The First OECD- Southeast Asia Regional Forum 2007 Session 2

1. The First OECD- Southeast Asia Regional Forum 2007 Session 2 Presentation for Conference on Peer Review ProcessesJakarta, 23-24 January 2007Val Koromzay OECD, Head of Country Studies

2. The EDRC Review Process Basic message: The EDRC’s Peer review process has a number of strengths, both formal and institutional. It is continuing to evolve and, at least in my view, to improve. Even so, there are clear limits to what any such process can achieve, though these limits can be raised over time. The EDRC experience provides some lessons for other Peer Review Processes. Structure of presentation: • Part 1: How does the EDRC work? The formal and institutional context • Part 2: Does EDRC have an impact on policy? • Part 3: Does EDRC provide lessons for peer review processes in other contexts?

3. How EDRC Works: formal and institutional aspects Key formal elements There are no agreed legal instruments or rules (other than procedural rules) to underpin the review process. Commitments are only to certain elements of process: -- Regular periodicity -- Publication of surveys -- The principle that “nothing is off the table”: a) Origin b) Importance How to choose topics to cover?

4. Institutional Elements: In the absence of substantive rules, where do OECD recommendations get their legitimacy? A) Importance of broader OECD institutional context: link to Economic Policy Committee B) Role of OECD Secretariat: the challenge of “horizontal consistency” C) The role of country missions to prepare the draft surveys

5. Key issue: to what extent is a shared economic “ideology” essential for a review process to work? -- Obviously, the greater the degree of “like mindedness" the easier it is to reach agreement on strong recommendations -- But there is substantial cultural, social and economic heterogeneity among OECD countries. “One size fits all” doesn’t work. -- Even so, substantial common ground can often be found. a) The importance of “evidence-based” policy- making as a shared concept. b) Clear identification of real trade-offs: “efficiency versus equity” c) How to deal with issues that are just not on the political agenda -- Is the EDRC a mouth piece for any particular version of liberal capitalism?

6. What is the impact of the EDRC process? A) Formal attempts to assess -- OECD’s impact assessment exercise -- Progress in Structural Reform Annex B) Direct evidence: heterogeneous results -- When it works best: some examples -- When it has least effect: examples C) Immediate versus longer-term results: Does the EDRC process help to shape the evolution of policy-thinking? D) The way forward: dissemination models

7. Lessons/Issues for other review processes A) Technical perceived quality of the draft surveys is a sine qua non. B) “Legalistic” versus “political commitment” approaches to the review process. -- May depend on circumstances, but don’t underestimate the benefits of a flexible, not fully binding approach C) Degree of ambition: don’t overreach; but seize opportunities to move forward D) The role of Committee Members: development of a review culture E) The EDRC’s “Principles and practices”: the crucible for measuring progress