waipa world bank pilot executive training on · pdf filewaipa world bank pilot executive...

WAIPA World Bank Pilot Executive Training on FDI WB0117720717

2 www.waipa.org

Contents Background and rationale ............................................................................................................... 3

Course description and objectives .................................................................................................. 3

Structure and content ..................................................................................................................... 4

Assessment ..................................................................................................................................... 4

Testimonials .................................................................................................................................... 4

Further collaboration ...................................................................................................................... 5

Annex 1 Agenda .............................................................................................................................. 6

Annex 2 Evaluation ....................................................................................................................... 13

Annex 3 Participants ..................................................................................................................... 14

Annex 4 Participants distribution ................................................................................................. 16


3 www.waipa.org

Background and rationale

Productive private sector investment is an important component of developing countries’ competitiveness and growth strategies. Attracting foreign direct investment (FDI) helps to link a country’s domestic economy to global value chains in key sectors, create quality jobs, increase exports, develop supply chains, and transfer technologies and business practices. These potential benefits require clear FDI policies and promotion strategies, as well as effective implementation that responds to the realities and aspirations of a country.

Countries also increasingly need to define their value proposition as an attractive investment location and to proactivity market investment opportunities to investors in sectors and sub-sectors with comparative advantages relative to competing locations. This is particularly important for countries with little track record of attracting FDI or a reputation as difficult places to invest.1

For this reason, the World Bank Group and WAIPA partnered to bring an Executive training targeting high-level executives dealing with FDI at investment promotion agencies (IPAs) and policymaking bodies.

The course took a participatory approach ensuring exchange of information and sharing of experience of guest speakers, lecturers and participants. Brief lectures presented latest research, toolkits and real-life experience of the World Bank Group in supporting Governments and IPAs around the world in the pursuit of investment agendas.

Lecturers and guest speakers included specialists from the World Bank Group, WAIPA, as well as from selected National Investment Promotion Agencies e.g. Business France and the Board of Investment Mauritius and the business sector, e.g. Banco Sabadell and CISCO Turkey.

Course description and objectives

At the end of the course the participants were intended to have:

• Learnt about the latest trends and best practices in investment policy and promotion, as well as links with Government’s broader development agendas (i.e. economic diversification, job creation);

• Improved their capacities to design and implement effective policies and efforts aimed at attracting, establishing, retaining and expanding FDI, as well as linking it better to domestic economies;

1 Trade and Competitiveness Global Practice, World Bank Group


4 www.waipa.org

• Gained knowledge of cutting edge solutions and tools, such as for the design and administration of effective investment incentives and investment retention and expansion,

• Familiarized with effective strategies to maximize the positive spillovers of FDI for domestic economies.

Structure and content

The 4-day full training program explored all areas of the investment life-cycle, starting with attracting and establishing FDI, proceeding with its retention and expansion, and concluding with linkages to domestic economies.

Assessment

The feedback of the course was very positive, see Annex 2. From the collected questionnaires

(while 5 was excellent and 1 was poor) nine out of ten questions scored equal or higher than 4.5

included the questions on the coordination of the training (4.6), the content (4.6), the resource

persons (4.6), administrative support (4.8) as well as the interest to participate in a WAIPA World

Bank Certification course (4.6), the question on the preliminary understanding of the participants

whether the content will be useful for their daily work scored 4.6 and the satisfaction of the

overall training also 4.6. Merely the question on the willingness to pay tuition fee for a future

training scored below 4,5 viz. 3,9; while still 60% gave the highest or the second highest option

to this question.

Furthermore, the diverse array of participation (delegates from nine of WAIPAs Steering

Committee regions, see Annex 4) can be considered as very positive.

Testimonials

• Excellent content. Thank you for a great program and a very well-organized seminar! Véronique LEDRU, International Co-operation Department, Business France

• I am going back to Bulgaria with great ideas from this training and I will do whatever is necessary to implement them to make my country a better destination for investments. Stamen YANEV, Managing Director, InvestBulgaria Agency


5 www.waipa.org

• Congratulations! Useful, good idea and good execution. Mustafa RUMELI, Head of Dept. for Coop. with Development Agencies, Invest in Turkey (ISPAT)

• Well organized program, informative and practical. Vera CHIU, Research and Information Division, Macao Trade and Investment Promotion Institute (IPIM)

• I am lucky to benefit from this training as it provided me with tools and benchmarks with my colleagues. It helped me to gather experiences to fast-track our development and to develop a strategy to capture more FDI in Burkina Faso. Honoré KIETYETA, Director of Investment Promotion, API-Burkina Faso

• We congratulate you on organizing this professional, practical, and necessary training. We highly appreciate the professional presentation, which was transmitted with practical experiences. Arber MUHAXERI, Director of the Private Sector Promotion Directory, Kosovo Investment and Enterprise Support Agency (KIESA)

Further collaboration

The World Bank, as Consultative Member of WAIPA, will prominently work together with WAIPA

in our regional conference and the World Investment Conference 2017 in November in Dubai,

UAE. Apart from this the further collaboration regarding both capacity building and research is

envisaged. Capacity building in the sense of a training collaboration with the World Bank for

having basic training for the IPAs but also a launch our diploma/certificate program to keep

investment promotion officers updated as investment is an ever-changing subject. The key role

of WAIPA is to convene, to serve as a networking, as a gatherer of IPAs in the world to help them

connect the dots. On the other hand, the role of research to comprehend what works and what

might not work in the fields of social media, incentives and both inward and outward

investments.


6 www.waipa.org

Annex 1 Agenda

AGENDA

Investment Policy and Promotion

Training Workshop, 17-20 July, 2017

Istanbul, Turkey

Day 1

Time Session

9:00 - 9:30

Welcome and Introduction.

• Bostjan Skalar, WAIPA

• Roberto Echandi, WBG

• Participant introductions

9:30 – 10:45

Connecting the Dots: the evolution of FDI, its role in development, international investment agreements and the current debate on globalization. Attracting, promoting and retaining foreign investment is a complicated matter–especially for a developing economy. Evidence shows a compelling case for FDI: foreign investors can create jobs, bring capital and technologies, create knowledge spillovers, help local companies integrate with GVCs and drive economic growth in general. But these potential benefits are not automatic and far from guaranteed. This session will be devoted to exploring:

• How FDI potential benefits go beyond capital

• Why firms internationalize

• The economic impact of FDI on growth and development, trade, employment and capabilities

• The different types of FDI and how they impact development

• The new patters and modalities of foreign investment and its relationship with trade

Session coordinator: Roberto Echandi, WBG

10:45 – 11:00 Coffee Break

11:00 – 12:30

Introduction to International Investment Agreements (IIAs).

Investment Promotion practitioners must know about the historical origins, political economy and key legal instruments regulating international investment. This session will be devoted to exploring:

• The core elements and guarantees included in international investment agreements (IIAs)

• Key issues related to the determination of the scope of application and investment protection provisions in international investment agreements


7 www.waipa.org

• The complexities in the negotiation and application of both relative and absolute standards of protection and treatment, as well as the issues related to the definition of the subjects who can benefit from those standards according to international investment agreements and recent case-law


12:30 - 14:00

Lunch

14:00 - 15:30

Facilitating Investor Entry: entry barriers and how to identify and address them. Many developing countries limit the entry of FDI into certain sectors, including services sectors, or maintain complex work permit and visa systems that inhibit movement of skilled labor. The underlying policy objective for such measures is often understandable, such as to protect national strategic interests, to protect SMEs from competition, or to “reserve” certain types of occupations for nationals. The challenge often surfaces when these policies become a barrier to FDI and longer-term economic development objectives of FDI host countries. The session will discuss:

• The different types of barriers to FDI in services and the trade-offs of such measures

• The relationship between FDI in services and policy objectives of boosting manufacturing and know-how transfer to domestic economies

• Tools and examples of policies and reform options in this space that can merge both, short-term political and long-term economic development objectives


15:30 - 15:45

Coffee Break

15:45 -17:00

Making Investors Stay in the Long Term: investment protection and expansion. Retaining and growing investment in the host country is as critical as attracting new investment. However, countries’ ability to retain investment can be negatively impacted by political risk, which among others includes: instances of unlawful expropriation, breach of contract, arbitrary or non-transparent Government conduct. The latest data shows a clear link between political risk and FDI. For example, more than a quarter of investors investing in developing countries and economies in transition cancelled planned investment expansions or withdrew their investment altogether due to political risk. This session will discuss:

• How public agencies’ behavior can generate risk of investment loss and what governments can do in order to tackle this challenge

• The relationship between investment retention and expansion and international investment agreements


8 www.waipa.org

• The practical mechanisms and tools available to governments to make their interaction with investors more coherent

• How to measure the success of reforms

• Examples of countries that have managed to establish successful mechanisms to address investor grievances before they escalate into full-blown disputes


Day 2

Time Session

9:00 - 10:30

Locational Investment Incentives: do they work? Investment incentives are used pervasively by governments across both the developed and developing world. While locational incentives play a prevalent role in governments’ policy mix to attract investment, behavioral incentives aim to encourage certain investor behaviors, such as hiring local staff, investing in innovation, or using local suppliers to establish backward linkages. The key question for governments is always to what extent, and under which circumstances, incentives actually influence investors’ decisions and how they can reach these policy objectives. The session will discuss:

• How various locational incentives function in different country contexts

• The tools available for governments in making incentive policy decisions

• How to promote improvements in transparency, administration and cost efficiency of incentives

• How to measure the effectiveness of incentive reforms Session coordinator: Jana Krajcovicova, WBG

10:30 – 10:45

Coffee Break

10:45 – 12:30

Investment Promotion Fundamentals. Investment promotion nowadays is highly competitive. Many developing countries face significant challenges in attracting, establishing, retaining, and expanding FDI, or linking it with domestic investment, despite having achieved significant reforms. This is partly due to a lack of visibility of the location vis-a-vis investors, information asymmetries, and coordination failures. Investment Promotion that effectively deals with these issues lays on 3 pillars: strategic, institutional, and service. This session will:

• Discuss the importance of three fundamental pillars of investment promotion: strategy, institutions and services

• Hear directly from an investor in the region on what issues they face when making investment decisions and what they would appreciate from the IPAs


9 www.waipa.org

Session coordinator: Armando Heilbron, WBG

12:30 – 14:00 Lunch

14:00 – 15:30

Defining an Investment Promotion Strategy. IPAs should not go about promoting generically all sectors to all types and sources of investment. IPAs must align their efforts with the national development strategy and goals (such as diversification, higher GVC integration, technology transfer, job creation, etc.), and make decisions about how to utilize their scarce resources efficiently and effectively to achieve those goals. This requires a strong understanding of the locations’ value proposition to investors, having a clear, strategic focus on sectors and even segments and activities of interest to both location and investors, identifying target markets and investors, and laying out a plan to provide the relevant services to them. This session will discuss:

• Strategic alignment of IPA activities with broader national objectives

• The strategic focus for countries looking to attract investment

• The different policies and IPA strategies being used by countries to achieve economic diversification and the production of higher value added goods and services

• The Sector scan tool, which helps governments select, qualify and promote the sectors that have the potential to attract strategic investment while serving the country’s diversification objectives


15:30 – 15:45 Coffee break

15:45 – 17:00

Strengthening Investment Promotion Agencies. Public institutions dedicated to the attraction of FDI and the full extraction of its benefits do so, in part, by mitigating two types of market and government failures: information asymmetries and coordination failures. These lead to suboptimal allocation of capital, when an investor chooses a suboptimal investment location because the optimal location was not known or adequately understood. An established investor may forgo the use of local inputs, labor, and business partnerships, for the same reasons. It is therefore crucial that locations adopt a strong institutional framework, and that a specialized IPA be optimally designed, set up, staffed and managed for success. This session will discuss:

• Key characteristics for a strong IPA (or IPA function) o Foundations: mandates, budgets and funding, and governance o Operations: structure, systems, staff, partnerships, M&E

• Establishing collaboration mechanisms for promotion Session coordinator: Armando Heilbron, WBG


10 www.waipa.org

Day 3

Time Session

9:00 - 10:30

Delivering Quality Investor Services. Governments that have been most successful at attracting investment have typically been characterized by offering outstanding services to investors. These services follow the investment project’s lifecycle, from attraction to entry and establishment, to operations, to expansion and linkages and spillovers. These services are crucial and their absence may result in the investors not considering the country at all, dropping out during exploration or establishment phases, exiting too early or operating with no positive effects on the national economy. IPAs help convert potential investors into existing ones and keep the latter when they provide inquiring and established investors with needed information and assistance, when they use research and salesmanship to identify and proactively approach the investors most likely to be attracted by the locations’ value propositions, and when they proactively draw investor attention to mutually beneficial opportunities presented by linkages to domestic businesses and workers. This session will discuss:

• The 4x4 matrix of investor services

• Programs that package services for a country to offer investors at different stages and consistent with the strategy


10:30 – 10:45

Coffee Break

10:45 – 12:30

Developing Investor Aftercare. Existing investors are typically one of the biggest sources of new investment (“reinvestment”), however, they may not find a conducive environment to expand or, even worse, may run into difficulties that may lead them to divest from a given location. Encouraging existing investors to not only remain in the country but to also expand and diversify their operations requires proactively reaching out to them. Similar to targeting, aftercare must focus on the most strategic investors in pre-selected sectors and segments. This session will cover:

• Leveraging strategic established investors to maximize investment and its benefits

• Establishing an aftercare program to generated reinvestment opportunities


12:30 – 14:00 Lunch


11 www.waipa.org

14:00 – 15:30

Promoting Linkages between FDI and the Local Economy. To maximize the benefits of FDI, investment climate reforms and targeted investment policy interventions need to be geared towards creating linkages between MNEs and domestic firms, maximizing technology and knowledge transfer and increasing domestic value added (DVA). However, a range of market failures and constraints faced by investors, local businesses and host governments shape FDI patterns and their linkages potential across and within countries, business sectors and value chains. Within this context, this session aims answers the following:

• What are the key do’s and don’ts of a successful linkages policy?

• How can investors find and connect with the right local suppliers?

• How can governments improve the capacity of local suppliers to comply with foreign investors demands for their inputs?

• What are successful examples in practice?

• How can agencies measure success in this space?

Session coordinator: Ulla Heher, WBG

15:30 – 15:45

Coffee Break

15:45 – 17:00

Using FDI to Achieve Policy Objectives: The Case of FDI-led Economic Diversification. International investment can serve as a vehicle for economic diversification. However, some countries attract large quantities of foreign investment and never move up the value chain. In order to attract the most desirable type of FDI, countries must determine an appropriate mix of investment policies that reflect both their socio-economic objectives and comparative advantage. This session will focus on:

• Common economic, and political challenges evolving from an economy based on natural resources towards a model based on exports of new goods and services

• Practical, successful experiences of economic diversification

• How to use the Investment Reform Map (IRM), a tool designed to assist reform champions in host countries in setting a joint investment vision, agreeing on a set of reform priorities and mobilizing key agencies around the implementation of specific actions towards diversifying the economy.

Session coordinator: Ivan Nimac, WBG

Day 4

Time Session

09:00 – 12:30 Case study: FDI-Led Approaches to Economic Diversification and Linkages


12 www.waipa.org

On the final day of the training, participants will test knowledge by solving a case study on the topic of economic diversification. This will be a highly interactive half day session, where the WBG team will immerse participants into a situation that they regularly face in client projects. Through a series of judgement call questions, participants will have the opportunity to think through complex issues and suggest solutions. The experts will act as guides for the thinking process, helping participants to learn to think like experts, while balancing considerations, and making the connections. Key learning objectives of the case study:

• To apply diagnostic tools to identify reforms required to improve prospects of a client country being able to diversify by leveraging incoming FDI

• To identify the parts of the investment climate where government policy can impact upon investment competitiveness

• To identify the policy, legal, administrative and institutional entry points of such interventions

• To understand the weight of political economy of such interventions and the discussions that are posed by governments in the process

• To discuss the measures available to develop better linkages between the domestic economy and incoming FDI in order to maximize the benefits for the local economy

Session coordinator: Ivan Nimac, WBG

12:30 – 14:00

Lunch

14:00-15:00

Wrap up and Concluding Remarks.

• Bostjan Skalar, WAIPA

• Ivan Nimac, WBG


13 www.waipa.org

Annex 2 Evaluation

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

5.00

Before participatingdid you have enough

information tounderstand whether

the content of thetraining will be usefulfor your daily work?

How appropriatewere the training's

contents?

How would you judgethe resource persons'

contribution

Were the materialsused during the

activity informative?

Would you say thatthe coordination ofthe activity was well

organized?

WB0117720717 - Pilot Executive Training on FDIEvaluation Question 1-5

aver. % 4 & 5

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

5.00

Would you say thatthe administrative

support/secretariatwas efficient?

Would youparticipate in another

WAIPA World BankTraining?

Would you be willingto pay for a WAIPA

World Bank Training?

Would you beintersted in a WAIPA

World BankCerticifate Program?

Are you satisfied withthe overall quality of

the activity?

WB0117720717 - Pilot Executive Training on FDIEvaluation Question 6-10

aver. % 4 & 5


14 www.waipa.org

Annex 3 Participants

Babayev, Jafar AZPROMO Presidential Advisor on Investment

Promotion Azerbaijan

Kumar Paul, Ajit Bangladesh Board of

Investment (BIDA) Executive Member Bangladesh

Bazuchi, Karina Apex Brasil Investment Executive Brazil

Yanev, Stamen InvestBulgaria Executive Director Bulgaria

Kietyeta, Honore API-BF Director of Promotion and Marketing Burkina

Faso

Levy, Nuno Cabo Verde TradeInvest Executive Board Member Cabo Verde

Gárate Tüysüzoglu, Özge ProChile Commercial Director Chile

Cano, Catalina Gonzalez ACI Medellin Knowledge Management

Professional Colombia

Monroy Hernandez,

Marcela ProColombia Executive Representative Colombia

Ledru, Veronique Business France Mission Cooperation Internationale France

Goncu, Emine JETRO Foreign Trade Specialist Japan

Muhaxeri, Arber KIESA Director of the Private Sector

Promotions Directory Kosovo

Chiu, Vera Macao Trade and

Investment Promotion

Institute

Research and Information Division Macao

Gatt, Anthony David Malta Enterprise Investment Promotion Advisor Malta

Ramsohok, Dr.

Sonalisingh

Board of Investment

Mauritius Investment Executive Mauritius

Abascal, Jorge Alberto

Cruz ProMexico Director Ist. Mexico

Albareda, Fernando Peru Trade Office Commercial Attaché Peru

Skocir, Matej SPIRIT Head of International Promotion Slovenia

Naicker, Leighanne The dTi Assistant Director South

Africa

Mehmet Onur Partal Istanbul Development

Agency/Invest in Istanbul Senior Expert Turkey

Rumeli, Mustafa ISPAT Head of Dept. for Coop. with

Development Agencies Turkey


15 www.waipa.org

Kassem, Mohamad Hadi Invest in Sharjah R&D Manager UAE

Alp, Sebnem Banco Sabadell Deputy Representative Business

Balbin, Vicente Banco Sabadell Director Office Istanbul Business

Kivilcim, Cenk Cisco Turkey General Manager Business

Sobhani, Shaba UNDP Senior Private Sector Advisor UN

Hussein, Dr. Hashim UNIDO Head ITPO Bahrain UN

Klos, Nadia Whiteshield Partners Senior Associate Consultant

O’Sullivan, Anthony Whiteshield Partners Director Consultant

Ersahin, Ismail WAIPA Deputy CEO WAIPA

Hora, Andreas WAIPA Research Coordinator WAIPA

Skalar, Bostjan WAIPA CEO WAIPA

Echandi, Roberto World Bank Global Lead World Bank

Heher, Ulla World Bank Private Sector Development

Specialist World Bank

Heilbron, Armando World Bank Senior Investment Policy Officer World Bank

Krajcovicova, Jana World Bank Investment Policy Officer World Bank

Nimac, Ivan World Bank Head World Bank


16 www.waipa.org

Annex 4 Participants distribution

1. AZPROMO Azerbaijan

2. Bangladesh Board of Investment (BIDA) Bangladesh

3. Apex Brazil Brazil

4. InvestBulgaria Bulgaria

5. API-BF Burkina Faso

6. Cabo Verde TradeInvest Cabo Verde

7. ProChile Chile

8. ACI Medellin Colombia

9. ProColombia Colombia

10. Business France France

11. JETRO Japan

12. KIESA Kosovo

13. Macao Trade and Investment Promotion Institute Macao

14. Malta Enterprise Malta

15. Board of Investment Mauritius Mauritius

16. ProMexico Mexico

17. Peru Trade Office Peru

18. SPIRIT Slovenia

19. The dTi South Africa

20. Istanbul Development Agency/Invest in Istanbul Turkey

21. ISPAT Turkey

22. Invest in Sharjah UAE

Country List2:

1. South America: 5

2. Eastern Europe: 5

3. Sub-Saharan Africa: 3

4. Europe/EU: 3

5. East Asia and South-East Asia: 2

6. Central Asia: 1

7. MENA: 1

8. South Asia: 1

9. North America: 1

Other participants included UNDP, UNIDO, Whiteshield Partners, Banco Sabadell & Cisco Turkey

2 According to WAIPA Steering Committee

waipa world bank pilot executive training on · pdf filewaipa world bank pilot executive...

Documents