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Speeches & Transcripts June 11, 2019

Remarks by Vice President for Europe and Central Asia Cyril Muller at Conference on Building Effective, Accountable, and Inclusive Institutions

Dear Excellencies,

Dear colleagues and participants,

Ladies and Gentlemen,

It is my pleasure to welcome to the first Europe and Central Asia Regional Governance Conference focused on Building Effective, Accountable, and Inclusive Institutions. It is a real pleasure and honor to join you here today.

Governments and citizens across the world recognize that “good governance” is essential for development. In fact, this conviction is reflected in the Sustainable Development Goals, which emphasize the need to promote peaceful and inclusive societies; provide access to justice for all and build effective, accountable and inclusive institutions.

On the one hand, this ambitious goal is perhaps easier to achieve today than at any other point in history. The advances in technology that allow us to gather and process data instantaneously and to engage citizens independently of their location are changing relationships in societies, including between public institutions and citizens.

Real-time access to information can lead to better policies, better decisions, and informed citizens. The role that governments once held as the central depository of information - and with this the privilege to act (or not) upon that information, is evolving rapidly. The democratization of information is changing expectations and perceptions of public institutions.

More horizontal relationships are replacing the traditional vertical power structure between governments and citizens. This opens the door to new opportunities for timely delivery of quality services and to demonstrate institutional effectiveness. Transparency and contestability are thus strengthened.

On the other hand, Governments cannot stay put, they must respond to higher demands and expectations from citizens and stakeholders while operating in a context of scarce public resources. When these expectations are not met, Governments face discontent and diminishing trust in institutions.

I can already tell you that the we at the World Bank don’t hold the secret ingredient that will help answer these challenges, but I can also tell you that we know more than ever before, including about the importance of solid foundations.

We know, for instance, that effective institutions are critical for economic growth. With good governance, economic growth is more likely. The 2017 World Development Report on Governance and the Law shows a clear positive correlation between aggregate measures of governance and per capita income across countries.

We also know that when citizens can exercise their right to participate and access public information they can become part of the solution. In country after country we see the benefits of citizen engagement and social accountability. Rather than managing antagonistic relationships, Governments, citizens and businesses can find solutions through collaboration. That collaboration makes positive development outcomes more likely.

We also know that accountable and transparent institutions can foster innovation. According to the World Economic Forum, weak institutions continue to hamper competitiveness. In contrast, open societies provide greater chances for intellectual development, for the emergence of new ideas, and for the dissemination of knowledge.

Finally, we also know that the quality of public administration and the capacity to deliver effective services impact the level of satisfaction and the trust of citizens. This finding is true across the whole Region, regardless of income levels.  

At the World Bank, we see governance as an integral component of the core of economic development. The counterfactual makes this very clear.

  • When institutions are not effective, all citizens suffer but especially the poor – as they depend on the provision of public services.
  • When institutions are not inclusive, large segments of societies are excluded – which can in turn create social discontent.
  • When transparency and accountability are weak, the social contract – the “glue” that brings societies together – suffers and public confidence in institutions erodes.

Over the last decade, countries in Europe and Central Asia have made major strides in strengthening governance. Allow me to cite just a few examples from across the region:

In Albania, through the implementation of a Citizen-Centric Service Delivery Project, the country was able to improve the quality of public services against customer-care standards and reduce bribes.

In Moldova, the Expert-Group – a civil society organization supported by the Global partnership for Social Accountability organized parent and student engagement in the planning and management of 80 schools , reaching over 50,000 students. More than 1,200 school administrators, teachers, parents and mayors, organized in local coalitions, are holding school administration accountable through public hearings, monitoring of school budget spending, and completing community scorecards. This approach is being scaled up to all schools in the country.

In Kosovo, a revamped cadaster produced gender disaggregated property ownership data, which has highlighted the importance of improving women’s property ownership, an agenda that the government now fully embraces.

In Armenia, through the implementation of a Tax Administration Reform Program, 96% of tax services and documents are processed and filed electronically. This resulted in a significant reduction in time for tax payments, going from 581 hours to 268 hours. Importantly, tax collection increased from 16% to over 20% of GDP.

In Azerbaijan, with the support of the World Bank, the country’s busiest court began piloting an automated system for reducing the time it takes to process cases while eliminating the possibility of human errors. By partnering with several banks and a mobile phone operator, uncontested cases are now processed in one day or less. Fast-tracking uncontested cases through the automated system freed up judges’ time to focus on more complex and demanding cases.

Institutions must also demonstrate a capacity to evolve, to adapt to the fast-changing environment. More than at any point in the past, today,

  • Governments are expected to have the capacity to deliver services in a timely, transparent and inclusive way, and share data and results instantaneously.
  • Civil society is constantly exploring ways to use technology to  strengthen the voice of citizens and hold public sector institutions accountable.
  • The private sector has to respond to increasing competition and pressures from clients, governments, and citizens to produce goods and services that are socially responsible and environmentally sustainable.

This major shift in accountability, where the burden of proof is increasingly on the providers of services, be they public or private, means that achieving and sustaining good governance will require adaptive institutions.

In closing, I would like to thank the Government of Turkey for hosting this Conference. I also want to recognize the good collaboration with our partners and friends from the European Commission, the Asian Development Bank, UN-Women, the Government of the United Kingdom, and Sigma.

I wish us all fruitful discussions, a successful conference, and advances on the path to good governance.

Thank you.