- Key contributions
Overview: Economic development agencies in the Commonwealth
Worldwide, three Commonwealth countries rank highly in the World Bank’s 2011 Ease of Doing Business Index: Singapore (number 1), New Zealand (3) and UK (7). Ranking so highly on the index means the business environment in a country is most conducive to the protection of investors with favourable taxation, international trade, credit access and the general starting and operation of a local firm. Five Commonwealth countries also rank highly on purely how easy it is to start a business: New Zealand (1), Australia (2), Canada (3), Singapore (4) and Rwanda (9).
Such success in the Commonwealth can be attributed in part to the role played by economic development agencies, bodies tasked by government with the promotion of economic development and growth in a country. Organisations involved in helping in the setting up of a business include investment promotion agencies (IPA), export processing zone (EPZ) authorities, central banks, company registration authorities, regional or local development agencies, tourism development agencies and development banks. Some economic development agencies are involved in other ways of promoting growth in the local economy, for example, export promotion agencies (EPA) and tourism promotion boards.
Key contributions of economic development agencies
Almost every Commonwealth country has an investment promotion agency (IPA) or export promotion agency (EPA). IPAs provide free advisory services to prospective and mostly foreign investors, leveraging the opportunities that a country has to offer. EPAs, on the other hand, promote a country’s goods and services in foreign markets by, for instance, publishing marketing material, delivering sector analysis and representing at international fairs. In some Commonwealth countries, such as Sierra Leone, one organisation serves as IPA and EPA.
EPZ authorities play a similar promotional role to IPAs and EPAs albeit a more defined one, that is managing EPZs. EPZs are export processing tools which can mean anything from ‘a purpose-built 300 hectare fenced industrial estate consisting exclusively of export processing firms’ to ‘a collective defining export processing firms located anywhere in a country’. EPZ firms are often incentivised by government with the streamlining of red tape, duty-free imports of raw and intermediate inputs and capital goods for export production, relaxation of labour laws, more advanced communications services and infrastructure, subsidies and low taxation. Such incentives are administered by EPZ authorities.
Tourism is central to many Commonwealth economies such that at times a tourism promotion board or development agency can turn out to be the most indispensable economic development agency. The most active tourism promotion boards have offices in many countries and broad internet presence.
Development banks are institutions that provide financial support and professional advice for economic and social projects aimed at national or local development. Although the roles played by continental development banks such as the Asian Development Bank and African Development Bank are extensive and well known, a number of Commonwealth countries in Africa and Asia have established their own development banks. A few development banks have expanded into other activities such as commercial banking.