European Union Finance Ministers Tell Greece to Control its Public Deficit

Brussels - European Union finance ministers told Greece it had to take immediate steps to control its public deficit, which they said had consistently exceeded eurozone regulations. "It is of paramount importance that the Greek government comply fully and rapidly with budgetary discipline in support (of) the single currency," the ministers concluded. They said that revised data submitted by Athens showed "that budgetary deficits have been consistently above the reference value," which under the Maastricht Treaty on European Union is three percent of annual gross domestic product. But the ministers in effect pardoned Greece for massive upward revisions to the shortfall, acknowledging "that part of the revisions reflect the uncertainties in the transition to the new ... methodology introduced at the time of the March 2000 fiscal notification."

In Athens, Greek Finance Minister George Alogoskoufis pledged to bring his country's deficit below the EU Stability and Growth Pact's limit by 2005 and to improve the quality of its budget data. "We are fairly confident Greece will be below three percent of GDP in the year 2005," he said. Greece's euro-entry in 2001 was largely based on the country's 1999 public deficit which, according to budget data presented by Greece in 2000, stood at 1.8 percent of gross domestic product. But after taking office in March the country's conservative government voluntarily revised the post-2000 figures, revealing that the public deficit had consistently breached the three-percent-limit since that year -- contrary to figures of its socialist predecessors who had ruled Greece since 1993.

EU Economic Affairs Commissioner Joaquin Almunia, confirming earlier reports from Greek officials, said Monday it had been determined that Greece also failed to respect the three percent threshold between 1997 and 1999, the years on which its admission to the eurozone had been based. While the country's membership in the eurozone is not threatened, the finance ministers nonetheless vowed Tuesday to determine where responsibility lies for the inaccurate data. Greek in early November provided the EU executive commission with planned budget cuts designed to reduce the public deficit from 5.3 percent of output in 2004 to 2.8 percent next year. Alogoskoufis rejected Tuesday suggestions that European Central Bank vice president Lucas Papademos, who headed Greece's central bank at the time of its euro entry, should resign. "Not at all," he said when asked if Papademos should step down. "The Bank of Greece was presenting data over many years that showed there were problems with the government data," he said.

Channel News Asia, Singapore, 17 November 2004

Building State Capacity for Good Governance in Africa Requires a Paradigm Shift

If Africa is to have a well-functioning public sector, there needs to be a paradigm shift in how to analyze and build state capacity. Specifically, African governments and their partners should move from a narrow focus on organizational, technocratic, and public management approaches to a broader perspective that incorporates both the political dynamics and the institutional rules of the game within which public organizations operate. This is the core message in a new book from the World Bank, Building State Capacity in Africa: New Approaches, Emerging Lessons. Launching the book in Washington, Frannie Leautier, World Bank Institute Vice President, said: "Where countries have a workable baseline of civil service capabilities and a visionary leadership, possibilities exist for a comprehensive program of capacity building. The administrative reforms in Tanzania and the extensive decentralized capacity building in Uganda are good examples.'

The book draws from the experience of a new generation of initiatives started in the 1990s in more than a dozen countries after decades of failed efforts. It provides pointers on how to align a capacity building strategy with country-specific realities, pointing to the need for a hopeful realism: recognizing that although building effective and accountable states is a centuries-long process, small beginnings can set in motion progressively more profound consequences. Some key lessons: * In reforming state institutions, get the right fit-It probably won't work unless you face the realities on the ground. Institutions that underpin systems of accountability are country specific, so that undifferentiated, "best practice," cookie-cutter approaches are doomed to failure. Any efforts to strengthen administrative and accountability systems will have to fit country-specific constitutional structures and patterns of political, social and economic interests.

* Align a capacity building strategy with country-specific realities. Building states that are both effective and accountable to their citizens is a centuries-long process. But small beginnings can set in motion progressively more profound consequences.

* If the country does not have bureaucratic and institutional capabilities, comprehensive reforms may not be the answer. It may be preferable to focus on more modest, viable initiatives, especially those for which results are observable. For example, if you can't fix the whole government, getting community schools to work may spearhead more reforms down the road.

* Public administrations operate in complex and interdependent systems of bureaucratic, political, social, and economic interests, so that approaches to building state capacity must take into account the underlying drivers of political and institutional change. These approaches complement the earlier and narrower technocratic view that problems are due to poor management and can be fixed by reorganizations, providing technical training, and installing hardware.

* In Africa, the record of reforms has been mixed. A survey of World Bank operations in twenty-one African countries showed far-reaching gains in public administrative capacity only in countries with a strongly pro-development political environment.

* Lessons from the last six years also show that the roots of corruption lie in dysfunctional state institutions. Anticorruption campaigns can play a valuable role but only when used in tandem with institutional interventions.

It is now generally agreed that poor governance and corruption are major factors that undermine a country's economic and social progress. Corruption not only stifles economic growth in society as a whole but also tends to affect the poor disproportionately by increasing the price for public services and restricting poor people's access to essential services such as water, education and health care. The editors, Brian Levy and Sahr Kpundeh note that: "We need to find a middle ground between the bipolar moods that have for decades plagued developmental theory and practice: exuberant optimism that some magic form u/a for development has been found, followed inevitably by deep disappointment over its limitations. This book describes a hopeful realism: recognizing that although only a few African countries will achieve major gains in the short term, irrespective of a country's initial circumstance, some way forward for building state capacity is there to be tapped. The book presents and analyzes recent experiences with supply side efforts to build administrative capacity (administrative reform, pay policies, budget formulation), and demand-side efforts to strengthen government accountability to citizens (role and impact of national parliaments, dedicated anti-corruption agencies, political dynamics of decentralization, education decentralization).

AllAfrica.com, Africa, Book Review by Brian Levy & Sahel Kp of Ghanaian Chronicle, 19 November 2004

HIV/AIDS Is Expected to Slash African Labour Force by 9 Percent by 2010 – United Nations

By 2010 sub-Saharan Africa's total labour force is expected to shrink by 9 per cent due to HIV/AIDS, with losses topping 20 per cent in the worst affected countries, a United Nations-organized workshop has been told. By 2015 these losses could reach up to 12 per cent overall, reducing the labour supply by as much 30 per cent to 40 per cent in the highest prevalence countries. Over 100 hundred representatives from the public and private sectors attended the two-day policy dialogue last week in Accra, capital of Ghana, organized by the UN Commission on HIV/AIDS and Governance in Africa (CHGA) in collaboration with ILO-AIDS, part of the UN International Labour Organization, to offer policy makers recommendations to reduce the impact of the pandemic on the continent's labour force. Workshop participants called for greater collaboration between the public and private sectors and emphasized the need for leadership from all major sectors of industry. The issue of access to treatment and care was also one of the key points of the discussions between representatives of the private and public sectors. CHGA is a UN system-wide initiative, involving partnerships with a number of UN agencies as well as leading institutions in Africa and internationally on aspects of research, policy and implementation.

UN News Centre, 22 November 2004

Cabinet Ministers Suspended After Congo's Parliament Alleges Corruption

Kinshasa, Congo (AP) - President Laurent Kabila suspended six cabinet ministers and 10 directors of state-run companies Thursday after a parliamentary inquiry alleged they had embezzled government funds. The crackdown targeted the ministers of mines, energy, transport and communications, higher education, public works and commerce, the presidency announced on state television. Parliament launched its inquiry after the government's accounting office issued a report in September denouncing suspected corruption in several government companies. The office had accused the directors of some state-run concerns of paying themselves monthly salaries of up to $37,650 Cdn and expensing exorbitant private vacations.

Since independence in 1960, top government officials have regularly been accused of stealing millions of dollars from the state treasury. Despite Congo's mineral wealth, Congo's almost 60 million people have remained among the world's poorest. Corruption during the reign of late dictator Mobutu Sese Seko was so bad, critics described the impoverished country as a "kleptocracy." Kabila has led a government of national unity since July 2003. The new government brought in leaders of rival rebel factions who signed a peace accord in late 2002 that largely brought an end to years of war.

CBC News, Canada, 25 November 2004

System Highlights Anti-corruption Measures

An anti-corruption system that lays equal stress on punishment and prevention is in the making in the context of the developing market economy. Putting education, system construction and supervision at its core, it is designed to prevent and combat corruption in government departments. The central government is considering making a regular analysis of the performance of leading officials to help build a clean government. Legal experts say legislation is needed to prevent and fight corruption. The supervisory system must be strengthened in order to restrict officials' abuse of power while laws and regulations related to combatting corruption are established, said Zhu Xudong, director of the Research Institute under Central Discipline Inspection Commission of the Communist Party of China. Zhu made the remarks at a conference entitled Strengthening the Punishment and Prevention Mechanism of Anti-Corruption organized by the Supreme People's Procuratorate in Beijing over the weekend. There should be strict supervision of major government departments in order to prevent leading officials from misusing their power, Zhu said. He pointed out that supervision must be intensified in the selection of officials, and the operation of financial capital and State-owned assets, adding that legal measures, auditing and supervision all have a role to play. "A sound and effective anti-corruption system should involve a series of interrelated mechanisms of prevention, restraint, punishment and self-discipline," Zhu said. To legislate against corruption should be one of the important tasks for the lawmakers in the period to come, he advised.

Highlighting the importance of the legal system in preventing and combating corruption, Professor Wang Mu from the China University of Politics and Law said a seamless system must be established to supervise government officials, including senior officials. Cheng Wenhao from the School of Public Management in Tsinghua University emphasized the role of education in preventing corruption, describing it as a long-term and strategic task. In the long run, life-long education promoting good behaviour and honest from childhood will help create a sound social environment for clean government. Corruption has been on the rise since China launched its reform and opening drive in the late 1970s. From 1998 to 2003, 36 officials at provincial and ministerial level were involved in corruption cases. And six officials at provincial and ministerial level and 537 officials above county level were punished for corruption in 2003.

The central government and the Party are taking a firm stand against corruption and their efforts to fight this scourge are also being assisted by international organizations. As China continues its rapid socio-economic transformation, transparent and efficient government becomes increasingly imperative to create an equal and fair society for all people, said an official from the United Nations Development Programme (UNDP). "We support China's efforts to develop a balanced and effective anti-corruption system and see the Supreme People's Procuratorate as having an important role to play in the new anti-corruption system," said Renaud Meyer, Deputy Resident Representative of UNDP's China Office at the conference. From 2002, UNDP launched a three-year legal system reform project to assist the nation's court, procuratorate and public security authorities to adopt and implement new rules and policies in deepening the legal system reform. Anti-corruption is an important part of the project. Thanks to the project, a working guideline on advocacy on the prevention of corruption has been formulated and key prosecutors from the anti-corruption bureaux of the procuratorates have been trained to enhance their legal skills and professionalism. "Our programmes support the government's efforts to strengthen transparency and accountability within the civil service and the judiciary through the development of specific anti-corruption legislation and codes of conduct and through independent mechanisms for oversight, monitoring and enforcement," Meyer said. With the UNDP's support, China actively participated in the drafting of the UN Convention on Anti-Corruption and signed the convention in December last year.

China Daily, China, by Cao Desheng, 14 November 2004

Procuratorates to Rotate Anti-corruption Chiefs

Beijing - China will soon begin rotating its anti-corruption chiefs of grass-root procuratorates regularly to step up crackdown on corruption, according to the Supreme People's Procuratorate. The move should help to safeguard the integrity of these officials and guarantee their personal safety, said Jia Chunwang, procurator-general of the Supreme People's Procuratorate. "Anti-corruption chiefs turning corrupt is a matter totally unacceptable to the public and it seriously impairs the credibility and esteem of the state power," a senior lawyer named Wu Shaozhi said. In 1999, Luo Ji, director of the anti-corruption bureau of the Supreme People's Procuratorate was removed from post because of serious violation of discipline. In recent years, a few anti-corruption chiefs of procuratorates in Guizhou, Jiangsu, Shanxi and Hunan provinces have also been found involved in corruption and punished. "The rotation system will prevent anti-corruption chiefs from being influenced by their social circles, which tend to grow as they stay longer in a place," said Jiang Lihua, deputy head of theState College of Prosecutors. "In addition, the system will help keep prosecutors away from the revenge of corrupt officials," he said.

Xinhuanet, Xinhua, China, 14 November 2004

Bangladesh to Tackle Corruption

Bangladesh has launched an independent judicial commission to fight corruption and improve its image abroad, it said. The new Anti-Corruption Commission was welcomed by Transparency International, a global group which combats corruption. But Transparency head, David Nussbaum, said he was not yet convinced the commission had adequate safeguards "in terms of composition and funding". Bangladesh was named as most corrupt country four years in a row in Transparency's annual survey. The survey relates to perceptions of the degree of corruption in differing countries, as seen by business people, academics and risk analysts. "A three-member anti-corruption commission, headed by a former High Court judge, was appointed late on Sunday," a government spokesman said in Dhaka.

Major step - Foreign donors and investors in Bangladesh had been urging the government to establish an independent anti-corruption body - free from political bias and administrative influence, officials said. Septuagenarian Justice Sultan Hossain Khan, a retired High Court judge and former chairman of the Bangladesh Press Council, will chair the three-member Commission. The other two members are Professor Maniruzzaman Miah, an ex-vice chancellor of Dhaka university, and retired civil servant Maniruddin Ahmed. Mr Ahmed is a former chairman of the country's capital market regulators, the Securities and Exchange Commission. The formation of the commission is seen as a major step towards fighting against corruption.

'Foot-dragging' - "We're very encouraged by the prospect of this being developed," said David Nussbaum, managing director of Transparency International. "We were involved in helping the government set up its anti-corruption legislation. " However, he added: "But there has been some foot-dragging in getting the commission set up and the government need to demonstrate that they are fully committed to it." Bangladesh's finance minister, Saifur Rahman, said the country was paying a heavy price for being branded as a corrupt country. He said this week the country was deprived of a $300m development fund from the American Millennium Challenge Account because of the "corrupt" label. The commission has been empowered to deal with all corruption-related complaints, whether against bureaucrats or against government ministers. Before the creation of the commission, Bangladesh had an anti-corruption bureau, now dissolved, under the direct control of the Prime Minister's office. The body often faced criticism of being too weak to investigate allegations, especially against politically influential people.

Skeptical opposition - Opposition parties, like the Awami League, have questioned the neutrality of the new commission. The league leaders say the body was formed with people who are closely linked with the governing Bangladesh Nationalist Party. Mr Nussbaum said two things needed to change before Bangladesh's reputation would improve. "Firstly, it needs to tackle corruption more rigorously. Secondly, the government needs to communicate the steps it is taking. "People's perceptions are influenced by what they hear as well as what they see, but in the end the reality must change for perceptions to change."

BBC News, UK, 22 November 2004

Prevention - Strategic Priority in Fighting Corruption

Ha Noi - Vietnamese General Inspector Quach Le Thanh emphasised the need to consider prevention as a strategic priority in combating corruption at an international workshop on corruption which opened in Ha Noi on Wednesday. In his address sent to the workshop, Thanh also underlined the urgent need to formulate and implement an anti-corruption strategy that focuses more on prevention. The two-day workshop, jointly organised by the Government Inspectorate and the United Nations Development Programme (UNDP), is deliberating the endeavour to fight corruption from both global and local perspectives. The outcomes of the workshop will be input into the process of ratification and implementation of the UN Convention Against Corruption, signed by Viet Nam in December 2003, towards the development of a long-term national strategy on anti-corruption in the country.

Speaking at the opening session, UNDP Resident Representative, Mr Jordan Ryan noted, the negative impact of corruption on development, saying "Corruption hinders economic development, reduces social services, and diverts investment in infrastructure, institutions and social services. That further widens inequality and undermines efforts to achieve the Millennium Development Goals." Ryan highlighted the importance of the workshop, saying that since is organised prior to the 12th Consultative Group Meeting for Viet Nam scheduled for early December, the result of the workshop will be extrembly significant in attracting more foreign investment into Viet Nam.

He said Viet Nam is in the process of drawing up numerous legal documents relating to the fight against corruption, however, it needs to persuade the people to fight corrupt behaviour. At present, the formation of a legal framework for global cooperation in preventing and countering corruption is an urgent requirement of the entire international community. After seven rounds of talks on the issue that were held during the 2001-03 period, a high-level political meeting on the signing of the UN Convention Against Corruption was held in Mexico on Nov. 9, 2003 with Viet Nam being one of the participants and also one of the first countries that signed the Convention on Dec. 10, 2003.

BBC News, UK, 22 November 2004

Vietnam Pledges to Promote Implementation of Development Triangle

Ventiane - Prime Minister Phan Van Khai pledged to closely cooperate with relevant counties in the effort to establish the Cambodia-Laos-Viet Nam development triangle, which will help promote economic development, poverty alleviation and cultural and social progress in the area. Addressing a meeting of Prime Ministers of Viet Nam, Laos, and Cambodia in Vientiane on Sunday, PM Khai said the three countries should mobilise all internal strengths and give the highest priorities to the triangle to facilitate development in the region, while creating a favourable environment for businesses to attract the investment of localities and businesses inside and outside the triangle. He asked relevant ministries, services and localities of the three countries to cooperate in making proposals to the leaders of each country for concrete mechanisms and preferential policies for the triangle.

According to the PM, the three countries should build an effective mechanism for coordination at central and local levels. He asked each country to consider the establishment of a coordination committee to give advice to the leaders of the three countries in matters relating to the triangle, ensuring close cooperation among the three countries in its construction. The coordination committees of the three countries will urgently work out a plan and roadmap on implementation, to ensure that the plan will be implemented correctly and meet the set requirements. The PM said the three countries should closely cooperate to take synchronous measures to mobilise resources for the implementation of projects which have been agreed upon within the master plan, while promoting coordination to ensure security for each country, along with socio-economic development. The PM praised the three countries' cooperation since the formation of the initiative to establish the Development Triangle in 1999. He expressed his belief that, after the meeting, the three countries will promote coordination in devising concrete plans and programmes to implement the Vientiane Joint Declaration on building the Development Triangle. PM Khai also suggested that the Coordination Committees of the three countries cooperate with Japan to devise a role for Japan in the construction of the Development Triangle. (VNA-TNA)

http, Thailand, 28 November 2004

Corruption the Biggest Hurdle in Achieving Good Governance: Pak Law Minister

Lahore - Pakistan's Minister for Law Mr. Wasi Zafar has said that corruption is the biggest hurdle in achieving the goal of good governance in the country. He was addressing the second-day session of "International Conference On Combating Corruption in South Asia" in Lahore on Friday. He said that the present Government's seriousness to curb the corrupt practices is evident from the number of measure taken, from initiatives in judicial Sector, Anti-Money Laundering Law, Access to Justice Programme & Benami Accounts Law etc. Emphasizing the role of Media in combating corruption the Minister said that in Pakistan Media presently is freer than some of the established democracies of the world thus it can effectively play its role of highlighting the corrupt practices albeit in Government or Private sector.

He supported the idea that regional and local Press Councils should be empowered to receive complaints against excesses of the media as well and emphasized the need for self-regulation. He said that the civil society in Pakistan must play its due role in combating corruption. He said that SAARC Council/Committee Against Corruption could play a very effective role in curbing the menace of corruption. He stated that cooperation between Anti-corruption Agencies in terms of exchange of information and experience, training of personnel; simplify mutual legal assistance in the cases of corruption, interaction of the civil society organisations could be highly beneficial for the countries of South Asian Region. He also expressed his support for the anti-corruption efforts taken by NAB and promised to work actively for NACS recommendation in his ministry.

Mr. Jeremy Pope Co-Director, Tiri (the governance-access-learning network) while addressing the session said that a free media ranks alongside an independent Judiciary, as one of the two powers that should never be accountable to politicians. Both serve as potent counter-forces to corruption in public life and both must receive special protection. Mr. Jeremy Pope while emphasizing the role of civil society in countering corruption with special reference to the media said that unlike judges, public prosecutors and Attorney-Generals, the privately-owned media is not appointed or confirmed in office by politicians. Without a free media, civil society is crippled, both by a lack of information and an inability to engender public debate. He said that the role of civil society in demanding accountability from government "involves the most basic questions about power, transparency, participation and democracy".

The top-down and closed structure of state-controlled and autocratic governments in many countries has, in the past, stunted the growth of civil society and permitted public officials to operate in an atmosphere devoid of public accountability or transparency. He said that in any national strategy the professions – a part of civil society – must also play their part. Corruption and incompetence among lawyers, doctors and engineers inflicts considerable damage on many societies, and the professions need to take firm action to discipline their own members – or have a government agency do it for them. Defining the Principles of a free media Mr. Jeremy said that international standards require that governments should embrace a basic set of principles to shape approaches to the media. In general these argue against legislation and restriction.[v] An example is set out in the Charter for a Free Press approved by journalists from 34 countries at the Voices of Freedom World Conference on Censorship Problems.[vi] The then-United Nations Secretary General, Boutros Boutros-Ghali, declared that "They (the Charter'ss principles) deserve the support of everyone pledged to advance and protect democratic institutions". He added that the provisions, while non-binding, express goals"to which all free nations aspire".

Talking about the issue of Censorship and Accountability he said that the critical factor in all issues concerned with restricting freedom of the media is that the limits be publicly debated and that they be interpreted by a fully independent judiciary, composed of individuals of the highest integrity. However, in many emerging democracies the media's experience is limited and the temptation to be less responsible is significant. Laws that, in essence, provide full scope for the media to be irresponsible, may actually damage the growth of these emerging democracies, he added. Concluding his remarks Mr. Jeremy said that Pakistan, as it emerges from turbulent phases of its history, needs to ensure the growth of a vibrant civil society, with access to information and with access to the media to foster debate and to hold the agencies of government to account. He said that in this phase of the country'ss history, the professions must work diligently, openly and honestly to promote professional standards, be they in the fields of health, education, accountancy, engineering, the media or the law. A particular onus, however, falls on the lawyers. They have the power to put their own house in order, and if international reports are any guide, the situation is little short of scandalous. In the absence of "Rule of La", the best intended efforts of public-spirited politicians and officials would bear little fruit.

Mr. Desmond Fernando while presenting his paper on Scope for Regional Co-operation said that South Asia region urgently needs to deal with the problem of corruption. Not only does South Asia consist of poorly developed countries but it also has an enormous number of people who live below the poverty line. He said that unfortunately all our countries have very serious problems of corruption. According to Transparency International Corruption Perception's Index, Sri Lanka is the 70th most corrupt country. India is the 90th most corrupt country. Nepal is the 93rd most corrupt country. Pakistan is 132nd most corrupt country and Bangladesh is the 145th most corrupt country. Referring to the United Nations Convention against Corruption he said that the Convention against corruption is perhaps the best guide for considering the scope for Regional Co-operation. The fourth recital of the convention states "convinced that corruption is no longer a local matter but a trans-national phenomenon that affects all societies and economies, making international co-operation to prevent and control it is essential". He said that we hope that this Conference will lead to SAARC States and Civil Society also co-operating in this field. The scope of the UN Convention is set out in Article 3, namely the Prevention, Investigation and Prosecution of Corruption and the Freezing Seizure Confiscation and return of the proceeds of offences. He emphasized the need of reviving the value system that prevailed in South Asia inspired by Mahathma Gandhi, namely, simple living and high thinking. There has to be a restoration of this value system and leaders of both Government and Civil Society should be an example of simple living by their life style.

Shazadi Beg Barrister/ Judge- UK & Board member-TIRL while presenting her papers on Fighting Corruption, Strengthening The Rule Of Law said that Pakistan for the first time in its history it has focused on preventative issues, rather than just investigation and prosecution of offenders. She said that in the global movement against corruption, we are now entering the most challenging phase of all-implementation and enforcement of standards. Strengthening the Rule of law will substantially contribute towards restoring the legitimacy of state institutions and an improved environment for economic growth, she added. Shazadi Beg said that State failure is often interwoven with state corruption, which not only drastically reduces efficiency and effectiveness of service delivery, but also breeds distrust among the poor who encounter it. She said that UN Convention against Corruption recognises the role of an independent judiciary in combating corruption. The legal system should provide the machinery whereby corruption is checked and punished. Yet, the legal system continues to fail to provide remedies for wrongs done, and is itself deemed to be corrupt. She said that NACS rightly recognises that a citizen's first experience of corruption in the judicial process is likely to be on encountering the legal profession. The Bar is seen as a partner to corruption in the legal system. The lawyers are viewed by the general public as virtually having no ethics. Bar Councils exercise very poor control over standards in the legal profession, she added.

Pakistan Link, CA, USA, 26 November 2004

Romania Bogged in Battle with Corruption

Bucharest - Romania's bid to join the European Union in three years is being hobbled by systemic corruption in all levels of life, the International Herald Tribune reports. "Corruption is pervasive," said Oana Zabava, executive director of Transparency International Romania. "Everybody pays bribes -- to doctors, teachers, nurses and to officials." Corruption has become the most contentious issue in negotiations between Romania and the EU, with particular concern about the judiciary, where lack of transparency and interference by the executive are at issue. There is wide public concern with the huge backlog of cases that has built up since legislation was passed after 1989 to return to its original owners property confiscated by the communist regime. Cristian Diaconescu, who was appointed justice minister in March after intense criticism from the EU about Romania's failure to reform the judiciary, said the administration in Bucharest had failed to act quickly on the property issue because it lacked political will to resolve the claims. "There are now 2.3 million outstanding court cases," he said. "That affects a lot of Romanians and colors their view about the administration."

Washington Times, DC, 24 November 2004

Embassies to Fight Corruption

New directives for Norway's embassies shall help curb those Norwegian firms that stoop to bribery in foreign markets.
Norwegian firms pay under the table - 25.11.2004. An article in newspaper Dagbladet on Thursday focused on a study that found four out of ten Norwegian firms that responded to the survey admitted paying bribes to help their export business. The report indicated that several embassies recommended that Norwegian firms follow local business practices, even if this meant using methods not allowed in Norway. "We are in the process of drafting instructions to embassies so that there shall be no doubt in such cases," deputy minister Olav Kjorven at the Ministry of Foreign Affairs told Dagbladet. "There is a need to emphasize to our embassies that Norwegian law is the standard for conduct for firms. But the sad reality is that this is difficult," Kjorven told the paper.

Aftenposten, Norway, 26 November 2004

The United Nations Convention Against Corruption

TPeru's President Toledo added his signature to the "United Nations Convention Against Corruption" during a signing ceremony held on Tuesday at UN headquarters in New York City, one week after Secretary-General Kofi Annan was accused by two U.S. Senators, Republican Norm Coleman, and Democrat Carl Levin, of "affirmatively preventing" their ongoing Oil-for-Food probe from obtaining "relevant" documents. On Wednesday, the Senate Committee revealed that during the 13 years of sanctions on Iraq the early U.S. $10-billion estimates that illegally filled Saddam Hussein's coffers through oil smuggling, kickbacks and surcharges were low - by half, finding instead that Saddam Hussein's regime siphoned closer to U.S. $21-billion. Negotiations for the United Nations Convention Against Corruption began in January 2002 after the UN’s General Assembly established an Ad Hoc Committee to create an "effective international legal instrument against corruption." The Ad Hoc Committee's mission was completed on October 1, 2003, and subsequently all States have been invited to participate, seven years after the now defunct UN's Oil-for-Food program began in 1996.

The preamble of the United Nations Convention against Corruption reads in part that the State Parties to this Convention are: "Concerned about the seriousness of problems and threats posed by corruption to the stability and security of societies, undermining the institutions and values of democracy, ethical values and justice and jeopardizing sustainable development and rule of law,

• Concerned also about the links between corruption and other forms of crime, in particular organized crime and economic crime, including money laundering;

• Concerned further rabout cases of corruption that involve vast quantities of assets, which may constitute a substantial proportion of the resources of States, and that threaten the political stability and sustainable development of those States;

• Convinced that corruption is no longer a local matter, but a transnational phenomenon that affects all societies and economies, making international cooperation to prevent and control it essential;

• Convinced also that a comprehensive and multidisciplinary approach is required to prevent and combat corruption effectively;

• Convinced that the illicit acquisition of personal wealth can be particularly damaging to democratic institutions, national economies and the rule of law, and is;

• Determined to prevent, detect and deter in a more effective manner international transfers of illicitly acquired assets and to strengthen international cooperation in asset recovery.”

Currently 113 countries have joined the United Nations Convention Against Corruption. Signatories include: Canada, the United States, Russia, Iran, France, Germany, China, Syria, Saudi Arabia, Turkey, Jordan, Libya, Afghanistan, Pakistan and the Netherlands.

On Wednesday, according to the Associated Press, the U.S. House International Relations Committee's latest findings tracked a multimillion dollar money trail to bank accounts in Jordan used by Saddam Hussein to pay families of Palestinian suicide bombers who attacked Israelis approximately $25,000 each using money from the UN Oil-for-food program. When the General Assembly adopted the United Nations Convention against Corruption on October 31, 2003, Kofi Annan issued a statement, "Corruption hurts the poor disproportionately - by diverting funds intended for development, undermining a government's ability to provide basic services, feeding inequality and injustice, and discouraging foreign investment and aid." Kofi Annan who is in Nairobi, Kenya could not be reached for comment. Earlier, the UN's director of communications, Edward Mortimer, described the charges leveled against Annan by the U.S. Senators as "very awkward and troubling" and added that the UN has provided all relevant documents to Paul Volcker's Independent Inquiry Committee for the United Nations Oil-for-Food program.

Canada Free Press has obtained a letter Paul Volcker sent to Kofi Annan and Senators Coleman and Levin: 'The policies of our Committee are designed to reconcile essential and desirable transparency and disclosures in our work with the need to conduct our investigation with the degree of confidentiality and simple fairness necessary in investigations into allegations of serious maladministration, misfeasance and personal corruption...What appears primarily at issue is the timing of such disclosures... We fully anticipate that the findings at that time [middle of next year] will be accompanied by release of substantially all documents relevant to those findings in the Committee possession." The United Nations Convention Against Corruption will not be ratified until early 2006. The probes into what has been described as 'Oil-for-Fraud' continue. Marinka Peschmann is a freelance writer whose first book collaboration, the best-selling The Kid Stays In The Picture; was made into a documentary. She's contributed to several books and stories ranging from showbiz and celebrities to true crime and politics.

Torontofreepress.com, Canada, by Marinka Peschmann, 19 November 2004

APEC Vows to Promote Good Governance

Santiago - The Asia-Pacific Economic Cooperation (APEC) forum said here Sunday that its members should step up efforts to fight corruption in order to promote good governance and to ensure sound economic cooperation in the Pacific Rim. "Corruption is a serious threat to good governance and deters investment. Therefore, fighting corruption is essential to the development of our economies for the benefit of our people," leaders from APEC's 21 members said in a statement issued at the end of their two-day annual meeting held here from Saturday to Sunday. At their last year's meeting in Bangkok, Thailand, the APEC leaders agreed on an anti-corruption deal in a bid to help members revitalize economic order. The leaders this year endorsed the Santiago Commitment to Fight Corruption and Ensure Transparency, and APEC Course of Action on Fighting Corruption and Ensuring Transparency. The leaders also activate an anti-corruption initiative, From Santiago to Seoul, to monitor and implement concerned plans of anti-corruption, according to the Santiago Declaration. Next year, the Republic of Korea will host all other APEC leaders from Australia, Brunei, Canada, Chile, China, Chinese Hong Kong, Indonesia, Japan, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, the Philippines, Russia, Singapore, Chinese Taipei, Thailand, the United States and Vietnam. Formed in 1989, APEC was designed to carry out plans of trade and investment liberalization in the Pacific Rim, but it broadened the scope of cooperation from economy to security and social reforms in recent years.

Xinhua, China, 21 November 2004

PM Warns Region on Corruption and Disease

Prime Minister John Howard today warned his South Pacific neighbours to fight corruption and the world's worst diseases as he and other leaders of the region focused on new ways to target terrorism. At the Asia-Pacific Economic Cooperation (APEC) summit in Chile, Mr Howard joined leaders from 20 other economies for their annual discussion on ways to boost trade and economic development across the region. But other issues, including the threat posed by North Korea and the fight against HIV-AIDS, clouded an already busy agenda which has so far failed to tackle a key demand from the region's businesses to quicken the pace towards free trade. Mr Howard, warning that the APEC agenda was being crowded by non-core issues, said it was vital to fight poverty by reducing trade barriers, especially for the region's poorest nations. Anti-globalisation protests were again held in Santiago today, with most anger directed against United States President George Bush and APEC's free trade policies. But the Prime Minister said the attacks were ill-conceived, as free trade would deliver millions of people from poverty. "For the developing and under-developed world, globalisation offers the only real hope of an escape from the poverty and adversity of the current experience."

APEC leaders are considering proposals to substantially toughen efforts to curb corruption, with Australia itself putting up $3 million towards efforts. Mr Howard, in a pointed comment to some of the South Pacific's struggling states, said those countries that failed to tackle corruption would find themselves being left further behind the rest of the world. "In a globalised world it is self evident, or it should be self evident, that nations with strong governance and an absence of corruption have a head start in attracting investment," he told reporters. "Investment in a globalised environment does pick and choose, and the capacity of countries to attract that investment whilst at the same time suffering poor standards of governance are greatly diminished." Mr Howard also said some of Australia's neighbours had to take tougher action to curb diseases such as AIDS and SARS. He said these type of diseases caused huge economic problems, but many countries lacked the conviction to mount tough public health programs. "The countries that have most success with public health programs are ones where there is a strong, clear no nonsense statement and very strong support for changes in behaviour.

Despite his relationship with Mr Bush, the prime minister today only exchanged a few words with the president - and almost all of those were about their recent election victories. Mr Bush spent most of the day talking to north Asian leaders about the nuclear threat posed by North Korea, and calming nations such as China that he will act on the growing US budget and trade deficits. "We just very briefly talked about the results of the election," was all Mr Howard would say of his conversation with Mr Bush. But he won more plaudits from other APEC members, who gave Mr Howard an applause in recognition of his October 9 election victory. The summit winds up tomorrow, with conversation expected to again focus on terrorism, and also a proposed APEC free trade area.

The Age (subscription), Australia, 20 November 2004

World Bank Ready To Fund Development Projects In Kashmir To Facilitate Peace


The World Bank is ready to fund development projects in Kashmir if that helps bring peace to the insurgency-wracked region, President James D. Wolfensohn said as he pledged $9 billion in aid to India over the next three years, reports The Associated Press. "We can be of help, but only after the political decisions are made," Wolfensohn said, referring to the continuing dialogue between India and Pakistan on ending their decades-old hostilities over Kashmir. For the peace efforts to succeed, India and Pakistan must focus on economic development of the Himalayan region, which has few industries and hundreds of thousands of jobless youth, he said. "Economic development along with peace is essential. When young people don't have economic hope, they tend to do all sorts of things," Wolfensohn said. "The role that the bank can play is to fulfill the economic hope of the people." Once India and Pakistan sort out their political differences, the World Bank can step in to fund development projects on both sides of divided Kashmir, he said. His comments came as Indian Prime Minister Manmohan Singh winded up a two-day visit to Jammu-Kashmir state, promising investment of up to 240 billion rupees ($5.3 billion) in various development projects over the next four years. Some of the money, he said, will come from international financial institutions. The funds would go to building new roads and schools, and developing infrastructure for water, power and health care. The initiatives are expected to create 24,000 new jobs, including 14,000 for women.

Asia Pulse meanwhile notes the World Bank on Thursday stressed the need for continuity in economic policies and implementation to speed up economic development in India. "It's a daunting challenge you face. You (people of India) have changed 4-5 governments in 10 years. If you stick to one policy then industry will respond," James Wolfensohn said, urging for the continuity of economic policies irrespective of the party in power. He said the government should promote public-private partnerships to speed up economic development. While appreciating the analysis and policies of Indian government, he said the implementation of the policies was more important. The Press Trust of India and Asia Pulse further report the World Bank Thursday promised to extend loans worth $9 billion to India in the next three years, most of which is intended for railway, power, road and water resource sectors. "We are prepared to extend $9 billion in the next three years or $3 billion annually," World Bank president James Wolfensohn said after a high-level meeting in Planning Commission. "What I thought was most important in dealing with infrastructure is the scale at which things should be done and the apparent advances that have made by each of the ministries in organization to implement these plans," Wolfensohn said. "So, the bank has assured each of the ministries about the support. We look forward very much to working with water, highways and power," he said.

The Business Standard (India) adds that in a series of presentations made to Wolfensohn, India's infrastructure-related ministries identified areas like the Pradhan Mantri Gram Sadak Yojana, state highways, railway modernization, remote area connectivity, rural electrification and rural drinking water supply for assistance. "We will work with the government on their sense of direction. Today, in the Planning Commission we looked at four areas of importance to the government: water, power, roads and railways. But we will continue our presence in healthcare, education and AIDS control," said Wolfensohn at a press conference. "The finance minister is anxious that the issue of water is addressed. But there is no single area of focus. The country needs to move along on many fronts," he added. Asia Pulse adds that while the World Bank did not have any doctrine on the issue of offering free power and water to agriculture, Wolfensohn said "of course poor people need help. But, somebody has to pay for it (free power) and it has to be sustainable." The World Bank President denied allegations that the World Bank imposes "riders" for granting loans, saying "the bank has never held meetings with head of states in this regard." Some countries welcome riders as they could later blame the bank in case project implementation runs into problem. As far as India is concerned, most of the decisions are made in the World Bank office in the country itself.

Finally, The Press Trust of India notes in another piece that Wolfensohn expressed concern over the difference in the pace of growth in rural and urban areas, and said it was important to address problems of rural India where 70 percent of people live, improve rural sanitation and electrification. He also expressed concern over the growing incidence of HIV/AIDS and said in the last 10 years 4-5 million cases have been detected and it was growing exponentially. Wolfensohn welcomed the outward economic policies of India saying it has signed free trade agreements with countries like Thailand and the ASEAN. On the charges that donor countries dictated the terms and amount of loans given by World Bank, he said "there had been no problems... In fact, we have more fights with G8 countries." He said the decision are taken by a professional management in the bank and there was no major influence of developed nations in this regard. Wolfensohn assured that developing countries would have "greater voice" in the coming years.

noticias.info (press release), Spain, 22 November 2004

Transparency International Rethinking Its Corruption-measuring Method Amid Backlash

Donors urged to boost bailout package for low-income countriesIn the face of objections from different countries, Transparency International is rethinking its corruption-measuring method used for preparing corruption-perception index that showed Bangladesh as a most corrupt country for three consecutive years. Finance Minister Saifur Rahman Saturday apprised reporters of the TI rethink on his return home after consultation with the top-notch of the Berlin-based international watchdog body as to how they determine the level of corruption in a country. He said the TI authorities were bringing the changes in their guidelines in the wake of threats by some countries, including Ethiopia, to sue them.

Saifur, during his exchanges with TI chairman Peter Eigen, has made it a point that corruption starts from developed countries as their big corporate houses are doing commission business in the poor countries. "The abettor is equally responsible; both are corrupt. The home of corruption is your country," he has told the TI chief, explaining how corruption spreads in countries like Bangladesh. Saifur said they were also formulating new guidelines for multinational companies (MNCs) to assess their levels of corruption, as they are the abettors in the spread of corruption the world over.

The Transparency International chief apprised the minister of the recent developments when he visited the non-governmental organization headquarters during his weeklong tour of Germany. "They are rethinking some changes to the criteria they follow in preparing Corruption Perception Index (CPI)," Saifur told reporters at the Zia International Airport. TI's corruption index has branded Bangladesh as the top corrupt country for the third consecutive year. The Minister vented his discomfort to the TI bosses that the report tainted the country’s image abroad, prompting the donors to take back some US$ 300 million in assistance from the millennium-challenge account. Saifur explained Bangladesh's efforts to combat corruption as he apprised the TI chairman of the steps taken so far. He pointed out establishment of institutions like independent Anti-Corruption Commission, recent reforms in the financial sector to strengthen oversight function on the banking sector and the Fiscal Responsibility Act now being framed. He, however, explained to the TI president that the steps could not be implemented overnight.

Matamat.com, Bangladesh, 28 November 2004

Reforms: Senior Officials Tackle Federal Government

Senior government officials at the weekend warned the Federal Government over its on-going reform programmes, saying the masses should be made the centrepiece rather than alienating them with harsh fallouts. The officials, who spoke through the president of the Association of Senior Civil Servants of Nigeria, Comrade Olanrewaju Olaitan, also described as misguided the move by the Federal Government to downsize as part of the reforms. Olaitan told government that the rate at which Nigerians can absorb shocks arising from blanket implementation of some of the policy prescriptions cannot be compared with those of developed economies where the level of income and standard of living of citizens are already high. "The government should be mindful of the country's level of development when considering some of the choices before it. Government is strongly advised to listen to useful suggestions being put across by well meaning Nigerians towards relieving the people from the heavy burden placed on them by the reforms", he stated. Olaitan, while addressing a seminar organized by the Ministry of Defence for civil servants last Friday, added: "While we are not totally opposed to these policy reforms, we will nonetheless suggest that they should be made to wear a human face. This will go a long way in ensuring that Nigerians are not unnecessarily dislocated with heavy injuries sustainable therein."

On the proposed retrenchment exercise aimed at downsizing the civil service for efficiency, the association's president said: "It is no longer news that the federal government is seriously warming up to undertake a mass retrenchment of workers in the civil service. The latest onslaught is being planned under the misinformed belief that the civil service is one way or the other over-bloated. Our association has always made it clear to government that the federal civil service is in no way over-bloated." Emphasizing that the association believed that change is constant in human endeavour, he said: "We are however, concerned as to the ways such reforms are carried out. Our opinion is that a committee that should reform the civil service must be made up of seasoned and tested civil servants." "Any attempts to bring back into the civil service a replica of Decree 43 of 1988 which had a unique feature of professionalism but which made a mockery of the entire system and brought about low productivity and insecurity of tenure cannot be said to be a reform that is needed to re-engineer the civil service for greater efficiency."

AllAfrica.com, Africa, by Kingsley Omonobi of Vanguard, Lagos, 22 November 2004

Computer Literacy Made Compulsory for Civil Servants

Accra - All top officials of the Civil Service, including Chief Directors, Directors and Heads of Departments, should be computer literate by the end of this year, Dr Alex Glover-Quartey, Head of the Ghana Civil Service said on Monday. In addition, officers just below the top echelon must become computer literate by the middle of 2005, he said. "All these measures are aimed at incorporating Information Communication Technology (ICT) into public sector reform and performance," Dr Glover-Quartey said at the opening of a four-day E-governance workshop, jointly organized by the African Training and Research Centre in Administration of Development (CAFRAD) and the African Capacity Building Foundation (ACBF).

The workshop, which is under the theme, "Enhancing reforms and public service performance in Africa", is being attended by 60 participants from 37 countries, mostly African. It afforded the participants to share knowledge and experiences in e-governance as a way of strengthening the capacities and setting new strategies in the use of ICT for improved public service reforms and performance. Dr Glover-Quartey said as part of measures to effectively incorporate ICT into the public sector reforms and performance, a Civil Service Computer Training Centre had been established to train ICT personnel for the service. He said Ghana was a proud host of the four-day workshop, as it presented a great opportunity for those in charge of the various sector-specific ICT policies to improve their understanding on how to apply ICT to improve the performance and service delivery of the GCS. In a speech read on his behalf by the Minister of Energy, Dr Paa Kwesi Nduom, President John Agyekum Kufuor noted that Ghana had instituted several measures towards public sector reforms.

"Government, however, recognizes that for these reform initiatives to be successful and effective, ICT should bear a key role." He noted that the link between e-governance and the economic development of the country, could not be over- emphasized, saying that, Ghana had taken steps to promote e-governance by launching the ICT 4AD Policy. The policy, he said, was the statement for the realization of the vision to transform Ghana into an information-rich, knowledge-based society and economy through the development and deployment of ICT in the society. "One of the objectives of the policy is to reform the civil and public service to improve on their organizational systems, structures, procedures and processes. "Government is acutely aware of the link between efficient and effective civil and public services and the pace of economic and social development." President Kufuor urged participants to take the ICT and good governance policy initiatives of the individual participating countries as well as those being taken by the Committee of African Ministers for Pan-African Programme in Governance and Public Administration into consideration to ensure that the outcome of the workshop was comprehensive.

GhanaWeb, Ghana, 22 December 2004

UNAMSIL Chief Says Civil Servants Salary is a Recipe for Corruption

UNAMSIL's Deputy Special Representative of the Secretary General Ambassador Victor Angelo charged that the salaries and wages paid to civil servants is a receipt corruption. Angelo who doubles as UNDP resident representative said at a press briefing at Unamsil headquarters that the government should increase the salaries of workers so they would not engage in corrupt practices. "I foresee no threat to destabilize the peace and security of Sierra Leone", Ambassador Angelo added that after his arrival in the country he has held series of discussions with officials of this Anti Corruption Commission (ACC) and Mines Ministry officials. He noted that there would be no development with out the full participation of the private sector. Angelo maintained that no country can depend on donor funding forever because the funds are for a given period of time. "Every country, he went on, has to build its own capacity", he stated. Adding, "Unamsil is exploring all the options that are available here".

AllAfrica.com, Africa, by Abdul Karim Koroma of Concord Times, Freetown, 23 November 2004

Sri Lanka Gives Pay Hike to Civil Servants

Sri Lanka's government unveiled a proposed annual budget Thursday with higher tax rates and pay raises of up to 40 percent for its 500,000 civil servants. The measures were aimed at both narrowing the country's budget deficit and fulfilling an election pledge to raise the civil servants' salaries, Finance Minister Sarath Amunugama said. Parliament must vote on the budget in late December, and is expected to approve it because the ruling coalition has a majority of seats. The government has widened the tax net to help cut the deficit to 7.5 percent of gross domestic product next year, from an estimated 8 percent this year. Although the civil servants are to receive raises, they will also have to pay income taxes for the first time.

The proposed budget would leave a deficit of 171 billion rupees (US$1.6 billion, euro1.3 billion), with revenue of 389 billion rupees (US$3.7 billion, euro2.8 billion) and expenditures of 560 billion rupees (US$5.3 billion, euro4.1 billion). The government projected defense spending for 2005 at 56 billion rupees (US$533 million, euro409 million), an increase of nearly 8 percent over the current year. Peace talks with Tamil Tiger rebels that began in 2002 on ending an ethnic war that has killed 65,000 people were suspended in April 2003. President Chandrika Kumaratunga needs extra revenue to meet her election pledges to control inflation and raise civil servants' salaries. Sri Lanka's government imposed taxes of 10 percent to 20 percent on all nonessential imports in November in response to rising global oil product prices and the Sri Lankan rupee's weakening against the U.S. dollar. The rupee has slipped about 8.5 percent against the American currency so far this year. In his speech to Parliament, Amunugama also asked Sri Lankans to buy local goods to save foreign exchange and encouraged vehicle owners to use public transport to save oil. "So my plea to the nation is to be more mindful and responsible in your consumption habits. I rather prefer we modify our consumption habits voluntarily than it be mandated by law," Amunugama said.

Forbes, New York, 18 November 2004

Failed Strike by Civil Servants Takes Toll on Labor Groups

The "winter struggle" by labor groups for more labor rights is entering a new phase after a general strike by the Korean Government Employees’ Union (KGEU) ended in failure amid worsening public sentiment toward the unionists. The KGEU said Thursday hundreds of its members who took part in the illegal walkout demanding the right to strike were going back to work, while the government is vowing to take harsh disciplinary action, including dismissals, against the KGEU members. The failure of the first-ever strike by the KGEU has cast a dark cloud over a planned general strike by the Korean Confederation of Trade Unions (KCTU), the larger and more militant of the two umbrella labor unions. The KCTU strike, scheduled for Nov. 26 in Seoul and other major cities around the country, has a symbolic meaning for labor groups in their struggle for more labor rights, but the government says it will not have negotiations with the labor union or make any form of compromise. The Ministry of Labor has said the KCTU strike will be dealt with as sternly as that of the KGEU was. The KCTU said the upcoming strike will be a cornerstone in its fight for a fairer and more labor-friendly society, but the circumstances appear to be against the group.

A total of 2,488 government employees are facing dismissal for participating in the strike, which was backed by the KCTU. In addition, the union leadership is on the verge of collapse as the tactics they adopted in the face of government crackdowns have resulted in sharp divisions among its members, casting a gloomy shadow over the future of the civil servants’ union. The embarrassing end to the strike by unionized civil servants has made the future difficult for the KCTU, which enjoys a membership of some 600,000 company workers. KCTU officials have said they will hold emergency meetings with leaders of district chapters and member unions, but much needs to be done to overcome challenges ahead of the strike next Friday. "What matters at this moment is how to rebuild public confidence and pool the wisdom and strength of labor groups," KCTU leader Lee Soo-ho said in an interview with Seoul Shinmun on Tuesday. "We will seek a strong alliance with the Federation of Korean Trade Unions (FKTU) to make our plans succeed. If the government continues to ignore our demands for negotiations, angry workers will not just sit idle. It will have to pay the price."

The bone of contention between the KCTU and the government is the four labor bills to be submitted to the National Assembly. One of the bills is aimed at enhancing labor market flexibility, giving company owners more leeway in hiring irregular and temporary workers. The KCTU has claimed the bill, if enacted, would jeopardize the status of irregular workers and part-timers and worsen overall working conditions for ordinary company workers as well. The umbrella labor union also backs the civil servant union in its move to secure the right to strike, which one of the bills seeks to ban. During the strike, it will also demand the government stop negotiations for the free trade agreement with Japan and withdraw Korean soldiers from Iraq. The government believes the union is going too far. Labor Minister Kim Dae-hwan said the union is attempting to take advantage of the strike to nullify key projects on the national agenda, which have been pushed ambitiously by the current government.

"Many of us believe the KCTU is trying to intervene in politics and take issue with government plans in their strikes," Kim said. "A closer look at the labor bill will reveal how we tried to reflect their demands for better labor conditions. But they don't try to look on the positive side." Union leaders believe they will emerge triumphant in the end. Citing a struggle by a teachers' union in the 1990s, union leaders said that although the government may fire public workers who participated in the strike last week, all of them would be reinstated when things have changed. "Whatever action the government may take against the KGEU, our goal remains the same. Politicians will have no choice but to accept the union as a negotiating partner and ensure the right to strike," KCTU spokesman Lee Soo-bong said. In 1989, the Roh Tae-woo government fired some 2,000 teachers who sought to form a teachers’ union, but all were reinstated in 1999 under the rule of Kim Dae-jung after the National Assembly decided to legalize the union.

Korea Times, South Korea, by Na Jeong-ju, 18 November 2004

No More Individual Ranks for Grade 1-3 Public Servants

Starting in 2006, a "Senior Civil Service" composed of some 1,500 civil servants of grades 3 or higher, including secretary-generals and director-generals of central government agencies, will be inaugurated. Civil servants who are included in the Senior Civil Service will no longer have individual ranks, and even officials in the same job class will receive differentiated remuneration according to assigned work and results produced. The Civil Service Commission (CSC) released a government bill outlining the above on November 18. A hearing on the issue will take place on November 19, after which the CSC will cull opinions from various sectors and announce a finalized bill during the first half of 2005. According to the bill, public servants in the upper 1,280 posts - comprising general civil servants such as director-generals and secretary-generals, certain special positions including members of the Foreign Service, and those in excepted or contracted service - will be appointed from among the constituents of the Senior Civil Service from 2006 onward. As for appointments in each government agency, 20 percent will be made from outside civilian personnel, 30 percent through internal job postings, and 50 percent at the agency head's personal discretion. The ratio of appointments will be finalized through the hearing and other pertinent processes.

The CSC stated, "Civil servants in the relevant 1,280 positions will all be enlisted in the Senior Civil Service in 2006," and added, “If we include officials of grade 3 or above who are currently in training or on external assignments, we expect to have about 1,500 members altogether in the Senior Civil Service.” The bill also states that, after the launching of the Senior Civil Service in 2006, department chiefs and civilians who wish to join the Service must pass an eligibility evaluation and a job posting process. Even those already in the Service will go through appointment screenings every four or five years. Members of the Senior Civil Service will be subject to a substantially strengthened achievement management system. Each civil servant will sign a contract based on on-the-job achievement with the head of his or her agency, and the results of achievement evaluations will be reflected in personnel decisions. The CSC revealed that it is considering plans to "terminate public servants who receive the lowest evaluation grade on two or three consecutive occasions or those who have not received an assignment for a total of two years." At the same time, salaries will differ according to the importance, difficulty, and achievement level of each assignment, so that even officials with identical titles such as assistant deputy ministers or director-generals of planning & management will receive differentiated pay depending on the agency or division in which they are appointed. A portion of the special service such as the police, the public prosecutor's office, the education system, and the fire department, as well as officials in local governments and in constitutional agencies besides the administration, have been excluded from the Senior Civil Service. However, those in special posts who wish to join the Senior Civil Service will be allowed to apply for membership.

Donga, South Korea, by Huyn-Doo Lee, 18 November, 2004

Public Service Strengthens Further

The government is delivering on its commitment to deliver strong public services, with a new survey showing public service staff numbers up by six per cent this year, State Services Minister Trevor Mallard said today. Trevor Mallard today released the results of the State Services Commission's latest survey on employment in the public service. The Human Resource Capability Survey 2004 collected and analysed anonymous data on all staff in the 35 public service departments as at 30 June 2004. "These results show the Labour-led government is continuing to deliver on its commitment to ensure New Zealanders are well served by a strong and stable public service. "The survey results show the number of permanent staff in the public service has continued to increase. In the year to 30 June 2004, the growth in permanent staff was just over 1,890 employees, or 6 per cent, once changes affecting the scope of the survey were taken into account. "Many of the reported increases in staff numbers were in frontline occupations that directly serve or interact with the public, such as social workers, prison officers and call centre staff. "The growth was spread across the public service, with 31 departments reporting an increase in the number of permanent staff. The public service of 2004 is still slightly smaller than the public service of ten years earlier. "Despite the growth in numbers, the public service only makes up around 2.3 per cent of all New Zealand jobs, compared with 2.2 per cent last year."

Trevor Mallard said the public service continues to provide a stable working environment with turnover rates remaining fairly constant for the past five years (12 per cent in 2004) and the number of staff on current collective agreements increasing over the past year. "In addition, the number of employees who received redundancy payments during 2003/2004 was at the lowest level since data was first collected on this in 1991." The pay gap between salary levels paid in the public service and those paid in the labour market as a whole has closed noticeably over the past year, although the public service still tends to pay less, particularly for more senior positions. Trevor Mallard said the new State Sector Retirement Savings Scheme (SSRSS) had made an important contribution to the long-term security of public servants. About 45 per cent of eligible employees joined the new scheme, taking the total number of public servants who are members of an employment-based superannuation scheme to 51 per cent, compared with 14 per cent before the scheme was introduced. "A high performing public service is important to New Zealand's success as a society. I am pleased that this survey shows New Zealand is well served by a stable and strong public service - that is able to rely on its own expertise and less on outside consultants," Trevor Mallard said.

Questions and Answers

What is the Human Resource Capability Survey? The survey is carried out each year by the State Services Commission. It gathers anonymous unit record data on all staff in Public Service departments. The survey includes a wide range of information relevant to Human Resource (HR) management and Equal Employment Opportunities (EEO). How long has the data been collected? The unit-record survey has been carried out since 2000. However aggregate survey information, showing overall employment levels in Public Service departments, has been gathered for many years. How many people are employed in the public service? As at 30 June 2004, there were 37,865 employees (35,645 full-time equivalents) in the Public Service. The Public Service of 2004 was slightly smaller than the Public Service of ten years earlier in 1994. How many people make up the state sector? The public service makes up a small proportion of total state sector employment, as measured by Statistics NZ. In 2004 the Public Service made up only 14 per cent of the 275,000 state sector jobs.

The state sector includes all organisations owned by the government, including schools, hospitals, public service departments, and state-owned enterprises. How much of the increase involves frontline positions? Around 38 per cent of the increase in permanent staff was in frontline positions, including jobs such as social workers (the number of whom increased by 10 per cent), call centre operators (9 per cent), prison officers (6 per cent) and customs officers (25 per cent). Where can I find previous reports? http://www.ssc.govt.nz

Scoop.co.nz (press release), New Zealand, 15 November 2004

Civil Service Pay Cuts Broke Basic Law, Rules Appeal Court

The government suffered a surprise legal reversal on Monday when the Court of Appeal ruled it had violated the Basic Law in reducing civil servants' pay, a judgment that may ultimately cost it HK$3 billion in wages deducted from workers' pay cheques. Officials said an appeal would be filed against the judgment. The ruling put additional civil service pay cuts in question and also raised fears that the government may decide to take the contentious issue to the National People's Congress (NPC) Standing Committee should it lose in the next round. The pay cuts, which took effect on October 1, 2002, were ruled unconstitutional in a 2-1 decision. Justice Anthony Rogers and Justice Doreen Le Pichon said the two civil servants involved in the case did not have to accept the reductions imposed by the government. If ultimately upheld, the ruling would be a big victory for 170,000 civil servants, whose pay was reduced in reaction to the economic downturn of recent years.

In reacting to the judgment, Secretary for Civil Service Joseph Wong, however, said the government would now take the case to the Court of Final Appeal. "We have studied the Court of Appeal judgment carefully and we have decided to appeal to the Court of Final Appeal and seek an early hearing in view of the considerable public importance of the case," he said. Wong did not say whether the government would ask the NPC Standing Committee to interpret the Basic Law provision in question should it lose in the SAR's highest court. The NPC Standing Committee is, in effect, Hong Kong's highest court and has the authority to reverse judicial rulings on Basic Law matters, as it did in a landmark 1999 right-of-abode case brought to the NPC by the government after losing a decision locally. Democrat legislator Cheung Man-kwong worries that the government will seek NPC intervention in the issue. "Then, there would be question on whether the ruling of the Standing Committee is solely based on legal points of view, or whether the decision is politically motivated in favour of the SAR government," he said. The two civil servants involved in the case challenged legislation passed in 2002, at the height of the economic crisis, which cut staff pay.

The legislation, the plaintiffs argued, contradicted Article 100 of the Basic Law that provides civil servants retain the same pay, allowances, benefits, and conditions of service in place at the time of the handover in 1997." said Bernard Lau, one of the applicants. "I don't think there is any loser in this case. The SAR government has not lost for it has won back the trust of its civil servants. The general public also have not lost, as Hong Kong has an independent and unbiased legal system." Civil service unions also welcomed the ruling. Police Inspectors' Association chairman Tony Liu, who is helping Lau, said civil servants were vindicated by the judgment. "A lot of people in the community say we are wrong in putting the issue to the court and asking the government not to impose pay cuts.

The ruling proves we are legitimate," he said. Liu believes the government should pay back about HK$3 billion in deducted salaries to civil servants. Federation of Civil Service Unions chairman Leung Chau-ting urged the Court of Final Appeal not to hear the case, fearing that an appeal to the highest court would lead to endless lawsuits over the pay issue. Senior Non-Expatriate Officers' Association vice-chairman Philip Kwok said the government should immediately review all measures imposed in recent years affecting civil service pay. The 2002 cuts, ranging from 1.58 per cent to 4.42 per cent, were compounded by a 3 per cent cut in civil servants' pay on January 1 this year. A further 3 per cent reduction is also due next January. The January pay cuts were passed last December. Civil servants have also applied for a judicial review against that decision.

The Standard, Hong Kong, by Teddy Ng, 29 December 2004

Strategic Plan For Better Civil Service In The Sultanate

Bandar Seri Begawan - The Prime Minister's Office yesterday launched a Strategic Plan for a more focused and a better professional system of civil service that will be in line with the current trends and the needs of the people. Officiating at the launch of the Strategic Plan for 2005-2014 was the guest of honour, the Permanent Secretary at the Prime Minister's Office, Pehin Dato Paduka Awang Haji Hazair. This is considered the first formal strategic plan that has been launched with ministerial level focus. Speaking at the opening ceremony, Pehin Dato Paduka Awang Haji Hazair said that the Strategic Planning is a management tool that can be used to help an organisation in improving its work. It is a disciplined effort in helping to produce important decisions and management actions that can help decide the directions of an organisation over things that must be implemented, the reasons on why they are being implemented and ultimately decides on the future of that organisation, the Permanent Secretary noted. This effort is in line with a Titah during His Majesty's 57' Birthday for all ministries to develop their respective strategic plans so as to align their missions and goals with national aspirations and development policies.

The Permanent Secretary also touched on the role of the PMO in providing strategic plans to uphold and realise the vision of the PMO for excellent leadership and good governance for the good of national stability and prosperity. Its mission is to increase the effectiveness of executive decision-making by the government of His Majesty in pursuit of excellent leaders and governance for national security and sustainable development and to uphold the philosophy of the Malay Islamic Monarchy (MIB). Achieving such a vision, mission as well as objectives needs commitment and concerted steps by each agency besides implementing cooperation, coordination and assistance for the appropriate bodies in realising what is desired by the government of His Majesty the Sultan and Yang Di-Pertuan of Brunei Darussalam, the guest of honour added. The PMO Strategic Plan is the first step for a long journey since it is a continuing process from its implementation or monitoring. Pehin Dato Paduka Awang Haji Hazair further said that its implementation needs modification or changes to adapt to the current development and dynamic environment.

Meanwhile in a welcoming speech, Awang Haji Mohd Mahdi, Senior Administrative Officer and also the chairman of the ceremony, touched on the challenges in preparing the strategic planning especially in gathering the members of the strategic planning team, determining its vision, mission, roles and the main PMO strategic issues since it is the central agency for ministries and departments under it. He hoped that with the strategic planning, it would assist the PMO and other departments under it to provide an effective, efficient and outstanding service to other government agencies, private sectors and most importantly for the public. The launching of the PMO Strategic Planning also saw a video presentation that explains the direction, mission, vision and the seven themes of the plan. Pehin Dato Paduka Awang Haji Hazair also presented the books detailing the PMO Strategic Planning to heads of departments under the PMO. Certificates of appreciation were also presented by the Advisor of the PMO Strategic Planning Team, Pg Dato Paduka Haji Abdul Hamid to members of the group. Present at the ceremony that took place in Jerudong were Permanent Secretaries at the PMO, Permanent Secretaries of other Government Ministries, heads of departments under the PMO, senior officers and officers at the PMO and departments under it. - Courtesy of Borneo Bulletin.

Bru Direct, Brunei, Darussalam, by M.K. Anwar, 25 November 2004

Ministers Unveil Draft Civil Service Bill

TThe government has published its long-awaited draft civil service legislation. The draft bill, which is now subject to three months consultation, rejects calls for an upper limit on the number of special advisers. Instead it says the legislation should "clarify" their role in Whitehall. Ministers say their central target is to ensure that the "politically impartial civil service is sustained". But the government also warns that the legislation must not inhibit the civil service's "continuing evolution, development and reform".

No cap
In a sign that the recommendations from the committee on standards in public life have been watered down, the government rejects a cap on the number of special advisers. "Of course,the government must account for the special advisers appointed by ministers," says the consultation document. "The bill's approach is to require transparency and it provides for the minister for the civil service to make annual reports to parliament giving their names, responsibilities, activities and cost." The legislation also rules out a fundamental restructuring of the civil service.

Ministerial accountability
It says that civil servants' accountability "will continue to be to their ministers who, in their turn, are accountable to parliament for their stewardship of the civil service and their custodianship of its values". The government goes on to say that the civil service should "command cross-party support by ensuring that it is capable of serving with equal dedication and commitment future duly elected and constituted governments, whatever their political complexion". The bill, which will also apply to those working at GCHQ, should not be used as a way of halting Whitehall reform, the government says. "It should not make the civil service immune to change, but should provide a framework within which it can continue its 150-year evolution into the era of globalisation," says the bill.

Response
The union which represents senior civil service said the proposals contained some "flaws" but welcomed the general thrust of the bill. "The UK civil service has a worldwide reputation for the highest standards of integrity and professionalism," said FDA chief Jonathan Baume. "The values and governance of the civil service were first established 150 years ago in response to widespread political cronyism and corruption. "During a period of tremendous change within the civil service, we believe that a civil service act is vitality important to help preserve those values and high standards of behaviour." "This draft has flaws. For the past two years, the Cabinet Office has sought to increase political involvement in civil service appointments and minimize the importance of the civil service code, and the bill has been drafted in this spirit. "However, we will be considering the draft in detail and responding to the government. Our priority will be to secure a cross party consensus - we do not wish a civil service act to be the subject of party political controversy." The Conservatives said the draft legislation failed to address the problem of special advisers being given authority over civil servants. "Labour are all talk on civil service reform. The real test of any bill is whether it will protect the impartiality of the civil service from political interference. This bill does not," said Oliver Heald. "One of the first things this government did in 1997 was to pass an order allowing unelected Special Advisers power over career civil servants – this still remains the case. "A government that is serious about civil service impartiality would immediately revoke this order. "This is what a Conservative government would do on day one of taking power."

ePolitix, UK, 15 November 2004

Bill to Ban Civil Service 'Spin'

Plans for a new law guaranteeing the political impartiality of the Civil Service will finally be unveiled this week. The draft Civil Service Bill - aimed at killing off the culture of "spin" - will make it an offence for a minister or their special adviser to politically direct a civil servant. However, some observers think Tony Blair's reluctance over the issue means that it will never become law. The Prime Minister promised a draft bill in the Queen's Speech almost exactly a year ago, but has made no secret that it is not a government priority. It is thought that Mr Blair was only forced to bring the issue forward because the Hutton Inquiry made clear how civil servants were kept out of the loop on many decisions.

This is London, UK, by Paul Waugh of Evening Standard, 15 November 2004

Law Waived for Civil Service Posts

The merit principle was dropped twice last year for senior appointments to the Civil Service, according to a new report.
The Civil Service Commissioners, who oversee employment practices in the Civil Service, say in their annual report that they twice agreed to waive the law requiring the appointment of the best qualified candidate for top posts. Both the exceptions for senior posts were granted on the basis that "the appointment is justified for exceptional reasons relating to the needs of the Civil Service". Those grounds for waiving the merit principle were used once in the other 136 cases involving lower level appointments. The Commissioners gave no details of the two appointments in their report, but outlined two cases where they refused to waive the merit principle for senior appointments. In those cases, they refused to allow a department to hire 38 retired civil servants to work on internal promotion boards. They also turned down a request to reinstate a senior civil servant who resigned but asked to come back to their job three months later.

Overall, the merit principle was dropped 138 times during the 2003-4 financial year. The law requiring the Government to appoint the best qualified candidate after fair and open competition was waived mostly for the "encouragement and assistance" of the disabled. There are eight grounds for exceptions to the merit principle in appointments to the Civil Service. They include special arrangements for disabled people and circumstances where the candidate is being "re-employed" after leaving the Civil Service. The principle was waived 86 times for "assistance to the disabled" in 2003-4.

Belfast Telegraph (subscription), UK, by Chris Thornton, 19 November 2004

Civil Servants in Deal to Avoid Job Losses

Alan Johnson, the work and pensions secretary, unveiled a "stay of execution" agreement with the Whitehall civil service union yesterday to try to avoid compulsory redundancies, after 200,000 members went out on strike earlier this month. The deal means no compulsory redundancies for three months. But it applies only to the 30,000 jobs at risk within Mr Johnson's department and not to the eventual cut of 100,000 jobs across the civil service which the chancellor, Gordon Brown, has proposed. Nor does it remove the threat of redundancies or of renewed industrial action by members of the Public and Commercial Services Union (PCS), whose action shut benefit offices, driving test centres and museums on November 5.

After talks with Mr Johnson and Brendan Barber, the head of the TUC, Mark Serwotka, general secretary of the PCS, warned that services might still be "decimated" but said his union had won "significant concessions". Whitehall officials said that Mr Johnson, a former union leader, had "rolled his sleeves up" to sort out a step-by-step process to reconcile conflicting interests. With the shadow chancellor, Oliver Letwin, taunting Mr Brown about rising staff numbers in Whitehall - despite his promised cuts - Mr Johnson regards his agreement as a beacon for other departments. However, Mr Serwotka said the fear is that for many the agreement will merely be a "stay of execution".

Guardian, UK, Michael White, 19 November 2004

Fears for Civil Service Jobs as £1.73bn Scots Government Cuts Revealed

The cost of running the Scottish government is to be cut by nearly three times as much as ministers had previously claimed, raising fears that hundreds of civil service jobs could be axed. Tom McCabe, the finance minister, will today announce savings of more than £1.73 billion over the next three years. Previously, ministers had said they would cut only £650 million by 2007. Last night, Mr McCabe said his proposals would establish Scotland as a "beacon" of efficient administration. However, the scale of the savings to be made will undoubtedly lead to concerns over job losses.

Professor Arthur Midwinter, a leading financial expert and adviser to the Scottish Parliament’s finance committee, has also questioned Scottish Executive claims that their savings are "tougher" than those made in England. The row over how "tough" the savings were erupted earlier this year when Jack McConnell, the First Minister, claimed the Executive would deliver cost cuts of two per cent every year, equivalent to £500 million annually. Mr McConnell insisted he was going further than the 1.25 per cent of savings from public-sector budgets drawn up by Sir Peter Gershon, which the Chancellor said he would implement for the rest of the UK. However, Prof Midwinter questioned the claims. "The Executive has not yet produced any convincing numbers to show that they are tougher than England or a convincing explanation as to why they think their figures are tougher," he said.

The Scotsman, UK, by Andrew Denholm, 28 November 2004

Thousands of Civil Service Jobs to Go

Thousands of civil service jobs are to be axed in a drive to make Scotland's government more efficient. And council jobs in Glasgow and across the west of Scotland will also go as local authorities have their budgets slashed. There are fears the total job losses could top 10,000. Finance and Public Services Minister Tom McCabe today said he would slash the cost of government in Scotland by at least £1.73billion between now and 2007. Local authorities will take the biggest hit, with a total aggregate saving of £502million in the finance and public services budget. Glasgow was praised for achieving efficiency savings of £80m in the past four years - but more cuts will have to follow. Next on Mr McCabe's 'hit list' is health, which is expected to save £498m, while Scottish Water has been told to save £255m.

The minister admitted his plans would lead to job losses and confirmed he expected to see a smaller public sector - but he declined to put a figure on the job losses. He said: "There will be no arbitrary up-front job cuts but there will be fewer people employed who are not delivering frontline services." Mr McCabe's plans are almost three times the target of £650m set by his predecessor Andy Kerr earlier this year in response to sweeping cuts in government bureaucracy announced by Chancellor Gordon Brown. Mr Brown's announcement in July that 104,000 civil service jobs were to be axed sparked widespread protests, and earlier this month 30,000 Scottish civil servants held a one-day strike. In September, it was announced that 200 workers at the Coatbridge JobCentre and Hamilton Social Security Office in Lanarkshire would lose their jobs, along with 100 civil servants at a call centre in Provan, Glasgow. And union leaders have warned up to 4000 jobs would be lost in Scotland at the Department of Works and Pensions.

Mr McCabe also said savings would be made by around 125 public sector organisations using centralised procurement, with public sector organisations merging shared support - such as payroll, human resources and finance. Mr McCabe also pledged to target the "sicknote culture" in the civil service and public sector. He said all public sector organisations needed to have effective strategies for managing sickness absence, including "firm measures" to tackle abuse of the system and work-related causes of ill-health. The public spending watchdog Audit Scotland is already undertaking an analysis of sickness patterns. Mr McCabe said he was determined to "attack waste, bureaucracy and duplication" in the public sector and establish Scotland as a benchmark for efficiency and productivity in public services. The savings are expected to be made by merging administrative departments and cutting red tape, with the cash then being ploughed into improving schools, hospitals and transport. He said: "This is not a cuts agenda, it's about efficiency. It's not about taking money from departments, it's about them using it more efficiently." He said local government organisation Cosla was aware of the targets and talks would take place with trade unions.

The plans are outlined in what the Executive is calling a "radical agenda" for efficient government. In September, Jack McConnell said the review would be even tougher than one written by Sir Peter Gershon for the Chancellor on the English public sector, under which 70,000 jobs are to go in UK government departments. Today Mr McCabe said: "As a result of work since June, we now have plans which will deliver at least £1.732bn of cash savings over the three years of the Spending Review to 2007-08. "This will be released for investment in improving our public services in year-on-year savings to release resources that will be moved to the people and places that matter. "We are committed to excellent public services, designed and delivered to make sure that the interests of those who use them come first. Reform and modernisation are central to realising this ambition."

Glasgow Evening Times, UK, 29 November 2004

Irish Civil Servants Set for Dublin Exodus

Dublin (Reuters) - Thousands of Dublin-based civil servants will decamp to provincial towns and cities in the next few years as the Irish government seeks to redistribute some of the wealth and population accumulated in the capital. Ireland eventually wants to see around 10,000 state employees move out of Dublin under plans announced last year. On Wednesday it said some 3,500 jobs would initially be spread across the country as eight government departments moved their headquarters to towns from Knock to Killarney. Defence, agriculture and tourism will be among the first ministries to have their main operations relocated to the regions. A further 20 government branches have been given priority status for moves to other parts of the country. Construction work is due to begin at many sites by late next year with some completions scheduled as early as 2006. "The government is fully committed to delivering the whole programme as announced by (former Finance Minister) Charlie McCreevy," Tom Parlon, Minister of State at the Department of Finance, told state broadcaster RTE.

Moving the government posts out of Dublin, currently home to about a quarter of the country's 4 million people and the main beneficiary of Ireland's Celtic Tiger economic boom, was one of the key elements of last year's budget. Opposition parties said Wednesday's announcement did not go far enough, quickly enough, but Parlon said this was just the "first carriage on the train." While the cost of building new offices will initially exceed any proceeds from the sale of property in Dublin, the government hopes to save money in the long run, although it does not expect to reap the rewards of its investment much before 2026. The scheme, which the government says is entirely voluntary, follows earlier much smaller schemes which saw the Central Statistics Office move to Cork and Ireland's largest tax collection agency move to Limerick.

Reuters, UK, 24 November 2004

World Bank Gives Iraq $7 mln Civil Service Grant

Washington - The World Bank on Tuesday announced a $7 million grant to train Iraqi senior civil servants in economic planning and public sector management. The two-year program will train hundreds of Iraqi government officials to manage economic transition, social development and poverty reduction, the bank said. "Iraq possesses a strong cadre of well-educated civil servants ... who will be instrumental in the government's ability to take on the urgent task of reconstruction and to efficiently manage resources," Joseph Saba, the World Bank's country director for Iraq, said in a statement. Saba said the program would help enable Iraqis "to develop their own solutions and strategies and implement policies central to the success of their development priorities." The agreement for the $7 million grant was signed with Iraq's Ministry of Planning and Development Cooperation. It follows a separate training program, worth 3 million euro ($3.4 million), that was launched in February focusing on procurement skills and managing internationally-financed development projects.

A World Bank spokeswoman said the new program was meant to build upon the initial round of training, which had involved about 600 Iraqis and took place mostly outside Iraq. The new training would take place inside Iraq "where possible," depending on security considerations, and otherwise would be held in other World Bank centers in the region such as Jordan and Egypt, the spokeswoman said. The World Bank withdrew its staff from Iraq last year after the bombing of the United Nations' headquarters in Baghdad. It has since done work on Iraq from an office in Jordan, holding teleconferences with Iraqi officials in Baghdad. While some U.S. lawmakers have criticized the bank for pulling out of Iraq, World Bank President James Wolfensohn has said his staff would not return to the country until the security situation improves. News from Iraq in recent months has featured suicide bombings, kidnappings and executions of foreign contractors, and U.S.-led raids on areas it says are held by Iraqi insurgents, such as Falluja. To date, international donors have deposited $370 million in the World Bank's Iraq Trust Fund, meant to finance emergency projects and technical assistance for the country.

Reuters, New York, by Laura MacInnis, 9 November 2004

Akwa Ibom to Computerise Entire Civil Service

Governor Victor Attah of Akwa Ibom State has stated the intention of his administration to expand computerization services to the entire civil service in the state. He stated this today at the commissioning of the computerization project and networking of key service departments in the state civil service in Uyo. Governor Attah disclosed that his administration decided to embark on the computerization and networking of key service departments and offices in the state in order to upgrade the quality of service as well as increase the productivity of civil servants in the state. He stated that the contract was awarded to 1B Benest Investment Ltd and Progenics in year 2001 to embark on the computerization and networking of key service departments and offices. He stated that in the first phase of the project, provision of hard ware in the offices with software application was developed and implemented in other areas like the Governors office and Human Resources management system for Bureau of Establishments and Budgetary control software for budget bureau. He urged civil servants to make good use of these facilities to attain outstanding levels of performance in their duties.

In his address presented at the opening, Umana O. Umana, the state's commissioner for finance disclosed that the contract was awarded in 2001 at the cost of N124,000.000.million. He stated that the project which is a total computerization and complete integration of systems to produce an automated environment that is functional. The project which ensures that each department and office is linked together in a wide area network provides each department with computers, printers, uninterruptible power supplies, stabilizers and laptops and internet access. The project he added will promote transparency, accountability, accuracy, accessibility to information and provide timely information by eliminating procrastination in Government.

AllAfrica.com, Africa, by Efem Nkanga of This Day, Lagos, Nigeria, 12 November 2004

Indian e-governance Faces Uphill Task: World Bank

Bangalore - A World Bank official said here Friday that India faced a challenge on scaling all the e-governance pilot projects that were at various stages of implementation. World Bank lead informatics specialist Robert Schware said at a seminar on e-governance, held as part of the IT.Com event, that only 110 of the 200 e-governance pilot projects underway were scalable. "India faces a real challenge in scaling all the pilot projects or even replicating half of them, which have been successful to an extent," Schware said. "The World Bank is in discussions with the Indian government on the extensive use of ICT (information and communications technology) to usher in e-governance at the administrative and transaction levels for improving the delivery system." Referring to the successful implementation of the Bhoomi project by the Karnataka government in computerising land records and their registration process, Schware said with the right resources and institutional capacity, such projects could be replicated in other states for bridging the digital divide. "Since the government alone can't do everything, the private sector has to be involved in a big way to prevent failures and speed up the processes for effective inter-face with people through e-governance," Schware told about 500 delegates participating in the seminar. "We consider India is at an experimental stage in using ICT applications for e-governance. Going forward, the public-private partnership will ensure greater transparency and effective use of technology in governance for low-cost and efficient delivery of services."

With a view to mapping common policy focus areas and interventions across countries, the World Bank is currently completing a study of national e-strategies in 40 countries. "Ironically, in most e-strategies that are prevalent, the e-government component refers to an e-government portal as the conduit for online services. "Such services often include land and property registration (G2C), e-procurement (G2B), centralised census and population data (G2G). "Our initial findings, however, reveal there is no e-government benchmarking to measure their benefits or success rate." In this context, the World Bank informatics specialist cautioned Indian state governments to beware of the high rate of failures witnessed in other countries in implementing e-governance projects. A recent World Bank study revealed around 35 percent of e-government projects in developing countries turned out to be a total failure, while 50 percent were partial failures and only 15 percent were successful. "There are, however, an equal number of very sad statistics about the number of failed implementation in the US and Europe as well with respect to e-governance projects," Schware claimed.

New Kerala, India, 5 November 2004

Spending on E-governance in India Rises Rapidly

Mumbai - With more state governments vying with one other to embrace IT to enhance efficiency and interface with citizens, the investment on e-governance projects has seen a steady rise in the past few years. Spending on e-governance has gone up by an impressive 25 percent annually from around Rs.15 billion in 2002 to an estimated Rs.22 billion this year, says a survey conducted by IT sector research firm Skoch Consultancy. Significantly, the survey revealed that e-governance had also helped in reducing corruption in areas like land records and customs clearances for exports and imports. "While the spending on e-governance is posting a 23 percent increase year-on-year, the overall figure is still very low and the number of sites still far and few," said the latest survey report made available to IANS. "Given the fact that these projects are delivering so well, there is a need to substantially hike this spending."

The survey report said it had been several years since the first e-governance project began in India and the number of such initiatives had increased rapidly since then. "E-governance projects in India are no longer just a fancy idea nor are they merely a source of big orders for hardware or software vendors. They are now an integral part of any serious governance effort," it said. "For all the concerns about a large illiterate population, which has hardly any familiarity with computers, the country appears to have taken to e-governance remarkably well." On the importance of e-governance in India, the Skoch report said on an average, the survey sample reported a score of 8.1 out of 10 for the decline in corruption as a result of 21 e-governance projects.

"What's heartening is that for various land record projects, where bribes are rampant, the scores on the decline in corruption after implementing e-governance projects were pretty good as well," said the consultancy firm. Uttaranchal's land records project scored seven out of 10 on the corruption parameter while Andhra Pradesh's e-governance project for land records scored eight. "Evidence suggests that even if elected governments don't work, e-governments certainly do. From a situation where railway tickets sold in the black, computerised reservation has meant this is not at all possible today," it said. "Similarly, while the customs department was known for both its corruption as well as delays, online filing and clearances have resulted in a situation where over 95 percent of all paperwork is now filed over the Internet. "The number of processing stages have been cut from 18 to six for paperwork for imports and from 15 to five in the case of exports."

The survey said there were several assessment schemes in various stages of planning or implementation for e-governance projects and to suggest strategies for scaling them up. "In a country that has large tracts without electricity, and even larger ones without regular electricity supplies, and pretty bad infrastructure like roads, what's especially encouraging is the quality of most e-governance projects."

New Kerala, India, 7 November 2004

E-government to Speed up Processes by 2010

HCM City - By 2010, the government may be handling many of its administrative services online, with a website for every state agency. The plan for the building of an "e-government" in Viet Nam, being devised by the Ministry of Post and Telematics (MPT), will use the internet as a platform to provide information to the public about all state agencies and to streamline currently cumbersome administrative procedures. Under the plan, to be submitted to the Prime Minister in December for approval, all government agencies are expected to have a website providing information and administrative services to the public through the Internet by 2010. The e-government calls for a national computerised administration system to help local residents and businesses that have been annoyed with time-consuming administrative procedures.

MPT deputy minister Mai Liem Truc said that one fourth of the country's urban residents are expected to own digital IDs while 40 per cent of domestic enterprises can make their business registration or corporate reports on the computer network. Truc, announcing the plan at a conference last week, also acknowledged that the country has a long way to go to realise its digital goals. In Viet Nam, Truc said, limitations in computer literacy, low per capita income and insufficient human resources in information technology (IT) remain the big hurdle for the e-government development.

Viet Nam is still ranked 60th in the list of 64 e-readiness countries, according to a report published by the Economist in April. Specialists in information technology said there is much to do to realise the scheme, given state agencies' limited computerisation and the low computer literacy among the population. Overhauling the cumbersome administration apparatus while promoting computerisation in all socio-economic sectors and civil transactions must be a precondition for building the country's e-government, the specialists said. The current number of Internet users and subscribers is still relatively small. Viet Nam had 1.54 million Internet subscribers and 5.49 million users by October, according to the Viet Nam Network Information Centre. The centre reports that 6.74 per cent of the country’s population regularly use the Internet and the number of domain names registered in Vietnamese is 8,217.

Viet Nam's Information and Communication Technologies (ICT) recorded a 29 per cent growth rate in 2003, ranking second after China with a turnover of US$515 million, but IT applications in the nation's economy remains meagre. Fifty per cent of ministries and industries and 10 per cent of domestic businesses have launched their own web sites but information is not updated. Computerised management is available in 50 per cent of domestic enterprises but only 30 per cent of businesses have Internet access and even these web sites are lacking transparent corporate information. The Ministry of Post and Telematics reported that 52 out of 64 provinces and cities nation-wide have their own web sites, but few of them have two-way interactive communication except those of HCM City, Dong Nai, Da Nang, Ha Noi and Bac Ninh. More than 300 of the 6,776 post offices in communes across the country have gone online.

"E-government is an inevitable trend to help promote democracy in any society," says Director of Post and Telecommunication Development Strategy Institute, Tran Minh Tien. It would prove efficient only if it targets the public's needs in the handling of civil procedures," he said. "Our proposed e-government should be built soon and must fully meet these demands since the time-consuming administrative procedures have annoyed the public," says director Tran Minh Tien, whose institute is finalising the e-government development strategy. To realise the project, Tien said, "we must work harder to build a good IT infrastructure and sufficient and qualified human resources for the industry while all administrative services must be tailored to be accessible via the internet." Besides building a standard administrative system, experts say, the government should promote IT education and application among State agencies, businesses, and the public use of computers.
Mai Liem Truc said the forming of an e-government is a must 'but the scheme should be carried out step by step, considering the country's actual conditions.' All administrative services, regulations and activities at all levels must be accessible to the public through the computer network, which is regarded as the primary condition to building an e-government, experts said. To help combat corruption in the system IT experts proposed that the State promptly issue regulations and sanctions necessary to ensure the supply of transparent and open information about State agencies, organisations and businesses’ activities on the network. - VNS

Viet Nam News, Vietnam, 13 November 2004

Australian E-gov Grows

Boca Raton, Florida - Australian e-government is all about the customers, a top official said today. In 1997, government officials in Australia decided to put their clout behind Centrelink, the country's version of e-government, to link citizens, deliver services and create the "Face of the Australian Government," said Jane Treadwell, chief information officer for Centrelink. Australia's e-government project is "unashamedly customer-centric," said Treadwell, speaking today to a gathering of the CIO Summit, sponsored by FCW Media Group. "We're silo-busters." Centrelink costs about $1.5 billion in U.S. dollars, financed primarily by 25 Australian agencies that are part of the project. Small fees are charged for some services, but the project is mostly publicly financed and free to customers. In addition, government officials regularly conduct as many as 2,500 focus groups.

One of Centrelink's top services provides Australians the ability to change their addresses in one stop rather than making them visit all the agencies they do business with. And it's a good thing, said Tom Hughes, CIO of the Social Security Administration. Australia, which has 20 million citizens and a vast territory, probably would have gone broke if officials had to provide separate offices for the equivalent of the Department of Veterans Affairs, Labor Department and SSA. "It's magnificent as a governmentwide policy," Hughes said. Treadwell is responsible for ensuring that the integrated development, transformation and support of Centrelink's services, products and underlying capabilities are in line with the business strategy. The program has become an international leader in e-government service delivery. She said government officials were intent on making it work within its own borders rather than outsourcing services to other countries. "We haven't and are not likely to go to India," Treadwell said.

FCW.com, bY Judi Hasson, 16 November 2004

ITU Holds e-Government and Internet Protocol Symposium in Dubai from 22 to 25 November 2004

The e-Government and Internet Protocol (IP) Symposium for the Arab States Region will address practical issues aimed at fostering the development of e-government in the region. It will also provide a forum for sharing experiences and discuss policy aspects of the management of Internet DNS (Domain Name System) and IP (Internet Protocol) addresses. The symposium is being organized by the International Telecommunication Union, in cooperation with the Emirates Telecommunications Corporation (Etisalat) and eCompany, a business unit of Etisalat. The symposium is intended for high-level representatives from Arab States Administrations, ITU industry members, experts in e-Government and Internet Protocol, representatives from multinational, regional and international organizations. The Symposium will provide inputs to the second phase of the World Summit on the Information Society (WSIS) to be held in Tunis, Tunisia, from 16 to 18 November 2005. Focused on concrete issues, this symposium will attempt to address the following topics:

e-Government: - Enhancing communication between government entities – How do government entities exchange information and what strategies are needed to create efficiencies and reduce the cost for communication within the government?

- Developing government information systems - What information and services do citizens want from their governments and how can the dissemination and provisioning of such information and services be facilitated?

- Transaction-based government services – What challenges must be addressed to build trust and confidence in critical (transaction-based) government services to citizens?

- Regional strategies for cooperation – How do we foster the elaboration of regional strategies and identify common challenges to be addressed in the region?

Internet Protocol: - Internet Protocol (IP) issues and the outcome of the World Summit on the Information Society; - Policy and migration strategies to optimize network services and applications; - DNS and IP address management strategies for policy-makers and regulators in Arab States; - A policy and strategy round-table.

ONU (Communiques de presse), New York, 17 December 2004

Forum via Internet to Follow E-government Programmes

Dubai - The Regional Arab Bureau of International Telecommunications Union (ITU ) will soon form a work group to create a forum via the Internet to establish communications and follow-up the e-government programmes in the Arab countries. The e-government is an essential instrument that Arab countries should approve in order to guarantee the right of Arab nationals to have access to communication facilities. It was a major consensus arrived by regional Arab Bureau of International Telecommunications Union, (ITU). The ITU had organised in collaboration with Etisalat (E-Company) a regional symposium on Electronic-Government and Internet Protocol in Dubai which ended yesterday.

The event was attended by 13 Arab countries, representatives from the International Postal Union, Saudi Arabian Development Fund and Arab and international firms. The forum explored the plight of the e-government's service, its application in the Arab region and the extent of peoples benefit from it. The forum made a series of recommendations and agreed that e-govermnent to exist, governments should provide legal framework for it, and to give priority to services in the light of the citizens' informational and cultural needs, in addition the safety of the networks. The forum has recommended that ITU in collaboration with the concerned bodies, shall administer and supervise over the "Internet Resources" ( addresses of Internet Protocols, main services and others). The Arab countries have to Co-ordinate to promptly establish and activate Arab corporations which uphold Information Technologies like the The Organization of Arab Information technology; Arab Academy for Electronic Works.

The Arab countries need to encourage the exchange of successful Arab and international experiments in the context of e-government and cooperate in rehabilitating specialised human cadres in electronic fields. Establishing a work team comprising Arab authorities responsible for e-governments in Arab countries to guarantee exchange of information in the realm of strategies, projects, information security and insurance of electronic services is an important requirement of the sector. The forum made some prominent suggestions which have been approved by all the 13 participating Arab countries. The recommendations include unified specifications, categories of certificates in electronic signature, coordination of the terms of electronic signature and electronic linkage system. The Arab countries need to construct a general strategy for e-government.

Khaleej Times, United Arab Emirates, bY Sandhya D'Mello, 26 November 2004

Congress Defuses Attacks on E-gov, Competitive Sourcing

Congress late last week gave two of the administration's top management priorities - competitive sourcing and e-government - a shot in the arm. Lawmakers removed all four provisions in three separate bills that would limit or prohibit agencies from competing federal jobs with the private sector. They also removed a provision that would have prohibited the Interior and Energy departments and the Forest Service from spending $13.3 million on four e-government projects. Additionally, lawmakers removed a provision that would have eliminated the office of the chief architect, clearing the way for the Office of Management and Budget to hire a new one. The provisions were taken out of a nine-agency omnibus appropriations bill that Congress passed late Saturday night. President Bush has not yet signed the bill, but he is expected to do so later this week--after a controversial provision is removed. Language concerning IRS oversight appeared that wording that staff inserted during debate over the bill gave the chairmen of the House and Senate appropriations committees the power to review taxpayer returns. The Washington Post reported that Congress is expected to repeal it Wednesday.

Congress also passed a continuing resolution keeping government spending at 2004 levels through Dec. 3. Under the omnibus bill, agencies will receive a 1 percent increase in spending over 2004, with discretionary spending up to $388 billion. "The House and Senate leadership and the White House wanted to get it done so Congress can start off with a fresh slate," said House Appropriations Committee spokesman John Scofield. "There was no doubt that it was not going to get done." The omnibus appropriations bill provides $3 million for the e-government fund, $62 million for the General Services Administration's Office of Governmentwide Policy, and $35.9 million for the National Archives and Records Administration's Electronic Records Archive project. Congress met or exceeded the president's request for the Office of Governmentwide Policy and for NARA's project, but not for the e-government fund. The administration, once again, asked for $5 million for the e-government fund. Scofield said the White House did not fight for the e-government funding nor did they provide a good enough explanation of how it would be used.

Lawmakers also added a provision requiring every agency to have a chief privacy officer. This person will create policy for privacy and data protection assuring that technology does not "erode privacy protections relating to the use, collection and disclosure of information." The privacy officer will conduct privacy impact assessments; prepare an annual report to Congress on anything that affects privacy, including complaints of violations of the Privacy Act; and help design a training program for agency employees. Agencies also have 12 months from the enactment of the law to establish and implement a comprehensive privacy and data protection strategy, which will be sent to the department’s inspector general to serve as a benchmark. Finally, agencies will have to have an independent evaluation of their privacy procedures every two years to determine compliance with the laws and the effectiveness of the program.

GCN.com, by Jason Miller, 22 November 2004

Public Service A Click Away

The government’s launch of an Internet portal is expected to play a major role in making Barbados more competitive. The Barbados Integrated Government (BIG) Portal was launched last Wednesday at the Savannah Hotel with high expectations that it will contribute to a more efficient Government, provide more services to business and citizens alike on a 24-hour, seven-days-a-week basis and speed up processes involving Government and business, for example, the clearing of goods from ports. These are a few of the aims of the portal, which is intended to bring together all the sources of information on Government at the click of a mouse. It can be described loosely as a website of websites, providing one focal point for information on Government departments. Citizens would have one on-line location to access information held by Government institutions, businesses could download Value Added Tax (VAT) forms and information on VAT, obtain information on progress being made in education, business development and providing citizens at Community Centres with the communication tools to make them more employable in an increasingly competitive environment.

The portal is at a pilot stage and initially caters to a select number of Government employees. One objective is to co-ordinate work within Government more efficiently, make Government more transparent to its citizens and contribute to the work of the Office of Public Sector Reform (OPSR), which has a monumental task of making Government more responsive to citizens and significantly more efficient. In the follow-up phases, the BIG Portal will be a central point for Government's work and citizens will be able to stay at their homes and pay a myriad of bills, for example, renew drivers’. Many of these services are futuristic and will be phased in over many years. Singapore, Canada and Jamaica have been moving to implement e-Government strategies. Jamaica, for example, has been working to automate its customs department so there is pre-clearance of goods and businesses can function more efficiently. Canada has achieved major progress in implementing an e-Government strategy to the extent that its citizens recognise that they benefit from a more efficient system. But Canada's transformation of its public sector via e-Government has taken three decades and the work continues.

Resources available - In launching the portal, which was established and runs under the wings of the Government's Data Processing Department, Commerce Minister Senator Lynette Eastmond noted that progress in adopting e-Government has been made steadily. But the minister observed that such progress is dictated by priorities and the resources available to a small nation such as Barbados. The minister announced that the award of a tender to develop an Information and Communications Technology (ICT) plan for Barbados was expected to be announced shortly. This plan can be seen as a major plank towards making Barbados competitive under the CARICOM Single Market and Economy (CSME), which will open the economy to movement of labour and investment within the Caribbean.

ILLUMINAT, the Barbados-run ICT company, teamed up with ORACLE, a world-leader in database and application software and the team of the Data Processing Department to help develop the portal. ILLUMINAT's director Tony Yearwood said the BIG Portal was created entirely by Caribbean people. He added that ORACLE's "back-end" technology was involved to make the portal an efficient tool for citizens, Government employees and business executives alike. In brief remarks to a gathering of business and Government representatives, director of the Data Processing Department, Yvette Walcott, noted that development of the portal took six weeks and involved volunteers from various Government departments and the private sector. The portal was hailed by Senator Eastmond as "revolutionary" and the work of the Data Processing Department's team was applauded by the gathering.

Nation News, Barbados, by Hallam Hope, 15 November 2004

Seoul to Send E-government Know-how to Moscow

Seoul City's e-government system and know-how is being transferred to the Russian capital of Moscow. Seoul mayor Lee Myung-bak met with Moscow mayor Yuri Luzhkov Thursday (Korean time) and signed a memorandum of understanding pushing the "e-Moscow" project, modeled on Seoul City's e-government. For the project, which will run from 2007 after an investment of W62.8 billion rubles (about US$2.1 billion), Seoul will transfer e-government management know-how to Moscow, and plans call for Korean companies like Samsung and LG CNS to participate in the construction of the system. The two cities agreed to push initial cooperation in three sectors: building an information system center modeled on Seoul's Data Center, digitizing Moscow's real estate registration system, and a globalization project for Moscow's online educational and cultural contents. In order to do this, the two sides agreed to compose taskforce teams for each project as soon as possible.

Chosul Ilbo, South Korea, 4 November 2004

E-Governance Failures Abound

Problems include poor planning, political interference - Many electronic governance projects are failing globally due to poor planning, political interference and bureaucratic bungling, a top World Bank official said Friday. "We are seeing more and more failures," Robert Schware, the bank's lead information technology specialist told delegates at a seminar on e-governance in the south Indian technology hub of Bangalore. E-governance is the use of technology by a government to provide services to its citizens and businesses. About 85 percent of all such projects in developing countries have failed in some respect, Schware said. Of those, 35 percent failed completely, he said, and the statistics in the United States and Europe are just as grim. The Irish government doled out $63 million to test electronic voting technology but an expert group early this year recommended against using it, due to doubts about its accuracy and secrecy. The government is still trying to fix the problems so the project can be resurrected. Uganda spent $22 million on e-voting technology, which did not perform well when elections were held in 2001. In the United Kingdom, an online university project cost $23.5 million, but attracted only 900 students.

In some countries, politicians speed up e-governance projects just before elections to win votes, but end up harming the projects, he said. Schware said one European Union country, which he didn't name, has asked the monopoly telecommunication service provider to put citizen services online in time for elections in 2005. In India, there are about 200 pilot projects for online services, but nearly half of them were designed in such a way that they only work for a handful of the country's more than one-billion people, Schware said. "Now, the challenge is to identify which of those projects can be scaled up and replicated," he added. (The Associated Press)

MSNBC, USA, 5 November 2004

Microsoft Opens E-gov Collaboration Portal

An Irish local government organisation has signed up to a newly launched global e-government initiative from Microsoft. The Local Government Computer Services Board (LGCSB) is one of a handful of government agencies around the world that have signed up to be part of Microsoft's Solutions Sharing Network (SSN). The initiative from Microsoft is an online community-based portal where government organisations and public sector agencies can collaborate and share information on e-government solutions, best practices, applications and architectures. The LGCSB is responsible for providing local authorities with ICT solutions and helping them to develop and implement appropriate strategies and solutions. The organisation has been positive about the SSN so far claiming that it has enabled it to "establish a valuable knowledge bank that will bring tremendous benefit to our community," according to Tim Willoughby, assistant director with the LGCSB.
In line with Microsoft's pledge to help its government clients save money, use of the SSN will be free of charge. Similarly, the tools or solutions that the clients provide are also free to other governments that may wish to adopt them. One of the participants, the London Borough of Newham, for example, posted a customer relationship management (CRM) application that it had developed and which the other member agencies are now welcome to implement. Microsoft said it has developed this initiative in response to feedback from government clients indicating that governments and agencies around the world are duplicating development efforts. By delivering SSN, Microsoft claims it can help to increase operational efficiencies and lower the costs of e-government.

Other government and public sector agencies who have signed up to the initiative so far include: the French Municipality of Parthenay, the German Association for towns and municipalities, ICT for Development in Arab Region project in Egypt, Municipality of Deventer in Holland, the US National Association of Counties (NACo), the Swedish SAMSET project, UNESCO, the Department of Justice and Constitutional Development in South Africa, the London Borough of Newham, the School of Policy Planning and Development at the University of Southern California, and the Department of Informatiks at University College of Boras in Sweden. Microsoft has recently been increasing its efforts to persuade public sector clients not to switch to open source alternatives. In August the software giant signed a lucrative three-year software deal with the UK government, a move that is being viewed as a victory for the software giant in the face of the rising tide of open source software within the public sector. The agreement, estimated to be worth several million pounds, extends Microsoft's existing three-year deal to provide the UK government with software.

ElecrticNews.net, Ireland, by Deirdre McArdle, 10 November 2004

UN Establishes Group on E-Governance

The United Nations today formally established a working group to look at spam, cyber-security and other Internet-related issues in preparation for a summit next year in Tunisia. The Working Group on Internet Governance announced by Secretary-General Kofi Annan will prepare the ground for action on related matters by the second phase of the World Summit on the Information Society >(WSIS) to be held in November 2005 in Tunis. At the WSIS’s first phase held last December in Geneva, countries asked for the establishment of a Working Group to develop a working definition of Internet governance and to identify the relevant public policy issues. The panel is also responsible for fostering a common understanding of the roles and responsibilities of governments, international organizations and other forums, as well as the private sector and civil society from both developing and developed countries. The Working Group will be chaired by Nitin Desai, Mr. Annan’s Special Adviser for the World Summit and includes 40 members from governments, the private sector and civil society representing all regions."We come into this process as facilitators, and will strive to establish a dialogue of good faith among all participants," said Mr. Desai. The panel’s first meeting is scheduled from 23 to 25 November in Geneva. Its report is expected to be submitted to the Secretary-General in July 2005 and will be made available to the Tunis phase of the WSIS.

UN News, 12 November 2004

Microsoft Launches New E-government Services

After the pro-Linux report from the OGC, as well as several notable cases of government agencies worldwide examining the move to open-source systems, Microsoft has launched a new set of portals for the public sector. As part of its many programmes designed to keep government customers happy, the software giant has set up what it calls the Solutions Sharing Network, essentially a series of portals that government entities can use to post their own tips, procedures and even in-house software. There is no cost to the governments that set up the site and the tools that they provide are also free to other governments that wish to adopt them. For example, the London Borough of Newham has posted a customer relationship management application that it developed. "There is no restriction from Microsoft on what's hosted," said Oliver Bell, the program manager for the project. So in theory, a government could post its own Linux implementation? "They could do that," Bell said, but added "I'm not expecting them to."

There are now 13 governments or municipality organisations that have sites live, and Bell said Microsoft hopes to have 200 such sites a year from now. "We're increasingly having conversations with government customers that follow similar themes," Bell said. "One of those themes is the pressure governments are feeling to deliver services more quickly." Microsoft began developing the programme last spring and in September a Dutch city set up a prototype site. Partner Kanalytics is helping the governments set up the sites, which are based on Microsoft's SharePoint portal server software. The move follows other efforts by Microsoft to ingratiate it with local, regional and national governments. Other efforts include a programme to translate Microsoft software into more languages and the Government Security Program, which gives government entities a peek at Microsoft code. "It's a natural extension to some of the work we've been doing with some of those programs," Bell said.

ZDNet.co.uk, United Kingdom, by Ina Fried, CNET News.com, 9 November 2004

ITU symposium on eGovernment and IP for the Arab Region Gets Off to a Rousing Start

The first two days of the Arab Region symposium on eGovernment and IP hosted by Etisalat and organized by eCompany (the Internet and eBusiness unit of Etisalat) in conjunction with ITU, saw delegates from regional governments, private sector and academics engage in a vigorous debate on issues and challenges to embrace a new information society based on a shared vision for enhancing the role of eGovernment in the Arab region. Alexander NTOKO, Chief, E-Strategies Unit, ITU/BDT opened the first session on 'Enhancing communication between government entities ' with an overall perspective on how ITU fulfils its mandate of harnessing the potentials of ICTs (Information & Communication Technologies) for the socio-economic development of developing countries. In his address to the delegates, he also outlined the priority areas for ITU and gave a preview into its work globally going forward. Dr. Emir Mavani, e-Government Project Manager, Ministry of Finance & Industry demonstrated the pioneering work of the UAE Federal eGovernment with insights into its benefits and the strategy of using information technology as a catalyst for enhancing procedures, building citizen centred applications and providing a single point of contact for customers.

A unique perspective on the Egyptian Information Society Initiative (EISI) for Government Services Delivery was given by Mohammed Sameh Bedair, Minister of State for Administrative Development from Egypt. In his presentation he took the audience through their vision for a common gateway for all government entities involved in a business process, the challenges faced and a list of projects identified to counter the challenges starting with a basic infrastructure project for accessibility and authentication to economic databases project for higher levels of transparency and better vision for investors and decision makers. The successes of Dubai eGovernment in meeting its objectives and its ambitious targets also came up for review in a presentation by Mahmood Al Bastaki, Dubai e-government. He also outlined that going forward they would attempt to make 90% of Services online by 2007 with 50% of transactions being conducted on-line by 2007. Making a special mention of UAE and its proactive and innovative approach to eGovernment, Hamadoun TOURE, Director of the Telecommunications Development Bureau, ITU, in a speech via videoconference from Geneva said, "The efforts of countries in the Arab region reflect their serious committment to using ICT to improve services in order to help their citizens embrace the new Information society. The discussions at this conference in the form of Dubai Declaration will be the cornerstone for the World Telecom Development Conference in 2006."

Day 2 of the symposium opened with a session on Transaction based government services. In the opening session, Alexander NTOKO, Chief, E-Strategies Unit, ITU talked to audiences about building trust and security for E-Government which also focused on a Technology Framework for Online Trust based on Data Confidentiality, Data Integrity and Strong Authentication. In an interactive session with delegates, Tariq Habib, Senior Manager, eCompany gave a presentation on the challenges governments face in bringing eServices to citizens and businesses, and in the process delivered insight into a four step methodology to manage the challenges of delivering eServices starting with a dedicated project management office. Summing up his impression of the symposium, Saddig I .Al Tayeb, General Manager, Licensing, Communications & Information Technology Commission (CITC),Saudi Arabia said ' The discussions here reflect a commonality on the problems faced by the region in implementing eGovernment. It gives us a valuable opportunity to share knowledge and avoid pitfalls in a eGovernment rollout.'

"The symposium was very successful in bringing the practical implementation of eGovernment into focus', said Abdelaziz Osman A/aziz, CEO & General Manager, Sudanese Telecom Co. Ltd. ' It was very effective in highlighting the challenges of eGovernment implementation and the discussions were indeed very useful and illuminating." The session on Regional Strategies saw presentations to delegates from countries around the region starting with a look at 'Transformational Models from Traditional to Digital Governments' by Dr. Farid EL-NAJAR, Benha University, Egypt. eProcurement and the impact of Tejari with its dramatic cost savings, greater efficiencies and greater market reach came up for review in a presentation by Saqib Iqbal, CEO Tejari.com. The session also gave delegates an opportunity to understand the developmental issues of eGovernment in Sudan in a presentation by Asim Abdelwahab Abdorabo from Sudatel. The days proceedings was rounded of with a session on Internet Governance and the World Summit on Information Society with Desire Karyabwite from ITU giving the audience an insight into Best practices for DNS and IP addresses Management including IPv6 implementation. The timeframe for migration from IPv4 to IPv6 also came up for discussion. The challenges and issues faced in Yemen and the transformative role of ICT((Information & Communication Technologies) in the country was the subject of a presentation by Samira A.M Salem, Ministry of Telecom & IT.

AME Info., United Arab Emirates, 23 November 2004

Government to Absorb Expenditure of IRS

Kumasi (Ashanit – Ghana) - The Government is considering the possibility of absorbing the capital expenditure part of the Internal Revenue Service (IRS), Yaw Osafo-Maafo, Minister of Finance and Economic Planning, has said. "This, I believe is still being worked out and hopefully, it may come out that the expectation of workers will be met". This was contained in a speech read for him by Dr Wahaab Alhassan, Director of Policy Analysis Division of the Ministry at the opening of the fourth quadrennial national delegates’ conference of the IRS division of the Public Services Workers Union (PSWU) in Kumasi on Monday. The three-day conference was on the theme: "Sustaining the Growth and Development of the Economic of Ghana through Direct Tax Mobilisation, The Role of Labour". Osafo-Maafo said he was happy that the workers union was looking for ways through which labour could help mobilise direct taxes to sustain the country's growth.

The Minister noted that sustaining growth implies stability, which is a precondition for sustained growth and stressed that a country wishing to attain and sustain macroeconomic stability needs to reduce excess aggregate demand throughout the economy."This condition is the key to the achievement of a sustained growth and is one area where labour plays a vital and crucial role", Osafo-Maafo said. He said labour has an important part to play in the administration of taxes as it is clear that tax administration has become extremely important both to those concerned with increased tax yields and those concerned with tax policy and its effects on the economy in general. Mrs. Janet Opoku Acheampong, Commissioner of IRS, said direct tax collection is very difficult and cumbersome and that is why the government raised the Service's retention percentage to 2.8 per cent from the previous 2.5 per cent. She pointed out that the benefits of any increase in the retention percentage will depend on the efforts of the staff and stressed that management was evaluating every unit and district on weekly basis and non-performing district heads and their subordinates were being given the necessary signals. Mrs. Acheampong announced that the Service would introduce tax stamps next year to widen the tax net, hoping that the staff would do well to help it work.

Ghana Review International, 15 November 2004

International Finance Corporation Assures PNG of World Bank’s Support

International Finance Corporation (IFC) Executive vice president Peter Woicke has assured Papua New Guinea that it will get the "partnership" of the World Bank Group. Speaking at a cocktail reception in Port Moresby last Thursday night in his honour, Mr Woicke also the managing director of the World Bank Group said, "PNG is a perfect country for the WB to work with as a partner and I think we can achieve a partnership with the government and the private sector to build infrastructure." Mr Woicke further said despite the “rocky” relationship PNG has had with the WB in the past, he will ensure the "relationship will become a true great partnership in the future". He said: "it is time to change our attitude and become a partner because there is so much to do, while there is a lot of willingness on both sides."

Mr Woicke was in the country last week on a four-day visit to find out how IFC and the WB could serve PNG "a little bit better". During his visit with his wife and some IFC staff, he visited some major projects, met with business leaders in the private sector and key government executives, learned about PNG's diverse cultures and viewed the beauty of the country in some provinces. "I really think this is part of doing business here because if you don’t understand the culture and the country, it is difficult to do business. "Obviously there are lots of challenges in this country like geographic challenges, while infrastructure needs tremendous improvement and it will cost a lot of money. "I believe in free markets, I do believe in capitalistic system as long as it is corporate social responsibility, but I think a lot can be done by the private sector. "We need public private partnerships to build infrastructure to get the agriculture products to markets from the highlands, and we need to build the roads," Mr Woicke said.

Mr Woicke has told governments including the PNG government that it is a shareholder in the WB and IFC who are ready to provide financial services."I will certainly go back to Washington with the feeling and understanding that we in the IFC can finance projects in the financial markets and agriculture and I will make sure that our experts will return as fast as possible to work with you for the benefit of the country." FC will dispatch a team to the country to examine its microfinance in the hope that it will become a core investor in this area of small financing. Established in 1956, IFC is playing a significant role in promoting sustainable private sector investment in developing member countries, helping reduce poverty and improving people's lives.

The National, Papua New Guinea, 8 November 2004

MoF Withholds Development Funds

Islamabad - 65% of schemes running behind schedule - The ministry of finance (MoF) has withheld the release of funds for most of the development schemes of various ministries for the second quarter as fund utilisation on uplift schemes remained below 50 percent during the first quarter, according to a letter of the ministry sent to various ministries."Only projects with 100 percent utilisation of their funds during quarter ending September 30, will be qualified to get 100 percent release for the current October-December quarter," the letter said and added that the release for such projects will be made in accordance with the cash/work plans submitted by ministries. The submission of cash/work plans to seek release of funds in each quarter is a new concept which was introduced in the 2004-05 budget in order to ensure maximum utilisation of the development funds and successful execution of the uplift schemes across the country.

Slow progress: A senior government official said more than 65 percent of the development schemes have been running on very slow pace and added that the finance ministry will not release funds for such projects during the second quarter. The mechanism was adopted after the first quarter review held in the Planning and Development Division (P&D) early this month. The deputy chairman of the Planning Commission, according to the official, was not pleased with the pace of utilisation of funds and implementation of schemes during the first quarter of the current fiscal. Before the 2004-05 budget, the government was concerned over the slow pace of work on development schemes, the official said and added that the government was eager to enhance the public sector development funds, ensure maximum utilisation of funds and successfully execute the development schemes.

The government enhanced the volume of Public Sector Development Programme (PSDP) from Rs 160 billion in the last fiscal to Rs 202 billion for the current fiscal while number of schemes were increased from around 1,000 last year to around 1,300 in the current fiscal year. Prudent funds disbursement: According to the letter of the finance ministry development projects with utilisation between 50 percent and 80 percent will get only 50 percent of what they demanded in the cash/work plans. The finance ministry has informed ministries that there would be no release of funds for the development schemes whose utilisation remained nil or below 50 percent during the current second quarter. But such projects were allowed to use their funds, which were available with them during the first quarter as the finance ministry released 25 percent of the total allocations to the ministries for the period. The projects were also directed to review their cash/work plans before the close of the current quarter. "This conditionality has been put on the ministries so that their projects could get funds in the third quarter," the letter said.

PM chairs review meeting: Meanwhile, Prime Minister Shaukat Aziz has reviewed the progress on the implementation of development projects under the PSDP programme during the first quarter of the financial year and 22 percent of total rupee allocations for development projects. According to a statement issued on Wednesday, the prime minister directed that pace of the development must be accelerated so that the people could see the change. According to the statement, he said that development process should not be delayed and the planning commission should ensure and provide necessary support for timely completion of projects within the sanctioned cost. He directed the Planning Commission to strengthen the monitoring process. The commission should hold regular review meetings with the concerned executing agencies. The funds of slow moving projects could be transferred to fast moving projects to ensure timely completion, Mr Aziz said.

Daily Times, Pakistan, by Fida Hussain, 11 November 2004

Manila's Fiscal Fallback Defies APEC

Santiago - Free and open trade facilitates economic growth. While this Asia-Pacific Economic Cooperation prescription is in line with the common market of the Association of Southeast Asian Nations Free Trade Area (AFTA), it runs counter to a Philippine solution to fiscal crisis involving tariff hike. The 12th APEC summit here pursues the 1994 Bogor Goals of trade liberalization as a transition declaration with 2004 thematic agenda,"One Community, Our Future." Embracing AFTA's evolution mix toward a zero-tariff border­less trade, it goes against the plan of the Arroyo government to impose a 3-percent surcharge on almost all products imported from other Southeast Asian countries. Manila is in deep budgetary trouble and the AFTA reversal of tariffs will inevitably result in a fiscal gap of billions of pesos. That means neighboring goods that already enjoy downgraded or zero duty under AFTA's Common Effective Preferential Tariff (CEPT) will enter the Philippine market with higher landed cost for bigger revenues due to the surcharge levy.

Under the AFTA-CEPT scheme, tariffs on manufactured products traded among Asean members will be reduced to 0 to 5 percent by the year 2003. But as gradual tariff reduction is implemented, CEPT products enjoying Preferential Tariff Agreement (PTA) treatment will move more freely in the region because they enjoy margins of preference or trade discounts of 25 to 50 percent as the most favored nation (MFN) rate. For example, a product whose tariff rate has been reduced to 5 percent enters an Asean member country at only a 2.5-percent rate because of a 50-percent tariff discount authorized under the PTA as an intragovernment pact among the regional members. This means that preferential treatment will continue to distort CEPT's tariff structure because PTA is politically tethered to the economic luxury of the conclave.

Asean members in APEC are the Philippines, Brunei, Singapore, Thailand, Malaysia and Indonesia. What has been big talk about having a common market to propel the six countries to economic prosperity is now industry noise that threatens to rake up AFTA. The Philippines prematurely complying with the tariff cut is a question of policy, and one that translates to exigency in public finance function. All this waywardness happened during the leadership of former President Fidel Ramos. In unnecessary gesture to play sycophancy with the World Trade Organization and with the 1996 APEC leaders in Manila, he pushed for the early tariff reduction at his fancy without a clear mind as to what would happen next. The self-embroidered leader was in deep slumber with his tiger cub fairytale only to wake up later with a lizard economy ailing on his lap. Despite claims by President Macapagal-Arroyo that Philippine economic recovery is on track, with the solution to the budgetary crisis in sight, exports remain anemic and joblessness continues to increase social misery. As textile quotas end and global competition sidetracks Philippine electronics for a weak merchandise account, the resulting industrial slowdown would aggravate unemployment. The life support system to revive the economy is nonmerchandise inflows, i.e. overseas manpower income and new dollar loans.

How the Philippine government would solve the fiscal problem through tariff hikes without stepping on the toes of Asean partners and without the APEC blowing the whistle would be interesting to watch. Using the fiscal disaster as pretext for the duty reimposition makes Mrs. Arroyo more controversial than reasonable under the common policy matrix of AFTA and APEC. She should then sharpen the collective mind of her economic managers into a public relations giant that can mold favorable opinion from the lapses of AFTA, and of the economic conclave that would say one thing and do another. The flexible deadline for tariff cut compliance is an experience that led to Manila's industrial breakdown. When AFTA set the groundwork for the CEPT in early 1995, there were disturbing reports that some Asean members submitted for PTA coverage nonsensitive products they were not manufacturing. This was an underhanded move that put the Philippines at a disadvantage. On the other hand, Manila's economic managers listed sensitive products for inclusion in the PTA coverage without consulting the private sector. Products actually manufactured by these Asean members will remain strongly competitive in their home markets against neighboring brands owing to the fact that their tariffs are not subject to gradual reduction or removal because of the trick list.

On average, while the Philippine imposed a 15-percent duty in 1996, Thailand and Indonesia had imposed 25 percent and 30 percent respectively. With a commitment to reduce the duties to 10 percent to 15 percent the following year, the Manila government would have a market vulnerable to bigger inflow of cheaper products from neighboring countries whose domestic industries remain protected. Thailand refused to reduce the 25-percent duty in 1997, while Indonesia was forced to cut it down to 25 percent. Trade disaster is reflected in Manila's paint industry where a 10-percent duty is slapped on a finished product, while the government imposes similar 10-percent duty on an intermediate product (alkyd) and 25 percent on raw material to alkyd (ethyl alcohol), to the detriment of local manufacturers. Malaysia, which manufactures and supplies titanium dioxide as raw material for paints in the region, could take advantage of this defective tariff mix. What a lousy way to be shortchanged in neighborhood trade. And the Arroyo government should wake up from a trance of mediocrity in the face of increasing complication in global business and economy.

Manila Times, Philippines, by JCM Romero 3rd, 18 November 2004

'Finance Panel Must Be A Permanent Body'

World Bank along with economic think-tank National Institute for Public Finance and Policy have strongly pitched for making finance commission a permanent body like planning commission, although government has some reservations on it. "There are three institutional reforms that would help the functioning of fiscal federalism in India. The first would be if the finance commission were made a permanent body, as it is in Australia," World Bank said in a report on state fiscal reforms released on Tuesday. The move would improve coordination and state-level fiscal data collection, it said. Supporting World Bank's views, NIPFP director Govinda Rao said the finance commission should be made a permanent professional body, which would carry out proper monitoring of policy implementations in states. At present, the finance commission is constituted every five years to work out the devolution formula for sharing tax revenues between the Centre and states. Rao said every five years, bureaucrats and economists are appointed in the finance commission on deputation. This restricted the commission to have adequate information on states and hence carry out proper analysis of their requirements. Advisor to Finance Minister Parthasarathi Shome, however, said there should be greater analysis on why there was a need to have a permament finance commission. World Bank said there was a need to have a single agency that can compile state level fiscal data to provide credible reporting of the performance of the states against the targets fixed for them.

Rediff, India, 23 November 2004

Few Takers for World Bank’s Idea of a Fixed Finance Body

New Delhi - World Bank's suggestion of making Finance Commission a permanent body has evoked sharp reaction from the economists' community. While one set of economists appreciated merit in World Bankss recommendation, others including adviser to finance minister Parthasarthi Shome felt the "magic of Finance Commission is in its disappearance". While discussing the World Bank’s report on 'State fiscal reforms in India: progress and prospects', Dr Shome said that probably the ephemeral nature of Finance Commission prompted it to give "extremely good and analytical reports". On the other hand Planning Commission is a premanent body which needs to be overhauled, he added. The World Bank report, Dr Shome said, did not make a comparative study of the function of the two bodies. "One has to think of advantages of having a permanent body before taking a view," he said. When Dr Shome wanted to know whether it was professor Amresh Bagchi who had been advocating the need for a permanent structure for Finance Commission, Dr Bagchi said "not me" and pointed to National Institute for Public Finance and Policy (NIPFP) director Govinda Rao.

Dr Rao commenting on the World Bank's suggestion said, "What I have been advocating is that Finance Commission should be a body of professionals with a permanent secretariat. Every commission should not start afresh by collecting data. The commission can keep data. Five wise men can be appointed for a fixed term and the commission can be reconstituted periodically." Dr Rao also made a strong case for demarcation of role of Finance Commission and Planning Commission by stressing “overlapping role is nobody’s baby". He suggested that Planning Commission could look after infrastructure sector. Dr Bagchi suggested that there was a need to review the role of Planning Commission. He also wanted the Planning Commission to do away with the ritual of annual consultation of each state.

The World Bank too suggested overhaul of the role of the Planning Commission. The report, which was released by World Bank country director Michael Carter, has recommended introduction of voluntary value added tax on the basis of floor rates, enhancement of the ambit of service tax and imposition of professional tax, delinking of block grants and loans, adoption of a policy of hiring restraint (zero net hiring) and real wage restraint and better subsidy management. "Radical restructuring of state finances is necessary for faster development and also elimination of revenue deficit by 2007-08," Mr Carter said. The average revenue deficit of poorer states is now at 3.5% of gross state domestic product while it is 2.5% for richer states. The fiscal deficit of poorer states can come down from 6% to 3% after reforms while it can be cut down from 4.5% to 2.5% for richer states. "State governments have significant, if not the main responsibility, for many of the developmental areas - roads, irrigation, health and education, which the bank is financing. If state finances are not put on a stronger footing, the sustainability of investments cannot be assured and government effectiveness will continue to suffer," Mr Carter added.

Financial Express, India, 24 November 2004

Germany Unveils Measures to Fill Public Finance Deficit

Berlin - The German finance ministry unveiled a raft of measures aimed at bringing the country's public deficit back into line with eurozone rules. Compared with previous forecasts for the deficit to brought back under the three-percent of output limit in the eurozone, German public accounts would next year show an additional shortfall of 10 billion euros (12.9 billion dollars), the ministry said in a statement. Germany's tax revenues this year and in 2005 are expected to be 4.8 billion euros, or 0.53 percent, less than previously forecast in May, the finance ministry said. The ministry said that revenues will be 1.4 billion euros lower this year, at 442.4 billion euros, compared with the 443.8 billion euros forecast in May. For 2005, tax revenues were seen 3.4 billion euros lower at 450.1 billion euros, from a previous estimate of 453.5 billion. Despite the decline, the ministry said the government "is still holding on to its 2005 goal of having a budget deficit that will again return to below" the eurozone criteria.

The German government aims to plug the hole in its finances in part by securitizing funds linked to the pensions at Deutsche Poste and Deutsche Telekom. Part of the two semi-privatised companies employees are in effect civil servants and their retirments must therefore be paid by the state. In compensation, the two companies are supposed to pay the state 18 billion euros. The state aims to convert these expected revenues into securities which will be sold to investors, generating 5.5 billion euros. The government also plans on scrapping a public holiday on October 3, which will now be held on the first Sunday of that month. The economic growth created with one more working day was expected to have a positive impact of a further 500 million euros on public finances. The government would also freeze civil servants' wages in 2005, which will have a positive impact of two billion euros on the budget.

The 12 nations using the euro are bound by the European Union's 1997 Stability and Growth pact to hold their annual public deficits to less than 3.0 percent of gross domestic product (GDP). But Germany, the largest eurozone economy, has repeatedly failed to meet that requirement and, according to the International Monetary Fund, could do so again next year if it does not take action. The ministry, which was expected to hold a news conference on the new figures later Thursday, said most of the decline in revenues were due to a fall in taxes on petroleum products. The estimates were made by a working committee comprising finance ministers from the federal states and the national government, which meets twice a year to draw up a forecast on tax receipts.

Turkish Press, Turkey, from Berlin (AFP), 4 November 2004

IMF Prefers Phased Higher Retirement

The International Monetary Found has said an earlier and phased raising of the pension age, set for 2008, would have been "preferable" for the country. The IMF delegation, headed by Carlo Cottarelli, was positive on the pension reform, passed by parliament in July. In a report, the IMF said: "The recent pension reform is a key step toward long term fiscal sustainability, although an earlier, phased increase in the retirement age, rather than a step increase in 2008, would have been preferable." "Implementation decrees for the pension reform should be introduced as scheduled starting with those related to the reform of the TFR [trattamento di fine rapporto, or end of career indemnity]." The investment of the TFR in pension funds is going to be a pivot of the pension reform, aimed at ending the expensive pay-as-you-go system and keep Italians at work until they are 60. At present the government is trying to get workers of the private sector, who become eligible to retire under the old regime before 2008, work longer with the promise of a tax-free perk. The bonus consists of a 32.7% extra on monthly wages for 57 years of age with 35 of contributions.

This amounts to the sum that should have been paid to the national social security institute for the private sector, INPS. Public employees are not eligible for the bonus "for reasons of compatibility with public finance", according to welfare minister Roberto Maroni. This perk - known as 'super–bonus' - has become officially operative at the end of September and will be in place until December 31 2007. The IMF report went on to say there could be a five to six billion-euro hole in the public accounts, 0.4% of gross national product. It has also recommended a reform strategy focusing on containing of primary spending of the government, for fiscal sustainability, deepening labour market reforms and boosting competition in product markets. Tax-cuts plans, promised by the prime minister, should be postponed.

IPE.com, UK, 11 November 2004

Finance Ministry to Amend Legislation to Ease Tax Burden on Citizens, Economy

Belgrade - Serbian Minister of Finance Mladjan Dinkic has announced changes and amendments to several tax-related laws in a bid to encourage economic growth and boost employment. The government has cut budget spending, creating conditions for a substantial reduction in tax burden on the economy and citizens in 2005, Dinkic told a press conference today. The Ministry has proposed changes and amendments to several tax laws, which the parliament's economy committee approved yesterday, said Dinkic, noting that the government is due to debate the proposed legislation at a session tomorrow. As of January 1, all companies opening new jobs will be granted a one-year exemption from the 14 percent income tax under changes and amendments to the income tax law, said Dinkic. The measure, which aims to create more jobs in the economy, will reduce corporate taxes and contributions from 77 percent earlier this year to 52 percent, he explained. A new law on contributions will scrap taxes and social contributions for companies employing people over 50 years of age, the Minister added. Businesses subject to the 14 percent profit tax will be allowed a four percent cut so they can be competitive with hypermarkets, Dinkic also noted. According to Dinkic, the proposed legislation also calls for abolishing agricultural revenue tax, as well as excise tax on diesel fuel for tractors, construction machinery and ships. It also stipulates a 30 percent cut in fuel prices for farmers. Changes and amendments also concern the abolishment of all taxes burdening trade in stocks and securities to help develop the capital market and reduce interest rates.

As of January 2005, banks will be exempt from financial transaction, service and turnover taxes, in a move that will save some 10 billion dinars in the banking sector and cut interest rates. The Minister further announced stricter fines for property tax evasion, which he said will be two to twenty times higher than the tax amount. As part of the press conference, Dinkic presented the first issue of the Serbian public finance bulletin, designed to inform the public on Serbia's public revenue and spending every month. According to him, Serbia's budget deficit in the first ten months of the year fell by 10 billion dinars, year-on-year, to 21 billion dinars. In October alone, the deficit stood at 1.7 billion dinars, a level planned for the same month next year as well. Budget revenue in January-October climbed 20 percent year-on-year, he went on to say, noting that a 22.3 percent rise in sales tax revenue came as a result of the introduction of fiscal cash registers.

Invest in Serbia, Serbia and Montenegro, 10 November 2004

Italy Could Reign in Public Deficit Next Year

Milan (AFP) - The Italian central bank estimated the government could bring the public deficit down to 2.7 percent next year, but expressed doubt regarding a growth forecast by the International Monetary Bank. "Uncertainty regarding oil prices and foreign exchange rates" weighed on the IMF's growth forecast of 1.7 percent, the Bank of Italy said in its monthly economic bulletin. Any rebound in 2005 would be "modest" and "remain unsatisfactory" because Italy continued to lose market share, said Salvatore Rossi, the bank's director of economic studies. Italian officials expect the public deficit to fall to 2.7 percent next year, and gross domestic product to expand by 2.1 percent. But both the IMF and the European Commission warn that Italy could breach the EU Stability and Growth Pact's public deficit ceiling of 3.0 percent of GDP if Rome does not include new spending measures in its 2005 draft budget. According to the fund, additional savings of five-six billion euros must be found if Italy is to remain within the pact's limits. On October 21, Dutch Finance Minister Gerrit Zalm warned that Italy was one of four countries at rist of exceeding the limit next year. The Netherlands currently holds the European Union's rotating presidency. Meanwhile, the Italian deficit goal of 2.7 percent is attainable, but "it will take close watching to avoid excess spending," Bank of Italy research director Giancarlo Morcaldo noted Monday. The central bank also expects inflation of 2.2 percent in 2005 as high oil prices affect household energy spending.

Turkish Press, Turkey, 22 November 2004

Poland's Central Bank Head: Public Finance Reform Bills Must Pass to Ensure GDP Growth

Warsaw. (Interfax-Europe) - Poland's long-term economic growth depends on passing legislation that can effectively reform the country's public finances instead of blocking initiatives, which could widen the government budget deficit, National Bank of Poland Governor Leszek Balcerowicz said after a meeting of the bank's Monetary Policy Council (RPP) Wednesday. "Rapid [gross domestic product] growth depends on implementation of bills focused on reforming public finances," Balcerowicz said. "Blocking such initiatives leads to an increase of the deficit."

This comes in the midst of a battle between the Ministry of Finance and the Polish Parliament over the fiscal reform bills needed to complete the 2005 budget, now blocked in the country's lower house of Parliament. Polish Finance Minister Miroslaw Gronicki said Wednesday that the government could raise fuel excise taxes by between 5% and 10% to cover a PLN 1 bln revenue shortfall in the 2005 budget created after Parliament rejected two crucial budget bills last week. The RPP also said in a statement after the meeting that long-term, stable economic recovery will depend on public-finance reforms, the lack of which would create debt levels that are "too high" as a percentage of GDP. This in turn may lead to a significant increase in Poland's investment risk premium, which, coupled with eventual depreciation of Polish currency, could be a source of inflationary pressure. Gronicki also said Wednesday that a tax increase like this is the worst possible solution, because increasing indirect taxes could push inflation to accelerate.

Interfax, Russia, 25 November 2004

Mills to Head Oppenheimers' New Think-Tank

The outgoing head of the South African Institute for International Affairs, Greg Mills, is to become the director of the Oppenheimer family's Brenthurst Foundation, a new research body. Mills will join the family company E Oppenheimer & Son in April 2005 to direct the foundation and conduct research related to the family's investments in Africa. "This is a new challenge, with enormous potential to make a difference," said Mills last night. The foundation emerged from the Brenthurst Initiative, which was launched in August last year, and aims to carry the work of the initiative forward by stimulating debate and research on the transformation and economic upliftment of Africa. "The aim is to answer a single question which is fundamental to African stability and prosperity: how do we get African economies to grow faster?" he asked. The foundation advocates public-private partnerships in formulating strategies for aggressive economic growth in Africa generally, and SA in particular. "Such collaborations are especially important in Africa because investors have often lacked confidence in the overall business environment," the Oppenheimer's family company said in a statement. "Yet private sector initiative, energy and finance are critical to positive growth trajectories. "The foundation will draw together distinguished local and international governmental and nongovernmental expertise to investigate both the macro- and micropolicy alternatives and global dynamics to achieve sustainable economic development. "The Brenthurst Foundation fundamentally aims to find ways to improve rates of local and foreign investment necessary for continental regeneration and prosperity," the company said.

AllAfrica.com, Africa, by John Fraser of Business Day, Johannesburg, 17 November 2004

Federal Government Approves Privatization of Hostels in Federal Universities

Federal Government has approved the privatization of hostels in all the federally owned Universities as part of efforts aimed at ensuring that university administrators focus their attention on teaching and research. President Olusegun Obasanjo in an address sent to the 56th convocation ceremony of the University of Ibadan yesterday declared that henceforth university authorities will no longer be involved in hostels management in the nation's federal universities. The president in the address read on his behalf by the Executive Secretary of the National Universities Commission Prof. Peter Okebukola said: "The Universities are being encouraged to concentrate on their core business of teaching, research and service to the Nation". "In order to further reduce sources of diversion and upgrade living conditions for students, government has directed tertiary institutions to commence consultations with all stakeholders in order to produce modalities for the effective management of students' hostels and the provision of new ones through private partnership agreements". "Once this is effected, our universities will be able to concentrate on the provision of state of the art teaching and research facilities. This can only impact positively on the quality of our products", President Obasanjo said. According to him, government, on its own part, will continue to provide the necessary support and enabling frameworks and respond to the needs of our educational institutions with boldness, imagination and vigour. It is in this regard that government has increased funding to universities in the next budget". Said he: "A sum of N50.6 billion was allocated to the universities sub-sector in the current financial year, while for 2005; the sectorial allocation is the third largest Direct Teaching and Research grants also have been reintroduced to enable academic departments fulfill their roles".

President Obasanjo asked Nigeria universities to rise up to the challenges posed by the economic situation in the world saying, "this means producing graduates that serve the needs of our country as agents of change for a more vibrant civil society, able to consolidate democracy through commitment to the rule of law, justice, equity and best practices." While lamenting the level of crisis in the nation's universities, the Vice-Chancellor of the premier university, Prof. Ayodele Falase said "it is quite worrisome that on most occasions, the issues in contention are so befuddled that one can hardly understand why the university authorities are made to be at the receiving end of the bouts." Prof. Falase who reeled out the several achievements of his administration in the last four years remarked "it is with great delight that I announce the history that is being made today! The University of Ibadan is producing, at this ceremony, the first Nigerian Ph.D holder in Nursing. She is Clara Oniovokoyubu Agbedia".

AllAfrica.com, Africa, by Sina Babasola, Vanguard, Lagos, 18 November 2004

More 'Mzansis' for South Africa

The private sector can expect to play a greater role in improving the quality of life of all South Africans in the next 10 years than it did in the last decade. That was the message from finance minister Trevor Manuel at a Bureau for Economic Research conference entitled "The South African Economy: The Next 10 Years" in Somerset West this week. Manuel said he believed that the “defining characteristic" of the country's financial architecture in the next decade will be the quality of public/private partnerships. "Our Financial Sector Charter provides a framework within which substantial capital resources of the banking sector and other financial institutions will be mobilised in pursuit of public policy purposes. "I believe the defining characteristic of the further construction of our financial architecture over the decade ahead will be the quality of partnership, the underlying relations of trust, that we forge in this joint project," he said. Broad strategic policy challenges involve "important kinds of co-operation and partnership between the public and private sectors". He said the Mzansi bank account aimed at the previously unbanked was a "welcome response" of the private sector to a public interest, adding we could see similar initiatives aimed at that market, for example for life assurance and medical cover. Manuel said there are "aspects" of the longer term fiscal policy trajectory on which "even the National Treasury has an incomplete view". However, “careful consideration” would be given to the “evolution of the social assurance system".

"Many countries have chosen to finance collective pension arrangements, health care, disability and unemployment benefits through payroll taxes or social security contributions, variously imposed on employees, employers or both". These taxes "raise the cost of employment, but on the other hand they contribute to stabilizing labour market participation". Government fixed capital formation is expected to grow by about 7% a year in real terms over the next three years, while investment by public corporations will continue to increase strongly. The public sector borrowing requirement is expected to "widen somewhat" over the decade head. "For the next three years we anticipate a widening of public sector borrowing from under 1% of Gross Domestic Product in 2002 to 4,6% in 2007, and interest on public debt will stabilise at about 4,5% of GDP", said Manuel. An acceleration in infrastructure investment cannot be entirely financed through debt. "This is of course why the profitability and balance sheets of public enterprises are so important, but it is also why we have put considerable effort into developing a robust programme of public/private partnerships, which bring private equity and non-recourse debt finance into selected areas of public infrastructure financing," said Manuel. He said he is still a "Cape Flats housing activist" in his "dreams and nightmares". As a result, an improved urban landscape, better public transport and a general improved quality of life for ordinary people are important to him. "The reconstruction of our cities is a joint responsibility, and the role of private finance is recognised in our new Municipal Finance Management Act," he said. A longer-term "suggestion" is that the "structure of both public and private investment in the infrastructure of our cities will deepen considerably over the years ahead", Manuel said.

Moneyweb, South Africa, by Jackie Cameron, 18 November 2004

China and the United Nations Development Program (UNDP) Sign Project Paper

Beijing - China and the United Nations Development Program (UNDP) signed a project paper here Wednesday to set up the China-Africa Business Council (CABC). The CABC will be a joint program the two sides would use to further boost Sino-African trade cooperation especially in privatesectors. And it is believed to be the first Public-Private Partnership initiative between China and Africa under the South-South Cooperation Framework, said Khalid Malik, UN Resident Coordinator in China. He said at the signing ceremony that China has been the anchor for South-South cooperation and its government is committed to upgrading China's ties with Africa politically and economically. China is striving to find new ways to boost bilateral trade and investment links.

There exists a huge potential for increased trade and investment between China and Africa, Malik said, noting that the economic cooperation between China and Africa impacts African countries in the development of capacity building and skills development, and promotes the role of the private sector as a key player in contributing to growth in trade, investment and nationaldevelopment. Malik cited the project as a key initiative to help strengthen China Africa economic link through promotion of Public Private Partnerships and said it will become a new economic mechanism to help facilitate information sharing and access, thereby deepening the Sino-Africa trade and investment in a concrete way, Malik acknowledged. According to the project, the CABC will provide practical support to the private sector to help conduct trade and investmentactivities in Cameroon, Ghana, Mozambique, Nigeria, South Africa, and Tanzania. The project will also establish a network of linkages with a wide variety of players both nationally and internally across the China-Africa business spectrum.

Xinhua, China, 17 November 2004

Latest Developments In Privatization

As mentioned in our previous articles, Turkey’s privatization program continues to be one of the hottest topics in the Turkish economy. The Government's desire to privatize entities in the privatization portfolio has intensified in order to achieve the goals set forth by the International Monetary Foundation ("IMF"). Pursuant to the IMF Letter of Intent for the 8th review, proceeds acquired from privatization have reached USD $311 million in the first quarter of 2004. Pursuant to the information provided by Metin Kilci, the Chairman of the Privatization Administration ("PA"), the projects are carried out in accordance with the privatization agenda; the privatization of 14 entities has been finalized and the contractual negotiations are continuing for 7 other entities. Furthermore, new amended procurement legislation for public entities eases the procedure for the recruitment of outside consultants.

Although many of the relatively minor enterprises have been privatized, there were substantial difficulties in finalizing the privatization process for some well-known and publicized projects in 2004. Below are the new developments in Turkey's privatization journey:

TUPRAS: As reported in our Spring issue, Efremov Kautschuk Gmbh, a subsidiary of Tatneft, the Russian petroleum conglomerate, offered the highest bid of USD 1,302,000,000 to acquire the 65.76% government stake in TUPRAS. Following the approval of the Privatization High Council, Efremov Kautschuk Gmbh, together with its Turkish partner, Zorlu Holding A.S., started the negotiations for the share purchase agreement to be executed with the PA. However, the privatization process in TUPRAS has been challenged by the Labour Union (Petrol-Is). Although the closing was expected for the end of May 2004, the privatization process and sale of TÜPRAS have been ceased as a result of the administrative court's ruling cancelling the Tender Committee's decision for the sale of 65.76% government stake in TUPRAS to the winning bidder. Currently, the judicial process continues with regard to several lawsuits initiated by Petrol-Is against the PA and the Government awaits finalization of the judicial process before taking any action. As a result of the legal actions initiated against the most promising privatization project of the year 2004, the Government may face difficulties in complying with its undertakings concerning privatization income as projected in its latest Letter of Intent to the IMF.

TEKEL: As reported in our Spring issue, the privatization of TEKEL Tobacco, Tobacco Products, Salt and Alcohol Enterprises ("TEKEL")'s alcoholic beverages section was completed as of 27 February 2004 following the execution of the Share Purchase Agreement between the Nurol-Limak-Özaltin-Tutsab joint venture and the PA. Privatization of TEKEL's cigarette section, however, continues to be considered as one of the major privatization projects in the portfolio of the PA. In the last two months, discussions relating to privatization methods for Tekel Cigarette hit the newspapers again. Although in June there was news stating that the privatization of TEKEL Cigarette would be via block sale and separate sale of trademarks is not considered as a privatization method, the PA did not make any official announcements in that respect. Accordingly, changes to the privatization method for TEKEL Cigarette may still be expected, since the Chairman, Metin Kilci, noted that the method of privatization would probably be determined by the end of this year.

TURK TELEKOM: The PA recently selected the outside financial and legal counsels for TURK TELEKOM privatization. It is reported that meetings are ongoing for the provision of information on legal, financial and organizational aspects of the privatization. According to recent news, the PA plans to privatize TURK TELEKOM in October. The proposed privatization of TURK TELEKOM, is expected to include its cable TV and Internet operation rights. However, based on recent news, following the privatization, the purchaser may be obligated to sell the concerned operation rights within a specified period.

NATIONAL LOTTERY ADMINISTRATION: As reported in our Spring 2004 issue, the PA resolved to privatize the National Lottery Administration ("NLA") by granting separate operation licenses for each lottery activity, instead of block sale or public offering of the entity. Although the preparations for the tender process were expected to be finalized by the end of June, no official announcement has been made yet by the PA concerning the tender specifications. The privatization of NLA only includes lottery activities. Furthermore, a pre-payment and profit sharing system is planned to be established for a term of 10 years. Pursuant to the information provided by the Chairman, Metin Kilci, NLA's privatization process is still ongoing and planned to be concluded by the end of this year.

ENERGY SECTOR: In line with the privatization plans, categorization of electricity production and distribution facilities is completed. Accordingly, production facilities are categorized into six groups and are planned to be included in the privatization agenda by June 2006. With regard to electricity distribution facilities, it is reported that incorporation of seven distribution regions is completed and the preparations for the incorporation of an additional 13 distribution regions is in progress as of today. At the first stage, 3 distribution regions are planned to be privatized by the end of 2004. It is reported that these 3 regions will be chosen among the ones that has not been party to any dispute and has completed its incorporation process (or is in a position to complete this process without any delay). Furthermore, the PA announced that it is planning to complete the privatization of all electricity distribution companies and regions by the end of 2006. In line with the foregoing the PA has selected Mc Kinsey & Company to carry out the necessary consultancy services for the privatization of TEDAS. This may be interpreted as an indication to show that the PA's intention to privatize TEDAS has been intensified and the tender process might be launched on the expected date.

THY: This Turkish aviation state entity, which has been active in this sector for over 70 years, has 15% market share in the international market and 98,9% in the domestic market as of 2002. The Chairman, Metin Kilci, noted that the privatization process of THY will be carried out as planned by way of public offering. Furthermore, the PA also selected Is Yatirim Menkul Degerler A.S as the outside counsel. Based on these facts and the recent remarks of the PA, it may be expected that the Government would commence to carry out the necessary actions for the privatization of THY in the near future.

ERDEMIR: ERDEMIR, which is one of the most important enterprises in Turkey with approximately 42% market share, has a crude steel and related final products production of respectively 2.38 and 3.13 million tons. Privatization efforts for Erdemir are still continuing. Pursuant to remarks made by the Minister of Finance, Mr Unakitan, the PA is in the phase of hiring consultants to perform the financial and legal consultancy services for the privatization of ERDEMIR. By virtue of these developments, ERDEMIR is expected to be one of the hottest privatizations of next year.

PETKIM: As reported previously, the PA had initiated two tenders for Petro Kimya Holding A.S ("PETKIM"), however, the results were disappointing. The second tender was cancelled as a result of the low bids offered by the bidders. Pursuant to the latest IMF Letter of Intent, the Government seems to be determined to initiate the third tender bid to privatize PETKIM. As indicated in the press release issued by the PA on 20 August 2004, the consultants are selected to carry out the tender process, accordingly, the tender of PETKIM may be expected in the near future.

OTHERS: It is recently reported that the Government plans to privatize Vehicle Inspection Stations, which will need to await approval of the National Assembly for the enactment of the legal framework enabling this project. The tender process is expected to be initiated as soon as possible upon the enactment of the relevant legislation.

Mondaq News Alerts, World, by Selin Özbek and Kemal Aksel, 11 November 2004

Putin Confirms Privatization Results in Russia

The state must guarantee that there will be no renunciation of the results of privatization in Russia, President Vladimir Putin said. "The state must guarantee the finality of the privatization results and all-round protection of private property as a foundation of the market economy," he told a congress of the Russian Union of Industrialists and Entrepreneurs in Moscow on Tuesday. "Officials must protect private property no less vigorously than state property," he said, adding that the state will be guarding the interests of honest businesses. "The investigation of major cases in business, including tax cases, should not be regarded as a signal for seeking a threat to state interests in every newly established company. Fear is unproductive," he said. "However, business should also develop the habit of paying taxes instead of seeking ways of tax-evasion. Taxes are paid to state coffers in the interests of the public, including the interests of the business community itself," Putin said. "The joint efforts of the state and business should not result in compelling the private sector to additional collection and nonproductive expenses," he said. "Unfortunately, such things still happen often, especially in the provinces and localities," Putin said. "Meanwhile, where the market has demonstrated its fruitfulness, the state's interference is not simply unnecessary but sometimes harmful," the president said.

Interfax, Russia, 16 November 2004

The Proposed Social Pact

A last-ditch attempt to reach a social pact fell through on Wednesday when the General Workers Union refused to budge from its position taken against some of the key points of a 22-measure economic plan presented at the Malta Council for Social and Economic Development (MCESD) by chairman Victor Scicluna as a draft social pact. The Malta Independent has obtained a copy of the draft plan and a concise summary of the 22 measures follow. The social pact, according to Mr Scicluna's report, includes a package of measures aimed at enhancing Malta's national competitiveness and upgrading its long-term development in a manner which is sustainable from the economic, social and fiscal points of view. In the preface to his draft plan, which was rejected by the GWU, Mr Scicluna said the social pact aimed to attract investment as well as generate more and better employment opportunities and enhance social welfare and cohesion. He said the tri-partite social pact – signed by government, the unions and the employers – is intended to improve the credibility of economic and social policy in Malta. He proposed that the social pact covers a period of three years – from 1 January 2005 to 31 December 2007.

The implementation of the measures included in the social pact would fall under the scrutiny of the MCESD which, he suggested, should issue reports on a six-monthly basis on progress in the implementation of the measures and the results being achieved. He suggested that the social partners should submit a detailed plan of action regarding their obligations in the implementation of the measures agreed to in the social pact. The plan should be submitted by 31 March 2005. He added that the MCESD should appoint a number of working groups as may be deemed appropriate. Mr Scicluna proposed that the social pact opens the way to further social dialogue regarding areas of economic and social reform not covered by the pact, including the systems for the provision of public health services, pensions and welfare benefits. He said the objectives of the pact would include improving economic competitiveness through a reduction of two per cent in the unit labour cost of production. This is expected to be achieved by stimulating work and economic activity and by implementing an appropriate wages policy. Another objective of the pact is to sustain social cohesion and further improve the social fabric through the development of human capital, which should be reflected in a projected increase in employment of 4,500 full-time jobs. The measures also aim to reduce the annual fiscal deficit to around Lm30 million – 1.5 per cent of the GDP. This should be done in a manner that is conducive to promoting competitiveness, among others.

The 22 measures contained in his draft social pact are divided into four distinct categories: stimulating work and economic activity, the wages policy, the development of human capital and taxation and government expenditure.

Stimulating work and economic activity - In order to stimulate work and economic activity, the draft social pact suggests the following measures:

1. The annual vacation leave entitlement will be reduced by two days in 2005, another two days in 2006 and another three days in 2007. This measure, Mr Scicluna said, is intended to enhance competitiveness of wage levels in Malta through an increase in productivity.

2. The draft plan suggests that that first four hours of overtime per week are to be remunerated at normal rates of pay. This would be subject to a maximum of 100 overtime hours per year which can be remunerated at normal rates of pay. It is also subject to the condition that overtime hours remunerated at normal rates shall, in any week, not exceed one half of the total overtime hours worked.

3. The draft plan suggests that a number of public holidays can be replaced by optional days of vacation leave following consultation with the political parties and other interested entities.

4. The application of tax benefits for part-time workers will be available to either of a married couple in the case of a joint tax computation. This measure, according to Mr Scicluna, is intended to remove a distortion from the income tax system and will serve as an incentive for increased participation in the labour market, especially by women.

5. The government will implement measures to effectively enable the provision of quality childcare. This measure is also expected to increase participation in the labour market, especially by women.

6. The plan suggests that the government implements measures to effectively eliminate abuse of invalidity benefits which would retain older workers in the labour force and reduce the government's expenditure generated by abuse.

7. The plan also suggests an effective reduction of excessive regulations and bureaucracy within the public sector through a formal process whereby new regulations will have to be justified. It also proposed the setting up of a MCESD working group to discuss this issue.

8. The plan also suggests the reallocation of public funds to a scheme involving partnerships between researchers and business.

9. Flexible time schedules within the standard working week in the public sector should be adopted, the plan says. This will apply in entities where this is required for the purpose of national competitiveness.

Wages policy:

10. Starting from 1 January 2006, wage increases in excess of the Cost of Living Adjustment (COLA) are to be in the form of non-cumulative cash payments. The COLA system will, for the duration of the social pact, continue being applied as at present with the adjustment being incorporated in the basic wage.

11. The report suggests that on 1 January 2008, non-cumulative cash payments awarded in 2006 and 2007 will be incorporated, in part or in full, in the basic wages according to the rate of economic growth.

12. The report proposes that the first 50 cents of the weekly cash payments awarded in 2006 and 2007 are to be free of income tax. This will contribute to sustain the disposable income of workers.

13. It suggests that for the purposes of the computation of the pensionable income for people retiring between 2007 and 2009, the non-cumulative cash payments awarded in 2006 and 2007 shall be deemed to form part of the basic wage.

The development of human capital:

14. The report suggests that the system of unemployment benefits shall be transformed into one which effectively leads to participation in the world of work. It is being proposed that unemployed people aged 25 and under shall be requested to undertake placements of six-months duration with firms in the private sector, during which they will benefit from training and work experience. They will not be paid because they will continue receiving unemployment benefit.

15. The report suggests that private sector employers contribute to a fund for the retaining of workers. Private sector employees shall contribute one cent (1c) per employee hour worked towards this fund.

16. It suggests a reform of the system of funding of tertiary education and of the student stipends system based on a formula reflecting costs and tied to agreed criteria.

Taxation of government expenditure

17. The report suggests that the government should provide a commitment not to increase income tax rates and value added tax rates for the duration of the social pact. This should provide a degree of certainty in industrial relations.

18. The government should also extend the existing system of voluntary tax agreements based on benchmarking to all categories of self-employed people. This, according to the MCESD chairman, will introduce more fairness in the tax system between employees and the self-employed.

19. The report suggests that excess government employment should be reduced through private-public partnership arrangements and individual voluntary redeployment. The government is to guarantee jobs for redeployed workers against the eventuality of enterprise dissolution.

20. The increase in expenditure of the government wage bill should not exceed one per cent per year for the duration of the social pact. This is essential for more fiscal consolidation.

21. The report suggests that the government should undertake the reforms necessary to control expenditure in line with the fiscal consolidation targets.

22. Finally, the proposed plan suggests more effective scrutiny of developments in government recurrent and capital expenditure programmes by the MCESD.

The report says that the social partners should begin discussing the new social pact in January 2007 for an agreement applicable as from January 2008. It also suggests that the government should ensure that the Tax Compliance Unit has all the resources at its disposal to guarantee a level of tax compliance that minimises tax evasion.

Malta Independent, Malta, by Matthew Xuereb

Canadian Government Agencies Will Partner to Drive Modernization, According to IDC

IDC believes that Canadian government agencies will increasingly turn towards Public Private Partnerships (PPP) as a modern solution to the social, economic and demographic pressures that challenge the delivery of public services. IDC Canada indicates that federal government projects in the form of PPP will grow from C$1billion in 2004 to more than C$2billion in 2008. Provincial government projects will nearly double between now and 2008, rising to over C$3billion. Municipal government spending will grow fastest, from C$660million in 2004 to almost C$1.8billion in 2008. The forecast is included in a recent IDC Canada study, "How to make public private partnerships successful in the Canadian government sector." The study outlines how government agencies in Canada can successfully leverage these unique partnerships to modernize and ultimately improve the level of service they provide to the Canadian public. "Governments will continue buying basic products in the traditional way, but, as they continue to modernize, agencies will need more compelling tools to carry out long-term strategic transformations," said Massimiliano Claps, senior research analyst at IDC Canada.

Public Private Partnerships are long-term strategic collaborative ventures aimed at supporting the delivery of public services. PPP's have become a widely used tool to overcome the constraints in traditional relationships between governments and suppliers and support the long term modernization of the Canadian public sector. According to IDC Canada, clear definition of each project's objectives, governance and transparency, and selection of partners will be of paramount importance to succeed in PPP. The IDC Canada study, How to make public private partnerships successful in the Canadian government sector (IDC # CA021OGL, October, 2004), describes government experience with Public Private Partnerships and identifies the future growth of PPP by level of government and by type of project. The study also identifies drivers and barriers to growth of PPP and provides valuable insights on how to tackle those barriers.

Tekrati Industry Analyst Report (press release), Canada, 6 November 2004

Council Promotes Sino-African Co-operation

To promote Sino-African investment and trade, the China-Africa Business Council (CABC) was established Wednesday. The CABC is the first public-private partnership between the world's largest developing country and the continent. It was jointly established by the United Nations Development Programme (UNDP), the Chinese Government and the Society for the Promotion of the Guangcai Programme. "The project we are signing here today is a key initiative to help strengthen China-Africa economic links through promotion of Public Private Partnerships," said Khalik Malik, UN resident co-ordinator and UNDP resident representative, at the signing ceremony. Speaking highly of China's role in South-South co-operation, Malik noted that there are challenges for China's businesses looking for accurate information when they conduct trade and investment in Africa.

"The CABC was created to become a new economic mechanism which will help facilitate information sharing and access, thereby deepening Sino-Africa trade and investment," he said. Driven by the private sector with public sector support, the CABC will be set up between China and six African nations -- Cameroon, Ghana, Mozambique, Nigeria, South Africa and Tanzania, officials said. "Political progress has been made between China and Africa within the framework of Sino-Africa Co-operation Forum during the past years," said Wang Yue, director general of China International Centre for Economic and Technical Exchanges (CICETE) under the Ministry of Commerce. "Meanwhile, practical economic co-operation requires co-ordination within enterprise circles from both sides."

Different from other programmes, the CABC will let non-State-owned enterprises play an important role and "no field limitations will be set on the co-operation between the enterprises," Wang said. Trade between China and Africa is growing rapidly. Statistics show that the trading volume between the two soared to US$18 billion last year from US$2 billion in 1999. Officials said that China and Africa are planning to double the 2002 level to reach US$30 billion in the year of 2006. Under the support of the UN and governments, it is crucial for the CABC programme to arouse the zeal and interest of private companies to reduce poverty through investment, said Hu Deping, vice-president of the Guangcai Programme, which has 14,000 non-State-owned companies as members. The CABC programme will officially be launched in January 2005 and last until the end of 2007. "If it turns out that the mechanism works well, the relevant parties involved will certainly seek a further extension," said CICETE Director-General Wang.

China Daily, China, by Jiang Zhuqing, 18 November 2004

Iran, Germany Stress Expansion of Economic Ties

London - The Economy and Finance Minister Wednesday held a meeting with the German ambassador to Iran and underlined the promotion of commercial and economic ties between the two countries. Referring to Iran`s recent agreement with European Union to promote bilateral ties, Seyyed Safdar Hosseini called for the speedy establishment of a joint economic commission between Germany and Iran. The economy minister also said the joint commission is a body which can define both countries` future economic relations. According to IRNA, Hosseini expressed hope over the creation of a new economic relations between the EU and Iran, maintaining "By signing the recent historic accord as well as considering the history of German-Iran cooperation, it is hoped previous good relations be revived once again." Hosseini referred to the new law of foreign investment and said "it helps boost the investment of the two countries` private sectors." Germans, having valuable experience in privatization, can play a great role in transmitting their experience to Iranians in this regard, he added.

The German ambassador to Iran, for his part, said two Iranian deputy Economic Ministers are salted to visit Germany adding "it is a golden opportunity for them to evaluate the prospects of privatization in Germany." Paul Freiherr von Matzhan referred to the delay in the establishment of the joint economic commission, adding "The reason of the delay lies in the prolonged negotiations between German and Iranian officials which will be resumed as before by the meeting between German Foreign Minister and Iranian officials." He expressed confidence on further expansion of German-Iran economic ties in future, maintaining "German federal government is of great importance to Iran with regard to the enhancement of bilateral economic ties." Matzhan further said Iranian government`s efforts pertaining to the parliament`s recent measures on foreign contracts are positive. "The giant Siemens cell phone company is interested in investing in Iran`s mobile phone sector which we hope to launch soon by overcoming the outstanding obstacles," he stated.

IranMania News, Iran, 18 November 2004

Landmark Report Could Influence the Future of Medicines in Europe and the World

Geneva - Gaps in pharmaceutical research and innovation can be closed, says WHO report - The World Health Organization (WHO) today releases a groundbreaking report which recommends ways in which pharmaceutical research and innovation can best address health needs and emerging threats in Europe and the world. Priority Medicines for Europe and the World, commissioned by the Dutch Government as current president of the European Union (EU), identifies a priority list of medicines for Europe and the rest of the world, taking into account Europe's ageing population, the increasing burden of non-communicable illnesses in developing countries and diseases which persist in spite of the availability of effective treatments. The report looks at the gaps in research and innovation for these medicines and provides specific policy recommendations on creating incentives and closing those gaps. At present, pharmaceutical research and development are based on a market-driven incentive system relying primarily on patents and protected pricing as a prime financing mechanism. As a result, a number of health needs are left unaddressed.

The report identifies gaps for diseases for which treatments do not exist, are inadequate or are not reaching patients. Threats to public health such as antibacterial resistance or pandemic influenza, for which present treatments or preventive measures are unlikely to be effective in the future, also require immediate action. "This report identifies health gaps and potential solutions. It is particularly timely for a continent where an ageing population faces increasing health problems, and for a world where old and new threats no longer respect national borders," said Dr. LEE Jong-wook, Director-General of WHO from the Ministerial Summit on Health Research, taking place in Mexico this week. In addition, the report addresses obstacles where effective medicines could be better delivered to the patient. It emphasizes fixed dose combination medicines (medicines which include more than one active ingredient in one pill) as worthy of further research and development. Finally, it looks at particular groups such as children, women and the elderly, who have frequently been neglected in the scientific or medicine development process.

The 17 priority conditions identified by the report are:

- Future public health threats: infections due to antibacterial resistance; pandemic influenza;
- Diseases for which better formulations are required: cardiovascular disease (secondary prevention); diabetes; postpartum haemorrhage, paediatric HIV/AIDS, depression in the elderly and adolescents;
- Diseases for which biomarkers are absent: Alzheimer disease; osteoarthritis;
- Diseases for which basic and applied research is required: cancer; acute stroke;
- Neglected diseases or areas: tuberculosis; malaria and other tropical infectious diseases such as trypanosomiasis, - Diseases for which prevention is particularly effective: chronic obstructive pulmonary disease including smoking cessation; alcohol use disorders: alcoholic liver diseases and alcohol dependency.

The report suggests that Europe can and should play a global leadership role in public health, as reflected by its history of social services provision and social safety nets for all citizens. In many developing countries, the poor are increasingly affected by the chronic diseases that are widespread in Europe, including cardiovascular disease, diabetes, tobacco-related diseases and mental illnesses such as depression. Moreover, the ten countries that joined the EU in 2004 have additional public health challenges. For a number of diseases that affect people in all members of the EU, no effective and safe medicinal treatment is yet available (e.g. Alzheimer disease and several cancers). For some diseases, potentially large markets exist for medicines (e.g. breast cancer) and associated pharmaceutical research is likely to be intensive for certain therapeutic classes. For other categories of medicines, the number of patients is low (e.g. cystic fibrosis) or the market-driven pharmaceutical industry has failed to pursue research and development (e.g., new medicines for tuberculosis).

Innovative solutions - The report suggests that efforts to shorten the medicine development process without compromising patient safety would greatly assist in promoting pharmaceutical innovation. For instance, the EU could create and support a broad research agenda through which the European Agency for Evaluating Medicines (EMEA), national regulatory authorities, scientists, industry and the public would critically review the regulatory requirements within the medicine development process for their relevance, costing, and predictive value. Health authorities are responsible for medicines reimbursement decisions that aim to ensure safe and effective treatment for all patients, while reconciling this with budgetary constraints. Health and reimbursement authorities and manufacturers should agree on general principles for the evaluation of future medicines. For example, the EU Commission and national authorities should support a research agenda on the various methods of rewarding clinical performance and linking prices to national income levels. The report authors believe that these measures will help encourage industry to invest in the discovery of innovative medicines that address priority health care needs.

The report maintains that where the market is strong and the problem is poor understanding of the basic biology of the disease, investment in basic research and in facilitating innovation by the pharmaceutical industry will be needed. Where the biology is well understood but the market is weak, public support for breaching the gap between basic and clinical research — possibly through public-private partnerships and other not-for-profit product development initiatives — will be the preferred solution. Where the biology is not well understood and there is also a weak market, then biological research can be supported while market incentives are created for the pharmaceutical industry, through reducing barriers to innovation and through improving reimbursement rewards.The report points out that major pharmaceutical gaps have been closed in the past. For example, until 1975 the main treatment for severe peptic ulcer - a common ailment - was surgery. Following a long period of focused research in biological mechanisms underlying ulcer disease, effective medical treatments were discovered. These breakthrough discoveries, combined with the discovery that most ulceration was caused by a bacteria treatable with antibiotics, made surgery unnecessary.

The recommendations contained in the report could have a significant impact on research innovation and policy, with support from European leaders. The report will be discussed at a High Level Meeting in the Hague on November 18th 2004.

PhrmaLive.com (press release), Pennsylvania, USA, 19 November 2004

APEC Members Reaffirm Commitment to Bogor Free Trade Goals

Ministers issue joint statement November 17-18: Ministers from the 21 members of the Asia-Pacific Economic Cooperation forum reaffirmed their commitment to achieve the Bogor Goals of free, open trade and investment by 2010/2020. In a joint statement issued during their November 17-18 meeting in Santiago, Chile, the ministers said they "pledged their efforts towards achieving an open trading system aimed at creating new opportunities in a dynamic and interdependent Asia Pacific Region." APEC ministers said they fully endorse the July Package [agreement outlining the framework for talks] adopted by the World Trade Organization's (WTO) General Council, calling it "a breakthrough for the Doha Development Agenda (DDA) negotiations." They also reaffirmed the importance of clarifying, strengthening and improving WTO rules. They stressed the importance of timely agricultural reform, including the abolition of all forms of agricultural subsidies and unjustifiable export prohibitions and restrictions, and called for improved market access for nonagricultural goods. The ministers said they welcome the "substantial progress" made toward maximizing the contribution of Regional Trading Arrangements (RTAs) and Free Trade Agreements (FTAs) to achieve the Bogor Goals, and they noted the need for greater transparency in RTAs and FTAs. To enhance transparency, the ministers approved a new reporting template for Individual Action Plans (IAP) to enable economies to share information on their RTAs and FTAs beginning in 2005.

The ministers also stressed the importance of effective intellectual property rights protection and enforcement regimes, stressing their contribution toward promoting investment, innovation and economic growth. They agreed on the need to build on the APEC Comprehensive Strategy on Intellectual Property Rights in 2005, including reducing piracy, halting trade in counterfeit goods and online piracy, and increasing cooperation and capacity building. The group also denounced corruption as "one of the most serious threats to good governance and the proper development of economic systems in the APEC region," calling for increased transparency and tougher enforcement. The ministers recommended that APEC leaders agree to implement, beginning in 2005, the concrete actions outlined in the "APEC Course of Action on Fighting Corruption and Ensuring Transparency." They also urged APEC member economies to ratify or accede to and fully implement the United Nations' Convention Against Corruption.

APEC members discussed threats to economic progress, such as terrorism and proliferation of weapons of mass destruction. They condemned "in the strongest terms" all acts of terrorism and reiterated the commitment of each APEC member to fight terrorism and secure trade flows. They also urged all APEC members to begin issuing Machine Readable Travel Documents (MRTDs), with biometrics if possible, by 2008. Noting the profound impact that diseases such as HIV/AIDS, SARS, and avian influenza can have on both people and economies, the ministers called for increased commitments to strengthen the public health system and enhance public awareness to help member economies respond to regional health threats. Recognizing that entrepreneurs and small businesses can be "engines for innovation, wealth and employment" among APEC member economies, the ministers urged member economies to establish sound business environments that encourage the creation and growth of enterprises through policies that are consistent with APEC and WTO principles. They also urged APEC to formulate and implement policies that promote the development of businesses owned and/or managed by women.

APEC members include Australia, Brunei Darussalam, Canada, Chile, China, Hong Kong, Indonesia, Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, the Philippines, Russia, Singapore, Chinese Taipei [Taiwan], Thailand, the United States and Vietnam. APEC economies collectively account for 47 percent of world trade and over 60 percent of global gross domestic product. APEC, established in 1989 to strengthen the Asia-Pacific community and enhance economic growth and prosperity, is the only intergovernmental grouping in the world operating on the basis of nonbinding commitments undertaken on a voluntary basis through consensus of its members.

Following is the text of the Sixteenth APEC Ministerial Meeting Joint Statement (Santiago, Chile 17-18 November 2004):

JOINT STATEMENT

Ministers from Australia; Brunei Darussalam; Canada; Chile; the People's Republic of China; Hong Kong, China; Indonesia; Japan; the Republic of Korea; Malaysia; Mexico; New Zealand; Papua New Guinea; Peru; the Republic of the Philippines; the Russian Federation; Singapore; Chinese Taipei; Thailand; the United States of America; and Viet Nam, representing economies which collectively account for 47 percent of world trade and over 60 percent of global GDP, gathered in Santiago, Chile, on 17 - 18 November 2004, in order to participate in the Sixteenth Asia Pacific Economic Cooperation (APEC) Ministerial Meeting. The APEC Secretariat was also present. The Association of Southeast Asian Nations (ASEAN) Secretariat, the Pacific Economic Cooperation Council (PECC) and the Pacific Islands Forum (PIF) attended as observers.

The meeting was chaired by H.E. Ignacio Walker, Minister of Foreign Affairs and Trade of the Republic of Chile.
Ministers met and discussed issues under Chile's main theme, "One Community, Our Future". They agreed that collective responses are essential to meet common challenges facing the APEC Region in fundamental areas like trade, security, transparency, anticorruption, human resource development, health, the knowledge-based economy, and sustainable development. They pledged their efforts towards achieving an open trading system aimed at creating new opportunities in a dynamic and inter-dependent Asia Pacific Region. They reaffirmed their commitment to achieve the Bogor Goals of free and open trade and investment by 2010/2020. APEC Foreign and Trade Ministers appreciated the opportunity to meet in APEC sessions and in meetings on the margins of APEC. Ministers reviewed the key achievements of the APEC 2004 Year hosted by the Republic of Chile and agreed upon initiatives to be undertaken during the APEC 2005 Year, to be hosted by the Republic of Korea.

The key outcomes of the Sixteenth APEC Ministerial Meeting are organized in accordance with the theme "One Community, Our Future" and seven sub-themes of the APEC 2004 Year. Ministers agreed to the following during their deliberations in Santiago:

A COMMITMENT TO DEVELOPMENT THROUGH TRADE AND INVESTMENT

World Trade Organization (WTO) - Ministers reaffirmed their commitment to the improvement of and liberalization within the multilateral trading system. They fully endorsed the July Package adopted by the WTO General Council, recognizing it as a breakthrough for the Doha Development Agenda (DDA) negotiations. In this regard, Ministers highlighted APEC member economies' contribution to reaching the July Package and their commitment to moving forward the DDA negotiations. Ministers stressed that development is at the core of the DDA negotiations and, underlining the importance of achieving a balanced overall outcome, agreed to work together for a successful conclusion to these negotiations. They concurred that such an outcome will strengthen the multilateral trading system and promote economic growth and poverty reduction, particularly amongst developing economies. Ministers reiterated that high levels of ambition and respect for flexibility must be maintained in all areas of the DDA negotiations, in accordance with the mandates approved in Doha. Consequently, Ministers:

- Stressed the importance of agricultural reform, including the abolition of all forms of agricultural export subsidies and unjustifiable export prohibitions and restrictions at an early date, substantial reduction of trade-distorting domestic support, as well as substantial improvements in market access;

- Confirmed the need for substantially improved market access for non-agricultural goods, through the reduction or, as appropriate, elimination of tariff and non-tariff barriers;

- Highlighted the growing importance of services trade and called on all members to submit improved revised offers by May 2005. Members, which have not done so, should table initial offers expeditiously;

- Reaffirmed the importance of the clarification, strengthening and improvement of WTO rules.

Ministers welcomed the launching of negotiations on trade facilitation and agreed to work together to advance these negotiations in the WTO. They agreed that these negotiations should take into account the principle of special and differential treatment for developing and least developed economies. They recognized that trade facilitation plays a critical role in ensuring that the benefits from greater market liberalization are fully reaped. Therefore, the introduction of clearer and transparent multilateral rules on trade facilitation will bring greater certainty, reduce costs and delays, and provide more competitive import and export conditions for industry and business. Ministers agreed that APEC's practical and vast experience in this area could be shared with other WTO members, so as to contribute towards the achievement of positive results. They endorsed the APEC Business Advisory Council's statement that transparency, efficiency, simplification, non-discrimination, procedural fairness, cooperation and capacity building should be core elements of this negotiation. Ministers reaffirmed the importance of effective demand-driven WTO capacity building, and the effective implementation of special and differential treatment in promoting progress in WTO DDA negotiations. This would allow developing Members to fully participate in DDA negotiations. Ministers called on APEC economies to maintain and increase capacity building efforts, particularly in areas where APEC can best add value.

Ministers noted with satisfaction plans to evaluate APEC's past capacity building activities using existing evaluation work by APEC economies and sub-fora, and to improve thereby the effectiveness of future activities. Ministers commended the APEC Seminar on WTO Trade Facilitation held in Bangkok in November and looked forward to the APEC/WTO Roundtable on Trade Facilitation to be held in Geneva in early 2005 and the trade facilitation capacity building in Kuala Lumpur in February 2005. They also welcomed the WTO Capacity Building Group's intention to devote more attention to policy-oriented discussions related to WTO capacity building. Ministers reaffirmed that support for and consultation among APEC economies regarding the DDA negotiations must be maintained and reinforced. In this context, they welcomed the work undertaken by the APEC Geneva Caucus this year, and instructed it to continue its consultations, as well as to improve communication between APEC and Geneva Officials in order to share their experience and contribute to the WTO work program. Ministers committed to convening the APEC Geneva Caucus regularly between now and the WTO's Sixth Ministerial Conference, to be held in Hong Kong, China in December 2005. Ministers welcomed the progress that has been made in the WTO accession negotiations of Viet Nam and the Russian Federation and called for a prompt conclusion of the accession negotiations, including through the provision of capacity building assistance.

Ministers noted that the particular concerns of recently acceded Members to the WTO should be given due consideration in the DDA negotiations. Ministers reaffirmed the need to facilitate access by developing countries to medicines required to address public health problems such as HIV/AIDS, TB, malaria and other epidemics. In this context, they underlined the need for appropriate action, including those pursuant to the consensus reached by the WTO General Council on August 30, 2003 on TRIPS and Public Health. Ministers agreed that at their next meeting, to be held in Korea in mid 2005, they should review progress in the DDA negotiations and provide clear guidance to negotiators regarding the preparations and objectives for the Sixth WTO Ministerial Conference.

Ministers stressed the importance of maintaining momentum in the DDA negotiations.

APEC should continue to provide leadership in this regard. Ministers acknowledged that substantial technical work remains to be done in all areas of the negotiations. They instructed officials to intensify their efforts in this respect so that the anticipated WTO stock-taking in the first part of the year is positive, thus setting the scene for a productive 2005.

Regional Trading Arrangements / Free Trade Agreements

Ministers welcomed the substantial progress that has been achieved to maximize the contribution of RTAs/FTAs to achieving the Bogor Goals, including an APEC policy response, concrete measures to enhance transparency and targeted capacity building. Ministers noted that the need for greater transparency in RTAs/FTAs was an important issue raised by ABAC. Ministers endorsed the "APEC Best Practices for RTAs/FTAs" which are a meaningful reference for APEC members in their RTAs/FTAs negotiations and highlighted their importance as a means to achieve high standard agreements in our region. These Best Practices will help to ensure that RTAs/FTAs contribute to the achievement of the Bogor Goals and are consistent with, and build upon, existing WTO commitments. Ministers recognized that these Best Practices are a timely policy response to the challenges arising from the growing number of RTAs/FTAs, as identified by the business community. Furthermore, they agreed that these Best Practices are a valuable reference for the current negotiations to clarify and improve existing WTO rules, and practices relating to regional trade agreements.

To enhance transparency, Ministers approved a new IAP reporting template to enable economies to share information on their RTAs/FTAs beginning in 2005. They instructed Senior Officials to take the template into account in the context of IAP Peer Reviews and as part of the Mid-term Stocktake. Ministers also welcomed the inclusion of links to official information on APEC economies' RTAs/FTAs on the APEC Secretariat's webpage, and instructed Senior Officials to study the feasibility of developing an APEC RTAs/FTAs database for the use of business, policy makers and other stakeholders. Ministers supported demand-driven capacity building assistance to ensure that all economies can undertake the analytical and negotiating tasks involved in conducting FTA and RTA negotiations, and welcomed the workshops on negotiating free-trade agreements to be held in Viet Nam, Brunei Darussalam and China. Ministers welcomed the results of the Second Policy Dialogue on RTAs/FTAs held in Chile, and endorsed the decision by Senior Officials to hold a Third SOM Policy Dialogue on RTAs/FTAs next year in Korea.

Interaction with the Business Community

Ministers noted with satisfaction that the partnership between APEC Officials and ABAC representatives has increased substantially during 2004. They also took note of ABAC's active engagement in the DDA and expressed appreciation for their continued work to provide views, proposals and recommendations to both Ministers and Senior Officials to help ensure tangible benefits in the pursuit of APEC goals. Ministers commended ABAC's closer relationship with other APEC fora, including through the Second STAR Conference; the Expanded Dialogue on Trade Facilitation; the APEC Customs-Business Dialogue; and the Policy Dialogue on Standards and Conformance.

Ministers expressed appreciation for the 2004 ABAC Report to APEC Economic Leaders.

In particular, Ministers took note of ABAC's proposals to APEC Economic Leaders on a joint scoping study for a Trans Pacific Business Agenda and the examination of the 5 feasibility and the potential scope and features of a Free Trade Agreement of the Asia Pacific. In this regard, they agreed to recommend to Leaders to undertake action toward an enhanced trading environment in the Asia Pacific Region.

Trade and Investment Liberalization and Facilitation

Ministers commended and endorsed the 2004 Committee on Trade and Investment Annual Report on APEC's Trade and Investment Liberalization and Facilitation activities, including the Collective Action Plans developed by CTI sub-fora. Ministers commended the Committee on Trade and Investment's work in advancing trade facilitation and the progress made by members in implementing the Trade Facilitation Action Plan (TFAP). Ministers welcomed the outcomes of the Expanded Dialogue on Trade Facilitation (EDTF) that was held on 1 October 2004, chaired by the ABAC Chair, and that involved the participation of other stakeholders. They endorsed a series of recommendations in three areas (as described in Appendix 1 of the CTI Annual Report to Ministers): deepening and better monitoring the implementation of the Trade Facilitation Action Plan; better interaction with business; and advancing trade facilitation negotiations in the WTO. Ministers asked Senior Officials to report progress on the implementation of these recommendations by the 2005 MRT. Ministers noted a report prepared by an expert on the mid-term review of the TFAP implementation. Ministers were pleased with the review findings which showed APEC economies to be on track towards the objective of achieving 5% reduction in transaction costs by 2006. Ministers directed Senior Officials to intensify efforts to deepen the implementation of the TFAP.

Ministers took note of the various studies dealing with measuring the benefits of actions APEC members take to facilitate trade and reduce transaction costs, including the completion of the Study on the Mutually Supportive Advancement of APEC's Trade Facilitation and Secure Trade Goals post September 11, and the Study on the Assessment of the Effectiveness in implementing APEC Trade Facilitation Actions, which highlighted several areas where APEC could work to build capacity and enhance domestic and international cooperation. Ministers encouraged members to continue to identify suitable methodologies to measure these benefits. In this regard, Ministers welcomed steady progress on Time Release Surveys as one of the proxies for measurement. Ministers recognized the relevance of standards, technical regulations and conformity assessment for trade facilitation, in particular for Small and Medium Enterprises (SMEs), and encouraged member economies to participate actively in the development of standards at the international level, including on product-related environmental standards.
Ministers noted China's initiatives on food safety to promote cooperation among APEC economies in areas such as the application of Hazard Analysis and Critical Control Point principles. We encourage analysis of the food safety activities of relevant international organizations, such as the World Health Organization and the Food and Agriculture Organization of the United Nations, with the aim of determining how APEC, through work in the relevant APEC subfora, might complement the ongoing work of these organizations.

Ministers also endorsed the Transparency Standards on Government Procurement for incorporation into the Leaders Statement to Implement APEC Transparency Standards, thus completing the mandated Leaders' area-Specific Transparency Standards. In this 6 context, Ministers approved a new Transparency IAP template for reporting the Leaders' General Transparency Standards and revisions to the existing IAP templates for reporting the Leaders' area-Specific Transparency Standards for use beginning in 2005. Ministers emphasized the importance of well-targeted and demand-driven capacity building and instructed officials to develop concrete capacity building programs in 2005, which aim to assist member economies to implement the APEC Transparency Standards. Progress in this area should be reflected in relevant Collective Action Plans.
Ministers acknowledged that expeditious implementation of Pathfinder initiatives can invigorate progress towards the Bogor Goals. In this context, Ministers welcomed the adoption of new Guidelines on Pathfinders as approved by Senior Officials and noted that these guidelines will help ensure that pathfinders support the achievement of APEC's Bogor Goals and attract the widest possible participation of APEC's member economies.

Ministers welcomed the increasing participation of member economies in existing Pathfinders including the Advance Passenger Information (API) Pathfinder, with almost half of all economies having implemented or committed to implement an API system in 2005. They also welcomed Australia, Canada and China as new participants in the Pathfinder on the Digital Economy. They welcomed the work of economies in the CTI to update their digital economy templates to report their progress to implement Leaders' objectives on e-commerce, services critical to e-commerce, intellectual property, and tariffs. Ministers also welcomed Russia's support for this initiative as well as its decision to participate in the Pathfinder on the Revised Kyoto Convention on the Simplification and Harmonization of Customs Procedures. In the context of the Pathfinder on Trade and the Digital Economy, and its attachments, Ministers agreed on a list of three IT products (multi-chip integrated circuits, digital multifunctional machines and modems) to forward to the WTO for consideration and possible tariff elimination as part of a balanced outcome of negotiations, including comparable liberalization of other products of interest to economies. Ministers welcomed Mexico's list of IT products for unilateral tariff elimination.

Economies take this action without prejudice to the positions they may adopt in relevant WTO negotiations and accessions.

Ministers stressed the importance of effective intellectual property rights protection and enforcement regimes, and their contribution toward promoting investment, innovation and economic growth. They agreed on the need to build on the APEC Comprehensive Strategy on Intellectual Property Rights in 2005 including to reduce piracy, trade in counterfeit goods and online piracy, and increase cooperation and capacity building. Ministers welcomed the work undertaken under the Pathfinder on Trade and the Digital Economy to survey economies' best practices for combating optical disc piracy and encouraged taking steps to implement the APEC Effective Practices for Regulation Related to Optical Disc Production. Ministers welcomed the progress on the IPR Policy Progress Mapping and the follow-up report on the "Comprehensive Strategy on IPR in APEC" as measures to strengthen business confidence in the region. They also welcomed progress on the establishment of IPR Service Centers and encouraged their establishment in all member economies as soon as practicable.
Ministers encouraged economies to hold training seminars on intellectual property enforcement based on the guidelines set out in the Comprehensive Strategy. In this context, they welcomed China's initiative to host a high-level symposium on IPR in 2005.

e-APEC and the Information Society

Recognizing the importance of the development of effective privacy protections, that avoid barriers to information flows, to continued trade and economic growth in the APEC region, Ministers endorsed the APEC Privacy Framework and the Future Work Agenda on International Implementation of the APEC Privacy Framework. Ministers also endorsed APEC's Strategies and Actions Towards a Cross-Border Paperless Trading Environment and its recommendations. Ministers welcomed the Telecommunications and Information Working Group's (TEL) work on "Progress Towards Adopting and Implementing the WTO Reference Paper on Basic Telecommunications" and "Best Practices for Implementing the WTO Reference Paper", and noted the value of this work in the context of WTO capacity building. Ministers welcomed the report on the implementation of the e-APEC Strategy and instructed Senior Officials to study its findings and report back to the relevant APEC Ministerial meetings in 2005. Ministers noted the significant improvements in einfrastructure through, for example, the benefits of increased competition and marketoriented policies. Ministers acknowledged that building skills and capacity in optimizing information technology is the most pressing need for APEC economies to reduce the digital divide and to facilitate trade. In this context, they welcomed the progress that has been made by the APEC Digital Opportunity Center (ADOC).

Ministers restated their commitment to the Brunei Goals on tripling internet access by the end of 2005.

Ministers welcomed the report of the 2nd APEC High-Level Symposium on e-Government held in Mexico in October 2004 and the convening of the APEC E-commerce Fair and the First APEC E-commerce Business Alliance Forum held in China in June 2004.
Ministers recognized the importance of the second phase of the World Summit on the Information Society (WSIS), to be held in Tunisia in November of 2005, for continuous development of the global information society, and instructed Senior Officials, through the TEL, and other relevant fora, to formulate APEC's input to the WSIS.

Industry Dialogues

Ministers acknowledged the work carried out this year by the Chemical Dialogue and its steering group in APEC. Ministers encouraged additional capacity building efforts for the implementation of the United Nations Globally Harmonized System of Classification and Labeling (GHS). While noting that standards and regulations can effectively address environmental objectives, Ministers expressed concern over the growing number of EU product-related environmental regulations, including the EU's proposed chemical regulations (REACH) because of the adverse implications of this complex regulatory system for industry. Ministers encouraged APEC economies to work together to ensure that the views of their respective stakeholders will be duly considered by the EU in the development of its regulations. Ministers welcomed the results of the Sixth Automotive Dialogue hosted by the People's Republic of China and looked forward to the Seventh Dialogue to be hosted by the Philippines. Ministers noted the work to date undertaken by the Chemical and Automotive Dialogues on non-tariff measures and encouraged these groups to continue this work with a view to contributing to the DDA. They encouraged other fora to use the Automotive and Chemical Dialogues as models for promoting harmonization of standards, transparency, trade facilitation, and the identification of non-tariff measures. Ministers welcomed the establishment of the new APEC Dialogue on Non-Ferrous Metals and endorsed convening its first full-fledged meeting in May 2005.

Life Sciences Innovation

Ministers commended the outcomes of the Second APEC Life Sciences Innovation Forum (LSIF) held in Malaysia in September 2004. They endorsed the Strategic Plan for Promoting Life Sciences Innovation which aims to help APEC economies reach their full potential in researching, developing and marketing effective diagnostics, medical devices and modern and traditional medicines, and to promote cooperation in developing effective health services. They noted that implementation of the basic principles of the strategic plan should contribute to improving health, and achieving social and economic goals related to life sciences innovation in the region, contributing to a more coordinated approach to identifying and addressing health treatment priorities. Ministers welcomed the APEC LSIF's participation in the Global Cooperation Group of the International Conference on Harmonization.

Individual and Collective Action Plans

Ministers reaffirmed their commitment to achieve the Bogor Goals through actions outlined in their respective Individual Action Plans (IAPs). They endorsed the 2004 IAPs and welcomed the measures undertaken by individual economies to liberalize and facilitate trade. Ministers welcomed the successful conclusion of the 2004 IAP Peer Reviews of Chile, China, Peru, Singapore, Chinese Taipei and the United States. Ministers reaffirmed their commitment to complete all twenty-one IAP peer reviews by the First Senior Officials' Meeting (SOM I) in 2005 in order to support preparations for the mid-term stocktake [evaluation] to be conducted in 2005 on overall progress towards meeting the Bogor goals. Ministers welcomed the progress made on the implementation of Collective Action Plans (CAPs) and instructed Senior Officials to keep reviewing and progressively improving the CAPs to ensure that they produce tangible benefits to the business community and meet the Bogor Goals. They noted that these actions will also contribute to the mid-term stocktake process next year.

Structural Reform

Recognizing that structural reform improves the functioning of markets so as to enhance living standards and realize the economic potential of the APEC region in a sustainable way, Ministers stressed the importance of promoting structural reform as a priority within the APEC agenda. Ministers welcomed the work undertaken by Senior Officials in responding to Leaders´ instructions to review the implementation of the Structural Reform Action Plan. In this context, they applauded the success of the APEC High Level Conference on Structural Reform held in Tokyo in September 2004, which provided positive momentum by identifying future steps to implement the APEC Structural Reform Action Plan. Ministers also welcomed the achievements made in the area of strengthening economic legal infrastructure (SELI), capacity building and business outreach projects on competition policy, corporate governance and debt collection regimes. They also acknowledged progress on the SELI reporting mechanism, submitted voluntarily by member economies. Ministers approved the "Leaders' Agenda to Implement Structural Reform" (LAISR) for adoption by Leaders as further clear guidance to promote structural reform in APEC in the following possible priority areas: regulatory reform, strengthening economic legal infrastructure, competition policy, corporate governance and public sector management, in 2005 and beyond. Ministers instructed Senior Officials to continue working, in close consultation with Finance Ministers, to identify an effective institutional mechanism to address structural reform in APEC.

Anti-Corruption and Transparency

Ministers recognized that corruption is one of the most serious threats to good governance and the proper development of economic systems in the APEC region, and globally. Ministers agreed that APEC's commitment and leadership to prevent and combat corruption, including through ensuring transparency, is indispensable in strengthening the integrity of enforcement and the core foundations of our collective values in society, in particular in the areas of economic development, growth, and prosperity. Ministers commended the success of the APEC Anti-Corruption Experts Meeting, held during SOM III in Santiago. They approved, for endorsement by Leaders, its recommendations for the "Santiago Commitment to Fight Corruption and Ensure Transparency" and an "APEC Course of Action on Fighting Corruption and Ensuring Transparency" (COA). Further, they recommended that Leaders agree to the implementation, beginning in 2005, of the concrete actions outlined in the COA, including that APEC economies: take all appropriate steps, consistent with their different status, towards ratification of, or accession to, and implementation of the United Nations Convention Against Corruption (UNCAC); strengthen effective measures to prevent and fight corruption and ensure transparency; deny safe haven to officials and individuals guilty of public corruption, those who corrupt them, and their assets; fight both public and private sector corruption; promote public-private partnerships; nurture cooperation to combat corruption in the region; and implement, in accordance with the fundamental principles of each economy's legal system, the concrete actions contained under the item "From Santiago to Seoul". Ministers endorsed the experts' recommendation to establish an Experts' Task Force in 2005 on implementation of such commitments, and instructed Senior Officials to develop its terms of reference by the first Senior Officials' Meeting (SOMI) in 2005. Ministers also welcomed the experts' recommendation for effective and results-oriented synergies and partnerships with other multilateral and regional organizations, particularly on donor coordination on training, capacity building and exchanges of technical expertise.

Economic and Technical Cooperation and Capacity Building

Ministers welcomed the 2004 Senior Officials' Report on Economic and Technical Cooperation and endorsed its recommendations, in particular that working groups be assessed to ensure that they are responsive to APEC's current work priorities and contribute to the achievement of the Bogor Goals. Ministers approved a new Quality Assessment Framework, which will replace the ECOTECH Weightings Matrix, as a tool to foster good quality project proposals and an efficient allocation of APEC resources. They recognized that strengthening assessment, monitoring and evaluation of APEC's ECOTECH activities has the potential to help attract external resources, such as from International Financial Institutions as well as from the private sector. Ministers noted that APEC's growing work program is generating greater demand on its capacity-building resources. Accordingly, they instructed officials to consider ways to broaden APEC's funding base, and endorsed the establishment of an APEC Support Fund, which could attract funds from government as well as non-government sources. Ministers recognized that English and other languages constitute critical operational tools for SMEs, micro enterprises, youth and women. They welcomed the results achieved to date by ABAC and other APEC Fora to foster capacities in language skills and looked forward to consolidating and developing specific actions aimed at achieving the full potential of this communication tool and promoting entrepreneurship, mutual understanding and increased opportunities in a digitalized region. Ministers instructed Senior Officials, through the SOM Committee on ECOTECH, to oversee the work to be developed by the Education Network from the Human Resources Development Working Group, so as to establish a Strategic Action Plan for English and other Languages in the APEC Region, with the support of all relevant fora, aimed at creating competitive human capital, and to report progress in 2005.

Given the importance of expanding APEC's relationships with International Financial Institutions (IFIs), the private sector, and other relevant international organizations, Ministers welcomed the collaboration between the APEC Secretariat and the World Bank's Global Development Learning Network (GDLN). They looked forward to concrete outcomes from the Second APEC/IFIs Roundtable Dialogue on ECOTECH to be held in Korea in 2005, focusing on the areas of SMEs and education, and called for close consultation with the Finance Ministers process. In the context of social safety nets and workforce retraining, Ministers commended the initiatives undertaken in APEC, aimed to empower vulnerable people, ensuring more equitable distribution of the benefits brought about by globalization. In this regard, they welcomed the outcomes of two meetings this year on these issues, co-hosted respectively by Thailand and Korea and the People's Republic of China and Korea. Ministers welcomed Korea's offer to hold a symposium in 2005, with a view to making the results of the Social Safety Nets - Capacity Building Network's (SSN-CBN) research projects widely known. Ministers instructed Senior Officials to redouble their efforts on strengthening social safety nets and workforce retraining programs through the Human Resources Development Working Group (HRDWG) and the SSN-CBN. In this context, they noted the launching of a pilot project entitled "Workforce Retraining through Digital English Instruction Media".

Ministers noted the importance of capacity building activities addressing the social dimension of globalization, with regards to the poverty alleviation aspects of micro, small and medium size enterprises. Ministers acknowledged the Science and Technology Ministerial Meeting's emphasis on the importance of interlinking activities of governments, researchers, entrepreneurs, and investors to ensure that each economy gains the maximum benefit from science, technology, and innovation. Ministers urged further initiatives aimed at bringing together policy makers and the scientific community, to promote cooperation under the knowledge-based economies priority of fostering innovation, as discussed at the APEC Workshop on Development of Science and Technology Intermediary Mechanism hosted by China and Thailand in Beijing in February 2004.

SHARING BENEFITS THROUGH BETTER PRACTICES: ENHANCING HUMAN SECURITY Counter-Terrorism and Secure Trade

Ministers reaffirmed that terrorism is a threat to human security, stability and growth in the region and the imperative need to combat terrorism - in all its forms and manifestations - in accordance with the purposes and principles of the Charter of the United Nations and international law, in particular humanitarian and human rights law, and bearing in mind United Nations Security Council anti terrororism resolutions, including Resolution 1566 (2004). They valued APEC's on-going work to confront effectively the risks posed by transnational terrorism and to strengthen capacity building and technical assistance efforts in order to meet collectively the challenges posed by this threat. Ministers condemned, in the strongest terms, all acts of terrorism, including the most recent barbarous acts in Russia and Indonesia, and expressed their condolences to their peoples and governments. Ministers reiterated the commitment of each APEC member economy to fight terrorism and secure trade flows, and that these efforts should complement APEC's core business of trade and investment liberalization and facilitation and economic and technical cooperation. While noting work by relevant APEC fora on the economic impacts of terrorism, Ministers also noted the concerns flagged by the business community on the additional costs generated by security-related measures. Ministers therefore underscored the need to secure trade while removing obstacles to trade and minimizing costs on businesses.

Ministers continued their work to take action to eliminate the danger of proliferation of weapons of mass destruction and their means of delivery. They noted the important contribution of informal consultations in building consensus on these issues. They identified key elements of effective export control systems, and committed to continue work in APEC to unite economies and the private sector to facilitate the flow of goods to legitimate end users while preventing illicit trafficking in weapons of mass destruction, their delivery systems and related items. They established guidelines on the control of Man- Portable Air Defense Systems (MANPADS), and economies committed to work individually to develop measures consistent with these guidelines and, as appropriate, with efforts taken at the United Nations, its agencies and other relevant international organizations, to prevent terrorists from obtaining and using these weapons to attack civilian aviation. Ministers also recognized that all APEC economies are implementing, have concluded, or aim to conclude an Additional Protocol with the International Atomic Energy Agency by the end of 2005, reflecting their determination not to allow illicit nuclear activities in our region through their collective commitment to expanded transparency on nuclear-related activities. Ministers noted the progress made by the Counter-terrorism Task Force (CTTF) in implementing the 2003 APEC Leader's Human Security commitments, especially those aimed at facilitating secure and efficient trade within the region, such as the implementation of the International Ship and Port Facility Security Code (ISPS Code). Endorsing the agreements reached within the CTTF, Ministers:

- Recognized the need for cooperation among member economies on the supervision of imported and exported food in order to prevent and better respond to possible bio-terrorist attacks, including attacks through toxic or hazardous material in food supplies;

- Called for increased commitments, including efforts through the Health Task Force (HTF), on strengthening the public health system and enhancing public awareness to help member economies respond to regional health threats;

- Called for cooperation to ensure that all APEC economies will begin issuing Machine Readable Travel Documents (MRTDs), if possible with biometrics, by 2008, and, on a best endeavours basis, to accelerate replacement of Non-MRTDs by MRTDS as well as implement ICAO travel document security standards;

- Agreed to continue to implement existing business mobility initiatives, and welcomed efforts to implement the Advance Passenger Information (API) system and the cooperative program of Immigration Liaison Officer in the region. Ministers noted the completion of a feasibility study for an automated Regional Movement Alert List (RMAL) System as an important counter-terrorism initiative. They agreed to pilot the RMAL in 2005 and agreed to work on an enhanced version of the Customs Asia-Pacific Enforcement Reporting System (CAPERS) to address legal issues.

Ministers welcomed Senior Officials' decision to extend the mandate of the CTTF until the end of 2006. They welcomed the Philippines and Chile as CTTF Chair and Vice Chair, respectively, for the next two years. Ministers committed their efforts to advance the ongoing work in adopting all necessary steps to control the cross-border movement of dual use equipment and materials, as well as people and financial resources, involved in terrorist activities while, at the same time, enhancing the free flow of legitimate travellers, trade and investment. Ministers reaffirmed the willingness of all economies to cooperate -where appropriate and in accordance with APEC practices- with international organizations with common goals, such as the International Civil Aviation Organization (ICAO), the International Maritime Organization (IMO), the World Customs Organization (WCO), the Counter-Terrorism Action Group (CTAG) and the International Labour Organization (ILO) so as to develop concrete, result-oriented actions to neutralise threats to the security of our economies.

Ministers noted the Transportation Ministers' statement to focus on implementing an intermodal supply chain security initiative in the next two years and to continue implementation of maritime and aviation security measures, consistent with international law, with emphasis on the implementation of the International Ship and Port Facility Security Code (ISPS Code) and working to support international efforts, including those by multilateral agencies, to control access to MANPADS and other potential threats to civil aviation. Ministers welcomed on-going technical and capacity building efforts to implement thorough baggage inspection for air and maritime passengers. Ministers welcomed the Finance Ministers' statement to support actions to combat terrorism, including through increased compliance with accepted international standards to counter money laundering and terrorist financing, and fostering closer cooperation through the exchange of financial intelligence among financial intelligence units and customs. Meanwhile, Ministers urged the Financial Action Task Force to make progress, as appropriate, in the enlargement of its membership. Ministers looked forward to an enhanced capability in the region to develop and implement regional counter terrorism capacity building initiatives as a result of the establishing the Asian Development Bank's Cooperation Fund for Regional Trade and Financial Security Initiative (FRTFSI).

Ministers welcomed the outcomes of the Second Secure Trade in the APEC Region (STAR) Conference Chile in March 2004 and looked forward to the Third STAR Conference, to be held in Korea in March 2005. They valued the capacity building and best practices sharing work that member economies, along with representatives from the private sector, are able to achieve through this on-going APEC initiative. Ministers took note of work undertaken by the Telecommunications and Information Working Group (TEL) regarding Cyber Security and Cyber Crime within the scope of securing telecommunications through the exchange of experiences and good practices. They agreed to strengthen their respective economies' ability to combat cybercrime by enacting domestic legislation consistent with the provisions of international legal instruments, including the Convention on Cybercrime (2001) and relevant United Nations General Assembly Resolutions; increasing cooperation among economies' Computer Emergency Response Teams (CERTs), law enforcement, and the public and private sectors; training SMEs in network security; and increasing law enforcement capacitybuilding.

Health Security

Ministers recognized that outbreaks of infectious diseases, such as SARS in 2003 and avian influenza in 2004, have a profound impact on both the peoples and the economies of the region. They encouraged continued vigilance and preparedness so as to detect, respond to, and mitigate the impact on the economy of public health threats. Ministers welcomed the efforts of the HTF in enhancing preparedness and planning for pandemic influenza, and activities underway and planned at the Regional Emerging Disease Intervention Center. Ministers encouraged the HTF to enhance cross-sector cooperation with other relevant APEC fora in order to address avian influenza and to strengthen, in coordination with APEC members, the work on research and development of relevant vaccines and antiviral drugs. They underscored the importance of using information technology to better face threats to health in the region and, in this context, welcomed the HTF's project on e-Health Initiative. Ministers instructed Senior Officials, through the HTF, as well as other relevant fora, to include appropriate actions in the area of Health Security in their work plans, ensuring that such actions complement, without duplicating, work being conducted in other international fora.

Ministers noted with concern the economic and social impact that HIV/AIDS continues to have in the APEC region, and approved the initiative "Fighting against AIDS in APEC" for endorsement by Leaders, with the aim of encouraging greater cooperation in the region to prevent HIV/AIDS and promote access to safe and affordable medicines and treatment for people living with AIDS. Ministers welcomed the outcomes of the XV International AIDS Conference held in Bangkok in July 2004. They underlined the need for APEC to work with relevant international organizations, such as UNAIDS, WHO and the Global Fund to fight AIDS, Tuberculosis and Malaria, in accordance with APEC practices, so as to collectively support actions to address the spread of HIV/AIDS in the region. They appreciated the leading role of Thailand and others on this issue. Ministers looked forward to the active participation of APEC economies in the next International AIDS Conference, which will be held in Canada in August 2006. Ministers also noted the international effort to eradicate polio by 2005 through the WHO/UNICEF-led global Polio Eradication Initiative. They stressed the importance of all economies making efforts to close the financial gap that faces this effort.

Energy Security

Ministers noted the impact of current high oil prices on the economies of APEC and emphasized that access to adequate, reliable and affordable energy is fundamental to achieving the region's economic, social and environmental objectives.
Ministers acknowledged the achievements of the APEC Energy Security Initiative and supported the outcomes of the APEC Energy Ministers' meeting in June this year, including their call for adequate supply to help stabilize the oil market, and efforts to enhance energy security by preparing for energy supply disruptions, facilitating energy investment, using energy more efficiently, expanding energy choices and capitalising on technological innovation. They also noted the outcomes of the APEC Meeting of Ministers Responsible for Trade in June calling for closer cooperation between Energy Ministers and Trade Ministers. In this context, they instructed Senior Officials to work with the Energy Working Group to examine the impact of high energy prices on trade and economic activity in the region. Further, Ministers endorse the "Comprehensive Action Initiative recognizing the need for strengthening the APEC Energy Security Initiative - energy security, sustainable development and common prosperity" (CAIRNS Initiative), which aims to improve data transparency, energy emergency responses, energy investment, energy efficiency, the development of renewable and alternative energy, and to promote energy for sustainable development and poverty reduction.

Invasive Alien Species

Ministers noted the difficulty and cost of dealing with problems caused by Invasive Alien Species (IAS). Ministers agreed that APEC should identify opportunities for cooperation and capacity building to detect, monitor, and manage invasive pests in the Asia-Pacific region, using science-based criteria in accordance with international standards. Ministers also agreed that a shared awareness and understanding of the risks that invasive marine pests pose to regional growth and sustainability is urgently needed, along with coordinated regional action to help prevent their spread. Ministers welcomed the progress on the development of the Regional Management Framework for Control and Prevention of Introduced Marine Pests by the Marine Resources Conservation Working Group. They noted that IAS problems cut across sectors and, therefore, called on Senior Officials to instruct relevant APEC fora to work together to evaluate how APEC can best contribute on this matter and to report the results in 2005. In this context, Ministers welcomed the APEC Symposium to prevent the spread of the Golden Apple Snail held in Chinese Taipei in September 2004 and the APEC Workshop on Introduced Marine Pests held in Chile in May 2004.

GROWTH AND STABILITY: KEYS FOR APEC INTEGRATION

Ministers welcomed the outcomes of the APEC Finance Ministers' Meeting, and supported its conclusions, in particular with regard to the importance of disciplined and sustainable fiscal policies for their contribution to long-term growth and macroeconomic stability; the need for policies and institutions that lead to sustainable, broad-based and equitable growth in the region; and the contribution that financial integration can make to growth and economic development. However, Ministers also recognized that freer capital flows can heighten vulnerabilities, especially in emerging market economies, increasing the importance of sound economic policies, strong institutions, and appropriately sequenced liberalization.

Macroeconomic Issues

Ministers endorsed the Economic Committee's Report for 2004; the 2004 APEC Economic Outlook; the KBE/New Economy project titled "Realizing Innovation and Human Capital Potential in APEC"; and the TILF project titled "Trade Facilitation and Trade Liberalization:From Shanghai to Bogor". Ministers welcomed the 2004 APEC Economic Outlook, particularly its structural chapter on FTAs/RTAs. Ministers instructed the Economic Committee to further contribute to the understanding of FTAs and RTAs issues in the Asia-Pacific region as a catalyst for achieving the Bogor goals and advancing the WTO process. They also welcomed the initiative on "Realizing Innovation and Human Capital Potential in APEC", recognizing that these factors are two key drivers of growth in the new global economy. Ministers acknowledged the importance of the TILF project titled "Trade Facilitation and Trade Liberalization: From Shanghai to Bogor" that attempted to provide methodology to implement the Shanghai Accord. Ministers further instructed the Economic Committee to continue to work on TILF related and KBE/New Economy studies that will help to achieve the Bogor Goals. Given the importance of the issue of terrorism and its direct impact on an economy's welfare, Ministers welcomed the Economic Committee's efforts to undertake a research project on this topic noting that the structural theme of the 2005 APEC Economic Outlook will be the Economic Impact of Counter-Terrorism in the APEC Region. Ministers commended the Economic Committee's efforts to provide an analytical basis for increasing the economic benefits arising from structural reforms. Ministers agreed on the need to make the agenda of the Economic Committee more policy and action oriented in consultation with other APEC fora and Finance Ministers' process while maintaining its analytical functions.

SKILLS FOR THE COMING CHALLENGES

Ministers welcomed the outcomes of the Third APEC Education Ministerial Meeting (AEMM), with its theme of "Skills for the Coming Challenges". Ministers appreciated its emphasis on improving the learning of English and other foreign languages at the school level as well as among workers and small business entrepreneurs and the use of technology for teaching and learning. Ministers also commended EDNET for organizing a summit of researchers and policy-makers in Beijing in January 2004 in preparation for the Third AEMM. Ministers expressed their appreciation to the APEC Education Foundation (AEF) for its initiatives in advancing cyber education and ICT capacity building of small and microenterprises. Ministers also recognized the Foundation's potential as a useful vehicle to enhance APEC education and human capacity building cooperation, and encouraged member economies, business, academia and other stakeholders to strengthen partnerships and cooperation with the AEF.

Ministers supported the outcomes of the Fourth APEC Science Ministers' meeting, with its theme "Enhancing the capacity of science, technology & innovation to deliver sustainable growth across the APEC region". They welcomed the mandate given to the Industrial Science and Technology Working Group to progress a range of important activities on human capacity building (in conjunction with the Human Resources Development Working Group) connecting research and innovation, international science and technology networks and technological cooperation. Ministers acknowledged the importance of promoting science and technology cooperation and noted that improved education and training in math, science and technology is of critical importance in order to ensure the long-term economic growth of APEC economies, and to support global efforts to address significant sustainability issues. Ministers welcomed the work of the HRDWG to prepare people for the new skills required in the 21st century. These efforts include promoting improved curricula, teaching methods, policy and transparent governance methods for quality basic education, lifelong learning, and training and retraining opportunities to improve the quality of the labor force. Ministers welcomed the concept of an APEC Business Schools´ Network (ABSN) proposed by ABAC, which aims to build partnerships among regional tertiary training institutions, so as to encourage academic and educational exchanges; develop common standards; share resources and identify best practices. They encouraged economies to nominate business schools in the region to be part of ABSN.

OPPORTUNITIES FOR ENTREPRENEURIAL GROWTH

Small and Medium Enterprises

Ministers emphasized that Small and Medium Enterprises (SMEs) and Micro-Enterprises (MEs) are engines for innovation, wealth and employment among APEC economies and urged member economies to establish sound business environments that encourage the creation and growth of enterprises through policies that are consistent with APEC and WTO principles.
Ministers welcomed the "Santiago Agenda on Entrepreneurship" adopted at the Eleventh APEC Ministerial Meeting on SMEs, which identified best entrepreneurial practices and reinforced the need for their implementation. Ministers considered SMEs to be a cross-cutting issue for APEC and welcomed the dialogues held with other relevant fora and the initiatives of economies to host events aimed at improving dialogue with SMEs. They encouraged the SMEWG to continue to improve its role in coordinating APEC's work to promote the growth and competitiveness of SMEs and to further promote the APEC SME Coordination Framework. Ministers welcomed the SME Ministers' commitment to enhance regional support to advance the business environment of MEs and their commitment to strengthen the role of MEs in the APEC region, through the advancement of the micro-enterprise Development Action Plan as an integral part of the SME WG's Micro-enterprises Subgroup. Likewise, Ministers encouraged an open dialogue with regional International Financial Institutions (IFIs), in coordination with the SOM Committee on ECOTECH, to advance joint initiatives that specifically benefit MEs, including through microfinance.

Gender

Ministers noted that APEC needs to formulate and implement policies that promote the development of women-owned and- managed SMEs and MEs, including business development and export support services that target women's enterprises in the region. They recognized the need for women-specific programs to develop technical and digital skills, as well as to strengthen women's business development at all levels, and welcomed the recommendation to support the APEC project "Initiative for APEC Women's Participation in the Digital Economy". Ministers noted the important role of the Gender Focal Point Network for the implementation of the Framework for the Integration of Women in APEC. They recognized the need to reinforce and promote gender integration in APEC through studies, research and collaborative projects among APEC fora aimed at strengthening the participation of women in trade within the region. They welcomed the continued participation of the Women Leaders Network (WLN) in the APEC process and commended its commitment towards the advancement of women and gender issues throughout APEC, including through establishment of a gender advisory group within each economy's coordinating mechanism. Ministers commended the valuable contribution of the CTI project "Supporting Potential Women Exporters" in identifying how APEC's trade liberalization and facilitation agenda can be inclusive of gender considerations. They looked forward to follow-up activities by CTI and other APEC fora that will increase trade and advance gender equality. Ministers asked Senior Officials to report on follow-up to the project's recommendations by the 2005 MRT.

Youth

Ministers welcomed the 2004 APEC International Youth Camp held in Chinese Taipei in August 2004. Ministers recognized the commitment of the participants to work towards an innovative and entrepreneurial society. They also recognized the need to enhance youth entrepreneurship through special education, and the creation of programs to facilitate the start up and operation of youth-owned and managed businesses. Ministers encouraged more APEC youth activities so as to build mutual understanding and cooperation in the region. Ministers welcomed Korea's proposal to organize the 2005 International Youth Camp.

COMMITMENT TO SUSTAINABLE GROWTH

Sustainable Development

Ministers recognized the need to revitalize APEC's agenda on sustainable development and welcomed the work undertaken by various APEC fora on this issue. They recognized that these initiatives have shed light upon the relationship between economic, environmental and social issues from the widest range of perspectives and that they have contributed to a better understanding of what sustainable development implies for the APEC region.
Ministers highlighted the cross-cutting character of this theme and welcomed the work achieved this year in the First Meeting of APEC Ministers Responsible for Mining; SME Ministerial Meeting; the Third APEC Tourism Ministerial Meeting; and the Fourth APEC Ministers Meeting on Regional Science and Technology Cooperation. Ministers welcomed the recommendations on sustainable development, including the need for more cooperation with other international fora, and instructed the SOM Committee on ECOTECH (ESC) to take these into consideration in coordinating and developing future work in this area. Ministers looked forward to the results of a study on sustainable development that will be undertaken by SOM, as well as the preparations for an APEC High-Level Meeting on Sustainable Development in 2005-2006.
Noting the conclusions of the APEC workshop on environmental impact analysis of trade liberalization measures, and other activities undertaken this year, Ministers emphasized the value of environmental impact analysis as a means both to increase understanding of the implications of trade liberalization measures, and to strengthen public support for trade liberalization by reducing uncertainty.

Agricultural Biotechnology

Ministers welcomed the 2004-2006 Work Plan of the APEC High Level Policy Dialogue on Agricultural Biotechnology and acknowledged its importance in realizing the benefits of agricultural biotechnology through increased agricultural productivity, improved food security, and protection of environmental resources. Ministers instructed Senior Officials to continue the Policy Dialogue to advance discussions in the areas of policy and information exchange, intellectual property rights and technology transfer, economic and human resource investment, and agricultural biotechnology public policy development. In this regard, Ministers welcomed the convening of a 4th APEC High Level Policy Dialogue on Agricultural Biotechnology in the margins of SOM I in Korea in 2005.

EXPERIENCING OUR DIVERSITY

Ministers welcomed the "Patagonia Declaration on Tourism in the APEC Region" and noted the achievements reached during the four years of the Tourism Charter. Ministers underscored the importance of tourism to the well-being of the region. In addition to being a significant employer through many micro, small and medium enterprises, tourism is a key vehicle for promoting mutual understanding and respect for our natural resources. Ministers acknowledged that the work on each policy goal of the Tourism Charter is underpinned by the importance of strengthening cultural, environmental and economic sustainability. They recognized that member economies must continue to work in partnership with other APEC fora and the private sector to address these issues. Ministers instructed Senior Officials to continue to explore ways to broaden opportunities to experience diversity among member economies in areas beyond tourism such as cultural diversity.

FROM SANTIAGO TO BUSAN: PENDING TASKS APEC

Reform
Ministers welcomed the package of reforms agreed by Senior Officials for immediate implementation. They noted that these reforms contribute towards making APEC more focused and policy-oriented, ensuring that APEC's work responds directly to the instructions of Ministers and Leaders, streamlining meeting arrangements and other processes, improving coordination between fora, and improving dialogue with the business community and other stakeholders, including labour representatives.
Ministers also welcomed the efforts of individual fora to evaluate and reform their own processes under the leadership of Senior Officials. Ministers instructed Senior Officials that reform should be a continuous process to ensure APEC retains its accountability and the flexibility to respond to a rapidly changing environment and to the needs of all APEC's stakeholders. In this context, they welcomed the agreement by Senior Officials to work further next year on the additional issues identified during 2004 and to explore new areas for possible institutional reform. Ministers welcomed decisions by Senior Officials to address immediate and emerging funding issues related to APEC operation Ministers instructed Senior Officials to give high priority to developing a sustainable financial strategy for APEC and its Secretariat. This strategy should take into consideration the annual instructions of Leaders, Ministers and Senior Officials; improvements in efficiency of the assessment, monitoring and evaluation of projects; improvements in efficiencies on savings and management of the Secretariat; the possibility of new and additional funding sources; and an analysis of the affordable level of contributions from Member economies.

Mid-Term Stocktake
Ministers commended Senior Officials for their work on the preparation for the Mid-term Stocktake of overall progress towards the Bogor Goals, and endorsed the recommendation on the work program. Ministers instructed Senior Officials to provide a preliminary progress report to the APEC Meeting of Ministers Responsible for Trade in 2005 and bring the final results of the Mid-term Stocktake to the 17th APEC Ministerial Meeting so that Ministers may report to Leaders on the final outcomes. They underscored that the result should comprise an assessment of APEC's progress towards the Bogor Goals based on members' evaluation, IAP Peer Reviews process, inputs from fora, and stakeholders such as ABAC, the APEC Study Center Consortium, PECC, and include Senior Officials' policy recommendations for future activities that need to be taken to achieve the Bogor Goals.

Approval of SOM Report - Ministers approved the SOM Report, including the decision points therein, in particular, the proposed APEC budget and the assessment of members' contributions for 2005.

APEC Secretariat - Ministers noted with satisfaction the Report of the Executive Director of the APEC Secretariat and commended the Secretariat for its efforts throughout the year.

APEC 2005 - Ministers thanked the Republic of Korea for its briefing on preparations for the 17th AMM and the 13th APEC Economic Leaders' Meeting in 2005 and Viet Nam for its presentation on the preparations for the 2006 APEC year.

Future Meetings - Ministers noted that future APEC Ministerial Meetings will be held in Viet Nam in 2006, Australia in 2007, Peru in 2008 and Singapore in 2009.

Scoop.co.nz (press release), New Zealand, 21 November 2004

World Bank to Pump Sh6b in Railways Privatisation

The World Bank will spend $77 million (Sh6 billion) to prepare Kenya and Uganda's railways corporations for a privatisation programme scheduled to begin next year. In a wide-ranging pledge to the East Africa Community, the multilateral lender said it plans to spend $28 million (about Sh2.2 billion) on staff layoffs at the Kenya Railways Corporation and the Uganda Railways Corporation. According to the project, to be approved by the bank's board in July next year, the Bretton Woods institution will finance technical assistance and cross-border railway improvement to the tune of $6 million. Kenya Railways and Uganda Railways will then be handed over to private operators on a concessioning basis. The process is already underway in all the three EAC countries, although in different stages. The funding is a major boost, especially for Kenya Railways, which is reeling under a Sh20 billion debt owed to various financial institutions. "IDA (International Development Association) and EU (European Union operations already support the process in Tanzania and Uganda, and similar support needs to be provided for Kenya," says the World Bank.

The support for the Kenyan operation is the most critical of all, the bank says, as "the potential for the shift of traffic from road to rail and consequent benefit to the Kenyan and the regional economy would be the highest in the case of a joint concession." Kenya Railways has lined up 2,000 employees for retrenchment in a programme that is estimated to cost Sh3.12 billion, leaving it with a leaner staff of 6,200. Uganda Railways, too, is expected to cut back its staff numbers. The Kenya Railways management however denied that it planned to retrench workers, saying only those who will be employed by the concessionaire will be paid their terminal dues. "The concessionaire will take some staff," said Ms Judith Odhiambo, KR’s public relations manager. "They will be cleared to start on a new slate and the remaining workers will be absorbed by Kenya Railways." "Only freight traffic and passenger traffic operations will be concessioned, and remaining employees will be deployed to other sections," she said in an interview, adding that the process would culminate in the handing over of the concessioned operations in December 2005. The concessionaire for the 25-year period for freight traffic in both KR and UR and a seven-year period for Kenya Railways passenger traffic, all valued at Sh2.8 billion, will be known in July next year, the month the World Bank’s board is expected to give its nod to the funding.

Two committees mandated to oversee the process are revising the Kenya Railways Act of 1978 to ensure that the corporation does not cease to exist after privatisation. And it seems KR will have to go private even before the Privatisation Bill, which is currently pending before Parliament, is passed. "The government," said the public relations manager, "will not pull out completely from the corporation. It will monitor and even subsidise operations. Private operators are driven by profits and if they are left alone, commuters might have to pay through the nose." The World Bank pledge, made last week, coincided with the naming of five firms shortlisted for the concessioning, which attracted nine bidders. Those fully pre-qualified include NLPI Private Limited of Mauritius, CANAC Inc of Canada, Maersk Kenya Limited, RITES Limited of India and China Railway First Group of China. UK-based Magadi Soda Company and Sheltanm Trade Close Corporation of South Africa have been conditionally pre-qualified.

Concessioning of the two railway firms is seen as the only effective way to ensure efficiency, especially at the Kenya Railways, which has for years survived on cash injections from the public purse. Managing Director Andrew Wanyandeh says a concessioned Kenya Railways will generate Sh16 billion a year from 2009, an amount which is expected to increase to Sh25 billion annually after 25 years as a result of increased efficiency and a wider regional market. The concessionaire will be a consortium consisting of 40 per cent local (Kenya and Uganda) shareholding. Kenya Railways has a debt of Sh20 billion which should be paid before concessioning. It owes commercial banks Sh4 billion, while the government has borrowed Sh16 million on its behalf. "We are hoping that the government will give us the funds to pay the debt," said Odhiambo. The World Bank has also offered Kenya Railways $5 million (Sh400 million) to compensate encroachers who will be displaced from their land during the restructuring of its infrastructure. Another $1 million (Sh80 million) will be used to support the Kenya Asset Holding Authority. Transport-related consultancy will consume $2 million (Sh160 million) of WB’s funds, while $35 million (Sh2.8 billion) has been set aside to cushion the corporations and the private concessionaire against attendant risks, including, among others, health, environmental degradation and safety.

East African Standard, Kenya, by Luke Mulunda, 20 November 2004