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MCT

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We have started to harvest the value of dialogue with the private sector ... Reducing economic dependence on public sector / civil society as the main source ... – PowerPoint PPT presentation

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Title: MCT


1
Private Sector Development
  • MCTS, GOSS
  • Presentation to the
  • Sudan Donor Consortium
  • Oslo, Norway
  • May 5-7, 2008

2
Introductory Notes
  • We are grateful for pledges made by donors for
    PSDP.
  • The MDTF project declared effective in May, 2007
    and the commitment made was USD 6.78 million for
    Phase 1, out of total Phase 1 costs of USD 11.1
    million.
  • The PSD work reported here is supported by both
    MDTF, other donors and GOSS
  • We appreciate working with development partners
  • WB Group.
  • USAID and others which have thankfully
    transferred to us some best practices
  • We renew our commitment to the project and
    development of private sector and trade in
    general.

3
Today we present
  • Background for Private Sector Development
  • The PSD project
  • Achievements to date
  • Challenges going forward
  • Proposals for future plans

4
Key Messages from this Presentation
1. Background for PSD
  • Southern Sudan has begun to attract investors
  • We have begun the journey to strengthen our legal
    policy framework for investment
  • We have begun to strengthen our institutions
    markets to stimulate support investment
  • We have started to harvest the value of dialogue
    with the private sector
  • We are on the way to building a financial
    infrastructure

5
Key background facts
1. Background for PSD
  • Great Opportunities in South Sudan
  • Strategic location, water, fertile land, natural
    resources and Diaspora
  • But No History of Private Sector Before
    Conflict
  • Northern Sudanese traders have been replaced by
    traders from other countries, still no real
    Southern Sudanese private sector
  • Huge Investments Needs,
  • But High Risks
  • Insufficient legal and regulatory framework to
    attract investors (laws, private property rights)
  • Low level of skills weak economic institutions
    (e.g. Markets)
  • Capital base destroyed by conflict
  • High real/perceived political risk
  • Few public institutions to support markets and a
    vibrant private sector
  • High incidence of poverty in periphery
  • Dutch disease Impact of oil revenues on trade,
    competitiveness, labor markets, and exchange rate

6
Private Sector Development Can Resolve Some of
the Post Conflict Constraints
1. Background for PSD
  • Maintaining political support for peace
  • The peace dividend is a job at a living wage
  • Collier half of countries that emerge from war
    revert to conflict in first decade
  • Reducing economic dependence on public sector /
    civil society as the main source of employment
  • Maximizing the role of the private sector as a
    partner in reconstruction
  • Addressing the root causes of conflict
  • Economic exclusion
  • Narrow development patterns
  • Avoiding Dutch disease
  • Reducing reliance on resource rents as the main
    source of public revenues

7
2. The MDTF PSD Project for Southern Sudan
8
The PSD MDTF Project has 4 Components
2. The PSD Project
  1. Establish an enabling policy, legal and
    regulatory environment for trade and investment
  2. Access to finance for medium, small
    micro-businesses (especially microfinance)
  3. Industrial Capacity Building
  4. Market Development (through public private
    partnership)

9
Implementation by Different GoSS Agencies
2. The PSD Project
  • Ministry of Commerce is the Coordinating Agency
  • Policy, legal Regulatory Environment (with
    MOLACD)
  • Public-Private Dialogue (with Chamber of
    Commerce)
  • Business Plan Competition (with Ministry of
    Industry)
  • Bank of Southern Sudan (BOSS)
  • Microfinance
  • Ministry of Industry Mining (with UNIDO)
  • Industrial Capacity building
  • Central Equatoria State (CES)
  • Market Development

10
Establishing an Enabling Policy Regulatory
Environment for the Private Sector
2. The PSD Project
  • Rapid establishment of a foundational regulatory
    framework
  • Re-establishment streamlining procedures for
    business registration
  • Development of an entrepreneurship policy
  • Establishment of a Public-Private Dialogue Forum
  • Building the Institutional Framework for an
    active and effective PPD Forum - Developing PPD
    Working Groups, Formulating evidence based reform
    agenda, Developing regular reform monitoring
    framework
  • Monitoring Evaluation

11
Increasing Access to Microfinance
2. The PSD Project
  • Establishing a Microfinance Apex Institution and
    a Board
  • Establishing a policy framework for microfinance
  • commercial microfinance differentiated from
    social safety nets or charity
  • Strengthening the regulatory framework for
    microfinance Recruitment of a Senior Policy
    Advisor
  • Providing liquidity to MFI's - for direct
    lending to entrepreneurs
  • Technical Assistance to MFI's
  • Financing new MFI's providing TA to Banks
    entering MF
  • Fueling innovation - to meet market demand for
    financial solutions
  • Outreach Social Mobilization - all 10 states
    disempowered groups

12
Industrial Capacity Building Component
2. The PSD Project
  • A Policy Framework to support industrial
    strategy, policy formulation and Capacity
    Building
  • Partnership with UNIDO on three sub-components
  • Develop Industrial Strategy and Policy Capacity
  • Develop Private Sector Support Institutions
  • Enhance Business Development Services in Southern
    Sudan
  • Additional sub-components
  • Analysis of Industrial Competitiveness
  • Mining Sector Capacity Building

13
Market Development
2. The PSD Project
  • Establishing a Wholesale Market
  • Building a physical marketplace gtgt with cold
    storage market stalls making trade efficient
    reducing capital costs for new entrepreneurs
  • Strengthening regulatory administrative
    capacity
  • Demonstrating an effective public-private
    partnership for infrastructure
  • Increasing food security improving nutrition
  • Establishing satellite assembly markets
  • Enhancing rural-urban linkages promoting
    commercializing agricultural production raising
    rural incomes
  • Developing market information systems
  • Increasing the flow of products through the
    marketing system through better information
    incentives

14
3. Achievements to Date
15
The Project Coordination Unit has been
Established Staffing Ongoing
3. Achievements to Date
  • Procurement of office equipment progressing
    nearly complete
  • Staffing ongoing nearly complete
  • Delays at contracting stage due to MOLACD blocks

16
A Foundational Enabling Legal Regulatory
Framework is Being Established
3. Achievements to Date
  • With the assistance of the WBG (FIAS-ICTA), GoSS
    has reviewed revised ten mercantile laws
  • Company, Investment, Partnerships, Limited
    Partnerships, Registration of Business Names,
    Registration of Documents, Insolvency, Contracts,
    Agency and Sale of Goods Law
  • 3 of these have been enacted into law through
    Provisional Orders
  • Partnerships, Limited Partnerships and
    Registration of Business Names Law
  • In addition, the Investment Law has been approved
    for signature by the President following which it
    will become law
  • The remaining six are likely to become law before
    the end of June 08 subject to the House of
    Assembly timetable

17
A Foundational Enabling Legal Regulatory
Framework is Being Established (cont.)
3. Achievements to Date
  • The Company Registry has been re-started 1600
    businesses registered since May 2007
  • 65 in construction, 25 in services
  • The Public-private dialogue Forum has been
    initiated
  • An assessment completed
  • A structure agreed with stakeholders
  • 2 Working groups are in formation
  • Sensitization ongoing

18
A Foundational Enabling Legal Regulatory
Framework is Being Established (cont.)
3. Achievements to Date
  • Progress has been made in strengthening the
    policy framework
  • Policy advisor has been identified
  • Monitoring evaluation framework for private
    sector initiated.
  • The institutional framework for investment
    facilitation is being strengthened
  • MCTS institutional assessment completed
    reorganization ongoing
  • Capacity needs assessment launched staff trained
  • Coordination among PSD ministries strengthened
  • The Southern Sudan Investment Promotion Authority
    was established by Presidential Decree in June
    2007. A Board has been appointed, and a Secretary
    General in place

19
Microfinance will soon be available to small
borrowers
  • South Sudan Microfinance Development Facility
    (SSMDF) and the microfinance policy advisor in
    process of recruitment.
  • First pilot round of Micro-finance Competition
    completed and awards totalling 1 million made to
    four MFIs
  • Internationally renowned microfinance NGO BRAC
  • Two established Sudanese MFI's
  • A Local Cooperative providing innovative rural
    finance solutions
  • Finalising Disbursement and reporting procedures
    for the microfinance component of the PSD project

20
The Industrial Capacity Building Business Plan
have Been Launched
3. Achievements to Date
  • Industrial Capacity Building
  • A Memorandum of Agreement has been signed with
    UNIDO to build capacity at Ministry, Association
    and firm level.
  • Technical Staff under the UNIDO sub-components in
    process of being hired
  • TORs for the remaining two sub-components have
    been prepared
  • Business Plan Competition
  • Approx 1000 application received
  • 60 applicants will be selected for training in
    Business Plan Preparation. After training,
    these 60 people will resubmit a proposal and the
    20 best proposals will be chosen
  • These 20 winners will receive a financial grant
    of 20,000 USD, to be deposited at a bank as
    collateral for a loan so that the winner can
    implement his or her business idea.

21
The Wholesale Market Component has Been Launched
3. Achievements to Date
  • Land title has been secured with the help of the
    State of Central Equatoria
  • PPP Wholesale Market Study Tour
  • Familiarization visit by the project team to
    similar markets in South Africa
  • Purpose To educate the implementation team on
    design, PPP, legal, other technical aspects.
  • Market concept at design stage
  • with the contracted architect

22
4. Challenges Going Forward
23
Despite this Good Progress, Challenges Remain
4. Challenges Going Forward
  • The policy, legal regulatory environment still
    weak uncertain
  • Administrative procedures are still extremely
    stringent
  • Trade policy, including relevant institutions,
    still lacking
  • Economic activities are limited to big cities
  • Capacity in the business sector is still limited
  • Access to finance still problematic, particularly
    for MSEs

24
5. Proposals for Future Plans
25
Continue implementation and expanding existing
program
  • Trade Policy continue developing trade policies
    and regulations and oversight mechanism
  • Improving Access to Finance for microfinance and
    MSEs
  • Institutional Development of Ministry Staff
  • PPD Support the Public-Private Dialogue Forum/
    partnership
  • Further support to the SSIA to build capacity and
    develop and implement an investment promotion
    strategy
  • PPP and Market Development Continue improving
    market infrastructure and private sector
    institutions
  • Legal framework work with MOLACD to implement
    promulgated laws draft additional laws seek to
    formalize more SMEs

26
New Directions
5. Proposals for Future Partnership
  • Establish standards metrology system for
    Southern Sudan, including consumer protection
    structures
  • Improve linkages with regional international
    trade/economic related organizations deepen
    regional integration
  • Reduce investment constraints at state local
    government level
  • Establish PSD coordination mechanism for Southern
    Sudan

27
In Conclusion
5. Proposals for Future Partnership
  • Southern Sudan is open for business investors
    are coming in
  • We have made significant progress in improving
    the investment climate access to markets,
    finance BDS
  • We have made progress in building a robust legal
    regulatory framework for investment
  • But a lot still needs to be done to attract
    investors make them competitive.
  • We need your further support

28
  • Thank you
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