Page 14 - DIALOGUE FOR DEVELOPMENT №2
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ined mechanisms for interagency coordination and harmonization. As a result of the
duplication of functions/powers and competences, the intersection leads to a blurring of
responsibility for achieving the outcomes and responsibility of consequences of
decisions. Therefore, it is necessary to create a structure that would stand in the
hierarchy above all the ministries and departments responsible for the implementation
of reforms and national development plans of the country. Establishment of the National
Development Council and the Consultative Council on improvement of investment
climate facilitates the dialogue mechanism of development partners. However, these
bodies, themselves are not able to provide an improvement of the current inter-agency
coordination of development policies.
There is a monopoly of the state bodies and organizations on a range of services and
functions. Responsibilities of the private and public sectors, as well as the structure of
state bodies and institutions should be reviewed. Ministries should be completely
abandoned in functions of "economic activity" in any form. It is necessary to eliminate
the state unitary enterprises (SUE) that are currently receiving significant support from
the state budget and non-tax payments, while their efficiency is almost zero, and they
practically do not report to anybody. SUE’s system kills competition and private
business. Without this measure, it will be virtually impossible to expect growth of
domestic producers and the development of entrepreneurship.
Analysis and monitoring of activities of ministries and departments of the country over
the past years demonstrated, that at present, virtually no consolidated and common
indicators that objectively assess, on the one hand, the socio-economic situation in the
country, and on the other, the activities of public authorities responsible for the
implementation of macroeconomic policies. As a result, economic actors (households,
firms and the government) have different perceptions of economic trends in the country
and their economic expectations are beginning to contradict to each other, which
hinders, sometimes, a negative impact on economic growth. The relevant ministries,
economic research institutes of the Academy of Sciences and economic universities
and institutions should assist the Government in developing the principles of preventive
macroeconomic policy, which is based on proactive measures to reduce the risks
affecting the results of operations. To do this, it is necessary to start calculating the
index (indices) to objectively assess the short-, medium- and long-term trends in the
development of the country. In a market system, which has not yet developed the stock,
currency, credit and other markets, such indexes should be of informative nature
(published quarterly) and to give everyone the opportunity to make independent
economic entities, i.e. rational, and therefore the optimal economic decisions. This will
reduce the importance of subjective approaches taken by government agencies and
economic solutions to enhance the role of civil society in making such decisions. The
decisions taken during such policy, in addition to traditional indicators should be based
on the following indices (i.e. aggregates):
1) Macroeconomic unit
- An index of business confidence (or PMI)
- Consumer sentiment index
duplication of functions/powers and competences, the intersection leads to a blurring of
responsibility for achieving the outcomes and responsibility of consequences of
decisions. Therefore, it is necessary to create a structure that would stand in the
hierarchy above all the ministries and departments responsible for the implementation
of reforms and national development plans of the country. Establishment of the National
Development Council and the Consultative Council on improvement of investment
climate facilitates the dialogue mechanism of development partners. However, these
bodies, themselves are not able to provide an improvement of the current inter-agency
coordination of development policies.
There is a monopoly of the state bodies and organizations on a range of services and
functions. Responsibilities of the private and public sectors, as well as the structure of
state bodies and institutions should be reviewed. Ministries should be completely
abandoned in functions of "economic activity" in any form. It is necessary to eliminate
the state unitary enterprises (SUE) that are currently receiving significant support from
the state budget and non-tax payments, while their efficiency is almost zero, and they
practically do not report to anybody. SUE’s system kills competition and private
business. Without this measure, it will be virtually impossible to expect growth of
domestic producers and the development of entrepreneurship.
Analysis and monitoring of activities of ministries and departments of the country over
the past years demonstrated, that at present, virtually no consolidated and common
indicators that objectively assess, on the one hand, the socio-economic situation in the
country, and on the other, the activities of public authorities responsible for the
implementation of macroeconomic policies. As a result, economic actors (households,
firms and the government) have different perceptions of economic trends in the country
and their economic expectations are beginning to contradict to each other, which
hinders, sometimes, a negative impact on economic growth. The relevant ministries,
economic research institutes of the Academy of Sciences and economic universities
and institutions should assist the Government in developing the principles of preventive
macroeconomic policy, which is based on proactive measures to reduce the risks
affecting the results of operations. To do this, it is necessary to start calculating the
index (indices) to objectively assess the short-, medium- and long-term trends in the
development of the country. In a market system, which has not yet developed the stock,
currency, credit and other markets, such indexes should be of informative nature
(published quarterly) and to give everyone the opportunity to make independent
economic entities, i.e. rational, and therefore the optimal economic decisions. This will
reduce the importance of subjective approaches taken by government agencies and
economic solutions to enhance the role of civil society in making such decisions. The
decisions taken during such policy, in addition to traditional indicators should be based
on the following indices (i.e. aggregates):
1) Macroeconomic unit
- An index of business confidence (or PMI)
- Consumer sentiment index
