for Education and SkillsEmail: [email protected]: +33 6 07 38 54 64

Country Note author:Lisa Kerdelhué & Ignacio MarínDirectorate for Education and SkillsEmail: Ignacio.Marin(5'oecd.org

©OECD 8

Key Facts for Chile in Education at a Glance 2014

3-year-olds [In early chlldhood education)

4-year-olds (In early childhood and primaryeducación)

5-14 year-olds (all levéis)

Youth expected to enter tertlary-type Aprogrammes befo re turnlng 25

Percentageoftoda/syoungpeople expected tocomplete upper secondary ed u catión In theirllfetlme

Percentaje oí today's young people expected tocomplete universlty educatlon (tertiafy-type A) intheir Hfetlme

Below upper secondary

Upper secondary and post-secondary non-tertiary


Upper secondary and post-secondary non-tertiary


Key Facts for Chile in Education at a Glance 2014

As a percentage oí total publíc expenditure

Prlmary, secondary and p o st-secondary nontertiary education

"Colíntries areranked in descendíng arder of valúes.

" Comparad to people with upper secondaiy education; upper secondary = 100.

'm': data ís notavallable. 'n': magnitudeís eithernegtiglbleorzero.

OECDAVTO TRADE IN VALUÉ ADDED (TIYA) INDICATORS

CHILE

Chile's domestic valué added content of its exports was 82% in 2009, well above the OECD average andslightly below its level ín 1995 (Fig. 1). Like many other countries the domestic content of its exports roseslightly in 2009 compared to 2008 (79%) reflecting the impact of the crisis on global valué chains. Therelatively low foreign content in Chile's exports mainly reflects the high importance of the upstream miningindustry in its export basket. Mining contributed 44% of the total valué added exports in 1995 and over half in2009, a growing share in pan due to the environment of high commodity prices.

Figure 1: Domestic valué added content of gross exports, % (EXGRDVA_EX)

100%

80%

60%

40%

20%

• 2009 0 1995

°0

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<> <> <> <> '> •c> <>

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- S teI ? 2 S üí tú < O Q. Q ^

The foreign content of Chile's exports was highest in the Chemicals and minerals industry (49%) and ÍnTransport and lelecommunication services (44%) Ín 2009, and lowest in Mining (5%). The foreign contentshare rose sharply between 1995 and 2009 Ín Chemicals and minerals and Transporí and Telecommunications,but fell by 20 percentage points (pp) in Eléctrica! eqmpment and around 5 pp in Finance and Insurance andMining over the same period (Fig. 2).

Figure 2: Foreign valué added content of gross exports, by industry, % (EXGR_FVASH)

• 2009 0199560%

50%

40%

30%

20%

10%

_to O)

JUs a-Í" P!

S 2 -i

A different pattern emerges regarding the share of imported intermedíate inputs that are used to produceexports (Fig. 3), which was one of the highest among goods ¡n Mining (41%). This reflects the extent towhich Chile is integrated in global valué chains in the mining sector. High shares are also recorded in Woodand paper (42%) and Agriculture (36%).

Figure 3: Share of ¡mported intermedíate inputs that are exported, by import category, % (REÍ)

12009 O 199550%

40%O

In 2009, Wood and paper contributed 10% of Chile's total valué added exports. Europe and NorthAmerica were the main sources of foreign intermedíate inputs, accounting for respectively 7% and 6% ofvalué added ín the sector (Fig. 4). The contributions from upstream European and North American suppliersincreased slightly from 1995 to 2009, while the contribution from East and South East Asian valué addedrose signifícantly (from 1 to 5%), particularly in servíces sectors.

Figure 4: Foreign valué added in Wood and paper, by originating región and industry, %

[Figure 4 ¡Ilústrales how the Ti VA infraslructure can be used to focus on the origins of foreign valué added in theoutput of a particular sector in a particular counlryj.

Looking at gross trade flows, China is by far the main destination for Chilean exports (22%) and theUnited States is in second position (13%). In valué added terms, however, the United States becomes themain export market and receives 16% of Chilean exports (Fig. 5). The share of exportsto China falls to 15%,as Chile exports primary commodities that are used in the production of Chínese goods that are subsequentlyexported to the United States. On the import side, the main trade partners remaín the same, although Japan isa more important source of imports than Brazil when looking at valué added imports.

In valué added terms, 30% of Chile's exports originated in services sectors in 2009f the lowest share ofall OECD countries and 4% less than in 1995 (Fig. 7). This largely reflects Chile's specialisation in miníngactivities, which have a low and declining share of services contents (12% in 2009 and 22% in 1995). Theservices content of gross exports is highest in Wood and paper, Food producís and Textiles and apparel,where services contribute over a third of valué added (Fig. 8).

90.0

80.0

70.0

60.0

50.0

40.0

30.0

20.0

10.0

00

Figure 7: Services content of gross exports, 2009 (EXGR_*_SV; SERV_VAGR)

I Domestic content • Foreign content O Total 1995

- . • • • .| |

a i i i i i i i i i i i i¡ i i i i i in i i i i ii i i i i i in i i i i i35 3 S « t < o > n : 3 £

t a O f l i < i « < - ' < - iü i oe =>

Figure 8: Services content of gross exports, by ¡ndustry, 2009 (EXGR_*_SV; SERV_VAGR)

i Foreign service contents • Domestic seivice contente o 1995 Total

O

The Information ¡ncluded in this note is based on the May 2013 reléase of the Trade in Valué added (TiVA)datábase. The data can be accessed from www.oecd. ora/trade/valueadded. For further Information, picasecontact us (tíva.coníact&oecd.ora).

Figure 5a: Exports, partnershares. in gross and valué added terms (as a % of total), 2009

BÉtó JíM

USA CHN JPN BRA DEU KOR IND FRA ITA GBR CAN ESP MEX AUS TWN

Figure 5b: Imports, partner shares. in gross and valué added terms (as a % of total), 2009

USA CHN ARG JPN BRA DEU KOR ESP FRA GBR ITA MEX CAN HKG RUS

The domestic valué added embodied in exports, and intermedíate imports embodied in exports, combineto reveal notable differences in Chile's trade balance positions with some of its major trading partners (asrecorded in the OECD-WTO TiVA datábase). The trade surplus with China was reduced by over half invalué added terms in 2009, reflecting Chilean valué added in China's exports to third countnes (Fig. 6). Thesurpluses are also smaller with Japan and Korea. Conversely the gross trade déficit with the United Statesturns into a surpius in valué added terms, and the magnitude of the déficit with Argentina is reduced.

Figure 6: Bilateral trade balances, USD million, 2009

10,000

8,000

6,000

4,000

2,000

O

-2,000

-4,000

-6,000CHN

^$^?! ^ P^

JPN IND TWN ITA KOR BRA DEU IDN HKG USA ARG

»OCDEM E J O R E S P O L Í T I C A SP A R A U N A V I D A M E J O R

En el gobierno central de Chile, losprofesionales sénior ganan aproximadamente1,6 veces más que sus colegas de la categoríajúnior, la segunda brecha más alta de la región.

En Chile, el nivel central de gobierno realizael 95% de la inversión pública, la proporción

más alta entre los países de ALC.

En ALC, Chite tiene la deuda publica más bajacomo proporción del PIB: 11%.

Como leer los gráficos:Los valores han

sido redondeados

Valor del país en celeste(no representado si no está disponible)

Rango de valores deALC en gris

Promedio de valores deALCenpúpura

Deuda publica(2011)

Balanza fiscal(2011)

Gasto publico(2011)%del PIB

Ingresos públicos(2011)

% del PIB

Fuenle: FMI, Porspoctivas Oe la Economía Mundialf! gcOtiemo de Chile ouDIica esladlslicas en wtw ttigfes. el

Fwnle FUI, Perspectivas de la Economía Mundla

Bgobierno de ChitopuKlia estadísticas wi mw.üipi8s elFuente: FMI, Pwspacllvas de la Economía Mundial

BgoOiemí <K Chile puBllci estadísticas sn mm.¡fífiies£l

Fusnle FMI Pefspecllvss oe la Economía Mundial

f / goOwno de Chite publica esoaislicas an www.aiwss.cl

Gastos de inversión del gobierno (2011)% del PIB

Fuente: FMI. Esladlstas Os F Inanias PúblicasEl ooOiB/no Oe Cñlls puOlics estadísticas en HWW dwíto. ti

Contratación PúblicaContratación de la Administración Pública (2011)

% del gaslo público total

Fuente: FMI Estadísticas de Finanias Públicas

Disponibilidad pública de informaciónsobre contrataciones a nivel central de gobierno (2013)

Leyes y políticas

Información general para los posib

Orientación específica sobre los pn

Plan de las licitaciones anticipadas

Documentos de licitación

Criterios de selección y evaluación

Adjudicación del contrato

Justificación de la adjudicación del

Modificaciones del contrato

El seguimiento de los gastos de contratación

Disponibilidad:

^H Skmpre

I No disponible

es contratistas

)cedimientos de aplicación

contrato al contratista seleccionado

•(tratación

i_Chile

•

•

•

•

•

•

•

•

•

•

O¿En cuántos países es

esta informaciónsiempre disponible?

11

10

10

8

11

10

10

8

9

8

Fuente OCDE 3013 Encuesta sobre CnnlralaciOn Pública ,

Panorama de las Administraciones Públicas: América Latina y el Caribe 2014Innovación en la Gestión Financiera Pública

La primera edición de Panorama de las Administraciones Públicas: América Latina y el Caribe 2014, Innovación en la Gestión Financiera Pública

es una publicación conjunta entre la Organización para !a Cooperación y Desarrollo Económico (OCDE) y el Banco interamericano de Desarrollo

(BID) que ofrece un conjunto de alrededor de 30 indicadores para ayudar a las autoridades y los ciudadanos a referenciar y analizar el desempeño

gubernamental dentro de la región ALC y en comparación con el promedio de tos países miembros de la OCDE. El modelo es Panorama de las

Administraciones Públicas, de la OCDE, el cual es una referencia fundamental, respaldado por una metodología bien establecida para países

miembros del a OCDE. La publicación se enfoca en cuatro amplias categorías: finanzas públicas y economía; empleo y salarios públicos; prácticas

y procedimientos presupuestarios y contratación pública.

Para obtener más información y consultar las Fichas Factuales de otros países:www.oecd.org/gov/panorama-de-las-adminlstraciones-publlcas-lac.htm

» OECDBETTER POLICIES FOR SETTER LIVES

Government at a Glance 2013www.oecd.org/gov/govataglance.htm

Country Fací Sheet

1 out of 3 central government employees ¡n • With a Gini coefficient of 0.51, Chile hasChile isa woman, the highest level across the • the highest level of income ¡nequalíty after

OECO. • government laxes and transfers among OECDcounlries.

Chíle's general government debt represenied18.5% of GDP ¡n 2011, the lowest level

across the OECD.

Serving CitizensWomen in Government

Valúes havebeen roundedHow to read the figures:

Impact of the tax system and grants onreducing íncome inequality

Ditfetences in income inequality before and after lax andgovernment iransfers (2010)

Gini CoeMiclenl Gini Coefficient

Trust in governmentfe oi citizens who have con(idence in their national governmenl (2007 & 2012)

% Percentage poinlo 10 20 30 4o so eo 7o BO 90 ioo change 2007-2012

Public sector efficiencyEducation performance in PISA reading scores and expenditure

per studenl (aged 6 lo 15) ¡n USD PPP ¡2009)PISA Reading Score

ssoPISA

Reading

Fiscal sustamabilityTotai consolidaron requirements between 2012 and 2030 in

arder lo reduce governmenl debt to 60% oi GDP% of polential GDP

15

O SOOOO 100000 150000 200000Expendilure per studenl aged 6 to 15 (USD PPP)

Government revenues W Government expenditures Fiscal balance(2011)

% of GDP

Government debt(2011)

% of GDP

Structure of government expenditures (2011)% of total government expenditure

Fiscal rules: Types and legal foundation (2012)

i-Expenditurerule(s)

Reveñuerule(s)

Budget balancerule(s)

Debtrule(s)

Do these typesof rules exísl?

YES

NO

YES

NO

If yes, what is thelegal foundation?

Use of performance budgeting practicas|j: at the central level of government (2011) X

Index

In how many countriesdo these types of rules exist?

Legal foundatlons:

concón

11

nlernal PC PollllcalSecondary Legislando •• Rules/PoHcy Comrnitment

Employment in general government (2011)% o) labour forcé

SourCE Infernal>0nal Latour aganisation OalaOase & QECD Labour Forcé SlalishCs

Annual compensation across central government positions (2011)2011 USD PPP 2011 USD PPP

400 000

Mídale managers Sénior managers(03 positions) (D1 positions)

SOUTO: OECD ímz Surrty on Campen sal ion oí Employees in Ceñiría I VFefleial Governmenis

Share of women in general government (2010)% of general government ernployment

Share of ministers who are women (2012)% of ministers

f f f f f18.2%

• •

ff

íSoutce Inlernalional Labour Orgajiisalion So urce Inier-Paíliamentary Union Parline Calábase

Procurement expenditure (2011)% of government expenditures

Ves, ln natkmal central e-procurenient systsms ty Yes.in e-procuremen! sysrerrs otapeaficprocurlngernllies

Soura OECD 2012 Surfflyon

Open and Inclusive GovernmentAsset disclosure: Level of disclosure of prívate interests

and public availability of Information (2012)

Low level Middle levelO 10 20 30 40 50 60 70

68

High fevel90 100

Access to medical care (2011)oul of pocket expenditure as a % of final household consumption

Citizen take-up of e-government services (2012)% of individuáis using the interne! to interact with public authorities

4.6%

0% 1% 2% 3% 4% 5%7%

n«

I •*WM

So urce Eurosta arid Qt'CD

Satisfaction and confidence across public services (2012)% o( cilizens expressing confidence/satisfaction

OECD range

National government32%

Judicial system24% ;

Health care39% ; •

Local pólice63% /- .

Education system44%

Sourcs Woild Gallup Poli

Government at a Glance 2013Wilh a focus on public administration, OECD Government at a Gfance 2013 provides readers with a dashboard of key indicators assembled with the

goal of contributing to the analysis and ¡nternational comparison of public sector performance across OECD countries. Indicators on public finances

and employment are provided alongside composite indexes summarising aspects of public management policies, and indicators on service quality

¡n education, health, taxation and justice. Government at a Glance 2013 also includes indicators on key governance and public management

issues, such as slrategice governance, budgeting, compensation in the public service, public procurement and open government.

For background data and to consutt this publication on une:

http://dx.do¡.org/10.1787/gov_glance-2013-en

For more Information and to consult all other Country Fact Sheets:

www. oecd. org/gov/govataglance. htm

Education GPS AS) QECDTHE WORLD OF EDUCATION AT YOUR ^^^ f 'F1NGERTIPS BETTER POUCIES FOR SETTER LíVES

Country profileChile

The typical teacher in tower secondary education in Chile is a 41 year oíd woman, who reportshaving 15 years of teaching experience and who completed a teacher education or trainingprogramme. The proportion of female principáis is lower than the proportion of female teachers (53%and 63%, respective ly). On average, principáis in Chile are 54 years oíd and report having 11 years ofexperience in their role.

> 72% of lower secondary teachers report having undertaken professional development in the12 months prior to the survey. The áreas in which the highest proportions of teachers report a highneed for professional development are teaching students with special needs and teaching in amulticultural or multilingual setting.

• Teachers in Chile report spending 73% of their lesson time on actual teaching and learning. Thismeans that 2650 of their time is reportedly spent on administrative tasks and keeping order in theclassroom {11% and 15%, respectively). They also report spending 27 hours per week on averageteaching, 6 hours preparing lessons and 4 hours marking student work.

• More than 95% teachers report overall satisfaction with their job. However, only 34% of them believethat teaching is a valued profession in society.

HIGHLIGHTSTeachers

A smaller proportion of teachers are female than in most other TALIS countries. (62.8%) DownloadIndicatorTeachers in Chile are on avera§e younger than in most other TALIS countries.(41.3 Years) Download IndicatorOn average, teachers in Chile have spent fewer years teaching than in most other TALIS countries.(15.1 Years) Download IndicatorA smaller proportion of teachers have completed a teacher education or training programme thanin most other TALIS countries. (85.7%) Download Indicator

School leadership

Principáis in Chile are on average older than in most other TALIS countries. (53.7 Years) DownloadIndicatorOn average, principáis in Chile have spent more years in their role than in most other TALIScountries. (11.3 Years) Download IndicatorA larger proportion of principáis are satisfied with their job relative to most other TALIS countries.(97.9%) Download Indicator

DATA TABLE

Indicator

TEACHERS

Percentage of femáleteachersMean age of teachers

Average years of working experience as ateacher in total ... •• . T

Completion óf teacher education or trainingprográmmé (percentage) ^

SCHOOL LEADERSHIP

Female principáis (percentage)

Age of principéis (average)

Principáis' experience (in years)

Principáis beHevíng that the teachingprofession is valued'ín.society (percentage)

Principáis who are satisfied with their job(percentage) , :

PROFESSIONAL DEVEtÓPMENT OF TEACHERS

Teachers haying taken parí in a forma!induction prográmmé (percentage)

Teachers haviñga mentor assigned(percentage)

Teacfiérs who aré méritbrs to ánothercolleague (percentage)

Teachers who undertook professionafdeveloprnent in the íast 12 months(percentage)

Teachers who report a high level of need todevelóp their ICT skilis for teaching(percentage)

Teachers who report a high level of need todevelóp the skilis to teach students withspecial néeds (percentage)

TEACHER APPRAISAL AND FEEDBACK

Teachers who report that feedback hasfncreased the number of hours of professionaldevelopment they undértake (percentage)

1 • ^K^sP^Sfc

ítelüf(2013) Download Indicator ^W^^A. ;

(2013) Download Indicator ¿S|fj!f|Jf ?

Í2Q13) Download Indicator "j ^M^

Í2013Í Download Indicator

"iSÍ:(2013) Download Indicator | | '

f2013^ Download Indicator 'j^^^{

(2013) Download Indicator ",f$]¡|Í

(2013) Download Indicator ;W^pSf

f2013) Download Indícalor ''^jjjji^-

^ijjjji^(2013) Download Indicator JJp |;,'jí?

(201 3> Download Indicator •'^,5. ;

(2013^ Download Indicator 6.6.

(201 3^ Download Indicator 71.7

(20131 Download Indicator Í2.8

(2013) Download Indicator . 25.8

(2013) Download Indicator .69.3.

TALISaverage

68.1

42.9

16.2

89.8

49.4

51.5

8.9

44

95.6

48.6

12.8

14.2

88.4

18.9

22.3

45.8

Teachers who report that feedback hasimproved their teaching practice (percentage)

Schools that use some kind of formalappraisal (percentage)

Teachers having their classrooms directlyobserved in schools with formal appraisalpractices (percentage)

(2013) Download Indicator ' 82

f2013> Download Indicator , 95.9

(2013) Download Indicator 100

62

92.6

94.9

What is TALIS?«íiuvc'-¿(íir tótadMl A*^* ¿ L Í:.*¡¡ . -'--.'.-,-' i[. .-¡'—i ,-*¡ .£''''.-& ••-:,t:iri~ri>.;-\aj]ün6 Intemajüonaj StíQígY (IftU$) cp erts •International y .comparable data ¿on dhe

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Key features of the TALIS 2013 surveyWho? The international target population forTALIS is composed of lower secondary teachersand their school leaders in mainstream publicand prívate schools. In each country, arepresentative sample of 20 teachers and theirschool principal from 200 schools wasrandomly selected for the study. Approximately106 000 lower secondary teachers respondedto the survey, representing more than 4 millionteachers in more than 30 participatingcountries and economies.

How? A conceptual framework for TALIS wasdeveloped by subject-matter experts, theinternational research consortium and theOECD to steer the development of the TALIS¡nstruments. The framework is based on theconcept of effective teaching and learningconditions. The framework ¡s available on theTALIS website, along with all TALIS publicationsand the international datábase.

What? TALIS began in 2008 in 24 countries, focusingon lower secondary education. TALIS 2013 nowcovers more than 30 countries and economies, andalthough the mam focus remains in lower secondary,some countries opted to also survey their primaryschools (6 countries) and upper secondary schools(10 countries). Further, 8 countríes chose to gainadditional insights by surveying schools thatparticipated inthe 2012 Programmefor InternationalStudent Assessment (PISA).

Sepárate questionnaires (paper and online) forteachers and school leaders, requiring between45 and 60 minutes to complete, were used to gatherthe data. They included questions on:

• teacher characteristics• working environments• leadershíp• learning and development opportunities• appraisal and feedback• pedagógica! practicas and beliefs• self-efficacy and job sattsfaction

This work is published under the responsibility of the Secretary-General of the OECD. The opinions expressed andarguments employed herein do not necessarily reflect the official views ofOECD member countries.This document and any map included herein are without prejudice to the status ofor sovereignty over any territory, tothe delimitation of international frontiers and boundaríes and to the ñame ofony territory, city or área.

» OECDGLOBAL VALUÉ CHAINS (GVCs): CHILE

Participation in GVCsCountnes' integration in the global economy is nowadays closely linked to their participation inGVCs. One indicator measuring the participation of countries in GVCs1 shows what percentage of acountry's exports are part of GVCs: either because of upstream links - that is looking back along thevalué chain and measuring foreign inputs/value added included in a country's exports - ordownstream links - í.e. measuring the domestic inputs/value added of the country contained in theexports of other countries by looking forward along the valué chain.

Figure 1. GVC participation across countries, 2009

80%

The participation of Chile in GVCs through exports is mainly driven by downstream linksas other countries intensively use Chile's intermediates in their exports. This high degreeof forward participation is, among others, closely linked to Chile's large exports of naturalresources (Figure 1).

The mining sector shows the highest (forward) participation in GVCs due to its strongdownstream links. Manufacturing industries in Chile are less integrated in GVCs; theirGVC participation is mainly due the use of imported intermediates in Chile's exports.This is also the case for transport and telecommunications services; other servicessectors show a higher forward participation (Figure 2).

Figure 2. GVC participation by industry2, 2009

18%

Note: 1) This indicator of GVC participation focuses on intermediates which are produced in one country and then included in anothercountry's exports; it has been introduced by Koopman et al. (2011) 'Give Credit Where Credit Is Due: Tracing Valué Added inGlobal Production Chains'; see also Miroudot and De Backer (2013) 'Mapping of GVCs'. GVC participation is influenced by the sizeof the economy, stock of natural resources, distance to world markets, composition of exports (final versus intermediates), etc.

2) The indicator on the industry level ia expressed relative to total country exports (instead of industry exports) m order to take intoaccount the importance of the industry in the total expon composition of a country.

This descriptive note complementa the OECD publicación "Interconnected Economies: Benefiting from Global ValuéChains". The country-specific indicators on GVCs are based on the OECD-WTO Trade in Value-Added datábase (TiVA -fh ttp://oe. cd/ti vai .both data and indicators are accessible on stats.oecd.org. For further information on the OECD work onGVCs, please contact us ([email protected]) or visit our website thttpV/oe.cd/gvci. May 2013

Distribution of valué added along the valué chain (manufacturing and marketservices)The ability to particípate in GVCs is instrumental for economic integration, but benefiting fromGVCs depends on how much valué a country creates in GVCs. Similar to the stylised approachapplied for individual producís (e.g. Apple's iPhone), the contribution of different industries andcountries along the valué chain can be calculated at the aggregate level3. Final demand incountries (i.e. sales within the domestic market) is made up of valué added created by foreign anddomestic industries; a further distinction between direct (i.e. within the industry) and indirect (i.e.in upstream industries) domestic valué added can be made at the level of individual products.

Figure 3. Domestic and foreign valué added in final demand across countries4, 2009

100%90%80%70%60%50% -j40%30% -20% -10% -0%

Two thirds of the final demand for manufactured goods and market services in Chilerepresent valué added that has been created domestically. The foreign valué added sharewas 34% in 2009 (Figure 3),

Market services show, as expected, the largest domestic valué added, especially directdomestic valué added. Foreign valué added is more important in final demand formanufactured goods sold in Chile; the foreign valué added share is nearly 100% forelectrical and transport equipment products (Figure 4). But other manufactured goodsshow significant domestic (direct and indirect) valué added content.

Figure 4. Domestic and foreign valué added in final demand by producís5, 2009

Note: 3) Tirnmer et al. (2012) 'New Measures of European Competitiveness; A Global Valué Chain Approach' calis this measure GVC-income.

4) Only manufactured goods and market sen/ices are included given the prominence of GVCs in these industries.5) Since trade and transport margins are grouped together in the wholesale/retail sector, distribution services for final goods are not

included in the industry decompositions.

Export shares in GVCsCountries créate (and capture) valué added in domestic markets as well as foreign markets{through exports). In an era of GVCs, gross export shares are however less meaningful inmeasuring the international performance of countries. National economies increasinglyspecialise in specifíc activities (assembly, logistics, R&D, etc.) instead of entire industries withinGVCs. Because of the international dispersión of productive activities across countries and theuneven distribution of valué along the valué chain, export shares in valué added terms are moreaccurate indicators of countries' competitiveness in the global economy.

Figure 5. Export shares6 across countries, gross and valué added terms, 2009

14%1.5%

1.0% -

05% •

0,0% MiáMagnirted

0.5%

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Chile's total exports represented 0.5% of total world exports in valué added terms, whichis slightly above Chile's share in gross exports (Figure 5).

Chile's shows the highest shares both in valué added and gross exports ín the mining,agriculture, wood and paper and food industries. The differences between valué addedand gross export shares are small for these industries since exports of natural resourcesrequire less intermedíate goods in the production process. Export shares for otherindustries in Chile are much smaller and are roughly the same in valué added and grossterms (Figure 4).

Figure 6. Export shares by industry, gross and valué added terms, 2009

2.5%

Note: 6} Exports include intermedíate, capital as well as final producís, henee thís indicator provides additional insightsexport activities of countries within GVCs, complementary to the GVC participation Índex discussed above.

into the

Competitiveness in manufacturing GVCs: the role of servicesManufacturing today involves much more than the puré production of goods and increasinglyincludes service-related activities both upstream and downstream in the valué chain.Manufacturing exports include sígnificant valué added from service industries7: firmsincreasingly use logistics, communication services, business services, etc. to facilitate theefficíent functioning of GVCs. In addition, services (e.g. design, development, marketing,warranties and after-sales care) help to differentiate, customise and upgrade producís, enablingfirms to capture more valué.

Figure 7. Services valué added embodied in manufacturing exports8, across countríes, 2009

45%

• Almost one third of the valué of Chile's manufacturing exports represents services valuéadded: especiálly business services and to a lesser extent distribution services, transportand telecommunications and financial services. Services nave become slightly moreimportant in manufacturing exports between 1995 and 2009 (Figure 7).

* Exports of different manufacturing industries show a similar distribution across servicesectors; business services are the rnost prevalent category in the exports of eachmanufacturing industry (Figure 8). The services valué added content of exports hassignificantly decreased in a number of (smaller) manufacturing industries.

Figure 8. Services valué added embodied in manufacturing exports, by industry, 2009

40%

Note 7) The results only account for traded services and thus represent a lowei bound of the contribution of services to manufacturinfexports. R&D services for example are often performed in-house.

S) Distribution services for final goods are not included.

The statiütical data for Israel in all che figures in this docutnent are supplied by and under the responsibiliiy oí therelevant Israeli authorities. The use of such data by the OECD is without prejudice to the status of the Golan Heights, EastJerusalem and Israeli settlements in the West Bank under the terms of international law.

¿Cómo va la vida enChile?

OECDBetter LifeInitiative

SETTER LIFE INDEX

El índice para una Vida Mejor es una aplicación web interactiva que invita a los ciudadanos a comparar elbienestar entre los países de la OCDE y más allá, basándose en los indicadores de bienestar exploradosen el informe How's Life? Los usuarios han elegido que importancia darle a cada uno de los once temasmostrados a continuación y, por lo tanto, ver cómo los países puntúan en función de sus prioridadespersonales en la vida.

11 temas que definen el bienestar

i Vivienda

Q¿ Ingresos

Comunidad

Educación

Medio ambiente

Compromiso

Oo

Salud

Satisfacon la'

Cada flor representa un país ycada pétalo representa un tema

Seguridad

, Balancevida-trabajo

Califica los temasen función a laimportancia quetengan para ti

OL:IT

Los usuarios pueden compartir su índice con otras personas en sus redes, así como con la OCDE. Estonos permite recopilar información valiosa sobre la importancia que los usuarios otorgan a diversasdimensiones del bienestar, sobre .cómo estas preferencias difieren enjre los países, y sobre lascaracterísticas demográficas de los usuarios. f

Desde su lanzamiento en mayo 2011, el índice para una Vida Mejor ha tenido más de 3.6 millones devisitas desde prácticamente todos los países del planeta (184) y se han consultado más de ochomillones de páginas. Se han compartido con la OCDE más de 60 000 índices para una Vida Mejorcreados por los usuarios. Los siguientes resultados reflejan registros voluntarios a la OCDE a través de lapágina www.oecdbetteriifeindex.org. Los resultados sólo pueden ser considerados como indicativos y noson representativos de la población en general.

Preferencias sobre los temas de bienestar de todos losusuarios

10.32% 10.34%9.86%

Satisfacción ante la vida, Salud y Educación han sido consistentemente los temas mejor evaluados.

PERCEPCIONES PÚBLICAS DEL BIENESTAR: RESULTADOS PARA CHILE

Educación, Salud y Satisfacción ante la vida son los temas que tienen mayor importancia para fosusuarios chilenos. El siguiente gráfico compara las encuestas entregadas por usuarios en Chile, México yEstados Unidos1.

12.0%

11.0%

10.0%

9.0%

8.0%

7.0%

6.0%

Preferencias sobre los temas de bienestar de todos los usuarios enChile, México y Estados Unidos

'Ir i irTTrr i i ii i i i i i ii i i i i i i

i Estados Unidosi Méxicoi Chile

ocjr *?

J?

Chile ocupa actualmente el 21° lugar por el número de visitas al sitio del índice para una Vida Mejor (más39 900), un aumento de más de 130%, o 26 000 nuevas visitas, desde la última edición del índice en mayode 2013. Las principales ciudades son Santiago con más de 29 700 visitas, seguido por Valparaíso (+2 300)y Concepción (+2 100).

Distribución por géneroComparación entre Chile y

todos los usuarios

Chile Todos losusuarios

5%0%

Distribución por edadComparación entre Chile y todos los

usuarios

41%

3%

i Mujeres • Hombres

< 15 15-24 25-34 35-44 45-54 55-64 >65

• Chile • Global

1 Preferencias para Chile basadas en 527 encuestas de usuarios recibidas entre mayo 2011 y marzo 2014.

Para solicitudes de medios de comunicación contáctanos [email protected] o +33 1 45 24 97 00

Para mayor información contáctanos a:bli(o)oecd.ora

OECDBetter LifeInitiative

rLa Convention entrera en vigueur des quedlx Etats l'auront ratiffée. Hutt de ees

dlx ratifications dofrent émaner d'Etatsmembres du Conseil de l'Europe. I

Que pouvez-vous taire poursoutenirleRéseau?

Etes-vous une ONG, un media, un organe public, unparlementaire, un fonctionnaire ou un professionnel?Le Réseau est disposé á soutenir les activités que vousmenez pour taire du droit de vivre sans violence uneréalité pour les femmes en Europe et ailleurs. Faites-nous connaítre vos activités et savoir comment nouspouvons vous préter main forte.Le Réseau a également besoín de votre soutien: vouspouvez contribuer á améliorer nos capacites de mobi-lisation afín de promouvoir une tolérance zéro de laviolence á l'égard des femmes et de la violencedomestique et faire connaííre la Convention d'lstanbul,principal instrument mis en place á cette fin par leConseil de l'Europe.Vous pourriez;• signer et diffuser largement la pétition en faveur de

la Convention d'lstanbul;• nous teñir informes de l'évolution de la sítuation

dans votre pays;

• inviter les membres du Réseau á participen á desévénements, des débats et des activités desensibilisation;

• partager avec le Réseau des exemples de bonnespratiques;

• mieux faire connalíre notre action et la Conventiond'lstanbul.

Référence

Résolution 1861 (2012) Promouvoir la Conventiondu Conseil de l'Europe sur la prévention et la lutte contrela violence á l'égard des femmes et la violencedomestique.

Site internet / bulletin d'information /E-mail du Réseau

assem bly. coe. i nt/stopviolence/[email protected]

Contacte au Secretaria!Mme Géraldine Grenet

[email protected]él.: +33 3 90 21 49 82 - Fax: +33 3 90 21 56 52

Mme Elodie [email protected]

Tél.: + 33 3 90 21 56 34 - Fax: +33 3 90 21 56 52

Parliamentary Assem blyAssem blée pa<tementa¡re

A L'ABRIDE LA PEUR

Réseau parlementaire pour"le droit des femmes de vivresans violence"

La ptupart des cas ne sont pas sígnales.Les victimes ne bénéficient d'aucuneassistance et les auteurs des violencesrestentimpunis.Le droit de vivre sans violence devrait étre lepremier droit humain.

51 parlementaires se sont engagés á enfaire non seulement un droit, mais aussiune réalité.

Parliamentary AssemOlyAssem blée parlemen taire


COUNCII. <H IUROÍT.

••>>- ; ,' :.»í.i.:: 4Í! .'¿•i' * .. ' CÓNSUL DC l.'LUKOl'h

Issued at / distribuée á 0910SPEAKERS LIST/ LISTE DES ORATEURS

Debate: Wednesday 1 October 2014 / Débat: Mercredi 1 octobre 2014

1. The activíties of the Organisation for Economic Co-operation andDevelopment (OECD) in 2013-2014

o Statement by Mr Ángel GURBIA, Secretary General of the OECD

1. Les activités de l'Organisation de coopération et de développement économiques (OCDE)en 2013-2014

o Intervention de M. Ángel GURRÍA, Secrétaire general de I'OCDE

Speakers/Orateurs

Mr PRESCOTT

MrSASI

Mr David DAVIES

M. PASQUIER

M. ELZINGA

MrGeraint DAVIES

M. BENEYTO

Mr MIYAZAWA

Ms BLANCO

M. MENDESBOTA

Mr HEER

Mr LEE

Mr MAELEN Van der

Country/Pays

United Kingdom

Finland

United Kingdom

Monaco

Netherlands

United Kingdom

Spain

Japan

Spain

Portugal

Switzerland

Republic of Korea

Belgíum

Política) Group/Groupe politique

SOC (on behalf of group / au nom dugroupe)

EPP/CD / PPE/DC (on behalf of group/au nom du groupe}

EDG / GDE (on behalf of group / aunom du groupe)

ALÜE / ADIÉ (on behaif of group / aunom du groupe)

UEL/GUE (on behalf of group / aunom du groupe)

SOC

EPP/CD

MEM8ER OF PARLIAMENT OF AN OECDMEMBER STATE

SOC

EPP/CD

ALDE

MEMBER OF PARLIAMENT OF AN OECDMEMBER STATE

SOC

& t¿f&n>-iM

&190 /?

¿

JJ ©Jf Europedie i'Euroipe

A

LORENZINI BASSO

OCDiE

Dy

LXl] LEGISLATURA

CÁMARA ot DIPUTADOS

COMISIÓN DE RELACIONES EXTERIORES

DIP. ELOY CANTU SEGOVIAPRESIDENTE

Av. Congreso de la Unión No. 66Edif D - Planta Baja, Col. El Parque,Deleg.VenustianoCafranzaC.P.15960, México, D.F.

oficina: (55) 5036 [email protected]

Kiij qo6 opeues ue669E »3oo oe st es -iuuo

^^ aupuo 90 |3"IN -OPPILUBHt °N Buiíojay B| ap oesed -/ly

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Secretaria! of the Parliamentary Assembly

Secrétariat de l'Assemblée paríementaire

Alfred SixtoHeaü of the Jable OfficeChef du Service cíe la Séance

F-6707S Strasbourg CedexTel : + 33 (0)3 8841 2244F a x . + 33(0138841 27 17

alfred.5ixtoigicoe.inihnp://www.coe.mt

SRE Permancnl Missíon of Méxicoto the Coimtil of Europe

SANTIAGO OÑATE LABORDEPERMANENT OBSERVER8, Boulcvard du Prísidtnt Edwards67000 Strasbouig, FlaneeTel. .33 (0) 3 88 24 07 72 / -.33 (0) 3 BB 24 26 81Mob. +33 (0| 6 08 73 03 83 - Fax .33 ¡0) 3 8B 2« 10 87c-mnil: üuití«gooi?ire.gab.nu(http://www.irc.gDb .nui/e«i™burgo/ 00180 Roma

Piaz?a Motitccitofiogal a U _g@camet:i .it

Tel. 06 6892 959Fax 06 6893 172

informa sobre participaciÓn de los diputados seÑores …

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