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SME Legal Environment Meeting Minutes, January 27, 2006 January 27, 2006 ? 14.00-15:15 - . IFC Private Enterprise Partnership Tajikistan Office
The meeting agenda was mainly focused on Foreign Trade / Foreign Economic Activities regulation and potential reform. Participants gave a brief outline on project activities implemented in this area and discussed key problems to be addressed.
BRIEF UPDATE ON ACTIVITIES
- BISNIS - As a part of the U.S. Department of Commerce, the office of BISNIS actively promotes the American-Tajik commercial dialog and business partnerships. Specifically, BISNIS generates a broad spectrum of market reports designed to provide timely and relevant information to U.S. companies interested in exploring the Tajikistan market. They recently completed the Tajikistan Country Commercial Guide which will be available on the-web shortly.
- USAID/TFI -Pragma Corporation? the project focuses on the following:
a) Supporting Government of Tajikistan (GoT) to enter WTO. The project works closely with Ministry of Economy and Trade by providing trainings, consultations and information
b) Improving trade and investment climate. The project initiated revision of Law on licensing (adopted in 2004) to exclude foreign trade activities from being regulated by this law. The proposal was submitted to the Presidential office and is expected to get approval soon
c) Simplifying procedures for registration of legal entities
d) Customs reform. The main implication was creating Customs Advisory Councils in Khujand, Dushanbe, Khorogh and Kurghan-Tube to work with participants of External Economic Activity. There will be one more established in Tursun-zade soon. The Councils involve representatives of private sector, customs offices and brokers, standardisation agencies, transport organizations as well as local authorities
e) Improving standardisation and certification procedures through assistance in drafting Law on technical regulations (current draft will be circulated to SME group members).
- FIAS/MIGA Improvement of Investment Climate and Investment Facilitation Project ? During the first diagnostic phase the project reviewed theregulatory framework related to the investment climate in Tajikistan and prepared recommendations on 10 areas to be sent to GoT. Among them is the establishment of an investment facilitation structure (agency) that will deal with regulatory reform to increase investment in the country. The government however appears to favour a structure that would have a very wide (arguablty too wide) range of functions including work on regulations, investment promotion, private sector etc.
The project also prepared a Foreign Trade report which will be distributed among SME WG members.
- ITC UNCTAD/WTO - During its second phase the project will implement the following activities:
a) ?Micro level?: SME sector development through supporting fruit and vegetable processors. 6 enterprises have been selected to provide them information and consulting services and ultimately contribute to their export promotion. The project will also support local enterprises to exhibit their goods in different countries. One such exhibition will take place in Russia in February this year.
b) ?Meso level?: Supporting trade promotion organizations. Together with Ministry of Economy and Trade the project established National Trade Development Centre. The goal of the centre is supporting national exporters in strategic planning. In case of mutual agreement with GoT the project will also help to develop National Export Development and National Trade strategies. For the moment National Export Development Strategy for Fruit and Vegetable Sector has been prepared and will be submitted to GoT next week (electronic version to be sent to SME Group members).
c) Improving Standardisation procedures. The project assists Tajikstandart to prepare technical materials and create a website. It has also supported the drafting of the Law on Technical Regulations (Russian version circulated to the SME working group).
In addition the project plans to do a Trade Finance review after completion of the review of Business Centre Providers.
- World Bank ?To address trade and transportation issues the following actions are ongoing, in the framework of the new Policy Based Credit:
a) Improving civil aviation system in Tajikistan. WB will provide technical assistance to improve functionment of the aviation sector, in particular it will work with Department of Civil Aviation focusing on separating its policy making function from that of technical management and delegating the former to the Presidential Office or Ministry of Transportation.
b) Facilitating visa regime through simplification of visa issuing procedure as well as introducing different types of visas.
It was also mentioned that WB will soon publish Trade Diagnostic Study in Tajikistan which was completed last year.
- ADB is expected to continue working on Customs Administration Reform (no representative from ADB was present).
DISCUSSION OF KEY ISSUES RELATING TO FOREIGN TRADE
Further the discussion was held around the major obstacles hindering foreign trade development, such as:
? Licensing
? Other permits
? Customs issues
? Non-tariff barriers: Tajikstandard, Ecological Inspection, Sanitary Epidemiological Service, Quarantine of plants, Chamber of Commerce and Industry, Tajik Universal Commodity Exchange etc.
As possible recommendations participants suggested that:
- The list of activities related to trade operations and subject to licensing, certification or other permits be prepared
- The list of legislative documents regulating foreign trade activity be prepared
- The revision of existing laws be completed to avoid contradictions
- A special institution/committee under the GoT be established to ensure that laws and regulations comply with WTO conditions and specific criteria to be laid out (essentially, minimizing the cost for business).
OTHER ISSUES ? LICENSING REFORM IMPLEMENTATION
Nigina Salibaeva indicated that Article 19 of Law on Licensing stipulates that licenses should exist only as stated in this law and activities subject to licensing are regulated by this Law only. In practice, however, there are many cases where controlling bodies still enforce double regulation. For instance, in order to operate, all the agencies that sell airline tickets are still obliged to be certified by the Department of Civil Aviation (under a regulation issued by this Department) although according to Chapter 39 of regulation on licensing this activity requires obtaining a license.
The certificate is issued for one year and costs around 500 USD (partly ?unofficially?); however no law regulates the fee amount. It is obvious that selling airtickets presents no risk for health and life of the population and therefore should be excluded from being either licensed or certified.
Florentin Blanc added that the third phase of IFC SME Survey and Policy Project will focus on reforming permits system in Tajikistan.
WG members agreed to continue discussion on the topic during the next meeting.
List of participants:
- Hasan Aliev, FIAS/MIGA Improvement of Investment Climate and Investment Facilitation Project in Tajikistan
- Maqsoud Odinaev, ITC UNCTAD/WTO
- Nigina Salibaeva, Attorney, USAID/TFI - Pragma
- Firuz Kataev, World Bank
- Jamshed Rahmonberdiev, US Embassy Commercial Service
- Mitchel Auerbach, US Commercial Service, Almaty
- Florentin Blanc, IFC Tajikistan SME Survey and Policy Project (hosting)
Minutes taken by Manizha Sharifova, IFC Tajikistan SME Survey and Policy Project
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