Definition of the OECD
What is the OECD? It stands for the Organisation for Economic Co-operation and Development. First, it is an organisation. More precisely, it is an inter-governmental organisation in which representatives from 36 member countries and the European Union participate.
It is also a global organisation, but not universal one like the United Nations (UN), the International Monetary Fund (IMF), or the World Bank Group (WB), because it has a limited number of member countries. Nonetheless, it is global, working with more than 120 countries. As an organisation committed to raising living standards globally, the OECD’s members are neither all wealthy nor all European. It has members on almost every continent, such as Australia in Oceania, Chile in South America, Estonia in Europe, Korea and Turkey in Asia, and Mexico in North America. It continues to increase its global influence by enlarging and engaging with non-member countries, particularly with the five “Key Partners” (Brazil, China, India, Indonesia, and South Africa). Currently, four countries (Colombia, Costa Rica, Latvia, and Lithuania) are in the accession process. The accession process for Russia was suspended in March 2014, owing to the political situation with Ukraine.
Secondly, the OECD is an organisation promoting economic co-operation by pursuing “better policies for better lives,” by sharing knowledge through peer reviews, publishing various publications, setting and raising standards, and making policy recommendations.
The currently 36 member countries account for about 60% of the world’s GDP, two-thirds of world trade, and 95% of official development assistance (ODA). With an annual budget of 363 million euros, some 3,000 staff, 250 committees, and more than 100,000 delegates, it produces over 250 publications per year.
So, do these figures indicate that the member countries are all wealthy? Not necessarily. In terms of per capita GDP (as of 2017), Korea is ranked 23rd out of 36. What, then, are the criteria to become a member of the OECD? The organisation has not adopted official accession criteria. In 2004, however, a working group chaired by Japanese Ambassador Seiichiro Noboru issued a report on the OECD’s enlargement and outreach strategy, laying out such accession criteria as like-mindedness, significant players, and mutual benefits. Many members see these criteria as still relevant for selecting future accession countries.
The first criterion, "like-mindedness," means that member countries should broadly share values such as a market-based economy and democratic principles. In more practical terms, in order to become a member of the OECD, a country should pledge to adhere to most of the OECD legal instruments, such as decisions and recommendations that are considered as best practices or high standards based on a market economy and democracy.
That is why the OECD is no longer a club of rich countries. Rather, it is a house of best practices