Making reforms happen in a dynamic region - OECD brochureweb.pdf · D.OECD EURASIA COMPETITIVENESS PROGRAMME THE ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT The OECD is

OECD EURASIA COMPETITIVENESS

Making reforms happenin a dynamic region

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D . OECD EURASIA COMPETITIVENESS PROGRAMME

THE ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT

The OECD is a unique forum where governments work together to address theeconomic, social and environmental challenges of globalisation. TheOrganisation provides a setting where governments can compare policyexperiences, seek answers to common problems, identify good practice andwork to co-ordinate domestic and international policies. www.oecd.org

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OECD EURASIA COMPETITIVENESS PROGRAMME . 1

CONTENTS

EURASIA: THE REGION AT A GLANCE 2

THE OECD EURASIA COMPETITIVENESS PROGRAMME 4

BOOSTING COUNTRY AND REGIONAL COMPETITIVENESS 6

CAPTURING MORE AND BETTER INVESTMENT 8

FOSTERING SME DEVELOPMENT 10

KEY PUBLICATIONS 12

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2 . OECD EURASIA COMPETITIVENESS PROGRAMME

EURASIAThe region at a glance...

Population

Countries in Eurasia havegreat potential. To achieve it,

they need to better leverage theircomparative advantages, includingtheir geographic location, theirabundance of natural resources, anda hard-working and young labourforce. They can count on theOECD to make the best out of these strengths.

Angel Gurría, OECD Secretary-General

Eastern Europe and South CaucasusArmeniaAzerbaijanBelarusGeorgiaRepublic of MoldovaUkraine

Central AsiaAfghanistanKazakhstanKyrgyz RepublicMongoliaTajikistanTurkmenistanUzbekistan



Estimated energyreserves Share of the world’s

agricultural landOil

Gas

Literacy rateNot including Afghanistan

Average growth since 2007



Leveraging OECD instruments and fosteringdialogue with the private sector, the OECDEurasia Competitiveness Programme works withcountries of the region to help unleash theireconomic and employment potential.

The Programme supports governments in three key areas:

l BOOSTING COUNTRY AND REGIONAL COMPETITIVENESS, a key driver of economic growth;

l CAPTURING MORE AND BETTER INVESTMENT, an important source of finance, know-how and technology transfer;

l FOSTERING SME DEVELOPMENT, to generate employment and raise living standards.

Key principles

l INCLUSIVENESS: The Programme brings together stakeholders from different ministries, agencies, the private sectorand the OECD to design and implement policy reforms.

l OWNERSHIP: Analyses incorporate country perspectives through government self-assessments and private sectorsurveys, which shape final recommendations.

l DIALOGUE: The OECD Eurasia Competitiveness Roundtable provides a platform for peer review, knowledge sharingand monitoring of reform implementation among countries from the region.

EVIDENCE-BASEDPOLICY ANALYSISl Policy assessmentsl Sector analysisl Application of OECD

instruments

A three-step approach

STRATEGIES ANDROADMAPSl Sector

competitivenessstrategies

l SME strategiesl Policy handbooks

OECD EURASIA COMPETITIVENESS

ROUNDTABLEl

Peer reviewl

Knowledge sharingl

Monitoring of implementation

SUPPORT INIMPLEMENTATIONl Policy seminarsl Capacity buildingl Targeted advice





BOOSTING COUNTRY AND REGIONALCOMPETITIVENESS

The OECD Eurasia Competitiveness Programme helps countriesof the region improve their competitiveness by addressingcritical policy challenges, including skills gaps, limited financingfor SMEs and over-reliance on natural resources and agriculturalcommodities.

To achieve this goal, the programme develops SectorCompetitiveness Strategies (SCS) which serve as roadmaps forimproving the business climate in specific sectors of theeconomy.

Although labourproductivity in Eurasiadoubled over the lastdecade, it is still only35% of the OECDaverage.

Advice on implementation and capacity

building

Monitoring and impact evaluation

Pilot sector analysis and identification of

policy barriers

Prioritisation of pilot sectors

Formulation and prioritisation of

recommendations

Five Steps of a Sector Competitiveness Strategy

Ongoing projects in:l Kazakhstan l Kyrgyz Republic

l Tajikistan l Ukraine


Today we face anambitious and

challenging task –to carry out the rightreforms. I am convincedthat implementation of the OECD project“Ukraine SCS” willsupport Ukraine toreach new levels ofgrowth.Iryna Akimova,Representative of thePresident at the Cabinet of Ministers


PROJECT SNAPSHOT

UKRAINE SECTOR COMPETITIVENESS STRATEGY

Ukraine’s competitiveness remains constrained by policy barriers to thedevelopment of high-potential sectors. Obstacles include:

l Limited financing for SMEs and skills mismatch in agribusiness.

l Burdensome investment framework in renewable energies.

l Corporate governance challenges in the civilian aircraft industry.

The OECD Sector Competitiveness Handbooks for Ukraine provide detailedroadmaps to help policy makers remove these policy barriers and improve thecompetitiveness of each of these sectors. They provide step-by-step guidance on:

l Establishing a credit guarantee scheme for agribusiness SMEs to furtherdevelop risk-sharing mechanisms in the sector.

l Fostering public-private partnerships in education in the agribusinesssector and revamping the internship system in agricultural universities.

l Attracting investment to the renewable energy sector by creating acomprehensive renewable energy strategy, simplifying permittingprocedures and providing firms with better access to the electricity market.

l Modernising the corporate governance of Antonov, a state-owned enterpriseleading Ukraine’s aircraft sector.



CAPTURING MORE AND BETTER INVESTMENT

The amount of FDI to the Eurasia region has been increasingsteadily since 2000. However, at the same time, inflows areprimarily directed towards the extractive industries and theregion’s share of global FDI stock remains low, at 1%.

The OECD Eurasia Competitiveness Programme advisesgovernments on how to reform their investment climates based on the OECD Policy Framework for Investment.

0.0

0.3%

0.2%

%

Share in world GDP (%)

Share in world FDI (%)

0.5% 0.6%

1.1%

1.6%

1.1%

2.5%

0.5

1.0

1.5

2.0

2.5

3.0

2000 2002 2004 2006 2008 2010 2012

Eurasia’s share in world FDI is growing quickly, but its share inworld GDP is lagging behind

Ongoing projects on:l Afghanistanl Kazakhstan l Kyrgyz Republicl Mongolia

l Tajikistanl Turkmenistanl Uzbekistan

In only a decade, theshare of global FDIinflows to Eurasiacountries increased morethan 12 times.


PROJECT SNAPSHOT

KAZAKHSTAN REGIONAL COMPETITIVENESS PROJECT

The Kazakhstan Regional Competitiveness Project aims to help improve theinvestment climate and support economic diversification in three pilot regions:Atyrau, Kyzylorda and East Kazakhstan.

To identify policy barriers hampering the development of key non-extractiveindustries, the OECD has worked with sub-national administrations in Kazakhstanto develop Regional Investment Promotion Strategies. These strategies containpolicy recommendations to help attract further investment to the agribusiness,chemical and construction materials, and wood processing sectors.

In addition, the OECD has supported the establishment of business linkageprogrammes connecting foreign investors with local SMEs to build supply-chains, transfer know-how and create jobs.

East Kazakhstan

Atyrau

Kyzylorda

Our joint projectwith the OECD

aims to improve thecompetitiveness andinvestmentattractiveness ofKazakhstan’s regions.Its ultimate goal is tocreate sustainable jobsand fosterentrepreneurshipthroughout thecountry. Yerbol Orynbayev, Deputy Prime Minister of the Republic of Kazakhstan




FOSTERING SME DEVELOPMENT

SMEs in Eurasia are an important source of job creation andincome. However, their development is hampered byburdensome regulations, excessive administrative proceduresand limited financing. SMEs also have few channels to maketheir voice heard at the government level.

The OECD Eurasia Competitiveness Programme works closelywith governments of the region and the private sector to identifyroadblocks to SME development, and propose reforms that willcreate a more conducive business environment.

0

10

20

30

40

50

60

70

80

90

100

0

Eurasia countries

Sh

are

of

SM

Es

in t

ota

l GD

P (

%)

Share of SMEs in employment (%)

OECD countries

20 40 60 80 100

SME contribution to GDP and employment in Eurasia and OECD countries

Ongoing projects on:l Armenial Azerbaijanl Belarus

l Georgial Republic of Moldoval Ukraine

Note: Averages are based on the national statistical data and definitions of SMEs in therespective countries.

SMEs in the Eurasiaregion account for almost99% of all enterprises,yet only provide about30% of value added and40% of employment, onaverage.


PROJECT SNAPSHOT

THE 2012 SME POLICY INDEX FOR EASTERNPARTNER COUNTRIESBuilt on a set of almost 100 policy indicators, the SME Policy Index provides aunique framework to assess national SME policies against ten principles of theSmall Business Act for Europe.

Over 2011-2012, the OECD Eurasia Competitiveness Programme together with theEuropean Commission, the European Training Foundation and the European Bankfor Reconstruction and Development assessed the SME policy environment in sixEastern Partner countries: Armenia, Azerbaijan, Belarus, Georgia, Republic ofMoldova and Ukraine. This analysis resulted in a list of priority actions for reform:

l Improved co-ordination between government agencies;

l Development of targeted SME policy tools;

l Closer consultation between governments and the private sector to ensurethat reforms take market needs into consideration;

l Collection of better data for better policies.

SMEs are thebackbone of the

Moldovan economy. The work with theOECD has helped us todevelop and implementcomprehensiveSME policyreforms.Valeriu Lazãr, Deputy Prime Minister andMinister of Economy, Republic of Moldova

1

3

2

4

5

Armenia

Best Practice Level

Azerbaijan Belarus Georgia Republicof Moldova

Ukraine

SME Policy Index2013: Dimension 3

– RegulatoryFramework for SME

Policy Making (1-weakest,

5-strongest)

Note: Dimension 3 assessesthe institutional framework,

legislative simplification andregulatory impact analysis

and inclusiveness of public-private institutions.




Central Asia Competitiveness Outlook, 2011

Central Asia Policy Handbooks, 2013:l Developing Skills in Central Asia through better Vocational Education and

Training Systems;

l Promoting Investment and Job Creation in Central Asia through BusinessLinkage Programmes;

l Improving Access to Finance for SMEs through Credit Guarantee Schemes

Sector Competitiveness Strategy for Kazakhstan, OECD 2011

Policy Handbooks for Kazakhstan, 2012:l Promoting Investment in Kazakhstan’s Agribusiness Value Chain;

l Improving Access to Finance in Kazakhstan’s Agribusiness Sector;

l Enhancing Skills through Public-Private Partnerships in Kazakhstan’sInformation Technology Sector

Investment Policy Review of Kazakhstan, 2011

Review of Agricultural Policies: Kazakhstan, 2013

Eastern Europe and South Caucasus Competitiveness Outlook, 2011

SME Policy Index: Eastern Partner Countries 2012, EU, ETF, EBRD and OECD2012

Sector Competitiveness Strategy for Ukraine, OECD 2012

Policy Handbooks for Ukraine, 2012:l Attracting Investment in Renewable Energy in Ukraine;

l Implementing Credit Guarantee Schemes in Ukraine: The Case ofAgribusiness;

l Enhancing Skills through Public-Private Partnerships in Education inUkraine;

l A Corporate Governance Assessment of Ukraine’s State -Owned AviationSector: The Case of Antonov

Investment Policy Review for Ukraine, 2011

OECDKEY PUBLICATIONS


KEY CONTACT:Mr Antonio SommaHead of [email protected]


www.oecd.org/daf/psd/eurasia

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Documents

Making reforms happen in a dynamic region - OECD brochureweb.pdf · D.OECD EURASIA COMPETITIVENESS PROGRAMME THE ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT The OECD is