presentation session 5 colombia's general system of royalty payments
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Mr Javier Villareal, Main Advisor for Royalties Affairs, National Planning Department of Colombia during the Second Meeting of the Policy Dialogue on Natural Resource-based Development, held on 3-4 June 2014 at OECD Headquarters in Paris.TRANSCRIPT
National Planning Department www.dnp.gov.co
Colombian General Royalties System Opportunities and Challenges Behind the Reform
Javier Antonio Villarreal
Paris. June 3rd, 2014
School- Tumaco
Colombia is the 3rd economy in Latin America
Decentralized country
32 departments, 1.102
municipalities, 13 Metropolitan
areas
Between 2009 and 2013 GDP
average growth was 4,1%
Nevertheless regional GDP
disparities need policies to
reduce inequity.
While Bogota’s participation in
national GDP is 24%, Vichada’s
participation is 1%.
Source: SGR and DNP, 2013
Increasing gaps
17 % of population had
80% of resources
Funds were focused on 8
departments
Earmarked use: health,
education, water and
sanitation
Before 2011 After 2011
100% of population allocated
with resources
Savings and investment funds
Serves all departments
10% of Royalties go to Science,
Technology and Innovation Fund
(U$ 484 million per year)
Non earmarked use of funds
Colombia’s Royalties System
A Territorial Inclusive Policy for Development
SGR is System that democratizes the use of
royalties
Equity
• Wealth that arises from natural resources belongs to all Colombians
Regional impact
• The system created regions, aiming to provide incentives for regional impact project design and implementation, in order to promote development and competitiveness in the country
Transparency and more efficient use of resources
• More coordination between national and local governments, and within regions
• Improve public investment planning and resource execution
Savings
• For periods when royalties income is lower
• To make public expenditure sustainable
• To honor obligations on pensions at the regional level
1
2
3
4
Funds Within the SGR
SGR
1,3% SGR Operation 0,7% Monitoring, control and evaluation system of royalties 0,5% Special condition’s municipalities
2% Oil fields oversight and mapping
10%
20%
10%
34,5%
6,6%
9,9%
16,5% 9% 60%
10 %
20%
10%
6,6 %
MUNICIPAL
OCAD
TS
Defines the project to be funded by SGR
Assess, evaluates, prioritises and approves
investment projects submitted by
governments (depending on whether it´s
National, Departmental, Municipal or ST&I)
Decides the execution of the projects
If a project is rejected by the OCAD the
Entity (National, Municipal, Departmental,
ST&I) does not lose the royalty funds, but is
able to design a new one.
DEPARTMENTAL REGIONAL SCIENCE TECHNOLOGY &
INNOVATION
Multilevel Governance Within SGR:
OCAD
*TS: Technical Secretariat - *OCAD: Spanish acronyms for a Collegiate Board for Administration and Decision
Ongoing Projects
2640
Completed Projects
774
Capacity-building resources 2013
($US thousands)
$ 106
$ 66
$ 66
$ 26
$ 23
$ 21
$ 18
$ 15
$ 12
$ - $ 50 $ 100 $ 150
ST OCAD regionalesDepartamentos
Corporaciones autónomasMunicipios cat. 6Municipios cat. 5Municipios cat. 4Municipios cat. 3Municipios cat. 2Municipios cat. 1
More than $353K US have been allocated to sub-national
governments’ capacity building strategy
% projects approved in
OCAD
Direct. Tranf [PORCENTA
JE]
Esp. RCF
40%
RCF [PORCENTA
JE]
RDF [PORCENT
AJE]
ST&I [PORCENT
AJE]
Municipalities Cat.1
Municipalities Cat. 2
Municipalities Cat. 3
Municipalities Cat. 4
Municipalities Cat. 5
Municipalities Cat.6
CAR
Departments
Regions
Municipalities and departments have
strengthened their planning capacity
Transport
$1.8 US Billion
1.594 projects
The SGR invests in different sectors
Science, Technology
and Innovation $0.8 US Billion
204 projects
Education
$0.8 US Billion
568 projects
Environment
$0.2 US Billion
180 projects
Housing
$0.7 US Billion
716 projects
Health
$0.2 US Billion
206 projects
Agriculture
$0.4 US Billion
638 projects
Data report and follow up
online SUIFP
Monitoring system
GESPROY
Citizen’s follow up
tools MapaRegalías
www.maparegalias.sgr.gov.co
www.sgr.gov.co
Reports for
national,
departmental
and municipal
scale
$ 2
9 U
S
milli
on
Transparency tools are the core of the System
Challenges
1. Closing territorial gaps
2. Institutional strengthening
3. Multilevel governance through OCAD
4. ST&I for competitiveness
5. From a project based system to a
programme-based system
6. Transparency as a cross cutting
strategy to the system
All departments have access to
royalties funds
Specialized teams working hand in
hand with departments and
municipalities to develop projects:
capacity building
ST&I fund counting on the
participation of academia and private
sector
5 multiregional projects
Surveillance, follow up and
accountability systems
How is Colombia facing these
challenges?
The SGR is addressing key challenges
in Colombia
Tel. (+57 1) 3815000
Cra 10 N°10 – 55 Piso 19
Bogotá - Colombia
Javier Villarreal Villaquirán
www.dnp.gov.co
Thank you