29 October 2015

Cook Islands private sector assessment published

PSDI has published its first private sector assessment for the Cook Islands. 

Cook Islands: Stronger Investment Climate for Sustainable Growth, was launched at Rarotonga at the Pacific region's Forum Economic and Trade Ministers Meeting. It was launched by Cook Islands Minister of Finance Mark Brown and Regional Director of ADB's Pacific Liaison and Coordination Office Andrea Iffland.

The report examines challenges the country faces in realizing its economic potential and offers recommendations that will support private sector-led growth.

Cook Islands Minister of Finance Mark Brown with ADB
Pacific Liaison and Coordination Office Regional Director
Andrea Iffland.
“While the Cook Islands is one of the best performing Pacific economies, it needs continued economic growth to improve social programs and to adjust to emigration challenges,” said Andrea. “The reforms recommended in this private sector assessment will build on the solid economic foundations in place here and make it easier to do business and easier for businesses to grow.” 

The report identifies policy actions that should be prioritized and provides strategic recommendations that will help improve the business environment. Areas where it calls for improvements to be made include policy transparency, public sector performance, business entry processes, land market issues, improving access to finance, promoting more gender equality, upgrading infrastructure services, improving the efficiency of state-owned enterprises, and developing a framework for competition.

The report says reforms in these areas will grow the economy and help the Government of the Cook Islands achieve its goal of sustainable development through private-sector-led growth.

The report is the fourth of five private sector assessments (PSAs) PSDI will produce this year. The PSAs focus on the institutional and policy reforms needed to remove constraints to broad-based private sector growth.

Download the report.  

Previous PSDI private sector assessments

16 October 2015

PSDI publishes private sector assessment for Samoa

PSDI's Samoa private sector assessment, Reform Renewed, has been launched in Apia. 

The report looks at constraints to investment and entrepreneurship. It recommends reforms that will benefit the private sector by improving productivity, through which it projects a return for Samoa to sustained high rates of economic growth. 

“ADB, through its Pacific Private Sector Development Initiative in particular, has recently partnered with the Government of Samoa on a number of reforms, including secured transactions, electronic registries, business law reform, competition and consumer protection, and state-owned enterprises,” said Andrea Iffland, Regional Director of ADB’s Pacific Liaison and Coordination Office in Sydney. “The insights and recommendations in this private sector assessment offer ways these achievements can be built on to increase Samoa’s prosperity and economic wellbeing.” 

PSDI Lead Economist Paul Holden, Deputy Prime Minister
Fonotoe Nuafesili Pierre Lauofo, and CEO of the Ministry of
Commerce, Industry and Labour Peseta Margaret Malua.
Reform Renewed was launched by Samoa's Deputy Prime Minister Fonotoe Nuafesili Pierre Lauofo at the Ministry of Commerce, Industry and Labour. He was joined by PSDI Lead Economist Paul Holden, who discussed the key recommendations of the report. 

The report recommends the government prioritize six areas: completion of secured transaction reforms; passing the new competition and consumer act; privatizing five state-owned enterprises; returning the Unit Trust of Sawhomoa to its original mandate; reviewing regulations around foreign investment, business licensing and employment; and pursuing contracting out and public-private partnerships. These reforms will promote private sector development and limit the role of the state in the economy, outcomes the report identifies as essential for Samoa’s long-term prosperity. 

Reform Renewed is the third of five private sector assessments (PSAs) being produced by the Pacific Private Sector Development Initiative (PSDI) this year. The PSAs focus on the institutional and policy requirements for—and overcoming constraints to—broad-based private sector investment growth.

Download the report.  

Previous PSDI private sector assessments

24 September 2015

Video: women's small business pilot project in Solomon Islands

This PSDI pilot project in Solomon Islands saw female dependents of factory workers supported to create a sustainable, formal business through uniform manufacturing. 
In this short video they discuss the outcomes of the project and the opportunities now available to them. 
The pilot project is one of a number of initiatives PSDI has undertaken to demonstrate ways to support women's economic empowerment. 

1 September 2015

Timor-leste private sector assessment translated into Tetum

Growing the Non-Oil economyGrowing the Non-Oil Economy, PSDI's private sector assessment for Timor-Leste, has been translated into Tetum.

The translation into Timor-Leste's most-spoken official language will allow the insights and recommendations of the assessment to be shared with more people, particularly stakeholders and decision makers.

The translated report can be downloaded here.

31 August 2015

Online business registry launched in Vanuatu

Vanuatu Financial Services Commission (VFSC) Commissioner George Andrews, PSDI Business Law Reform Expert Aaron Levine (seated), VFSC Board Deputy Chairman Lionel Kalaut and ADB Pacific Liaison and Coordination Officer Regional Director Andrea Iffland at the launch of Vanuatu's online business registry in  Port Vila on 31 August, 2015. 
An online business registry supported by PSDI has been opened in Vanuatu.

The registry allows both Ni-Vanuatu and overseas investors to register and maintain business details and pay fees online. It will reduce the average time for company registrations from more than 3 weeks to under 3 days. The convenience, online payments and digital reminders of the registry are expected to increase compliance with business regulations, while its online search functions will increase transparency and international business confidence.

The opening of the registry represented the culmination of a series of PSDI-backed legal reforms that will dramatically simplify doing business in Vanuatu. These reforms include the recognition of new corporate structures, such as one-person companies that encourage women to register a business independently, and community companies, which allow communities to run a business and ensure the profits from it are shared fairly.

The registry was launched by the Commissioner of the Vanuatu Financial Services Commission George Andrews and Deputy Chairman of the VFSC Board Lionel Kaluat at a ceremony attended by representatives from the private sector, the ADB, and the governments of Australia and New Zealand.

An extensive public awareness raising campaign to inform people about the functions and benefits of the registry is underway. Meanwhile, training sessions are being held around the country with individuals working in sectors that are likely to be heavy users of the registry.

The registry can be found at www.vfsc.vu.

PSDI Business Law Reform Expert Aaron Levine can be heard discussing the benefits of the registry on ABC Radio here.

See news release.

25 August 2015

Women's professional leadership pilot project launched in Tonga

Participants at the first training session of PSDI's women's business leadership pilot project in Nuku'alofa, Tonga on 25 August, 2015. Also pictured are PSDI's Gender Expert Vijaya Nagarajan and pilot project trainer Valerie Mosley. 
A PSDI pilot project that will prepare women for leadership roles in the private sector has been launched in Tonga.

The pilot project will train 17 women employees of Tongan companies and organizations to become more ambitious, capable and confident in approaching leadership roles. It is one of four pilot projects being implemented under PSDI's Economic Empowerment of Women focus area.

The participants met for the first two-day training session in Nuku'alofa on 25 August, with two more training sessions to be held in the coming six months. The trainings will be complemented by online courses and the mentoring of participants by local and international business women.  

Numerous Tongan businesses and government agencies are supporting the project by encouraging their to staff to participate or mentor, providing material assistance and facilities, and committing to facilitating follow-up trainings so course participants can pass on what they learned to other women. Participating Tongan employers include the Ministry of Commerce, Tourism and Labour; Tonga Power; Pacific Retail Ltd; ANZ Bank; the Ministry of Revenue and Customs; Tonga Airports; Tonga Development Bank; and Bank South Pacific.

The next training session will be on 3-4 November.

See news release.

6 August 2015

PSDI's annual Partner's Retreat wraps up in Sydney

PSDI's annual, three-day Partners Retreat wrapped up in Sydney today.

The Retreat was attended attended by representatives from the Government of Australia’s Department of Foreign Affairs and Trade (DFAT); the Australian High Commission in Papua New Guinea; and DFAT’s Timor-Leste Desk Office, as well as representatives from the New Zealand Government’s Ministry of Foreign Affairs and Trade; Ministry of Business, Innovation and Employment; and the New Zealand Companies Office. 

Together with the PSDI team, our counterparts in PLCO, and other Pacific-based ADB staff, the Retreat participants examined the reach of PSDI and the activities of partner organizations in Pacific countries in order to identify opportunities for innovation and collaboration in private sector development programming.

22 July 2015

Private sector assessment for Timor-Leste released

Policies and programs that promote private sector development will maximize Timor-Leste’s opportunities to generate sustainable and secure sources of wealth.

This is one of the key messages from PSDI’s recently published Growing the Non-Oil Economy: APrivate Sector Assessment for Timor-Leste.

The report investigates Timor-Leste’s potential to develop a vibrant, stable and diversified economy that is not dependent on oil revenues. It proposes challenging reforms across the private sector, banking and finance, agriculture, infrastructure and judiciary.

A Tetum-language translation of the report will be released soon.

The English-language report can be downloaded here.

Previous PSDI private sector assessments.

15 July 2015

Report: Promoting Gender Equality and Women's Economic Empowerment

Under RETA 6143 Subproject, a study titled ‘Mapping and Needs Assessment of Women’s SMEs in the Pacific and Development of Intervention Strategies’ was undertaken in 2014-2015. The purpose was to conduct a comprehensive mapping assessment in six Pacific island countries of the needs, capacity, and constraints faced by women-owned and women-managed small- and medium-sized enterprises, defined as formal businesses with more than five employees. The results were intended to inform programing and enable effective participation of women’s SMEs in Pacific countries.

Download the report on the study, Promoting Gender Equality and Women's Economic Empowerment.

24 June 2015

PSDI-led reforms endorsed in Australian Government report on private sector support

A report by the Australian Parliament’s Joint Standing Committee on Foreign Affairs, Defence and Trade has endorsed PSDI reforms and drawn on numerous inputs from PSDI’s submission to the Committee.

The report is entitled ‘Partnering for the greater good: The role of the private sector in promoting economic growth and reducing poverty in the Indo-Pacific region’. Tabled on 22 June, it examines best practices domestically and internationally in PPPs, provision of finance, and facilitating participation and growth in the formal economies of developing countries.

In the report, the Committee specifically endorses PSDI’s business law reform work that is making business incorporation easier and more accessible (paragraph 3.31). The report also notes inputs from PSDI’s submission on the additional costs, market distortions and reduced ‘public good elements’ of the informal sector (par 3.14); the many barriers businesses face to entering the formal economy in the Pacific (par 3.19); and the PSDI-led reforms that are lowering these (par 3.26).

Elsewhere, the report notes PSDI’s identification of roadblocks to women’s economic empowerment as a constraint to national growth potential (par 4.6); the systematic and legal barriers to women’s formal economic participation, and the need for broader interventions to be mindful of these (par 4.44); and the success of PSDI-supported reforms to empower women at the corporate level (par 4.79).

PSDI’s comments on the harm done to the business environment through outdated and inappropriate business laws are also noted (par 5.65), as are PSDI’s comments on the need for effective financial systems (5.79).

Finally, the report incorporates PSDI’s inputs on the poor maintenance record of public infrastructure, and the economic harm of SOEs’ that are often inefficient, raise input costs of the private sector and are a drain on government budgets (par 7.11). 

Of the report’s 37 recommendations, five relate to PSDI-supported reforms discussed in PSDI’s submission. These are:

Recommendation 2.1: ‘…that the Australian Government support and facilitate opportunities which foster the participation of low income men and women in supply chains.’

Recommendation 3.2: ‘…that the Australian Government ensure aid initiatives support the 
establishment of in-country company legislation that accommodates social enterprises and other community and village corporate forms to reduce costs and the complexity of business formalisation; and promotion and assistance, particularly for women, to help them engage in the business registration process and ongoing requirements of operating a formal business.’

Recommendation 5.1: ‘…that the Australian Government prioritise access to financial services and financial education, in particular to the most disadvantaged populations, and explore options to expand current private sector and donor programs beyond the Pacific.’

Recommendation 19.3: ‘…that the Australian Government support and participate in PPPs, where found to be effective, to address social and other infrastructure needs in the Indo-Pacific region, ensuring that the Department of Foreign Affairs and Trade … continue targeted public sector capacity building initiatives for recipient governments in relation to PPPs.’

Recommendation 20.1: ‘…that in those countries or regions where access to finance is a development priority the Department of Foreign Affairs and Trade … develop a more expert understanding of the financial sector in priority countries or regions, including financing constraints for groups (such as women) targeted by the aid program.’

22 June 2015

PSDI featured in SME financing report

PSDI’s work in three countries has been featured in a new book published by the Global Partnership for Financial Inclusion.

The book, Enhancing SME Access to Finance: Case Studies, is comprised of 23 case studies of policy interventions and regulatory changes that promote SME growth through improved access to finance. The case studies are taken from all over the world and were selected from more than 100 submissions. 

PSDI-supported reforms in Solomon Islands, Vanuatu and Samoa are detailed in two case studies in the book, the only ones to highlight the Pacific region or the work of the ADB. One of the PSDI-based case studies examines the creation of registries in Vanuatu and the Solomon Islands to enable the ‘collateralization’ of movable assets. The other looks at benefits stemming from business law reforms and the creation of online business registration services in Solomon Islands and Samoa that promote the formalization of businesses.

The book can be downloaded here.

29 May 2015

PSDI delivers keynote address at Timor-Leste public-private roundtable

PSDI Financing Growth Team Leader Peter Dirou delivers the
keynote address at a Timor-Leste roundtable event examining
challenges facing the country’s private sector.
Peter Dirou, PSDI’s Financing Growth Team Leader, was keynote speaker at a high-level, private sector development roundtable in Timor-Leste on May 27.

The meeting sought to deepen dialogue between the Timor-Leste Government and the private sector to identify, and address, challenges to market-based growth. It was welcomed by PSDI, which recommends such an initiative in its soon-to-be-published Timor-Leste private sector assessment, ‘Growing the Non-Oil Economy’.

Peter discussed the role of the state in supporting private sector development on finance and introduced the key findings of Growing the Non-Oil Economy.

"The task is to identify the critical issues that have to be addressed for businesses—both national and foreign—to invest or increase their investment in Timor-Leste," said Peter.

"The solutions to challenges identified should not be rooted in new incentives offered by government, but rather in reducing uncertainty, clarifying the ‘rules of the game’, and improving the environment in which businesses operate.
The event was attended by 120 public and private sector
representatives as well as the Prime Minister, four other
Ministers and the President of the Chamber of Commerce

"Ultimately, it’s about being very clear about the role of the government and the role of the private sector and how each will contribute to improving the lives of your people."

Other speakers included Prime Minister Rui Maria de Araujo, Planning and Strategic Investment Minister Xanana Gusmao, the President of the Chamber of Commerce and Industry Oscar Lima, and the event’s host, Minister of State and Coordinator of Economic Affairs, Esanislau da Silva. Two other government ministers and 120 private and public sector representatives attended.

Click here to view Peter's presentation on the findings and recommendations of PSDI's private sector assessment of Timor-Leste. 

3 May 2015

PNG private sector assessment: Reforms key to realizing growth potential

PORT MORESBY, PAPUA NEW GUINEA (4 May 2015)Further efforts to develop the private sector are needed for Papua New Guinea (PNG) to realize its potential for economic development and secure its progression to a diversified economy, according to a PSDI report released today.
The report, Buildinga Dynamic Pacific Economy: Strengthening the Private Sector in Papua New Guinea, analyzes the complex environment affecting private sector businesses in the country, identifies the main constraints to private sector growth, and recommends policy adaptations. It was launched by Paul Holden, Lead Economist with PSDI, at a breakfast hosted by the PNG Chamber of Commerce and Industry at the Royal Papua Yacht Club in Port Moresby.
“The potential for the private sector to contribute to inclusive, broad-based and sustainable growth in PNG is very high,” said Andrea Iffland, Regional Director of ADB’s Pacific Liaison and Coordination Office in Sydney. “The recommendations arising from our analysis could help the PNG government sustain the remarkable growth of the past 8 years well into the coming decades, and ensure that future resource exports benefit the entire economy.”
To help make PNG a safer, more productive and easier place to do business, the report offers recommendations on investments in infrastructure, reforms to essential services delivery, ways in which PNG can improve access to finance for business, and efforts to improve safety in personal and business transactions. Its analysis of PNG’s business environment discusses how the broader economy can adapt to the effects of the natural resource boom, and suggests policies that can assist businesses in the non-resource sector.
The launch of Building a Dynamic Pacific Economy was
attended by a wide selection of PNG's private sector,
government and media.
The PNG private sector assessment (PSA) is an integral part of the recently approved PNG Country Partnership Strategy 2016-2020, which is ADB’s primary planning instrument for the country.

27 April 2015

State-owned enterprise reform and public-private partnerships

SOEs continue to play an important role in many Pacific island countries. 
Many absorb large amounts of scarce capital on which they provide very low returns. While some provide essential public services, many others operate as purely commercial ventures and crowd out the private sector.

Reforming SOEs and implementing public-private partnerships (PPPs) creates opportunities for private investment, reduces the costs of doing business and improves basic services by introducing private sector discipline and competitive market pressures into the SOE sector.

Through a combination of legal, regulatory and monitoring reforms and the introduction of increased private sector participation, the performance of SOEs and infrastructure service delivery is improving in the Pacific.  PPPs expand the capacity of SOEs to deliver infrastructure and related services and also allow governments to contract directly with the private sector without the involvement of SOEs.

ADB, along with its PSDI cofinance partners Australia and New Zealand, have been working with Pacific island countries on SOE reform and PPPs for more than a decade. Key in driving this agenda has been publishing PSDI’s Finding Balance series: in-depth, analysis that tracks the challenges, achievements and best practices in SOE reform in PDMCs, providing a unique benchmark with which to measure progress and share lessons learnt. Finding Balance has proved a valuable advocacy tool in driving SOE reform.

Competition issues in the Pacific

“Competition policy” encompasses the range of policies, laws, regulations, decisions, and government actions that aim to promote competitive behavior between business undertakings and rationally address any circumstances in which competition might not be efficient or might conflict with other important social objectives. As such, competition policy forms an important part of national economic policy.
Competition policy is an increasingly important theme in PSDI and is now a focus area for activity in its own right. It is especially important in Pacific island economies because of the trade-offs between small market size and economic efficiency. Lack of competition allows firms to restrict output and/or raise prices without losing sales and reducing profitability because there are no (or few) other suppliers from which consumers can purchase a particular good or service. This is often the case with basic necessities (i.e., electricity, water, and other utilities). A lack of competition may also allow firms to reduce the quality of their products while maintaining prices or ignore market pressure for change. Such outcomes are clearly against the interest of consumers, and reduce overall efficiency and growth prospects. Competition policy may advance a variety of objectives, such as:
  • ensuring market efficiency,
  • encouraging entrepreneurship and innovation,
  • supporting good governance by restricting opportunities for rent-seeking behavior,
  • supporting equality of access to economic opportunities,
  • enhancing the climate for investment, and
  • promoting sustainable and inclusive economic development.
Competition is also a far preferable alternative to price controls, which have been widely used in many Pacific island economies. Price controls distort domestic production and fail to increase supply. These then result in raised prices.
The economic value of competition between firms stems from three types of benefits:
  • Better allocation of resources. In competitive markets, producers respond to price signals so that consumers can obtain the amounts of goods and services they require at the price they are willing to pay. In a competitive framework, producers do not restrict outputs and raise prices.
  • More efficient production. The pressure of competition forces suppliers to produce their goods or services at the lowest cost possible. To maximize their profits, suppliers must find the most efficient ways to produce their goods or services.
  • Innovation. Under competitive conditions, producers are more likely to innovate and develop new products and methods of supplying products. Domestic competition prepares local businesses to better compete in regional and international markets.
Competitive pressures also help minimize supply costs and keep producers mindful of consumer demands and market trends. For the public, the benefits of competition are apparent when competition is contrasted with monopoly (or a market structure where there are only a few suppliers, which may attempt to collude). In a monopoly,
  • the quantities of goods and services available may be restricted,
  • goods and services may be outdated and produced at higher cost than necessary, and
  • consumers may be charged higher prices than they would pay in a competitive market.
However, the relative size of economies in the Pacific implies that some sectors cannot support many competitors. In some sectors, economic efficiency dictates that only one or two suppliers serve the domestic market. This does not mean, however, that competition has a small role to play in Pacific island economies. On the contrary, it strengthens the case for competition policy and competition law. Effective competition law deters suppliers that might otherwise attempt to engage in anticompetitive conduct.
To date, PSDI assistance with competition policy has been focused on three countries: the Cook Islands, Papua New Guinea, and Samoa. This will expand on both the country and regional levels as part of the third phase of PSDI 2013-19.

Pilots to empower women and enhance prosperity

Under-investment in women, who represent 40% of the world’s labour force but hold just 1% of its wealth, is now widely recognized as an opportunity cost for economic growth and business performance.  
Women in the Pacific are an enormous potential economic resource who have the capacity to greatly enhance prosperity. Gender equality is recognised as one of the drivers of change in ADB’s Strategy 2020. Since PSDI’s inception in 2007, gender mainstreaming has been applied to all its initiatives.  In 2013, PSDI began an Economic Empowerment of Women (EEOW) program, where it is actively working to identify spaces to initiate pilot programs that encourage women’s engagement with the private sector.

21 April 2015

NEWS RELEASE: Solomon Islands illustrates benefits of SOE reform

HONIARA, SOLOMON ISLANDS (22 April 2015): The Solomon Islands is leading the Pacific region in its successful reform of state-owned enterprises (SOEs), according to an Asian Development Bank (ADB) report presented in Honiara today.
The report, Finding Balance 2014: Benchmarking the Performance of State Owned Enterprises in Island Countries, shows that in the last 5 years the Government of the Solomon Islands has overseen a 21% turnaround in return on equity from SOEs, turning an average loss of 11% between 2002-2009 into an average return of 10% in 2010-2012. This improvement follows a program of increased privatization, public-private partnerships (PPPs), financial restructuring and efforts to place SOEs on a sound commercial footing.
“The outcomes the Solomon Islands has achieved—such as improved service delivery, reduced costs, and more opportunities for private investment—show what these kinds of reforms could achieve for other Pacific countries in a relatively short time,” said Laure Darcy, an SOE/PPP specialist and one of the report’s co-authors. “It also shows that reform gains can quickly be lost without ongoing efforts to sustain them.”
Finding Balance 2014 identifies strategies to guide reforms of SOEs, highlighting the importance of finding the right balance between public and private sector roles. It is the fourth in the Finding Balance series produced by the Pacific Private Sector Development Initiative (PSDI), a regional technical assistance facility co-financed by the Government of Australia, the New Zealand Government, and ADB.
The report’s findings and recommendations topped the agenda at today’s Solomon Islands State Owned Enterprise Forum, hosted by PSDI. The event, which was opened by the Permanent Secretary of the Ministry of Finance and Treasury and attended by senior representatives from both SOEs and the private sector, also heard about experiences in SOE reform in other island economies.
PSDI SOE expert Laure Darcy presents analysis from Finding Balance 2014
at the Solomon Islands State Owned Enterprise 
As the report documents, SOEs continue to exert a significant drain on the economies of the Pacific region. Analysis of SOE performance across nine countries, including six from the Pacific—Fiji, the Marshall Islands, Papua New Guinea, Samoa, Solomon Islands, and Tonga—shows that while some countries have been able to make great gains, others have struggled to enact reform.
The turnaround in the Solomon Islands has made its SOE portfolio the most profitable in the Pacific in 2010-2012. The ADB has supported a number of the reforms that have contributed to this, including the privatizations of Sasape Marina, Home Finance Limited and Solomon Island Printers, and the implementation of a community service obligation framework as required by the SOE Act of 2007.
PSDI is working with ADB's 14 Pacific developing member countries to improve the enabling environment for business and to support inclusive, private sector-led economic growth.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region.
PSDI SOE specialist Christopher Russell, Undersecretary of
Finance McKinnie Dentana and
former New Zealand SOE
Minister Richard Prebble.
SEE: Finding Balance 2014 launched in PNG
Solomon Islands SOE portfolio:
- consists of 6 SOEs: Solomon Islands Electricity Authority, Solomon Airlines, Solomon Islands Port Authority, Solomon Islands Water Authority, Solomon Islands Postal Corporation and Solomon Islands Broadcasting Authority.
- produced an average annual return on equity of –11% during 2002-2009 and 11% from 2010-2013, the most dramatic turnaround in the region. In 2013 it was the most profitable portfolio in the Pacific, returning 14% on equity and 10% on assets.
- has, since 2008, seen 4 SOEs divested through a merger, a share sale and an asset liquidation, reducing their fiscal burden on the government.
- has undergone financial restructuring of three SOEs involving the settlement of arrears, debt forgiveness and new equity investment, coupled with commercial sustainability measures.
- has implemented a community service obligation framework to support the commercial mandate of its SOEs, which has allowed over SDB80 million of services to be delivered to communities from 2011-2014 on an efficient, transparent basis.
- remains fragile and requires continued implementation of the SOE Act, partnerships with the private sector and further restructuring of its smaller SOEs. 

1 April 2015

Financing growth through more accessible finance and financial services

Financial markets in the Pacific are generally underdeveloped, and many people, particularly women, do not have access to even the most basic financial services, especially in rural areas. 

Access to credit remains a problem, despite excess liquidity across Pacific financial systems and the increased availability of savings products. Without access to financial services, businesses cannot grow, entrepreneurship is stifled, and people on low incomes cannot save securely to invest, pay bills, or move beyond subsistence living standards.

To address these issues, PSDI focuses on developing the linkages within the financial system to deliver better intermediation between savers and borrowers, so as to increase the availability of loans, securities and other financing instruments. Better financial intermediation requires improving the integrity of financial systems; strengthening selected financial institutions; designing and implementing new products tailored to the realities and particular needs of Pacific island countries; and supporting financial inclusion throughout the Pacific.

Finally, it means undertaking the analytical work to identify the institutional constraints to access to finance, and advocating for appropriate policy responses.

9 March 2015

PSDI Newsroom

3 March 2015

ADB Co-Hosts 4th Pacific Business Registries Workshop 

SYDNEY, AUSTRALIA — Senior government officials from 10 Pacific island nations, development partners and experts in private sector development gathered today at Asian Development Bank (ADB)’s office in Sydney to share their knowledge and report on progress made in the region’s expanding business registration sector. The 4th Pacific Business Registries Workshop, a 2-day event co-hosted by ADB and the New Zealand Companies Office (NZCO), will again be moderated by advisors from the Pacific Private Sector Development Initiative (PSDI). The PSDI has been helping Pacific island governments improve their business climates through company law reforms and online business registries, in partnership with NZCO.

26 February 2015

ADB Deepens Fiji Partnership with Assistance on Access to Credit

SUVA, FIJI  – The Asian Development Bank (ADB) is deepening its re-engagement with Fiji, partnering with the government to improve access to credit and to secure a stronger financial sector through secured transactions reform. Following meetings in January with Fiji’s Attorney-General and Minister for Finance Mr. Aiyaz Sayed-Khaiyum, ADB will assist the new Secured Transactions Reform Taskforce which held its inaugural meeting here today. The taskforce, which ADB will assist, brings together representatives from banks, credit unions, microfinance institutions, community groups and government agencies and will be chaired by the Governor of the Reserve Bank of Fiji, Barry Whiteside. It will provide government with a roadmap to implement secured transactions through new laws and the establishment of public online registries.

2 December 2014

Tonga’s Innovative Online Business Registry Goes Live – ADB

NUKUʻALOFA, TONGA – The Government of the Kingdom of Tonga launched the region’s first integrated online business registry today, providing up-to-date information on Tongan companies and businesses to the public 24 hours-a-day, 7 days-a-week. The site was launched by Mrs. Vaimoana Fakatulolo, CEO of Tonga’s Ministry of Commerce, Tourism & Labour, at a ceremony attended by representatives of the private sector and supporting development partners including the Asian Development Bank (ADB) and the governments of Australia and New Zealand. The new website, now live at www.businessregistries.gov.to, allows users to file and access company records, business names and business licenses all from the one integrated resource, from wherever there is internet access.

4 March 2015

Top 8 issues emerge at Pacific Business Registries Workshop

The 4th Pacific Business Registries Workshop, a two-day event co-hosted by ADB and the New Zealand Companies Office (NZCO), was held earlier this week in Sydney and over the course of discussions among experts and officials from 10 Pacific island nations, eight key issues emerged that will occupy the Pacific's registry developers, in the short to medium term (ranked in order of importance):
  1. E-payments/Online Payments  – in an age of booming e-commerce many registries still labour under cumbersome and time consuming payments systems;
  2. Ongoing support and upgrades for registries  – the technical assistance from development partners is valued but the demand for assistance is currently outstripping capacity;
  3. Linkages with other registries – countries should be developing their online registries to account for expansion to other categories such as tax, customs and charities;
  4. Legislation – compliance/enforcement are key and need to be undergoing constant process improvement;
  5. Data reporting – more functionality and software development is needed to meet  constantly expanding needs of business and government;
  6. Clarity around secured transactions –  perceived as a complex area, governments need to ensure secured transactions frameworks are adequately understood both within government and among the broader public; 
  7. Awareness raising programs  –  countries need to ensure their citizens are aware and educated about business registries to encourage their use;
  8. The Digital Divide  – the gap between who does and does not have access to the internet and connectivity must be bridged and until it is, analogue systems that people know and trust should be maintained.
The workshop was again moderated by advisors from the Pacific Private Sector Development Initiative (PSDI), which is cofinanced by ADB and the Governments of Australia and New Zealand. Since 2007 PSDI and its partners have assisted in the implementation of electronic business registries in eight Pacific countries: Federated States of Micronesia, Marshall Islands, Palau, Solomon Islands, Tonga, Vanuatu, Papua New Guinea, and Samoa.

The workshop heard first-hand updates from individual countries, complemented by technical presentations covering the latest international trends in electronic payments systems, e-government, and implementation options. What became clear is that while some countries are facing challenges, the Pacific as a region is leading the world in harnessing the power of registries to drive private sector and economic development.

26 February 2015

ADB Deepens Fiji Partnership with Assistance on Access to Credit

SUVA, FIJI – The Asian Development Bank (ADB) is deepening its re-engagement with Fiji, partnering with the government to improve access to credit and to secure a stronger financial sector through secured transactions reform.

Following meetings in January with Fiji’s Attorney-General and Minister for Finance Mr. Aiyaz Sayed-Khaiyum, ADB will assist the new Secured Transactions Reform Taskforce which held its inaugural meeting here today. The taskforce, which ADB will assist, brings together representatives from banks, credit unions, microfinance institutions, community groups and government agencies and will be chaired by the Governor of the Reserve Bank of Fiji, Barry Whiteside. It will provide government with a roadmap to implement secured transactions through new laws and the establishment of public online registries.

“ADB is encouraged by Fiji’s decision to embrace these reforms and is excited to be assisting in their implementation,” said Andrea Iffland, Regional Director of ADB’s Pacific Liaison and Coordination Office in Sydney. “Adopting a secured transactions framework will allow Fiji’s borrowers to use their movable assets as collateral for loans, and if loans go unpaid laws will be in place to ensure lenders have the certainty to easily enforce their rights over secured property.”

18 February 2015

PSDI corporate training embraced by Solomons businesswomen

The demand  for skilled company directors in Solomon Islands is matched only by the need that they be fully aware of their duties, liabilities and responsibilities. 

Now a group of enthusiastic Solomon Islands executives, mostly women, have praised a course in Corporate Governance and Management, conducted over the past six months by the Pacific Private Sector Development Initiative (PSDI) and the Solomon Islands Chamber of Commerce and Industry (SICCI). 

“I came here to learn," said company director Lynette daWheya. "This has been very good for me both professionally and personally... I didn't realise I had so much responsibility as a director."

Legal reforms supported by PSDI and culminating in the passage of the Companies Act (2009), have seen a significant increase in new company incorporations, which climbed from 127 in 2008 to 354 in 2014. Under the Act, company directors have a duty to act in good faith and in the best interests of the company. PSDI-sponsored reform of State-Owned Enterprises in recent years has seen dramatic improvement in their efficiency and profitability. These reformed institutions also need well-trained directors and senior executives to ensure effective governance.

With limited opportunities in Solomon Islands to acquire the necessary skills and knowhow, PSDI partnered with SICCI to offer a course that meets the country's needs, while ensuring the pool of directors includes more women. Of the 15 participants who completed the course, 11 were women.

15 January 2015

Is the Pacific really falling behind in ease of doing business?

The recent Devpolicy blog post ‘Doing business in 2014 – the Pacific falls behind’ describes, for Pacific island economies, some of the rankings contained in the World Bank Doing Business indicators (DBIs). As the title indicates, it concludes that in terms of business environment reform, the Pacific continues to fall behind.

Although the post qualifies its conclusions by pointing out that the independent review panel that examined the DBIs had criticized the rankings and methodology, and also adds a qualifier “(if the scores are to be believed”), its general tone is one of acceptance of the conclusions of the Doing Business scores. It then questions whether Australia has had any return to the resources that it has put into improving the environment for business in the Pacific.

The reality in the region is different from that contained in Doing Business.

13 January 2015

Asian Development Outlook Supplement: Pacific highlights for 2015

ADB has released its latest supplement to Asian Development Outlook 2014 Here are the highlights relevant to the Pacific regional economy:
Economic growth in the Pacific is seen to spike at 13.4% in 2015—multiples above 4.5% in 2013 and 5.4% in 2014—as Papua New Guinea enjoys a burst of growth in its first full year of liquefied natural gas exports. This forecast is modestly higher than in the Update, as prospects in some economies have improved. Indicators suggest Fiji’s economy is continuing to build on gains in tourism and export earnings—particularly from shipments of sugar and mineral water—and business confidence appears to be growing in the aftermath of elections in September 2014. Development partners’ reengagement with Fiji in response to the elections is also seen to boost growth prospects, and stronger economic integration is expected to generate positive spillover for the rest of the Pacific subregion. Log exports from Solomon Islands have recovered strongly since the April 2014 floods, while gold production looks likely to remain suspended for an extended period. In Palau, a rebound in tourism and construction in late 2014 pushed actual GDP growth in FY2014 (ended 30 September) slightly higher than forecast in the Update—in part a base effect as revised FY2013 data showed a deeper contraction than earlier estimated. Growth in Palau is expected to accelerate further in FY2015 as tourist arrivals pick up.
Inflation in the Pacific subregion is projected to ease from 4.5% in 2013 to 4.2% in 2014 as global commodity prices decline and inflationary pressures in Fiji moderate. Increased consumption and higher tobacco taxes and medical and educational fees in Palau have brought higher inflation, which is expected to continue through next year. Subregional inflation is projected to return to 4.5% in 2015.