Policy Support Instruments Research Articles

10.C. Round table: EU Global Health Strategy: Mapping European support for improving health and health systems globally

Abstract In November 2022, the European Commission unveiled its new Global Health Strategy. Featuring three cross-cutting priorities, the Strategy calls for the mobilisation of a “wide number of policies to work on a global health agenda” (1). The Strategy also highlights the importance of establishing a “permanent mapping of key measures and financing efforts of the EU and its Member States to better understand what actions are taking place and to allow for tying means to the strategy's priorities”(1). The EU's ongoing actions are already delivering more for health systems globally than one would expect - and it has many policy tools and support instruments which affect Global Health. These instruments vary greatly in their intent and design, with some targeted at strengthening health systems and promoting health and wellbeing, while others contribute to these objectives more indirectly by generating spillover effects. The European Observatory's upcoming policy brief ‘European support for improving health and care systems globally’ aims to unpack the key EU instruments available in policy areas including: • Trade in goods and services • Public investment and fiscal instruments • Official development assistance and humanitarian aid • Solidarity, voice, and multilateralism • Research and training partnerships This roundtable will delve into the main priorities of the Strategy and reflect on upcoming plans for its realisation. Engaging with the audience, the panel will explore the need for transparency, alignment, and coordination of the existing instruments across the different policy areas. It will also discuss opportunities for collaboration between the European level and the EU Member States. This facilitated roundtable discussion will explore how resources such as the Policy Brief can serve as a steppingstone to map and make sense of the diverse range of EU actions relevant for Global Health, in order to maximise synergies, transparency and policy consistency for successful coordination and implementation of the Strategy. (1) EU Global Health Strategy - Better Health for All in a Changing World. Commission Communication COM(2022) 675, https://health.ec.europa.eu/publications/eu-global-health-strategy-better-health-all-changing-world_en Key messages • The EU already has more policy instruments with an impact on Global Health than one would expect. • Delivering on the priorities of the new EU Global Health Strategy will require taking stock of ongoing EU actions and forging meaningful synergies for cross-sectoral collaboration. Speakers/Panelists Scott Greer University of Michigan, Ann Arbor, USA Nicole Mauer European Observatory on Health Systems and Policies, Brussels, Belgium Elena Petelos EUPHA-HTA, EUPHA-GH

Incentives and barriers to private finance for forest and landscape restoration

Increased private finance can accelerate forest and landscape restoration globally. Here we conduct semi-structured interviews with asset managers, corporations and restoration finance experts to examine incentives and barriers to private restoration finance. Next, we assess what type of restoration projects and regions appeal to different private funders and how current financial barriers can be overcome. We show that market incentives for corporations include meeting net-emission-reduction commitments, impact and sustainable branding opportunities, and promotion of sustainability in supply chains. Conversely, asset managers face stronger barriers to investing in restoration as it is deemed a high-risk, unknown investment with low profitability. We find that investment finance biases towards restoration projects in low-risk areas and corporate finance towards areas with business presence. Both private finance types tend to omit projects focusing on natural regeneration. Through expanded and diversified markets for restoration benefits, strong public policy support and new financial instruments, private finance for restoration can be scaled for a wider variety of restoration projects in more diverse geographical contexts.

The Effectiveness of Russian Government Policy to Support SMEs in the COVID-19 Pandemic

This study was aimed at developing a cognitive—econometric model for assessing the effectiveness of the current governmental policies to support enterprises in Russia in the context of pandemic propagation. Using the Granger test and correlation analysis, we formed a system of key indicators that characterizes the economic development of SMEs (small and medium-sized enterprises) in Russia. Based on the revealed causal relationships and correlation coefficients, a model describing the impact of public policy support instruments on SME economic development was built using cognitive modeling. By means of the additive convolution method, the correlation coefficient between the Russia Small Business Index (RSBI) and the COVID-19 prevalence rate was used to predict the 2020 year-end RSBI value. Regarding the RSBI index forecast, the effectiveness of instruments of the state support for SMEs was evaluated. It was determined how much these indicators of the anti-crisis package of measures should change to increase SMEs’ business activities. The developed cognitive model can be utilized by private and governmental institutions to continuously monitor the effectiveness of public policies that support SMEs. It can also be used as a preventive indicator to evaluate the impact of the anti-crisis measures during pandemics and in the case of other exogenous risks threatening SMEs. The originality of the research results was determined by the econometric methods applied to empirically assess the effectiveness and degree of impact of governmental measures on the operation of SMEs under conditions of uncertainty.

Development of Renewable Energy in China, USA, and Brazil: A Comparative Study on Renewable Energy Policies

Countries differ in terms of their socio-economic development, population growth, and energy consumption. Many countries still depend on conventional energy to supply enough energy source for their demand, while some have made considerable progress in making the transition to renewable/sustainable energy sources. Owing to the increasing demand and drawbacks of conventional energy sources, policies can play a major role in encouraging and increasing the uptake of renewable energy (RE) technologies. In this paper, a general overview on the RE activities in the three leading countries—China, Brazil, and the United States of America (USA)—is presented. Moreover, a comparative analysis on the implementations of the RE support policies is conducted. The linear regression analysis technique is applied to develop several models for the three countries in order to investigate the effect of different policies on RE. The main contributions of this study are establishing a link between RE support policies and RE development (in terms of the installed capacity) in the three countries under study, and providing models that can be used in estimating RE development using RE policy data. In addition to this, some models are developed to investigate the relationship between RE installed capacity and the patents. The linear regression analyses suggest that RE policies promote the development of RE installed capacity in the three countries in different proportions. For example, it is found that each additional wind policy will increase the RE wind capacity in China, Brazil, and the USA by 1.63, 0.689, and 1.576 GW, respectively. Moreover, the economic instruments turn out to be more effective in promoting the RE installed capacity in the USA and Brazil, while the policy support and regulatory instruments are the most influential policy categories in China. Furthermore, the linear regression analyses indicate the existence of a positive significant relation between the number of patents and the total RE installed capacity in the three countries.

Heat Storage Combined with Biomass CHP under the National Support Policy. A Case Study of Estonia

Abstract In spite of the progressions in heat storage systems for combined heat and power’ (CHP) plants performance, these innovations have not been implemented in CHP-based district heating (DH) systems in some of the countries where DH systems are still being developed. An examination of environmental and economic advantages that can be gained as a result of heat storage installation into the DH system are necessary to effectively popularise heat storage as a DH system-improvement technology. A real large-scale biomass CHP-based DH system is investigated in this case study. Scenarios for two kinds of support policies (feed-in premium for electricity generated by biomass CHP and energy-efficient biomass CHP) were analysed by changing the extent of the heat storage. The goal of this study was to assess the impact of the biomass CHP policy support instruments on the viability of integrating heat storage. Calculations demonstrate that fitting of heat storage combined with biomass CHP is less viable when all power generated by biomass CHP is subsidised.

Factors affecting the efficiency of wind power in the European Union countries

The study uses the two-stage bias-corrected DEA approach of Simar and Wilson (2007) to assess the efficiency of the EU countries in terms of their wind power investment in 2015. The set of input variables includes installed wind power capacity and average wind power density, while output variables include wind-generated electricity and three additional aspects: environmental, economic and energy security. Next, the study examines the effect of renewable energy policy regarding wind energy, the energy mix, and the offshore wind power utilisation on the wind power efficiency of the analysed countries.The results obtained reveal that the United Kingdom, Sweden, Denmark, and Ireland are the most efficient countries in terms of wind power investment. The inclusion of additional aspects demonstrates the greatest improvement of efficiency in Belgium, Cyprus, the Netherlands, Estonia and Germany.The results seem to indicate that economic instruments used within renewable energy policy have a positive effect on wind power efficiency, while policy support and regulatory instruments might negatively impact. Moreover, the results show that the energy mix explains the variation of the efficiency of the EU countries when their economic and environmental aspects are considered. The analysis of the geographic location indicates that countries with a high share of offshore wind capacity are the most efficient.

The Relevance of Quantity and Quality Entrepreneurship for Regional Performance: The Moderating Role of the Entrepreneurial Ecosystem

This study analyses how the entrepreneurial ecosystem and different types of entrepreneurship — i.e., quantity (Kirznerian) and quality (Schumpeterian) entrepreneurship — impact regional performance, in terms of gross value added per worker and employment growth. By analysing 121 European Union regions between 2012 and 2014, we find that an enhanced entrepreneurial ecosystem yields to superior regional performance. The results reveal a heterogeneous effect of quantity- and quality-based entrepreneurship on regional performance: quantity (Kirznerian) entrepreneurship negatively impacts regional performance, while this effect turns positive in case of quality (Schumpeterian) entrepreneurship. The findings also suggest that regions with a healthy entrepreneurial ecosystem have a greater capacity to materialize the effects of high regional business formation rates, regardless of their quality level (Kirznerian entrepreneurship), while regions with weak entrepreneurial ecosystem may rely on Schumpeterian entrepreneurs — who channel new and more innovative resources to the economy — to compensate the absence of entrepreneurship policy-support instruments and increase their economic outcomes.

Evaluating the Impact of Non-Financial IMF Programs Using the Synthetic Control Method

We use the Synthetic Control Method to study the effect of IMF advice on economic growth, inflation, and investment. The analysis exploits the existence of IMF programs that do not involve any financing (Policy Support Instruments, “PSIs”). This enables us to focus on the effects of IMF monitoring, advice, and approval (as opposed to direct financial assistance). In addition, countries with non-financial programs are typically not crisis-struck – thereby mitigating the reverse causality problem and facilitating the construction of counterfactuals. Results suggest that treated countries add about 1 percentage point in annual real GDP per capita growth, with inflation being lower by some 3 percentage points per year. While we do not find evidence for an impact on total investment and the resulting capital stock, PSI-treatment does seem to stimulate foreign direct investment.

Evaluating the Impact of Non-Financial IMF Programs Using the Synthetic Control Method

We use the Synthetic Control Method to study the effect of IMF advice on economic growth, inflation, and investment. The analysis exploits the existence of IMF programs that do not involve any financing (Policy Support Instruments, “PSIs”). This enables us to focus on the effects of IMF monitoring, advice, and approval (as opposed to direct financial assistance). In addition, countries with non-financial programs are typically not crisis-struck – thereby mitigating the reverse causality problem and facilitating the construction of counterfactuals. Results suggest that treated countries add about 1 percentage point in annual real GDP per capita growth, with inflation being lower by some 3 percentage points per year. While we do not find evidence for an impact on total investment and the resulting capital stock, PSI-treatment does seem to stimulate foreign direct investment.

Sustainability assessment to support governmental biodiesel policy in Colombia: A system dynamics model

Combustion of fossil fuels in the transport sector represents the second largest source of greenhouse gas emissions. For this reason, governments are fostering diversification of energy sources by creating a set of governmental environmental policies and initiatives. In this context, biofuels are expected to represent a substantial part of source diversification, but it is necessary to assess the sustainability of their market to explore its effect on economical, technological, social, political and environmental dimensions. This research presents a dynamic simulation modelling of the Colombian biodiesel market and analyzes the policy support instruments for creating and managing it. A system dynamics based model is proposed to enable decision-makers to understand the influences between the different variables that describe the system and the impact of the biodiesel government policy in Colombia. The primary focus of this paper is to establish the characteristics of each sustainability dimension for the case of study and apply the system dynamics methodology with different types of validation. Finally, the Colombian market status and a sensitivity analysis are developed. The results show that in order to support the development of this sector, it is necessary to diversify the raw materials for the production of biodiesel in the medium term, which means raw materials without competence for the primary rainforest or competition with food productive lands.

Reform of the Fund's Policy on Poverty Reduction Strategies in Fund Engagement with Low-Income Countries - Proposals

Poverty reduction strategies (PRS) are central to Fund-supported economic and financial programs in low-income countries (LICs). The joint IMF-World Bank’s Heavily Indebted Poor Country (HIPC) Initiative introduced the PRS approach and established documentation requirements centered on the Poverty Reduction Strategy Paper (PRSP). The PRS approach has also been a cornerstone for the Fund’s concessional financing, currently the Extended Credit Facility (ECF), and has been extended to the Policy Support Instruments (PSI), the non-financing instrument for LICs, with PRS documentation serving as the operational framework for development of strategies to promote growth and reduce poverty under Fund-supported programs.

Future biodiesel policy designs and consumption patterns in Latvia: a system dynamics model

Abstract Decarbonisation of transport has become central to European Union policy. Biofuels are expected to represent a substantial part of the overall strategy towards diversifying Europe's energy supplies and curbing greenhouse gas emissions in a cost-effective way. This research deals with the dynamic simulation modeling of a biodiesel market as a part of transportation fuel market and analyses of various policy support instruments on increasing the proportion of biofuel in total transport fuel demand. The study is carried out for Latvia's road transport sector. After it had experienced generous financial support from the government allowing the industry to develop, support was abruptly stopped creating stagnation in both biodiesel supply and demand. This threatened the national transport policy goals. The goal of this research is to find the most effective policy strategies for achieving the national transport policy goals by applying system dynamics modeling to the current market conditions of transport fuels.. Specifically, the primary focus of this paper is an attempt to gain insight into the long-term dynamic behavior of the biodiesel market in Latvia. The principal policy tools and mechanisms implemented can be summarized as: i) state subsidies at different levels and stages (i.e. the biodiesel production sector, the agricultural sector, and the end consumer sectors), ii) increasing the excise taxes on fossil fuels, iii) increasing the share of the biodiesel in the transportation fuel blend. The results obtained from model simulations confirm that promoting biofuel acceptance among end-users is the primary key issue.

Analyzing policy support instruments and regulatory risk factors for wind energy deployment—A developers' perspective

A transition to a renewable energy system is high on the policy agenda in many countries. A promising energy source for a low-carbon energy future is wind. Policy-makers can attract wind energy development by providing attractive policy frameworks. This paper argues that apart from the level of financial support, both the risks stemming from the regulatory environment (legal security, administrative process and grid access) and the ability to finance projects play a critical role in determining the attractiveness of the development environment. It sheds light on how project developers trade off these different aspects and to what extent the attractiveness of a certain policy framework increases with the introduction of specific measures. Conjoint analysis is employed to provide empirical evidence on the preference of wind energy developers in the EU and the US. The analysis shows that developers' preferences are very similar across the studied regions and for different types of developers. Which policy measures could be most valuable depends on the specific existing environment. In some southeastern European countries, a reduction of administrative process duration may yield the highest utility gains, whereas, in the US, improvements in grid access regulation and an increase in remuneration levels may be more effective.

Application of Structural Conditionality - 2008 Annual Report

This report provides an update, based on objective indicators, of the application of structural conditionality in Fund-supported programs. Such annual reports on structural conditionality are one element of the management implementation plan (MIP) prepared in response to the Board-endorsed recommendations made in the IEO evaluation of Structural Conditionality in IMF-Supported Programs. This annual report covers Fund arrangements approved during the period 1995–2007 (and their reviews through April 30, 2008), extending therefore the dataset contained in the recent IEO report by about three years (from 2005 to 2007). In addition, this report examines experience with Policy Support Instruments (PSIs), which were introduced in October 2005, and thus not covered in the IEO evaluation.

Renewable energy and the environment in South Africa: A way forward

The need to mitigate the adverse environmental impacts of fossil fuel usage, the volatility of fuel prices and enhancement of national energy security, have largely driven a phenomenal growth, around the world, in renewable energy (RE) generation (particularly grid-connected), over the past two decades. The necessity to apply policy support instruments to promote the dissemination of these technologies is now a universally accepted norm. Different countries and societies depending on the prevailing socio-economic environment draft and apply their policy frameworks differently and debates abound as to which mechanisms should have been most suitable under which circumstance. Most of these debates, however, assume the existence of an intrinsic political environment in favour of the process. In South Africa the current political environment is not very conducive to the development of a sustainable RE industry. This paper explores some of the anomalies and barriers and suggests possible options for a way forward to a viable RE industry in the country.