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Latvia ’s experience of transition management

Baltic experience in transition, Latvia’s case study Armands Eberhards, CFCA director 30.12. Belgrade. Latvia ’s experience of transition management. From socialism to EU membership -15 yr : Shock therapy vs gradualism debate Reforms and better use of national funding

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Latvia ’s experience of transition management

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  1. Baltic experience in transition, Latvia’s case studyArmands Eberhards, CFCA director 30.12. Belgrade

  2. Latvia’s experience of transition management • From socialism to EU membership -15 yr : • Shock therapy vs gradualism debate • Reforms and better use of national funding • Experience of PF reforms to better exploit EU funds • EU integration, adoption of Acquis • Lessons learnt • References

  3. Reforms and better use of national funding • Public finance –effective management of public funds: policies and implementation –expenditure, revenues; public procurement; planning; no different treatment of internal and external funds • Institutional building- capacity building of MoF, ST, SRS (incl. Customs), PPB, CFCU • Supreme Audit Office- external audits, adoption of International standards, best practices • Effective Internal Audit services; risk management based approach

  4. Experience to reform PF to better exploit EU funds • MoF, ST - no new structures for similar functions- complimentarity, additionality; absorption capacity; co-financing; ownership of reform process • CFCA- financial and administrative management- DIS, EDIS; SFM “innovations” in practice; Phare, ISPA, ERDF etc • Line ministries: policy responsibility, technical competence; PMU- technical management • Incentives to emulate and negative externalities • Reforms first (business plan) then investments • Specialized agencies: LDA- FDI, export promotion, state aid management (ERDF,ESF); NVA-employment promotion (ESF)

  5. EU integration, adoption of Acquis • National program for the Adoption of Acquis – political priority • European Integration Bureau -coordination, supervision, harmonization of legislation • Translation of Acquis- Translation and Terminology Centre • Intra ministerial cooperation and coordination in negotiation process • Prioritization of budget expenditures and technical assistance- institution building (HRD and investments)

  6. Lessons learnt • Noready- made solutions, local solutions for domestic problems – gradual reforms • Objectives of transition to benefit constituencies- transition as domestic political process • Close collaboration with international partners- active dialogue • Institution building - constant process of planned improvements to provide better services

  7. References • State Audit Office http://www.lrvk.gov.lv/ • Ministry of Finance http://www.fm.gov.lv/ • Central Finance and Contracting Agency http://www.cfla.gov.lv/ • State Treasury http://www.kase.gov.lv/ • Latvian Development Agency http://www.liaa.gov.lv/eng/ • Latvian Employment Agency http://www.nvd.gov.lv/

  8. Thank you! Armands Eberhards, MSc, MBA CFCA Director Smilsu Str.1, Riga, Latvia Armands.Eberhards@fm.gov.lv Armands.Eberhards@cfla.gov.lv

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