Granada, 20 May 2014

C.H. Montin, Granada, 20 May 2014 11

Granada, 20 May 2014

International Cooperation for building economic institutions

in the MENA region

Charles-Henri Montin, Smart Regulation Consultant

Former Senior Regulatory Expert,

Ministry of economy and finance, Paris

http://smartregulation.net


Approach and contents

Approach and sources (“practitioner”)– Personal participation in actions to build

capacities in the MENA and other regions– Policy making in the OECD MENA

Governance Initiative Steering Group Two parts (for discussion)

– What is “institution-building” in the governance context and what are the challenges

– International cooperation: how to make the best use of them for national results


INSTITUTIONS FOR REGULATORY REFORM

Institutions Policies Tools

Which “ institutions” are we addressing

– Drafting new or amended rules and regulations (line ministries, other regulators, parliament)

– Regulating and ensuring compliance and enforcement of rules (inspections, audit offices, judiciary)

– Oversight of regulatory processes (formulating policy, monitoring, evaluating, reporting)


The functions of regulatory institutions

“The right set of institutions and mechanisms are required to actively provide oversight of regulatory policy procedures and goals (2012 OECD recommendation n°3)”:

• Regulatory oversight bodies (OB) with whole of government responsibility

• Ministerial accountability for regulatory policy• Efficient whole-of-government coordination of policy-

making• Measureable programs such as reduction of

administrative burdens• Careful design of independent (economic) regulators


Functions of the oversight body

Oversight of the rule-making process Assisting rule-makers in their evidence-based

analysis Challenging the quality of the regulatory

proposals, notably by checking RIAs Advocating for quality regulation (better

regulation) and promoting the implementation of BR principles, including training and guidance


Options for setting up the oversight function

OB within the executive branch driving and managing regulatory reform across gvt

High-level committees for regulatory reform (leading at political level)

Advisory and/or advocacy bodies: challenge and advising on the government’s regulatory reform

Ad-hoc institutions established for specific tasks and regulatory reviews


Getting the governance context right

Dynamic process between the center and line ministries/ regulators

System of checks and balances; incentives Need for expertise in line ministries/regulators,

Division of tasks Quality control body (Conseil d’Etat or

Legislative Bureau) Balance between political discretion and need

for expertise, Timing


Institutional Design: OB within the executive

Executive

Legislative

Primary Legislation

Secondary Legislation

Regulation

Oversight Body

2. Independence & Authority3. High level political support4. Whole-of-Government5. Multidisciplinary6. Broad concept of reform

1. Centre of Government


Examples of authorities in MENA region

Bahrain: Legislative and Legal Opinion Commission, an independent (judiciary) institution (http://www.legalaffairs.gov.bh/)

Egypt 2008-2012: ERRADA http://www.errada.gov.eg/index_en.php

Tunisia: central steering committee in Présidence du gouvernement + guillotine project with specific inst. setting

Lebanon: Legislation and Consultation Department in MJ and Council of State http://www.statecouncil.gov.lb/tarikh_fr.htm

http://www.legalaffairs.gov.bh/

http://www.errada.gov.eg/index_en.php

http://www.statecouncil.gov.lb/tarikh_fr.htm


Success factors

OB located close to core executive functions Credibility of the core unit builds on technical

expertise and political support Transparency and accountability, Checks and

balances, limited opt-out exemptions and time limits

Networked approaches: a core body, with suitable powers, coordinates a network of units in ministries.

Stability of the structures: gradual or big bang approaches; quick-wins and real outcomes


Recommendations for MENA region

Design a central institutional mechanism within government aimed at enhancing the quality and efficiency of government policy and programmes.

Build and strengthen co-ordination mechanisms inside and outside the administration to foster coherence across policy objectives and to clarify the responsibilities of the various actors in the regulatory system.

Develop a policy for the continuous awareness raising and training of regulators.


New trends (2014)

growing demand from MENA countries for comprehensive country projects based on an overall country strategy

core governance reforms to strengthen accountability, transparency and public service delivery, leading to greater trust in government

focus on public service delivery: – Better use of ICT, – stronger civil society engagement and

consultation processes to incorporate youth in the decision-making

– territorial development to address regional disparities


Building institutional capacities in MENA region

Audits, reviews (ex OECD regional review) Bilateral and multilateral projects such as

improvement of business regulations (Tunisia) or creating BR units, for capacity building

Regional dialogue and tools:– Charter for regulatory quality; publications– Training centres

Thematic conferences example legislative drafting in Morocco funded by EuroMed.


MULTI-FACETED INTERNATIONAL COOPERATION

Multiple actors– Bilateral or Multilateral– International or intergovernmental– G8/Deauville, Open Government Partnership– OECD MENA Initiative, EuroMed (Partnership

for Democracy and Shared Prosperity) Different approaches

– strategic commitment/delivery– Political or economic priority (governance or

investment)– Different procedures and requirements


Opportunities and challenges

After the Arab Spring Job creation is the top priority Emigration is expected to rise as a result of the

Arab Spring. Fighting corruption and strengthening the rule of

law are essential for economic growth and development.

A bloated public sector has distorted labour markets and crowded out the private sector

Entrepreneurship is very low in most MENA countries.

(source: O’Sullivan, Rey & Galvez Mendez)

http://www.oecd.org/mena/investment/49036903.pdf


EU Partnership for Democracy and Shared Prosperity

3 “key pillars:”– democratic transformation and institution-building,

fundamental freedoms, constitutional reforms, reform of the judiciary and the fight against corruption

– a stronger partnership with the people, support to civil society and on enhanced opportunities for people-to-people contacts with a particular focus on the young

– sustainable and inclusive growth and economic development especially support to SMEs, vocational and educational training, improving health and education systems and development of the poorer regions (from COM(2011) 200 final) 8 March 2011

Known as EUROMED, instrument of the Union for the Mediterranean, f.k.a. Barcelona process. Managed by European External Action Service


EU Neighbourhood Instrument (2014) targets

(1) Promoting human rights , freedoms, the rule of law, equality, sustainable democracy, good governance and democracy,

(2) Achieving progressive integration into the EU internal market (3) Creating conditions for well managed mobility of people and

promotion of people-to-people contacts; (4) Encouraging development, poverty reduction, internal

economic, social and territorial cohesion, rural development; (5) Promoting confidence building, security and the prevention

and settlement of conflicts; (6) Enhancing sub-regional, regional and Neighbourhood wide

collaboration as well as Cross-Border Cooperation;

Implemented by EuropeAid. €11.2 bn 2014-2020


The Deauville Partnership (DP)

G8 May 2011 political process to support (3 pillars)

– (governance) the democratic transition and foster governance reforms (accountability, participation)

– (finance) Job creation for sustainable and inclusive growth

– (trade) Regional economic integration (ALECA) 12 donor countries (200m $ pledged) DP created MENA Transition Fund 4 thematic areas

– Investing in Sustainable Growth. – Inclusive Development and Job Creation. – Enhancing Economic Governance. – Competitiveness and Integration

https://www.menatransitionfund.org/content/overview


Deauville Partners

G8 + International Organisations (see below) 5 Partners: SAU, UAE, KOW, QA, TUR 6 beneficiaries: MA, TU, LI, EG, JO, YE


Open Government Partnership

Launched by US in Sept 2011 to promote values:– Accountability– Technology and Innovation– Citizen participation– Transparency

Members undertake to work with civil society to develop and implement an OGP action plan, report on progress and participate in the independent reporting mechanism

See OGP Guiding Principles for Government Self-Assessment Reports

http://www.opengovpartnership.org/sites/default/files/attachments/Final%20Government%20Self%20Assessment%20Guidelines_0_0.pdf

http://www.opengovpartnership.org/sites/default/files/attachments/Final%20Government%20Self%20Assessment%20Guidelines_0_0.pdf


MENA-OECD: a solid platform for reform

PARTNERS– Anna Lindh

Foundation– ARADO– CAWTAR, – EC– IMF– UfM– UNDP– WB

REGIONAL NETWORKS (Governance)– Integrity and Anti-

Corruption– Open government and

innovation– Senior Budget Officials– Public Service

Delivery, PPP and regulatory reform

– Gender Focus Group– Territorial

Development Focus Group

Two ProgrammesGovernanceInvestment


Multi-disciplinary programme of work

Support to SME, within the Deauville Partnership Administrative simplification Public Procurement PPP: regulatory framework, inst. capacities Gender: see 2013 OECD-CAWTAR report on

gender, law and public policy: includes chapter on effective institutions and policy-making

Regulatory Reform: see 2013 report on RR in MENA: lists present achievements, challenges and good practices, recommends new tools and institutional development


The OECD Governance Programme


Delivery: example OECD MENA

G8 Deauville Partnership Open Governance and Anti-corruption Action Plan: OECD lead organisation

Dissemination of open government principles and practices to promote innovative government

Assistance to accession to Open Government Partnership Combination of regional support and country specific projects:

– Access to international policy instruments– Capacity building activities– Assistance to implementation– Policy dialogue among peers– Tailored policy analyses and recommendations


Examples of OECD supported country projects

Tunisia– Has becomes OGP member in Jan 2014– Reinforcing budget transparency (GE support)– integrity and accountability

Morocco– OG policies: law on access to information– Integrity and part.: support to Médiateur and

ICPC Palestinian Authority

– Support since 2009 leading to institution building and technical documents

UAE, Jordan, Yemen, Libya


Other notable achievements of OECD

Training activities– Training Centre of Caserta: capacity building

in procurement, ICT, regulatory policy, administrative simplification

– Partnership with IMF Middle East Centre for Economics and Finance

Evidence-based regional policy dialogue– OGP meeting in London Nov 2013– Regulatory Reform in MENA report– Gender, law and public policy report


Issues for national officials

Are there any additional frameworks and mechanisms for better institution building, which you would like to discuss?

How could the OECD and other international organizations be made more efficient in support of individual Arab countries reform plans?

How could the mechanisms be better focused on economic institutional development?

What practical difficulties do you know of concerning interacting with international donors?


To continue the study…

Two text-books– OECD: Strengthening the institutional setting for regulatory

reform– World Bank: Institutions for regulatory governance

Further questions contact:• montin @ smartregulation.net

File and URL of this presentationhttp://www.montin.com/documents/granada2014.ppt

http://www.oecd-ilibrary.org/governance/strengthening-the-institutional-setting-for-regulatory-reform_5kgglrpvcpth-en







https://www.wbginvestmentclimate.org/uploads/BuildingStrengtheningInsitutions.pdf

Granada, 20 May 2014

Documents

regulatory policyefficient

regulatory reviews

regulatory proposals

regulatory oversight

economic institutions

mena regionbahrain

oversight functionob

oversight bodyoversight