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• Ensuring not just easy FDI entry but also easy FDI exits; and• Effective intellectual property protection to encourage long-term FDI and the transferof innovative technologies.The presentation of Mr. Milicevic is given as Annex XI.Mr. D. Thomas Gochenour used the example of Ukraine vs. Russia, both of whichstarted from a similar position – a centralized power sector – and had substantial coalfiredsystems as of 1992. 4 The experience since 1992 has been highly contrasted.Russia liberalized the electric power sector, installed meters in the 1990s and beganto raise power tariffs. It also decided, by 2004, that it had to privatize the power generationsector in order to raise the investment capital needed to upgrade and expand thesystem. Russia felt it needed to do this because of the age of the power plants and theexpected strong demand growth that had already started to manifest. It completed thisprocess by 2008 and attracted some US$30 billion in new investment into the powersector, with four new state-of-the-art power plants being built since then.Ukraine, on the other hand, was slow to perceive the need for upgrading its powersector, even though coal was even more strategic for it than for Russia and the plantswere of the same age as that of Russia (also in poorer state of repair because ofUkraine’s relative poverty over the past 20 years). Ukraine does not have a policy tothis day for replacing or upgrading the old capacity and still does not seem to beconvinced that such a policy is needed before 2020. The country started privatizationof the power sector six years later than Russia and completed it only in 2012. Thisprivatization drive, however, did not attract new investment capital and most of thesystem was sold to one local oligarch at deeply knocked-down prices. Ukraine hasmaintained that the populace is too poor to afford the real market price of electricity.So an elaborate (and very costly) system of subsidization and cross-subsidies existsto this day with no definite plans in place to liberalize prices 5 , as political populisminsists on low energy prices. The power stations lost vast amounts of money for thepast several years and for nearly a decade hardly any new investment has come in.2. AfghanistanMr. Abdul Ghafar Rassin made a presentation titled “Investment Opportunities andOverview of Energy Sector in Afghanistan” and talked of the strong political commitmentthat exists currently in Afghanistan to foster FDI-led private sector growth, highlightingthe legal system that has been put in place to attract private investment. Afghanistanis a fast-growing economy with constitutional commitment to private investment andmarket economy. Hundred per cent foreign ownership is allowed and no discriminationis made between foreign and domestic investments. There is no restriction on inwardand outward capital flow and on profit and other cash repatriation. Import of capitalgoods and machinery is duty free and there is only 1 per cent duty on raw and intermediatematerials. He also highlighted financial incentives that an investor would receiveand pointed out the positive features of investing in Afghanistan. From an energyperspective these include: rapid economic growth and increasing demand for energy,4Russia has converted more of its power plants to gas-powered ones, and Ukraine hashad a large contribution from nuclear power generation.5Prices of both coal and electricity are set by the State.18