Under the work programme with Middle East and North African countries (MENA), the second meeting of the OECD-MENA Senior Budget Officials network was hosted by the Qatari authorities and held in Doha, Qatar, on 4-5 November 2009, The meeting was chaired by Mr Bader Al Emadi AlQayed, Director of the Public Audit Department and Vice-Chairman of the State Finance Committee, Ministry of Finance, Qatar. The co-chair of the meeting was Mr. Marten Blix, Director, Ministry of Finance, Sweden.
As requested by delegates to its first meeting in Cairo last November, the second meeting focused on various aspects of the present economic and financial crisis. The nature of problems created by the crisis and its policy responses in various countries were of course important. Even more immediately relevant for SBOs was how various countries are handling exit questions as the crisis abates, and notably how it is envisaged to return to a sustainable fiscal position and how the crisis has revealed needs for improvement in structures and processes of budgeting. The challenges exacerbated by the crisis concern off-budget commitments and entities, contingent liabilities, flexibility in budgetary management in a volatile environment, etc.
Wednesday 4 November 2009
After welcoming remarks by the Qatari and OECD authorities and greetings from Mr Hany Dimian, Vice-Minister of Finance, Egypt, and chair of the predecessor group to MENA SBO, Qatar gave a presentation on its response to the crisis and plans for its aftermath:
Speaker: H.E. Mr Yousif Hussin Kamal, Minister of Finance, Qatar.
Session 1: The crisis and the responses to it: huge diversity between countries in spite of common features.
The speed and reach of the crisis internationally has obscured the diversity of problems it has created in various countries. The responses to the crisis have of course correspondingly diverged. The problems and solutions in major large economies have been abundantly reported on and discussed. This session focused on less well-known examples of the impacts and reactions to the crisis in central and eastern Europe where many conditions close to those of MENA countries prevailed, notably on questions of debt and access to capital markets.
Dr Zsolt Darvas, Research Fellow at Bruegel (Brussels European and Global Economic Laboratory): The Impact of the Crisis on Budget Policy in Central and Eastern Europe
Mr. Abdellatif Bennani, Budget Director, Ministry of Finance, Morocco.
Session 2: The budgetary management of the policy responses to the crisis: reconciling spending speed and flexibility with the efficiency and effectiveness objectives of the budget office.
The first challenge to surface during the crisis for budget offices has been to find ways to respond to the call for fast disbursements of large additional sums without forsaking traditional objectives in integrity and legality of expenditures. How was it done? Was it also possible to at least keep an eye on the efficiency and effectiveness of these hoped for rapid outlays? How?
Mrs. Elena Martin Cordova, Minsitry of Finance, Spain: Dealing with a change in the economic growth pattern, high unemployment and the need for fiscal sustainability.
Dr. Metri Mdanat, Senior Economic Policy Adviser, Minsitry of Finance, Jordan: Mastering the policy response and its consequences in Jordan.
Session 3: Information and discussion session on MENA-SBO organization, its relation to OECD and its financing.
Speaker: Mr. Carlos Conde, OECD Senior Programme Coordinator, MENA.
Thursday 5 November 2009:
Session 4: The policy responses to the crisis, its medium term consequences and their budgetary management
Exiting the crisis, budget offices will have to deal with issues which are reasonably clear by now: debt control and reduction, clawback of tax breaks, getting reimbursed for bridge loans and other emergency measures, etc. This action will be against a perilous backdrop of not killing a fragile recovery by a premature tightening. Overall, this will take years. In the meantime, budgets have to be produced. What will need to change to fulfill both tasks?
Dr. Elsayed Mousa Elsamadisy, Senior Economist and Monetary Policy Expert, Department of Research and monetary Policy, Qatar Central Bank: Managing the crisis in Qatar.
Dr Gerhard Steger, Budget Director, Ministry of Finance, Austria, and Chair of the OECD SBO: Budgeting under and beyond the stimulus: lessons learned.
Session 5: Tax expenditures: a revival of interest and hopefully real action?
The crisis has involved a massive expansion of tax expenditures in many countries. In parallel and probably as a consequence of the crisis, there is a substantial renewal of interest internationally in finding a more effective integration of tax expenditures within the decision processes and disciplines of the expenditures budget. The key underlying question for all budget offices is whether and how tax expenditures can truly be integrated into a comprehensive expenditure policy framework, years after a first attempt internationally essentially failed.
Mr. Said Mifdal, Head of Recovery and Forecasting Division, General Tax Directorate, Ministry of Finance, Morocco: The Moroccan experience in assessing tax expenditures.
Dr François Lacasse, University of Québec, Consultant to OECD/GOV: Tax expenditures: new action and new thinking in OECD countries, their relevance for MENA countries.
Session 6: Synthesis
This session has been devoted to a) questions which haven't been handled inb the thematic ones on the crisis and tax expenditures; b) recommendations, decisions and suggestions by delegates on the future of MENS-SBO: its structures, its operating rules and its financing.