Fias 2018 ANNUAL REVIEW THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES With support from: ©2019 The World Bank Group 1818 H Street NW Washington, DC 20433 Telephone: 202-473-1000 Internet: www.worldbank.org All rights reserved. This volume is a product of the staff of the World Bank Group. The World Bank Group refers to the member institutions of the World Bank Group: The World Bank (International Bank for Reconstruction and Development); International Finance Corporation (IFC); and Multilateral Investment Guarantee Agency (MIGA), which are separate and distinct legal entities each organized under its respective Articles of Agreement. We encourage use for educational and non-commercial purposes. The findings, interpretations, and conclusions expressed in this volume do not necessarily reflect the views of the Directors or Executive Directors of the respective institutions of the World Bank Group or the governments they represent. 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About the Facility for Investment Climate Advisory Services (FIAS) Through the FIAS program, the World Bank Group and donor partners facilitate investment climate reforms in developing countries to foster open, productive, and competitive markets and to unlock sustainable private investments in sectors that contribute to growth and poverty reduction. The FIAS program is managed by the Equitable Growth, Finance & Institutions Practice Group of the World Bank Group. For more information, visit www.worldbank.org/fias. Acknowledgments This report was written by the staff of the World Bank Group and edited by John Diamond. Design Partner: Corporate Visions, Inc. Printing: District Creative Printing Cover photo: Kanchipuram, India. Woman weaving silk sari on loom. Bigstock Photography FIAS 2018 Annual Review 3 contents Message from the Vice President 5 Introduction 6 01 Main Achievements and Milestones 8 02 Special Topic: Strong FIAS Results in OHADA 18 03 Operational Highlights 24 Pillar 1: Improve the Business Environment 28 Pillar 2: Expand Market Opportunities 36 Pillar 3: Increase Firm-Level Competitiveness 52 04 FIAS-Supported Work in Programmatic Themes 58 05 Financial Results and Resource Use 64 06 Annexes 70 Annex 1: FIAS Reform Totals and Descriptions 70 Annex 2: Portfolio of FIAS-Funded Projects in FY18 77 Annex 3: Key FY18 Publications, Events 80 Annex 4: Abbreviations 85 FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 4 The FIAS partnership could not be more important than it is today, as we aim to generate more investment to underpin sustainable job creation and resilient economies in our partner countries. FIAS 2018 Annual Review 5 Message The FIAS partnership could not be more important than it is today, as we aim to generate more investment to underpin sustainable job creation and resilient from the economies in our partner countries. FIAS complements and accelerates our IDA 18 objectives and the IFC 3.0 strategy to achieve the twin goals of ending extreme Vice President poverty and boosting shared prosperity. During fiscal year 2018, the second year of the FY17–21 FIAS strategy cycle, we worked on 98 projects in 86 developing countries: 52 of them are IDA countries; 45 are in Sub-Saharan Africa; and 25 are in fragile and conflict-affected situations, reflecting strong commitment to FIAS priorities. Our partner countries have implemented 102 reforms in the first two years of the cycle. Half of the top 10 reforming countries in Doing Business 2019 achieved their ease-of-doing-business reforms with FIAS support. The strong results in the OHADA nations of Sub-Saharan Africa, subject of this year’s Special Topic chapter, reflect our emphasis on supporting investment climate reform in a coordinated fashion across multiple countries. An independent evaluation of the project reports significant increases in domestic credit availability and cost savings to businesses. This multi-country approach has leveraged results for FIAS also in East Africa, the Caribbean, Central America, the Western Balkans, and Central Asia. And FIAS support for programs that expand opportunities for women have strengthened global and regional projects supported by the Women Entrepreneurs Financing Initiative. In this year’s Annual Review, look for the “FIAS Leverage” tag on feature boxes throughout the report where we describe how FIAS-supported work dovetails with other World Bank Group lending, investment, and advisory initiatives. The core mission of FIAS remains unchanged: to help client countries institute and implement reforms that foster open, productive, and competitive markets and unlock sustainable private investments in sectors that contribute to equitable growth and poverty reduction. Within this well-established partnership, now in its fourth decade, FIAS enables the World Bank Group to be more agile, flexible, and responsive to partner country demands, while increasing our overall effectiveness in reducing poverty. With the work of the FY17–21 strategy cycle now well under way, I am pleased to present the FIAS 2018 Annual Review, providing data on reforms and expenditures as well as narratives of the work being done by our country and global teams, and I send heartfelt thanks to our FIAS donors and partners for continuing their strong support for the FY17–21 work program. Ceyla Pazarbasioglu Vice President Equitable Growth, Finance & Institutions FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 6 The work supported by the Facility for Investment Climate Advisory Services (FIAS) is taking place in increasingly challenging circumstances across emerging and developing economies. Rising public debt, political uncertainty, trade work supported by FIAS and carried out by tensions, and lower-than-expected growth EFI’s joint World Bank-IFC teams in more in the major economies are combining than 80 developing countries all the more to flatten the growth curve of developing relevant and timely. FIAS is supporting work countries that have experienced a decade in all six World Bank group regions, with of economic expansion since the global an emphasis on borrowing countries of economic crisis of 2008. Global Economic the International Development Association Prospects—Darkening Skies, published in (IDA), Sub-Saharan African countries, and January 2019 by the World Bank Group, fragile and conflict-affected situations (FCS). projects 2.9 percent growth in 2019, a The FIAS 2018 Annual Review details 40 downward revision of its previous forecast investment climate reforms achieved in 25 stemming from softening international trade client countries, nearly two-thirds of them and manufacturing, elevated trade tensions, IDA members. Ninety-three percent of Introduction and financial market pressures facing large FIAS-supported projects received positive emerging markets. ratings from clients. And five of the ten countries listed in Doing Business 2019 as Growth is expected to continue but at a most improved—Afghanistan, Azerbaijan, slower pace in Sub-Saharan Africa, a priority India, Togo, and Rwanda—recorded reforms region for FIAS. In 2018 economic activity in FY18 from FIAS-supported projects. in non-resource-intensive countries in The Special Topic chapter in the FY18 Africa was robust, supported by agricultural report focuses on strong results achieved production and services, household in the 17 Sub-Saharan African countries consumption, and public investment. Several of OHADA, where more than a decade of countries in the West African Economic FIAS-supported advisory work has led to and Monetary Union grew at 6 percent the passage and implementation of reforms or more, including Benin, Burkina Faso, that have substantially improved business Côte d’Ivoire, and Senegal—all of them formation and access to finance across a beneficiaries of FIAS-supported projects. large swath of central and western Africa. Regional growth is expected to increase to 3.4 percent in 2019 on the strength of These are but a few highlights of the past improved investment in large economies year’s activity. New in this report is reporting and continued growth in non-resource- under the tag line FIAS Leverage, describing intensive countries. On the downside, per examples from across the developing world capita growth is forecast to remain well of how FIAS-supported projects align with below the long-term average in many other interventions by the World Bank Group countries, yielding little progress in poverty in client countries. The work continues in reduction—the overarching mission of the FY19, the third year of the five-year FIAS Bank Group. strategy cycle, thanks to the continued strong support of our Development Partners. These circumstances make the advisory FIAS 2018 Annual Review 7 Summit meeting in Berlin on the Compact with Africa, October 2018. Photo: World Bank New in this report is reporting under the tag line FIAS Leverage, describing examples from across the developing world of how FIAS-supported projects align with other interventions by the World Bank Group in client countries. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 8 01 FIAS is supporting implementation of reforms in more fragile states than ever. Main Achievements FIAS-supported programs contributed to 40 reforms in 25 client countries in FY18; 65% in IDA FIAS-supported projects achieved 93% client and Milestones satisfaction rating FY17–18 38 of 41 projects receiving positive ratings from clients FIAS-supported projects generated $28 million in direct compliance cost savings in FY18 due to streamlined regulation and lower business costs FIAS 2018 Annual Review 9 Vegetable stand owner carries her daughter on her back at an open market in Bamako, Mali. Photo: Bigstock FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES The New Strategy Cycle 10 Highlights of FY18 FIAS-Supported Operations 01 FIAS-supported programs contributed to 40 investment climate reforms in 25 client countries. Combined with the 62 reforms in FIAS two-year strategy cycle target is 110 reforms. FY17, FIAS is on track with 102 reforms achieved in the first two years of the strategy Reforms Achieved cycle against a two-year target of 110 reforms. { { reforms 102 FIAS-supported projects generated $33 million in new investments in FY18 based Investments in FIAS-supported projects on validations completed to date in Albania, Bosnia and Herzegovina, and FY18 the Kyrgyz Republic, bringing the total for the strategy cycle to $186 million. Investments { { million $33 FIAS support generated $28 million in compliance cost savings (CCS) in FY18, FY18 compliance cost savings reflecting lower business costs due to streamlined regulations and permitting Savings processes, bringing the total for the FY17–18 CCS strategy cycle to $36.7 million. { { million $36.7 FIAS 2018 Annual Review 11 DOING 5 FIAS clients BUSINESS 2019 Training for Reform 'most improved' in DB19 Five of the ten countries listed in Doing Business 2019 as most improved, Afghanistan, Azerbaijan, India, Togo and Rwanda, recorded reforms in FY18 from FIAS-supported projects. TRADING ACROSS BORDERS 32 reforms 32 of the 40 FIAS reforms in FY18, or 80 percent, involve Doing Business indicator reforms that have been independently validated by Doing Business. 10 percent of Doing Business 2019 DB reforms via FIAS Of the 314 DB reforms recorded in FY18 by the World Bank Group, 10 percent were achieved in FIAS-supported projects. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES FY18 Portfolio Information 12 Focus on Priority Client Groups 01 FIAS expenditures in priority areas were in line with the FIAS FY17–21 strategy targets: 68 percent supported IDA borrowing countries (target: 70 percent). FY18 Project Expenditures • 47 percent was spent in Sub-Saharan Africa (target: 50 percent) million { • 30 percent was spent in FCS (target: 25 percent). { $16.5 65 percent of reforms were achieved in IDA countries (58 percent in FY17). 65% 30 percent of reforms were achieved in Sub-Saharan Africa (32 percent in FY17). Reforms Achieved in FY18 30% 25 percent of reforms were achieved in FCS (21 percent in FY17). 25% FIAS 2018 Annual Review 13 FIAS-supported projects 25 countries FIAS supported projects in 25 of the world’s 36 FCS states or territories in FY18, or 69 percent (23 of 40 countries, or 58 percent, in FY17). The 25 are: Afghanistan, Burundi, Central African Republic, Chad, the Comoros, the Democratic Republic of Congo, the Republic of Congo, Côte d’Ivoire, The Gambia, Guinea-Bissau, Haiti, Iraq, Kosovo, Lebanon, Liberia, Mali, Mozambique, Myanmar, Sierra Leone, Somalia, Sudan, Togo, Yemen, Zimbabwe, and the West Bank and Gaza. KOSOVO 98 projects The FIAS portfolio consisted of 98 projects in FY18 (99 in FY17), with 79 client-facing (79 in FY17) and 19 non-client-facing in product development (20 in FY17). • FIAS clients rated 10 projects in FY18, all positively (28 of 31 rated positively in FY17, 90 percent), for a two-year cumulative client satisfaction rating of 93 percent for 41 projects. • In FY17–18, five of eight completed projects supported by FIAS received positive development effectiveness ratings in internal World Bank Group management reviews. Three projects in FY18 received negative ratings. A major earthquake and political instability FIAS Program Continues Under interrupted project progress in Nepal; decisions Restructured Global Practices by client governments in Egypt and the East African Community prevented completion of The Equitable Growth, Finance and Institutions (EFI) project objectives. All three of these projects vice presidency comprises four Global Practices that reported achievement of some key objectives. work to promote stable, equitable, efficient, and dynamic • Total FIAS direct project expenditures in FY18 markets, institutions and economies. These four Global Practices are: Finance, Competitiveness and Innovation were $21.5 million ($26 million in FY17), with $16.5 million, or 77 percent, client-facing (72 (FCI); Macroeconomics, Trade and Investment (MTI); percent in FY17) and 23 percent non-client Governance; and Poverty. FCI and MTI, consisting of facing (28 percent in FY17). both World Bank and IFC teams, jointly implement the FIAS-supported portfolio with EFI providing unified management. The work supports the IFC 3.0 objectives of maximizing finance for development and creating markets. EFI will continue to support foundational reforms that help to “de-risk” countries along the macro, business climate, and financing dimensions. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 14 01 The charts below show FIAS FY17 and FY18 results in priority areas as measured against FY17–21 strategy cycle targets. TOTAL FIAS-SUPPORTED REFORMS SHARE OF REFORMS IN IDA COUNTRIES 100 80 80 70% 65% 62 60 55 60 58% 40 40 40 20 20 0 0 FY17—21 FY17 FY18 FY17—21 Cycle FY17 FY18 Yearly Target Target Strategy Cycle Metrics SHARE OF REFORMS IN SUB-SAHARAN SHARE OF REFORMS IN FRAGILE AND AFRICA CONFLICT-AFFECTED SITUATIONS 100 80 80 60 60 50% 40 40 25% 32% 30% 25% 21% 20 20 0 0 FY17—21 Cycle FY17 FY18 FY17—21 FY17 FY18 Target Cycle Target FY17 Portfolio Information FIAS-SUPPORTED PROJECTS, REFORMS IN FCS RESULTS BY PRIORITY CLIENT GROUP, FY18 100 40 40 80 36 70% 68% 34 65% 30 60 50% 47% 23 25 20 21 20 40 30% 30% 13 25% 25% 10 10 20 FIAS 0 0 FY12—16 FY17 FY18 IDA-eligible Sub-Saharan Fragile and Cycle Average countries Africa conflict-affected situations n Total FCS Countries n % client-facing project expenditures: target n FCS Countries with Active FIAS Projects n % client-facing project expenditures: actual n Number of Reforms n % total reforms FIAS 2018 Annual Review 15 CLIENT FACING EXPENDITURES BY PRODUCT, FY18 100% = $16,530,313 n Business Environment (26%) n Investment Policy and Promotion (22%) n Agribusiness (20%) n Other (14%) n Indicator Based Reform (9%) n Manufacturing (4%) n Services (3%) n Competition Policy (2%) CLIENT-FACING EXPENDITURES BY REGION, FY18 100% = $16,530,313 n Sub-Saharan Africa (47%) n Middle East and North Africa (21%) n Europe and Central Asia (14%) n Latin America and Caribbean (7%) n East Asia and Pacific (7%) n World (3%) n South Asia (2%) FIAS CLIENT SATISFACTION, FY12–FY18 (Share of positive client responses from FIAS support projects) 100% 100% 95% 95% 92% 89% 90% 90% 85% 80% 70% 60% 50% 40% 30% 20% 10% 0% FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY12–FY16 cycle average (92%) Bakehouse in Johannesburg, South Africa. Photo: Bigstock FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 16 01  IAS Funding and Expenditures FY12–16 and FY17–18 F 2012-16 2017 2018 In US$, Share In US$, Share In US$, Share Contributions (Sources of Funds) a Thousands of Total Thousands of Total Thousands of Total WORLD BANK GROUP CONTRIBUTIONS 51,336,475  28% 9,599,341 26% 8,061,770 25% Core Contributions 37,788,000 20% 7,000,000 19% 7,000,000 22% IFCa 23,388,000 13% 5,000,000 13% 5,000,000 16% MIGA 5,600,000 3% - 0% - 0% World Bank 8,800,000 5% 2,000,000 5% 2,000,000 6% Project Specific/Other Contributions (IFC) 13,548,475 7% 2,599,341 7% 1,061,770 3% Donor Contributions 134,480,300 72% 27,950,198 74% 23,557,629 75% Core 47,516,000 25% 4,601,820 12% 5,620,842 18% Programmatic 55,913,000 30% 16,009,590 43% 8,880,887 28% Project-Specific 31,051,300 17% 7,338,788 20% 9,055,900 29% Client Contributions 699,000 0.4% - 0.0% - 0.0% Total Contributions 186,515,775 100% 37,549,539 100% 31,619,399 100% Less Trust Fund Administration Fees 7,151,000 1,099,899 834,799 Total Net Contributions 179,364,775 36,449,640 30,784,600 Expenditures (Uses of Funds)b Staff Costs 80,745,922 50% 15,724,142 48% 14,114,087 52% Consultants and Temporaries 41,145,014 26% 10,503,071 32% 8,768,926 32% Operational Travel Costs 26,315,588 16% 5,053,184 15% 3,006,936 11% Indirect Costs (including office and operating costs) 11,886,379 7% 1,604,318 5% 1,506,396 5% Total Expenditures 160,092,902 100% 32,884,715 100% 27,396,345 100% Includes contributions from all sources of funds that support the FIAS FY17–21 strategic agenda. FIAS FY12–16 a funding cycle contributions (previously reported) have been adjusted for comparative purposes. Includes expenditures from all sources of funds that support the FIAS FY17–21 strategic agenda. FIAS FY12–16 b funding cycle expenditures (previously reported) have been adjusted for comparative purposes. FIAS 2018 Annual Review 17 FIAS-Supported Reforms by Region and Country, FY18  Investment Policy - Entry Protection and Retention Licenses and Permits Resolving Insolvency Construction Permits Tax Simplification and Enforcing Contracts Starting a Business Protecting Minority Investment Policy - Property Transfers Investment Policy - Investment Policy - Getting Electricity Trade Logistics Getting Credit Agribusiness Inspections Grand Total Compliance Incentives Promotion Investors Region Country AFRICA Guineaa 1* 1* 1* 3 Mali a, b 1* 1 Mozambiquea, b 1** 1 Rwanda a 1 1 1** 1* 4 Togoa, b 1* 1 South Africa 1* 1* 2 AFRICA TOTAL 2 1 1 1 1 1 1 1 3 12 EAST ASIA AND PACIFIC Myanmara, b 1 1 EAST ASIA AND PACIFIC TOTAL 1 1 EUROPE AND CENTRAL ASIA Albania 1* 1 Azerbaijan 1* 1* 1* 3 Bosnia and 1 1 Herzegovina Croatia 1* 1 Kazakhstan 1* 1* 2 Kosovoa, b 1* 1 Kyrgyz Republica 1* 1* 2 Uzbekistana 1* 1* 2 EUROPE AND CENTRAL ASIA TOTAL 2 3 1 2 3 1 1 13 LATIN AMERICA AND Central 1 1 CARIBBEAN Americaa Colombia 1 1 LATIN AMERICA AND CARIBBEAN TOTAL 1 1 2 MIDDLE EAST AND NORTH Jordan 1 1 2 AFRICA MIDDLE EAST AND NORTH AFRICA TOTAL 1 1 2 SOUTH ASIA Afghanistan a, b 1* 1* 1* 1* 1* 5 India 1* 1* 1* 1* 1* 5 SOUTH ASIA TOTAL 1 2 1 1 2 2 1 10 GRAND TOTAL 1 5 4 3 1 1 1 1 2 1 1 3 5 1 6 2 2 40 FIAS Total of which in IDA 26 65% FIAS Total of which in FCS 10 25% FIAS Total of which in SSA 12 30% Reforms captured by Doing Business 32 80% International Development Association (IDA). a b Fragile or conflict-affected situations. * Of the 40 reforms validated by Doing Business, 30 were validated by DB19. ** 2 reforms were reported retroactivley and were validated by DB18. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 18 02 $3.8 billion in additional domestic credit in seven OHADA countries between 2011 and 20151 $385 Strong FIAS Results in increased Special Topic: domestic credit generated for every dollar spent on FIAS-supported projects $7.8 million in OHADA in business cost savings in six OHADA countries, 2015 through late June 2017— against a target of $7 million 1 ECOPA and Economisiti Associati, independent evaluators, An Impact Assessment of OHADA Reforms: Uniform Acts on Commercial, Company, Secured Transactions, and Insolvency, an impact evaluation of IFC’s OHADA Investment Climate Program 2007–2017, (co-publication of the World Bank, IFC, and the East African Community Secretariat, 2018), p 11. FIAS 2018 Annual Review 19 Throughout its 33-year history, FIAS has sought out opportunities to support advisory services delivered on a regional basis, through organizations that cover multiple client countries. This approach leverages World Bank Group expertise and enables delivery of beneficial economic impact at scale. FIAS has adopted this approach to support advisory projects in the Common Market for Eastern and Southern Africa, the Council of 1 1 1 2 1 Ministers for Central American Economic 1 1 1 2 1 Integration, the East African Community, 3 Mali 1 1 2 the Economic Community of West 1 1 Niger 1 Senegal African States, the Eurasian Economic 2 Chad Burkina 1 1 Commission (EEC), the Organization of 1 Faso 1 1 Eastern Caribbean States (OECS), and 1 1 1 1 1 1 1 Cóte d’Ivoire 1 1 1 1 the Western Balkans region, among 2 1 1 2 1 Central Guinea 1 1 other regional endeavors. Bissau 1 1 1 1 African Rep Guinea 2 Togo Benin Cameroon 1 Longstanding FIAS Equitorial 1 Rep of Commitment to OHADA Guinea 1 1 Congo DRC 1 1 1 1 One of the longest-running advisory 2 1 1 1 2 1 engagements on the regional level to 1 1 Gabon 1 benefit from FIAS support has been 2 the legal reform work in the 17 nations 1 Comoros of OHADA, the Organization for the Harmonization of Business Law in Africa. OHADA falls squarely within the priority areas of the FIAS FY17–21 strategy cycle: all are Sub-Saharan African countries; all but two are IDA Dots denote Uniform Acts; borrowing countries; and eight are in numbers refer to reforms inacted fragile and conflict-affected situations. With the completion of a decade of FIAS-supported reforms in OHADA resulting from advisory work in this economically new Uniform Acts on Commercial Law, Secured challenged region it is possible to step Transactions, Company Law, and Insolvency back and assess the impact of OHADA (Source: World Bank Group) reforms. Both the Bank Group’s own analysis and an independent evaluation of the multi-phase project agree: the member nations of OHADA have made Uniform Act on General Commercial Law Uniform Act on Company Law The UA on General Commercial Law introduced the The UA on Company Law introduced the SAS and significant progress in improving their entreprenant status and an effort to computerize the the GIE and simplified the creation of a SARL (2014). business climate and substantial strides RCCM (2011). in increasing the availability of credit Uniform Act on Insolvency Uniform Act on Secured Transactions The UA on Insolvency safeguarded liquidation and stimulating the formation of new The UA on Secured Transactions broadened the range procedures, facilitating recovery after business businesses. of assets that can be used as collaterals (2011). discontinuation (2015). FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 20 02 Established in 1993, OHADA has provided and protections for minority investors; a forum for the development of innovative it created new categories of securities, legal reform in francophone African including hybrid securities such as countries with the goal of creating a convertible bonds; and it simplified the uniform legal and regulatory framework company registration process for SARL encompassing accounting standards, (société à responsabilité limitée), a type arbitration, commercial law, collateral, of limited liability company common in company law, and insolvency. For French-speaking regions. more than a decade, the World Bank Group, with the support of FIAS and the In 2011, when the project’s second phase government of France, has helped develop was being planned, OHADA member a consistent and modern set of business states collectively were among the lowest codes covering all 17 member nations of performers in the annual Doing Business OHADA—Benin, Burkina Faso, Cameroon, ranking of countries. Doing Business the Central African Republic, Chad, the 2011 showed that out of 183 countries Comoros, Côte d’Ivoire, the Democratic worldwide, Burkina Faso ranked the best Republic of Congo, Equatorial Guinea, among OHADA countries at 151st. Six of Gabon, Guinea, Guinea-Bissau, Mali, the bottom ten countries on that year’s Niger, the Republic of Congo, Senegal, Doing Business ranking were OHADA and Togo. member nations. Doing Business 2019 showed that while OHADA countries Phase 2 of the FIAS-supported Uniform continued to face significant challenges Acts project focused on revising regional in terms of ease of doing business, laws or “Uniform Acts,” specifically the circumstances had improved markedly. Company Law and Insolvency Law, Out of 190 countries, Côte d’Ivoire had the and on continuing and strengthening best ranking among OHADA members, at implementation at the country level of 122nd (an improvement of 17 places from earlier reforms to the Commercial Law Doing Business 2018). And only three of and Secured Transaction Law. The revised the bottom ten countries were OHADA Company Law created a new form of nations. Of the global top-ten improvers in limited liability company, providing greater Doing Business 2019, four are from Sub- flexibility for contractual arrangements Saharan Africa, and two of those—Côte among shareholders; it modernized d’Ivoire and Togo—are OHADA member corporate governance rules, facilitating countries. the creation and operation of corporations, including the possibility of attending Substantial Beneficial Impact board meetings via videoconference of Reforms Now a newly published independent evaluation is providing a more granular IFC’s OHADA investment climate picture of the impact of FIAS-supported work in OHADA. The independent firms program initiative from 2007 to 2017 ECOPA and Economisiti Associati teamed up in preparing An Impact Assessment had significant impact on access to of OHADA Reforms, analyzing the Bank finance, business registration, and Group's OHADA investment climate program from 2007 to 2017. The business cost savings for all assessment, prepared to coincide with OHADA’s 25th anniversary, found that “the 17 member nations. OHADA initiative had significant impact on access to finance, business registration, and business cost savings.” FIAS 2018 Annual Review 21 $9.9m The study employed the synthetic control method (SCM) to build control country data to which observed impacts could be compared. It also relied on detailed case studies of Cameroon, Côte d’Ivoire, and Niger involving interviews of more than 150 representatives from government, The Bank Group’s Project Completion Report calculated business, the financial sector, and the legal that increases in domestic credit attributable to the profession. reforms resulting from both phases of the Uniform Acts project were achieved with a combined expenditure of Between 2011 and 2015, the analysis $9.9 million. determined that the Uniform Act led to $1.1b additional domestic credit to the private sector of $1.1 billion in Senegal, $894 million in Burkina Faso, $729 million in Togo, $607 million in Mali, $417 million in Cameroon, $33 million in Central African Republic, and $30 million in Comoros—a total of more than $3.8 billion. Results In Senegal, the Uniform Act led to $1.1 billion in were inconclusive for Benin, Côte d’Ivoire, additional domestic credit to the private sector. and Gabon, but SCM analysis from the other seven OHADA countries confirmed $7.8m the positive impact of the legal reform on domestic credit flows to businesses.2 The Bank Group’s Project Completion Report (PCR) calculated that increases in domestic credit attributable to the reforms resulting from both phases of the From 2015 through June of 2017, the Uniform Acts Uniform Acts project were achieved with a project also achieved $7.8 million in business cost combined expenditure of $9.9 million. For savings in six countries (Benin, Burkina Faso, Côte every dollar expended under the project, d’Ivoire, Guinea, Niger, and Togo). domestic credit was increased by $385, according to the PCR. From 2015 through June of 2017, the project also achieved $7.8 million in business cost savings in Average OHADA Getting Credit-DTF score six countries (Benin, Burkina Faso, Côte 45 d’Ivoire, Guinea, Niger, and Togo), against 40 a target of $7 million, through reduced 35 business registration time and costs, and 30 reduced notary fees. 25 20 The Uniform Act on Secured Transactions went into effect in 2011 and resulted in all 15 17 OHADA states broadening the range 10 of assets that can be used as collateral 5 and the range of obligations that can 0 be secured. One important result was 2010 2011 2012 2013 a marked improvement in the Doing Business indicator for getting credit, as Average OHADA getting credit score roughly doubled over two years shown here. following passage of Secured Transactions law. (Source: World Bank Group) 2 ECOPA and Economisiti, An Impact Assessment of OHADA Reforms, p 11. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 22 02 OHADA has addressed the costs and national legislation to reduce the paid- in minimum capital requirement to their administrative obstacles to starting a chosen level for the creation of a private limited liability company. Because of this business. Because of this reform, the reform, the average paid-in minimum average paid-in minimum capital required capital required to open a business across OHADA member countries dropped to open a business across OHADA by almost 50 percent in one year. The Democratic Republic of Congo enacted member countries dropped by almost the most sweeping reform, reducing the requirement by 98 percent—from 50 percent in one year. a one-time high of 500 percent of income per capita to 11 percent. Burkina Faso, the Comoros, Guinea, and Niger also dramatically reduced their paid-in One of OHADA’s top priorities has been minimums. OHADA countries also made making it easier to start a business. starting a business easier in 2014–15 by Sub-Saharan Africa has long compared decreasing administrative fees. Benin unfavorably to Organization for Economic reduced filing fees at its one-stop shop for Reducing the business registration, reducing the cost requirements to Cooperation and Development (OECD) countries in terms of ease of starting a of starting a business from 56 percent of open a new business income per capita in 2013–14 to 46 percent business, and OHADA countries have 98% compared unfavorably to countries in the in 2014–15. Togo reduced registration fees rest of Sub-Saharan Africa. This is generally with the tax authority, which decreased the attributed to OHADA’s inheritance of a set cost of starting a business from 95 percent of business laws common to francophone to 84 percent of income per capita. Africa that date back to the colonial era Significant progress in reducing the time and are generally regarded as antiquated The Democratic Republic required to open a business across OHADA compared to business laws in wide use of Congo enacted the was achieved by the establishment of the today. In 2005–06, for example, OHADA most sweeping reform, one-stop-shop for business creation in countries required 12 steps taking an reducing the requirement 2010–11. By 2015, the average time required average of 67 days to start a business, by 98 percent—from a one- to open a business across OHADA stood at compared to 10 steps and 54 days in time high of 500 percent 26 days, down from 67 percent a decade the rest of Sub-Saharan Africa. Paid-in of income per capita to 11 earlier, a 61 percent decrease. Guinea- minimal capital requirements—the amount percent. Bissau, the Democratic Republic of Congo, that an entrepreneur needs to deposit in and Senegal each reduced the number of a bank or with a notary to legally start a days by over 90 percent. In Guinea-Bissau, business—was also well above average where it took 260 days to start a business across OHADA. The capital requirement in 2005–06, it now takes only 9 days. Accelerated is measured as a percentage of per new business capita income in a country. In OHADA, the Impact of OHADA Reforms on start-up times minimum paid-in capital requirement more 9 days Creating Markets than a decade ago was nearly 400 percent of income per capita, versus 94 percent Across OHADA, the Uniform Acts on elsewhere in Sub-Saharan Africa.3 General Commercial Law and Company Law lowered the cost of forming Through a variety of reform initiatives companies, thus contributing to reduced under the FIAS-supported project, OHADA entry costs. Forming companies is In Guinea-Bissau, where it has addressed the costs and administrative easier and less costly. The Uniform Act took 260 days to start a obstacles to starting a business. In January on Secured Transactions has improved business in 2005–06, 2014, for example, OHADA economies collateral mechanisms, which have it now takes only 9 days. authorized each member state to adopt enhanced access to finance across the 3 Leah Nosal and Valentina Saltane, “Harmonization Strikes a Chord of Success: Doing Business in OHADA Economies,” in SmartLessons, (IFC, January 2016), p. 2. FIAS 2018 Annual Review 23 region, again contributing to lower entry in the Uniform Act was followed by a SARL registrations costs and increased competitive pressure. sharp increase in SARL formation after increase: 2014, when capital requirements for 30% The Company Law has supported the SARLs were lowered and the use of emergence of private equity funding, notaries was made optional, and some which has increased competitive pressure growth in SAS registrations (société par on the banking industry. In Cameroon, actions simplifiée, another form of limited Côte d’Ivoire, and Senegal, private equity liability company). In Senegal, SARL funds have been particularly active in registrations increased by 700, or about providing long-term equity or semi- 30 percent over the preceding year. In Senegal, SARL registrations equity finance.4 Other factors besides Similarly, in Niger, the OHADA reforms increased by 700, or about the OHADA reforms have contributed to can be credited with prompting some 30 percent after 2014. this development, but the reforms have 400 additional SARL registrations per played a significant role, and the increased year. Overall, business registration (of availability of private equity financing 400 all legal forms) has increased markedly is lowering entry costs particularly in in the 15 countries with available data, agroindustry, finance, construction, health, except Chad. It should be noted that and telecommunications. business registrations do not always lead to new business activity, as many newly Closing the Gap with the established firms go out of business soon Rest of Africa after incorporation OHADA member economies have In Niger, the OHADA implemented noteworthy reforms to Conclusion reforms can be credited close the gap between OHADA member with prompting some 400 Regulatory reforms in OHADA economies and non-member countries in Sub- additional SARL registrations in the last 10 years demonstrate the Saharan Africa. In the last 10 years, per year. power and potential of collective action approximately 25 percent of OHADA against common economic challenges.5 reforms (56 of 227) made starting a Where domestic regulatory reform business easier. Dramatic reductions appears politically untenable, working in the procedures, time, cost, and paid- with international partners can cultivate in minimum capital required to open a renewed enthusiasm for change. Overall, business business in OHADA member economies add up to a substantial improvement in In hopes of encouraging increased registration (of foreign investment, OHADA members their ease of starting a business over time. have established a regional business all legal forms) Across all OHADA countries, the average number of procedures required to start a regime with more streamlined business has increased processes and more robust legal business decreased from 12 procedures frameworks. The reforms achieved with markedly in the in 2005–06 to just over 7 procedures a decade later. Burkina Faso, Côte d’Ivoire, FIAS support in OHADA member nations appear to have staying power. There 15 countries with and Senegal implemented the most has been no incidence of reversal of any available data. significant reforms, reducing the number reform as of project closure. The program of necessary procedures by an average of has demonstrated that a regional about 63 percent each. approach can yield economic impact on the ground by connecting regional and As expected, the Uniform Act has led to national reforms. a surge in the number of SARLs (société à responsabilité limitée, a form of limited liability company common in francophone countries). In countries where data are available (Cameroon, Guinea, Guinea- Bissau, Côte d’Ivoire, Mali, and Senegal), the Company Law reform contained 4 ECOPA and Economisiti, Impact Assessment of OHADA Reforms, p. 58. 5 In addition to the World Bank Group and FIAS, other financial supporters of OHADA include the African Development Bank, Canada, the European Union, Switzerland, and the United Nations Development Programme. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 24 03 The core concepts underlying the FIAS program are to facilitate reforms in developing countries to foster open, productive, and competitive markets and to unlock sustainable private investments in sectors that contribute to growth and poverty reduction. 98 These priorities—along with the FIAS focus on IDA countries, Sub-Saharan Africa, and projects FCS—are reflected in the FIAS portfolio of 98 projects in FY18 (99 projects in FY17). Of these, 79 were client-facing (79 in FY17) and 19 were non-client facing in product 98 FIAS-supported projects in 86 development (20 in FY17). Of the 79 client- developing countries facing projects, 47, or 59 percent, were Operational entirely or partly aimed at IDA countries. And of the 76 borrowing countries in IDA, 47 52, or just over two-thirds, had FIAS- supported projects in FY18. Nearly one- third of the client-facing projects benefited projects FCS countries entirely or in part. And 34 of the client-facing projects—43 percent— were in Sub-Saharan Africa, benefiting nearly every country in that region. 47 FIAS-supported projects in 52 IDA countries and 24 projects in 25 FCS FIAS-supported work generated 40 countries reforms (62 reforms in FY17). Of those, Highlights 26 reforms, or 65 percent, were in IDA 34 countries (36 reforms, or 58 percent in FY17); 12 reforms, or 30 percent, were in Sub-Saharan Africa (20 reforms, or projects 32 percent in FY17); and 10 reforms, or 25 percent, were in FCS (13 reforms, or 21 percent in FY17). Overall, a record 107 Doing Business reforms were recorded 34 FIAS-supported projects in 45 for Sub-Saharan Africa in FY18, many Sub-Saharan Africa countries of them in countries where FIAS has supported extensive work in past years. FIAS contributes to a significant portion of the reform-oriented advisory work done by the Equitable Growth, Finance and Institutions Practice Group (EFI). The World Bank Group via IBRD and IDA supported 34 investment climate projects in 40 countries in FY18. FIAS is leveraging FIAS 2018 Annual Review 25 that portfolio with parallel projects in 32 FIAS FY18 work generated of those countries; 28 of which are in IDA and 13 FCS. Number of reforms 40 of which IDA 26 65% FIAS Focus on FCS of which FCS 10 25% The World Bank Group’s institutional of which validated by DB 32 80% focus on countries in fragile and conflict- of which SSA 12 30% affected situations (FCS) is strongly reflected in second-year results for the FIAS FY17–21 strategy cycle. Of the 36 states and territories on the World Bank produced consistently high participant Group’s FCS list for FY18, 24 countries and engagement and lively discussion; one territory, or 69 percent, had FIAS- learning goals and expectations were met. supported country-specific or regional Action plans were drafted by participants projects (23, or 58 percent in FY17). The spelling out content, target populations, 25 are: Afghanistan, Burundi, Central and delivery modes for post-workshop African Republic, Chad, the Comoros, sensitization activities in six municipalities. the Democratic Republic of Congo, Two remaining workshops were delivered the Republic of Congo, Côte d’Ivoire, in Kpalimé and Lomé in April. Next steps The Gambia, Guinea-Bissau, Haiti, involve monitoring and assessing results of Iraq, Kosovo, Lebanon, Liberia, Mali, the post-workshop sensitization activities Mozambique, Myanmar, Sierra Leone, and the drafting of an accompanying Somalia, Sudan, Togo, Yemen, Zimbabwe, report. and the West Bank and Gaza. FIAS support helped bring about reforms in 5 In FIAS-supported gender work, as in FCS countries (8 countries in FY17). Of the other global activities, the connections 40 reforms achieved with FIAS support in between global and client-facing projects FY18, 10, or 25 percent, were in FCS (13 of are evident in the work taking place 62 reforms, or 21 percent, in FY17). FIAS on the ground in client countries. In the supported a total of 24 projects touching FIAS-supported Togo investment climate on FCS countries either directly or as technical assistance project, for example, part of regional projects, amounting to 30 one of the explicit project aims is to percent of the 79 client-facing projects. encourage economic operators in the informal sector, particularly women, to Togo is one of several countries with formalize their enterprises and benefit FIAS-supported projects that falls into all from the advantages of formalization. The three priority categories: Sub-Saharan project is funding fund awareness-raising Africa, IDA, and FCS. An initiative in Togo in campaigns in Lomé and in major cities in spring of 2018 supported implementation the interior of the country, commercials on of a gender legal reform advisory project national television, panels and posters in which aims to raise awareness among Lomé and other major cities, and signage women, as well as government officials, on vehicles in urban markets. non-governmental organizations, and Togolese men, of new rights granted to women. These follow recent, significant amendments to the country’s Family and Penal Codes. Awareness-raising activities and workshop design and delivery were carried out as planned in FY18 in Togo. Modalities for data collection on reach and quality of post- workshop awareness-raising activities were defined. The Sokodé workshop FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 26 03 FIAS Leverage: How FIAS Projects Align with Other World Bank Group Interventions As a new feature in the FIAS 2018 Annual Review, look for the “FIAS Leverage” tag in text boxes throughout this chapter. The narratives describe how FIAS-supported projects relate to other World Bank (International Bank for Reconstruction and Development—IBRD) and IFC interventions in client countries, enlarging the impact of FIAS and ensuring that clients benefit from a comprehensive approach to fostering inclusive growth. FIAS Leverage Building Private Sector Confidence in Somalia Following more than two decades of conflict in Somalia, a new federal government emerged in Mogadishu in 2012 under a Provisional Constitution. Engagement with the international community over the next six years culminated in launch of the Somali Partnership Forum in Brussels in July 2018. The initiative aligns with Somalia’s National Development Plan, identifying priority areas for development. Somalia has continued to struggle economically. More than half the population lives in poverty and the economy, centered on agriculture, is vulnerable to shocks, such as the widespread crop failure and livestock mortality driven by drought in 2017 and record flooding in 2018. As part of a wide-ranging World Bank Group effort in Somalia, the FIAS-supported Somalia Investment Climate Reform Program (SICRP), launched in 2015 and concluded in December 2018, has sought to unlock and enhance private sector-led economic growth and competitiveness through targeted investment climate reforms. SICRP has laid the foundation for private sector development in this IDA, FCS, and Sub-Saharan African country. Reforms have been achieved in the areas of Doing Business, investment policy and promotion, and trade facilitation. The work is focused in the cities of Hargeisa in Somaliland and Mogadishu, seat of the Somali government. A public-private dialogue program (PPD) launched in June 2016 helped bring about passage of the Communications Act and Somaliland Company Law in 2017 , and the Somaliland Electric Energy Law in 2018. Engagement of the private sector through various PPD working groups was key to addressing a persistent lack of trust between the public and private sectors. Prior to the establishment of the platform, the private sector was missing from high-level meetings on economic development and conflict resolution. This negated the potential beneficial role of the private sector in peace building, security, rebuilding the country, job creation, and connecting Somalis across the peninsula and beyond. The training and support provided by the FIAS-supported project added the private sector’s voice to the development of the National Development Plans, passage of the Somalia Information and Communications Technology (ICT) and Somaliland Companies laws, and to the outcome of major international gatherings on Somalia’s economic and political future in London in May 2017 and Brussels July 2018. FIAS-supported investment climate work has informed the scale-up of World Bank and IFC programs in Somalia and the design of the Bank Group's Somalia Country Partnership Framework (CPF) for FY19–22. The next phase of the work will help Somalia invest in services and economic opportunities while continuing to address the structural drivers of fragility. SICRP contributed to the inclusion of Somalia for the first time in the Doing Business report beginning in 2017 . Despite its ranking—190th out of 190 economies measured—this is a significant achievement given the difficulty of getting data in an a fragile and conflict-affected context. SICRP has also supported the investment policy and promotion (IPP) capacities of the line ministries in Somaliland and the Federal Government of Somalia by providing technical assistance to review the foreign investment law in FGS and drafting an investment policy statement in Somaliland. The PPD, IPP , and business registration processes are complemented by websites supported by the program, such as SomInvest, a business information portal and PPD web site. These have enhanced information transparency in a context where information on business laws and regulations was very difficult to obtain. Diagnostic work in trade facilitation, particularly around the Berbera port and corridor, and other technical assistance have helped Somalia gain acceptance into the World Trade Organization (WTO) and the Common Market for Eastern and Southern Africa (COMESA). FIAS 2018 Annual Review 27 FIAS-supported investment climate work has informed the scale-up of World Bank and IFC programs in Somalia and the design of the Somalia Country Partnership Framework (CPF). Building under construction in Hargeisa, Somalia. Photo: Shutterstock FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 28 Pillar 1 Improve the Business Environment The FIAS support for projects under Pillar 1 in the FY17–21 strategy cycle seeks to improve the legal and regulatory environment, reduce the cost of doing business, signal to domestic and foreign investors a welcoming attitude toward business growth, and ease business uncertainty in sometimes volatile political and economic environments. Regulatory reform can produce quick wins in reducing Doing Business reforms. However, some countries in the business costs and saving time spent on licensing and region have not yet attained the level of reform intensity permitting. It can also protect society and stimulate necessary to unlock investment opportunities. The purpose business activity, not only through simplification but through of the third phase of the IBR–SSA project is to spur reform increasing transparency, consistency, and effectiveness activity in these countries, enabling IFC and other financiers of business regulation. FIAS-supported work under Pillar 1 to unlock their investment opportunities. focuses both on the design of regulatory reform and on effective implementation. The FIAS-supported Business Phase 3 of the project, which was in pre-implementation Regulation and Indicator-Based Reform (IBR) programs during FY18 and entered the implementation stage in help client governments take on these challenges by September 2018, differs from its predecessors in three developing laws, policies, and strategies that encourage ways: risk-taking, stimulate business activity, spark private sector growth, create jobs, and spread the benefits across > It focuses on countries with no dedicated advisory or societies. lending projects supporting the investment climate and business environment agendas. Sub-Saharan Africa > It prioritizes FCS and IDA countries where operating Despite the intensive investment climate reform activity in environment and capacity challenges pose Sub-Saharan Africa, businesses across the region struggle significant constraints to starting and sustaining in a difficult regulatory environment characterized by weak reform agendas. legal institutions and expensive regulatory processes. These > And it supports closer day-to-day supervision of businesses face the world's longest delays and highest reform activities helping them develop and prioritize costs for business start-up and operation. The region their reform agendas and supporting establishment underperforms in the areas of getting electricity and trading and capacity-building of their reform mechanisms. across borders, according to Doing Business 2019. For example, it costs on average nearly three times as much for As with the previous two phases, the project continues a business to get connected to the electrical grid compared to support the peer-to-peer learning agenda for the to the global average. And it takes 98 hours to comply with region by contributing to regional learning platforms that documentation requirements to import, compared with 61 enhance south-to-south knowledge exchange, promoting hours globally. a healthy competition for reforms across the region. The number of countries and the breadth of interventions will In Sub-Saharan Africa the FIAS-supported IBR–Africa remain flexible to meet client demand. As of the planning project has provided rapid-response technical assistance stage during FY18, a partial list of the countries expected to client governments in the areas measured by Doing to receive technical assistance during Phase 3 included Business indicators and helped improve their business Burkina Faso, Cabo Verde, Cameroon, Guinea, Malawi, environments through simplified, transparent, and low- Niger, Nigeria, Senegal, Tanzania, and Uganda. cost administrative processes. This objective aligns with the Bank Group’s efforts to enhance competitiveness and A sampling of the FIAS-supported work in Sub-Saharan employment in the region, with an emphasis on private Africa illustrates the focus on IDA and FCS, the commitment sector growth. The most recently completed phase of the to fostering private sector growth, the challenges involved project provided support to 35 governments, contributing to in making progress in strained economic environments, and implementation of 46 reforms validated by Doing Business a commitment to engagement with local private sectors as reports during the implementation period from January well as client governments. 2014 through April of 2017. The results surpassed the objective for the project and accounted for a quarter of In Guinea, FIAS-supported work helped strengthen the Sub-Saharan Africa’s reforms during this period. capacity of the online licensing system and contributed to the establishment of the commercial court. The project Since the conclusion of the first two phases of the IBR has organized a focus group to conduct preparatory work project, many of the countries have continued to institute FIAS 2018 Annual Review 29 for the launch of the commercial tribunal whose president commercial court by reviewing all the relevant texts and has been appointed. The project team has helped update missions of commercial judges. The legal text review formed the country’s Doing Business plan and provided support the basis for the reorganization of the commercial court for implementation of reforms, with a focus on business to improve handling of commercial litigation as well as the registration. Court's overall service delivery. This work was supported by the launch of the first training modules for judges covering In Togo, the project provided technical training in the commercial and OHADA laws and for administrative staff. implementation of new decrees for construction permitting. Participants included private sector stakeholders who are In December 2017 FIAS-support helped Madagascar seeking construction permits and public-sector stakeholders gain a commitment of support for a proposal by the responsible for managing them in the public agencies. college of economic advisers to champion the country’s Work is continuing in support of Togo’s investment climate reform agenda and investment climate interventions. The objectives. onset of political unrest in the spring of 2018 has shifted the government’s attention. Nevertheless, an advisory The investment climate work in Mali is supporting agreement was signed by the government in March 2018, development and implementation of economy-wide reflecting continued commitment to engagement with the reforms. These include increasing the effectiveness of the Bank Group on the reform agenda. FIAS Leverage Coordinated Bank Group Interventions in Mozambique FIAS-supported investment climate work in Mozambique (2015–2019) by supporting reforms that will help sought to improve the country´s business enabling improve the country’s Doing Business distance to environment and encourage private sector investment. frontier score and reduce barriers to investment. Designed by IFC as an umbrella project, the Mozambique effort responded to a request by the government for The project is linked to other ongoing Bank Group continued engagement critical in the aftermath of its operations. For example, the World Bank Mozambique “hidden debt” problems that have severely impact Integrated Growth Poles Project includes components investor confidence in the country. In April 2018 a revision aimed at developing institutional capacity to to the commercial code simplified the process of starting implement investment climate reforms that are a business by eliminating the notary requirement, supported by IFC advisory aimed at strengthening strengthening minority investor protections, and the capacity of the one-stop shop and improving improving corporate transparency. The reform also management of the Nacala special economic simplified business licensing through the one-stop shop. zone. Another Bank Group project is supporting The project helped organize a presentation of the Doing judicial reform in regulatory areas measured by Business 2018 report at a high-level event attended by Doing Business and complements the World Bank some 280 representatives of government, donors, and Mozambique Financial Inclusion Support Framework the private sector. The much-anticipated event served project to strengthen the country’s credit environment as an opportunity for national reflection on the business for SMEs by supporting implementation of the environment and for discussion of further needed insolvency law. reforms and on shared responsibility for implementing them. Through this integrated approach, Mozambique Investment Climate II and other Bank Group projects The FIAS-supported work under the Mozambique will be able to mutually reinforce each other in Investment Climate Program, Phase 2, aligns with the addressing sector-specific constraints in such areas government’s high-level priorities in its five-year plan as agriculture, forestry, tourism, and manufacturing. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 30 Pillar 1 Middle East North Africa The three-year IBR–MENA project has exceeded its initial goal Across the MENA region, governments are under pressure of supporting at least five client governments in the region and to move toward a more inclusive model of growth together achieving at least 12 Doing Business reforms. Since inception, with more accountable governing structures. The outcome the project has supported reform efforts in 9 countries and of this push for economic reform remains highly uncertain. one territory: Afghanistan, Algeria, the Arab Republic of Outdated regulations, high discretionary opportunities, Egypt, Iraq, Jordan, Kuwait, Morocco, Pakistan, Tunisia, and and gaps between laws and their implementation erode West Bank and Gaza. The project has provided technical investor confidence and increase risk perception. A wide support and advisory services to 57 government agencies range of available data points to the nature and scale of the across MENA, exceeding the originally planned 45 agencies. challenge. Findings across different indicator sets highlight The combined effort of IBR–MENA clients has resulted in the persistence of inadequate and cumbersome business implementation of 34 reforms validated by Doing Business regulations. According the Enterprise Surveys, it takes from 2015 to 2018 through either the improvement of needed 41 days to obtain an operating license and 95 days for a procedures or the elimination of unnecessary ones. The construction permit in the region (against averages of 30 project recommended the elimination or improvement of and 70 globally, respectively). Getting credit is harder in 56 policies, exceeding the original target of 30 policies, and MENA than anywhere else in the world, according to Doing delivered 31 reports across the 10 countries, exceeding the Business 2019, partly due to insufficient protections for originally planned 24 documents. These ranged from reform lenders and borrowers in collateral and bankruptcy laws. The memos to action plans, mapping assessment reports, and cost to comply with requirements for exporting is $442 on aide-memoires. average and takes 58 hours, compared with $139 and 12.5 Among the reforms achieved: Afghanistan improved its hours in the OECD. procedures for construction permitting; Egypt enhanced Afghan women making flower arrangements. Photo: World Bank FIAS 2018 Annual Review 31 FIAS Leverage Afghanistan Business Enabling Project Afghanistan has endured more than 35 years of near constant conflict. Violence continues to undermine livelihoods and economic activity. Nearly 1.7 million internally displaced persons have returned to Afghanistan from neighboring countries in the past two years. Over the same time, more than 1.1 million Afghans were internally displaced due to conflict. The World Bank Group holds to the view that economic develop cannot wait for a complete secession of hostilities but should proceed as an integral part of conflict resolution, and that private sector development is vital to Afghanistan’s economic future. With an undiversified product base, Afghanistan’s economy remains reliant on aid. Employment in the private sector is concentrated in low-productivity agriculture. Labor force participation is slightly under 50 percent, and domestic credit to the private sector is very low at 3.9 percent of gross domestic product (GDP), well below the 28 percent of GDP average for low-income countries. The continuing conflict has led private sector credit, firm registration, and private investment to contract sharply. Fewer than 10 percent of Afghans use formal banking products. Only 8 percent of the Afghanistan labor force are salaried workers. The FIAS-supported Afghanistan Business Enabling Project launched an effort to address some of these development challenges by delivering a Doing Business Reform Memorandum in March 2018. It highlighted reform recommendations across 10 areas measured by the Doing Business report. The memorandum’s findings were based on inputs collected through a series of interviews with public officials and entrepreneurs in Kabul. The project supported the drafting and enactment of two laws to improve in the country’s performance on investor protection, access to credit, and insolvency. The new limited liability company law signed on March 8, 2018, strengthens Afghanistan’s corporate governance framework and minority investor protections. The new law on insolvency, enacted on March 4, 2018, streamlines and improves insolvency proceedings, promotes reorganization for viable distressed companies and requires that secured creditors be repaid first during business liquidation ahead of other claims such as labor and tax. In March 2018, the government improved business registration procedures by reducing the combined business license fee from the equivalent of $424 to $1.32 for the business license, $6.62 for printing a hard copy of the license, and $26 for publication of a notice of incorporation, with validity of three years. FIAS supported two other projects in Afghanistan in FY18 focused on business licensing and investment climate. These combined efforts, along with other Bank Group advisory work, are beginning to pay off for Afghanistan. Doing Business 2019 ranked Afghanistan among its top 10 global improvers with five reforms in the areas of starting a business, getting credit, protecting minority investors, paying taxes, and resolving insolvency (see Annex 1.2). The country’s economy advanced to 167th place from 183rd the previous year in the global ease-of-doing-business rankings. On the measure of absolute progress toward best practice, Afghanistan significantly improved its Doing Business score by more than 10 points to 47 .77. The FIAS-supported investment climate work dovetails with World Bank projects aimed at stimulating inclusive growth. $100m The Inclusive Growth Development Policy Grant, launched in June 2017. For example, the Inclusive Growth Development Policy Grant, launched in June 2017 , is providing $100 million of IDA grants supporting reforms to expand access to economic opportunities for the vulnerable. Very much in alignment with the FIAS investment climate and business environment agenda, the IDA grant supports strengthening the policy and regulatory framework for private sector development. Resources provided through the stand-alone operation will help the government meet development objectives articulated in the Afghanistan National Peace and Development Framework. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 32 Pillar 1 minority investor protections and made it easier to start responded to additional requests from Ecuador and the a business; Jordan streamlined procedures for starting a Eastern Caribbean Central Bank (ECCB). business and registering property; Pakistan streamlined cross-border trading; and the West Bank and Gaza took Main highlights of the advisory services provided by the steps to make it easier to obtain credit. Additional reforms IBR–LAC project during FY18 include: were achieved in Algeria and Iraq. In Argentina, the project has been providing advisory The project adopted a highly flexible approach, responsive services to the government of Buenos Aires on improving to client requests for assistance. Rather than being bound the construction permitting process. A workshop to share to work in a designated set of countries, the team was international best practices in construction permitting was open to act upon any request for assistance from any convened in December 2017 and included representatives country across the MENA region. This allowed for demand- from the major permitting agencies and the private driven interventions, leading to actionable commitment sector. from clients and ensuring efficient delivery. The flexible approach also allowed for quick disengagement in In Guyana, the project has been providing focused situations where there was a lack of commitment. advisory on registering property flowing from a Resources could then be repositioned to respond rapidly to reform memo produced in 2016 that contained other requests for technical assistance. recommendations on improving regulations in five of the Doing Business indicators. The Ministry of Business has Latin America and Caribbean worked with the Bank Group on the design and launch of websites for the commercial, land, and deed registries Government regulation in LAC is still cumbersome to increase transparency on regulation. The websites (at for entrepreneurs despite recent improvements in http://dcra.gov.gy and http://landregistry.gov.gy/) will the investment climate. Entrepreneurs continue to help increase accountability and transparency within the face numerous bureaucratic hurdles and weak legal registries, reducing processing time by improving the protections, which can restrict firm creation. The completeness of the application and holding the agency excessive number of procedures for business entry and accountable for expected timelines. operations increase the compliance costs for firms to do business. Complex business tax regimes, meanwhile, The government of Jamaica has undertaken a contribute to lower levels of business creation, substantial investment climate reform effort and, in FY18, formalization and tax revenue. The region’s economies approached the World Bank Group seeking advisory perform best in the areas of getting electricity and services to support implementation of reforms. The getting credit. Obtaining an electricity connection in the project undertook a comprehensive assessment of region takes on average only 66 days, better than the 77- 10 Doing Business indicators. The project also entails day average in OECD high-income economies. However, three topic-specific action plans in the areas of paying the cost to connect to the electricity grid in the region taxes, construction permits and enforcing contracts. remains high, with an average cost of 946 percent of the These plans will serve as a road-map to prepare for the income per capita, compared to 64 percent income per implementation of specific activities recommended in capita in OECD economies. Since Doing Business began the memorandum. The IFC Advisory Services team in 2003, LAC has made major strides in ease of starting worked with the Jamaica Promotions Corporation a business. The average time to start a business in the (JAMPRO) in developing the reform memorandum. One region has declined by more than half to 32 days from 78 of the key goals is to demonstrate to the private sector days in 2003, and the cost has been significantly reduced the government's determination to make Jamaica a to 49 percent of income per capita, from 75 percent destination of choice for doing business. income per capita in 2003. Over the life of the IBR–LAC project, FIAS has supported Doing Business reform work in 18 countries in the LAC region, including IDA countries such as Dominica, Haiti, and Guyana, triggering a total of 20 reforms recognized by the Doing Business Report. In FY18 the project has been working primarily in Argentina, Guyana, and St. Lucia to advance reforms related to improving the investment climate, particularly in the context of the Doing Business indicators. The project has recently FIAS 2018 Annual Review 33 In St. Lucia, the project supported drafting of improved legislation on secured transactions and insolvency, Countries of the Europe and Central both of which are to be presented to parliament during Asia region (ECA) have performed FY19. More than 50 public officers, judges, and lawyers have been consulted through dissemination workshops consistently well in the annual Doing to discuss the new legislation and their supporting Business report on reform efforts. regulations. Feedback from these engagements is being incorporated into the draft laws. Once the laws are ECA economies, along with those of approved, the project intends to continue supporting the implementation of the new legislation through training Sub-Saharan Africa, were rated the workshops and completion of the supporting regulations. most active in reform work in the Europe and Central Asia Doing Business 2019 report. Countries of the Europe and Central Asia region (ECA) have performed consistently well in the annual Doing Business report on reform efforts. ECA economies, along with those of Sub-Saharan Africa, were rated the most active in During FY18 the IBR–ECA project helped Armenia amend reform work in the Doing Business 2019 report. Of the 23 the law on joint stock companies to strengthen minority countries in ECA, 19 implemented a total of 54 regulatory investor protections. In Azerbaijan, amendments to the law reforms improving the business environment. Of these, nine on bankruptcy and insolvency were introduced, improving countries—Albania, Azerbaijan, Bosnia and Herzegovina, the insolvency framework by providing for the possibility Croatia, Kazakhstan, Kosovo, the Kyrgyz Republic, to invalidate preferential transactions. In the Kyrgyz Serbia, and Uzbekistan—implemented a total of 18 reforms Republic, the project supported improvements in the case in FY18 attributable to FIAS-supported projects, most of management techniques used by the commercial courts them in the Doing Business areas of work covered by the and the introduction of a consolidated law on voluntary IBR–ECA project. mediation. And in Croatia, the project informed the activities of the parallel integrated land administration system project Despite these achievements, firms in ECA continue to and supported the digitization of the national land registry, face a complex and uncertain business environment in thus leading to increased efficiency and the transparency of many countries. Regulatory weaknesses remain that are the registration, sale, and purchase of real estate property. associated with lower levels of entrepreneurship, firm growth, and formal job creation. Enterprise Surveys have The project has not only informed the design and shown that senior managers in ECA spend 10.6 percent implementation of business environment reforms but has of their time dealing with government regulations, more also helped clients set up institutional structures to enable than twice the OECD average. More than one-third of firms them to sustain the reform momentum after the project identify corruption as a key constraint to operations and is completed. For instance, Albania has set up ten Doing identify obtaining electricity as a key obstacle. And 40 Business reform working groups, which initiate reforms and percent of firms point to high tax rates as a significant issue. report their progress directly to the prime minister. Similarly, in Tajikistan, the project has supported the Investment The IBR–ECA project ran for three years and closed in Council in building capacity and serving as a coordinating November 2018 with a “highly successful” development committee for all line ministries involved in the Doing effectiveness rating. FIAS-supported programs have helped Business reform agenda, with progress reported directly to 12 economies design and implement 42 reforms to date the president. Similar structures have been set up in Kosovo that have been validated by the Doing Business report and the Kyrgyz Republic. over the past three years. The project has supported one or more of the top Doing Business reformers in each of To support innovation, respond to client demand, and the last four years: Azerbaijan with eight reforms in Doing replicate its successful reform in Albania, the project has Business 2019 (three of them FIAS-supported); Uzbekistan triggered the development of a broader technical assistance with five reforms and Kosovo with three in Doing Business offering on construction permitting reform, offering the 2018; Kazakhstan with seven reforms and Serbia with three clients assistance not only related to the Doing Business reforms in Doing Business 2017; and Uzbekistan with three indicator but also to the broader building environment and reforms and Kazakhstan with seven reforms in Doing building permits administration. Business 2016. The project also successfully supported IDA and FCS in ECA, including Kosovo, the Kyrgyz Republic, and Tajikistan. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 34 Pillar 1 Armenia Reform Effort Delivers Strong Results As an example of the FIAS-supported work improving business regulations, the Armenia investment climate reform project, which concluded in FY18, focused on improving the country’s economy through investment policy changes and improved business inspection procedures. In FY18 the project analyzed the competitiveness of the agribusiness sector in terms of competitiveness for attracting foreign direct investment (FDI). The sector scan considered aquaculture, fruit and vegetable production (both open and greenhouse production), flower production (greenhouses), and dairy. The results pointed to greenhouse-based production of flowers and fruits and vegetables as offering the best proposition to potential investors. These subsectors have a good recent investment track record, a well-established production base, require relatively low levels of imported inputs, entail potential export opportunities for both regional and global markets, and have competitive natural endowments. To help improve business inspections, the project focused on optimizing inspections to increase efficiency and improve regulatory certainty through reorganization and restructuring of inspection organizations and elimination of duplication. In early FY18, the project conducted a compliance cost savings survey of 600 active private businesses in Armenia. Data collected covered the time and cost to businesses of inspections; and private sector feedback on the administrative burdens imposed by the regulatory framework; the transparency and clarity of rules; and awareness of inspection requirements. Taken together the data pointed to compliance cost savings of about $20 million to Armenian businesses as a result of the reforms. A further perceptions survey found that most companies believed that the inspection system has improved (64 percent) and that inspections are fair (76 percent). The project achieved all of its outcome targets. Feedback from key stakeholders showed that the project aligned with Armenia’s economic development goals and has the potential to lead to substantial beneficial impacts, including additional investment generation and private sector savings. The key stakeholders have validated the two overriding results claimed by the project: In investment policy and promotion (IPP): the development of an investment reform map (IRM); revision of the FDI Law of 1994 to introduce protection guarantees to investors; creation of database of incentives for foreign investors and making it public; increased knowledge and skills of investment promotion agencies; increased production volume; and access to new markets in aquaculture, greenhouse production, and the cheese subsectors. In inspections: improved access to information on inspections for the private sector; reduction of the number of inspections bodies from 18 to 6; increased knowledge and skills of inspectors through annual mandatory training; improved laws on inspections and inspections bodies. Local people sell Armenian homemade jams and traditional sweets made from dried fruits at the market near the ancient temple of Garni, Armenia. Photo: Bigstock FIAS 2018 Annual Review 35 The Armenia investment climate reform project, which concluded in FY18, focused on improving the country’s economy through investment policy changes and improved business inspection procedures. $20m compliance cost savings As a result of the reforms compliance cost savings of about $20 million to Armenian businesses were achieved. Bakers making traditional Armenian bread in Yerevan, Armenia. Photo: Sala Jean/Bigstock FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 36 Pillar 2 Expand Market Opportunities Pillar 2 in the FIAS strategy encompasses advisory work in investment policy and promotion (IPP) and markets and competition policy (MCP) as well as sector work in industry solutions in manufacturing, tourism, and agribusiness. EFI and clients collaborate on projects aimed at reducing > Bosnia and Herzegovina, $23.14 million: Through or removing barriers to creating or entering markets. The support for investment promotion and follow-up, the work spans a broad range of economic activity and strategic project supported and tracked several investment approaches that help client countries foster growth in their initiatives using a bottom-up tracking approach most promising economic sectors. The investment policy based on firm-level data and applying the Systematic work helps economies not only generate investment but Investment Response Mechanism (SIRM). retain it. Competition policy work can involve advisory services focused on specific market sectors, or it can involve > The Kyrgyz Republic, $882,000: The project helped economy-wide reforms that create level business playing develop an investment grievance mechanism through fields for a broad range of market participants. a regulation on out-of-court settlement of disputes and complaints. The resulting savings to investors IPP Work Continues Momentum in Expanding Market was documented through investor interviews. Opportunities During FY18, FIAS continued to support IPP work expanding market opportunities in developing countries. As always with FIAS projects, the emphasis is on IDA, FCS, and Sub-Saharan African countries, as the narratives below indicate. But the IPP work is benefiting a wide variety of countries and economies. For FY18, FIAS-supported work in investment In Mali a FIAS-supported project continues to policy and promotion contributed to securing of $33 million contribute to investment generation. The client—API in private sector investment in three client countries, Mali, the national investment promotion agency— Albania, the Kyrgyz Republic (an IDA borrowing country), helped 10 new investment projects in FY18 in the and Bosnia and Herzegovina. agribusiness sector, representing $3.2 million in investment and 287 new jobs, 114 of which were > Albania, $9.04 million: The project is building the for women, according to project estimates. One capacity of AIDA, the country’s investment promotion of the notable investments to emerge from this agency, to provide aftercare services. AIDA helped intervention is fostering expansion and job creation Albaco Shoes solve issues that were holding up by SOMABIS SARL, a domestic producer of biscuits construction permitting for expansion of its factory. and candy. The company, based in Bamako, Mali, With the permitting issue resolved, the expansion became operational in 2014 and now employs was able to proceed. 120, including 48 women. The firm is considering expansion of several production lines, aiming at $33m doubling production during the next 18 months. Notably in this fragile economic environment, 7 out of the 10 investments surveyed have plans to expand. in private sector investment The quality of service provided by API Mali, the national investment promotion agency created with the help of the FIAS-supported project, was rated at an average of For FY18, FIAS-supported work in investment policy 3.8 out of 5 by the 10 investors surveyed; 9 of these and promotion contributed to securing of $33 million companies said that API Mali was the most helpful in private sector investment in three client countries, agency they have dealt with during their establishment Albania, the Kyrgyz Republic (an IDA borrowing process. This shows a significant improvement in the country), and Bosnia and Herzegovina. client’s capacity and service delivery. FIAS 2018 Annual Review 37 FIAS Leverage Investments and Reform Work in Mali Mali is a vast, mostly arid country with a population of almost 18 million and a highly undiversified economy vulnerable to commodity price fluctuations and the consequences of climate change. High population growth and drought have spurred food insecurity. Political instability, marked by a military coup in 2012 and occupation of northern regions by armed groups, has added downward economic pressure on this IDA and FCS country. A presidential election in 2013, local government elections in 2016, and peace negotiations between the government and two rebel factions preceded the establishment in July 2017 of the Sahel Alliance by the European Union, France, Germany, United Nations Development Programme, African Development Bank, and World Bank Group to assist with regional stabilization. In this context, the FIAS-supported Mali Investment Climate 3 project has been working to increase the scope for the private sector to play a stabilizing role in the economy through revitalization of reform momentum, removal of barriers to SME creation, and promotion of private investment. Unfavorable investment climate remains a critical constraint for businesses. Before the crisis, the country was one of Sub-Saharan Africa’s strongest investment climate reformers, closing the distance to the Doing Business frontier by more than 6 percent from 2007–2012. Severe constraints on businesses persist despite these earlier reform efforts. The investment promotion work has helped in the development of a corporate strategy, training, and coaching for API Mali, the national investment promotion agency and the organization of an investor forum held in December 2017 . Much of this work is directly linked to the $30 million World Bank Mali Support to Agroindustrial Competitiveness that has an objective to increase the processing of agricultural products for targeted value chains, including expansion of mango processing, rehabilitation of rural roads, and modernization of harvest facilities. The lending project includes an outreach program to generate investments in horticulture and animal feed sectors by improving Mali’s image as an agribusiness location and by generating a pipeline of agribusiness investors and converting leads into actual investments. Mali also participates in the Invest West Africa program, supported by FIAS and aimed at generating greater investment and increasing access to finance through such means as a warehouse receipts system of collateral, and the FIAS-supported OHADA Uniform Acts legal reform initiatives. An FY18 reform in Mali made enforcing contracts easier through a new law that regulates all aspects of mediation as an alternative dispute resolution mechanism. Workers at SOMABIS SARL, producer of biscuits and candy based in Bamako, Mali. The firm is expanding with the help of FIAS- supported Investment Policy and Promotion projects. Photo: World Bank Group FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 38 Pillar 2 Strong Support for the G20 Compact with Africa assistance—including FIAS-supported programs—in FY18 to support Compact country matrixes. One of the priority areas of work for the Bank Group in investment generation as well as business regulation Between 2017 and 2018, three Compact countries achieved reform is the G20 Compact with Africa (CWA), bringing significant improvement in closing the Distance to Frontier, a together the G20, the International Monetary Fund (IMF), the key measure of the annual Doing Business report. Senegal African Development Bank (AfDB), and a dozen countries moved furthest towards the Frontier (+3.75), followed by in North and Sub-Saharan Africa. The Compact focuses Rwanda (+3.21), and Ethiopia (+2.08) with reforms in such on promoting private investment on the continent—both areas as establishing credit bureaus, eliminating stamp domestic and foreign direct investment (FDI). The Bank duties, and streamlining construction permitting and Group works with Compact countries to identify priority business licensing. All nine Sub-Saharan Africa countries areas for reform and promising sectors for new investment. in the Compact are IDA members; two (Côte d’Ivoire and It then works with them to implement reform and supports Togo) are FCS countries. key infrastructure investments to improve ports, roads, the power grid, and other vital economic assets. “The Compact with Africa rests on a simple idea: that Africa —from Cape Town to Tunis—is a continent of opportunity,” FIAS support has underpinned CWA-related initiatives in all then-Bank Group President Jim Yong Kim said at the 12 Compact countries—Benin, Burkina Faso, Côte d’Ivoire, Berlin summit meeting on the Compact hosted by German Egypt, Ethiopia, Ghana, Guinea, Morocco, Rwanda, Chancellor Angela Merkel in October 2018. “To fulfill the Senegal, Togo, and Tunisia. FIAS-supported advisory continent’s potential, we need a significant, urgent shift in services in CWA countries work in tandem with lending policy and funding that puts growth, jobs, and the private and investment instruments. In April 2018, the annual CWA sector at the forefront. Trillions of dollars will be required to Monitoring Report, prepared by EFI, documented 101 specific meet the current development challenges, and traditional reform commitments by Compact countries in furtherance aid channels will simply not be enough. It’s critical to of their reform matrices. The Bank Group provided $31 mobilize the private sector through innovative initiatives like million in analytical and advisory services and technical the Compact. Construction workers on-site at A&C Square, an extension to an office and retail development in which IFC has invested, under construction in Accra, Ghana. Photo: Nyani Quarmyne (Panos)/IFC. FIAS 2018 Annual Review 39 Investments and Reform Work in Guinea and regulatory environment for businesses, streamlining licensing and permitting requirements related to mining Having emerged from the Ebola crisis and a disputed activities, and improving the policy framework around presidential election, Guinea achieved robust economic the promotion of local content in the mining sector by growth of 8.2 percent in 2017 on the strength of enhancing linkages between multinational and domestic increased mining production (particularly bauxite), new firms. The IPP work entails strong engagement with the construction activity, good agricultural performance, and client and the private sector and continuing support for improvements in electricity service delivery. Guinea’s policy implementation. An assessment of FDI linkages in growth potential lies in sectors such as agriculture the mining sector and a strategic action plan to promote and natural resources as well as in the processing of local content were finalized through a public-private goods and other services. Agriculture provides income dialogue process. The project also helped complete for 57 percent of rural households and employment preparatory design work for the development of an online for 52 percent of the workforce. To realize its potential supplier database. The program is helping develop and and accelerate structural transformation, Guinea needs launch a buyers’ supplier marketplace which will host to improve its overall governance and address its the supplier database and facilitate access to market vulnerability to climate change, reflected in increasing opportunities for local businesses along the mining value average temperatures and a drop in average annual chain. rainfall. Among the World Bank initiatives supportive of the CWA In FY18, pursuant to its CWA agenda, Guinea achieved development agenda in Guinea, the $25 million Power three investment climate reforms with FIAS help: Guinea Sector Recovery Project, launched in early 2018, seeks made starting a business easier by allowing registration to improve the technical and commercial performance of with the labor promotion agency at the one-stop shop; the country’s public utility, Electricite de Guinee. Guinea made construction permitting less costly and time is also receiving World Bank and IMF support in coping consuming; and streamlined property registration by with deepening fiscal imbalances, reflecting the broader reducing the property transfer fee (see Annex 1.2). trend of rising debt globally. World Bank and IMF teams The FIAS-supported Guinea Investment Climate Mining are working closely with the Guinean authorities to project aims to improve the business environment and ensure that all new loans in 2018 and onward have a high spur private sector development by improving the legal degree of concession and strong development impact. Miners in Guinea. Photo: Bigstock FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 40 Pillar 2 Investment Climate and IPP Work in Tunisia The project will be providing hands-on training to ensure this person is well trained and equipped to carry out this An investment climate and investment generation project important role. supported by FIAS in Tunisia closed at the end of FY18 having made sufficient progress that the team is confident Project activities are fully funded by SECO's Multi-Country a follow-on project will be forthcoming. With the help of the Investment Climate Program (MCICP); additionally, the project project, FIPA, the country’s investment promotion agency, was successful in gaining supplementary funds from the revised its strategy to launch a best-practice marketing G20 CWA Facility to supplement and support a new activity and outreach investor services program. FIPA established on regulatory governance and public-private dialogue. This priority target sectors for investment promotion, namely, project proposes a mix of shorter run and medium-term automotive, aerospace, information technology and business interventions, building on previous reforms and supporting process outsourcing (ITO/BPO), electronics, and agriculture. the Government in achieving its high priority policy goals of FIPA also conducted three sector-targeted investor outreach addressing weaknesses in business environment and seizing missions to six cities in three countries (Canada, China, and sector-specific reform opportunities. Japan). FIPA increased the number of first-time presentations to investor leads and the number of leads generated by its Investment Policy and Promotion in South Asia outreach missions. The FIAS-supported South Asia Regional Integration This contrasted with circumstances when the project in Trade and Investment Promotion project (SARTI IP) began in July 2012 (the beginning of FY13) when FIPA had concluded at the end of FY18 having scored significant limited capacity to provide marketing or outreach services positive impacts in removing impediments to cross-border to investors, had not yet identified strategic sectors, and investment entry and operations, improving critical investor possessed limited experience on proactive outreach to services, and building capacity for investment promotion and strategic investors. This enabled FIPA to evolve from a long-term facilitation of regional FDI. The project, now in post- generic approach in which engagements were generally implementation, required responses tailored to the specific limited to large promotion events to a much more targeted and varying needs of participating countries. In Bangladesh strategy benefiting both Tunisia and potential investors. The and Nepal, the focus was on regulatory and process reform work is aligned with IFC’s Creating Markets initiative. streamlining. Investment promotion was a key focus in Bangladesh and India. More recently, work has been under Ghana Investment Climate Project Under Way way to establish a one-stop shop for investment facilitation in Nepal, while in Bangladesh, further investor services and The Ghana investment climate project went into sector-specific investment promotion work is being carried implementation phase in April of 2018 with the aim of out under the Bangladesh Investment Climate Fund program. boosting sustainable economic growth and promoting diverse private sector investments by improving the A key initiative of the project in India involved stepping up transparency, accessibility, and quality of business regulation the operational capacity of Invest India, the national-level and regulatory governance, as well as strengthening of the investment promotion agency, and facilitating engagement investment policy and promotion framework. with state-level investment agencies. Within three years, with the help of the FIAS-supported project, Invest India went The project, which is closely aligned with parallel World from a 10-person agency searching for strategic direction Bank Development Policy Operations and Economic to a robust organization with 115 staff members providing a Transformation projects, is gaining significant visibility as it seamless investment experience for foreign investors. The provides support to deliver Ghana’s reform commitments support produced an institutional IPP reform at the national under CWA. The project continues to provide frequent level this fiscal year. Invest India was highly satisfied with updates to the country’s senior leadership, which is the advice. The organization sent a letter requesting further championing the CWA reform agenda and investment goals. support for a transition to “Invest India 2.0,” and support for A particularly exciting early development was the decision development of Subnational IPA capacities. The project is of Vice-President of Ghana to assign a person on a full- currently designing a new engagement to respond to client time basis to oversee the reform effort and provide regular needs. updates to the government’s economic management team. Invest India, the national-level investment promotion agency, increased its operational capacity and facilitated engagement with state-level investment agencies. Within three years, with the help of the FIAS-supported project, Invest India went from a 10-person agency searching for strategic direction to a robust organization with 115 staff members providing a seamless investment experience for foreign investors. FIAS 2018 Annual Review 41 In October 2018, at the World Investment Forum in Geneva, the United Nations Convention on Trade and Development (UNCTAD) awarded Invest India its top UN Investment Promotion Award in recognition of its efforts to boost investments in the renewable energy sector. UNCTAD said the judges conferred the award for Invest India’s “excellence in servicing and supporting a major global wind turbines company in the establishment of a blade manufacturing plant in India while committing to train local staff and produce one gigawatt of renewable energy. Implementation of the project is expected to reduce India’s wind energy cost significantly.” As of fall 2018, Invest India had responded to 120,000 investor queries from 115 countries and 47 business sectors; 92 percent of the queries were answered within 72 hours. The project pipeline is an estimated $96 billion, with $14 billion materialized and credited with creating 108,000 direct jobs. In Nepal and Bangladesh, support for legal and policy reform led to establishment of the Bangladesh Industrial Policy and legislation concerning FDI and special economic zones in Nepal. The FIAS-supported effort has helped both Kolkata International Airport, India. Photo: Bigstock governments clarify, streamline, and automate policies and procedures important for investors, including FDI approvals, business visa approval for expatriates, foreign borrowing approvals, and repatriation approvals. The main challenge A 2014 investor forum in Bangladesh generated 11 advanced facing the program was that FDI services are spread over leads estimated at $55 million; a follow-up event two years multiple ministries, agencies, and central banks. There later facilitated a $15 billion investment pledge, of which $11 were also regional sensitivities and dynamics that needed billion was sourced intra-regionally. By 2018, $3 billion of the to be understood and managed. Work assisting Nepal in investments—originating from India—were fully committed. automating its investor services took additional time in Reforms implemented via the project have resulted in a fragile post-earthquake environment. However, as of $400,000 in business cost savings annually in Bangladesh; September 2018 Nepal’s Department of Industry confirmed once automation has been validated, the cost savings in that the automated system was operational. Nepal are expected to reach $362,000 annually. $3 billion $400 k By 2018, $3 billion of the investments— Annual business cost savings in Bangladesh originating from India—were fully committed $362k Projected cost savings in Nepal annually FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 42 Pillar 2 FIAS Leverage Investments and Reform Work in India With 1.2 billion people and the world’s third-largest economy in purchasing power parity, India has achieved significant growth recently and is striving to increase shared prosperity and become a high-middle income country by 2030. India’s government has prioritized increasing investment in manufacturing, as reflected in the Make in India campaign, which aims to create 70–100 million non-farm jobs in the next decade. India’s success will be central to the world’s collective ambition of ending extreme poverty and promoting shared prosperity, as well as for achieving the 2030 Sustainable Development Goals (SDGs). Extreme poverty dropped substantially in India, from 46 percent in 1995 to just over 13 percent by 2015. Challenges remain, including the uneven distribution of prosperity across population groups and regions, declining female labor force participation, and lagging levels of private investment and exports. India’s ambitions are reflected in a robust Bank Group portfolio, with nearly $3.5 billion in IFC and IBRD commitments in FY18. India has moved up markedly in the annual Doing Business rankings. From 142nd in the 2015 report, Doing Business 2019 ranks India 77th out of 190 countries. The FIAS-supported India Ease of Doing Business project, launched in 2015, has played a role in this dramatic improvement, fueled by the government’s keen interest in improving the regulatory environment for business. Through FIAS-supported advisory work, India achieved five investment climate reforms in FY18 in the areas of getting credit, construction permitting, starting a business, tax simplification, and trade logistics (see Annex 1.2). FIAS is also supporting the Buddhist Circuit project, aimed at helping India build and implement an integrated strategy for developing the unfulfilled potential of the Buddhist Circuit as a tourism destination. The Ease of Doing Business project is one component of the government’s Make in India strategy, and its effort to increase manufacturing from 16 percent of GDP to 25 percent by 2025. This FIAS-supported work is designed and executed in close coordination with other Bank Group interventions in India, including the $250 million Skill India Mission Operation project, scheduled to continue into 2023, seeks to enhance institutional mechanisms for skills development and increase access to quality and market-relevant training for the workforce. Project components include institutional strengthening at the national and state levels, ensuring that training providers have access to the latest technical resources and materials, and improving access to training for women. A parallel World Bank project, Innovate India for Inclusiveness, is putting $125 million toward facilitating innovation in biopharmaceutical products and medical devices that address public health priorities in India. $3.5 billion India’s ambitions are reflected in a robust Bank Group portfolio, with nearly $3.5 billion in IFC and IBRD commitments in FY18. India has moved up markedly in the annual Doing Business rankings. From 142nd in the 2015 report, Doing Business 2019 ranks India 77th out of 190 countries. FIAS 2018 Annual Review 43 Through FIAS-supported advisory work, India achieved five investment climate reforms in FY18 in the areas of getting credit, construction permitting, starting a business, tax simplification, and trade logistics (see Annex 1.2). Bridge under construction at Ghansoli, Navi Mumbai, India. Photo: Shutterstock FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 44 Pillar 2 FIAS Leverage Investments and Reform Work in Georgia The economy of Georgia was one of the fastest growing in Europe and Central Asia over the last decade, with an average GDP growth rate of 5.4 percent from 2005–2015. The government has achieved consistent macroeconomic stability and implemented reforms that have raised Georgia’s Doing Business ranking dramatically, from 112th in 2004 to 6th in the Doing Business 2019 report—ahead of Norway, the United States, and Great Britain. Poverty declined from 32.5 percent in 2006 to 17 .1 percent in 2016. The poor have benefited considerably from the government’s social policies, as well as from new economic opportunities. Although inequality remains high by regional standards, it has been declining in recent years thanks to strong improvements in the welfare of households in the bottom 40 percent of the income distribution. Deep reforms in economic management and governance have earned Georgia the reputation of “star reformer. ” With FIAS support, the Georgia National Investment Agency has developed and implemented a targeted investor aftercare program. The agency approached existing investors to identify their issues and help them make further investments. According to investor survey results, IPP activities generated investments amounting to an estimated $28.4 million, exceeding the project target of $18.7 million. The FIAS-supported Georgia Trade, Investment, and Agricompetitiveness project seeks to promote sustainable private sector growth through reforms in the agribusiness sector, aligning the country’s food safety regulations and standards with EU requirements, and by opening new markets for food export by SMEs and small producers, notably honey exporters. In May of 2018, a new online business ombudsman portal developed with the help of a FIAS-supported project became operational in Georgia. The portal establishes a systemic investor response mechanism to help solve issues faced by businesses and ensure easy and efficient communication between entrepreneurs and a business ombudsman. The information received via the portal will provide analytical data about the main trends and issues faced by the business sector. The FIAS project complemented an effort on the World Bank side, a $50 million Private Sector Competitiveness Development Policy Operation 2 project, which also focused on stimulating investment in high value-added production and creating a fair business environment through second-generation reforms, establishing enabling conditions for financial sector deepening and diversification, and increasing firms’ capacity to innovate and export. 5.4 % GDP growth rate from 2005–15 $28.4 m $50 m According to investor survey results, A $50 million World Bank Private Sector IPP activities generated investments Competitiveness Development Policy amounting to an estimated $28.4 Operation 2 project, which focused on million, exceeding the project target stimulating investment in high value- of $18.7 million. added production through reforms, diversification and innovation. FIAS 2018 Annual Review 45 Georgian small business owner seeking line of credit. Photo: Flickr World Bank FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 46 Pillar 2 Expanding Competition Policy Portfolio Globally, FIAS continued to support the development, piloting, Delivers Impact and scaling up of the Markets and Competition Policy Assessment Tool (MCPAT) that helps identify and prioritize In FY18 FIAS supported work in markets and competition reforms to open key markets to private investment and policy (MCP) across a range of activities and products that build partnerships and advocacy networks to highlight and boost the effectiveness of client-facing work on competition replicate good practices in promoting open and competitive policy in client countries. The global product development markets. FIAS-supported MCPAT tools have been able project serves to exchange knowledge on design and to inform major structural reform programs in countries impact of pro-competition reforms, drawing on experience undergoing deep political reforms: and lessons learned from competition policy activities in developed and developing countries alike. Experience in Sub-Saharan Africa and in Latin America shows that cartel episodes for products repeat across neighboring countries, and agreements can include provisions to allocate national markets among competitors, leading to significant overcharges to consumers. Seeking to address these issues, the FIAS-supported Promoting Competition program in FY18 FIAS Leverage piloted new approaches to eliminating barriers to competition and generating and disseminating knowledge on the benefits of more competitive markets for Sub-Saharan Africa. A project in Argentina used MCPAT to produce a At the regional level, the Competition Commission of the flagship report for the new administration that laid out 19-country Common Market for Eastern and Southern a reform path to better integrate Argentina into the Africa (COMESA), along with national competition global economy. The report was launched in December authorities, benefited from tools to strengthen regional 2017 at an event in Buenos Aires in the context of the anticartel enforcement. These are informing their strategy, WTO Ministerial. The event drew a large in-person protocols, advocacy for legal amendments, and enforcement audience, over 3,000 live viewers on Facebook, and activities. In Kenya, the promoting competition program over 48,000 individuals who saw or interacted with has supported reforms in the professional services to the content. Argentina approved a new competition eliminate minimum prices for selected services that are law in May 2018. The country’s competition authority, key for affordable housing—a priority sector for the current better equipped now with investigative tools, took government. The program has provided technical advice steps to dismantle three cartels in the health sector. A to enhance competition regulatory frameworks. Draft larger development policy operation by the World Bank competition rules will address issues in Kenya relating to is now supporting implementation of the remaining burdensome merger control, fining, and due process. In the reform program. Reducing regulatory restrictiveness East Africa Community (EAC), a more detailed framework in key input sectors such as telecommunications and on subsidies control will help countries reduce distortions transport would translate into an estimated additional on competition and trade. The global team has helped 0.1 percent to 0.6 percent growth in annual GDP . regional projects design and implement interventions with competition activities in at least five jurisdictions, contributed to Bank Group strategic documents in selected countries, and co-authored competition knowledge pieces in Senegal and South Africa. Dissemination of the Bank Group’s report on competition in Africa, Breaking down Barriers: Unlocking Africa’s Potential through Vigorous Competition Policy, brought together private and public stakeholders from East Africa in Kigali, Rwanda, at a forum focused on regulatory frameworks that enable competition and boost access in telecommunications, contributing to participation in the digital economy. FIAS support was essential to dialogue with the Rwanda government to achieve a reform of mobile termination rates. The regulatory change will reduce mobile termination rates to level the playing field and allow smaller operators to compete. FIAS 2018 Annual Review 47 FIAS Leverage FIAS Leverage Similarly, in Uzbekistan, the MCPAT application FIAS-support is helping to encourage a policy dialogue informed a policy operation that supports with the government of Armenia. Structural reforms fundamental economic and social reforms that will are needed to promote the entry and expansion of put the country on a new development trajectory. productive firms in tradeable sectors and productive The government still participates extensively in non-tradeable input sectors. MCP had previously markets through state-owned enterprises (SOEs) identified that prices of certain essential food products and excessive regulation and influence. In some key such as milk, eggs, bread, and butter were higher sectors, SOEs dominate many of the concentrated than in other Commonwealth of Independent States markets. Uzbekistan’s manufacturing sector has countries by at least 23 percent even after controlling more monopolized markets than any comparator in for proxies of market size and transportation costs. the region, and unlike other countries, Uzbekistan This is consistent with the finding that markets for saw this share increase from 21 percent to 26 production and import remain highly concentrated, for percent between 2008 and 2013. Thanks to Bank example, in granulated sugar, petrol, fruits, and poultry, Group-supported reforms, stricter limits on price and that market entry has often not been associated controls have already been achieved, and MCP has with price reductions. These competition policy provided technical assistance through reimbursable analytics have supported parallel work in Armenia, also advisory services (RAS) and IFC Advisory Services supported by FIAS, to help attract export-oriented, on how to rationalize the participation of the State in efficiency-seeking FDI in high value-added segments the economy and enable private investment in key and increase exports of specific agricultural products. sectors. FIAS Leverage FIAS Leverage In Senegal, the MCPAT module has supported a In Mexico, the application of the subnational MCPAT to series of policy operations that aim at regulatory all 32 states was completed in FY18. The government reform and enabling digital economic development. of Mexico passed a regulatory improvement law that Internet penetration in Senegal remains relatively established a permanent program with the Regulatory low, trailing Côte d’Ivoire, Ghana, and Kenya among Improvement Agency to apply MCPAT to all subnational others. Fixed broadband subscriptions are below regulation. This experience is informing further reform 1 percent of the population. International internet programs at the national or subnational level in bandwidth per Internet user is less than one tenth Colombia, Kenya, and Peru. Finally, tools developed of the average for Africa, affecting the quality of with FIAS support and based on the MCPAT are shaping connectivity. While 32 African countries have already an innovative exercise by IFC to bring about priority developed next-generation 4G networks, Senegal is reforms that open and create markets in developing still awaiting the full development of its 4G network. countries. IFC is conducting Country Private Sector The MCPAT analysis motivated the government to Diagnostics (CPSDs) to derive actionable reform issue 4G licenses and improve spectrum management priorities for countries to leverage private sector for and pricing. MCP has also provided inputs to the Bank development. MCPAT tools are systematically applied Group’s Systematic Country Diagnostics in Argentina, in all of these. They include comprehensive terms Armenia, Djibouti, Ecuador, Kenya, Paraguay, and of reference with detailed guidance material in the South Africa. In South Africa, three MCPAT-based annexes, checklists to assess economy-wide and sector- analyses identified a lack of competition as one of based barriers to competition, and targeted checklists five key binding constraints. This has led to a four-year on SOEs and politically connected firms. MCPAT is program of IFC Advisory Services support for opening informing 22 IFC Advisory Services projects with a markets and boosting competition launched in late competition component, nine of which are benefitting 2017 . IDA countries. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 48 Pillar 2 Agribusiness Initiatives Combine Global Expertise sector. The scope of the project is now expanding to assist with Hands-On Interventions women entrepreneurs regardless of sector to enable women to engage in higher value activities and improve The FIAS-supported Global Agribusiness project works links to producers and new markets, and thus generate with client governments to deliver public sector reforms better incomes. Through initial analytical work, the project that address barriers to private sector investment in the showed that the major constraint that women face has agribusiness sector, thereby providing a foundation for less to do with regulatory obstacles for women than a lack delivery on the upstream reform elements of IFC’s Creating of entrepreneurial experience. The project, therefore, will Markets agenda. A main pillar of support revolves around focus on building the capacity of women entrepreneurs in country-level diagnostics, called agribusiness deep dives, all phases of business development. The project works with that help client governments understand their competitive the Armenian Young Women’s Association to train women position and inclusive growth options in agribusiness and in better business practices. It also has engaged with the map out the constraints and opportunities for private sector government to establish a gender-sensitized public-private investment. The rigorous two-phase approach is being dialogue mechanism. The project has conducted three adopted across the Bank and has led to an increasing in-depth value-chain analyses using a newly-developed number of collaborative projects, including an initiative methodology and established collaboration with projects in launched in FY18 in the Republic of Congo. The deep dive Azerbaijan, Georgia, and the Kyrgyz Republic to share methodology has been adapted to meet the specific needs experiences and tools on integrating gender interventions of IFC as part of the new CPSD process. Agribusiness deep into sector-based projects. In FY18 a report was published dives have been recently carried out in Ghana, Guinea, on results of the value-chain analysis. Project activities are Kenya, and Rwanda in Sub-Saharan Africa, in Nepal in South expanding and deepening with financing from a variety of Asia, and in Nicaragua in Latin America. other sources. In June 2018, the project piloted new trainings The global agribusiness project also develops, delivers, and for women in rural areas in four sessions serving about 75 disseminates high quality, practical knowledge products that participants from different villages and communities in the educate and apprise the Bank Group and key stakeholders Tavush and Lori regions. The training presented the success globally on best practices in agribusiness development. The story of a woman in the Kyrgyz Republic who worked in development of these knowledge products both informs, handcrafts as a hobby but worked with the government to and is informed, by the work undertaken supporting Bank push for development of a sector strategy. Group programs and projects. The Seeds for All Toolkit Warehouse Receipts in Africa aims to establish an improved baseline understanding of seeds policy and regulatory reforms around the world, while The FIAS has supported design and implementation of seeking to advance the knowledge and understanding of reforms in Sub-Saharan Africa that have improved access critical subjects under debate within this field. A regional to credit and professional storage services for producers, dissemination workshop brought together about a hundred traders, and processors in agribusiness value chains through participants drawn from the Vietnam Ministry of Agriculture implementation of a warehouse receipts system (WRS). and Rural Development and private sector and agricultural The work has generated benefits in Côte d’Ivoire, Ethiopia, policy makers from Cambodia, Laos, and Myanmar. A Ghana, Kenya, Malawi, Niger, Senegal, and Tanzania. A holistic and comprehensive set of agribusiness gender new regional project on warehouse receipt financing in West guidelines have been disseminated to help incorporate Africa was launched in December 2018 and extends EFI’s gender elements into Bank Group agribusiness projects. A footprint on warehouse receipts work to countries such as new gender project launched in Armenia, for example, has Burkina Faso and Mali, among others. Warehouse Receipts directly benefited from the guidelines. A new diagnostic projects in Kenya and Malawi have already resulted in close toolkit for promoting SME growth in Agribusiness to $49 million in loans against receipts, with hundreds of provides a systematic approach for the identification and thousands of farmers reached, according to project data. assessment of opportunities and challenges for growth- In addition, there is evidence of sharp decreases in post- oriented agribusiness SMEs, including agro-processing harvest losses in Kenya—from 30 percent in government- SMEs and related service providers such as SMEs that run warehouses to 0.2 percent in WRS-linked warehouses. provide transport, storage, and packaging services. Such The WRS law passed in Côte d’Ivoire in 2015 was a first high-growth agribusinesses offer the greatest potential for for francophone Africa, while the WRS Law in Senegal creating jobs in rural areas and adding value to agricultural closely followed in 2017. Close to $16 million in loans have products. This diagnostic tool has been piloted in the been facilitated for Ivoirian cashew processors thanks to Democratic Republic of Congo, Nepal, and Sierra Leone. effective collaboration with the Agriculture Global Practice and with IFC’s Financial Institutions Group (FIG) and its Global Implementation of the FIAS-supported Armenia gender Warehouse Finance Program (GWFP). project got under way in September 2017 as an effort to support women entrepreneurs engaged in the wild harvest FIAS 2018 Annual Review 49 Country Private Sector Diagnostics (CPSDs) conducted by IFC and utilizing deep dive methodologies have recently been carried out in the Agribusiness sector in Kenya, as well as other countries in SSA, in LAC and South Asia. $49m Warehouse Receipts projects in Kenya and Malawi have already resulted in close to $49 million in loans against receipts, with hundreds of thousands of farmers reached, according to project data. Only 0.2% There were sharp decreases in post-harvest losses in Kenya— from 30 percent in government- run warehouses to 0.2 percent in WRS-linked warehouses. Coffee production in Kenya. Photo: World Bank Group FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 50 Pillar 2 Food Safety in Ukraine FIAS-supported Global Agribusiness 80% increase Since 2012, the FIAS-supported Global Agribusiness project has helped advise the government of Ukraine on legal and regulatory reforms to food safety systems, creating new markets for poultry and dairy producers in Ukraine, and enabling them to access European Union markets for the first time. In the poultry sector, the first round of reforms led to an 80 percent annual increase in Ukrainian in Ukrainian poultry exports annually poultry exports and opened new investment opportunities, including a $250 million commitment by an IFC client to In Ukraine, legal and regulatory reforms created new expand poultry production, according to project estimates. markets for poultry and dairy producers, enabling them to In the dairy sector, the work has generated an estimated access European Union markets for the first time. In the $160 million in annual compliance cost savings for Ukraine’s poultry sector, the first round of reforms led to an 80 dairy producers, as well as creating new export markets for percent annual increase in Ukrainian poultry exports. Ukraine to both the EU and China. Ukraine was also able to export frozen beef to China. In December 2017, Saudi Arabia opened its market to over eighty types of Ukrainian food products, both processed and non-processed, while Turkey $160 million started to accept Ukrainian beef in 2018. Less than a year after opening, agri-food exports to Saudi Arabia yielded additional $46 million to the Ukrainian economy. The work delivered much-needed expertise in collaboration with the Food Safety Agency and private sector to diversify markets by providing guidance on issues related to sanitary and in annual compliance cost savings in the Ukrainian phytosanitary requirements of relevant trading partners dairy sector and by facilitating trainings of potential beef exporters and food safety agency inspections employees by competent authorities of potential importers. In the Ukraine dairy sector, the work has generated an Streamlining Regulations for Agribusiness estimated $160 million in annual compliance cost savings in Central America for Ukraine’s dairy producers, as well as creating new export markets for Ukraine to both the EU and China. Although trade projects are now supported by other trust funds, some trade projects that date back to the previous strategy cycle continue to produce strong results. The FIAS-supported Central America Regional Agribusiness Trade Logistics project, launched in 2013 and concluding in June 2019, aims to streamline, harmonize, and automate procedures for sanitary registration for comparative analysis highlights three pillars critical to the processed food beverages in Costa Rica, El Salvador, future success of tourism in India: institutional coordination Guatemala, Honduras, Nicaragua, and Panama. Lengthy and focus, business environment and firm capabilities, and registration procedures for processed food and beverages sustainable and inclusive destination management. in Central America hampers regional trade. Streamlining these procedures, for example, in the processed food Support from FIAS enabled the implementation of four and beverages sector, could boost entrepreneurship and innovative pilot projects designed to examine the potential productivity, create jobs, enlarge the regional market, and of digital platforms such as Airbnb to empower women in make the region a more attractive investment destination. marginalized communities through tourism. The pilots built upon analytical work undertaken by EFI on tourism and the Tourism Sector Important to Shared Prosperity sharing economy and aimed to improve access to markets The FIAS-funded research on tourism in India marks the first for women entrepreneurs in specific communities. They took time the World Bank Group has developed a country-wide place through existing IFC and World Bank operations in strategy document for tourism in the country. It provides the India, Jamaica, and Peru, and an Airbnb pilot in Cape Town, India country office with a strategic and private sector-driven South Africa. Key findings and areas for future work include framework on which to build state-level actions. The strategy the need to assist clients on the regulatory framework, identified the huge and growing demand for tourism in upskilling of co-hosts to assist those without digital skills, and India and measures India’s performance against four global the ability of the platforms to assist with rural and product benchmarks—China, Indonesia, Mexico, and Thailand. The diversification. FIAS 2018 Annual Review 51 Brihadishvara Temple, a Hindu temple in Thanjavur, Tamil Nadu, India. Photo: World Bank Group FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 52 Pillar 3 Increase Firm-Level Competitiveness Under Strategic Pillar 3, FIAS supports work with clients to develop more productive and competitive firms that can seize opportunities in local, regional and global markets, and drive economic growth. The work in this area supports economy-wide and market-level reforms by helping clients develop policies that help businesses invest in improved products, use climate- efficient technologies, modernize production processes, and enhance worker skills. Like much of the work of the global practices, initiatives that advance Pillar 3 touch on multiple themes and regions. Skills for Competitiveness between demand and supply with investor and stakeholder consultations to create a strong fact base for intervention A skills assessment piloted in Moldova has yielded results design and action planning. Considering mediating factors used to design an IFC Advisory Services project and and addressing specific market failures, country-specific provide critical input into a Work Bank lending project. (See action plans typically entail four fields of action: (1) creating Publications list for more on the report and findings of the an enabling policy environment that minimizes distortions; assessment.) The Skills Diagnostic also includes practical (2) developing a strategy to attract FDI to fill supply chain applications of intervention modalities in the form of case gaps; (3) deploying information and matchmaking services studies and covers interventions by the World Bank Group for linkages; and (4) upgrading the local capabilities of firms and other organizations in both developing and developed and workforce to meet the standards necessary to compete economies. In partnership with DFID’s Business Environment internationally. Reform Facility (BERF), a set of Evidence and Learning Notes is being produced to illustrate what works and what does not work in Skills for Competitiveness and why. The notes will look specifically at evidence developed from skills projects as stand-alone programs or program components, which might include support to a wider business environment reform, investment climate, or growth program; as part of a program to enhance SMEs; or skills as a catalyst to boost value chain linkages. FDI Linkages: Fostering Technology Transfer and Value Addition Foreign direct investment (FDI) can be a powerful tool for host countries and their firms to integrate to new markets, foster diversification of production, and increase productivity. The Multinational Enterprises Linkages Product Development Project (MNE Linkages PDP) is developing an actionable set of tools that helps clients increase the volume and value of linkages established between FDI and local firms and maximize technology and knowledge transfers from FDI. This is one of the important ways in which greater domestic value-added is generated. The approach is strongly demand-driven and grounded in a realistic understanding of the opportunities and market constraints that often limit beneficial spillover effects arising from FDI in developing countries. During FY18 the project focused on relevant research, designing analytical tools, and rolling out a growing portfolio of FDI linkages pilot projects around the world, for example, in Cambodia, Jordan, the Philippines, Turkey, and Vietnam. These Customers dining at a restaurant in Amman, Jordan. pilots combine a diagnostic assessment of the gap Photo: Bigstock FIAS 2018 Annual Review 53 FIAS Leverage Investments and Reform Work in Jordan Despite recent reforms in Jordan, the institutional and legal framework for investment attraction and retention remains weak, destabilizing FDI flows into the country. The Jordan Investment Policy and Promotion project seeks to improve investment attractiveness, competitiveness, and sustainability of the Jordanian economy by assisting the Jordan Investment Commission (JIC) in improving its capacity and ability to attract and support investors. The FIAS- supported Jordan Inspection Reform II project supports the government in developing an efficient and effective inspection system that will enhance the competitiveness of the private sector while safeguarding the public interest. Among other objectives, the project seeks to minimize uncertainty and risk for businesses; provide online feedback mechanisms to gather feedback from the private sector on service delivery by inspectorates; deliver cost savings to the private sector through streamlined procedures and improved service delivery; and increase private sector compliance with relevant regulations. In FY18, Jordan achieved two reforms with the help of FIAS-supported projects. The Joint Global Practices conducted a detailed legal analysis of investment incentives and created an online portal with information on all existing investment incentives in Jordan, responsible agencies, and references to relevant laws. The publicly available database increased the transparency of the incentives regime, reduced the possibility for discretionary decisions by government agencies, and provided the government with an instrument for investment promotion and subsequent cost-benefit analysis. The investment policy and promotion reform stemmed from assistance provided to the JIC. The Commission was established as the sole agency for investment policy and promotion, replacing an ad hoc system in which different entities had authority over free zones and industrial estates. The project supported development of JIC’s capacity as lead investment promotion agency and equipped it with the tools and resources to attract, retain, and support investors. These two FIAS-supported projects are designed to supplement and support the World Bank Group lending program Economic Opportunities for Jordanians and Syrian Refugees Program for Results, for which the technical advisory was delivered. The $249 million project is helping Jordan address the severe challenges stemming from the war in neighboring Syria and the resulting refugee flows into Jordan. The holistic approach seeks to help improve the livelihoods of refugees in Jordan while also improving the economic prospects of host communities. Stimulating greater private investment in Jordan and enabling greater export of goods from Jordan—goals directly supported by the FIAS initiatives—are key components of the Program for Results. A parallel initiative, the Jordan First Equitable Growth & Job Creation Programmatic Development Policy Financing, is designed to help Jordan lay the foundation for higher and more sustainable economic growth and job creation. The $500 million initiative is part of the comprehensive Bank Group response to the economic and social pressures imposed on Jordan by the Syrian conflict. FIAS is supporting the comprehensive Bank Group response to the economic and social pressures imposed on Jordan by the Syrian conflict, and Jordan achieved two reforms with the help of FIAS-supported projects. $249m $500 m The World Bank's lending program This $500 million World Bank initiative, Economic Opportunities for Jordanians Jordan First Equitable Growth & Job and Syrian Refugees Program for Creation Programmatic Development Results, for which the technical advisory Policy Financing, is designed to help was delivered by FIAS, is helping Jordan Jordan lay the foundation for higher and address the severe challenges stemming more sustainable economic growth and from the war in neighboring Syria and the job creation. resulting refugee flows into Jordan. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 54 Pillar 3 Creating a Market for Energy-Efficient Fans in Punjab that would qualify for the energy efficiency label. The public procurement campaign led to sales of an additional 60,000 Electric fans in Pakistan account for one–third of the fans on the private market. In this single project, the FIAS- country’s domestic electricity consumption in a power sector supported effort touched on several priority themes for the stressed by high demand and frequent outages. Virtually World Bank Group: all the fans produced in Pakistan are made in Punjab, the country’s most populous province, and with more than four > Climate change and energy efficiency million fans sold annually, the electric fan manufacturing market represents a significant part of the manufacturing > Access to reliable power sector. A FIAS-supported project that closed in December > Enhancement of important manufacturing sectors 2017 has helped local manufacturers adopt standards for more efficient fans and raised consumer awareness of the > Development projects that engage regional as well quality and value of energy-efficient fans. The project, winner as national governments of an EFI FY18 Vice Presidential Unit Award, engaged > Creating markets for new and improved products with manufacturers and regulators to help leverage public financing in a standards and labeling program. This was > Public-private dialogue and engagement with the coupled with a government-sponsored and coordinated private sector awareness-raising campaign and a program to replace old Critically, the project has catalyzed interest in developing fans with energy-efficient ones in public buildings to kick- similar programs in Sindh and other Pakistani provinces. By start manufacture of more efficient fans. 2020, wider use of energy efficient fans is expected to save Quick action by the Bank Group and the regional 300,000 MWh—a 60 MW reduction in peak load—and $150 government led to a procurement initiative to install 90,000 million in energy costs. A recently launched Bank Group energy-efficient fans in schools and public buildings. This video highlights the significance of this intervention. The sparked interest in the private sector and helped convince project was recognized with an EFI FY18 Vice Presidential manufacturers of the wisdom of shifting production to fans Unit Award. Workers building energy efficient fans at a small factory in Punjab, Pakistan. Photo: World Bank Group FIAS 2018 Annual Review 55 Investments and Reform Work in Vietnam Vietnam needs a private sector that is more investment policy and business regulatory measures. competitive, innovative, and capable of joining and Ultimately, the project seeks to help Vietnam moving up global value chains (GVCs). The country’s expand the integration of local small and medium strategy of outward-oriented development has resulted enterprises into GVCs and increase overall domestic in large gains from external trade and a surge in FDI, all value addition. The project includes a pilot Supplier contributing to substantial economic growth. In recent Development Program helping suppliers in the years, however, growth has slowed and challenges automotive, electronics, and household appliances are emerging. Sustaining high growth will require sectors meet the production requirements of increased productivity. New measures are needed to multinational enterprises. Eight major MNEs—Bosch, enhance private sector competitiveness and create Canon, Datalogic, Denso, Ford, General Electric, an enabling environment that eases the cost of doing Panasonic, and Toyota—volunteered to guide an business and strengthens the linkages between upgrading process for 45 Vietnamese suppliers that foreign and domestic firms to benefit from technology have demonstrated ambition and complied with a set transfer. of selection criteria. If the upgrading is successful, MNEs are expected to provide business opportunities The FIAS-supported Vietnam Private Sector to participating suppliers. As part of the program, Competitiveness project seeks to improve the local business consultants and staff of the newly regulatory and business environment and enhance established Vietnam Industry Agency are being trained the ability of domestic suppliers to participate in value to replicate this approach in other sectors. chains in targeted sectors. This is to be achieved by development of next-generation FDI policies, A young lady working in a rice paper factory in Can Tho, Vietnam. Photo: Bigstock FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 56 Pillar 3 Creative Industries in the Digital Era The FIAS-funded Managing for Growth and Inclusion Report, and administrative infrastructure to assure the quality of scheduled for publication in FY19, demonstrates how small products and services. This is particularly important in firms in the fashion and home accessories export industries meeting international standards. In Nigeria, among other in Cambodia, Kenya, Morocco, Peru, and Sri Lanka countries, the Bank Group is jointly helping implement achieved moderate to high levels of growth. This report, QI reforms through projects aimed at easing access part of the FIAS-supported Creative Industries Product for domestic producers to external markets. This is Development Project, now completed, points to the accomplished by enabling the needed supply of quality importance of export aggregator firms. These firms, which services as well as by building institutional capacity and network anywhere from 150 to 2,500 micro-entrepreneurs in introducing modern regulations. The objective of QI is to one country, are taking on many more value chain functions develop a consistent World Bank Group offering based on than conventional fashion and home accessories firms. They in-depth analysis of existing knowledge and expertise in the can fulfill management functions smartly and take advantage field. Client countries that apply the QI reform toolkit are of the digital and business environment and the innovation better positioned to accomplish several key development ecosystem. Exposure to international markets through objectives: aggregator firms allows artisan micro-entrepreneurs to build their human capital, keep up with trends in design, business > Enhanced trade opportunities through the removal of management, and IT, and benefit from aggregator financing. unnecessary non-tariff technical barriers. They can focus on these tasks while the aggregator firms > Harmonization of technical regulations and handle organizational, logistical, and customer service recognition of conformity assessments of trade functions. partners. > Better integration into global value chains. Quality Infrastructure FIAS support for Quality Infrastructure (QI) helps > Greater incentive to encourage innovative products countries and business sectors develop the technical for market entry. Artisan painting ceramics in Cambodia. Photo: Artisans d'Angkor FIAS 2018 Annual Review 57 Belarus National Quality Infrastructure Related to the efficiency of inspection systems, ComPEL ’s ongoing impact evaluations in Kenya and Peru advanced A recently-completed project in Belarus, with FIAS considerably during FY18. In Kenya, the implementation of support from Austria, addressed regulatory constraints the interventions to be evaluated concluded in December hindering growth of the country’s micro, small, and 2017 , and the field work to collect follow-up survey data medium enterprises (MSMEs) and worked to increase the for the impact evaluation is near completion. In Peru, international competitiveness of the private sector. The the government passed a new regulation for inspections project helped in the development and implementation in January 2018, and impact evaluation activities were of the country’s MSME strategy and worked to reduce resumed. Research shared with the government included the administrative burden of regulations and the an analysis of administrative data showing that about 60 unequal treatment of private businesses as compared percent of businesses in the sample do not comply with to the state-owned enterprises. A key part of the effort minimum building safety standards against the risks of fire involved improving effectiveness of the national quality or collapse. Also, they are advancing in the establishment of infrastructure (NQI), which entails the technical and electronic inspections within the information and monitoring administrative infrastructure countries and business sectors system being developed, to bring transparency, improve the need to assure the quality of their products and services. efficiency of the governance arrangements, and generate The project also sought to address the implementation administrative data. gap between the good intentions of reforms and their implementation on the ground. In the final months of 2017 , the President signed a series of decrees that effectively implemented the key liberalization provisions. These included a notification mechanism covering 19 types of economic activity. Through a one-stop-shop or electronic services portal, a business entity can notify the relevant local executive body and obtain the right to begin operations the following day. The decrees also simplified fire safety and sanitary rules, environmental protections, and veterinary requirements. A huge body of rules in these four areas—some dating back to the Soviet era—has been reduced to documents ranging in length from 5 to 11 pages. Belarus’s strategy for SME development through 2030 is going forward under the slogan, “Belarus is a country of successful entrepreneurship. ” ComPEL Advances Bank Group Work on High-Growth Firms Agenda The FIAS-supported Competitiveness Policy Evaluation Lab (ComPEL), successor to the Impact Program, is conducting ongoing impact evaluations in Georgia and Mexico on targeting firms with high growth potential. In FY18 the project completed collection of baseline survey data and conducted analyses of administrative data. In Mexico, the objective is to assess the value-added of government and private sector scoring methods for allocating innovation grants to SMEs. In Georgia, the objective is to assess the effects of providing SME support for technology adoption based on performance benchmarks. Understanding the effects of technology adoption can be key to informing business support programs. A systematic review on interventions that promote technology adoption in firms was advanced by ComPEL with outcomes published in a protocol. The effort is complemented by the World Bank’s development of a firm-level questionnaire to measure technology adoption that will be piloted in three countries and lead to a flagship report. Together, these diagnostics and tools are expected to inform projects and a new cluster of impact evaluations in this topic. Loan officer, Kenya. Photo: Flore de Preneuf/ World Bank FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 58 04 FIAS-funded work under the three strategic pillars supported global, regional, and country- Work in Programmatic Themes specific initiatives under programmatic themes. The FIAS FY17–21 strategy identifies these as Gender; Transparency, Political Economy, and Sustainability of Reforms; Green Competitiveness; and Targeting High-Growth Business. This chapter outlines the overarching approach to this thematic work while country-specific narratives touching on these themes are found in Chapter 3. This chapter also summarizes work in monitoring and evaluation (M&E), knowledge management (KM), and communications and provides a partial listing of team awards. FIAS-supported Gender The FIAS-supported Gender Team continued to advance progress on gender-related issues within private sector development in FY18. As of FY19, its reach has expanded to encompass the entire EFI Gender Practice Group. To prioritize and focus deliverables, the FIAS-supported Gender Team developed a Gender note guiding team structure and activities. The Gender Team now provides support across EFI’s four Global Practices, ensuring that progress is made on women’s access to jobs and assets and that there are improvements with respect to women’s voice and agency. The Gender Team worked to strengthen and enhance the emphasis Transparency, Political on tracking the range and quality of gender-related Economy, Sustainability project activities. As one key result of this effort, of Reforms EFI met and exceeded its primary gender-related corporate target for percentage of projects that are gender tagged. As of June 30, 2018, 40 percent of projects were gender tagged as compared to the target of 33 percent. Substantively, the team primarily focused on two main objectives: 1) supporting staff across EFI Green Competitiveness in improving gender outcomes in projects and analytical work; and 2) supporting the set-up and design of projects for which the World Bank received funding from the Women Entrepreneurs Finance Initiative (We-Fi). This effort benefited from prior analytical and project-implementation expertise developed and disseminated among staff. The team continued to peer review a range of Targeting High-Growth analytical pieces and project documents with a view Business to including or enhancing gender angles; realigned gender guidance notes of various Global Practices to best fit into the EFI organizational structure; and served as the EFI gender focal point to the World FIAS 2018 Annual Review 59 Bank Gender Group and IFC’s Gender Secretariat. the set-up of online portals with property, tax, Through these activities, all the GPs gained regulatory, and other business-related information, access to critical information and input on gender, business and consumer surveys, and training disseminated through an expanded Gender and information workshops are among the tools Community of Practice (CoP). The team organized applied in this thematic area, as seen in many learning events and conducted personalized projects described in the preceding chapter. outreach to support individual projects and continued hosting gender events with relevance Green Competitiveness across multiple Global Practices. These included The second phase of the Climate Competitive a session on Designing for Impact and Results Industries global project continues through FY19 in Gender Projects, and a series of CoP learning with a strong track record to date and a focus lunches. Finally, the team contributed to producing on helping to mainstream climate action and country-level data and analysis related to women’s green competitiveness in the product offerings entrepreneurship in two analytical reports in supported by EFI and other Bank Group units. Bangladesh and Moldova. The project is part of the Bank Group’s overall prioritization of climate change mitigation and Transparency, Political Economy, and adaptation, including the goal of having 28 Sustainability of Reforms percent of all Bank Group activities include The FIAS FY17–21 strategy pulls together three climate change elements by 2020. Climate programmatic themes that are integrally related: competitive industries work seeks to integrate transparency, realized through simplified climate action into the competitiveness agenda in regulations and higher degrees of public the policy areas of industrial resource efficiency, disclosure, relates directly to the importance eco-industrial parks, and energy efficiency of recognizing the political economies of client standards and labeling. Several important tools countries when undertaking reform programs. Due and knowledge products developed under the attention to these concepts, in turn, contributes previous product development project (PDP), such significantly to whether reforms undertaken will be as the Green Incentive Toolkit, the Greener Path thoroughly implemented and sustained over time. to Competitiveness Report, and the Standards Public-private partnerships, public-private dialogue, and Labeling Toolkit, are being disseminated to Seamstresses working in Georgia clothing factory. Photo: Leonid Mujiri/World Bank FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 60 04 Bank Group teams and clients under the environment and limitations of their own current project. The project worked with the internal capabilities. SHGB reform therefore Global Facility for Disaster Risk and Recovery lies at the core of fostering business group to develop a joint proposal on resilient competitiveness, connecting them to global industries that has gained grant support and markets and generating more and better is preparing pilots in two countries. jobs in client countries. The PDP aims to fill knowledge gaps in identifying and scaling Climate Competitive Industries PDP Helps up successful policy interventions to support Define Eco-Industrial Parks high growth businesses. Through analysis An International Framework for Eco-Industrial and research, the PDP is contributing to Parks, jointly published in December the design of policy solutions that will allow 2017 by the Bank Group, UNIDO, and the for productive collaboration within the German Development Cooperation, GIZ, Bank Group and with other developmental (Deutsche Gesellschaft für Internationale partners. Zusammenarbeit GmbH) brings a unified and One of SHGB’s key objectives is to identify joint approach to more sustainable and eco- the impact of regulatory reforms that seek friendly industrial parks. Produced as part to facilitate firm entry (formalization) and of the FIAS-supported Climate Competitive growth. A Bank Group paper, Courts and Industries Product Development Project, the Business Registration: Evidence from Serbia, report offers a guide to policymakers and examines the effects of a reform in Serbia practitioners on the critical elements that that transferred business registration from will help governments and the private sector regional courts to a centralized agency. Using work together in establishing economically, administrative data, the analysis employed a socially, and environmentally sustainable eco- difference-in-difference strategy to compare industrial parks (EIPs). new firms before and after the reform across Targeting High-Growth Business districts based on the level of distrust in regional courts. The results suggest that the The overall objective of the Supporting High reform increased the number of new firms Growth Businesses (SHGB) program is to to a greater degree in regions with higher help governments boost the competitiveness initial levels of distrust, by up to 34 percent. of growth-oriented businesses. Solutions The reform also increased the survival rate of are provided at key stages of the business new firms. These effects are large compared lifecycle: at inception, by facilitating start- to those of other types of registration up or formalization; during operational reforms, suggesting that courts can pose upgrading, by strengthening internal significant barriers to new firm creation. capabilities through enhanced management skills; and in the business scale-up phase, by Monitoring & Evaluation, Impact connecting these businesses to lead firms in Client Satisfaction and Development value chains. The program will offer an array Effectiveness of policy interventions designed to either explicitly target high-growth businesses or FIAS-supported projects received a 100 to increase their uptake of economy-wide percent client satisfaction rating for FY18 reforms, hence enhancing the reforms (90 percent in FY17), with all 10 of the projects amplification effect. rated positively by clients. Over the first two years of the strategy cycle, 38 out of While the private sector is the main engine 41 projects, or 93 percent, received positive of economic growth, few firms achieve ratings. This is a strong measure of support high-growth and have a disproportionately from client governments. significant impact on competitiveness. The development of such firms is frequently Development effectiveness is an internal hindered by factors in the external Bank Group rating which measures FIAS 2018 Annual Review 61 project execution in the field against project objectives at the outset. For FY18, six completed projects were rated for development effectiveness: Competition Policy for Investment Climate and OHADA Uniform Acts Reform Phase 2 were rated “successful”; Investment Climate Rapid Response III was rated “mostly successful”. Two projects were rated “mostly unsuccessful”: East African Community Investment Climate Phase 2 and Nepal Investment Climate for Industry. E4E ICT Sector Egypt was rated “unsuccessful.” The EAC project succeeded in developing the East African Community Common Market Scorecard but other objectives were only partially achieved due to slower-than-anticipated uptake by the EAC Secretariat and partner states. The Scorecard has been highly influential in operationalizing the Common Market Protocol contributing to cross-border investments, harmonization of tax policies, and elimination of high regulatory costs and barriers to competition. The Nepal project helped the government implement a National Tourism Strategic Plan, streamlined licensing procedures and formalization for tourism-related businesses, and achieved business cost savings of an estimated $474,379. The mostly unsuccessful rating stemmed from the aftereffects of a major earthquake in 2015 and a blockade of the border with India which effectively shut down the economy for nearly a year. These events prevented achievement of key project goals on the original timeline. Nevertheless, following the earthquake the project helped expedite a structural survey showing that 80 percent of buildings along the popular Mount Everest trekking route were structurally sound, contributing to the rebound of the country’s crucial tourism industry. The Egypt project succeeded in supporting the design and development of a National Competence Framework for the ICT sector in Egypt and rolled it out on a pilot basis in two private universities and six private companies. The second component of the project—adoption and scale up of Nepali man does embroidery on clothes in a small workshop, in KTM, Nepal. the NCF—was dropped due to changing Photo: Bigstock government priorities. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 62 04 Knowledge Management, In partnership with the OECD, a Bank Group Publications and Learning effort supported by FIAS has developed Highlights new data on product market regulation (PMR) in Latin America. PMR indicators FIAS support is building knowledge, lessons assess the extent to which public policies learned, and valuable experience from global promote or inhibit markets and cover a research and from the field across the full wide range of topics, including electricity, range of activities covered by the FY17–21 gas, telecommunications, transport, water, strategy, from investment climate reform retail distribution, and professional services. and improvements in business environment The indicators are publicly available for 10 to investment policy and promotion and LAC countries (Brazil, Costa Rica, Chile, sector-specific work. The benefits accrue Colombia, the Dominican Republic, El not only to FIAS-supported client-facing Salvador, Honduras, Jamaica, Mexico, projects but to World Bank and IFC activities Nicaragua, Peru, and Uruguay). With PMR across the project spectrum; in some cases, data, the MCP project has been able to lessons and knowledge gained through this estimate the additional GDP growth that work benefit developed country economies. can be expected from structural reforms A list of selected EFI publications on a wide that expand market opportunities and range of topics related to FIAS-supported help reform champions advocate in favor work appears in Annex 3. of more effective competition policy. New PMR data and the MCPAT tools developed Global Knowledge Fostered by with support of FIAS also informed the 1st Competition Policy Work Joint IMF-OECD-World Bank Conference In FY18, FIAS-supported work in markets on Structural Reforms in June 2018 in and competition policy (MCP) leveraged Paris. The event, focused on product market strategic partnerships to generate and competition, regulation, and inclusive growth, exchange knowledge, and to provide marked the first time the three institutions coaching support for stakeholders to have collaborated to raise awareness among advocate for competition reforms. For the their member and client countries about fifth year in a row, the FIAS-supported the role of market-specific reforms for Competition Advocacy Contest showcased macroeconomic performance. successful competition advocacy strategies across countries and sectors. The contest In the fall of 2017 EFI launched the Global is hosted jointly by the Bank Group and the Investment Competitiveness Report International Competition Network (ICN), a 2018/2018: Foreign Investor Perspectives global network of competition authorities and Policy Perspectives. The launch included from more than 100 jurisdictions. This extensive external content, including blogs, a year the contest called for submissions of feature article, video, and major launch event stories from micro-reforms that mattered in Vienna. The report provided analytical for macro-variables and that had spillover insights and empirical evidence on foreign effects across the economy. The contest direct investment drivers and contributions selected successful cases of pro-competition to economic transformation and included reforms from among 50 applications a survey of 750 executives of multinational from developed and developing countries. corporations investing in developing Winning authorities from Argentina, Brazil, countries, extensive analysis of available Chile, Kenya, Malawi, Mexico, Serbia, and data and evidence, and a thorough review Russia tackled constraints to competition of international best practices in investment and expanded market opportunities in policy design and implementation. key sectors such as telecommunications, financial markets, cements, automotive and TCdata360, the external data aggregation lotteries. web site developed with FIAS support FIAS 2018 Annual Review 63 and promoted with the help of EFI fiscal year, TCdata360 had attracted 182,726 communications, is an example of how page-views and 56,653 unique visitors; thorough data collection and accessible 20 percent of users came from the United information presentation can benefit develop States, followed by United Kingdom, India, and developing countries alike. TCdata360 Spain, and Germany. In total, these countries achieved continued growth in users and represent 40 percent of the total users visits during FY18. Through the end of the during this period. Bharatpur, India. Photo: Bigstock FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 64 05 Activities covered in the FIAS 2018 Annual Review were co-financed via a set of FIAS trust funds. $31.6m Financial results reported in this section cover the funds managed under the FIAS trust fund structure as well as supplemental funds earmarked for the implementation of the FIAS FInancial Results strategy. These funds are provided by IFC and the World Bank for FIAS-related activities and total contributions from all sources to cover sustaining costs associated with the in FY18 management of FIAS. FIAS financial reports use cash-based reporting in alignment with the quarterly financial reports on IFC’s donor- $21.5m funded operations. Funding Core, Programmatic and Project-Specific Contributions In FY18 FIAS donors, clients, and the World and Resource Use total direct project expenditures Bank Group contributed a total of $31.6 million in FY18 (including trust fund administration fees of $0.835 million) to the various FIAS trust funds, supporting the implementation of a broad- $16.5m based investment climate reform effort under the FIAS Program. Contributions from IFC in the form of allocations from the Funding Mechanism for Technical Assistance and Advisory Services (FMTAAS) are treated as an additional source of funding for FIAS-related total client-facing project expenditures activities and are included in the total FY18 in FY18 FIAS contributions of $31.6 million (see details in Table 1: Sources and Uses of Funds). World Bank Group core contributions totaled $7.0 million in FY18, including $5.0 million from IFC and $2.0 million from the World Bank. In addition, IFC contributed $1.1 million from FMTAAS to support a range of global knowledge management and product design and development projects implemented under the FIAS umbrella. FIAS core funds supplement these global product activities. Aggregate FY18 World Bank Group contribution to FIAS is $8.1 million, or 25.6 percent of total FY18 FIAS contributions.6 FIAS 2018 Annual Review 65 Core contributions received from donors FIAS partners to be directly involved in the amounted to $5.6 million in FY18 ($4.6 program and establish direct connections million in FY17). While most donors who between their respective private sector supported FIAS during the FY12–16 strategy development programs and FIAS. cycle provided consent to roll over the unused portions (i.e., fund balances) of their FIAS expenditures in priority areas were in FY12–16 contributions to the new FY17–21 line with the FIAS FY17–21 strategy targets. funding cycle, core donor contributions are Of $16.5 million in client-facing project below expected fundraising targets. The total expenditures in FY18, 68 percent supported amount of core funding received in FY18 IDA borrowing countries, in line with the from the World Bank Group and donors strategy target of 70 percent; 47 percent amounted to approximately $12.6 million, was spent in Sub-Saharan Africa, in line with consisting of $5.6 million in contributions the target of 50 percent; and 31 percent from donors and $7.0 million from the World was spent in FCS, exceeding the target of Bank Group (or 56 percent of total core 25 percent (these figures add up to more contributions). than 100 percent because of the significant overlap between IDA, FCS, and Sub-Saharan Programmatic contributions from Africa). Among regions, the Middle East donors made available through thematic North Africa received the next largest share and regional FIAS Trust Funds totaled of client-facing expenditures with 21 percent, approximately $8.9 million in FY18. This followed by Europe and Central Asia at 14 significant decrease (55 percent) in FY18 percent; East Asia and Pacific and Latin programmatic contributions as compared to America and Caribbean with 7 percent each; FY17 ($16.0 million) is due in large part to the and South Asia at 2 percent. transfer of large programs such as tax and trade to other implementing Global Practices. Use of Funds In FY18, FIAS expenditures for investment In FY18, project-specific contributions from climate reform activities reached $27.4 donor partners amounted to $9.0 million, million. This represents a 77 percent rate of compared to $7.3 million in FY17, reflecting spend against the FY18 strategic spending strong donor interest in specific client-facing target of $35.7 million in the second year investment climate reform interventions of the FY17–21 funding cycle, and an 89 as well as the trend among some donors percent rate of spend against cash receipts to decentralize aid budgets to their local of $30.8 million for the year. While staff delegations or embassies. and consultant costs represent the largest The ability to generate client contributions share of total FY18 FIAS expenditures (52 remains a challenge that FIAS is seeking to and 32 percent, respectively), indirect costs address. (infrastructure, office occupancy, and other miscellaneous costs) remain relatively low at In-Kind Support Via Staff Exchanges and 5 percent (see Table 1, Sources and Uses of Secondments Funds). Throughout the previous strategy cycles $9.0m the FIAS program has benefited from in- kind resources that several donors have made available in the form of secondments and staff exchanges. In FY18, a senior staff member from the Korean Ministry of Trade, Investment, and Energy was seconded to work on FIAS-funded activities. Such staff In FY18, project-specific contributions from exchanges and secondments offer a way for donor partners amounted to $9.0 million 6 Annual contributions from the World Bank are treated in the same manner as core donor funds and are co-mingled with other donor funds in the FIAS Parent Trust Fund account, as terms and conditions allow. Annual contributions from IFC are received as a direct contribution to a FIAS-dedicated trust fund and in the form of regular administrative budget to cover sustaining costs associated with the management of FIAS. Together they comprise IFC’s annual contribution to the FIAS FY17–21 strategy cycle. Contributions received from IFC in the form of allocations from the Funding Mechanism for Technical Assistance and Advisory Services (FMTAAS) are treated as an additional source of funding for FIAS-related activities. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 66 05 Financial Results 2018 Direct project expenditures for FY18, including client-facing projects and global programs, were $21.5 million, or 79 percent of total FY18 expenditures of $27.4 million. Of the $21.5 million in direct project expenditures, $16.5 million, or 77 percent, went to client-facing projects. In FY18, $5.7 million, or 21 percent of total FIAS expenditures, covered indirect project costs such as program management and operational support, including product development, M&E, knowledge sharing, donor relations, and other non-overhead costs; only 1 percent of total FIAS expenditures went toward general and administration costs. In accordance with IFC Advisory Services policy, general and administration costs such as office occupancy, communications and IT, equipment, etc. are accounted for as a direct cost to capture total project cost. In FY18 FIAS expenditures in priority areas were consistent with and, in the case of FCS, exceeded the strategic spending targets outlined in the FIAS FY17–21 strategy. Of the $16.5 million in client-facing project expenditures, 68 percent supported IDA borrowing countries; 47 percent went to projects in Sub-Saharan Africa; and 31 percent supported projects in FCS. Among regions, the Middle East North Africa received the next largest share of client-facing expenditures with 21 percent, followed by Europe and Central Asia at 14 percent; East Asia and Pacific and Latin America and Caribbean with 7 percent each; and South Asia at 2 percent. Administration fees are collected by IFC to cover trust fund administration costs and are deducted from donor contributions at the time of receipt. In FY18, IFC collected trust fund administration fees of $0.835 million from FIAS donor contributions.7 In FY18 FIAS received $30.8 million in cash receipts (net of administration fees) and expended $27.4 million for the same period, or 89 percent of total cash receipts. Similarly, in FY17 FIAS received $36.4 million and expended $32.9 million or 90 percent of total cash receipts. This reflects an annual rate of spend for the first two years of the cycle commensurate with annual donor contributions for the same two-year period. FY18 DONOR CONTRIBUTIONS FY18 FIAS EXPENDITURES (Gross Receipts) 100% = $27,396,345 100% = $31,619,399 n Client Facing (60%) n World Bank Group (25%) n Non-Client Facing (18%) n Core (18%) n General & Administrative (1%) n Programmatic (28%) n Program Management & n Project Specific (29%) Support (21%) PERCENT OF FY18 FIAS DIRECT CLIENT-FACING EXPENDITURES BY PROJECT EXPENDITURES REGION, FY18 100% = $21,506,948 100% = $16,530,313 n Client Facing (77%) n East Asia and Pacific (7%) n Non-Client Facing (23%) n Europe and Central Asia (14%) n Latin America and Caribbean (7%) n Middle East and North Africa (21%) n South Asia (2%) n Sub-Saharan Africa (47%) n World (3%) 7 FIAS trust funds are subject to the standard IFC trust fund administration fee of 5 percent. Trust fund administration fees collected by IFC are included in Table 1, Sources of Funds. FIAS 2018 Annual Review 67 Fundraising Update $152.5m Total secured contributions for the FY17-21 Strategy Cycle are at $152.5 million. This includes total signed contributions as well as very high probability pipeline, of which $65.5 million were received in FY17 and FY18 (see Table 1), and the remaining $87 will be disbursed by donors in the next years of the cycle. Fundraising results represents 76.1 percent of the $200 million fundraising target for the five-year strategy cycle. Out of this result: total secured contributions for the FY17-21 Strategy Cycle 1. $38.3 million are commitments from the World Bank Group and $114.2 million from donors, representing a 25/75 ratio, aligned with $38.3m the previous cycle. 2. $68.7 million are commitments to the Core TF and $83.8 are commitments to Programs and Project-specific TFs, representing a 45/55 ratio against the 53/47 ratio in the past cycle. 3. Average annual donor core contribution are $6.1 million. In the FY12–16 cycle, the average annual donor contribution was $9.5 in commitments from the World Bank Group million. and $114.2 million from donors Key Fundraising Messages $21.5m EFI Management remains committed to consolidating trust funds and once again encourages donors to make a portion of their contribution to FIAS available as core funding in support of the overall strategy, with the aim to reach a 50/50 ratio by the end of the Cycle. Development partners are increasingly pledging resources toward a specific set of activities covered in the FIAS agenda. FIAS core donor support provides the needed flexibility to allocate FIAS direct project expenditures for FY18 funds to support the implementation of FIAS strategic priorities in the for client-facing projects and global regions, including the ability to provide rapid response to emerging programs challenges faced by clients. In addition, core funding supports the design and development of global knowledge products which inform and facilitate the development of innovative client-facing solutions. EFI management welcomes a continued engagement with development partners on this matter. While overall fundraising results for the strategy cycle are strong, the pace of contributions for the first two years of the cycle as past FIAS supporters direct funding to other programs may make it difficult to achieve the $200 million fundraising target on which FIAS project-related targets (reforms and compliance cost savings) are based. Among the reasons for this are the overwhelming Bank Group emphasis throughout FY18 in the Capital Increase and IDA18 campaigns, which superseded fundraising activities at the level of individual trust funds. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 68 05 Financial Results 2018 Table 1: Sources and Uses of Funds – In US$ Thousands FY12–16 CYCLE FY17–21 CYCLE FY12–16 FY17 FY18 SOURCES OF FUNDS FUND BALANCE RECEIPTS RECEIPTS WORLD BANK GROUP CONTRIBUTIONS Core Contributions IFC 1 23,388,000 2,003,875 5,000,000 5,000,000 IBRD 8,000,000 1,221,162 2,000,000 2,000,000 MIGA 6,400,000 Subtotal Core Contributions 37,788,000 3,225,037 7,000,000 7,000,000 Project-Specific and Other Contributions 2 IFC AS - Other Contributions - Project-Specific 9,939,000 1,882,864 267,657 IFC AS - Other Contributions - Business Development 478,000 IFC AS - Other Contributions - Administration 3,132,000 716,477 794,113 Subtotal Project Specific and Other 13,549,000 - 2,599,341 1,061,770 Contributions Subtotal World Bank Group Contributions 51,337,000 3,225,037 9,599,341 8,061,770 CORE DONOR CONTRIBUTIONS Austria 3,205,000 463,349 1,045,800 Canada 17,377,000 2,354,970 Ireland 1,186,000 224,319 632,130 716,940 Luxembourg 2,250,000 355,090 673,890 1,453,422 Netherlands (Global Program) 2,620,000 - 1,000,000 1,000,000 Norway 3,843,000 576,550 Sweden 7,063,000 988,405 1,200,480 Switzerland 1,500,000 1,316,406 1,250,000 1,250,000 United Kingdom 8,472,000 - Subtotal Core Donor Contributions 47,516,000 6,279,089 4,601,820 5,620,842 PROGRAMMATIC DONOR CONTRIBUTIONS Austria (IC Cooperation Program) 11,368,000 2,783,512 3,137,400 1,779,900 Australia (Investment Policy and Promotion) 1,449,000 681,147 712,073 EU (ECOWAS Investment Policy) 5,330,000 1,543,029 3,457,608 EU (Western Balkans Investment Policy and Promotion) 1,426,813 EU (Investment Policy and Promotion) 209,080 595,095 Ireland (Africa) 2,876,835 - Korea (Industry) 125,000 - Switzerland (Industry) 2,000,000 - - Switzerland (MCICP) 6,000,000 3,100,000 United Kingdom (BEED) 1,212,355 2,493,429 669,829 United Kingdom (SIRMs) 1,309.250 United States (Doing Business) 2,160,000 - - Subtotal Programmatic Donor Contributions 25,308,835 6,220,043 16,009,590 8,880,887 EXITED/EXITING PRODUCT LINES Australia (Trade Facilitation) 3,217,000 Canada (Trade Facilitation) 1,821,000 EU (ECOWAS Trade Logistics) 2,423,000 EU (Trade Facilitation) 4,338,000 Korea (Trade Logistics) 550,000 Luxembourg (Tax Transparency) 989,000 Netherlands (Investing Across Borders) 200,000 Netherlands (Tax Transparency) 300,000 Norway (Trade Facilitation) 5,504,000 Norway (Trade Logistics) 1,000,000 Switzerland (Tax Transparency) 3,100,000 Switzerland (Tax) 2,500,000 Switzerland (Trade Facilitation) 1,300,000 United Kingdom (Tax Transparency) 2,133,000 United Kingdom (Trade Facilitation) 754,000 Subtotal Exiting Product Lines 30,129,000 - - - FIAS 2018 Annual Review 69 Table 1: Sources and Uses of Fundsa – In US$ Thousands (continued) FY12–16 CYCLE FY17–21 CYCLE FY12–16 FY17 FY18 SOURCES OF FUNDS FUND BALANCE RECEIPTS RECEIPTS PROJECT SPECIFIC DONOR CONTRIBUTIONS European Commission 2,318,000 - - France 4,960,000 1,246,430 1,044,950 1,185,650 Gates Foundation 2,742,000 2,069,253 - 900,000 Kauffman Foundation 211,000 - Korea 200,000 - Trade MDTF 225,000 - Trademark East Africa 10,665,000 673,943 USAID Legacy 10,205,000 1,334,850 1,424,353 USAID New 2,505,804 4,869,485 6,970,250 Subtotal Project Specific Donor Contributions 31,526,000 7,830,280 7,338,788 9,055,900 TOTAL WBG AND DONOR CONTRIBUTIONS 185,816,835 23,554,449 37,549,539 31,619,399 CLIENT CONTRIBUTIONS 699,000 TOTAL RECEIPTS 186,515,835 23,554,449 37,549,539 31,619,399 Trust Fund Administrative Fees 3 7,151,000 1,099,899 834,799 TOTAL (NET) RECEIPTS 179,364,835 23,554,449 36,449,640 30,784,600 FY12–16 FY12–16 FY17 FY17 FY18 FY18 $ % $ % $ % USES OF FUNDS4 Staff 80,745,922 50% 15,724,142 48% 14,114,087 52% Consultants and Temporaries 41,145,014 26% 10,503,071 32% 8,768,926 32% Travel 26,315,588 16% 5,053,184 15% 3,006,936 11% Indirect Costs 11,886,379 7% 1,604,318 5% 1,506,396 5% TOTAL USES OF FUNDS 160,092,902 100% 32,884,715 100% 27,396,345 100% 1 Annual contributions from IFC are received as a direct contribution to a FIAS-dedicated trust fund account and in the form of Advisory Services (AS) administrative budget to cover staff costs of a number of mainstreamed positions related to FIAS. In FY17 and FY18 IFC's annual contribution to the FIAS FY17-21 funding cycle is $5.0 million, $2.0 million as a direct trust fund contribution and $3.0 million as AS administrative budget. 2 Contributions received from IFC in the form of allocations from the Funding Mechanism for Technical Assistance and Advisory Services (FMTAAS) are treated as an additional source of funding for FIAS-related activities. 3 Administration fees collected by IFC to cover the cost of trust fund administration. 4 Uses of Funds table includes expenditures from all sources of funds that support the FIAS FY17-21 strategic agenda. FIAS FY12-16 funding cycle expenditures (previously reported) have been adjusted for comparative purposes. Table 2: Expenditures by Advisory Services (AS) Activity FY12–16 % FY12–16 FY17 % FY17 FY18 % FY18 STANDARD AS ACTIVITY EXPENDITURES ACTUAL ACTUAL ACTUAL ACTUAL ACTUAL ACTUAL PROJECT RELATED EXPENDITURES of which: Direct Project Expenditures 1 113,898,894 71% 26,055,015 79% 21,506,948 79% of which: Indirect Project Expenditures 2 38,121,978 24% 6,398,555 19% 5,748,206 19% TOTAL PROJECT RELATED EXPENDITURES 152,020,872 95% 32,453,570 99% 27,255,154 99% GENERAL & ADMINISTRATION COSTS 3 8,072,031 5% 431,145 1% 141,191 1% TOTAL STANDARD AS ACTIVITY EXPENDITURES 160,092,902 100% 32,884,715 100% 27,396,345 100% 1 Direct Project Expenditures include project preparation, implementation and supervision costs. 2 Indirect Project Expenditures include program management and operational support costs, i.e., product development, M&E, knowledge sharing & staff development, donor relations, public relations and other non-overhead costs such as administrative and back-office support staff. 3 General & Administration includes overheads such as rent, communications, equipment, etc. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 70 06 Annex 1 : FIAS REFORM TOTALS AND DESCRIPTIONS 1.1 FIAS FY17–21 Strategy Cycle Scorecard—Summary FY17–21 STRATEGIC Cumulative CUMULATIVE STRATEGY THEME INDICATOR FY12–16 FY17 FY18 FY19 FY20 FY21 FY17–21 TARGET Reform Totals 1. % of FIAS client-facing project FY18 Focus on Priority implementation spend in IDA 75% 70% 68% 69% 70% Clients countries % of FIAS client-facing project implementation spend in Sub- 55% 54% 47% 51% 50% Saharan Africa % of FIAS client-facing project 29% 28% 30% 29% 25% Reforms By implementation spend in FCS Region 2. Number of IC reforms supported 341 62 40% 102 275 Delivering by FIAS Significant % of IC reforms supported by FIAS Business Results in IDA countries 73% 58% 65% 61% 70% % of IC reforms supported by FIAS 30% 21% 25% 23% 25% in FCS countries % of IC reforms supported by FIAS Publications, 66% 32% 30% 31% 50% in Africa Events 3. Client satisfaction: FIAS-supported Client Satisfaction projects (results from IFC client 92% 90% 100% 93% 90% and Development survey) Effectiveness Development effectiveness: FIAS supported projects (% of projects 88% 100% 50% 63% 80% rated satisfactory in terms of Funding Received development effectiveness) Per Project 4. Direct Compliance Cost Savings $208M $8.7M $28M $36.7M $250M Measuring Impact Investment generated via facilitation of FDI in priority $1.59B $153.2M $33M $186.2M $1B sectors* Productivity** TBD Jobs** TBD Spending 5. IBRD and IFC investment Per Project Leverage operations informed and enabled TBD by FIAS** 11/15/18 * The $1 billion target for investment generated is derived using an improved methodology. Using the previous methodology, the comparable investment generated target would be $2 billion for Annexes FY17–21, or double the target of the previous cycle. ** Methodology for setting targets for these indicators to be developed during FY17–21 cycle. FIAS 2018 Annual Review 71 Annex 1 : FIAS REFORM TOTALS AND DESCRIPTIONS 1.2 Reforms and Results from FIAS-Funded Projects NUMBER OF DB COUNTRY REFORM TOPIC REFORM DESCRIPTION REFORMS VALIDATED AFRICA 12 Guinea Construction Guinea made dealing with construction permits less expensive and time consuming by reducing the cost 1 DB19 Permits and the time needed to obtain a building permit. A decree promulgated in March 2018 amended the fee schedule for building permits to reduce the cost and time required. The basic rate of a building permit for a building with a ground floor between 201 and 300 square meters is down slightly, to approximately $143, and the increase for each additional level has been reduced from 20 percent to 15 percent while the basic rate for each square meter has been reduced from 1 percent to 0.5 percent. Guinea Starting a Guinea made starting a business easier by allowing registration with the labor promotion agency at the 1 DB19 Business one-stop shop. The project team helped develop a single form for business registration at the single window of the Private Investment Promotion Agency, making it possible to register to the Guinean Agency for the Promotion of Employment while registering to other entities and obtaining a tax registration number from the National Tax Directorate in one streamlined procedure. Employee registrations can now be completed directly at the one-stop shop using the single form and without having to go to the labor promotion agency to notify the hiring of employees. This has reduced the time and number of procedures needed to start a business. The form is available online. Guinea Registering Guinea made property registration easier by reducing the property transfer fee. The project team has 1 DB19 Property helped update the country’s Doing Business plan and provided support for implementation of reforms, with a focus on business registration. Mali Enforcing Mali made enforcing contracts easier by adopting a law that regulates all aspects of mediation as an 1 DB19 Contracts alternative dispute resolution mechanism. A legal text review formed the basis for reorganization of the Commercial Court to improve handling of commercial litigation as well as the Court's overall service delivery. Mozambique Getting Mozambique reduced the time to get an electricity connection by streamlining procedures through the 1 DB18 Electricity utility instead of different agencies. It also reduced costs by eliminating the security deposit for large commercial clients. Revisions to rules governing the establishment and licensing of new electrical connections to the national power grid translate into an optimized, simplified, and streamlined connection process. Customer service is now organized as a one-stop shop for meeting requirements, making payments, receiving permits and licenses, and arranging inspections and connections. A rule requiring prior inspection and authorization of a connection application by the Ministry of Energy has been eliminated. Rwanda Protecting Rwanda strengthened minority investor protections by making it easier to sue directors, clarifying 1 DB18 Minority ownership and control structures and requiring greater corporate transparency. The new law incorporates Investors best practices for the protection of minority investors. It introduces and reinforces provisions that enhance corporate governance and transparency by clarifying shareholder rights and establishing director duties and liabilities. The law provides for disclosure of related party transactions and significant ownership stakes. It includes provisions that strengthen and protect the rights of minority shareholders. The new law has boosted investor confidence by strengthening the rights of minority shareholders, increasing their access to information, and providing for their participation in shareholder meetings. Rwanda Inspections Rwanda made trading across borders easier by removing the mandatory pre-shipment inspection for 1 imported products. Rwanda Licenses and Beginning in September 2017, Rwanda began reducing mobile termination rates (MTR)—the fees that one 1 Permits telecommunications operator charges another for terminating calls and texts on its network. As of 2019, the MTR has been cut by 90 percent to just over two-tenths of a cent per minute. The revised MTR rates allow operators to reduce consumer prices, leveling the playing field and encouraging investment by current operators in the telecommunications sector. Already one operator, TIGO, has reduced rates on mobile networks in response to the reduction. Previously, Rwandan consumers were paying higher tariffs for calls and text messages than consumers elsewhere in the region. Rwanda Starting a Rwanda made starting a business less costly by replacing electronic billing machines with free software for 1 DB19 Business value-added tax invoices. A revised ministerial order now makes clear business entities are required to use an electronic billing machine (EBM). The previous requirement that all businesses and start-ups purchase an EBM has now been limited to only VAT-registered taxpayers. This means that the majority of businesses in Rwanda which are SMEs and which fall under the Doing Business case study, are not required to comply with the EBM requirement, translating into a savings for these small firms of approximately $170. South Africa Starting a South Africa made starting a business easier by reducing the time for online business registration. The 1 DB19 Business time involved to start a business was reduced from 45 days to 40 days. The project team contributed to the reform through preparation of an updated Doing Business Reform Memo, which was submitted to InvestSA and the Office of the President. It included simulated post-reform scores on the Distance to Frontier, enabling the government to see how the reform would enhance the country’s Doing Business ranking. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 72 Annex 1 : FIAS REFORM TOTALS AND DESCRIPTIONS 1.2 Reforms and Results from FIAS-Funded Projects (continued) NUMBER OF DB COUNTRY REFORM TOPIC REFORM DESCRIPTION REFORMS VALIDATED AFRICA South Africa Getting Electricity South Africa improved the monitoring and regulation of power outages by beginning to record data 1 DB19 for the annual system average interruption duration index (SAIDI) and system average interruption frequency index (SAIFI). The effort was centered on the City of Johannesburg with the aim of improving the reliability of power supply monitoring. The city started calculating the total duration and frequency of outages per customer using the SAIDI and SAIFI methodology, making them eligible to score on the reliability of supply and transparency of tariffs index. Measuring the number and duration of power interruptions is a critical step to improving the process of getting electricity. Without such information, electricity companies cannot monitor and measure their performance. The availability of the data makes it possible to introduce necessary improvements to ensure more reliable service and access to electricity. Togo Construction Togo made dealing with construction permits safer by implementing decennial liability and insurance 1 DB19 Permits and strengthening quality control before construction. Togo also reduced the cost to obtain a building permit. EAST ASIA AND THE PACIFIC 1 Myanmar Investment Policy Cumbersome procedures for registering new investments contributed to an average of 90 days for 1 - Entry the Myanmar Investment Commission (MIC) to process an investment proposal. Where previously all foreign investment proposals had to be approved by MIC, the new Myanmar Investment Law allows investments of less than $5 million to be processed by a newly established State-Region Investment Committee which is required to issue investment endorsements within 30 days. With simplified procedures and fewer applications to process, MIC is able to handle larger investment proposals more quickly than before. EUROPE AND CENTRAL ASIA 13 Albania Enforcing Albania made enforcing contracts easier by amending the code of civil procedure to establish a 1 DB19 Contracts simplified procedure for small claims and introduce time standards for certain court events. A new law that entered into force in November 2017 amends the civil procedure code to require judges to reform and guide parties about the possibility of resolving disputes through mediation; require defendants to file a statement of defense within 30 days of the notification of a lawsuit; simplifies procedures for handling small claims; and establishes reasonable time limits for court proceedings and decisions. Azerbaijan Property Transfers Azerbaijan made registering property easier by increasing the transparency of the land administration 1 DB19 system. During the second half of 2017, the State Committee updated its website to publish statistics on the number of property transactions. The Ministry of Justice upgraded its website to include statistics on the number of land disputes in the First Instance Court. The reforms stem from a Doing Business Action Plan delivered in 2016 by the IFC project team. Azerbaijan Investor Azerbaijan strengthened minority investor protections by increasing shareholder rights and their role in 1 DB19 Protections major corporate decisions, clarifying ownership and control structures and requiring greater corporate transparency. A new law passed by the National Assembly in April 2018 addresses shareholder rights, ownership and control structures, and corporate transparency. Members of limited liability companies wishing to sell shares are required to first offer the shares to existing members of the company before transferring them to a third party. LLCs are required to pay dividends within 30 days of the declaration date. Joint-stock companies must now disclose the compensation of directors on an individual basis in their annual reports. Azerbaijan Construction Azerbaijan made dealing with construction permits easier by streamlining its construction permitting 1 DB19 Permits process. Construction permits are now issued only by the Baku City Executive Office single window. Low-risk construction sites along with their construction designs no longer need to pass a comprehensive project review; passing a project review with the Ministry of Emergency Situations is no longer required. Investors are only required to use the single window to obtain a construction permit. The number of procedures and days needed to deal with construction permits has declined from 21 procedures and 242 days to 18 procedures and 116 days. Bosnia and Investment Policy The Local Investment-Friendly Environment (LIFE) project assisted 21 local governments in 1 Herzegovina - Promotion development, programming, and implementation of a targeted investor aftercare program through multi-level government collaboration. Local governments proactively approached 103 companies—both foreign and domestic investors doing business in the country—to discuss unresolved issues and either resolve them or propose reforms where changes in the legal framework were required. The targeted aftercare program resulted in an increased percentage of investors' open issues resolved (19 percent) and number of firms investing (eight), and generated new investments of $25.4 million. These outcomes were confirmed by the project’s investor survey. Investors acknowledged the value of the services provided under the aftercare program, including fast tracking of permits and licenses, assistance in identifying investment location, connecting to infrastructure, and provision of investment incentives. Continued on next page FIAS 2018 Annual Review 73 Annex 1 : FIAS REFORM TOTALS AND DESCRIPTIONS 1.2 Reforms and Results from FIAS-Funded Projects (continued) NUMBER OF DB COUNTRY REFORM TOPIC REFORM DESCRIPTION REFORMS VALIDATED Croatia Registering Croatia made transferring property more efficient by digitizing its land registry. 1 DB19 Property Kazakhstan Enforcing Kazakhstan made enforcing contracts easier by making judgments rendered at all levels in commercial 1 DB19 Contracts cases publicly available and publishing performance measurement reports on local commercial courts. A database of judicial acts, was launched on the official website of the Supreme Court of Kazakhstan. After some initial technical difficulties, it was modernized and enhanced so that as of May 2018, judgments rendered in commercial cases in trial courts, courts of appeal, and the Supreme Court were available to the public via the website, along with statistics on the performance of courts. For example, data was provided for the Almaty Inter-District Commercial Court on the time required to resolve cases, the number of received cases during a specific reporting period, and the cases and applications under consideration at the beginning of a reporting period Kazakhstan Starting a Kazakhstan made starting a business easier by reducing the time required for value-added tax 1 DB19 Business registration. Kosovo Construction Kosovo made dealing with construction permits easier by streamlining the inspection system using 1 DB19 Permits an in-house engineer. The Pristina Municipality in Kosovo eliminated the practice of conducting inspections during construction. A location inspection and final inspection are conducted by the municipality; for inspections during constructions, the owner must use an in-house qualified engineering professional. The number of procedures for dealing with construction permits has been reduced from 15 to 12. Kyrgyz Enforcing The Kyrgyz Republic made enforcing contracts easier by introducing a pre-trial conference as part of the 1 DB19 Republic Contracts case management techniques in court and adopting a consolidated law on voluntary mediation. Among other innovations, the new law introduced a pre-trial conference as part of the case management techniques used in court. Pre-trial conferences are now conducted in practice in all courts, including the Bishkek Inter-District Court. Another new law that also took effect in July 2017 introduced a consolidated set of rules regulating voluntary of virtually all aspects of mediation, including the enforceability of mediated settlement agreements. Kyrgyz Investor The Kyrgyz Republic strengthened minority investor protections by increasing shareholders’ rights 1 DB19 Republic Protections and role in major corporate decisions, strengthening the independence of boards of directors and barring subsidiaries from acquiring shares issued by their parent companies. Amendments to the law on joint stock companies entered into force in August 2017 with new provisions on shareholder rights and ownership and control structures of listed companies. The amendments require that no less than 30 percent of the board of directors be independent, meaning they are unaffiliated with the company, unrelated to anyone in the company, not government officials, and not auditors or shareholder representatives of the company. The new provisions allow shareholders representing 10 percent of share capital to call extraordinary meetings of shareholders and prohibit a subsidiary from acquiring shares issued by the parent company. Uzbekistan Trade Facilitation Uzbekistan made trading across borders faster by introducing an electronic application and payment 1 DB19 system for several export certificates, reducing the time for export documentary compliance. A new version of Uzbekistan’s single-window website introduced in July 2017 allowed for electronic requests and payment of various certificates required for export, such as certificates of origin and phytosanitary certificates. With the implementation of these new features, the overall time of documentary compliance for export has decreased from more than seven days to four days. Uzbekistan Investor Uzbekistan strengthened minority investor protections by clarifying the ownership and control 1 DB19 Protections structures of listed companies. In December 2017, Uzbekistan amended the law on joint stock companies and protection of shareholder rights. Specifically, the amendments prohibit subsidiary companies from owning voting shares of their parent company. Companies that acquired voting shares of their main or parent companies before the entry into force of the prohibition are not entitled to vote at the general meeting of shareholders of the respective company. Continued on next page FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 74 Annex 1 : FIAS REFORM TOTALS AND DESCRIPTIONS 1.2 Reforms and Results from FIAS-Funded Projects (continued) NUMBER OF DB COUNTRY REFORM TOPIC REFORM DESCRIPTION REFORMS VALIDATED LATIN AMERICA AND CARIBBEAN 2 Central Agribusiness The six countries of the Council of Ministers of Economic Integration of Central America (Costa Rica, El 1 America Salvador, Guatemala, Honduras, Nicaragua, and Panama) streamlined trade procedures for processed Region food and beverages in the region. Prior to this project, companies needed to go to each country to request a certificate of free sale of each product that they wanted to trade, a timely and costly process. The reform streamlined, harmonized, and automated procedures for sanitary registration for processed food beverages with the ultimate aim of boosting entrepreneurship and productivity, creating jobs, enlarging the regional market, and making the region a more attractive investment destination. The reform, which took effect in July 2017, reduced the number of documents required to recognize registries from four to two. Colombia Investment Policy Colombia established an effective investor grievance mechanism (IGM) to enable governments to 1 - Protection and effectively address political risk grievances. IGM includes a monitoring and tracking system providing Retention information on the number of investor grievances and the associated investment at risk. MIDDLE EAST AND NORTH AMERICA 2 Jordan Investment Policy Jordan improved its investment incentives regime through the launch of an online database providing 1 - Incentives investors and stakeholders with comprehensive and up-to-date information about all types of incentives available to investors. The reform increased transparency of the incentives regime, enabling investors to make better informed decisions. By making the parameters for providing incentives publicly available, the reform reduced possibility for discretionary decisions by government agencies. It gave government, through the Jordan Investment Commission (JIC), an instrument for investment promotion and subsequent cost-benefit analysis of all incentives, and a better way to ensure that the investment incentives aligned with national priorities for investment. Jordan Investment Policy IFC helped Jordan develop the capacity of the new Jordan Investment Commission (JIC) as a lead 1 - Promotion investment promotion agency and equipped it with the tools and resources to attract, retain and support investors. Investment promotion reform in Jordan was a core pillar in the World Bank lending program, “Economic Opportunities for Jordanians and Syrian Refugees, Program for Results,” for which the technical advisory was delivered through this project. IFC helped develop the Investment Promotion Directorate (IPD) structure, its operation manuals and instructions, and staff jobs description. Numerous trainings and capacity building events were conducted, and the IPD staff were specifically trained on the investment promotion technique, including lead generation. Prior to the reform, JIC had struggled with a lack of knowledge and experience of working with investors, high turnover and low training levels of staff, and poor coordination internally and with other government agencies. SOUTH ASIA 10 Afghanistan Resolving Afghanistan made resolving insolvency easier by improving the continuation of a debtor’s business 1 DB19 Insolvency during insolvency proceedings, introducing the reorganization procedure, and granting creditors greater participation in the proceedings. The revised Insolvency Law clearly defines procedures for solving private sector problems in cases of insolvency. Enactment of the law provides clarifies issues for the private sector relating to resolving insolvency, eligibility of debtors, appointment, qualification, and remuneration of the receiver, auditors, and other stakeholders. Afghanistan Getting Credit Afghanistan strengthened access to credit by enacting a new insolvency law. Secured creditors are now 1 DB19 given absolute priority over other claims within insolvency proceedings. The project supported the Afghan Presidential Office, Senior Economic Advisory Unit, providing feedback on drafts and the final version which clearly defines procedures for solving private sector problems in case of insolvency and gives an absolute priority to secured creditors within insolvency proceedings. Afghanistan Tax Simplification Afghanistan made paying taxes easier by adopting a new tax administration and law manual with clear 1 DB19 and Compliance rules and guidelines on tax audit, and by automating the submission of tax returns. The project provided Management recommendations on paying taxes in Afghanistan to government counterparts. Discussions with the private sector led to recommendations which included e-filing and risk management techniques. Based on recommendations, the government adopted a new tax administration and law manual with clear rules and guidelines on tax audit and automated the submission of tax returns resulting in streamlined processes for paying taxes. FIAS 2018 Annual Review 75 Annex 1 : FIAS REFORM TOTALS AND DESCRIPTIONS 1.2 Reforms and Results from FIAS-Funded Projects (continued) NUMBER OF DB COUNTRY REFORM TOPIC REFORM DESCRIPTION REFORMS VALIDATED SOUTH ASIA LATIN AMERICA AND CARIBBEAN 2 Afghanistan Protecting Afghanistan strengthened minority investor protections by requiring greater disclosure of transactions 1 DB19 Minority Investors with interested parties, easing shareholder suits by extending access to documents and evidence during trial, increasing shareholders’ rights and role in major corporate decisions, clarifying ownership and control structures, and requiring greater corporate transparency. The Presidential Office, Senior Economic Advisory Unit, led in the drafting of a limited liability companies law that incorporated inputs from the project team. The law requires greater disclosure of transactions with interested parties, streamlines shareholder suits by extending access to documents and evidence during trial, increases shareholders’ rights and role in major corporate decisions, clarifies ownership and control structures, and requires greater corporate transparency. Afghanistan Starting a Afghanistan made starting a business less costly by reducing the fees for business incorporation. The 1 DB19 Business project entailed extensive discussions with various actors on the lowering of the fees and engagement with the Ministry of Industry and Commerce with the aim of simplifying and streamlining procedures, reducing the cost of incorporation, updating the Ministry’s operational manual, and reducing the cost of publishing company information in official gazette. The cost of new company license was reduced from the equivalent of about $400 to under $1.50, and of a new individual license from about $240 to under $1.50. India Tax Simplification India made paying taxes easier by replacing many indirect taxes with a single indirect tax, the Goods 1 DB19 and Compliance and Services Tax (GST), for the entire country. India also made paying taxes less costly by reducing the Management corporate income tax rate and the employees’ provident funds scheme rate paid by the employer. This reform applies to both Delhi and Mumbai. The GST, which went into effect in mid-2017, applies to all goods other than five petroleum products and alcoholic beverages. Under the new law, the previous sales taxes, including the central sales tax, state value-added tax, and the service tax have been merged into the GST. The Finance Act, which went into effect in Spring 2017, reduced the corporate income tax rate from 30 percent to 25 percent and the annual depreciation rates for office equipment from 60 percent to 40 percent. India Trade Logistics India reduced the time and cost to export and import through various initiatives, including the 1 DB19 implementation of electronic sealing of containers, the upgrading of port infrastructure, and allowing the electronic submission of supporting documents with digital signatures. This reform applies to both Delhi and Mumbai. India also changed regulations pertaining to weekly holiday work, overtime hours, and paid annual leave. These reforms were part of a broad effort by India to make trade processes more efficient as part of the National Trade Facilitation Plan 2017-2020. For Mumbai exports, border compliance time and cost decreased from 85 hours and $348 to 54 hours and $250, while documentary compliance time and cost decreased from 58 hours and $94 to 24 hours and $80. For Mumbai imports, border compliance time and cost decreased from 267 hours and $536 to 102 hours and $340, while documentary compliance time and cost decreased from 65 hours and $129 to 35 hours and $100. For Delhi exports, border compliance time and cost decreased from 125 hours and $413 to 77 hours and $253, while documentary compliance time and cost decreased from 21 hours and $90 to 6 hours and $80. For Delhi imports, border compliance time and cost decreased from 262 hours and $550 to 92 hours and $323, while documentary compliance time and cost decreased from 58 hours and $140 to 25 hours and $100. India Getting Credit India strengthened access to credit by amending its insolvency law. Secured creditors are now given 1 DB19 absolute priority over other claims within insolvency proceedings. This reform applies to both Delhi and Mumbai. Under the new law, which took effect in November 2017, secured creditors are repaid first during business liquidation, and hence have priority over other claims such as labor and tax. The work of the FIAS-supported team included technical assistance through the design of the Doing Business Reform Memo, preparation of Reform Action Plans, completion of feedback surveys and periodic diagnostics, and dialogue with users and implementers. FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 76 Annex 1 : FIAS REFORM TOTALS AND DESCRIPTIONS 1.2 Reforms and Results from FIAS-Funded Projects (continued) NUMBER OF DB COUNTRY REFORM TOPIC REFORM DESCRIPTION REFORMS VALIDATED SOUTH LATIN ASIA AMERICA AND CARIBBEAN 2 India Starting a India made starting a business easier by fully integrating multiple application forms into a general 1 DB19 Business incorporation form. Replacement of the value-added tax with the Goods and Services Tax (GST) streamlined the registration process. These reforms apply to both Delhi and Mumbai. At the same time, Mumbai abolished the practice of site inspections for registering companies under the Shops and Establishments Act. Under the revised Companies Rules which took effect in January 2018, companies no longer submit separate forms for registering a Permanent Account Number and Tax Deduction and Collection Account Number (PAN and TAN). Under a new registration procedure in Mumbai, a site visit is no longer required for registering a new company. The number of procedures to start a business in Delhi and Mumbai has been reduced from 11 and 12 respectively to 10 in both cities. The time has decreased from 30 days in Delhi and 29.6 days in Mumbai to 16 and 17 days respectively. India Construction India streamlined the process of obtaining a building permit and made it faster and less expensive to 1 DB19 Permits obtain a construction permit. It also improved building quality control by introducing decennial liability and insurance. This reform applies to both Delhi and Mumbai. The reform, implemented in the second half of 2017, put in place a new Single Window Clearance System in Delhi, and an Online Building Permit Approval System in Mumbai. Implementation of these online platforms centralized approvals from various agencies. The reform also amended regulations on water and sewer connections, reducing the cost to obtain water connections in both cities. In Delhi, the number of procedures was reduced from 24 to 16; the time involved reduced from 157.5 days to 91 days; and the cost reduced from 23.9 percent to 4.2 percent. In Mumbai, the number of procedures was reduced from 37 to 20; the time decreased from 128.5 days to 99 days; and the cost declined from 22.5 percent to 6.6 percent. Both cities also amended their liability and insurance regimes for all categories of buildings over 750 square meters, making architects, structural engineers, site supervisors and engineers, and construction companies liable for structural flaws and defects. Grand Total 40 FIAS 2018 Annual Review 77 Annex 2 : PORTFOLIO OF FIAS-FUNDED PROJECTS IN FY18 2.1 FIAS-Funded Client-Facing Projects* TOTAL TOTAL FYTD FIAS PROJECT REGION CODE COUNTRY PROJECT NAME FUNDING EXPENDITURES EXPENDITURES STATUS EAST ASIA AND THE PACIFIC EAP China China Green Inds $1,700,000 $169,213 $169,212 TERMINATED EAP Indonesia Indo ICCC MCICP $3,740,000 $102,635 $102,708 ACTIVE EAP Lao PDR LS-INVT Climate $1,584,918 $185,418 $79,029 ACTIVE EAP Mongolia IPAIP $2,050,467 $325,889 $82,109 ACTIVE EAP Myanmar Invest. Policy $2,265,115 $404,336 $34,656 ACTIVE EAP Timor-Leste Timor-Leste IPP $1,174,099 $86,522 $17,243 ACTIVE EAP Vietnam VN PSC $4,638,082 $604,608 $616,599 ACTIVE EUROPE AND CENTRAL ASIA ECA Albania Albania IC Comp $2,185,641 $371,604 $342,805 ACTIVE ECA Albania W. Balkans IPP $2,766,000 $440,161 $440,161 ACTIVE ECA Armenia Armenia Gender $564,013 $79,412 $22,190 ACTIVE ECA Armenia Armenia IPP/Agri $1,350,000 $148,214 $148,580 ACTIVE ECA Azerbaijan Az IC Agri Comp $3,154,410 $200,636 $200,636 ACTIVE ECA Belarus Belarus NQI&BR $3,381,041 $372,564 $342,202 ACTIVE ECA Europe IBRA in ECA $1,464,523 $155,514 $146,695 ACTIVE ECA Georgia Geo tr/inv/agr. $1,850,000 $326,443 $319,347 ACTIVE ECA Kosovo Kosovo IC II $2,564,045 $204,527 $188,695 ACTIVE ECA Kyrgyz Republic Kyrgyz IC $2,928,374 $250,959 $13,336 ACTIVE ECA Macedonia, FYR BR4C $1,850,000 $16,156 $16,156 ACTIVE ECA Ukraine ECA Agri-Finance $5,720,000 $1,571,867 $49,525 ACTIVE LATIN AMERICA AND THE CARIBBEAN LAC Colombia IPP Colombia $195,123 $20,787 $10,787 ACTIVE LAC Colombia Prod&Job Colombia $2,700,000 $165,854 $165,856 ACTIVE LAC Latin America CA Regional Trade $3,558,954 $682,256 $537,680 ACTIVE LAC Latin America LAC IBRA $3,215,037 $616,757 $106,558 ACTIVE LAC Latin America LAC Competition $335,000 $84,302 $84,302 TERMINATED LAC Latin America Investment in PA $182,872 $98,538 $98,541 ACTIVE LAC Latin America Services in PA $132,176 $75,049 $75,049 ACTIVE LAC Peru Peru OECD $623,443 $105,715 $36,266 ACTIVE MIDDLE EAST AND NORTH AFRICA MENA Afghanistan AF- Bus Lic II $2,749,288 $1,299,978 $1,299,978 ACTIVE MENA Afghanistan AF- Inv. Climate $1,331,650 $1,029,278 $1,029,278 ACTIVE MENA Egypt, Arab Rep. E4E - ICT EG $1,436,304 $296,990 $87,629 ACTIVE MENA Egypt, Arab Rep. ECProgram $1,325,189 $460,049 $460,049 ACTIVE MENA Jordan JOR Insp Ref II $4,867,001 $753,818 $24,736 ACTIVE MENA Jordan Jordan IPP $732,094 $77,183 $77,183 ACTIVE MENA Jordan Jordan NQI $1,100,000 $76,923 $76,922 ACTIVE MENA Lebanon TSEZ Regulatory $1,156,985 $155,777 $94,220 ACTIVE MENA Middle East and IBRA in MENA $1,434,205 $103,547 $103,547 ACTIVE North Africa MENA Tunisia Tunisia IC RP $3,555,862 $516,405 $74,476 ACTIVE MENA Tunisia ICT E4E Tunisia $1,139,502 $176,195 $71,948 ACTIVE MENA Tunisia VCforGrowth&Jobs $2,125,003 $73,107 $73,108 ACTIVE SOUTH ASIA SA Afghanistan AF Bus Enabling $2,616,672 $51,743 $38,235 ACTIVE SA Bhutan FI Bhutan $1,602,737 $411,060 $43,363 ACTIVE SA India Buddhist Circuit $2,377,748 $158,726 $64,622 ACTIVE (continued) FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 78 Annex 2 : PORTFOLIO OF FIAS-SUPPORTED PROJECTS IN FY18 2.1 FIAS-Funded Client-Facing Projects (continued) TOTAL TOTAL FYTD FIAS PROJECT REGION CODE COUNTRY PROJECT NAME FUNDING EXPENDITURES EXPENDITURES STATUS SOUTH ASIA SA India IEODB $2,574,163 $854,837 $59,857 ACTIVE SA South Asia SARTI IP $3,545,964 $489,492 $116,400 ACTIVE SUB-SAHARAN AFRICA SSA Africa ICRR III $2,628,598 $12,785 $12,786 CLOSED SSA Africa AFR Competition $1,309,252 $107,584 $97,573 ACTIVE SSA Africa SSA IBRA 3 $1,833,172 $176,845 $164,251 ACTIVE SSA Angola Angola IC $650,000 $35,783 $35,783 TERMINATED SSA Benin Invest Benin $500,000 $76,949 $76,948 ACTIVE SSA Cameroon CMR CRP $320,000 $26,970 $26,970 ACTIVE SSA Central African Rep. CEMAC IC $568,550 $171,648 $165,981 ACTIVE SSA Congo, Dem. Rep. DRC Inv Climate $1,497,254 $138,922 $27,921 ACTIVE SSA Eswatini Swaziland TC $967,852 $213,569 $38,192 ACTIVE SSA Ethiopia Ethiopia Lv Stock $2,100,000 $501,906 $501,905 ACTIVE SSA Ethiopia East Africa SIRM $1,710,000 $90,769 $90,769 ACTIVE SSA Ghana Ghana ICP $4,073,048 $453,839 $453,839 ACTIVE SSA Ghana Invest Ghana $1,500,000 $104,139 $104,138 ACTIVE SSA Guinea Guinea IC Mining $2,167,140 $648,913 $107,040 ACTIVE SSA Liberia Liberia SL TFA $1,010,000 $49,682 $11,081 ACTIVE SSA Madagascar Madagascar ICRP $2,649,373 $521,364 $30,165 ACTIVE SSA Mali Mali IC3 - E W $2,187,590 $579,913 $551,245 ACTIVE SSA Mozambique Moz IC Program 2 $4,173,458 $87,184 $87,184 ACTIVE SSA Mozambique Moz IC Project 2 $2,400,000 $48,943 $44,806 ACTIVE SSA Nigeria Nigeria LV Stock $2,042,352 $320,454 $320,455 ACTIVE SSA Rwanda Rwanda SIRM $534,710 $28,390 $28,390 ACTIVE SSA Senegal Senegal WHR $1,379,925 $172,383 $21,760 ACTIVE SSA Senegal Invest Senegal $1,750,000 $376,715 $381,316 ACTIVE SSA Somalia Somalia ICRP $4,172,013 $1,743,887 $73,882 ACTIVE SSA South Africa South Africa T&C $7,007,300 $258,980 $190,614 ACTIVE SSA South Africa SA PSCP $3,000,001 $270,778 $219,133 ACTIVE SSA Tanzania Tanzania Lv Stock $2,100,000 $621,621 $621,621 ACTIVE SSA Tanzania EAC Phase III $4,635,000 $156,560 $45,947 ACTIVE SSA Togo Togo ICTA $500,000 $187,573 $187,573 ACTIVE SSA Western Africa OHADA UA 2 $5,268,269 $458,236 $458,236 ACTIVE SSA Western Africa West Africa IPIC $10,342,972 $1,650,881 $1,634,141 ACTIVE SSA Western Africa Invest W Africa $3,026,477 $935,375 $827,127 ACTIVE SSA Western Africa Invest W Africa Tourism $1,900,000 $38,556 $38,556 ACTIVE SSA Zambia Zambia IC III $3,275,845 $696,544 $31,439 ACTIVE WORLD WLD World GRP Joint Pilots $2,476,779 $537,374 $528,169 ACTIVE *Projects with less than $10,000 FIAS spend have been removed from the list. FIAS 2018 Annual Review 79 Annex 2 : PORTFOLIO OF FIAS-SUPPORTED PROJECTS IN FY18 2.2 FIAS-Funded Knowledge Management and Product Development Projects TOTAL FYTD FIAS REGION PROJECT NAME TOTAL FUNDING EXPENDITURES EXPENDITURE PROJECT STAGE World Manufg Prod Devt $393,587 $44,219 $44,219 ACTIVE World GRP - GGP $535,000 $33,033 $33,033 ACTIVE World GRP T&C $814,431 $200,303 $201,810 ACTIVE World IC App. Research $2,266,250 $786,715 $271,379 ACTIVE World T&C S4C PDP $889,856 $257,294 $318,585 ACTIVE World QI PDP $721,862 $318,179 $218,521 ACTIVE World High-Growth firm $461,717 $147,471 $126,924 ACTIVE World PDP Creative Ind $294,711 $79,991 $79,991 ACTIVE World MNE Linkages $575,060 $168,337 $168,337 ACTIVE World IPP PDP $1,265,919 $645,743 $528,055 ACTIVE World COMPEL 1 $1,786,263 $619,892 $619,892 ACTIVE World CCI 2 $483,072 $138,083 $74,254 ACTIVE World Agribusiness PDP $2,997,038 $760,840 $752,341 ACTIVE World IC IBR $749,184 $293,211 $237,262 ACTIVE World Biz Env 3 $1,162,322 $520,795 $346,492 ACTIVE World Global CP PDP II $751,551 $262,489 $262,489 ACTIVE World Gender T&C $1,119,677 $335,968 $335,969 ACTIVE World Spatial Solution $435,222 $95,266 $95,266 ACTIVE World Tourism PDP $734,608 $262,108 $262,108 ACTIVE FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 80 Annex 3 : KEY FY18 PUBLICATIONS, EVENTS 3.1 Publication Highlights During FY18, FIAS-supported teams produced and bring frontier thinking on the measurement and disseminated knowledge on a wide range of topics determinants of productivity to global policy makers. related to the business environment, markets, and This report brings new data sources to explore the competitiveness. Highlights include: innovation “paradox”: despite the potential for very high returns, developing countries invest far less in Flagship Publications, Toolkits, and Guidance adopting and inventing new processes and products than advanced countries. (October 2017) Internet of Things: The New Government-to- Business Platform, explores the IoT phenomenon, Trouble in the Making? The Future of examines evidence to see how the theoretical Manufacturing-Led Development highlights the potential of IoT implementation matches up with ways technology and globalization are changing the reality on the ground, and offers lessons how goods will be manufactured in the future and from government agencies at the forefront of IoT what developing countries can do to ensure they implementation. (November 2017) remain competitive. The report looks at advances in technology – automation, advanced robotics, artificial Dialogue for Climate Action: Designing Dialogue intelligence, 3-D printing – to determine how they will for Climate Change, developed by a group of public impact jobs in developed and developing countries. and private sector partners, provides guidance for (September 2017) countries as they implement the Paris Agreement. The paper proposes six fundamental principles to support Coding Bootcamps: Building Future-Proof Skills the establishment and enhancement of dialogue at through Rapid Skills Training examines a new kind the global, regional, national, and local levels. These of rapid skills training program for the digital age principles are focused on bringing the public and that aims at low entry-level tech employability (for private sectors together as a single, well-structured example, junior developer), providing a tool for entry platform from which challenges can be identified and into the new world of digital jobs. This report studies solutions implemented. (November 2017) the characteristics, methodologies, business models, and impact of five coding bootcamps operating The Global Investment Competitiveness Report directly or through partners in developing countries. 2017/2018: Foreign Investor Perspectives and (August 2017) Policy Implications presents novel analytical insights and empirical evidence on foreign direct investment’s A Step Ahead: Competition Policy for Shared drivers and contributions to economic transformation. Prosperity and Inclusive Growth, published in The report provides insights from a variety of partnership with OECD, puts forward a research sources, including a new survey of 750 executives agenda that advocates the importance of market of multinational corporations investing in developing competition, effective market regulation, and countries, extensive analysis of available data and competition policies for achieving inclusive growth evidence, and a thorough review of international and shared prosperity in emerging and developing best practices in investment policy design and economies. (June 2017) implementation. (October 2017) Women and Tourism: Designing for Inclusion Research Studies (published as World Bank Policy explains the rationale for integrating a gender lens into Research Working Papers) tourism development projects, and it includes a set of What Investors Want: Perceptions and Experiences resources designed to help development professionals of Multinational Corporations in Developing and project managers get started and find necessary Countries discusses the results of a survey of data. This publication paves the way for more in-depth multinational corporations with affiliates in developing operational research and data collection on what countries. The paper explores corporate perspectives works for empowering women in the tourism sector. and decision making across the stages of the (October 2017) investment cycle: attraction, entry and establishment, The Innovation Paradox: Developing-Country operations and expansion, linkages with the local Capabilities and the Unrealized Promise of economy, and, in some cases, divestment and exit. Technological Catch-Up, the first volume of (March 2018) the World Bank Productivity Project, seeks to FIAS 2018 Annual Review 81 Annex 3 : KEY FY18 PUBLICATIONS, EVENTS Giving Sisyphus a Helping Hand: Pathways for Sustainable RIA Systems in Developing Countries contributes to the debate on regulatory impact assessment in developing countries by addressing the lack of a systematic account of reforms, and the lack of a comprehensive explanatory account of reform outcomes. (March 2018) Labor Adjustment Costs across Sectors and Regions estimates the mobility costs of workers across sectors and regions in a large sample of developing countries. (November 2017) A BIT Far? Geography, International Economic Agreements, and Foreign Direct Investment: Evidence from Emerging Markets studies the ways in which bilateral investment treaties and preferential trade agreements interact with geographic and cultural distance to influence firms' investment patterns. (September 2017) The Heterogeneous Growth Effects of the Business Environment: Firm-Level Evidence for a Global Sample of Cities uses firm-level data covering 709 cities in 128 countries to examine the role of a comprehensive list of business environment variables at the subnational level in explaining firm employment and productivity growth. (June 2017) Country-Specific Reports and Case Studies Strengthening Argentina's Integration into the Global Economy: Policy Proposals for Trade, Investment, and Competition presents a set of robust empirical analyses, drawing from both general and partial equilibrium exercises, to assess the potential impacts from trade, competition, and investment policy reforms. It offers a new comparative review of international experience with structural microeconomic reform programs to bring insights for Argentina’s design and sequencing of such reforms. (April 2018) Tajikistan: Improving the Inspections Regime by Addressing Regulatory Implementation Gaps details the process of identifying and addressing gaps in the implementation of inspection regulations. It describes the tools used to assess implementation gaps, how those assessments helped narrow the implementation gap of the Law on Inspections, and lessons learned. (December 2017) A Burmese woman carrying brick at construction site in Mandalay Myanmar. Photo: Bigstock continued on next page FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 82 Annex 3 : KEY FY18 PUBLICATIONS, EVENTS 3.1 Publication Highlights (continued) Looking Beyond the Horizon: A Case Study of PVH’s Commitment to Ethiopia's Hawassa Implementing a Business-to-Government Industrial Park discusses the decision of the world’s Feedback Mechanism in the Kyrgyz Republic to second largest apparel company to move production Improve Public-Private Dialogue and Regulatory to Africa, with Ethiopia as the base for its new Service Delivery, a case study, discusses business model. This case study also highlights the key approaches and lessons learned during Ethiopian government’s strategy to attract and expand implementation of the online mechanism, which export-oriented investments, including efforts to included public sector involvement in the design and bolster the country’s competitiveness. (June 2017) implementation and capacity building of personnel. (December 2017) Brief Notes Assessment of Firm-level Skills Demand and Leveraging Technology to Support Construction Engagement in Skills Development: Creating a Regulation and Permitting Reform: Insights from Demand-led Skills Ecosystem in Moldova analyzes Recent Country Experience examines findings the current skills ecosystem across six sectors. Based from a recent Bank Group survey of 27 national and on interviews with private sector and government local authorities that have deployed ICT solutions to representatives and training providers, as well as support more effective building control. desk research, the report highlights skills demand and mismatches, the current practices for human resource development within firms, and engagement with training providers and education institutions. The 3.2 FY18 Event Highlights report is intended to provide ideas for demand-led and demand-responsive skills development initiatives. EFI teams organized or were involved in numerous (November 2017) conferences, seminars, and knowledge-sharing events held in FY18. Many of these events focused Promoting Investment Policy Reforms Amid on topics related to the FIAS strategic pillars— Political Turbulence and Transition: The Case improving the business environment, expanding of Tunisia and the Arab Spring shows that, even market opportunities, and strengthening firm during long transitions marked by political and social competitiveness. Highlights include: tensions, investment policy reforms can be achieved. This brief note documents Tunisia’s investment policy Good regulatory practices reform approach and its significant parallels with Four deep-dive sessions, organized as part of the seven guiding principles considered good practice event, “Good Regulatory Practices for Transparency, for countries undertaking investment policy reforms. Predictability, and Efficiency: Results and Lessons (October 2017) Learned from New Knowledge Products and Pilots Investment Climate Assessment of Bhutan: under the Good Regulatory Practice Program” Removing Constraints to Private Sector (May 3–4), delved into regulatory reforms in Development to Enable the Creation of More and several countries and featured tools developed and Better Jobs provides a detailed assessment of firm supported by the program. Tools included online performance and constraints as firms enter, operate, public consultation (Notice & Comment) in Malaysia, and exit domestic and international markets. It offers evidence-based rulemaking (Regulatory Impact policy recommendations that will support Bhutan in Assessment) in Armenia, comprehensive regulatory achieving an investment climate conducive to private governance diagnostics (Regulatory Policy and sector growth and the creation of productive and Delivery Review) in Ethiopia, and leveraging data gainful employment. (September 2017) to address implementation gaps in Belarus, Brazil, and India. Participants included clients, donors, Ukraine National Quality Infrastructure Gap technical specialists, and Bank Group staff, with Assessment evaluates market gaps between supply senior government officials from the project countries of and demand for quality assurance services. It sharing their insights and experiences. includes analyses of the status and capabilities of facilities providing quality assurance services in Competition advocacy Ukraine and of producers’ demand for these services, At the International Competition Network (ICN) particularly related to European Union market access. Annual Conference in New Delhi, India (March (August 2017) 21–23), representatives from competition authorities FIAS 2018 Annual Review 83 Annex 3 : KEY FY18 PUBLICATIONS, EVENTS chosen as winners and honorable mentions in the 5th Agribusiness in Africa Competition Advocacy Contest discussed lessons At the knowledge-sharing session, “Do Geographical learned as part of the awards presentation and panel Indications Have a Role in Creating Markets for discussion. The contest, sponsored by ICN and the Sustainable Agricultural Development in Sub- Bank Group, showcases successful competition Saharan Africa?” (November 8), a panel discussed advocacy strategies across countries and sectors. considerations in using geographical indications (as exemplified in products such as Kobe beef, Darjeeling Anti-cartel enforcement tea, and Parmesan cheese) as a development tool. At the workshop, “Promoting Effectiveness in Anti-Cartel Enforcement: Investigative Methods, Special economic zones Interrogation Techniques, and Dawn Raids” in Kuwait At the eighth seminar in the Investment Climate (March), officials of the country’s Competition Applied Research series (October 31), researchers Protection Agency learned how to gather direct presented findings from an International Growth evidence of antitrust violations through both Centre paper analyzing the impact of the Kigali, theoretical and practical sessions. Rwanda special economic zone on firm outcomes. The analysis revealed that for firms, moving into the Competition principles in government zone was not only associated with greater increases The workshop, “Competition and Public in sales, value added, and permanent employment Procurement,” held in Manila, the Philippines numbers, but also direct benefits over other Kigali (January 30, 2018), focused on how to embed locations, as well as indirect benefits from lower competition principles in public procurement policies import costs. Event participants discussed types and and how to identify bid rigging cartels through uses of zones, the importance of creating linkages market screens and other analytical tools. The and facilitating skills transfer, and the role of zones as audience included representatives from key Philippine vehicles for dialogue with policymakers. procurement bodies and the Philippine Competition Commission. At a peer-to-peer learning event focused Investment competitiveness on merger analysis, also in Manila (January 28, At the three-day, inaugural Investment 2018), representatives from Canada and Spain shared Competitiveness Forum, in Vienna, Austria (October practical aspects of merger policy—and how to adapt 24–27, 2017), senior policy makers, executives of them to the Philippine context— with enforcement multinational corporations, donor partners, academia, officials of the Philippine Competition Commission in and World Bank Group staff experts delved into charge of merger control. The workshop included case the fundamentals of foreign direct investment: simulations to hone participants’ knowledge and skills. What drives FDI, and how does it contribute to development? What can governments do to Additive manufacturing maximize FDI’s benefits in developing countries? “Additive Manufacturing: How 3D Printing Can The Bank Group launched the flagship Investment Change Trade and Disrupt Industrial Models for Competitiveness Report and the Investment Emerging and Developing Countries” (November 16, Reformers Network. The agenda also included a 2017), a seminar organized by EFI and the IFC Global development partner round table; bilateral meetings MAS-Manufacturing Sector, brought together industry with delegations from 15 countries to assess progress players, civil society actors, and Bank Group experts in their investment policy reform agendas and discuss to consider additive manufacturing’s potential and its next steps; and the first working meeting of the U.K. impact on trade flows and industrial development in Prosperity Fund-financed Program on Improving developing countries. Business Environment for Prosperity. Manufacturing in Africa Inclusion strategies At the seminar, “Can Africa Be a Manufacturing The 2017 World Bank Annual Meetings event, Destination?” (November 16), Bank Group staff and “Achieving Inclusive Economic Development,” co- experts from the Center for Global Development hosted by the World Economic Forum (WEF) and the discussed findings of a study of labor costs in a Bank Group (October 13, 2017), focused on policies range of low and middle-income countries in Africa and tools that further long-term competitiveness while and elsewhere, identifying a few African countries advancing broad-based progress in living standards. ( Ethiopia, in particular) that, on a labor cost basis, The session explored the nexus of growth–inclusion– may be potential candidates for manufacturing. technology as a new compass for defining better continued on next page FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 84 Annex 3 : KEY FY18 PUBLICATIONS, EVENTS 3.2 FY18 Event Highlights (continued) economic policies for development. A panel of experts and developing economies. The symposium was drawn from WEF, global think tanks and institutes, organized by the Bank Group in collaboration with and including H.E. Dr. Sahar Nasr, Egypt’s Minister of The Growth Dialogue, George Washington University, International Cooperation and Investment, discussed the development partners of Austria, Norway, economic development strategies for the future and Switzerland, and the European Union, the Center concrete examples of implemented strategies that can on Global Economic Governance, and Columbia inspire others. University. Female employment Trends in manufacturing A seminar, “Do Multinationals Transfer Culture? An event showcasing the Bank Group flagship Evidence on Female Employment in China” (October publication, Trouble in the Making? The Future of 4, 2017), highlighted results of a study that used Manufacturing-Led Development (September 21, data on Chinese manufacturing firms to examine 2017), featured a panel discussion about changes gender norms and the global diffusion of culture. in the global manufacturing landscape and new Findings indicate that foreign affiliates from countries opportunities for less industrialized countries. with a more gender-equal culture tend to employ proportionally more women and appoint female Subnational business reforms in India managers. They also generate cultural spillovers, A one-day, peer-to-peer conference, “Business increasing domestic firms’ female labor shares in the Reforms in States and Union Territories: Sharing same industry or city. Global and Local Best Practices,” brought together Indian state-level officials in New Delhi (July 29, Disruptive technologies for development 2017). The agenda featured a panel discussion on The Symposium on New Technologies, Jobs, the importance of regulatory reforms for India’s Growth, and Development (September 22, 2017) growth aspirations and presentations by nine Indian brought together a distinguished group of thought states on their reform achievements in areas such leaders and nearly 200 participants (including as construction permitting, labor regulations, single 82 online) to explore the disruptive technologies window systems, and environmental regulations. phenomenon, its implications, and how policy can The conference was organized by the Bank Group in react to it. The agenda focused on how to use the collaboration with India’s Department of Industrial experiences of more advanced economies to help Policy and Promotion. shape better policies affecting emerging market FIAS 2018 Annual Review 85 Annex 4 : ABBREVIATIONS AfDB African Development Bank API Mali Agence pour la Promotion des Investissements au Mali (Mali Investment Promotion) AS advisory services BERF Business Environment Reform Facility (DFID) CCS compliance cost savings COMESA Common Market for Eastern and Southern Africa ComPEL Competitiveness Policy Evaluation Lab CPF country partnership framework CPSD Country Private Sector Diagnostics CWA Compact with Africa DB Doing Business, World Bank Group DFID Department for International Development (United Kingdom) DLI disbursement-linked indicator EAC East African Community ECA Europe and Central Asia Region, World Bank Group ECCB Eastern Caribbean Central Bank EEC Eurasian Economic Commission EFI Equitable Growth, Finance and Institutions Vice Presidency, World Bank Group EIP eco-industrial park FCI Finance, Competitiveness and Innovation Global Practice, World Bank Group FCS states in fragile and conflict-affected situations FDI foreign direct investment FIAS Facility for Investment Climate Advisory Services FIG Financial Institutions Group (IFC) FMTAAS Funding Mechanism for Technical Assistance and Advisory Services, IFC FY fiscal year G20 Group of 20 leading economies GDP gross domestic product GIZ Gesellschaft für Internationale Zusammenarbeit (German Development Corporation) GVC global value chain GWFP Global Warehouse Finance Program (IFC) IBR Indicator-Based Reform IBRD International Bank for Reconstruction and Development ICN International Competition Network ICT information and communication technologies IDA International Development Association IFC International Finance Corporation IMF International Monetary Fund IPP Investment Policy and Promotion IRM investment reform map; investment reform memo ITO/BPO information technology and business process outsourcing JAMPRO Jamaica Promotions Corporation JIC Jordan Investment Commission KM knowledge management LAC Latin America and Caribbean Region, World Bank Group M&E monitoring and evaluation MCICP Multi-Country Investment Climate Program MCP Markets and Competition Policy continued on next page FIAS—THE FACILITY FOR INVESTMENT CLIMATE ADVISORY SERVICES 86 Annex 4 : ABBREVIATIONS (continued) MCPAT Markets and Competition Policy Assessment Tool MIGA Multilateral Investment Guarantee Agency MNE multinational enterprise MSE; MSME micro and small enterprises; micro, small, and medium enterprises MTI Macroeconomics, Trade and Investment Global Practice, World Bank Group NCC National Competitiveness Council NQI National Quality Infrastructure OECD Organisation for Economic Cooperation and Development OECS Organisation of Eastern Caribbean States OHADA Organisation for the Harmonization of Business Law in Africa P4R Program for Results PCR Project Completion Report PDP product development project PMR product market regulation PPD public-private dialogue QI quality infrastructure RAS Reimbursable Advisory Services SARL société à responsabilité limitée (type of limited liability company) SARTI IP South Asia Regional Integration in Trade and Investment Promotion project SAS société par actions simplifiée (type of limited liability company) SCM synthetic control method SDGs Sustainable Development Goals SHGB Supporting High-Growth Business program SICRP Somalia Investment Climate Reform Program SIRM systemic investor response mechanism SME small and medium enterprises SOE state-owned enterprise SURP Somali Urban Resilience Project UNCTAD United Nations Conference on Trade and Development We-Fi Women Entrepreneurs Finance Initiative WEF World Economic Forum WRS warehouse receipt system WTO World Trade Organization Through the FIAS program, the World Bank Group and donor partners facilitate investment climate reforms in developing countries to foster open, productive, and competitive markets and to unlock sustainable private investments in sectors that contribute to growth and poverty reduction. The FIAS program is managed by the Equitable Growth, Finance & Institutions Practice Group of the World Bank Group. For more information, visit www.worldbank.org/fias