Doing Business 2010
A
record in business regulation reform
This year reformers
were particularly active in Eastern Europe and Central Asia and the Middle East
and North Africa. In Doing Business 2010, there were four new reformers among
the top 10: Liberia, the United Arab Emirates, Tajikistan and Moldova. Others
include Colombia, Egypt, Belarus, the Former Yugoslav Republic of Macedonia, and
the Kyrgyz Republic. Colombia and Egypt have been top global reformers in four
of the past seven years
By WAVE Team
Source:
www.doingbusiness.org
Since 2004 Doing Business has been tracking
regulatory reforms aimed at improving the ease of doing business. Despite the
challenges presented by the financial crisis, the number of reforms hit a record
level this year. Between June 2008 and May 2009, 287 reforms were recorded in
131 economies, 20% more than the year before. Reformers focused on making it easier
to start and operate a business, strengthening property rights and improving the
efficiency of commercial dispute resolution and bankruptcy procedures.
Two
regions were particularly active this year: Eastern Europe and Central Asia and
the Middle East and North Africa. In Eastern Europe and Central Asia, 26 of the
region's 27 economies reformed business regulation in at least one area covered
by Doing Business. Governments in the Middle East and North Africa are reforming
at a similar rate, with 17 of 19 reforming in 2008/09. In both cases, competition
among neighbors helped inspire widespread reform.
Singapore, a consistent
reformer, is the top-ranked economy on the ease of doing business for the fourth
year in a row, with New Zealand as runner-up. But most of the action occurred
in developing economies. Two-thirds of the reforms recorded in the report were
in low- and lower-middle-income economies. For the first time a Sub-Saharan African
economy, Rwanda, is the world's top reformer of business regulation, making it
easier to start businesses, register property, protect investors, trade across
borders, and access credit.
Doing Business ranks economies based on 10
indicators of business regulation that record the time and cost to meet government
requirements in starting and operating a business, trading across borders, paying
taxes, and closing a business. The rankings do not reflect such areas as macroeconomic
policy, security, labor skills of the population or the strength of the financial
system or financial market regulations.
Once
again the most popular reform measure fell in the category of starting a business,
with three-quarters of economies making it easier to start a business. Paying
taxes was the next most popular category. The financial crisis has also prompted
governments to act in areas where regulatory reform may be more difficult and
require more time. During the past year 18 economies reformed their bankruptcy
regimes, including several economies in the hard-hit region of Eastern Europe
and Central Asia. In times of recession, keeping viable companies operating as
a going concern and preserving jobs becomes especially important.
Top
10 Reformers from Doing Business 2010
This year reformers were particularly
active in Eastern Europe and Central Asia and the Middle East and North Africa.
In Doing Business 2010, there were four new reformers among the top 10: Liberia,
the United Arab Emirates, Tajikistan and Moldova. Others include Colombia, Egypt,
Belarus, the Former Yugoslav Republic of Macedonia, and the Kyrgyz Republic. Colombia
and Egypt have been top global reformers in four of the past seven years.
For
the first time since Doing Business started tracking reforms, a Sub-Saharan African
economy, Rwanda, led the world in reforms. Rwanda has steadily reformed its commercial
laws and institutions since 2001. In the past year it introduced a new company
law that simplified business start-up and strengthened minority shareholder protections.
Entrepreneurs can now start a business in two procedures and three days. Rwanda
has also enacted new laws in order to improve regulations to ease access to credit.
Other reforms removed bottlenecks at the property registry and the revenue authority,
reducing the time required to register property by 255 days. Overall, Rwanda introduced
reforms in 7 out of the 10 categories, rising from 143rd to 67th place on the
ease of doing business rankings.
Every
one of the top ten reformers introduced measures to improve the ease of starting
a business, and 8 out of the 10 made it easier to deal with construction permits.
In Macedonia starting a business now takes four days, because the central registry
forwards relevant company information to other institutions. Several documents
no longer have to be notarized. Moldova offers an expedited, 24-hour company registration
service for an additional fee. Egypt and the United Arab Emirates have eliminated
minimum capital requirements.
Such reforms are timely. Many firms in developing
economies have suffered from lower demand for their exports and a drop in private
capital flows. At the same time businesses in low-income economies on average
still face more than twice the regulatory burden that their counterparts in high-income
economies do when starting a business, transferring property, filing taxes or
resolving a commercial dispute through the courts. Developed economies have on
average 10 times as many newly registered firms per adult as Africa and the Middle
East - and a business density four times that in developing economies.
(Published: 12.09.2009.)
