Other Public Sector Study

2025-01-03, World Bank

While the state played a strong role in South Korea’s development, the state itself underwent a push for reforms in terms of promoting effective as well as impartial institutions. At the outset, institutional quality in South Korea was only marginally better than middle income countries (MIC) averages. This was followed by major improvements during the country’s upper middle-income stage. A rapid shift towards near-Organization for Economic Co-operation and Development (OECD) institutional quality occurred between 1980 and 2000, as South Korea transitioned from MIC to high-income status - when government rapidly brought corruption levels down and decisively moved to improve the public administration. An increasingly capable public sector leveraged foreign aid to support industrialists in adopting modern technologies and reinvesting profits. While risks of capture are inherent to industrial policy - and can turn such policies into a fiscal burden fueling rent-seeking - continuous public sector improvements and high-level commitment to success allowed maintaining a focus on performance rather than incumbency protection. This note focuses on the role of the state in the pursuit of middle- to high-income transitions in Europe and Central Asia (ECA). ECA MIC to high income countries (HIC) transitions account for almost one third of the countries (11 out of 34) that newly achieved high-income status since 1990 (WDR 2024) - suggesting that states in ECA converges must have gotten something right. This note explores differences in the role of the state across these groups, while also relating these back to the experience of South Korea and Finland.

2024-12-16, World Bank

This report examines the current understanding of local government capacity constraints and capacity-building approaches in the context of country-level implementation of programs within the Cohesion Policy landscape of the European Commission (EC). The work is informed by practitioner engagements in a limited set of newer member states, including Romania, Poland, Bulgaria, Croatia, and Slovakia, as well as an in-depth case study of a recently completed capacity building program in Greece. The observations and lessons are largely drawn from a focus on regional development policies and approaches, in the general context of what can be generically referred to as Regional Operational Programs Funded through the EU Cohesion Policy. The report will start with a literature review to situate the work within the realm of current public administration academic literature, approaches by development agencies, and the complexity of the responsibilities of local governments. Next, the focus shifts to the EU context with an overview of capacity building in the context of the Cohesion Policy and an in-depth case study on the design, implementation, and lessons learned from a city-level advisory engagement in Greece.Finally, a proposed framework or methodology to support policy makers and development practitioners in designing systemic capacity building approaches is presented.

2024-07-15, World Bank

In Angola, identification is a critical tool for accessing public services and facilitating inclusion and participation in local economic development. Birth registration is mandatory to obtain a National Identity (ID) card, which is a prerequisite for accessing numerous public services, including education, municipal administrative services, paying municipal fees, registering properties and vehicles, applying for a job, opening a bank account, or requesting a loan, among others. Since 2002, the Government of Angola has made great strides toward modernizing and expanding access to civil registration and identification through registration campaigns, adopting a modern ID card, and efforts to simplify procedures and digitize services. Nevertheless, significant barriers remain to improving identification coverage and accessibility. As a result, birth registration and identification are far from universal, with substantial disparities along age, rural-urban, gender, and socioeconomic divides. In the context of Angola’s digital acceleration efforts, in which it plans to digitalize public services and grow its digital economy (and, critically, introduce a digital ID solution), boosting ID coverage is critical to ensuring that digitalization does not exacerbate exclusion. This ID4D Diagnostic assesses the identification ecosystem in Angola and proposes reforms based on international good practice.

2024-06-10, World Bank

Unlike common practices in other EU member states and despite being mandated by EU law, Poland still lacks a fully-fledged Independent Fiscal Institution. IFIs are impartial, expert bodies that help improve the transparency, accountability, and quality of fiscal policies, and support sound and sustainable public finances. They became important after the 2008-09 global financial crisis showed the need for better fiscal management. Their role is to use their analyses and advocacy skills to push for long-term stability in fiscal policies. Creating a robust and effective IFI in Poland could enhance the quality and credibility of fiscal policy in the context of shifting structural budgetary dynamics. While the country performed well in the post-EU accession period, achieving rapid income convergence, and maintaining fiscal stability, it has not always complied with EU fiscal rules. With fiscal challenges set to grow in the medium and long term (i.e., due to the impact of the ageing population and increasing defense spending) the case for the establishment of an IFI is even more compelling. Recognizing that need the Polish government has expressed interest in establishing a formal IFI to enhance the quality and credibility of the Polish fiscal framework. This report supports the government of Poland in designing and implementing an IFI, aligned with international best practices while considering the specificities of the country. The report summarizes the main conclusions and recommendations from the World Bank and Ministry of Finance collaboration started in January 2024. The project included a diagnostic assessment of the existing fiscal framework and institutions, based on a benchmarking exercise against international best practices and standards of EU IFIs. The recommendations use a conceptual framework that focuses on three key aspects: the Right Form, the Right People, the Right Behavior.

2025-01-03, World Bank

People in many parts of Bosnia and Herzegovina (BiH) are exposed to more toxic particulate matter (PM) air pollution than their neighbors in Western Europe. This is especially true for residents in urban areas, such as Sarajevo. The burning of solid fuels - often of poor quality - for domestic heating and cooking, prevalence of inefficient stoves and boilers, industry, and aging vehicle fleets are the main contributors to ambient air pollution (AAP). The high levels of air pollution in the country have significant negative effects on human health and the economy. BiH recognizes air quality management (AQM) as part of a broader set of measures geared towards climate change mitigation, energy transition, and sustainable growth, particularly because air pollution control promises significant co-benefits for climate change mitigation. The cost of inaction is high, and the need for more effective AQM is widely acknowledged. Focusing efforts on the residential sector promises substantial improvements in air quality because it is the largest source of PM air pollution. he objective of this functional review (FR) is to provide insights and develop recommendations for strengthening regulatory and institutional frameworks and capacity for AQM, enabling the country, entity, and cantonal governments to deliver better air quality for its citizens. The FR assesses whether existing legislation and policies clearly define the results to be achieved, assign roles and responsibilities, and establish efficient and accountable processes on how the results are to be delivered (what government should do). At an organizational level, the FR offers a mechanism to analyze whether and how institutional and implementation arrangements are fit for purpose (what government can do).

2024-12-05, World Bank Group

As artificial intelligence (AI) becomes increasingly integral to global economies and societies, the need for effective AI governance has never been more urgent. The rapid advancement in AI technologies and their widespread adoption across many sectors, such as healthcare, finance, agriculture, and public administration, presents unprecedented opportunities and significant risks. Ensuring that AI is developed and deployed in a manner that is ethical, transparent, and accountable requires robust governance frameworks that can keep pace with technological evolution. This report explores the emerging landscape of AI governance, providing policymakers with an overview of key considerations, challenges, and global approaches to regulating and governing AI. It examines the foundational elements necessary for thriving local AI ecosystems, such as reliable digital infrastructure, a stable and sufficient power supply, supportive policies for digital development, and investment in local talent. As countries navigate this complex landscape, the report highlights the need to encourage innovation by mitigating risks like bias, privacy violations, and lack of transparency, emphasizing the importance of sustainable growth and responsible AI governance.

2024-07-05, GFDRR, World Bank

Lebanon’s experience of compounding crises over the past several years points to the nexus of fragility and disaster. The country has recently experienced one of the worst financial and economic crises in human history. The crisis derives from a set of structural causes of fragility: a combination of chronic macroeconomic imbalances and political inaction stemming from political polarization and decision-making paralysis. Lebanon’s economic model has failed to generate economic opportunities, leading to high levels of inequality and poverty. The privatization of services and their patronage-based access, coupled with the capture and mismanagement of public funds intended for infrastructure, have led to a decline in the quality of virtually all public services, including a near collapse in electricity provision. The international community’s response after this humanitarian disaster was an innovative institutional platform, the Reform, Recovery and Reconstruction Framework (3RF), aiming to facilitate recovery and reconstruction in the aftermath of the disaster while reactivating reforms to address the drivers of fragility in the country. Organized by the European Union (EU), the United Nations (UN), and the World Bank in December 2020, the 3RF not only provided a prioritized comprehensive plan across various sectors to support Beirut’s recovery and reconstruction but also included a second track to advance critical reforms to address governance challenges in Lebanon. The 3RF is a unique governance platform, backed by a fund-pooling facility (the Lebanon Financing Facility, or LFF), which links the unlocking of investments in Lebanon with the reform results so that nonhumanitarian assistance received through national institutions is conditional on the implementation of reform. While the people-centered recovery response concluded in June 2022, the 3RF continues on Track 2, which focuses on inclusive policy dialogue, the implementation of reforms, and the reconstruction of critical services and infrastructure.

2025-01-03, World Bank

People in many parts of North Macedonia are exposed to more toxic particulate matter air pollution than their neighbors in Western Europe. The burning of solid fuels for heating in homes and other buildings is a main driver of high ambient concentrations of particulate matter air pollution, particularly during the winter months. The high levels of air pollution in the country have significant negative effects on human health and the economy. The Government of North Macedonia has recognized air quality management (AQM) as a key building block toward sustainable economic development, acknowledging the link between AQM and energy policy and its significant co-benefits for climate change mitigation. The cost of inaction is high, and the need for more effective AQM is evident. The objective of this institutional and functional review (IFR) is to provide insights and develop recommendations for strengthening the legal, regulatory, and institutional framework and capacity for AQM, enabling national and local authorities to deliver better air quality for their citizens.

2024-10-25, World Bank

GovTech is a whole-of-government approach that promotes simple, efficient and transparent government with the citizen at the center of reforms. While earlier e-government programs focused on building IT systems for public administration and moving services online that often remained analog in design, GovTech strategies aim to provide citizen-centric services that are digital by design and coordinated across the government, and it prioritizes two-way interaction with citizens by mainstreaming citizen engagement.

2024-07-05, World Bank

Tax revenues to GDP ratio in the Kyrgyz Republic is higher than most lower middle income countries at above 28 percent of GDP in 2022, but complex tax structure, narrow base and remaining weaknesses in tax administration pose risks to sustainability and create unequal tax burden across taxpayers. Revenue performance in 2021-23 improved significantly due to improvements in tax administration, but significant share of the improved tax collection is contributed by VAT on imports which is likely attributed to trade diversion after imposition of trade sanctions on Russia. The transit trade driven by the sanctions has increased substantially during 2022-2023 period. If the relative share of imports would have stayed at the actual 2021 level (64.5 percent), we estimate that the transit trade contributed to increase in VAT revenues of KGS 25.2 billion (equivalent of 2.6 percent of GDP) in 2022, and an estimated KGS 37.9 billion in additional VAT revenues (3.3 percent of estimated GDP) in 2023. These one-off exceptional revenues should be isolated and treated separately when making medium-to-longer run tax revenue forecasts and when considering tax policies. This report looks into three major issues, tax gap and how it could be reasonably reduced over the medium term; needed tax policy changes; and how administration provisions in tax legislation can support the same level of tax revenues, with more equitable distribution of tax burden promoting growth and lowering compliance costs. The report touches briefly on tax administration key issues, as ongoing tax administration reform agenda supported by the World Bank funded project is currently underway.