services work in africa 30 march 2012 lusaka. pillar i - analytical work: - epas and services -...
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Professional services knowledge platform Challenge: integrating markets (expanding trade) while achieving regulatory objectives efficiently
Filling information gaps
• Business surveys - Users and providers of professional services (more than 2200 firms)
• Self-assessment and diagnostic:• Regulatory frameworks - Regulatory surveys,
Professional associations • Trade policy analysis – World Bank surveys, Ministries of
Trade and Ministries of EAC in East Africa• Cost and procedures to obtain professional qualifications –
Interviews with students and professionals
Example users - Professional services matter
• Higher labor productivity (sales/employees) is associated with greater usage of professional services in all East African countries, especially for small firms
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
Figure 1.5 Productivity of Users vs. Productivity of Non-Users of professional services in East Africa
Productivity of Users and of Non-Users of Professional Services – Average across firms in East Africa
Example providers - Potential for regional services trade is significant
• Availability of professionals varies across countries and sectors
91
48
14
8
3
2
1
0.9
0 20 40 60 80 100
Mauritius
South Africa
Kenya
Tanzania
Malawi
Uganda
Zambia
Rwanda
Panel A: Number of Accountants per 100,000 inhabitants
46
39
19
12
6
5
4
2
2
2
0 20 40 60 80 100
Mauritius
South Africa
Kenya
Botswana
Zambia
Rwanda
Uganda
Mozambique
Tanzania
Malawi
Panel B: Number of Lawyers per 100,000 inhabitants
Example regulation - accounting services
Entry Regulation Conduct Regulation
Example education – costs of access to professional education in East Africa
• Median costs are unaffordable for most due to liquidity constraints/ absence of loans even if internal rates of return and skill premia are
high
Profession Years Total Costs (USD)Uganda
Lawyer (low/high avg.) 5 16,505Accountant (low/high avg.) 6 20,506Engineer (low/high avg.) 4 14,705
TanzaniaLawyer 6 13,438Accountant (low/high avg.) 6 24,161Engineer 10 10,779
RwandaLawyer 10 27,992Accountant 8 12,786Engineer (low/high avg.) 6 17,514
KenyaLawyer (low/high avg.) 6 14,096Accountant (low/high avg.) 5 11,918Engineer (low/high avg.) 4 11,793
Addressing knowledge gaps
• Information on trade and regulatory experiences, RIAs, good practices• OECD principles on key market-oriented and trade-and-investment-
friendly regulation • APEC-OECD Integrated Checklist on Regulatory Reform• EU Single Market • ASEAN Mutual Recognition Arrangement frameworks on accountancy
and engineering services• Progress to date with professional services reform in Africa;
remaining obstacles• Formal/informal networking and information exchanges between
national, regional and international stakeholders • Professional associations & coalitions of services industries,
negotiators & regulators, consumers, international organizations, etc.• North-South and South-South networks
Example – Coalition of professional services sectors in East Africa
• Program initiated by the East African Business Council (EABC), supported by TradeMark East Africa (TMEA), to develop a platform where business membership organizations and the private sector engage with each other and leading regional public authorities on issues that relate to the regional integration of the professionals services sector
• First meeting in February 2012 to develop strategy and establish milestones and deliverables
• Partnership with the World Bank’s Professional Services Knowledge Platform for COMESA
Addressing political economy constraints
• Costs and opportunities generated by professional services reforms• What are the economic opportunities generated by reform and
regional integration and the cost of maintaining the status quo?• Factors that explain the uneven progress with professional services
reforms in the COMESA region• Why were some sectors reformed earlier and more deeply than
others? • What triggered regulatory changes in reforming countries? What
explains the more rapid progress in certain sub regions in Sub-Saharan Africa?
• How can we advance the Tripartite process? How can we build on progress in the more advanced subset of countries?
• Lessons from other countries/regions• What can we learn from the experience of countries and regions
that have successfully engaged in reform and cooperation? Where did opposition and support come from?
Example – legal workshop in Nairobi, February 2012
• Objectives: • prepare the ground for COMESA to put in place a policy relating to
free movement of lawyers, • generate policy ideas from within the legal sector, • provide decision makers with necessary background information,
and • obtain and gather wider support for change within the legal
profession• What policy options are there for obtaining freer movement? –
Harmonisation; mutual recognition; other models (e.g. limited licensing and joint venture arrangements)
• Who would object to a profession led movement for freer movement of lawyers? What would be their objections? What would persuade them otherwise? (e.g. what people? What evidence? What potential or actual benefits?)
• What can participants do to engage others/create momentum behind the idea of a regional licence for legal practitioners?
How will the knowledge platform work?
• Mechanism that brings together regulatory expertise, trade policy makers, the private sectors, think tanks, universities and regional bodies
• Analytical work and advisory services disseminated through:– Online platform with transparent, easily searchable
databases, and social networks; www.pskp.afr– Face-to-face and virtual interactions between
practitioners, policymakers, think tanks, regional secretariats
Thank you!Nora Dihel
Africa Region - Poverty Reduction and Economic Management Unit
www.worldbank.org/afr/trade