THE PROCESS OF ECOWASTHE PROCESS OF ECOWASTHE PROCESS OF ECOWAS THE PROCESS OF ECOWAS INVESTMENT POLICIES INVESTMENT POLICIES

HARMONIZATIONHARMONIZATIONJ.A. AREMU Ph.DJ.A. AREMU Ph.D

ConsultantConsultantConsultant,Consultant,ECOWAS Common Investment Market,ECOWAS Common Investment Market,

Private Sector DepartmentPrivate Sector DepartmentPrivate Sector Department,Private Sector Department,ECOWAS CommissionECOWAS Commission

Tel: 234Tel: 234--11--80330614768033061476Tel: 234Tel: 234 11 80330614768033061476EE--mail: marketlinkconsults@yahoo.commail: marketlinkconsults@yahoo.com

PART 1PART 1BASIS FOR ECOWAS COMMONBASIS FOR ECOWAS COMMONBASIS FOR ECOWAS COMMON BASIS FOR ECOWAS COMMON

INVESTMENT CODEINVESTMENT CODE

1.1. European Union Integration ModelEuropean Union Integration Model

h f l d lh f l d lThe successful European integration model, now in The successful European integration model, now in existence for over half a century, has considerable existence for over half a century, has considerable att action and impact as an e ample fo man otheatt action and impact as an e ample fo man otheattraction and impact as an example for many other attraction and impact as an example for many other regional agreements like ECOWAS.regional agreements like ECOWAS.It i di d th t th l t f EUIt i di d th t th l t f EUIt is discovered that the enlargement process of EU It is discovered that the enlargement process of EU paved the way for a peaceful unification of the paved the way for a peaceful unification of the European continent based on the value of freedomEuropean continent based on the value of freedomEuropean continent based on the value of freedom, European continent based on the value of freedom, democracy, respect for human rights and democracy, respect for human rights and fundamental liberties as well as the rule of lawfundamental liberties as well as the rule of lawfundamental liberties as well as the rule of law.fundamental liberties as well as the rule of law.

European Union Integration Model (Cont…)European Union Integration Model (Cont…)

These values and social ingredients which These values and social ingredients which accompanied European Unification are major accompanied European Unification are major p p jp p jprerequisites for the longprerequisites for the long--term socioterm socio--economic development of any regionaleconomic development of any regionaleconomic development of any regional economic development of any regional community.community.Consequently, European countries currently Consequently, European countries currently believe that they owe it as global believe that they owe it as global y gy gresponsibility to responsibility to “export”“export” their integration their integration model that has provided the continent themodel that has provided the continent themodel that has provided the continent the model that has provided the continent the needed stability in order to avoid needed stability in order to avoid “importing instability”“importing instability” from externalfrom externalimporting instabilityimporting instability from external from external trading partners.trading partners.

European Union Integration Model (Cont…)European Union Integration Model (Cont…)

This is why EU is assisting ECOWAS in its This is why EU is assisting ECOWAS in its harmonization of its variousharmonization of its various nationalnationalharmonization of its various harmonization of its various national national investment policiesinvestment policies into a regional.into a regional.Efforts to strengthen the existing regionalEfforts to strengthen the existing regionalEfforts to strengthen the existing regional Efforts to strengthen the existing regional integration among ECOWAS therefore became integration among ECOWAS therefore became criticalcriticalcritical.critical.It is believed that if such arrangement is It is believed that if such arrangement is

bl h d CO S ll dbl h d CO S ll destablished in ECOWAS region, it will provide established in ECOWAS region, it will provide legal and regulatory framework for investments legal and regulatory framework for investments

i hi h C i i di hi h C i i dwithin the Community to operate in order to within the Community to operate in order to access economies of scale in preparation to access economies of scale in preparation to

l il l l ll il l l lcompete at multilateral level. compete at multilateral level.

European Union Integration Model (Cont…)European Union Integration Model (Cont…)

Of course, to do this, it might be necessary to harmonize Of course, to do this, it might be necessary to harmonize national laws of ECOWAS member States with a regional national laws of ECOWAS member States with a regional ggfocus and consistency to make the region respond to the focus and consistency to make the region respond to the new international business trends in terms of crossnew international business trends in terms of cross--border exchanges of capital and trade flowsborder exchanges of capital and trade flowsborder exchanges of capital and trade flows.border exchanges of capital and trade flows.Such reforms would equally involve issues starting from Such reforms would equally involve issues starting from writing, or revising commercial codes, bankruptcywriting, or revising commercial codes, bankruptcywriting, or revising commercial codes, bankruptcy writing, or revising commercial codes, bankruptcy statutes, and national corporate lawsstatutes, and national corporate laws as well as as well as updating the mandate of the various regulatory agencies updating the mandate of the various regulatory agencies i th ii th iin the region.in the region.Essentially, in doing this, it is expected that the process Essentially, in doing this, it is expected that the process will permit the abolishment of uncertain and irrelevantwill permit the abolishment of uncertain and irrelevantwill permit the abolishment of uncertain and irrelevant will permit the abolishment of uncertain and irrelevant provisions, promote transparency, and improves provisions, promote transparency, and improves competitiveness of the regional economy to more actively competitiveness of the regional economy to more actively participate in international trade in addition to becoming participate in international trade in addition to becoming an attractive site for investment from outside the region.an attractive site for investment from outside the region.

2.2. Basis for Common Investment CodeBasis for Common Investment Code

The emergence of a single ECOWAS investment The emergence of a single ECOWAS investment market is expected to enhancemarket is expected to enhance increasing intraincreasing intra--market is expected to enhance market is expected to enhance increasing intraincreasing intraregionalregional and and extraextra--regionalregional cross border cross border penetration of economic activities in the penetration of economic activities in the CommunityCommunityCommunity.Community.While defensive FDI aimed at overcoming host While defensive FDI aimed at overcoming host market protection or to manipulate competition inmarket protection or to manipulate competition inmarket protection or to manipulate competition in market protection or to manipulate competition in final product markets through import substitution final product markets through import substitution strategies of ECOWAS member nations were strategies of ECOWAS member nations were j ifi d i h i di i d d illj ifi d i h i di i d d illjustified in the immediate post independent era till justified in the immediate post independent era till 1980s, the emerging regional economic integrations 1980s, the emerging regional economic integrations across the world appear to be nullifying suchacross the world appear to be nullifying suchacross the world appear to be nullifying such across the world appear to be nullifying such national import substitution motive for national import substitution motive for intraintra--ECOWASECOWAS investment investment import substitution import substitution t tt t t lt lstrategy strategy to evolve.to evolve.

Basis for Common Investment Code (Cont…)Basis for Common Investment Code (Cont…)

Wi h h i i l f h i l i dWi h h i i l f h i l i dWith the putting in place of the regional investment code, With the putting in place of the regional investment code, locational choices of ECOWAS firms are now wider within locational choices of ECOWAS firms are now wider within an integrated regional market and investments of firmsan integrated regional market and investments of firmsan integrated regional market and investments of firms an integrated regional market and investments of firms originating from nonoriginating from non--ECOWAS member countries are now ECOWAS member countries are now equally attracted to serve and exploit the consequent equally attracted to serve and exploit the consequent

i f l d i h ii f l d i h ieconomies of scale and scope in the community.economies of scale and scope in the community.Henceforth, the emerging regional integration of Henceforth, the emerging regional integration of investment laws in the Community is expected to have ainvestment laws in the Community is expected to have ainvestment laws in the Community is expected to have a investment laws in the Community is expected to have a positive effect on intrapositive effect on intra--ECOWAS trade that substitutes ECOWAS trade that substitutes intraintra--ECOWAS FDI aiming at servicing protected host ECOWAS FDI aiming at servicing protected host g g pg g peconomies.economies.The consequent free intraThe consequent free intra--firm transfer of tangible and firm transfer of tangible and i t ibl i t f d ti d f t di t ibl i t f d ti d f t dintangible inputs for production purposes, and free trade intangible inputs for production purposes, and free trade of final products for servicing individual national markets of final products for servicing individual national markets will further enhance the economies of scale.will further enhance the economies of scale.will further enhance the economies of scale.will further enhance the economies of scale.

Basis for Common Investment Code (Cont…)Basis for Common Investment Code (Cont…)

Clearly, the subsequent regional industrial Clearly, the subsequent regional industrial restructuring that is likely to be promoted by restructuring that is likely to be promoted by g y p yg y p yECOWAS investment policy harmonization is ECOWAS investment policy harmonization is expected to trigger expected to trigger intraintra--regional rationalized regional rationalized investment activities that involves relocation ofinvestment activities that involves relocation ofinvestment activities that involves relocation of investment activities that involves relocation of value added activities to the most cost efficient value added activities to the most cost efficient site based on comparative advantage of site based on comparative advantage of

d d ld d lindividual ECOWAS nations.individual ECOWAS nations.Such rationalized investment is expected also to Such rationalized investment is expected also to take the form of either vertical or horizontaltake the form of either vertical or horizontaltake the form of either vertical or horizontal take the form of either vertical or horizontal integration of ECOWAS firms; and its is expected integration of ECOWAS firms; and its is expected to be initiated by advantages coming from interto be initiated by advantages coming from inter--to be initiated by advantages coming from interto be initiated by advantages coming from intercountry differences in the supply conditions of country differences in the supply conditions of ECOWAS productive inputs as earlier explained ECOWAS productive inputs as earlier explained based on factor endowments of ECOWASbased on factor endowments of ECOWASbased on factor endowments of ECOWAS based on factor endowments of ECOWAS member States.member States.

Basis for Common Investment Code (Cont…)Basis for Common Investment Code (Cont…)

ECOWAS Investment Code seeks to provide the ECOWAS Investment Code seeks to provide the framework for designation of ECOWAS a framework for designation of ECOWAS a aa single single investment location and relates to both intrainvestment location and relates to both intra--investment location and relates to both intrainvestment location and relates to both intraECOWAS and extraECOWAS and extra--ECOWAS investment relations ECOWAS investment relations with appropriate distinctions in treatment between with appropriate distinctions in treatment between investment by ECOWAS nationals and investment byinvestment by ECOWAS nationals and investment byinvestment by ECOWAS nationals and investment by investment by ECOWAS nationals and investment by Third Party nationals. Third Party nationals. The codification of the regional investment policies isThe codification of the regional investment policies isThe codification of the regional investment policies is The codification of the regional investment policies is equally expected to mobilize investment (foreign and equally expected to mobilize investment (foreign and regional) as a driving force for economic growth and regional) as a driving force for economic growth and development of ECOWAS Communitydevelopment of ECOWAS Communitydevelopment of ECOWAS Community. development of ECOWAS Community. Clearly the codification of investment policy for Clearly the codification of investment policy for ECOWAS is expected to enhance the regional ECOWAS is expected to enhance the regional p gp ginvestment climate by:investment climate by:

a)a) Strengthening the Community’s capacity for Strengthening the Community’s capacity for designing implementing and monitoring investmentdesigning implementing and monitoring investmentdesigning, implementing and monitoring investment designing, implementing and monitoring investment policy reforms jointly in the region;policy reforms jointly in the region;

Basis for Common Investment Code (Cont…)Basis for Common Investment Code (Cont…)

b)b) Creating a regional network for policy dialogue Creating a regional network for policy dialogue among investment policy makers with other among investment policy makers with other g p yg p ystakeholders in the Community;stakeholders in the Community;

c)c) Creating a favorable environment for Creating a favorable environment for employment creation for the increasingemployment creation for the increasingemployment creation for the increasing employment creation for the increasing population of ECOWAS countries through joint population of ECOWAS countries through joint regional financial sector development and anregional financial sector development and anregional financial sector development and an regional financial sector development and an entrepreneurship culture;entrepreneurship culture;

d)d) Improving intraImproving intra--governmental policy governmental policy d d b hd d b hcoordination and cooperation between the coordination and cooperation between the

various governmental agencies in ECOWAS various governmental agencies in ECOWAS region; andregion; andregion; andregion; and

e)e) Reinforcing the impact of development Reinforcing the impact of development initiatives supported by international, regional initiatives supported by international, regional t at es suppo ted by te at o a , eg o at at es suppo ted by te at o a , eg o aand bilateral funds. and bilateral funds.

PART IIPART IIUNIFORMIZATION ORUNIFORMIZATION ORUNIFORMIZATION OR UNIFORMIZATION OR

HARMONIZATION PROCESSHARMONIZATION PROCESSThe harmonization processes are varied and can The harmonization processes are varied and can take various forms, from domestic, regional and take various forms, from domestic, regional and

l il l l ll il l l lmultilateral levels.multilateral levels.Such a process can be embodied in: the revision Such a process can be embodied in: the revision of national code; the creation of regional code;of national code; the creation of regional code;of national code; the creation of regional code; of national code; the creation of regional code; and the adoption of uniform private rules.and the adoption of uniform private rules.The most radical form of investment codeThe most radical form of investment codeThe most radical form of investment code The most radical form of investment code integration is integration is uniformization,uniformization, in which the legal in which the legal differences between the national provisions of differences between the national provisions of i t t li i ECOWAS t ii t t li i ECOWAS t iinvestment policies among ECOWAS countries are investment policies among ECOWAS countries are removed, in preference/or replacement with a removed, in preference/or replacement with a unique and identical text for all the countries inunique and identical text for all the countries inunique and identical text for all the countries in unique and identical text for all the countries in the community.the community.

Uniformization or Harmonization Uniformization or Harmonization Process (Cont )Process (Cont )Process (Cont…)Process (Cont…)

HarmonizationHarmonization, which is our concern is a less radical , which is our concern is a less radical technique as it basically consists of modifying domestictechnique as it basically consists of modifying domestictechnique, as it basically consists of modifying domestic technique, as it basically consists of modifying domestic provisions from the various countries within the Community, provisions from the various countries within the Community, which are not similar initially but to be made coherent, or which are not similar initially but to be made coherent, or y ,y ,update them with a regional reform process.update them with a regional reform process.While respecting the peculiarities of all ECOWAS countries While respecting the peculiarities of all ECOWAS countries investment policies harmonization merely permit theseinvestment policies harmonization merely permit theseinvestment policies, harmonization merely permit these investment policies, harmonization merely permit these countries to promote increased legal cooperation on countries to promote increased legal cooperation on corporate rules among themselves.corporate rules among themselves.p gp gGenerally, the result of investment policy harmonization is Generally, the result of investment policy harmonization is expected to be obtained through the directives or expected to be obtained through the directives or recommendations by the regional organization (ECOWASrecommendations by the regional organization (ECOWASrecommendations by the regional organization (ECOWAS recommendations by the regional organization (ECOWAS Commission) after extensive deliberations based on a study; Commission) after extensive deliberations based on a study; which then directs its member state after the approval of which then directs its member state after the approval of ppppthe Ministerial Committee of the Community, for the Ministerial Committee of the Community, for implementation.implementation.

Uniformization or Harmonization Uniformization or Harmonization P (C t )P (C t )Process (Cont…)Process (Cont…)

In other words, the substantive scope of the investment In other words, the substantive scope of the investment code will be determined not only by ECOWAS Commissioncode will be determined not only by ECOWAS Commissioncode will be determined not only by ECOWAS Commission code will be determined not only by ECOWAS Commission alone but also by the mandate giving it by member States alone but also by the mandate giving it by member States of the Community.of the Community.Essentiall egional in estment ha moni ation ma co e aEssentiall egional in estment ha moni ation ma co e aEssentially, regional investment harmonization may cover a Essentially, regional investment harmonization may cover a wide range of topics, establishing new substantive and/or wide range of topics, establishing new substantive and/or procedural norms for regional economic activities to thrive procedural norms for regional economic activities to thrive

llllwell.well.Therefore many issues will arise as to the preparation as Therefore many issues will arise as to the preparation as well as implementation of harmonizing the various legal well as implementation of harmonizing the various legal p g gp g ginstruments in investment harmonization code for the instruments in investment harmonization code for the region.region.On the technical front the procedures that will be used toOn the technical front the procedures that will be used toOn the technical front, the procedures that will be used to On the technical front, the procedures that will be used to elaborate and create a new investment policy framework for elaborate and create a new investment policy framework for the region will vary from the existing situation and will the region will vary from the existing situation and will depend on the institutional structure that has to be createddepend on the institutional structure that has to be createddepend on the institutional structure that has to be created depend on the institutional structure that has to be created to implement the code.to implement the code.

1.1. Preliminary Inventory on ECOWAS Preliminary Inventory on ECOWAS Countries’ Investment Policy RegimesCountries’ Investment Policy RegimesCountries’ Investment Policy RegimesCountries’ Investment Policy Regimes

It was discovered that West African countries It was discovered that West African countries have become more accommodating towards FDIhave become more accommodating towards FDIhave become more accommodating towards FDI have become more accommodating towards FDI over the last two decades, as evidenced inter alia over the last two decades, as evidenced inter alia by changes in the countries regulatory regimes.by changes in the countries regulatory regimes.y g g y gy g g y gThe changing stance towards FDI has also given The changing stance towards FDI has also given rise to proliferation of investment promotion rise to proliferation of investment promotion

i i l i d thi i l i d thagencies, special economic zones and other agencies, special economic zones and other targeted mechanisms by which ECOWAS countries targeted mechanisms by which ECOWAS countries aspire to attract foreign investorsaspire to attract foreign investorsaspire to attract foreign investors.aspire to attract foreign investors.However, there are still considerable national However, there are still considerable national differences as well as other important hurdles that differences as well as other important hurdles that ppneeded to be overcomed for most ECOWAS needed to be overcomed for most ECOWAS nations to be attractive investment sites.nations to be attractive investment sites.

Preliminary Inventory on ECOWAS Countries’ Preliminary Inventory on ECOWAS Countries’ Investment Policy Regimes (Cont…)Investment Policy Regimes (Cont…)Investment Policy Regimes (Cont…)Investment Policy Regimes (Cont…)

While it is fair to conclude that in terms of While it is fair to conclude that in terms of regulatory and statutory regimes for investment,regulatory and statutory regimes for investment,regulatory and statutory regimes for investment, regulatory and statutory regimes for investment, the region is not the most restrictive than other the region is not the most restrictive than other ACP countries, yet some obstacles demands to be ACP countries, yet some obstacles demands to be addressed Prominently among these are:addressed Prominently among these are:addressed. Prominently among these are:addressed. Prominently among these are:

(a)(a) Land and business ownershipLand and business ownership –– where many where many ECOWAS countries continue to apply restrictionsECOWAS countries continue to apply restrictionsECOWAS countries continue to apply restrictions ECOWAS countries continue to apply restrictions foreign on investors;foreign on investors;

(b)(b) Sectoral restrictionsSectoral restrictions –– with the purpose of with the purpose of ( )( ) Secto a est ct o sSecto a est ct o s t t e pu pose ot t e pu pose oprotecting small and medium scale enterprises protecting small and medium scale enterprises (SMEs), which likewise have as an unintended (SMEs), which likewise have as an unintended consequence to hold back the creation of a singleconsequence to hold back the creation of a singleconsequence to hold back the creation of a single consequence to hold back the creation of a single market economy for the entire region, and market economy for the entire region, and foreignforeign--local corporate linkages in large segments local corporate linkages in large segments gg p g g gp g g gof ECOWAS countries.of ECOWAS countries.

Preliminary Inventory on ECOWAS Countries’ Preliminary Inventory on ECOWAS Countries’ I t t P li R i (C t )I t t P li R i (C t )Investment Policy Regimes (Cont…)Investment Policy Regimes (Cont…)

(c)(c) TransparencyTransparency –– of investment regulations are in of investment regulations are in i t i d bt it diffi lt t fi di t i d bt it diffi lt t fi dmany instances in doubt; as it was difficult to find many instances in doubt; as it was difficult to find

detailed information from the existing regulatory detailed information from the existing regulatory regimes in some ECOWAS countries while aregimes in some ECOWAS countries while aregimes in some ECOWAS countries, while a regimes in some ECOWAS countries, while a number of them still apply high degree of number of them still apply high degree of administrative and/or political discretion to administrative and/or political discretion to

l t ( i i Ni i dl t ( i i Ni i dregulatory process (e.g. waiver in Nigeria under regulatory process (e.g. waiver in Nigeria under Obasanjo) without adequate consultation with Obasanjo) without adequate consultation with national stakeholdersnational stakeholdersnational stakeholders.national stakeholders.

(d)(d) Consistency of implementationConsistency of implementation –– is very is very important for investors forecast and planning; but important for investors forecast and planning; but p p g;p p g;with discretional powers the issue of integrity and with discretional powers the issue of integrity and consistency to policy is in doubt in many of the consistency to policy is in doubt in many of the countries as many of those discretions arecountries as many of those discretions arecountries as many of those discretions are countries as many of those discretions are corruptly motivatedcorruptly motivated..

PART IIIPART IIIMETHODOLOGY OF THEMETHODOLOGY OF THEMETHODOLOGY OF THE METHODOLOGY OF THE

HARMONIZATIONHARMONIZATIONThe main positive elements in ECOWAS investment The main positive elements in ECOWAS investment harmonization should include, inter alia:harmonization should include, inter alia:

i t t i d i i ith thi t t i d i i ith tha)a) private enterprise driven economies with the private enterprise driven economies with the protection of private sector rights;protection of private sector rights;

b)b) the progressive elimination of discriminatorythe progressive elimination of discriminatoryb)b) the progressive elimination of discriminatory the progressive elimination of discriminatory treatment of foreign investment and the absence of treatment of foreign investment and the absence of legal limits on financial remittances within the legal limits on financial remittances within the Community and abroad (outside the Community);Community and abroad (outside the Community);Community and abroad (outside the Community); Community and abroad (outside the Community); andand

c)c) because ECOWAS countries had, over the years, lost because ECOWAS countries had, over the years, lost )) , y ,, y ,further market share in the global FDI flows, the further market share in the global FDI flows, the region would need to adopt plans and strategies in region would need to adopt plans and strategies in timely manner to offset these negative trends so astimely manner to offset these negative trends so astimely manner to offset these negative trends so as timely manner to offset these negative trends so as to position it needy to fully benefit from new to position it needy to fully benefit from new opportunities opening up in global FDI flows. opportunities opening up in global FDI flows.

Methodology of the Harmonization (Cont…)Methodology of the Harmonization (Cont…)

From the above three elements, the methodology From the above three elements, the methodology of harmonizing investment policy would thereforeof harmonizing investment policy would thereforeof harmonizing investment policy would therefore of harmonizing investment policy would therefore have in focus three main objectives:have in focus three main objectives:li i f i i i l CO Sli i f i i i l CO Saligning of private investment to a single ECOWAS aligning of private investment to a single ECOWAS

space: that is, making of the treatment of private space: that is, making of the treatment of private i if / i il h h hi if / i il h h hinvestments uniform/similar throughout the investments uniform/similar throughout the Community;Community;achieving an increased flow of intraachieving an increased flow of intra--regional and regional and extraextra--regional investments; andregional investments; andimproving the competitiveness of existing improving the competitiveness of existing companies operating in the region to benefit from companies operating in the region to benefit from p p g gp p g gthe new initiative. the new initiative.

Phases in the Investment Phases in the Investment HarmonizationHarmonizationHarmonizationHarmonization

The harmonization of the investment policies in the region The harmonization of the investment policies in the region into a single code is to simplify the investment regulatory into a single code is to simplify the investment regulatory g p y g yg p y g yregime. regime. Such simplification involves not only a business process but Such simplification involves not only a business process but l lt l h i h ECOWAS ti t t il lt l h i h ECOWAS ti t t ialso cultural change in how ECOWAS nation states view also cultural change in how ECOWAS nation states view

those whom they regulate, and how those who are being those whom they regulate, and how those who are being regulated perceive the value and effectiveness of the regulated perceive the value and effectiveness of the egu ated pe ce e t e a ue a d e ect e ess o t eegu ated pe ce e t e a ue a d e ect e ess o t eregulatory processes.regulatory processes.It must be pointed out here that the It must be pointed out here that the simplification should simplification should

t b i t t d t i i t d dt b i t t d t i i t d dnot be interpreted to mean compromising standardsnot be interpreted to mean compromising standards; ; but it is an act of reducing or eliminating elements of the but it is an act of reducing or eliminating elements of the harmonization process in order to reduce complexity andharmonization process in order to reduce complexity andharmonization process in order to reduce complexity and harmonization process in order to reduce complexity and inefficiency, as well as to limiting the potential of any reinefficiency, as well as to limiting the potential of any re--introduction of previous cumbersome or unnecessary introduction of previous cumbersome or unnecessary investment regulatory requirements or stepsinvestment regulatory requirements or stepsinvestment regulatory requirements or steps.investment regulatory requirements or steps.

Phases in the Investment HarmonizationPhases in the Investment Harmonization(Cont )(Cont )(Cont…)(Cont…)

Four phases of the harmonization processFour phases of the harmonization processFour phases of the harmonization process Four phases of the harmonization process however require strong political commitment however require strong political commitment and s ppo t f om all ECOWAS co nt ies itand s ppo t f om all ECOWAS co nt ies itand support from all ECOWAS countries; it and support from all ECOWAS countries; it equally entail a coherent strategic approach equally entail a coherent strategic approach that organizes and prioritizes the regional that organizes and prioritizes the regional goals, as well as assigning roles, and goals, as well as assigning roles, and g , g g ,g , g g ,responsibilities resources and associated responsibilities resources and associated tasks for emerging regional regulatorytasks for emerging regional regulatorytasks for emerging regional regulatory tasks for emerging regional regulatory institutions.institutions.

A.A. The Diagnostic PhaseThe Diagnostic PhaseD fi th P d Obj ti f th I t tD fi th P d Obj ti f th I t t1.1. Define the Purpose and Objectives of the Investment Define the Purpose and Objectives of the Investment HarmonizationHarmonizationSince ECOWAS member states should have the objectives of Since ECOWAS member states should have the objectives of jjinvestment harmonization as opposed to mere change in investment harmonization as opposed to mere change in procedural regulatory arrangements towards investments, the procedural regulatory arrangements towards investments, the simplification should involve the following processes presented simplification should involve the following processes presented ii T bl 1T bl 1in in Table 1.Table 1.

2.2. Conduct Capacity AssessmentConduct Capacity AssessmentIn the course of our study we conducted a random sampling ofIn the course of our study we conducted a random sampling ofIn the course of our study, we conducted a random sampling of In the course of our study, we conducted a random sampling of the capacity of some countries within ECOWAS where we the capacity of some countries within ECOWAS where we visited to undertake a simplification initiative (e.g. Nigeria, visited to undertake a simplification initiative (e.g. Nigeria, Ghana, Senegal and Mali).Ghana, Senegal and Mali).Ghana, Senegal and Mali).Ghana, Senegal and Mali).We were aware that some definitional resistance were We were aware that some definitional resistance were encountered in the preparation of encountered in the preparation of Supplementary ActsSupplementary Acts on on investment harmonization such opportunity allowed us to beinvestment harmonization such opportunity allowed us to beinvestment harmonization, such opportunity allowed us to be investment harmonization, such opportunity allowed us to be familiar with potential barriers in the course of the familiar with potential barriers in the course of the harmonization.harmonization.Such capacity assessment will be measured under: physicalSuch capacity assessment will be measured under: physicalSuch capacity assessment will be measured under: physical Such capacity assessment will be measured under: physical capacity; human capacity; financial capacity and technology capacity; human capacity; financial capacity and technology capacity.capacity.

d f l l h

Table 1: Simplifying Regulatory ProcessesInstead of a regulatory processthat…

Ensure a regulatory process that…

Is designed to eliminate risk on Achieves a balance between the risk and noncompliance… the cost of mitigating the risk and with a

reasonable burden on businesses.

Has a significant administrative cost Is streamlined to the extent possible toHas a significant administrative cost, either for the governments of ECOWAS States or the

Is streamlined to the extent possible to reduce cost, time and complexity.

Has evolved without an examination Has mitigated consequences to theHas evolved without an examinationof possible consequences…

Has mitigated consequences, to the extent possible.

Has enforcement that is process Is adaptive, results-based, and t t d t dd i k i dcentered... structured to address risks in order

of priority.

Overlaps or conflicts with other Is harmonized with other processes regulatory processes or jurisdictions... within the ECOWAS Community, and

does not place the region at a competitive disadvantage with other d l i t i i t fdeveloping countries in terms of investment climate.

3.3. Conduct Detailed Analysis of ProcessConduct Detailed Analysis of Process

(a) Assessing the Impact of the Existing (a) Assessing the Impact of the Existing Regulatory ProcessRegulatory ProcessRegulatory ProcessRegulatory ProcessOne tool used in regulatory review One tool used in regulatory review processes is a Regulatory Impact processes is a Regulatory Impact Assessment (RIA). Assessment (RIA). ( )( )Also is the use of the questionnaire Also is the use of the questionnaire app oach to obtain a st ategic opinion onapp oach to obtain a st ategic opinion onapproach to obtain a strategic opinion on approach to obtain a strategic opinion on where changes in regulatory process may where changes in regulatory process may be most beneficial.be most beneficial.

b) Mapping Existing Elements of Processb) Mapping Existing Elements of ProcessFollowing the strategic review of the regulatory process aFollowing the strategic review of the regulatory process aFollowing the strategic review of the regulatory process a Following the strategic review of the regulatory process a detailed analysis of the activities associated with the process detailed analysis of the activities associated with the process in question can be conducted. in question can be conducted. W d t d th t d i i b i iW d t d th t d i i b i iWe understood that designing a business process requires We understood that designing a business process requires an understanding of the elements of the existing process. an understanding of the elements of the existing process. This necessitated a review of the existing regulatory process This necessitated a review of the existing regulatory process s ecess tated a e e o t e e st g egu ato y p ocesss ecess tated a e e o t e e st g egu ato y p ocessby conducting an by conducting an “as is” or “baseline”“as is” or “baseline” analysis, which analysis, which involves:involves:Reviewing the countries” “Snapshot of BusinessReviewing the countries” “Snapshot of BusinessReviewing the countries Snapshot of Business Reviewing the countries Snapshot of Business Environment” and related “Doing Business” indicators and Environment” and related “Doing Business” indicators and information on the. Assignment in all the countiesinformation on the. Assignment in all the countiesId tif i d t i d t th t iId tif i d t i d t th t iIdentifying documents required to accompany the request in Identifying documents required to accompany the request in order to start a business process.order to start a business process.Identifying and analyzing each step in the processing of Identifying and analyzing each step in the processing of y g y g p p gy g y g p p ginformation.information.Identifying and analyzing the activities triggered by the Identifying and analyzing the activities triggered by the requestrequestrequest.request.Identifying and analyzing the results of the processing of Identifying and analyzing the results of the processing of informationinformation

4.4. Define Performance IndicatorsDefine Performance Indicators

Since “What gets measured gets done”. Since “What gets measured gets done”. Fundamental to the investmentFundamental to the investmentFundamental to the investment Fundamental to the investment simplification and harmonisation process simplification and harmonisation process are performance targets to be measured;are performance targets to be measured;are performance targets to be measured; are performance targets to be measured; There is thus, the need to ensure that There is thus, the need to ensure that performance is measured from the very performance is measured from the very inception of the initiative to ensure that inception of the initiative to ensure that performance targets are met. performance targets are met. Without accurately recording data, theWithout accurately recording data, theWithout accurately recording data, the Without accurately recording data, the region will not be able to determine whether region will not be able to determine whether the exercise will be meeting its goals or not.the exercise will be meeting its goals or not.the exercise will be meeting its goals or not.the exercise will be meeting its goals or not.

Define Performance Indicators (Cont…)Define Performance Indicators (Cont…)

In order to determine whether a simplification In order to determine whether a simplification initiative has been successful, it is necessary to initiative has been successful, it is necessary to , y, yconduct an evaluation, essentially taking a conduct an evaluation, essentially taking a “before”“before” and and “after”“after” snapshot of performance. snapshot of performance. To do this, the diagnostic phase should include a To do this, the diagnostic phase should include a benchmarking benchmarking exercise (in my second paper) to exercise (in my second paper) to

t f i di t i t tht f i di t i t thcapture performance indicators prior to the process capture performance indicators prior to the process design. The following stages to be benchmarked design. The following stages to be benchmarked are:are:are:are:Start of the investment simplification initiativeStart of the investment simplification initiativeI iti l t t i tI iti l t t i tInitial measurement at process mapping stageInitial measurement at process mapping stageCompletion of simplification initiativeCompletion of simplification initiativeAudit measurementAudit measurement

5.5. Analyze Existing Legal AuthorityAnalyze Existing Legal AuthorityO i t t l t f th di ti h iO i t t l t f th di ti h iOne important element of the diagnostic phase is a One important element of the diagnostic phase is a legal review, to alert on the very areas where legal legal review, to alert on the very areas where legal reforms may be required and to ensure thatreforms may be required and to ensure thatreforms may be required and to ensure that reforms may be required and to ensure that contemplated steps in such redesign fall within the contemplated steps in such redesign fall within the governing national and regional legal authorities. governing national and regional legal authorities. I if i th l t i ECOWASI if i th l t i ECOWASIn verifying the regulatory process in ECOWAS In verifying the regulatory process in ECOWAS countries, consideration will have to be given to countries, consideration will have to be given to administrative and constitutional law principles inadministrative and constitutional law principles inadministrative and constitutional law principles in administrative and constitutional law principles in force in the various countries in the community.force in the various countries in the community.However, some general issues should be However, some general issues should be

id did dconsidered:considered:What are the relevant legal authorities since all of What are the relevant legal authorities since all of the laws regulations bythe laws regulations by--laws orders etc thatlaws orders etc thatthe laws, regulations, bythe laws, regulations, by--laws, orders, etc., that laws, orders, etc., that apply to investment harmonization process under apply to investment harmonization process under review must be identified and then examined;review must be identified and then examined;Is there any need to create a new legal authority in Is there any need to create a new legal authority in each of ECOWAS country or to use existing ones?each of ECOWAS country or to use existing ones?

Analyze Existing Legal Authority (Cont…)Analyze Existing Legal Authority (Cont…)Wh i h f h l l h i llWh i h f h l l h i llWhat is the scope of the legal authority to cover all aspects What is the scope of the legal authority to cover all aspects of the contemplated process design? of the contemplated process design? What institutional mechanisms to put in place for the legalWhat institutional mechanisms to put in place for the legalWhat institutional mechanisms to put in place for the legal What institutional mechanisms to put in place for the legal authority?authority?Does any step contemplated in the harmonization process Does any step contemplated in the harmonization process y p p py p p pdesign conflict with any other requirement imposed by design conflict with any other requirement imposed by another legal authority in force?another legal authority in force?Does the legal a tho it ha e the sole and enfo ceable toolsDoes the legal a tho it ha e the sole and enfo ceable toolsDoes the legal authority have the sole and enforceable tools Does the legal authority have the sole and enforceable tools to make rules and or to decide compliance on a caseto make rules and or to decide compliance on a case--byby--case case basis?basis?What are the ways and means available to the legal authority What are the ways and means available to the legal authority for the purposes of dealing with the particular process?for the purposes of dealing with the particular process?The process of verifying the existing legal authority will The process of verifying the existing legal authority will permit the simplification/permit the simplification/harmonization teamharmonization team to evaluate to evaluate the legal foundations of the existing process so as to designthe legal foundations of the existing process so as to designthe legal foundations of the existing process so as to design the legal foundations of the existing process so as to design the new one that will not negatively affect the existing one.the new one that will not negatively affect the existing one.

6.6. Review of Regulatory Policy Support for Review of Regulatory Policy Support for Investment HarmonisationInvestment HarmonisationInvestment HarmonisationInvestment Harmonisation

Examining the region’s regulatory policy via the Examining the region’s regulatory policy via the ECOWAS P i t S t D t t f ECOWASECOWAS P i t S t D t t f ECOWASECOWAS Private Sector Department of ECOWAS ECOWAS Private Sector Department of ECOWAS Commission is important in relation to the investment Commission is important in relation to the investment policy harmonisation and simplification initiative since it policy harmonisation and simplification initiative since it p y pp y pprovides the framework that will govern any regulatory provides the framework that will govern any regulatory process design.process design. Such regional regulatory policy should:Such regional regulatory policy should:Define the objectives of each regulatory processDefine the objectives of each regulatory processDefine the objectives of each regulatory process.Define the objectives of each regulatory process.Support the good design of regulatory processes.Support the good design of regulatory processes.Require reviews to revise outdated steps in regulatoryRequire reviews to revise outdated steps in regulatoryRequire reviews to revise outdated steps in regulatory Require reviews to revise outdated steps in regulatory processes or eliminate obsolete processes.processes or eliminate obsolete processes.Ensure the effective implementation of regulatory Ensure the effective implementation of regulatory p g yp g yprocesses.processes.Provide measured, adequate and sufficient enforcement.Provide measured, adequate and sufficient enforcement.A id fli t ith th l tA id fli t ith th l tAvoid conflicts with other regulatory processesAvoid conflicts with other regulatory processes

B.B. Common Investment Code Project Common Investment Code Project D i PhD i PhDesign PhaseDesign Phase

It is believed that once there is a clear picture of the It is believed that once there is a clear picture of the existing regulatory process for the implementation of aexisting regulatory process for the implementation of aexisting regulatory process for the implementation of a existing regulatory process for the implementation of a common ECOWAS investment policy harmonisation, the common ECOWAS investment policy harmonisation, the next phase involves designing and simplifying that next phase involves designing and simplifying that e t p ase o es des g g a d s p y g t ate t p ase o es des g g a d s p y g t atprocess based on information supplied during the process based on information supplied during the diagnostic stage. diagnostic stage. My findings revealed that there are a number of different My findings revealed that there are a number of different aspects to consider in approaching the designing stage of aspects to consider in approaching the designing stage of the simplificationthe simplificationthe simplification. the simplification. It is important to emphasize that this phase requires a It is important to emphasize that this phase requires a “business process re“business process re--engineering”engineering” approach, namely approach, namely pp g gg g pp , ypp , yone of changing a regulatory process, or aspects of it, to one of changing a regulatory process, or aspects of it, to improve the performance indicators that have been improve the performance indicators that have been determined as being important to the earlierdetermined as being important to the earlierdetermined as being important to the earlier. determined as being important to the earlier. I elaborate on this below under seven (7) issues.I elaborate on this below under seven (7) issues.

1.1. Simplification of Investor IdentificationSimplification of Investor Identification

The first aspect to consider is the identification of The first aspect to consider is the identification of prospective investors into each country in the ECOWAS prospective investors into each country in the ECOWAS

i ( i i ECOWAS i t di ( i i ECOWAS i t d ECOWASECOWASregion (comprising ECOWAS investors and nonregion (comprising ECOWAS investors and non--ECOWAS ECOWAS investors), or in cases where the investors have multiple investors), or in cases where the investors have multiple dealings with countries in the region, the identification ofdealings with countries in the region, the identification ofdealings with countries in the region, the identification of dealings with countries in the region, the identification of the area of investment and its association with the other the area of investment and its association with the other investors. investors. Simplifying identification facilitates the organization of a Simplifying identification facilitates the organization of a filing and documentation systems that permit staff of the filing and documentation systems that permit staff of the investment regulatory bodies in the region to have easyinvestment regulatory bodies in the region to have easyinvestment regulatory bodies in the region to have easy investment regulatory bodies in the region to have easy access to inquiries or other relevant information in the access to inquiries or other relevant information in the process.process.ppSuch simplification will ensure that documentations of Such simplification will ensure that documentations of each investor is correctly ascertained.each investor is correctly ascertained.

2.2. Examination of Time FramesExamination of Time Frames

Each step in a process takes time to Each step in a process takes time to completecompletecomplete. complete. The question then becomes whether the The question then becomes whether the ti t k d t i d d i thti t k d t i d d i thtime taken, as determined during the time taken, as determined during the comprehensive review, is excessive, comprehensive review, is excessive, i f th bj ti i t di f th bj ti i t dsince one of the objectives is to reduce since one of the objectives is to reduce

the time taken to complete process of the time taken to complete process of itti i t t i t th iitti i t t i t th icommitting investment into the region. committing investment into the region.

The effects of simplification on time The effects of simplification on time ppframes can be significantframes can be significant..

3.3. Design ProcessDesign Processgg

In addition to examining the processes for In addition to examining the processes for information submission identifying prospectiveinformation submission identifying prospectiveinformation submission, identifying prospective information submission, identifying prospective investors, and the time frames for completion of investors, and the time frames for completion of request on investment in any particular countryrequest on investment in any particular countryrequest on investment in any particular country, request on investment in any particular country, simplification involves taking a series of steps simplification involves taking a series of steps that currently exist and reducing them to the that currently exist and reducing them to the y gy gminimum number required. minimum number required. This will involve harmonizing the activities of This will involve harmonizing the activities of gginvestment promotion agencies in ECOWAS to a investment promotion agencies in ECOWAS to a standard format.standard format.This takes substantial work and called for use of This takes substantial work and called for use of modern technology.modern technology.

4.4. Role of TechnologyRole of Technology4.4. Role of TechnologyRole of TechnologyFor the purposes of simplification, an important For the purposes of simplification, an important consideration is the fact that informationconsideration is the fact that informationconsideration is the fact that information consideration is the fact that information technology can have a useful, even important, technology can have a useful, even important, role in the design of a regulatory process.role in the design of a regulatory process.role in the design of a regulatory process. role in the design of a regulatory process. Indeed, the proposed implementation of new Indeed, the proposed implementation of new technology may serve as a catalyst to investment technology may serve as a catalyst to investment tec o ogy ay se e as a cata yst to est e ttec o ogy ay se e as a cata yst to est e tpolicy harmonisation process within ECOWAS as policy harmonisation process within ECOWAS as it will enhance how things are get done quickly in it will enhance how things are get done quickly in the design stage as well as during the design stage as well as during implementation. implementation. It should be noted that the It should be noted that the use of technology use of technology is not a panaceais not a panacea and will not be beneficial if and will not be beneficial if th i t d l t t fi tth i t d l t t fi tthe associated regulatory processes are not first the associated regulatory processes are not first and foremost streamlined into singular format.and foremost streamlined into singular format.

Role of Technology (Cont…)Role of Technology (Cont…)However the use or nonHowever the use or non use of technology should notuse of technology should notHowever, the use or nonHowever, the use or non--use of technology should not use of technology should not dictate whether or not simplification should occur. dictate whether or not simplification should occur. It may be feasible, and desirable, to reform a It may be feasible, and desirable, to reform a y , ,y , ,regulatory process even if no change in technology is regulatory process even if no change in technology is contemplated or no use of technology is even contemplated or no use of technology is even consideredconsideredconsidered. considered. Since the regional regulatory process involves inputs, Since the regional regulatory process involves inputs, steps and outcomes, then the use of technology is well steps and outcomes, then the use of technology is well

d h f dd h f dsuited to the management of inputs, steps and suited to the management of inputs, steps and outcomes because they involve the communication, outcomes because they involve the communication, distribution and processing of information.distribution and processing of information.distribution and processing of information. distribution and processing of information. In many parts of the world, suitable technology is In many parts of the world, suitable technology is readily available like the readily available like the Web Portal ApproachWeb Portal ApproachTechnology may also contribute to increased Technology may also contribute to increased transparency by permitting the widespread and easy transparency by permitting the widespread and easy dissemination of process requirementsdissemination of process requirementsdissemination of process requirements. dissemination of process requirements.

Role of Technology (Cont…)Role of Technology (Cont…)However a useful step in the investment policyHowever a useful step in the investment policyHowever a useful step in the investment policy However a useful step in the investment policy harmonisation and simplification initiative entails harmonisation and simplification initiative entails investigating whether ECOWAS as an institution and its investigating whether ECOWAS as an institution and its member countries have the resources to incorporate andmember countries have the resources to incorporate andmember countries have the resources to incorporate and member countries have the resources to incorporate and deploy appropriate technology (e.g. The Investment Web deploy appropriate technology (e.g. The Investment Web Portal) for the assignment is crucial.Portal) for the assignment is crucial.A i i i h f ll i d hA i i i h f ll i d hA most pertinent question is the following: does the A most pertinent question is the following: does the ECOWAS region have the capacity to plan the deployment ECOWAS region have the capacity to plan the deployment of appropriate technology? If not, capacity building will be of appropriate technology? If not, capacity building will be pp p gy , p y gpp p gy , p y grequired to assist national institutions. required to assist national institutions. It makes little sense to consider technology solutions if It makes little sense to consider technology solutions if the community does not have the people to determinethe community does not have the people to determinethe community does not have the people to determine the community does not have the people to determine how to incorporate it into the business processes. how to incorporate it into the business processes. Consultants may be used to provide a comprehensive Consultants may be used to provide a comprehensive solution but the use of experts has to be factored into thesolution but the use of experts has to be factored into thesolution but the use of experts has to be factored into the solution but the use of experts has to be factored into the cost of the simplification initiative.cost of the simplification initiative.Such Web Portal should have networking and clearing Such Web Portal should have networking and clearing h d h dh d h dhouse opportunities stationed at each country and house opportunities stationed at each country and monitored at the regional regulatory agency’s office.monitored at the regional regulatory agency’s office.

5.5. Assess the Proposed ProcessAssess the Proposed ProcessThe initial development of the harmonization policyThe initial development of the harmonization policyThe initial development of the harmonization policy The initial development of the harmonization policy was expected to have been prepared in an was expected to have been prepared in an Investment Policy Framework (IPF) to provide a Investment Policy Framework (IPF) to provide a y ( ) py ( ) pframework against which to review proposed framework against which to review proposed policies and regulatory processes would be policies and regulatory processes would be premisedpremisedpremised. premised. The object is to ascertain whether the proposed The object is to ascertain whether the proposed investment harmonisation is consistent with theinvestment harmonisation is consistent with theinvestment harmonisation is consistent with the investment harmonisation is consistent with the principles in the IPF. principles in the IPF. One tool to use in conducting this assessment is a One tool to use in conducting this assessment is a ggRegulatory Impact Assessment (RIA)Regulatory Impact Assessment (RIA)Statement; while another is a Statement; while another is a Business Impact Business Impact Test (BIT)Test (BIT)Test (BIT).Test (BIT).While not panaceas, they provide useful tools to While not panaceas, they provide useful tools to review the quality of proposed investment policyreview the quality of proposed investment policyreview the quality of proposed investment policy review the quality of proposed investment policy harmonisation and design changes in the regional harmonisation and design changes in the regional IPF.IPF.

(a)(a) Regulatory Impact AssessmentRegulatory Impact AssessmentA Regulatory Impact Analysis is a tool that can be used to assessA Regulatory Impact Analysis is a tool that can be used to assessA Regulatory Impact Analysis is a tool that can be used to assess A Regulatory Impact Analysis is a tool that can be used to assess both the possible implications of a proposed investment policy both the possible implications of a proposed investment policy harmonization process and the current consequences associated harmonization process and the current consequences associated with existing process.with existing process.with existing process. with existing process. RIAs have been recognized and used as a tool in most OECD RIAs have been recognized and used as a tool in most OECD countries and, to a much more limited degree, in developing countries and, to a much more limited degree, in developing countries in order to understand or at leastcountries in order to understand or at least gauge thegauge thecountries in order to understand or, at least, countries in order to understand or, at least, gauge the gauge the economic and social impact of regulationseconomic and social impact of regulations and associated and associated regulatory processes. regulatory processes. In order to avoid possible confusion it should be noted that aIn order to avoid possible confusion it should be noted that aIn order to avoid possible confusion, it should be noted that a In order to avoid possible confusion, it should be noted that a RIA is distinct from a related tool RIA is distinct from a related tool ---- the the Sustainability Impact Sustainability Impact AssessmentAssessment (SIA). (SIA). A SIA is a process used to identify economic socialA SIA is a process used to identify economic social andandA SIA is a process used to identify economic, social A SIA is a process used to identify economic, social and and environmental environmental impacts of a proposal. impacts of a proposal. Our focus here is to discuss the use of an RIA process to ensure Our focus here is to discuss the use of an RIA process to ensure the appropriateness of the proposed design of ECOWASthe appropriateness of the proposed design of ECOWASthe appropriateness of the proposed design of ECOWAS the appropriateness of the proposed design of ECOWAS investment policy in the context of a simplification initiative. investment policy in the context of a simplification initiative. Therefore an RIA is a process to collect evidence to support Therefore an RIA is a process to collect evidence to support decisions to be made in connection with the investment policydecisions to be made in connection with the investment policydecisions to be made in connection with the investment policy decisions to be made in connection with the investment policy harmonisation process and design.harmonisation process and design.

(b)(b) Business Impact TestBusiness Impact TestA related type of assessment, a subset of an RIA, is a A related type of assessment, a subset of an RIA, is a Business ImpactBusiness Impact Test (BIT) Test (BIT) -- a tool designed to allow a tool designed to allow regional officials monitoring the investment policyregional officials monitoring the investment policyregional officials monitoring the investment policy regional officials monitoring the investment policy harmonisation process to understand and evaluate the impact harmonisation process to understand and evaluate the impact of the process on business of proposed policies or processes. of the process on business of proposed policies or processes. While a RIA examines the impact on both government andWhile a RIA examines the impact on both government andWhile a RIA examines the impact on both government and While a RIA examines the impact on both government and private sector, a private sector, a BIT considers only the impact on the BIT considers only the impact on the private sectorprivate sector, especially where the concern relates to the , especially where the concern relates to the impact of a policy or process change on small or medium sizeimpact of a policy or process change on small or medium sizeimpact of a policy or process change on small or medium size impact of a policy or process change on small or medium size businesses. businesses. A BIT may be a preferable alternative to consider if there are A BIT may be a preferable alternative to consider if there are questions on the capacity of ECOWAS monitoring agenciesquestions on the capacity of ECOWAS monitoring agenciesquestions on the capacity of ECOWAS monitoring agencies questions on the capacity of ECOWAS monitoring agencies officials or their project teams to conduct an RIA on the officials or their project teams to conduct an RIA on the proposed investment code. proposed investment code. BIT f l th it tBIT f l th it tBITs are useful as they permit to:BITs are useful as they permit to:understand how businesses respond to regulation;understand how businesses respond to regulation;assess alternatives;assess alternatives;assess alternatives;assess alternatives;identify unintended and unexpected effects; andidentify unintended and unexpected effects; andenable businesses to provide input.enable businesses to provide input.

Business Impact Test (Cont…)Business Impact Test (Cont…)The main purpose of BIT is to minimize the cost forThe main purpose of BIT is to minimize the cost forThe main purpose of BIT is to minimize the cost for The main purpose of BIT is to minimize the cost for compliance with the new regulations and regulatory compliance with the new regulations and regulatory processes, while allowing the region to achieve its public processes, while allowing the region to achieve its public policy objectivespolicy objectivespolicy objectives. policy objectives. The BIT methodology is based on conducting a survey of The BIT methodology is based on conducting a survey of businesses that seeks answers to questions about:businesses that seeks answers to questions about:Th di t i t f th h i ti b iTh di t i t f th h i ti b ia)a) The direct impact of the harmonization on business The direct impact of the harmonization on business operations, including prices, products/services, access to operations, including prices, products/services, access to markets, relations with suppliers, investments, etc;markets, relations with suppliers, investments, etc;

b)b) Possible concerns with the design and structure of the policy Possible concerns with the design and structure of the policy or process, including compliance and information submission or process, including compliance and information submission requirements recommended by the new code;requirements recommended by the new code;q y ;q y ;

c)c) Potential operational/personnel costs and benefits, if any, to Potential operational/personnel costs and benefits, if any, to the respondents, both the respondents, both anteante andand ex post;ex post;

d)d) Views as to whether the regulations are necessary andViews as to whether the regulations are necessary andd)d) Views as to whether the regulations are necessary and Views as to whether the regulations are necessary and appropriate; andappropriate; and

e)e) “Consider the demographic” business information (e.g., “Consider the demographic” business information (e.g., location employment sales etc ) to permit analysts tolocation employment sales etc ) to permit analysts tolocation, employment, sales, etc.) to permit analysts to location, employment, sales, etc.) to permit analysts to examine responses based on criteria such as area within a examine responses based on criteria such as area within a region, a country or based on size of businesses.region, a country or based on size of businesses.

Business Impact Test (Cont…)Business Impact Test (Cont…)

The harmonization of investment into a singular codeThe harmonization of investment into a singular codeThe harmonization of investment into a singular code The harmonization of investment into a singular code process is not intended to process is not intended to create another layer of create another layer of bureaucracybureaucracy but rather to change the culture within but rather to change the culture within government departments in all ECOWAS countries ingovernment departments in all ECOWAS countries ingovernment departments in all ECOWAS countries in government departments in all ECOWAS countries in order to develop a sense of ownershiporder to develop a sense of ownership of the principles of of the principles of the regulatory policy and to consider the process as a the regulatory policy and to consider the process as a b d li f i b ib d li f i b ibetter delivery of service to guarantee better investment better delivery of service to guarantee better investment flows (both inflow and outflow). flows (both inflow and outflow). It is important to note that expectations of theseIt is important to note that expectations of theseIt is important to note that expectations of these It is important to note that expectations of these regulatory analysis tools should be tempered, since even regulatory analysis tools should be tempered, since even in developed countries, the practical application of the in developed countries, the practical application of the process sees few full benefit/cost analyses done inprocess sees few full benefit/cost analyses done inprocess sees few full benefit/cost analyses done, in process sees few full benefit/cost analyses done, in particular regarding the direct costs which are better particular regarding the direct costs which are better addressed than indirect costs. addressed than indirect costs. Despite these weaknesses, these types of processes do Despite these weaknesses, these types of processes do force officials to examine information that is valuable in force officials to examine information that is valuable in making policy or process decisions. making policy or process decisions. a g po cy o p ocess dec s o sa g po cy o p ocess dec s o sThey also cause officials to expressly consider the impact They also cause officials to expressly consider the impact upon all stakeholders.upon all stakeholders.

6.6. Involve Stakeholders through Involve Stakeholders through ConsultationsConsultationsConsultationsConsultations

Consultations reflect one or more processes Consultations reflect one or more processes whereby governments seek the views of individualswhereby governments seek the views of individualswhereby governments seek the views of individuals whereby governments seek the views of individuals or groups affected by a proposed investment or groups affected by a proposed investment harmonization policy, program or service. harmonization policy, program or service. C l i l i i f i l dC l i l i i f i l dConsultations also assist in framing unresolved Consultations also assist in framing unresolved issues or in evaluating proposed choices in the issues or in evaluating proposed choices in the harmonization process designharmonization process designharmonization process design.harmonization process design.A “stakeholder” may be considered an individual, a A “stakeholder” may be considered an individual, a business or any group of individuals or businesses business or any group of individuals or businesses bus ess o a y g oup o d dua s o bus essesbus ess o a y g oup o d dua s o bus esseswho may be affected by the outcome of the who may be affected by the outcome of the simplification initiative. simplification initiative. St k h ld ld b i di id l itiSt k h ld ld b i di id l itiStakeholders could be individual citizens or owners Stakeholders could be individual citizens or owners of businesses having strong interest in using the of businesses having strong interest in using the proposed regulatory process for better results andproposed regulatory process for better results andproposed regulatory process for better results and proposed regulatory process for better results and for positive outcome on the simplification initiative.for positive outcome on the simplification initiative.

Involve Stakeholders through Consultations Involve Stakeholders through Consultations (Cont…)(Cont…)(Cont…)(Cont…)

More importantly, from a political perspective, More importantly, from a political perspective, consultations accommodate the desire of stakeholdersconsultations accommodate the desire of stakeholdersconsultations accommodate the desire of stakeholders consultations accommodate the desire of stakeholders to be consulted about new processes. to be consulted about new processes. This should be done at all stages of the simplification This should be done at all stages of the simplification g pg preforms reforms –– starting from initial design, implementation starting from initial design, implementation to the evaluation of the whole process. to the evaluation of the whole process. Such approach reflects a commitment to democratic Such approach reflects a commitment to democratic values, and provides a means to validate the policy values, and provides a means to validate the policy choices in the investment code that has beenchoices in the investment code that has beenchoices in the investment code that has been choices in the investment code that has been harmonized as well as validate the methods chosen to harmonized as well as validate the methods chosen to provide a framework for the application of consultation provide a framework for the application of consultation p ppp ppmechanisms. mechanisms. The ECOWAS Commission should consider adopting a The ECOWAS Commission should consider adopting a formal formal Consultation PolicyConsultation Policy on common investment on common investment market benchmarking and monitoringmarket benchmarking and monitoring

7.7. Finalize the Reform Implementation Finalize the Reform Implementation PlPlPlanPlan

As may be expected, any legislative or administrative As may be expected, any legislative or administrative initiative will rarely proceed “as planned ”initiative will rarely proceed “as planned ”initiative will rarely proceed as planned. initiative will rarely proceed as planned. Unforeseen political or technical events intervene and Unforeseen political or technical events intervene and require adjustments to proposed process changes or require adjustments to proposed process changes or timetablestimetablestimetables. timetables. As the design phase of ECOWAS investment policy As the design phase of ECOWAS investment policy harmonization ends and implementation begins, the harmonization ends and implementation begins, the p g ,p g ,regional regional implementation team led by the Private implementation team led by the Private Sector DepartmentSector Department should :should :

a)a) ensure that outstanding issues are managedensure that outstanding issues are manageda)a) ensure that outstanding issues are managed, ensure that outstanding issues are managed, periodically reviewed, and resolved;periodically reviewed, and resolved;

b)b) ensure that people with decisionensure that people with decision--making authority make making authority make the necessary decisions to resolve issues as promptly asthe necessary decisions to resolve issues as promptly asthe necessary decisions to resolve issues as promptly as the necessary decisions to resolve issues as promptly as possible;possible;

c)c) ensure, where issues have been resolved , that the ensure, where issues have been resolved , that the , ,, ,result is reflected in the process design and result is reflected in the process design and communications plan;communications plan;

Finalize the Reform Implementation Plan Finalize the Reform Implementation Plan (Cont )(Cont )(Cont…)(Cont…)

d)d) ensure that residual/outstanding risks have been ensure that residual/outstanding risks have been identified and documented for tracking with eachidentified and documented for tracking with eachidentified and documented for tracking with each identified and documented for tracking with each aspect of the simplification initiative being examined aspect of the simplification initiative being examined for risks;for risks;

e)e) construct a contingency plan and strategy for each construct a contingency plan and strategy for each identified risk;identified risk;

f)f) determine if any testing is required (e g indetermine if any testing is required (e g inf)f) determine if any testing is required (e.g., in determine if any testing is required (e.g., in connection with the deployment of any technology);connection with the deployment of any technology);

g)g) ensure that dates have been applied to all tasks (e.g.,ensure that dates have been applied to all tasks (e.g.,g)g) ensure that dates have been applied to all tasks (e.g., ensure that dates have been applied to all tasks (e.g., training) and that schedules have been updated;training) and that schedules have been updated;

h)h) plan a plan a “dry run”“dry run” of the new regulatory process;of the new regulatory process;i)i) communicate changes in the Implementation Plan to communicate changes in the Implementation Plan to

those involved in the implementation phase; andthose involved in the implementation phase; andj)j) communicate the revised schedule to externalcommunicate the revised schedule to externalj)j) communicate the revised schedule to external communicate the revised schedule to external

stakeholders if changes are required in dates, stakeholders if changes are required in dates, resources and on other constraints.resources and on other constraints.

C.C. ImplementationImplementationIn order for the Investment Code process to be In order for the Investment Code process to be

effective, effective, “front line”“front line” staff or the national and staff or the national and regional agencies to implement it need to not only regional agencies to implement it need to not only know how it will work but also be in the position to know how it will work but also be in the position to make it work This requires the following:make it work This requires the following:make it work. This requires the following:make it work. This requires the following:

11 Develop Operations ManualDevelop Operations Manual1.1. Develop Operations Manual Develop Operations Manual To assist regional staff in performing their dayTo assist regional staff in performing their day--toto--day ”frontday ”front--line” operations once investment policyline” operations once investment policyday frontday front line operations once investment policy line operations once investment policy harmonisation and rules simplification reforms harmonisation and rules simplification reforms have been undertaken, an have been undertaken, an Operations ManualOperations Manualshould be developed that clearly summarises theshould be developed that clearly summarises theshould be developed that clearly summarises the should be developed that clearly summarises the new policies, processes and procedures.new policies, processes and procedures.The Manual should be tailored to the specificThe Manual should be tailored to the specificThe Manual should be tailored to the specific The Manual should be tailored to the specific initiative being undertaken. initiative being undertaken.

Develop Operations Manual (Cont…)Develop Operations Manual (Cont…)p p ( )p p ( )

An Operations Manual serves as a functional An Operations Manual serves as a functional pp“quick reference” guide for staff as well as a key “quick reference” guide for staff as well as a key training tool for the staff members. training tool for the staff members. ggA wellA well--structured Operations Manual is a key structured Operations Manual is a key part of creating an efficient and effectivepart of creating an efficient and effectivepart of creating an efficient and effective part of creating an efficient and effective business system. business system. The Operations Manual should be user friendlyThe Operations Manual should be user friendlyThe Operations Manual should be user friendly, The Operations Manual should be user friendly, contain graphical depictions of specific contain graphical depictions of specific procedures (i e flow charts) standard formsprocedures (i e flow charts) standard formsprocedures (i.e. flow charts), standard forms procedures (i.e. flow charts), standard forms and examples of completed forms, and a and examples of completed forms, and a detailed indexdetailed indexdetailed index. detailed index.

2.2. Train Employees at National and Train Employees at National and Regional Investment AgenciesRegional Investment AgenciesRegional Investment AgenciesRegional Investment Agencies

Implementing a design process should involve training Implementing a design process should involve training i th ti d i i t ti d i t fi th ti d i i t ti d i t fin the operation, administration, and maintenance of in the operation, administration, and maintenance of the new process. the new process. In order for the regulatory process to be effective andIn order for the regulatory process to be effective andIn order for the regulatory process to be effective, and In order for the regulatory process to be effective, and depending on the degree of changes involved, “frontdepending on the degree of changes involved, “front--line” staff need not only to know “how” the process line” staff need not only to know “how” the process works but also to be in a position to answer questionsworks but also to be in a position to answer questionsworks but also to be in a position to answer questions works but also to be in a position to answer questions from investors into ECOWAS region about how the from investors into ECOWAS region about how the changes affect them. changes affect them. Training should be incorporated into the Training should be incorporated into the Implementation Plan and considered from three Implementation Plan and considered from three perspectives:perspectives: the staff of Private Sector Department thatthe staff of Private Sector Department thatperspectives: perspectives: the staff of Private Sector Department that the staff of Private Sector Department that are in charge in Investment as a whole; the are in charge in Investment as a whole; the characteristics of the relevant positions; and the needs of characteristics of the relevant positions; and the needs of the individuals who hold or will hold those positionsthe individuals who hold or will hold those positionsthe individuals who hold or will hold those positions.the individuals who hold or will hold those positions.

Train Employees at National and Regional Train Employees at National and Regional Investment Agencies (Cont…)Investment Agencies (Cont…)

An important consideration is getting stakeholders toAn important consideration is getting stakeholders toAn important consideration is getting stakeholders to An important consideration is getting stakeholders to understand understand why the why the change is necessary, change is necessary, what what the the outcome will be,outcome will be, howhow things will change, andthings will change, and wherewhereoutcome will be, outcome will be, how how things will change, and things will change, and where where they stand in any simplification initiative. they stand in any simplification initiative. Training serves as a vehicle to informTraining serves as a vehicle to inform allall managersmanagersTraining serves as a vehicle to inform Training serves as a vehicle to inform all all managers managers and employees on the final process design choices and employees on the final process design choices and on their respective roles and responsibilities. It and on their respective roles and responsibilities. It p pp phelps them to understand how things will change and helps them to understand how things will change and where they stand.where they stand.Training programme will be designed by the Training programme will be designed by the consultant and it will be made available to all the consultant and it will be made available to all the regional stakeholdersregional stakeholders

3.3. Make the Process Accessible and Make the Process Accessible and C i tC i t A R i l OA R i l O St ShSt ShConvenient Convenient –– A Regional OneA Regional One--Stop ShopStop Shop

The major problems in any regulatory process, The major problems in any regulatory process, i l di ffi i l i t ti ll l t di l di ffi i l i t ti ll l t dincluding official registration, are normally related including official registration, are normally related to the complexity of the process and the length of to the complexity of the process and the length of time it takes to process applicationstime it takes to process applicationstime it takes to process applications. time it takes to process applications. In order for any regulatory process to appeal to a In order for any regulatory process to appeal to a large number of users, it must be easily accessible large number of users, it must be easily accessible g , yg , yand responsive. and responsive. Achieving this objective involves consideration of Achieving this objective involves consideration of thth h i l l tih i l l ti f Thif Thithe the physical location physical location of any process. This of any process. This necessitates: necessitates: (1) creating central access points and(1) creating central access points and(1) creating central access points and(1) creating central access points and2) promoting greater accessibility through 2) promoting greater accessibility through “multiple” central access points at regional and“multiple” central access points at regional andmultiple central access points at regional and multiple central access points at regional and national levels.national levels.

Make the Process Accessible and Convenient Make the Process Accessible and Convenient –– A Regional OneA Regional One--Stop Shop (Cont…)Stop Shop (Cont…)

Often associated with simplification efforts andOften associated with simplification efforts andOften associated with simplification efforts and Often associated with simplification efforts and successful in a number of countries, these access successful in a number of countries, these access points are commonly known as “Onepoints are commonly known as “One--Stop Stop p yp y ppShops”.Shops”.An important caveat to note is that the creation An important caveat to note is that the creation ppof access points without an associated of access points without an associated simplification of policy or processes may simply simplification of policy or processes may simply p p y p y p yp p y p y p ycreate another level of bureaucracy.create another level of bureaucracy.The above arguments justify the fundamental The above arguments justify the fundamental g j yg j ystrengthening of the Private Sector Department strengthening of the Private Sector Department along with the National IPAsalong with the National IPAs

4.4. Communicate to Investors and Communicate to Investors and Regional StakeholdersRegional StakeholdersRegional StakeholdersRegional Stakeholders

Meaningful communication between the ECOWAS Meaningful communication between the ECOWAS Commission and stakeholders on investmentCommission and stakeholders on investmentCommission and stakeholders on investment Commission and stakeholders on investment harmonisation can results in a stronger, more harmonisation can results in a stronger, more effective regulatory process, since it permits the effective regulatory process, since it permits the g y p , pg y p , pregion to:region to:Ensure awareness, understanding and transparency;Ensure awareness, understanding and transparency;Develop relationships with stakeholders;Develop relationships with stakeholders;Reduce the regulatory agencies and investors Reduce the regulatory agencies and investors concerns and misunderstanding about the Code; andconcerns and misunderstanding about the Code; andManage employee, stakeholder and public Manage employee, stakeholder and public

t ti b ttt ti b ttexpectations better.expectations better.An important element in ECOWAS investment policy An important element in ECOWAS investment policy and rules simplification initiatives is addressing theand rules simplification initiatives is addressing theand rules simplification initiatives is addressing the and rules simplification initiatives is addressing the issue of resistance to change.issue of resistance to change.

Communicate to Investors and regional Communicate to Investors and regional Employees (Cont )Employees (Cont )Employees (Cont..)Employees (Cont..)

Both internal participants (employees, managers, Both internal participants (employees, managers, directors of the ECOWAS Commission) and externaldirectors of the ECOWAS Commission) and externaldirectors of the ECOWAS Commission) and external directors of the ECOWAS Commission) and external stakeholders (citizens, businesses, funding stakeholders (citizens, businesses, funding institutions) are interested in the outcome andinstitutions) are interested in the outcome andinstitutions) are interested in the outcome and institutions) are interested in the outcome and want to know want to know on an onon an on--going basis going basis about the about the initiative and how it may affect theminitiative and how it may affect them whether itwhether itinitiative and how it may affect them initiative and how it may affect them ---- whether it whether it provides benefits or creates obligations. provides benefits or creates obligations. O ll i h d b i i hO ll i h d b i i hOverall support is enhanced by communicating the Overall support is enhanced by communicating the benefits via published periodicals. benefits via published periodicals. Accordingly, Accordingly, a communications strategya communications strategy is an is an important component of investment simplification important component of investment simplification implementation process.implementation process.

5.5. Organize Public Relation EventsOrganize Public Relation Events

The importance of communicating the commonThe importance of communicating the commonThe importance of communicating the common The importance of communicating the common investment market initiative to internal and external investment market initiative to internal and external stakeholders cannot be overstated.stakeholders cannot be overstated.stakeholders cannot be overstated.stakeholders cannot be overstated.Regional and National Officials implementing the Code Regional and National Officials implementing the Code should organize public relation events aimed at should organize public relation events aimed at g pg penlightening the stakeholders especially investors enlightening the stakeholders especially investors within ECOWAS as well as at overseas countries within ECOWAS as well as at overseas countries (through liaising with the regional embassies abroad of(through liaising with the regional embassies abroad of(through liaising with the regional embassies abroad of (through liaising with the regional embassies abroad of ECOWAS countries).ECOWAS countries).Engaging in such an event will also benefit theEngaging in such an event will also benefit theEngaging in such an event will also benefit the Engaging in such an event will also benefit the Community by raising awareness of the investment Community by raising awareness of the investment simplified process which may further draw more simplified process which may further draw more p p yp p ybusiness owners to become part of the initiative.business owners to become part of the initiative.Seminar can be organized where all interested business Seminar can be organized where all interested business

l d b l b hl d b l b hpeople and business owners can learn about the new people and business owners can learn about the new process; and such event should be publicized in media.process; and such event should be publicized in media.

D.D. EvaluationEvaluationThe completion of the implementation The completion of the implementation phase concludes the transitionphase concludes the transition from ”old”from ”old”phase concludes the transition phase concludes the transition from ”old” from ”old” to “new”to “new” processes but not the end of processes but not the end of the simplification and harmonization the simplification and harmonization initiative. initiative. The evaluation phase is intended to The evaluation phase is intended to measure the effectiveness of the processmeasure the effectiveness of the processmeasure the effectiveness of the process measure the effectiveness of the process changes. The salient features of this changes. The salient features of this h l b d i hi ih l b d i hi iphase are elaborated upon in this section phase are elaborated upon in this section

below.below.

1.1. Prepare PostPrepare Post--Initiative Assessment Initiative Assessment R tR tReportReport

Th E l ti Ph h ld b i ithTh E l ti Ph h ld b i ith PostPostThe Evaluation Phase should begin with a The Evaluation Phase should begin with a PostPost--Initiative Assessment ReportInitiative Assessment Report, which examines , which examines and documents the initiative’s outcomes, whetherand documents the initiative’s outcomes, whetherand documents the initiative s outcomes, whether and documents the initiative s outcomes, whether the original objectives were met, and how effective the original objectives were met, and how effective the management practices were in keeping the the management practices were in keeping the project on trackproject on trackproject on track. project on track. A timely and comprehensive PostA timely and comprehensive Post--Initiative Initiative Assessment Report will identify ongoing issues toAssessment Report will identify ongoing issues toAssessment Report will identify ongoing issues to Assessment Report will identify ongoing issues to monitor as well as to provide some “lessons monitor as well as to provide some “lessons learned” to assist officials and stakeholders in learned” to assist officials and stakeholders in l d f ll d f lplanning and managing future regulatory planning and managing future regulatory

simplification projects.simplification projects.

Prepare PostPrepare Post--Initiative Assessment Report (Cont....)Initiative Assessment Report (Cont....)

The preparation of this report, preferably by a third The preparation of this report, preferably by a third party should occur within an appropriate period ofparty should occur within an appropriate period ofparty, should occur within an appropriate period of party, should occur within an appropriate period of time following the implementation of the designed time following the implementation of the designed process.process.process. process. Interviews and investor surveys are two tools to Interviews and investor surveys are two tools to consider when gauging views on the revised consider when gauging views on the revised co s de e gaug g e s o t e e sedco s de e gaug g e s o t e e sedprocess. process. In addition to formal reviews, In addition to formal reviews, the project the project add t o to o a e e s,add t o to o a e e s, t e p ojectt e p ojectimplementation teamimplementation team should observe the should observe the implementation of the initiative on a dayimplementation of the initiative on a day--toto--day day basis to determine whether any finebasis to determine whether any fine--tuning of the tuning of the process may be required accordingly.process may be required accordingly.The PostThe Post--Initiative Assessment Report should focus Initiative Assessment Report should focus on two key aspects:on two key aspects:

Prepare PostPrepare Post--Initiative Assessment Report (Cont....)Initiative Assessment Report (Cont....)

-- A “gap analysisA “gap analysis” examining the differences between ” examining the differences between the planned requirements, schedule, and budget and the planned requirements, schedule, and budget and what actually resulted when it occurred and the degreewhat actually resulted when it occurred and the degreewhat actually resulted, when it occurred and the degree what actually resulted, when it occurred and the degree of deviation from the plan;of deviation from the plan;-- A “lessons learned” exerciseA “lessons learned” exercise for collection andfor collection andA lessons learned exerciseA lessons learned exercise for collection and for collection and analysis of feedback on events that happened during the analysis of feedback on events that happened during the initiative. initiative. It provides an opportunity to discuss things that It provides an opportunity to discuss things that happened during or because of the initiative: successes, happened during or because of the initiative: successes, unanticipated or unintended outcomes and possibleunanticipated or unintended outcomes and possibleunanticipated or unintended outcomes and possible unanticipated or unintended outcomes and possible alternatives (i.e., how things might have been done alternatives (i.e., how things might have been done differently). differently). y)y)A major source of such information should be ultimate A major source of such information should be ultimate beneficiaries of these reforms beneficiaries of these reforms –– entrepreneurs. The focus entrepreneurs. The focus h ld b b h i t ti th th thh ld b b h i t ti th th thshould be on behaviours or tactics rather than on the should be on behaviours or tactics rather than on the

actions of individuals.actions of individuals.

2.2. PostPost--Implementation EvaluationImplementation EvaluationThere are three specific points in time where a measurement There are three specific points in time where a measurement of performance indicators should be made. As previously of performance indicators should be made. As previously noted,noted, the firstthe first is at the diagnosis phase when the existingis at the diagnosis phase when the existingnoted, noted, the firstthe first is at the diagnosis phase when the existing is at the diagnosis phase when the existing regulatory process managed by national investment regulatory regulatory process managed by national investment regulatory agencies in various ECOWAS countries are initially mapped. agencies in various ECOWAS countries are initially mapped. The secondThe second measurement should occur when results can ormeasurement should occur when results can orThe secondThe second measurement should occur when results can or measurement should occur when results can or should be expected following the implementation of the should be expected following the implementation of the designed, simplified process of investment harmonization to designed, simplified process of investment harmonization to become one codebecome one codebecome one code. become one code. This measurement is intended to determine whether the This measurement is intended to determine whether the changes made have actually resulted in any improvements. changes made have actually resulted in any improvements. Th thi dTh thi d t dit f ti dt dit f ti dThe thirdThe third measurement serves as an audit function and may measurement serves as an audit function and may occur after the implementation of the simplified process. occur after the implementation of the simplified process. This audit is intended to ascertain whether there has been any This audit is intended to ascertain whether there has been any yydeterioration in performance since the completion of the deterioration in performance since the completion of the simplification initiative and may also uncover steps or simplification initiative and may also uncover steps or requirements that have been reintroduced into the ECOWAS requirements that have been reintroduced into the ECOWAS qqinvestment harmonisation regulatory process.investment harmonisation regulatory process.

PostPost--Implementation Evaluation (Cont…)Implementation Evaluation (Cont…)Two key indicators may shed light on the degree of achievements Two key indicators may shed light on the degree of achievements or failures:or failures:Percentage Increase in Regional Investment InflowPercentage Increase in Regional Investment Inflowg gg gThe percentage change in regional revenue as measured by a The percentage change in regional revenue as measured by a comparison of total regional fee revenue associated with a comparison of total regional fee revenue associated with a regulatory process in a fixed period following the implementation regulatory process in a fixed period following the implementation egu ato y p ocess a ed pe od o o g t e p e e tat oegu ato y p ocess a ed pe od o o g t e p e e tat oof changes resulting from the simplification of investment of changes resulting from the simplification of investment initiative with the corresponding period immediately preceding initiative with the corresponding period immediately preceding the implementation of changes. the implementation of changes. p gp gPercentage Increase in CompliancePercentage Increase in ComplianceThe percentage change in investors as measured by a The percentage change in investors as measured by a comparison of the total number of investors and domesticcomparison of the total number of investors and domesticcomparison of the total number of investors and domestic comparison of the total number of investors and domestic business people filing request in connection with a regulatory business people filing request in connection with a regulatory process in a fixed period immediately following the process in a fixed period immediately following the implementation of changes resulting from the simplification implementation of changes resulting from the simplification p g g pp g g pinitiative with the corresponding period immediately preceding initiative with the corresponding period immediately preceding the implementation of changes.the implementation of changes.Reducing the time or cost of the regulatory process for investors Reducing the time or cost of the regulatory process for investors g g y pg g y pcontributes to increasing compliance. The higher the number, the contributes to increasing compliance. The higher the number, the more successful is the simplification initiativemore successful is the simplification initiative..

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