Opening remarks of Jane Armitage, World Bank Country Director and Regional Coordinator for Southeast Europe at the 'Towards Better Governance' Conference

September 13, 2011

Good morning,
Mr. Prime Minister thank you very much for your indeed inspiring remarks, Mr. Bode thank you for joining us, ladies and gentlemen, we are very pleased that you are participating today in this workshop on the important topic of governance.

During the course of today we will have the opportunity to discuss some of the papers of the World Bank that show the achievements that Albania has made during the last decade in improving governance in a very broad range of sectors but also discuss ways forward to address that challenges that do remain.

Try to help countries to improve governance, partly from a very narrow perspective that we believe is important to improve the effectiveness of the projects we finance, but also there is a great deal of evidence from a lot of evaluation records on many countries of all regions of the world that show that good governance lead to better developments outcomes. In other words, good governance will help improve the results from resources that many donors are providing to Albania and also will improve the investment climate and attract more investors who will come and bring capital but also innovation and new technologies and help improve competitiveness. So, there is indeed a lot of evidence that shows that countries that manage their public resources transparently and efficiently and also provide stable and predictable rules and regulations to business and citizens, these are the countries that attract more investments, both foreign and domestic, that reach high income levels and most importantly, provide better services and living conditions to their citizens. That’s why it is so important today here that everybody help to ensure that Albania is improving in a range of governance indicators.

In this region, good governance is further important for Albania’s and its neighbors’ future in the European Union. It is not by accident that good governance principles, namely democratic accountability, the rule of law, an enabling predictable regulatory environment for the private sector, sound public sector management and depoliticized public administration are at the heart of the EU accession criteria. Indeed, the EU integration process is one of the most important drivers of governance reforms in this region.

We know and we will be able to show through some of the papers the trends of governance in Albania. Because of the legacy of the communist era, Albania faced very acute governance challenges. One can see through a very broad set of indicators, some of which World Bank develops, but there are many other institutions, academic institutions or foundations that prepare different indicators of the complex aspects of governance and what will be presented today, is the result of benchmarking where the World Bank is able to use these many indicators and track how Albania has done over time and also how well it is doing compared to its neighbors. And indeed what one sees is that there has been steady progress over the last decade on a broad range of indicators. One can also see slow but steady convergence of indicators. Albania is getting closer to other countries in the neighborhood, its success in combating violent crime and restoring public order which is a particular good example. One can see improvements on a broad range of indicators. And in turn, we believe, that the impressive record of steady economic growth over the last decade and the results in the reduction of poverty are direct results of the improvements in the core governance areas such as law enforcement, economic regulations, policy formulation and public financial management.

I hope that at the end of today the work of the World Bank in Albania takes a very broad view of governance and indeed the Prime Minister’s remarks highlighted that. It is important to fight corruption, it is important to strengthen the civil service, but in fact governance is important in many sectors, in education, in health, in transport in water and across the sectors wherever the government is involved. It is governance issue to ensure that public resources are used transparently and efficiently to provide better services. I think in some ways our entire portfolio of projects that we help support here in Albania addresses governance issues. Let me mention a few: we are working with very generous support from a number of donors, who are here today, to strengthen public financial management and policy coordination through a trust fund project for strengthening the Integrated Planning System here in Albania.

We are also supporting a project to improve the business environment through predictable and transparent regulation. Another area of support is to increase the security of the immovable property rights through supporting title registration and institutional strengthening. That would be our discussion in one of our sessions today to show where progress has been made and the challenges that remain. Education is a critical area that is so important for competitiveness in the future and to improve people’s lives. And reform in financing but also setting transparent standards for testing students’ learning outcomes, so to have regular examination and to publish these results. That’s another aspect of good governance that is important that we are helping support.

We are now working on a new project with the government and with a number of other international institutions to support better quality and access to water and sanitation services, working in this case with local governments to improve accountability and financial sustainability of these investments.

And finally, an area that is so important in the region and in Albania with the global financial crisis is to strengthen the safety nets. To make sure that targeting for the safety nets go to the very poorest and to minimize leakage where safety nets funds go to people that are not so needy. And that’s an area where we have been working with Albania.

Finally let me mention that many of the papers that will be presented today were supported through the World Bank Partnership Facility which has benefited from the generous support from the UK, the Netherlands, and Norway. They have allowed us with the government to develop a whole series of sectorial analysis and some of these will be presented today and others are ongoing. And in addition this program has helped financed some very innovative governance initiatives. This was a Development Marketplace where civil society was able to move forward and get grant funding for some very innovative projects at the local level that civil society had developed to try and promote better governance. It also provided some support for the Albanian e-procurement system that the Prime Minister mentioned and as I said for a lot of analytical work for a range of sectors.
We are encouraged by the results of the survey pointing the increased satisfaction of the firms and citizens with public services and declining incidents of informal payment for services and this is something that we hope it will be continuing services. So one can be sure that this is an area where improvements continue.

Albania has made a lot of improvements in governance in some sectors but there is still a long way to go as you strive to meet the criteria for EU membership and also strive to be more competitive and attract more investments in this very difficult global environment that the Prime Minister also referred to. Some of the challenges that remain include continuing to improve not just passing of the new laws that are best practices but also ensuring that the implementation of laws and regulations continue to be strengthen.

The area of property rights is the one that we think is particular for governance. It’s a very complicated history in Albania that makes it difficult area but it is an area where the World Bank is keen to continue to work with the government to improve protection of immovable property rights. And of course, there is completing institutional reforms such as judiciary and public administration. These are again incredibly important areas for European Commission as Albania moves towards EU integration.

These are very important and complex challenges for Albania and other countries and they don’t happen overnight. They require sustainable long term efforts by the government but also support from all the political forces and civil society. We are very glad today that several civil society organizations participate and will have an opportunity to present their projects in support of the good governance. We remain committed to work with Government of course, but also with the civil society and donors to assist Albania to make these development goals a reality.

Thank you. I look forward to a very lively discussion.