regional economic integration of laos into asean, … is a german federal enterprise.\爀吀栀攀...

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Regional Economic Integration of Laos into ASEAN, Trade and

Entrepreneurship Development

Aid for Trade Seminar Singapore, April 22nd 2016

Shameer Khanal RELATED Project

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• Owned by the Federal Republic of Germany •A company under private law •Supports the objectives of the German Government

Our profile A German federal enterprise

Presenter

Presentation Notes

GIZ is a German federal enterprise. The sole shareholder of GIZ is the Federal Republic of Germany, which is represented by the Federal Ministry for Economic Cooperation and Development (BMZ) and the Federal Ministry of Finance (BMF). GIZ is organised as a private-sector entity and can be contracted directly. The Management Board, the Shareholder and the Supervisory Board are the three organs required under German law for a GmbH (roughly equivalent to a limited liability company). The Chair of GIZ’s Management Board is Tanja Gönner. GIZ has a four-strong Management Board, with Tanja Gönner, Christoph Beier (Vice-Chair of the Management Board), Hans-Joachim Preuß and Cornelia Richter. GIZ supports the German Government in achieving its objectives in the field of international cooperation for sustainable development. To put it another way: GIZ is a federal enterprise which supports change – for Germany – around the world. ��

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Facts and figures: business

• Operations in Germany and over 130 countries around the world

• Business volume of over EUR 2.03 billion in 2014

• Main commissioning party: the German Federal Ministry for Economic

Cooperation and Development (BMZ), whose share of the total income from

public-benefit business exceeded EUR 1.6 billion in 2014

• Income from BMZ commissions included EUR 181 million of cofinancing from

third-party donors

• Commissioned by well over 300 public and private-sector bodies in Germany

and abroad

Presenter

Presentation Notes

Facts and figures (I)�(as at 31.12.2014) GIZ has operations around the globe – throughout Germany and in other industrialised countries, emerging economies, developing nations and fragile states. In 2014 our business volume topped 2.03 billion euros. The German Federal Ministry for Economic Cooperation and Development (BMZ) provides the lion’s share of our work. Income from this business, as part of our public-benefit operations, exceeded 1.6 billion euros. Income from BMZ commissions included some 181 million euros of cofinancing from donors such as the European Union and the development agencies of Australia and the Netherlands, AusAID and DFID. Our commissioning parties come from both the public and private sectors. We are contracted by governments of other countries, the European Commission, the United Nations and the World Bank, as well as by private foundations and international companies. We cooperate intensively with the private sector and help ensure the effective interplay of development and foreign trade activities.

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Facts and figures: human resources

• 16,410 employees worldwide

• Over 3,000 staff in Germany

• 11,260 national personnel

• 785 development advisors

• 527 integrated experts and 473 returning experts

Presenter

Presentation Notes

Facts and figures (III)�(as at 31.12.2014) As at 31 December 2014 GIZ employed a total workforce of 16,410. Of these, 3,072 were employed in Germany and 2,078 were seconded experts. As in the previous year almost 70% of the workforce, a total of 11.,260 individuals, were national personnel working in partner countries. They are recruited and given employment contracts locally. As at 31 December 2014, a total of 785 development workers were on GIZ assignments. (This figure corresponds to 832 development workers carrying out assignments directly with partners, including 103 experts from the Civil Peace Service, and 37 other development workers.) At the end of 2013, 527 integrated experts were employed directly by organisations and private businesses in partner countries. 473 people were working as returning experts. They receive support from CIM in the form of financial assistance or advisory and other services. CIM – the Centre for International Migration and Development – is a joint operation of GIZ and the German Federal Employment Agency which places experts with local employers.

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Facts and figures: human resources

• Percentage of women in the workforce as a whole: 55.1 %

• Percentage of management posts held by women: 36.7 %

• More than 190 different flexible working time and

organisation models

Presenter

Presentation Notes

Facts and figures (IV)�(as at 31.12.2014) As at 31 December 2014 women accounted for 55.1 % of the overall workforce. Women hold 36.7 % of managerial posts at GIZ – more than one third. To help our staff achieve a good work-life balance, GIZ offers more than 190 different flexible working time and organisation models.

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GIZ around the globe

Presenter

Presentation Notes

Red dot: GIZ sharing country office with other German development cooperation organisations Grey dot: GIZ office

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Today, development takes place in a

globalised world.

Economic activity

transcends national borders.

Regions are ideal gateways for

connecting to the world market.

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Regional economic integration: Potentials and challenges

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Potentials Challenges

• Tightness of domestic market is overcome

• Loss of tariff revenues

• Trade with perishable goods enabled

• Decrease of wages because of immigration

• Integration into regional value chains improved

• Emigration of skilled workers

• Access to sea ports (to inter-national markets) improved

• Domestic firms are pushed out of the market by more competitive foreign enterprises

• Attractiveness (of the whole region) for foreign investments improved

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Elements for economic integration processes to be effective

Three essential elements of regional economic integration processes in order to be effective

(1) Regional agreements • Harmonization of regulations • Reduction of barriers • Planning of cross-border infrastructure projects

(2) Implementation of regional agreements on the national level • Adoption of national laws and regulations • Application of procedures in amended laws and regulations • Realisation of infrastructure projects

(3) Actors (mainly of the private sector) make use of the improved framework for more trade, investments and employment

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Different Elements of the Implementation of Regional Economic Integration

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Regional Agreement

Identification of necessary

amendments in national regulations

and procedures

„Translation“ of regional agreements

into national regulations

(amendments of laws)

Implementing Decree

Application of amended regulations

by national administration

Use of (harmonisied, simplified)

regulations and procedures by

entrepreneurs and consumers

Effects on Trade and Investment

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Elements for economic integration processes to be effective All three elements have to come together for regional economic integration processes to be effective:

Existing Element (s) Missing Element (s) Impact

There are regional agreements (1)

These agreements are not implemented on the national level (2)

No intended welfare effects for the population of the Member State in question

In individual Member States unilateral or bilateral reforms are implemented (2)

Since regional agreements are missing (1), there are no or incoherent reforms in other Member States

The welfare effects are limited; in addition, there is a risk of distortions in competition between Member States

Regional agreements (1) are implemented on the national level (2)

The private sector is not informed about them, is not capable to apply the new procedures or does not produce competitive goods and services (3)

The positive welfare effects among the population of the Member State in question are limited; rather economic risks of economic integration

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Different Stakeholders interact in regional economic integration processes : Regional Economic

Communities (ASEAN Sec.) National Governments Private Sector (and Civil Society)

• Promote and facilitate the process to elaborate and approve regional agreements (technical support, moderation of complex negotiation processes)

• Coordinate the regional economic integration process on the national level

• Should also contribute to the elaboration (content) of regional agreements

• Can increase the probability to implement regional agreements on the national level (in time involvement of relevant stake-holders, elaboration of model laws)

• Contribute decisively to the elaboration of regional agreements

• Can to some extent play a role in the implementation of measures on the national level (e.g. infrastructure projects)

• Are responsible for the “translation” of regional agreements into national laws and regulations as well as their application

• Have in particular the role to make use of the improved framework created by the regional economic integration process for more trade and inv.

Elements for economic integration processes to be effective

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Implementation Gap and reasons behind it

A large number of regional agreements are not implemented on the national level Why is there an implementation gap?

1. Missing information and awareness about the content of regional agreements

2. Political Economy

• Regional economic integration processes regularly create winners and losers

• National politicians are more interested in their own re-election than in the welfare of the entire region

• If losers are not compensated by the gains of the winners, are well organized and politically well connected, they may slow down the implementation of reforms.

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• Winners and losers among Member States • Member States are heterogeneous – economic structures differ • For the same reform measure, some Member States might win, others might lose

• Winners and losers within one Member State • Producers of the good in question • Producers of complementary or of substitute goods • Consumers • Trade forwarders • Government • Customs officers Different stakeholders are affected differently by regional economic integration processes

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Why is there an implementation gap? (continued)

3. Lack of organizational and technical capacities to implement regional agreements

• Government and National Assembly: to translate regional agreements into national laws and regulations

• Public administration: to apply the amended laws and regulations

• Private sector: to apply the improved framework conditions

4. Lack of ownership of relevant stakeholders on the national level

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Steps towards an improved implementation 1. Improve information of and awareness about regional agreements

2. Improve ownership of stakeholders involved

3. Make regional agreements beneficial for the economy

• Analysis of special characteristics of the economy

• Elaboration / presentation of national positions in regional negotiations

4. Analysis of political economy

• Who gains, who loses from a reform process?

• Who has which influence on political decision making processes?

5. Strengthening capacities of relevant stakeholders to implement regional agreements on the national level

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RELATED – Objective and Activity Areas

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A

ctiv

ity A

reas

Improve the public framework conditions for the AEC

Improve the Steering, Coordination, Communication, Monitoring of AEC Integration

Trade in Goods (mainly via Trade Development Facility II)

Trade in Services

Trade-related investments (Special Economic Zones,

Economic Corridors)

Strengthen Lao Private Sector to make full use of the AEC

ASEAN-related general support

ASEAN-related sector-specific support

(coffee, tourism, transport, logistics)

• Lao PDR is enabled to increasingly make use of the potentials and reduce the economic risks of the ASEAN Economic Community

Obj

ectiv

e

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RELATED – Achievements

Stocktaking on Lao AEC-commitments and their implementation

Training Program on Enhancing Lao Capacities on Trade and Investment Policies and Negotiations (together with UNESCAP)

Training Courses and Handbook on the ASEAN Economic Community (in particular trade in goods, trade in services and investments)

Preparation of Lao Commitments under the 10th AFAS Negotiation Round

Manual and Reader for ASEAN Trade in Services

Alignment of Lao regulations and procedures to ASEAN commitments for example in the Tourism Sector, the Transport and Logistics Sector

Support to Lao Law and Lao Strategy 2030 on Special Economic Zones (as Lao gateways into regional value chains)

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RELATED – Achievements (continued)

Baseline assessment on AEC awareness -> Tailor-made information material

Establishment of ASEAN SME Service Center / ASEAN Helpdesk (ongoing)

ASEAN App

Roadshows about the Preparation of the Lao Business Sector for the AEC in Lao Provinces

Training and seminar on the integration of Laos into regional value chains

Studies and PPD on impact of AEC on the tourism, transport and logistics sector

Trainings on Total Quality Management in coffee and tourism sector

Support to exhibitions, road shows of Lao coffee and tourism sector in ASEAN

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RELATED – Summary RELATED is the only AEC-specific project of the Lao-German

Development Cooperation as well as of all Development Partners in Laos

Due to its focus, RELATED is well connected and knowledgeable about the ASEAN economic integration process

RELATED is the only project of GIZ on a worldwide scale to support regional economic integration exclusively from national perspective

National level is where the implementation of regional agreements takes place and where private sector enterprises increase trade and investments

2016 very important year for Lao integration into AEC (establishment of AEC 2015, Lao ASEAN Chairmanship in 2016) -> High international attention

RELATED supports Lao ASEAN Chairmanship in 2016

ASEAN economic integration process not finished in 2015 (ASEAN Economic Blueprint 2025)

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Thank you

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Questions

regional economic integration of laos into asean, … is a german federal enterprise.\爀吀栀攀...

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