The previous decade we could see many people got lost in the economical circus. They went onto the horror or witch tour bumping into many surprises; making many to panic.
G20 leaders presented in Saint Petersburg the report, “Advancing National Strategies for Financial Education”, jointly published by Russia’s G20 Presidency and the OECD.
The report monitors progress by the governments of the world’s major economies in implementing national strategies for improving financial education. Nobody can deny that a lot of people are not enough aware of economics. Research shows that financial literacy is in general low among consumers. A recent survey in France revealed 8 out of every 10 people questioned feel lost in relation to financial investments. In the Netherlands, 72% of respondents knew nothing about pension schemes.
The governments should take their responsibility for taking care that the present situation of a generally poor understanding of financial issues would be turned over. Because the present situation can not only impact an individual’s well-being but also affect the long-term stability of the economy.
Concern about the problem has risen in the wake of the financial crisis also because of the growing sophistication of financial products, improved access to banking products in emerging-market economies and the shrinking of welfare benefits in developed countries.
Of the 21 countries covered in the report, nine are implementing a national strategy for financial education along the lines of the principles developed by the OECD and its International Network on Financial Education. The principles were endorsed by G20 leaders in 2012. A further seven countries are well advanced in the design of a strategy.
The report includes contributions by twenty one G20 member economies and invited countries (Argentina, Australia, Brazil, Canada, People’s Republic of China, France, India, Indonesia, Italy, Japan, Korea, Mexico, the Netherlands, the Russian Federation, Saudi Arabia, Singapore, South Africa, Spain, Turkey, the United Kingdom, United States) as well as the European Union.
Almost all national strategies include a programme of financial education in schools as well as the creation of interactive websites for the public. The strategies are generally supported by a mix of public and private resources. Russia, for instance, has earmarked more than 100 million US$ to a 5-year financial literacy project.
Already in 2012 G20 leaders declared that they recognized the need for women and youth to gain access to financial services and financial education. Then they also asked the GPFI, the OECD/INFE, and the World Bank to identify barriers they may face and call for a progress report to be delivered by this Summit.
We look forward to see how the OECD International Network on Financial Education (INFE) comprises institutions from more than 100 countries to develop policy analysis and guidance on key relevant financial education issues and managed to get information closer to the public.
The OECD/INFE is committed to supporting women’s financial empowerment and the related G20 agenda by providing policy evidence, analysis, and guidance to help policy makers address women’s needs for financial awareness and education.
Presenting the report with Russian Finance Minister Anton Siluanov in Saint Petersburg, OECD Secretary-General Angel Gurría said: “It’s all about people. Our Citizens should be at the centre of financial reform. The progress made by an increasing number of countries towards a national strategy for financial education is encouraging. But we need to step up our efforts to ensure that people have the necessary understanding of financial matters to make informed decisions.”
Mr Siluanov said: “We believe this publication is an important step forward which can help us to achieve better financial stability, inclusive development and individual and households’ wellbeing. We commend the OECD for this work and think that the G20 should continue to play an important role to further enhance financial education globally.”
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The prescriptions the OECD has given for a full recovery worldwide look very like those of the International Monetary Fund (IMF). Government reforms must be put in place to improve employment and prevent another financial meltdown. The benefits of austerity were never present. Economic stimulus is a much more likely path to recovery. Put another way, politicians will decide the improvement of global GDP more than bankers or businesses.
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More than one student commented on practices they observed their parents using, such as non-bank check cashing services; they could now educate their parents on other options available at a fraction of the cost.
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