WITH THE FINANCIAL SUPPORT OF THE EUROPEAN UNION SEE 2020 Integrated growth workshop Sarajevo, Bosnia and Herzegovina November

Programming and Prioritisation 2 SEE Ministerial Statement Annex 3 bis - Action Plan for Implementation of a SEE 2020 Strategy Integrated growth underpinned by deeper trade and investment linkages should be pursued by: i. Removing trade distortive non-tariff barriers and facilitating cross-border movement of goods in a timely fashion; ii. Undertaking concerted efforts for the liberalisation of trade in services, under the auspices of CEFTA; iii. Creating a regional strategy for investment promotion that builds on the work that has already been conducted by the regional working groups under the auspices of the Investment Compact and the SEEIC; iv. Enforcing laws and regulations to protect intellectual property; v. Supporting the work of all CEFTA bodies and structures to fulfill their respective mandates; and vi. Developing a single regional capital market;

3 Suggestions for regional initiatives

Programming and Prioritisation: suggestions for regional initiatives 4 Regional investment promotion strategy – a tailored regional strategy/approach targeting international investors in sectors or niches who could fit into Western Balkan value chains. Regional one stop shop for foreign investors – implementing a single window service for interested foreign investors prepared to invest in the Western Balkans. The OSS shop would have information on all 7 Western Balkan economies and would forward documents or requests to one of the seven IPAs A regional exhibition – a touring exhibition which would visit foreign markets and highlight a specific sector or niche area in each of the seven Western Balkan economies. Organisation of visits to Western Balkan – Western Balkan IPAs could organise joint visits of foreign investors to the region,with a stop in each economy. This would save time and money for the foreign investor. Co-location in foreign markets – Western Balkan IPAs could identify cities where they could save money and build on information synergies (e.g., the Scandinavian Tourist Board in Asia-Pacific has joint offices in Tokyo and Beijing).

5 SEE 2020 development process

6 Greater time and staff commitment Jan FebMarchAprMayJuneSeptOctNovDec 1st task force meeting SEE 2020 Strategy endorsed 2013 SEEIC 2nd task force meeting

7 SEE 2020 Monitoring – Integrated growth

IRI assessment methodology 8 Development of IP Laws

IRI assessment methodology – tripartite structure 9 Private Sector Independent experts Government self- assessment

Example: Results of Investment Policy and Promotion assessment in IRI

Example: Results of Investment Policy and Promotion assessment in IRI Main points for improvement Land title registration and cadastre is slow FDI Incentives on sub-national level need more clarity One-stop shop for investors (IPAs to approve permits) Legal frameworks for PPPs to be developed Need to improve IP rights enforcement

Which indicators should be retained, modified or removed? 12 Investment Policy and Promotion FDI Policy National Treatment Admittance of personnel Transfers ? FDI incentives ? Performance requirements Land ownership Titling, cadastre and restitution Intellectual Property Rights Expropriation ? International Investment Agreements ? International Arbitration ? Investment Promotion and Facilitation Strategy? Institutional Support? Monitoring and Evaluation FDI-SME linkages One stop shop Client Relationship Management ? Policy Advocacy ? Aftercare services Transparency Publication avenues and tools Prior notification and stakeholder consultations ? Procedural transparency Privatisation and PPPs Privatisation strategy Privatisation consultations Restrictions on foreign investor participation in privatisation PPP units PPP legislation PPP consultations PPP cost benefit analysis PPP monitoring

FDI Policy 13 National Treatment – national treatment restrictions on entry and operation of FDI Admittance of personnel – limitations on entry of specialised personnel to support FDI ? Transfers – restrictions on capital transfers in and outside of host economy ? FDI incentives – transparent application of incentives with monitoring and evaluation Performance requirements – requirements, such as local-content, on investments Land ownership – ability of investors to own land (urban and rural) Titling, cadastre and restitution – up to date cadastres and land registers, restitution process completed Intellectual Property Rights – enforcement of IP laws ? Expropriation – clear rules for expropriation and efficient legal process ? International Investment Agreements – what is contained in bilateral investment treaties ? International Arbitration – signatories to New York Convention and ICSID Convention

Investment Promotion and Facilitation 14 ? Strategy – contents of an investment promotion strategy ? Institutional Support – level of support provided by the investment promotion agency ? Monitoring and Evaluation – whether the investment promotion strategy is evaluated ? FDI-SME linkages – programmes to support commercial linkages between FDI and local firms ? One stop shop – whether investors can submit and receive approval for all administrative procedures in one place ? Client Relationship Management - the degree to which investment promotion agencies keep track and follow up with foreign investors ? Policy Advocacy - whether the investment promotion agency advocates on behalf of investors ? Aftercare services – whether investment promotion agencies provide support to foreign investors after their establishment

Transparency 15 Publication avenues and tools – whether laws and administrative procedures are codified and published ? Prior notification and stakeholder consultations - whether investors are notified in advance of changes to laws and procedures ? Procedural transparency - whether legal procedures are transparent, are their opportunities for appeals

Privatisation and Public Private Partnerships 16 ? Privatisation strategy - existence of a privatisation strategy Privatisation consultations – are stakeholders prior to a privatisation Restrictions on foreign investor participation in privatisation – restrictions on foreign investors ? PPP units – is there a unit in government to lead PPP development ? PPP legislation - is there legislation covering PPPs, not just concessions ? PPP consultations - are stakeholders consulted prior to PPP being launched ? PPP cost benefit analysis - is there an assessment of a PPP ? PPP monitoring - is the PPP monitored and evaluated?

Results of Trade Policy and Facilitation assessment in IRI

Which indicators should be retained, modified or removed? 18 Trade Policy and Facilitation Trade Policy formulation and evaluation Trade policy strategy formulation and evaluation Institutional Co-ordination Public/private consultation Monitoring and evaluation of the impact of trade measures (+ Impact of regional measures taken under CEFTA Agreement ? ) Trade liberalization WTO EU Customs duties on capital goods? Quantitative restrictions (+ Services Trade restrictiveness? ) Non-tariff barriers Technical barriers to trade Sanitary and phytosanitary measures Administrative barriers to trade (to be revised in line with CEFTA MMF indicators ) Proactive export promotion Export Promotion Agency Export promotion programmes (+ Regional export promotion strategy / programmes?)

Trade Policy formulation and evaluation 19 Trade policy formulation and evaluation sub-dimension focuses on the effectiveness of a countrys framework for formulating, implementing and evaluating trade strategy: Trade policy strategy formulation and evaluation Institutional Co-ordination - the existence of effective mechanisms for intra-governmental co-ordination as a pre- condition for effective trade policy processes. Public-private consultation – effective mechanisms for consultation with the main stakeholders in trade policy making (consultations between government representatives, and enterprise sector /civil society institutions such as trade unions and consumer, environmental and social justice groups) Monitoring and evaluation of the impact of trade measures – governments capacity to monitor and evaluate the impact of trade measures (collection and analysis of trade data in order to understand the countrys position in the world trading system and the impacts of trade policy on individual sectors) ? Evaluation of regional trade measures (new) – capacity to measure the impact of regional measures taken under CEFTA Agreement

Trade Liberalization 20 The extent of trade liberalization measured through: WTO - status of membership in the World Trade Organization EU - extent of trade integration with the European Union (Stabilization and Association Agreements - chapter on the free movement of goods) ? Customs duties on capital goods – level of duties on imports of capital goods in SEE Extent of quantitative restrictions – quantitative restrictions on imports and exports for economic reasons have been abolished in all SEE economies. Currently, only few quantitative restrictions on imports can be applied only for non-economic purposes. ? Trade in services (new) – measuring services trade restrictiveness (market entry conditions; measures for free movement of people; barriers to competition)

Non-tariff barriers 21 Elimination of non-tariff barriers (NTBs): Technical barriers to trade - Transposition of EU technical regulations and standards; Implementation of EU technical regulations and standards; Participation in European standardization; Institutional framework for accreditation; Information and notification mechanisms. Sanitary and Phytosanitary measures - Institutional framework for SPS measures; Level of co-operation among SPS agencies at the intra-CEFTA and external level; Framework SPS legislation; Transposition of European SPS measures; Information and notification mechanisms. Administrative barriers to trade – Establishment and functioning of a national customs website and enquiry points; Involvement of the trade community; Advance rulings; Appeal procedures; Fees and charges; Formalities: documents and automation; Customs procedures and processes; Domestic and cross-border/international agency co-ordination and co-operation ? Regional risk management coordination (new) – co-ordination between border agencies of SEE economies in the risk management implementation

Proactive Export Promotion 22 This sub-dimension examines the efficiency and effectiveness of a countrys institutional and operational settings for export promotion: Export promotion agency - presence and operations of an export promotion agency (Independence and autonomy of the agency; provision of both onshore and offshore services; adequate staff and funding; evaluation of results) Export promotion programmes - number and characteristics of export promotion programmes, their comprehensiveness and co-ordination, and the degree to which they remain funded by donors. ? Regional strategy for export promotion (new) – existence of regional export promotion services and programmes (regional promotional events; trade fairs, etc)

23 Thank you for your attention Milan Konopek Project Manager - Regional Competitiveness Initiative Katarina Djermanovic-Largenton Policy Analyst OECD Investment Compact for South East Europe Private Sector Development Division Organisation for Economic Co-operation and Development (OECD)