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| M4P Public Private Day Report (2005) |
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Description
Public Private Day took place in Hanoi, Vietnam, 4th November 2005, as part of M4P week 2005, which received over 250 participants with a broad range of representation from Government, donors, researchers, NGOs, entrepreneurs and the media.
The report includes an edited version of ¿Making Markets Work for the Poor- Insights from International Cases¿, by Jim Tanburn, prepared for the Centre for Development and Enterprise, (www.cde.org.za) in August 2005 as part of the Commark project in South Africa.
Public Private Day Objectives
1. To obtain a better understanding of how public (and donor) interventions can most effectively leverage the resources of the private sector in order to achieve greater development impact.
2. To be updated on recent thinking in this area as well as on experience within Vietnam.
3. To share experience in this area with peers and develop practical recommendations for future actions.
Summary of the main points of discussion on Public Private Day
- Expectations about the relative roles of the state and the market are still uncertain in Vietnam. The nature of Vietnam¿s transition means that these roles are in a state of change and re-definition. In some sectors there are political limits on private sector providers and the reliance on the market as the means of allocating resources.
- An entry point for M4P may be to concentrate on the ¿business model¿ for service provision rather than the ownership structure. For example, looking at issues such as who pays, who provides, the coverage of the poor, the range of choices available to poor consumers and the extent of cost recovery.
- M4Pneeds to sell the concept of leveraging the private sector to extend the outreach of services and improve their effectiveness. Interestingly, experience suggests that private sector involvement in e.g. urban waste management actually improves the performance of existing public providers through a competitive effect. Well designed public procurement can help private sector providers emerge and develop in certain service markets.
- More attention needs to be paid to regulatory aspects of market performance e.g. through the implementation of competition policy. In a move to more private sector participation in service provision the pro-poor impacts should be monitored e.g. can small enterprises win service provision contracts? Are the services extended to the poor as well as the rich?
- M4Pis not about the promotion of free markets per se but rather about determining the most effective interaction between public and private sector entities. For example, how can subsidies be used intelligently to maximise development impact without undermining the market?.
- Subsidies best are deployed ¿upstream¿ where they do not affect prices in a market. Examples are the removal of systemic institutional or infrastructural bottlenecks and constraints to market development, or market building and facilitation. But price reducing subsidies in the market itself may undermine longer-term market development.
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