Good News From Kosovo

In their historic visit to the United States, Kosovo’s President Fatmir Sejdiu and Prime Minister Hashim Thaci proudly detailed the benchmarks achieved by the new republic since declaring independence in February 2008. The former Yugoslav entity and UN transitional protectorate can now usher in with dignity a peaceful and prosperous century following conflict throughout the 1990’s. Although there are many challenges affronting the young nation in achieving universal recognition both leaders remain optimistic for the bright future of Kosovo. On July 22, the couple met with some of Washington’s brightest at CSIS to present their triumphs, setbacks and concerns.

President Sejdiu began the event by stressing the importance of crafting a “peaceful definition” of Kosovo to help garner international support and respect for the new nation. Its new constitution, Sejdiu insists, will push Kosovo in this direction. Just approved in June, this charter is strongly based on both the principles guiding other democratic constitutions and Athisaari’s comprehensive proposal to create a decentralized and multi-ethnic society. The new constitution strikes a balance between offering Kosovo Albanians independence and granting Bosnian Serbs extensive rights, a compromise which will further the nation’s agenda of fostering privileged relations with Serbia. Although Sejdiu speaks sanguinely of Kosovo’s progress, he is quick to list road blocks from Russian and Serb forces.

Even though many opportunities await the new nation, its future as a democratic and peaceful republic will be hugely dependent on coordinated international efforts and investments. To ensure the success of collaborations, Prime Minister Thaci stressed the importance of combating the perception that Kosovo’s government is corrupt. His proposal: accounting for all internationally pledged money to rebuild the nation, and strengthening the position of the Serb minority both in government and civil society. Only then will Kosovo receive the aide and guidance it needs to strengthen its economy and make a smoother transition into self-dependence.

There are serious obstacles facing new leaders, such as the looming fear of dissent in Northern Kosovo; but President Sejdiu assures that his presidency has the determination to settle them both peacefully and diplomatically. With heightened support from individual nations as well as membership in international bodies like the World Bank on the horizon, both Sejdiu and Thaci believe that Kosovo’s progress will surpass all initial expectations.

Sponsor: CSIS
Date: July 22, 2008
Time: 10-11 am
Representative Attending: Elizabeth Caniano

Broadcasting, Voice and Accountability

Media plays an important political role by publicizing government actions, providing checks and balances to those actions and giving citizens an outlet for expression. These functions are particularly important in developing countries, where fledgling governments struggle to find a balance between maintaining control and improving quality of life for their citizens. To facilitate the role of the radio and television in development, the World Bank published “Broadcasting, Voice and Accountability: A Public Interest Approach to Policy, Law and Regulation.” Steve Buckley, Kreszentia Duer, Toby Mendel and Seán Ó Siochrú, authors of the book, explained its purpose and importance to development efforts at a recent launch event.

The book outlines the key elements of effective broadcasting regulations, and provides examples of best practices from a wide range of countries. It is intended to help governments increase the amount of unrestricted, community-based broadcasting that promotes public interest.

Broadcast media is critical to development because it increases social engagement. Through news reports, citizens can be more informed about both their country and their government’s actions. At the same time, they can fight back against government actions that they oppose. Eric Chinje, one of the evaluators of the book, shared his experiences of the power of media at a television station in Cameroon in the 1980’s. After just one year of widespread television programming, the citizens of Cameroon knew much more about the different regions of their country and developed a stronger sense of national identity. Later, his TV crew broadcasted footage of numerous government and military officials disobeying traffic laws. Soon after this story aired, the previous traffic safety problems became almost nonexistent.

The public must have the opportunity to create independent radio and television stations that broadcast freely in order to hold their governments accountable. This book, with its combination of recommendations and case study examples, offers guidance for developing countries to create a media that is organized under law but still offers an atmosphere of free expression.

Sponsor: The World Bank Infoshop
Date: June 17, 2008
Time: 10:00am – 12:00pm
Representative Attending: Kate Lonergan

Evaluating the “Doing Business” Indicators

The "Doing Business" indicators are an annual ranking system compiled by the World Bank to assess the ease of doing business in over 178 countries. These rankings are often used as an indication of development progress; accordingly there is substantial concern about the accuracy of the report and the composition of the different indicators. To address these concerns, the Independent Evaluation Group (IEG) conducted their own assessment of Doing Business’ methodology. The report was recently released at a World Bank discussion, where various experts from IEG and the World Bank shared their thoughts about the Doing Business indicators.

IEG’s report looked at what the indicators really measure, how the evaluations are constructed, and how the rankings are used. Victoria Elliot, the main author of the report, gave an overview of her group’s findings. They developed four core recommendations for the World Bank’s Doing Business team:

1. Do not overstate the indicators’ scope and explanatory power. IEG felt that the Doing Business report was limited because it only examined some factors affecting performance. Their indicators addressed less than half of the constraints reported by business owners.
2. Incorporate more informants into data collection. The report found that Doing Business mostly relied on law firms to provide information about official policies and restrictions, and gave very little attention to the experiences of actual business owners.
3. Disclose data changes and ranking updates as they’re made. Updates to the data in the Doing Business report drastically changed some countries’ rankings, but these changes were not widely publicized. Consequently, some countries who improved their practices still face the stigma of a low Doing Business ranking.
4. Simplify the “Paying Taxes” section of evaluation. IEG recommended that the World Bank remove the tax rate from this ranking. They also criticized the dependence on the Price Waterhouse Cooper firm in obtaining data about paying taxes.

Other commentators generally agreed that the Doing Business report provides useful information, but it is far from perfect and should not be used as a definitive judgment of economic progress in developing countries. Francois Bourguignon, former director of the World Bank, cautioned against relying too much on the indicators both because they do not show progress within a country and because the criteria for evaluation are based more on intuition than rigorous economic analysis. At the same time, he applauded Doing Business for sparking a dialogue about business regulations in developing countries. Dennis DeTray, Vice President for Special Initiatives at the Center for Global Development, emphasized the limitations of a report that tries to apply the same standards to a wide range of countries. Each economy has its own unique considerations, and attempting to set standardized goals for development may be more harmful than helpful.

Penelope Brook, head of the World Bank team in charge of the Doing Business indicators, also had the opportunity to respond to criticisms of the rankings. She thanked IEG for their recommendations, but upheld certain aspects of the original report. She defended the inclusion of the “Paying Taxes” indicator, because the tax burden can be a significant obstacle to new businesses in some countries. Ms. Brook also explained that the team relied on data from law firms because they felt it was the most efficient way to gather a uniform and accurate assessment of regulations. Finally, she reminded the audience that the Doing Business report aims to explore ways to construct effective and pertinent business regulations that will reduce the size of the informal sector in developing countries. It is not an all-encompassing document, and the assessment is only designed to judge how hard or easy it is to open a business in developing countries. Ms. Brook echoed the other commentators’ sentiments when she stated that the Doing Business indicators should be catalysts for reform, not guidelines for policy changes.

Sponsor: The World Bank and the Independent Evaluation Group
Date: June 12, 2008
Time: 10:00am – 12:00pm
Representative Attending: Kate Lonergan