Technology leapfrog in government transparency developing countries


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Describes how developing nation governments are leapfrogging developed nation governments in transparency. Example of budget transparency is given with screenshots from the beta Timor-Leste transparency portal. Argument made for transparency to increase citizen and business confidence and kickstarting economic growth.

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  • The digital world eliminates physical barriers and enables more efficient movement of goods. Globalization favours this efficient movement creating local and global competition. It also increases the information available to businesses, citizens and civil society. The hyper-competition thanks to globalization and digital technology means that businesses have choices. They seek out high growth but stable markets. This reality is driving government reform.
  • It doesn’t matter how well governments control the press or control the message. Technology enables citizen surveillance of government. These means millions of eyes trained on governments where mobile technology has become the game-changer. For example, texting was used in Sudan to reduce election fraud
  • The recent financial crisis has developed in what Mohamed El-Erian of PIMCO calls the “new normal”. One way that we know that the world is no longer developed country centric comes from the automobile industry – many established brands were acquired by (or had offers from) companies in BRIC countries.
  • The theory of technology leapfrog has been applied to Internet, mobile, e-business and e-government. The notion is that less developed countries often have less entrenched technology vendors and that some stages can be skipped – for example skipping wired Internet and moving rapidly to wireless. It enables countries to focus on what is important and learn from what works in other countries.
  • The Government of Thailand is attempting e-government technology leapfrog. Why would countries want to improve transparency?
  • Tim O’Reilly, who created the “Web 2.0” term, promotes the notion of “government as platform”. In addition to the benefit of transparency to improve governance, government data can lead to economic development. Governments around the world invest in infrastructure such as roads and airports as a foundation for business. This can be extended in the virtual world. Mr. O’Reilly makes a compelling argument of how technology brought into the public domain has created economic growth and innovation: global positioning and the Internet. There can be many ways in which data can generate economic growth. Resource companies can use the data to uncover opportunities. Demographic data can help companies plan stores or factories.
  • This begs an interesting question. Why would developed countries – with head starts – be ripe for leapfrogging?Monopolies and large telecommunications companies place pressure on governments to slow down the pace of change.Many government organizations receive revenue by selling data. Providing this data free reduces this revenue and there is no real connection with the downstream benefits of more tax revenue.Many countries are reluctant to use international standards.Developed country governments tend to focus on complexity – they seek best practices and rethink initiatives rather than publish data and learn.Of course, market integration in developed countries means that they are often under less perceived pressure from globalization, and are more focused on regional issues like the Euro crisis.
  • Our recent FreeBalance International Steering Committee survey demonstrated some leapfrog opportunities.
  • An example is budget transparency. Governments in developed countries have improved budget transparency,
  • With many producing reports in PDF format and a few providing interactive data. Developing country governments can leapfrog,
  • with interactive drill down into government data
  • with 10 years of budget execution data with drill down through the government chart of accounts
  • export to numerous machine readable formats, plus tracking the entire budget cycle: original budget, budget transfers, commitments, obligations and actuals
  • It’s no wonder that all FreeBalance international customers surveyed claim to be committed to public financial management and transparency and most are adopting international standards.
  • Standards enable more effective comparisons and generate confidence. There are additional opportunities for developing nation governments.
  • Developing nation governments can leapfrog by recognizing the power of social media rather than the traditional publish model – more current information, vetted by the community and enabling unexpected economic usages.
  • Which brings government from being out of network – or broadcasting
  • To in-network, or participating with citizens, civil society and businesses. This creates a network effect.
  • There are challenges. Developing nation governments need to build infrastructure. They often have to coordinate donors who require different methods of reporting, adding to “transaction costs”. Many governments are still concerned about hard ROI justifications. This is often impossible given the network effect where data from multiple sources are used to generate economic growth. And, governments need to be more collaborative in releasing data and getting feedback for improving data accessibility.
  • Technology leapfrog in government transparency developing countries

    1. 1. Technology Leapfrog – Government Transparency<br />FreeBalance International Steering Committee<br />January 18, 2011<br />Doug Hadden<br />VP Products<br />
    2. 2. Agenda<br />Effects of Globalization<br />Emerging Markets Growth<br />Theory of Technology Leapfrog<br />Government as “Platform”<br />Inhibitors<br />4 E-Government Transparency PFM Leapfrog Opportunities<br />Challenges<br />
    3. 3. Globalization<br />Digital technology<br />Efficient movement of goods<br />Competition for markets, businesses<br />Ever increasing information availability<br />Driving reform<br />
    4. 4. Citizens are Watching You<br />21st Century – don’t worry about the *Press<br />Technology in the hands of citizens<br />Millions of untrained auditors<br />Mobile phones game-changer<br />* Lesson learned in Iran, China, Egypt, Tunisia<br />
    5. 5. Globalization Extended<br />1. Good<br />Governance<br />1. Good<br />Governance<br /> Governments <br /> Governments <br />2. ICT<br />Modernization<br />2. ICT<br />Modernization<br />External Forces<br />External Forces<br />Globalization<br />Globalization<br />Internal Forces<br />Internal Forces<br />Increasing Citizen Expectations<br /><ul><li> Transparency
    6. 6. Improve Citizen Services
    7. 7. Health, education, infrastructure, prosperity</li></ul>Improve Development Outcomes<br /><ul><li> Donor Funding
    8. 8. Benchmarks and Indicators
    9. 9. Stability and Sustainability</li></ul>Global Competition<br /><ul><li> Business Friendliness
    10. 10. Corruption Index
    11. 11. Infrastructure</li></li></ul><li>Emerging Markets – High GrowthContribution to World Growth by Region<br />2007<br />2008<br />80<br />70<br />60<br />50<br />40<br />30<br /><ul><li> Canada
    12. 12. United States</li></ul>20<br />10<br />0<br />USA<br />Developed<br />Developed<br />Emerging<br />Other<br />Europe<br />Asia<br />Economies<br />Source: Mirae Asset<br />
    13. 13. Emerging Markets – High Growth GDP Growth, % Share of World Total*<br />90<br />80<br />70<br />60<br />Developed<br />50<br />Economies<br />Emerging<br />40<br />Economies<br />30<br />20<br />Emerging Markets responsible for most of the global growth<br />10<br />0<br />1984<br />1989<br />1994<br />1999<br />2004<br />2009<br />Sources: IMF, The Economist<br />* At purchasing power parity<br />
    14. 14. Emerging Markets – High GrowthShare of Global GDP*<br />Emerging Markets responsible for most of the global growth<br />70<br />60<br />50<br />40<br />Emerging<br />Economies<br />30<br />Developed<br />Economies<br />20<br />10<br />0<br />1913<br />1950<br />2005<br />2025<br />* At purchasing power parity<br />Sources: IMF, The Economist<br />
    15. 15. Emerging Markets – High Growth “New Normal”<br />
    16. 16. Theory of Leapfrog<br />Legacy technology entrenched in developed countries<br />Bi-pass stages in development<br />Focus on what is important<br />Learn from other countries<br />
    17. 17. Example: Thailand<br />
    18. 18. 3<br />AUSTRALIA<br />HIGH<br />2<br />1<br />Normalized Control of Corruption Index<br />PAPUA NEW GUINEA<br />0<br />UGANDA<br />-1<br />Higher the control of corruption = higher the country GDP Per Capita<br />-2<br />204 Countries<br />LOW<br />-3<br />GDP Per Capita (PPP, logs)<br />Benefits of TransparencyControl of Corruption and GDP*<br />Source: The World Bank<br />* At purchasing power parity<br />
    19. 19. 3<br />HIGH<br />2<br />AUSTRALIA<br />1<br />PAPUA NEW GUINEA<br />Normalized Voice and Accountability Index<br />0<br />UGANDA<br />-1<br />Higher the government accountability = higher the country GDP Per Capita<br />-2<br />207 Countries<br />LOW<br />Source: The World Bank<br />.<br />-3<br />GDP Per Capita (PPP, logs)<br />Benefits of Transparency Voice and Accountability and GDP*<br />* At purchasing power parity<br />
    20. 20. 3<br />HIGH<br />AUSTRALIA<br />2<br />1<br />Normalized Government Effectiveness Index<br />UGANDA<br />0<br />PAPUA NEW GUINEA<br />-1<br />Higher the government effectiveness = higher the country GDP Per Capita<br />-2<br />209 Countries<br />LOW<br />Source: The World Bank<br />-3<br />GDP Per Capita (PPP, logs)<br />Benefits of Transparency Government Effectiveness and GDP*<br />* At purchasing power parity<br />
    21. 21. Government as Platform<br />Data can lead to economic development<br />Infrastructure<br />GPS, Internet<br />How?<br />Resources information<br />Demographics<br />
    22. 22. Why would more developed countries get leapfrogged?<br />Business Pressure<br />Telecommunications and other monopolies<br />Budget Pressure<br />Affect revenue from selling information<br />Sovereignty Pressure<br />Reluctance to give up national standards<br />Best Practice Pressure<br />Focus on complexity<br />Economic Pressure<br />Less pressure from globalization<br />
    23. 23. E-Government PFM Transparency Leapfrog Opportunities<br />
    24. 24. Budget Transparency<br />Audited books pdf<br />PDF on-line<br />Budget book printed<br />Budget speech pre-released to press<br />Budget speech in official gazette<br />Budget presentation in legislature <br />
    25. 25. Budget Transparency con’t<br />….<br />Budget data in XBRL<br />Participatory budgeting<br />Interactive budget execution data<br />Quarterly audited reports PDF<br />Audit findings PDF<br />
    26. 26. beta version of Government of Timor-Leste transparency portal <br />subscribe<br />drill down<br />articles<br />
    27. 27. Expenditures, Transparency Portal<br />10 years of data<br />drill through the chart of accounts<br />
    28. 28. Expenditures, Transparency Portal<br />export to xls, doc, pdf, html, xml<br />track commitments<br />
    29. 29.
    30. 30.
    31. 31. FreeBalance Survey<br />
    32. 32. E-Government PFM Leapfrog Opportunities<br />Support for international standards<br />GFS/COFOG/IPSAS<br />XBRL & IATI<br />M-Government financial services<br />Freedom of Information<br />
    33. 33. Models of Government Data<br />Publish Model<br />You know what it is for and how it will be used<br />Document oriented<br />Vetted, edited, approved<br />Old – previously owned information<br />No access to underlying data<br />Social Media<br />You don’t know how it will be used<br />Machine readable<br />Community vetted<br />Useful and current<br />Full access to underlying data *<br />
    34. 34. Out of Network<br />
    35. 35. Out of Network vs. In Network<br />
    36. 36. Challenges<br />Infrastructure<br />Donor coordination<br />“Return on Investment”<br />Collaborative culture<br />
    37. 37. Thank You<br />