Rijit SenguptaCUTS InternationalFIRST PAC MEETING

CREW PROJECT14th March 2013

Jaipur, India

Project Implementation Process(CREW Project)

Outline

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Introduction

About the Project

Project Phases

Management & Programmatic issues

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I. INTRODUCTION

1. Genesis of CREW Project

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Competition can promote consumer and producer/business welfare – not much doubt

Competition not an end in itself, but a means for achieving developmental goals

Presence of competition law not adequate, a comprehensive approach necessary - competition reforms

DCs suffer from implementation challenges:- Government support often meager- Limited stakeholder understanding & support- Development partners’ priorities- Etc.

2. Competition Reform Defined

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Competition reforms = A + B + C

A: Enabling government policies that promote competition in markets

B: Appropriate regulatory framework, institutions and actions for promoting competition in sectors

C: Well defined competition legislation and effective enforcement mechanisms

3. Motivation for CREW

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Some research had been done to establish the link between competition and productivity, growth and consumer welfare

Experience of competition and regulatory agencies accentuated the link between well-functioning markets and resulting welfare

Why was CUTS Interested?- Is it possible to better demonstrate positive effects of competition reforms on producers and consumers in DCs?- Is there a way to isolate the such positive effects of competition reforms, given the problem of attribution?

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II. ABOUT THE PROJEC T

1. Goal & Objectives

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GoalTo better demonstrate measurable benefits from effective competition reforms in DCs, for ensuring long-term support for competition

ObjectivesEnhance understanding of benefits from competition reforms in DCsDevelop & Test a Methodology to assess efficacy of competition reforms in benefitting consumers and producersAdvocate to key actors (National & International) for greater support to competition reforms in DCsSustain momentum on competition reforms and take it forward

2. Outputs & Outcome

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OutputsDocumented evidence of benefits from competition reforms in key marketsDialogues involving multiple stakeholders on benefits of competition reforms in DCsStrategy for capacity building of DC competition agencies and sector regulatorsFramework (Tool) guiding process of competition reforms in DCsDemand from elsewhere for similar exercise

Outcome Greater attention and impetus for competition reforms in key DC markets resulting in consumer and producer benefits

3. Implementation Plan

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4 Countries & 2 Sectors

Phase I: Identify the degree and nature of competition in the two sectors – main competition concerns (Diagnostic Report) – RESEARCH & OUTREACH/CONSULTATIONSPhase II: Develop methodology for assessing benefits of competition reforms in two sectors (Framework + Methods + Tools) – DESIGN THE FRAMEWORK (with METHODS/TOOLS) & CONSULTATIONS

Phase III: Apply sectoral FCPs in micro-locations in 4 project countries – MICRO-LEVEL TESTING, ADVOCACY & PUBLIC EDUCATION

4. CREW Project Actors

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Program LevelCREW Implementation Team: CUTS+Advisers+NathanPACCountry LevelCountry Partner OrganisationNational Reference Group (NRG)National Entities: Competition/Sectora Regulator, Business Associations, Research Organisation/CSO, Media

5. Coordination Mechanism - Actors

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NRG-2

6. CREW Actors: Information & data flow

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III. PROJECT PHASES

1. PREPARATORY ACTIVITIES:Selection of Project Countries

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Presence/absence of a national competition law, agency

Local (research and advocacy) institutions with orientation on competition and consumer protection issues

2 countries each from the regions: Africa and AsiaOne country in each region of DFID’s interestOne member state each of SADC and ASEAN CUTS experience of having implemented an

earlier competition projectCUTS confidence of implementing the activities

1. PREPARATORY ACTIVITIESSelection of Sectors

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High impact on the poorAvailability of dataEssential goods and servicesNature of sector regulatory framework

2. PHASE I Activities Diagnostic Phase

(RESEARCH & OUTREACH/CONSULTATIONS)

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Gather information about prevailing state of competition (including competition concerns) in two sectors of four project countries

Collect evidence of benefits/losses accruing to consumers and producers in the two sectors

Identify ‘enabling’ and ‘opposing’ factors for countries to derive these benefits

Collate experience from four countries for each sector - inputs for the design phase (Phase-II)

3. Programme Logic (Phase-I)

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4. Phase IIDesign Phase

[DESIGN THE FRAMEWORK (with METHODS/TOOLS) &

CONSULTATIONS]

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Draw Inputs from the Diagnostic Phase (for preparing 2 sectoral FCPs) in terms of:(a)Indicators of benefits of competition reforms for consumers and producers(b)Evolve a common methodological framework(c)Selection of applicable Methods and Tools

5. Benefits of competition reforms for Consumers (Possible

Indicators)

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• Access: Goods and services reach consumers in areas where they were not available earlier

• Quality: Quality of goods and services enhanced by firms to attract customers

• Choice: New firms/products enter otherwise ‘concentrated’ markets

• Price: Prices are reduced in a ‘contestable market’• Time savings by consumers

5. Benefits of competition reforms for Producers (Possible

Indicators)

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Access to essential services: Firms can easily

access infrastructure networks, etc.

Free movement of goods & services: Mobility

not affected by policies, practices (inputs & outputs)

Predictability of regulatory actions:

Legislations enforced by autonomous yet

accountable institutions

5. Benefits of competition reforms for Producers (Indicators)

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Cost savings: Effective implementation of strategies

to reduce costs, e.g. improved application of ICT tools

Fair market processes: Easy entry and exit in

markets; considerable ‘ease of doing business’

Level-playing field: principle of ‘competitive

neutrality’ is observed

Transparency in market: Well laid out policies and

predictable implementation processes (market

regulators)

6. How to measure benefits?

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Methods = Qualitative + Quantitative

7. Phase III: Validation Phase(MICRO-LEVEL TESTING, ADVOCACY

& PUBLIC EDUCATION)

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Research: (a) competition distorting policies & (b) impact of ACPs on producers, consumers

Parliamentary outreach and discussionsGovernment-Business ForumMedia (information) campaignTraining Workshop for CAs and Sector Regulators

- Enhance enforcement capacity (based on market studies)

- Highlight need for coordination of actions (CA + SR)

National Orientation Workshop (other sectors)- Expanding support for competition reforms- Better buy-in (other sectors)

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IV. MANAGEMENT & PROGRAMMATIC ISSUES

1. Technical oversight

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AdvisersTwo Advisers (R Shyam Khemani & Fred Jenny)Point out relevant techniques, methodsGuide in developing ToRs of reports, etc.Advise on sources of useful informationSecure useful reports, dataHelp draft and re-draft parts of reportsPlay an active role in outreachGet involved in capacity building activities

Associate Organisation (Nathan Associates) Performs Core Research functionDraft the background paperPrepare sectoral FCPs

2. Development partners

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RolePropose PAC membersGuide project implementation processParticipate in ‘internal review’Involve closely with ‘external evaluation’Stock-take project progress, periodicallyAct in coordinationEngage country-offices in project

countries/regionInvolve other donors & IGOsOther donors to join in supporting CREW

subsequently

2. Development partners

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Reporting & ManagementDonor Coordination Reporting arrangementsGAANT ChartOperational Strategy Note (OSN)

3. Project Advisory Committee (PAC)

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RolePoint sources of useful information (techniques, methods, data ) at country/sector levels Quality control of project reports, briefs, etc.Strategic advise (advocacy & outreach)Finalisation of project countries (4)Advise for choosing sectors (2)Address challenges in implementationGet involved in capacity building

3. PAC: Confirmed Members

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Fred Jenny, OECD Competition Committee (Chair)Pradeep S Mehta, CUTSDFID Representative (Miguel Laric)GIZ Representative (Eiko Kauffmann)Martha Licetti, Competition Team, World BankEberhed Feess, Frankfurt School of F&M, GermanyNatalie Timan, OFT, UKRafaelita Aldaba, PIDS, PhilippinesDeunden Nikomborirak, TDRI, ThailandDavid Ong’olo, KenyaGeorge Lipimile, COMESA Competition

CommissionYannis Katsoulacos, AUEB, Greece

3. PAC: Meetings & Engagement

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Physical meetings once a year (CREW meetings)

Special InviteesMeetings on sidelines of international

conferences (OECD GCF, UNCTAD IGE, ACF, etc.)

SKYPE meetings (bi-annual)Quarterly reports and feedbackAny other possibilities

4. Update about Preparatory Phase

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Planning Meeting (8-9 Nobember 2012, Bonn)Drafting the Operational Strategy Note (OSN)Identification of PAC membersToR of Project Adviser(s)Identification of Project Associate Organisation

(PAO)Drafting of background paper by PAO, ‘Measuring

impacts of competition reforms : suggested approaches & methods’

Inception Meeting in March 2013 (Jaipur, India)- Identification of project countries- Identification of sectors- Partners orientation

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Thank YouCUTS Team

Beginnings are always exciting!