environment. Moreover, staying internationally competitive in a world of reduced capital flows, when financial markets have already become more discriminating, requires that governments undertake structural reforms in the areas that firms in their countries report as imposing the highest costs for their operation and expansion. For example, attracting private investment in infrastructure sectors such as electricity will be key, and this book highlights ways to do so efficiently without adding to the burden on public finances. At the same time, the state has the important task of continuing to strengthen institutions that provide essential public goods—from strong banking supervision and regulation of tertiary education to a working judicial system. The record of the past 10 years shows that transition countries can accomplish much in building institutions of the market economy. As they did 20 years ago, there is every reason to believe that countries in the region will rise to the challenges facing them today.
Overview
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