News brief Europe paying a heavy price for chronic diseases Better public health policies and more effective health care could save hundreds of thousands of lives and billions of euros each year in Europe. The premature deaths of 550,000 working age people across EU countries from chronic diseases, including heart attacks, strokes, diabetes and cancer, cost EU economies €115 billion or 0.8% of GDP annually, according to a new joint OECD-European Commission report. While earlier diagnosis and better treatments have substantially increased the share of people surviving these diseases, many countries lag behind in terms of cancer survival rates. The burden of ill-health on social beneﬁt expenditures is huge, with 1.7% of GDP spent on disability and paid sick leave each year on average in EU countries, more than what is spent on unemployment beneﬁts.
We’re heading for a trade war and we’ll all lose. Daniel Finkelstein, The Times, 30 November
It is time to change the political discourse on globalisation: trade is a good thing, but fair and sustainable development also demands public services, infrastructure, health and education systems. Thomas Piketty, The Guardian, 16 November
Like it or not, globalisation is here to stay. Headline, Les Echos (French daily newspaper), 28 October
For globalisation to be politically sustainable, it must be more economically equitable. Javier Solano and Strobe Talbott, The New York Times (international edition), 20 October
Automation and globalisation are combining to generate a world with a surfeit of labour and too little work. Ryan Avent, The Guardian, 9 October
Trade isn’t an end in itself, but a tool for better jobs, increased prosperity and reduced global poverty. Christine Lagarde, Jim Yong Kim and Roberto Azevêdo, The Wall Street Journal, 6 October
Tax policy reforms
Use ﬁscal policy against low-growth trap “The global economy has the prospect of modestly higher growth, after ﬁve years of disappointingly weak outcomes,” OECD Secretary-General Angel Gurría said while launching the latest OECD Economic Outlook. “In light of the current context of low interest rates, policy makers have a unique window of opportunity to make more active use of ﬁscal levers to boost growth and reduce inequality without compromising debt levels. We urge them
to do so,” Mr Gurría said. The Economic Outlook projects that well targeted public spending initiatives could catalyse private economic activity and help to get the global economy out of the low-growth trap. Growth in the US is projected at 2.3% in 2017 and 3% in 2018, for the euro area at 1.6% and 1.7%, and in Japan, at 1% and 0.8%.
While ﬁscal consolidation was the key driver of tax reforms in the aftermath of the global economic crisis, the main emphasis of recent tax reforms has shifted back to measures aimed at boosting economic growth. Austria, Belgium, Greece, Japan, the Netherlands, Norway and Spain were the countries that implemented, legislated or announced the most comprehensive tax reforms in 2015, according to Tax Policy Reforms in the OECD. The report highlights a move in some countries towards higher taxes on personal capital income, but only relatively limited moves toward reform of environmental and property taxes.
See our Outlook section, pages 38-51.
OECD-area inﬂation rose to 1.2% in September 2016, compared with 0.9% in the previous month. Excluding food and energy, annual inﬂation was stable at 1.8% in September, for the third consecutive month.
unemployed, 9.5 million less than at the peak recorded in January 2013, but still 6.8 million more than in April 2008, when the crisis started affecting the labour market. The unemployment rate in the euro area was at 10% in September, with the largest falls observed in France, Ireland and Belgium, but increased in the US by 0.1 percentage point to 5%, while falling by 0.1 percentage point
Economy Real GDP growth in the OECD area picked up markedly to 0.6% in the third quarter of 2016, compared with 0.3% in the previous quarter. Growth accelerated in most G7 economies, with the exception of the UK and Germany, where growth slowed to 0.5% and 0.2%, compared with 0.7% and 0.4% in the previous quarter. In the EU and in the euro area, growth was stable at 0.4% and 0.3%.
The unemployment rate in the OECD area, at 6.3% in September, has been stable since May 2016. Across the OECD area, 39.5 million people were