Ministry of Commerce And Supplies - Enhanced Integrated ...

N T I S2010Lack of up-to-date policies, institutional weaknesses, and many ineffective sector committees and boardshave all contributed to Nepal’s poor performance in investment and trade and should be addressed by theGoN going forward.‘Doing Business’ in NepalThe World Bank’s Doing Business 2010 indicators for Nepal provide a quantitative measure to evaluate theregulations in Nepal for starting a business, dealing with construction permits, employing workers, registeringproperty, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts andclosing a business, as they apply to domestic enterprises and ranked against performance of 183 economiesaround the world. A fundamental premise of the Doing Business related research is that investment andtrade require good rules and an attractive macro-level legal and regulatory framework. These include rulesthat establish and clarify property rights and reduce the costs of resolving disputes, rules that increase thepredictability of economic interactions, and rules that provide contractual partners with core protectionsagainst abuse.Table 5.2 shows Nepal’s performance in the Doing Business surveys of 2009 and 2010. The objective is tohighlight Nepal’s position relative to other countries and, where necessary, encourage the government todesign regulations that are efficient, accessible to all companies, and simple in their implementation.Table 5.2Ease of Doing Business in Nepal, 2009 and 2010Ease of... Doing Business 2010 rank Doing Business 2009 rank Change in rankDoing Business 123 123 0Starting a Business 87 75 -12Dealing with Construction Permits 131 130 -1Employing Workers 148 147 -1Registering Property 26 29 +3Getting Credit 113 109 -4Protecting Investors 73 70 -3Paying Taxes 124 111 -13Trading Across Borders 161 159 -2Enforcing Contracts 122 122 0Closing a Business 105 105 0Source: World Bank Doing Business Nepal 2010.The following conclusions can be drawn from the data:1. Overall Doing Business rank, which can be considered a proxy indicator of conditions for investors inNepal, has remained practically unchanged (Nepal ranked 123rd worldwide in 2010 and 2009). Nepalneeds to undertake reforms more actively or face further deterioration of its position;2. Nepal ranks particularly weak in a number of areas directly relevant to investment and trade: tradingacross borders (rank 161); employing workers (rank 148); securing construction permits (rank 131);paying taxes (rank 124); and enforcing contracts (rank 122). In addition, performance in some of theseindicators is slipping.152NEPAL TRADE INTEGRATION STRATEGY 2010BACKGROUND REPORT