Part v: Prepare to adapt

It is unwarranted to think that all dimensions to a major constraint on economic activity are binding at the same time. They will change. As a developing economy grows, its market and regulatory institutions change and their capabilities increase. As a result, growth strategies and policies and the role of government shift. In short, while there may be one immediate major constraint that requires immediate attention, this will change and evolve requiring focus elsewhere on 'new' constraints. Policy development and the EO's position needs to reflect this reality.

The EO may have started by advocating a change in policy but concluded that there are some issues where the government is going to proceed in a different direction to the wishes of the EO, irrespective of the evidence that it can provide.

If for example the government has included in its campaign platform higher regulation on temporary employment agencies (in response to some real or perceived concerns) then it is highly likely this will happen. An EO is probably engaging in a futile battle to stop this happening, it will waste political capital and probably goodwill in such an exercise.

If that seems likely, it is better to accept the issue as it stands and move on for the following reasons:

  • If the government is determined to pursue a particular course of action that the EO did not want, for example to regulate, then the EO may well want to shift focus from opposing the regulation to trying to influence its content, in order to minimise the burden on its members;
  • relationships need to be preserved; fighting every issue to a standstill is not a sustainable strategy, nor an effective one. If an issue the EO is advancing has hit an insurmountable wall, call it a day and move on to the next issue.

As far as possible examine unintended outcomes from the EO's proposal. For example, there can be negative consequences even from a positive course of corrective action. For instance, imagine that energy monopolies have been identified as the most significant cost for business. The EO (and others) over time successfully lobbies for the privatisation of this sector but the existing providers in a monopoly situation may well have become inefficient and uncompetitive by global standards. Opening the sector up carries the risk of short-term bad economic outcomes (e.g., immediate layoffs / closure) notwithstanding the longer-term macro gain. However, this may in itself generate political resistance, perhaps even leading to a change of government and further resistance to reforms identified by the EO.