Gridlock No More How Regional Cooperation Accelerate Regulatory Reform
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Transcript of Gridlock No More How Regional Cooperation Accelerate Regulatory Reform
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Gridlock No MoreHow Regional Cooperation Accelerate Regulatory Reform
The Case of Passenger Transport Sector
Pich Nitsmer, Ph.D.
26 February 2007
Fiscal Policy Research Institute, Thailand
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Presentation Outline
Policy and Regulatory Process
Why sub-optimal? How to reform?
Regional Cooperation Which forums and channels? What to be gained?
perhaps with the support of …
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National Economic and Social Development Board
5-year National
Plan
1) Transport Ministry
2) A Ministry 20) B Ministry
Transport 5-year Plan
Transport & Traffic Policy & Planning
Office
…
A Policy & Planning
Office
Transport
≠
Thailand’s Policy Process: Top-down
Policy X
Implementation
Incompetence
Interference
Sub-optimal
Outcome
B Policy & Planning
Office
Policy Y
Policy Z
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Department (e.g. Land Transport Dep.)
Regulatory Process: Non-linear, Multi-agent
Reg. Action Imposed on Operators
Internal
Internal: Safety, security & scheduling External: Price, coverage & social requirement
External
Commission (e.g. Land Traffic Commission)
Transport Permanent-Sec.
Land Transport Director-General Police Commissioner-General Bangkok Governor
Problems
Limited regulatory expertise
Lack of inter-ministerial cooperation
Resistance from vested interest
Interference from rent-seeking public officials
Can’t serve as check &
balance tool b/c conflict of
interest
External
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Regulatory Reform: Competition Enhancement
Risks of Privatization w/out Effective Regulatory Regime
Shares majority-owned by govt continued govt interference
Share distribution through IPO ‘unfair’ capture & rent-seeking
Operation unregulated imbalance of economic & social ends
Short-term Implications To facilitate competition before privatization (e.g. quality standard & target for phasing out subsidy)
To strengthen regulatory muscles regardless of privatization
How?5
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Reform: Independence and Other Conditions
Regulatory Independence: Separation from Operation & Policy
Commission: Centralised? Enabling factors (e.g. regulatory capability): How?
Regulatory Check-and-Balance
Regulatory Impact Assessment (ex-post & ex-ante) Transparency & Accountability
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Regional Cooperation: the Case of APECExpected Benefits from Regional Forum Capacity building: Experience & expertise sharing (existing) Regional institutional building: Developing regional vehicle for independent policy evaluation (not yet materialised)
Bangkok Conference (2007) Proposal
Hadi Soesastro: ‘Establishing an ongoing APEC Productivity and Efficiency Commission … that has the capacity to respond to requests by APEC and member economies for analysis of micro- policy and regulatory issues’.
Existing Mechanisms?7
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APEC Channels: Existing Mechanisms
Trade & Investment Committee(Issue-specific - focusing on
deregulation)
Transportation Working Group(Sector-specific)
Economic Committee(Issue-specific - focusing on
reform)
Possible Interactive Channels
Business Advisory Council(Facilitator)
Organisational Structure
Leaders’ Meeting
Ministerial MeetingBusiness Advisory Council Sectoral Ministerial Meeting
Working Groups (11)- TransportationEconomic Committee
Trade & Investment Committee
Experts Groups (11)- Competition & Deregulation 8
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Economic Committee: Issue-specific
LAISR Thematic Work Plan
Mandate To promote structural reform by undertaking analysis & action- oriented work
Principle Leaders’ Agenda to Implement Structural Reform (LAISR)
Priorities in regulatory reform, economic & legal infrastructure, competition policy, governance & public sector management
Capacity Building
Studies based on APEC-OECD Checklist on Regulatory Reform Seminars on competition policy as a sub-set of structural reform
Year 2005
2006
2007 2008 2009
2010
Focus Issue
s
Regulatory reform-Sector specific (e.g. transport)
Economic & legal infrastructure
Stocktake of progress on reform
Public sector governance
Competition policy
all relevant to transport 9
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Trade & Investment Committee: Expert Group
Mandate To enhance region’s competitive environment Principle Principles to Enhance Competition & Regulat
ory Reform Strengthening the functioning of markets
Capacity Building
Technical assistance & training in competition policy & regulatory reform Competition policy & deregulation database
Expert Group in Competition Policy and Deregulation
Function Overlapping?
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Transportation Working Group: Sector-specific
Mandate
To achieve liberalisation of transportation services & to encourage sectoral - development in Asia Pacificwhile balancing safety, security & social objectives, thus focusing on facilitation of domestic policy regulation
Principle
2004 Transport Ministers Statements
Ensuring a safe, secure, efficient, integrated and environmentally sustainable transportation system for the region
Capacity
Building
Symposium on Intelligent Transport System Accessibility
Very sector-specific but unrelated to the realm of regulation?
How to integrate sector-specific with issue-specific mechanisms then?
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Conclusion: Implications for Transport Value Chain
Terminal Infrastructu
re
Vehicle
Construction Supply
Operation Operation
regulated
what about here?
mostly state-run
Capacity building through regional cooperation is also needed for procurement process to reduce interference & develop local
suppliers along the chain.
Component
system integration
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End of Presentation … Thank You
Ari Skytrain Station – 10 minutes from the FPRI
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