PublicPrivate Dialogue For Sector Competitiveness 5 th PPD

Public-Private Dialogue For Sector Competitiveness 5 th PPD Workshop June 2, 2010 Vienna Benjamin Herzberg Uriel Levy Amy Cogan Wares World Bank Group PPD Global Product Team 1

National PPD with Sector Component Sectoral WG are common in national PPDs Herzberg, Levy, Wares, 2010 2009 PPD review by Malcolm Toland 2

National PPD with Sector Component Works well with removing administrative burdens but perhaps limited impact in terms of sector competitiveness – Large companies tend to abandon the WG process along the way – Heavy set-up tends to burn political capital quickly – Limited information sharing unless feel extremely secure or obvious benefits – PS gathers in order to remove direct constraints (e. g. business environment) Herzberg, Levy, Wares, 2010

Move toward Competitiveness… Partnerships Competitiveness is restrained by six basic structural factors. Isolated competitiveness exists, but highly competitive firms limited to isolated first movers, innovators, sometime foreign link. Some competitiveness in firms benefiting from conjuncture but hardly sustainable. Herzberg, 2010 Herzberg, Levy, Wares, 2010

…through competitiveness partnerships Skills – Labor - HR f Regulations Taxation Technology Innovation – R&D e e f e f d d c b d e d d cb. A b c b d c c d b f e e e f b f c d Competi- b A c tiveness c Partnership b b b c f f e d c d Financing External Factors f e b d c e d f e f Herzberg, 2010 Infrastructure Competitiveness partnership initiatives are a tool to discover and address structural gaps in competitiveness environment beyond individual firms. They help devise sound industrial sector policy. Gaps are identified and addressed through coordinated joint actions. The CPI results in bringing a group Herzberg, Levy, Wares, 2010 of lesser performing individual firms to “A” level. 5

…through competitiveness partnerships Skills – Labor - HR f Regulations Taxation Technology Innovation – R&D e e f e f d d c b d e d d cb. A b c b d c c d b f e e e f b f c d Competi- b A c tiveness c Partnership b b b c f f e d c d Financing External Factors f e b d c e d f e f Herzberg, 2010 Infrastructure Competitiveness partnership initiatives are a tool to discover and address structural gaps in competitiveness environment beyond individual firms. They help devise sound industrial sector policy. Gaps are identified and addressed through coordinated joint actions. The CPI results in bringing a group Herzberg, Levy, Wares, 2010 of lesser performing individual firms to “A” level. 6

Where do you start? • Where is there latent competitive advantage (in which sector? ), which a CPI would reveal? • What specific gaps can a CPI bridge for given sectors and what opportunities exist for joint actions that will improve competitiveness? • What is the process to construct and implement the CPI action plan? Identify Opportunities Analyze and Diagnose Create Action Plans Implement Action Plans Herzberg, Levy, Wares, 2010

Identifying opportunities Competitive Potential + Feasibility of CPI Herzberg, Levy, Wares, 2010

Sector structure? Herzberg, Levy, Wares, 2010

Identify specific constraints Skills – Labor - HR f Regulations Taxation Technology - Innovation – R&D e e f d e c c b b d f f d c b A b d c b b c c e d d e e f Financing External Factors f Infrastructure Herzberg, Levy, Wares, 2010

Supply chain constraints + FDI potential? Herzberg, Levy, Wares, 2010

From diagnosis to joint action • Conduct research based on scientific approach • Participatory approach to communicate research findings - Workshops with private sector, government, others • Identify joint actions that will improve competitiveness • Prioritize and implement action plan Herzberg, Levy, Wares, 2010

Types of actions • • Feasibility studies Benchmarking Market information Joint promotion, FDI attraction Research partnerships (university/skills) Specialized infrastructure, financing, training Emphasis on activities with spillover effects Actions Action Groups Structure to support those and future Action Groups • CPI set up, financing, organizational process Herzberg, Levy, Wares, 2010

Structure to support action PPD WG Group 1 WG Group 2 Tourism WG Kenya Tourism CPI Beach Action Groups Convention AG Safari AG AG Herzberg, Levy, Wares, 2010 AG AG

Structure to support action PPD WG Group 1 WG Group 2 Tourism WG CPI Finance Action Groups Regulations AG Skills AG AG Herzberg, Levy, Wares, 2010 AG AG