Feb 17, 2023

Strengthening Capacity Development in South East Europe: An Interview with IMF Advisors at the CEF

The CEF currently hosts two International Monetary Fund’s Fiscal Affairs Department (IMF FAD) technical assistance advisors, covering public financial management (PFM) and revenue administration (RA). We were happy to talk to Yasemin Hurcan and Jim Sørensen. They provide capacity development (CD) support to the six Western Balkan countries (Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, Serbia) under the Revenue Administration and Public Financial Management CD Program in South East Europe with the financial support from the European Commission and the Swiss Secretariat for Economic Affairs. They work with CEF colleagues to create synergies between IMF CD activities and CEF learning events to help address the region's PFM and RA challenges.

You have been in your roles as IMF advisors, covering the areas of public financial management (PFM) and revenue administration (RA), for some months now. How have you settled in at the CEF and in Ljubljana?

Jim Sørensen: Working from the CEF and living in Ljubljana has clearly been the easiest part of moving to another country and working internationally. It is a pleasure to be here. 

Yasemin Hurcan: Our family has finally settled in beautiful Ljubljana but I must say that we found Slovenia a bit too bureaucratic for internationals to settle in easily. Adapting to the CEF has been much easier – I already knew many of the colleagues and I have worked with them before. 

Your work focuses on capacity development in the six Western Balkan countries (Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, and Serbia). What are your priorities in each area of your expertise (PFM and RA)?

Jim Sørensen: All tax administrations need to work with digital transformation, audit, and debt management. They must also continuously improve compliance risk management to increase revenue and make it as easy as possible for taxpayers.

Yasemin Hurcan: On the PFM side, under the Fiscal Reforms in Southeast Europe Capacity Development (CD) Program with the financial support from the European Commission and the Swiss Secretariat for Economic Affairs, we aim to support the authorities in their efforts to strengthen their public investment management (PIM) and fiscal risks management. The COVID-19 pandemic, climate changes, and related infrastructure needs, and the war in Ukraine highlighted the importance of having better PIM and fiscal risk management in the countries. So, we work in these two areas in each of the six Western Balkan countries. In addition to these two regional priorities, we support some countries in preparing their medium-term budget frameworks and improving their cash management practices. 

Which global trends and events present the biggest challenges for continued capacity and social development of the Western Balkans, and indeed also Europe in general? And, in connection with this, what role can the partnership between the IMF and the CEF play in addressing those challenges?

Jim Sørensen: Political stability and willingness to work together. I basically think education, equality, and transparency are some of the main drivers for improvements, so our partnership also plays a role here.

Yasemin Hurcan: All countries around the world have been struggling with many challenges. Inflation, increasing debt levels, climate change, aging population and the need for qualified labor are some of the main issues. In the Western Balkans, these challenges can easily get worse due to lack of political stability and brain drain. We hope that our capacity development activities help the authorities build in-house know-how and capacity to introduce solutions to their macroeconomic and PFM challenges. Technical staff should play a bigger role in the region. They could shape government policies and guide politicians better with their improved analytical capacity and analysis. Therefore, we stand ready to support them in improving their analytical capacity. 

The IMF and the CEF should continue working together to improve the technical capacities of government officials in the Western Balkans. Given the magnitude of economic and social challenges in the region and the high turnover of government officials in some of the countries, this requires continuing with CD and learning efforts. The IMF and the CEF collaborate to better understand the countries’ challenges and address them with their in-country and regional CD and learning activities. Being based at the CEF allows us to better collaborate and coordinate our activities while addressing our beneficiary countries’ PFM challenges. Interacting with the CEF’s international staff from the Western Balkans also helps us understand the region better.

2023 brings opportunities for new resolutions and wishes. What are yours regarding your work as well as personal life?

Jim Sørensen: At work, I wish to see that my investment of time and living in another country away from my children (they are grown up but still) and friends will pay off in change and improvements for future members of the EU. Last year I traveled a little too much for work, so this year my partner and I wish to be able to see different parts of Slovenia, and we have.

Yasemin Hurcan: Jim put the work-related wish perfectly – I couldn’t agree more. I also wish to see concrete improvements in the countries’ PFM systems during their EU accession journey. In addition to our continuing support, ownership from the authorities is crucial in CD. So, in 2023 I wish that government officials would implement many more of our recommendations to improve their PFM systems. 
Regarding personal wishes, I really hope to be able to spare more time for my family and explore this beautiful country and the region more.