APEC Investment ReformAPEC Investment Reform

Paul Kennelly

APEC’s Investment Experts Group (IEG)

APEC Energy and Investment Roundtable 30 September – 2 October 2008, Cairns

1.1. IntroductionIntroduction

Market CharacteristicsMarket Characteristics

Demand & Supply: ‘The China Syndrome’

Global Growth

Volatility: Extreme events (weather, stock market, geopolitical tensions, etc.)

Transparency → Predictability

The Prime Reform Challenge –Policy Certainty

APEC’s Reform FrameworksAPEC’s Reform Frameworks

Trade Facilitation Action Plan (TFAP): Significance for IFAP as a successful model

Investment Facilitation Action Plan (IFAP): More later . . .

Leaders Agreement on Implementing Structural Reform (LAISR):

More later . . .

2.2. Behind-the-border Barriers Behind-the-border Barriers

Nature & ImplicationsNature & Implications

Nature of behind-the-border barriers

Implications of such barriers

3.3. APEC’s Investment Facilitation APEC’s Investment Facilitation Action Plan (IFAP) Action Plan (IFAP)

and the LAISRand the LAISR

IFAP, 2008-10IFAP, 2008-10

Raison d’être

Definition of ‘investment facilitation’

Methodologies for measuring reform progress

Capacity Building

LAISR, 2008-?LAISR, 2008-?

Objective

Definition of ‘investment facilitation’

Methodologies

Capacity Building

4.4. Reform IngredientsReform Ingredientsto make Action Plans workto make Action Plans work

Maximising reformist sentimentMaximising reformist sentiment

Self assessment

Coordination

Ownership

Identification of priorities

Ownership (Policy Desirability)Ownership (Policy Desirability)

1. Identify / develop ‘reform champions’.

Ownership (Policy Desirability)Ownership (Policy Desirability)

2. External drivers of reform are less-than-ideal as they tend not to ‘stick’.

3. Reform must be pursued from within (government, business, individuals).

4. Expert external assistance can prove crucial.

Self-assessmentSelf-assessment

Local experts:

Know their economy

Contribute to a sense of ownership

Essential for long-term success– “Give a man a fish, and he eats for a day. Teach a man

to fish and he has food for life.”

Identification of prioritiesIdentification of priorities

Identify policies likely to deliver greatest benefit & least cost/market distortions:Map the economic impacts of barriers; and

Prioritise for the short-term and long-term

Expand the ‘sweet spot’, i.e. have: policy desirability,

political feasibility, and

administrative feasibility

Complement relevant work in progress

CoordinationCoordination

By working together, agencies:

Increase ownership

Maximise efficiency and effects

Bring a ‘whole of government’ perspective

and the result is a quality outcome

Thank you