July 12-13

Summary
In 1992, a process of political and economic transition started that even today, 20 years on, has not been completed. At the time, no one could foresee how this process would turn out—after all, in the words of the famous Yogi Berra, making predictions is hard, especially about the future ^[1] - but the JVI’s founders presciently saw the enormous need for training that these historical dynamics would bring and seized the opportunity to jointly establish the JVI. Just like the transition process is ongoing, so is the need for training and institutional capacity development. It is thanks to the farsightedness and determination of the JVI’s founding members—the Austrian Ministry of Finance (BMF) and the Austrian Central Bank (OeNB), the IMF, the BIS, the EBRD, the OECD, the WB, and, joining shortly after, the WTO—that the JVI’s 20-year anniversary could be celebrated this year.

Thus, during July 12-13, 2012, the JVI, in cooperation with its Primary Members (Austria and the IMF), organized a high-level conference that brought together prominent policymakers, academics, and representatives of various international institutions to discuss lessons from the financial crisis and their implications for training and capacity development. Notably, all of the JVI’s Contributing Members, and the European Commission (EC),^[2]  were represented on the program. The event took place at the OeNB’s beautiful Kassensaal. Following opening remarks by Eduard Hochreiter, Director of the Joint Vienna Institute, the conference was opened by Ms. Maria Fekter, Minister of Finance, Republic of Austria and Ewald  Nowotny, Governor Oesterreichische Nationalbank.

Thematically, the conference was split into two parts. The first day went under the heading of “The Way Forward: Central, Eastern, & Southeastern Europe (CESEE)” and focused on the lessons from the global economic crisis, the measures needed for monetary and financial stability, and new growth models for CESEE economies. A key lesson, succinctly summarized by Minister Fekter, was the “need to spend the taxpayers’ money in a more sustainable way.” Less credit- and debt-fueled growth, in both the private and the public sectors, was seen by most to be a desirable feature of future growth models. But caution was also advised against drawing the wrong conclusions: in Professor Thorvaldur Gylfason’s (University of Iceland) view, “we need more Europe, not less Europe.”

The second day on “Past, Present & Future of the JVI” centered on the lessons from the JVI’s two decades of operation and their implications for the JVI’s future strategy, especially in light of the policy challenges posed by the current global environment and the new training and capacity needs by its member countries. Looking back, Ms. Nemat Shafik, the IMF’s Deputy Managing Director, recalled that many of the countries emerging from communism “will say that it was the Fund’s work on capacity building and training which they valued even more than the financing and policy advice.”

Looking ahead, Ms. Sharmini Coorey, Director of the IMF’s Institute for Capacity Development, noted that “the challenge is now: how are we going to adapt to the future? What impact are we having?” Ensuring that countries’ training needs are met and figuring out how best to evaluate the training efforts were key themes of the second conference day. Mr. Ewald Nowotny, Governor of the OeNB, touched on both when saying that the JVI “is not a one-way street, it is not just about teaching or giving assistance, it is something where we want to have a two-way communication.”

Discussion among the panelists pointed to several areas where such two-way communications could take place. An obvious one is that of training evaluation, most importantly in regards to effectiveness—does the training provide skills that actually improve outcomes?  Another area for two-way communication is the coordination between technical assistance (TA) and training activities: many potential synergies exist in combining them, but in addition, as Mr. Bojan Marković, Vice Governor of the National Bank of Serbia, pointed out, TA could help curriculum development activities in that TA may pinpoint areas where more training is needed. Two-way potential was also seen in the possibility of strengthening alumni networks, peer-to-peer training, and “train the trainer” efforts.

Discussions also revolved around the mode of training delivery. What should be the role of e-learning? Should courses be shorter, more specialized? And to what extent can country-specific training, or training for small clusters of countries, be done? Panelists recognized that given tight budget constraints, not all avenues of innovation could be pursued.

The well-received conference was concluded with the 2012 JVI Annual Lecture on “Growth and the Smart State,” which was delivered by Professor Philippe Aghion, Harvard (see box).

In sum, all conference participants seemed to agree that the JVI is a unique and important institution today, just as it was in 1992, even though—or rather, because—it changed substantially during those two decades. A short video, prepared by the IMF’s External Relations Department, “Growing People, Building Institutions “highlights these achievements. It is accessible at the JVI’s homepage. The JVI is likely to remain relevant also in the future, filling important capacity development needs in its member countries. But to do so, the JVI itself must continue to learn and evolve.

Martin Schindler, Senior Economist 

End notes:
Additional materials on the conference can be found at the conference homepage (http://www.imf.org/external/np/seminars/eng/2012/jvi/index.htm), including videos of the full conference. More details especially on the first day of the conference are provided in an article in the IMF Survey Magazine (http://www.imf.org/external/pubs/ft/survey/so/2012/CAR071912A.htm) and a blog entry by Ms. Shafik (http://blog-imfdirect.imf.org/2012/07/27/convergence-crisis-and-capacity-building-in-emerging-europe/).

[1] While this quote is typically attributed to Yogi Berra, Niels Bohr, the physicist, has also been credited with a variant of the phrase (http://en.wikiquote.org/wiki/Yogi_Berra).

[2] The EC obtained Observer Status on the JVI Board in 2007.

To celebrate its 20th Anniversary, the JVI held an Essay & Video Contest asking contest participants to write an essay and/or produce a short video that illustrates the role that education and training in general, and the JVI in particular, have in helping countries manage their transition from planned to market-based economies.

The JVI congratulates the two winners, Ms. Albina Demollari (best essay) and Ms. Irene Melnikova (best video), on their winning submissions!