Friday, July 01, 2005
Swimming Against the Tide. An Assessment of the Private Sector in the Pacific Region
By: Paul Holden, Malcolm Bale, and Sarah Holden
Report Prepared By ERI For The Asian Development Bank Under: RETA 6037: Private Sector Development Strategy For The Pacific, 2004
This report assessed conditions for private sector development in the Pacific region member countries of the Asian Development Bank. It aimed to provide an overall private sector assessment of the region that laid out an analytical foundation for strategies to assist Pacific developing member countries (PDMCs) promote their private sectors. It is organized along the following lines:
Chapter 2 outlines briefly the methodology used to assess the private sector business environment in the Pacific region. It draws on empirical research that measures the impact of various factors traditionally thought to generate growth. The result of this work is overwhelmingly that over the long run, the main determinants of private sector growth are the institutions that provide the basis for private sector activity and the transactions costs imposed upon businesses.
Chapter 3 describes the characteristics of the Pacific Island economies. It describes the effects of factors such as size, distance, and vulnerability on private sector development in the region. It examines the impact of remittances and aid and describes the pervasive presence of the State in many of these economies.
Chapter 4 describes the main issues faced by the private sector in the region. Among these are: small market size, the high costs of doing business, and the interaction and role of the public and private sectors.
Chapter 5 examines financial markets in the Pacific region. While levels of financial development vary among the countries, overall they have underdeveloped financial systems, which rely heavily on bank financing. Interest rates are characterized by fairly large spreads but interest rate levels are low compared with many developing countries. This chapter describes briefly some of the regional financing schemes, and the pros and cons of their further expansion. A theme of this chapter is that property rights issues, both for land and movable property, combine to exclude the local population, particularly those in agricultural areas, from access to finance.
Chapter 6 focuses on land issues and their impact on private sector development. Land-related property rights is one of the most difficult issues in the Pacific. The report points out that the current pervasive uncertainty and the inability of investors to enter into secure contracts to use land is harming private sector development in the region.
Chapter 7 examines briefly some sectoral issues, although the report and analysis do not take a sectoral perspective. There are some fundamental issues related to tourism development, agricultural policies, and management of fisheries that have a profound impact on private sector development in the region.
Chapter 8 looks at the interface between the role of the State in the Pacific region and how it affects private sector development. It challenges the notion that characteristics of the region imply a large and pervasive state presence and identifies how this attitude has damaged private sector development in the past.
Finally, there follows several short appendices outlining the results of the four country private sector assessments and some more detailed discussion of issues relating to secured transactions reform.
For a copy see:
Swimming Against the Tide Report
Report Prepared By ERI For The Asian Development Bank Under: RETA 6037: Private Sector Development Strategy For The Pacific, 2004
This report assessed conditions for private sector development in the Pacific region member countries of the Asian Development Bank. It aimed to provide an overall private sector assessment of the region that laid out an analytical foundation for strategies to assist Pacific developing member countries (PDMCs) promote their private sectors. It is organized along the following lines:
Chapter 2 outlines briefly the methodology used to assess the private sector business environment in the Pacific region. It draws on empirical research that measures the impact of various factors traditionally thought to generate growth. The result of this work is overwhelmingly that over the long run, the main determinants of private sector growth are the institutions that provide the basis for private sector activity and the transactions costs imposed upon businesses.
Chapter 3 describes the characteristics of the Pacific Island economies. It describes the effects of factors such as size, distance, and vulnerability on private sector development in the region. It examines the impact of remittances and aid and describes the pervasive presence of the State in many of these economies.
Chapter 4 describes the main issues faced by the private sector in the region. Among these are: small market size, the high costs of doing business, and the interaction and role of the public and private sectors.
Chapter 5 examines financial markets in the Pacific region. While levels of financial development vary among the countries, overall they have underdeveloped financial systems, which rely heavily on bank financing. Interest rates are characterized by fairly large spreads but interest rate levels are low compared with many developing countries. This chapter describes briefly some of the regional financing schemes, and the pros and cons of their further expansion. A theme of this chapter is that property rights issues, both for land and movable property, combine to exclude the local population, particularly those in agricultural areas, from access to finance.
Chapter 6 focuses on land issues and their impact on private sector development. Land-related property rights is one of the most difficult issues in the Pacific. The report points out that the current pervasive uncertainty and the inability of investors to enter into secure contracts to use land is harming private sector development in the region.
Chapter 7 examines briefly some sectoral issues, although the report and analysis do not take a sectoral perspective. There are some fundamental issues related to tourism development, agricultural policies, and management of fisheries that have a profound impact on private sector development in the region.
Chapter 8 looks at the interface between the role of the State in the Pacific region and how it affects private sector development. It challenges the notion that characteristics of the region imply a large and pervasive state presence and identifies how this attitude has damaged private sector development in the past.
Finally, there follows several short appendices outlining the results of the four country private sector assessments and some more detailed discussion of issues relating to secured transactions reform.
For a copy see:
Swimming Against the Tide Report