Colombia case study: results measurement and poverty eradication
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Speakers:
Antonio Celia Martinez-Aparicio, president, PROMIGAS
Carlos Enrique Cavalier Lozano, president, Alqueria
Fernando Cortes McAllister, president, Bolivar-Davivienda Foundation
Pedro Alba, director Latin America, World Bank
Respondent:
Hans Schulz, general manager structured and corporate finance, IDB
Moderator:
Presentations
Irene Arias, Andean regional manager, IFC
Antonio Celia Martinez-Aparicio
- regional transmission partner support IFC since 1996
- 10 years later, selling gas in package programme
- preliminary regulation, providing public service, needed to understand more about the natural gas sector – eg trade off regulations and how the economy works
- more than the normal private approach to business
- wanted to know whether it made sense with natural gas, rather than coal etc
- economics, wanted to measure benefits on country level, should give numbers to government, and the numbers were very good
- economic cost of natural gas was lower – it made sense to use natural gas
- gov opened the sector for private sector
- huge growth of private initiatives in natural gas, users expanded
- good examples to how to use measurement
- what were the effects of natural reduction of poverty
- found that a bill of a family went down
- IFC programme to finance natural gas to poor communities
- index of quality of life went up
- 30 % of respiratory illnesses down
- need to know customers and what people need
Carlos Enrique Cavalier Lozano
- not yet the same virtuous cycle as PROMIGAS
- 20 years ago, grew from small diary, increase in UHT milk, not refrigerated
- worked with families
- needed to raise productivity, litres per cow and per hectare
- people have done this for generations, needed to develop a measurement for them
- wanted to shift from price to other measurements, litres per hectare (not cow), and cost per litre of milk
Fernando Cortes McAllister
- banking part of social solution to many problems
- results measurement and being more proactive is hard with communities
- started working with other companies, eg bank, construction company
- find what to measure more profoundly to have larger impact
- eg have price for low income households
- creating activities in communities, sports, teaching – to create social capital
- don’t have all the answers, but know what to do to improve the efforts
- helping a government initiative to 100,000 families
- reaching new customers not in the banking systems
- trying to understand how the poor save and invest
Pedro Alba
- As these initiatives are growing, we are diminishing
- Colombia still large client, but not on financial services
- The government’s objectives are to reduce poverty and increase shared prosperity – but we are small
- We try to leverage financial resources and bring toolkits
- Difficult to measure results
- Focusing on knowledge, but it’s difficult to measure impact – one of the big challenges we have
- Try to focus more on resources
- Try to focus less on the growth side, but more on equity side – how to make distribution better, eg education, including results measurement
- To measure knowledge, trying to have result stories, and follow up 2-3 years later
- Trying to work with government, eg on measuring poverty, prosperity, through several initiatives to improve measurements
- Lot of data, could this be available in something similar to the WB’s open data initiative
Irene Arias
How to leverage resources to better measure results
Martinez-Aparicio
- have done this with IFC
- all we do we measure, we can demonstrate that certain interventions produce good results
- if we get IFC/WB funds we can have great impact on education
- if you replicate as public policy, need to go down to implementation
- need very good institutions to achieve what you want to do
Cavalier Lozano
- have to understand what the government can do in terms of policies
Cortes McAllister
- government doing its best to create PPPs that Kim was talking about earlier
- private sector huge advantage over government, innovative way, more effective and measure the solutions – if we get the challenge from the government to resolve issues and the back up from the government to commit to the solution
Alba
- important to continue the effort of results measurement
- try to make the result measurement more open, by open data initiative
- PPP, the government is trying to get local governments more responsible for service delivery
- people has relatively good coverage of service delivery
- 60% of people satisfied, PPPs an opportunity in providing those services, including some of the social objectives, not just profit
- should be measured, the private sector is willing to do this
- maybe also environmentally sound, not just socially and economically
Hans Schulz
- lot of companies doing a lot of good thing in search of smarter ways of doing their businesses, to resolve poverty, social issues, etc
- easy to get caught up in evaluation, measurement, etc – no one fits all approaches
- also critical who does it in the firm, how much money you pay and what you get out of it
- innovation and knowledge sharing, have a long way to go, not yet in perfect shape
- helps tell customers why to go to you and not competition
- also need to be realistic of who can do what best
- think about innovation, chose our partnerships strategically, then focus on measurement of results
Q&A:
Q:
Republic of Guinea, ministry
- where do countries like ours begin
- we have a private sector, but not as active as in Colombia
- few big companies, mining country, six largest mining corporations including Rio Tinto – those are the one observing CSR – its in their business plans
- pressure from local community as they have to build infrastructure, they have to displace communities, otherwise they are unable to conduct their business
- they go on their own to do their measurement, government does not have the results
- Guinean owned companies have so many constraints, the cost of doing business is extremely expensive, therefore profitability first concern
- when you talk about CSR, you have to first break even
- trying with assistance of IFC to at least put in place the various reforms that can improve the business climate, so that they can grow their business
- we measure reduction of poverty by jobs created, but no structure of doing so
- all of these issues are major concern
- I have learned a lot here, but how to bring the national companies to start measuring – but they will say that they have to break even first
Alba
- difficult task ahead, but what we hear is the approach to take with local private companies is to demonstrate to them that through these type of activities they can develop their businesses – better targeted, identify areas of growth, including savings for households (gas examples)
- WB/IFC would be happy to provide help in this area
- a lot of comments on the need for the government, market coordination failures
- need for some part of government coordination, the government has already a big task – take government plans, try to fit activities within that area
- on the knowledge side, some kind of knowledge repository could be good
- shouldn’t create something new
- the advantage of the private sector, governments can take a lot of risks, eg cash transfers, how do you monitor the results
Calavier Lozano
- 15 years ago we went through a long process – worried about people not being able to eat, discovered food banks and started giving money to them
Cortes McAllister
- PPPs, when you get results, we don’t communicate, if we don’t get inspired we don’t move from stage one – if we include the academic institutions that create knowledge, we might find a lot of interesting things – have to tell the country what is going on, there we are lagging behind
