OECD Secretary-General

Launch of three OECD Reviews in the context of Colombia’s OECD Accession Process


Remarks by Angel Gurría, OECD Secretary-General

Bogotá, Colombia, 25 October 2013

Mr President, Ministers, Ladies and Gentlemen,

It is a pleasure to be here in the presence of President Santos to present three reviews which are indicative of the fruitful partnership between Colombia and the OECD. The first of these reviews relates to public governance, the second to regulatory reform and the third to Colombia’s innovation policy.

This presentation is particularly significant because it coincides with the launch of Colombia’s OECD accession process. Today, we are unleashing the process set out in the roadmap.

The seriousness with which the Government of Colombia is striving to adopt the standards and practices of the OECD is amply reflected in these three reviews, which I shall comment on later, on the understanding that it will be OECD experts who will later discuss the main conclusions and recommendations with you.

Public governance reform

The Public Governance Review, that benefited from the extremely valuable financial support of USAID, focuses on an assessment of the Colombian Government’s Governance Reform Programme, which seeks to ensure that public decision‑making reflects the needs of citizens. The review examines government mechanisms for co‑ordinating and implementing national development strategy, controlling public spending and co‑operating with the departments in order to give coherence to development efforts at regional and national level.

Colombia has made great strides in reforming its public governance since the adoption of the 1991 Political Constitution. Today, thanks to successive waves of reforms undertaken by the Government, Colombians now have a strong multi-year strategic planning system which focuses on equitable and sustainable development across all regions. National Development Plans are the subject of extensive public consultations across the country and are approved by the Congress. As a result, each Plan reflects a solid national consensus on the direction the country should take.

The Government of Colombia is equipped with robust systems for assessing performance and for communicating to its citizens the progress made in implementing policies. The practices adopted by Colombia are above the Latin American average and are regarded as advanced according to OECD standards. The Urna de Cristal web portal, for instance, is a remarkable tool, not only for sharing information with the public but also for engaging citizens on how to improve policy.

The Colombian budget system has been modernised, and the new standard for controlling public spending has been adopted in accordance with OECD guidelines.

Despite this progress, there are still some areas where there is room for improvement. First, it is necessary to strengthen policy co‑ordination across all levels of government, by reducing overlap and duplication of activities, especially in the audit and control system.

Improving co‑ordination with subnational authorities to enhance the impact of policies is also crucial. In this context, it will be necessary to take into account regional disparities in the quality and availability of basic services and to strengthen capacities at subregional level.

Colombia also needs to enhance its multi-year planning to ensure that National Development Plans reflect emerging, long-term domestic and international trends and challenges. For this purpose, Colombia will require effective multi-year performance-based budget frameworks that link short-term spending decisions to the achievement of results over time.

These are some of our recommendations to enable the Government of Colombia to modernise its own processes and practices.

Regulatory policy reform

A robust regulatory environment is essential for promoting strong, fair and sustainable growth. Efforts to make regulations more consistent, to reduce unnecessary costs for economic operators and to facilitate access to markets and the sale of businesses can all have a positive impact on a country’s economy.

This review has focused on Colombia’s approach to regulatory policy; the regulations adopted have actively promoted quality requirements for preparing and implementing policies and have tried to eliminate unnecessary bureaucracy and formalities affecting the business community and citizens.

Colombia has also made significant efforts to improve regulatory transparency. However, the Government needs to adopt standardised tools in order to improve still further the transparency of its regulatory policy, beyond its Single System of Formalities Information (SUIT).

Colombia also requires an oversight body to co‑ordinate regulatory policy at all levels of government. The experience of other OECD member countries shows that this type of reform has to be led by a dedicated institution, at the heart of government, with a clear mandate. We know that the Government is already discussing this issue, which illustrates the high political priority given to it and demonstrates the seriousness with which Colombia is pursuing its regulatory reform agenda.

Last but not least, I come to our Review of Innovation Policy which is vital not just for Colombia but for the whole of Latin America.

Innovation policy

In the innovation review, we examined government policy aimed at sustaining growth and ensuring that Colombia’s international competitiveness is based on agriculture in addition to manufacturing and internationally tradable services.

The innovation system of Colombia is still small because it lacks a powerful business core. Research and development (R&D) expenditure is only 0.2% of GDP, compared to 1.2% in Brazil and 2.4% in the OECD.

Despite this, Colombia has made significant progress in terms of innovation by adopting a commitment at the highest level to strengthen innovation as a driver of sustainable and inclusive development. Likewise, it has continued to improve framework conditions for innovation, particularly in the field of education and ICT infrastructure.

The new system for distributing royalties from non‑renewable natural resources allocates 10% of revenues to a science, technology and innovation fund. This presents a unique opportunity for action, and the OECD review makes three key recommendations for seizing this opportunity.

First, place business at the core of the innovation system. Only 30% of all R&D activity is performed by Colombian enterprises, compared with 50% in Brazil and 65%‑75% in leading OECD countries in this field. The business sector is the cornerstone of the most effective innovation systems, and so it is crucial to help enterprises build their innovation capacity. Our review provides appropriate recommendations in this respect.

Second, invest in knowledge and skills. Although access to and the quality of secondary education have improved and higher education has expanded, the education system needs further development. More attention should therefore be given to mid‑level – often technical – skills which are important for building innovation capacity. The contribution of Colombian universities to education also needs to be enhanced. It will therefore be necessary to promote institutional capacity-building, develop centres of excellence and encourage universities to develop their own innovation strategies.

Third, improve innovation policy and its governance. Colombia is already making investments in innovation. If well managed, increased funding will consolidate the country’s innovation system and correct the current imbalances between public and private innovation, and the disparities between regions. Strengthening the evidence base for policy‑making will also be necessary, as will effective accounting, backed by improved monitoring and assessment.

As suggested in our Public Governance Review, all this will require effective governance mechanisms: better horizontal co‑ordination of the machinery of government and better multi-level governance, from central government through to subnational authorities. It will be necessary to focus on strengthening subnational capacity in order to undertake innovation projects which boost local potential.

President Santos, Ministers, Ladies and Gentlemen:

The effort made by Colombia to meet best international practices is bearing fruit. The reviews that we are presenting today are a clear example of the type of benefits that Colombia will derive from its accession to the OECD. They are also a testament to the vision shown by President Santos’s Government in promoting best practices in these areas through closer association with the OECD.

Let us continue working together to design, promote and implement better public policies for better lives for all Colombians.

Thank you very much.