DOING BUSINESS 2009 - JOHN J. HADDAD, Ph.D.

More documents

Recommendations

Info

7%Cut or simplified postregistration proceduresNote: A reform may include several reform features.10 Doing Business 2009Source: Doing Business database.FIGURE 2.3Starting a business in Azerbaijangets faster and cheaperTime and cost to start a business2004Time (days)1220Cost(% of income per capita)14.402005 2006 2007 200811412.3Source: Doing Business database.529.3Time cutby 87%Cost cutby 77%306.9163.229%. 3 One reason for these large effectsmay be that reducing entry costsincreases entry pressure, pushing firmswith lower productivity out of the market.Indeed, a study on business entryin Mexico finds that competition fromnew entrants lowered prices by 1% andreduced the income of incumbent businessesby 3.5%. 4Simpler and faster business entrymakes it easier for workers and capitalto move across sectors when economiesexperience economic shocks. A recentstudy of 28 sectors in 55 countries comparessectoral employment reallocationin the 1980s and 1990s. The finding: reallocationis smoother in countries where ittakes fewer days to start a business. 5 Thisfinding is confirmed by many studies onthe effect of entry regulation in economiesopening their product markets to trade. 6The explanation is simple: with high fixedcosts of entry, firms cannot easily moveinto the industries benefiting the mostfrom trade openness. This friction reducesthe value of greater openness.Recognizing such benefits, economiesaround the world have been developinginnovative solutions to ease theentry of new firms into the market. Asone company registrar put it, “At the endof the day, we all have the same goal.”Yet as Doing Business shows, companyregistration is often only one pieceof the puzzle. In many economies entrepreneurshave to visit at least 7 agenciesbefore they can get down to business.The most efficient economies focuson creating a single interface betweengovernment and entrepreneur to takecare of all necessary registrations andnotifications, mainly commercial andtax registration. Entrepreneurs in NewZealand, for example, have to file all necessaryinformation only once—becauseagencies are linked through a unifieddatabase. There is no minimum capitalrequirement. And no judge has to approvethe creation of a company.Who reformed in 2007/08?In 2007/08, 49 economies made it easierto start a business—more reforms thanin any previous year (table 2.2). Onehighlight of the reforms: entrepreneursin Canada and New Zealand can nowstart a business with a single onlineprocedure.Yemen reformed business start-upthe most. In 2007 it had the second largestminimum capital requirement in theworld at $15,225 (2,003% of income percapita). This is now gone, reduced tozero. That’s not all. Yemen also activatedits one-stop shop, making it possible tocomplete all steps—from reserving thecompany name to obtaining a license forincorporation to announcing the company’sformation—in a single location.It made it easier to obtain a license fromthe municipality and to register with thechamber of commerce and the tax office.And it publicized the fact that a companyseal is not mandatory. The reforms reducedthe number of procedures to starta business by 5, and the time by 50 days.Slovenia was the runner-up in businessstart-up reforms. It simplified businessregistration by introducing a singleaccess point, making company informationavailable online and eliminatingcourt fees and the requirement to registerat the statistical office. The changesreduced the procedures by 4, the time by41 days and the cost by 8.4% of incomeper capita.Senegal is among the 14 economiesthat made Africa the leading regionin start-up reforms. Senegal’s one-stopshop became fully operational, merging7 start-up procedures into 1. Start-uptime fell from 58 days to 8. Liberia toostreamlined business registration, cutting3 months from the time. Businessescan now start in less than 1 month. Liberiaalso made the process more affordable,making the use of lawyers optional.Table 2.2Simplifying registration formalities—the most popular reform feature in 2007/08Simplified other registration formalities(seal, publication, notary, inspection,other requirements)Created or improved one-stop shopIntroduced or improved onlineregistration proceduresAbolished or reduced minimum capitalrequirementCut or simplified postregistration proceduresSource: Doing Business database.Bangladesh, Botswana, Bulgaria, Costa Rica,El Salvador, Georgia, Ghana, Hungary, Kenya, KyrgyzRepublic, Liberia, former Yugoslav Republic ofMacedonia, Moldova, Namibia, Saudi Arabia, Syria,YemenAlbania, Angola, Azerbaijan, Belarus, Bulgaria, CzechRepublic, Italy, Lebanon, Lesotho, former YugoslavRepublic of Macedonia, Oman, Senegal, Slovakia,Slovenia, Yemen, ZambiaBulgaria, Canada, Colombia, Dominican Republic,Hungary, Italy, former Yugoslav Republic ofMacedonia, Malaysia, Mauritius, New Zealand,Panama, Senegal, SingaporeBelarus, Egypt, El Salvador, Georgia, Greece,Hungary, Jordan, Tunisia, Uruguay, YemenColombia, Madagascar, Mauritania, Sierra Leone,South Africa, Tonga, West Bank and Gaza(c) The International Bank for Reconstruction and Development / The World Bank
STARTING A BUSINESS 11The cost is a fourth of what it used to be.Madagascar also focused on cost, abolishingthe professional tax.Sierra Leone and South Africamade the use of lawyers optional. SouthAfrica also introduced electronic meansof certifying and publishing companydocuments. In Botswana and Namibiaentrepreneurs now benefit from computerizedregistration systems. Zambiarevamped the company registry andcreated a one-stop shop. So did Lesotho,reducing start-up time by 33 days.Burkina Faso continued reforms at itsone-stop shop, CEFORE. Ghana officiallyeliminated the requirement for a companyseal. Angola, Kenya, Mauritaniaand Mauritius also reformed.Eastern Europe and Central Asiasaw reform in 10 economies. Six reducedthe running-around time for entrepreneursby creating one-stop shops. Albaniatook registration out of the courtsand merged company, social security,labor and tax registrations. Before, entrepreneurshad to wait more than amonth to start doing business; now it’sjust 8 days. Azerbaijan’s one-stop shopreduced delays by 2 weeks, Slovenia’s by6. Bulgaria, the Kyrgyz Republic and theformer Yugoslav Republic of Macedoniaundertook reforms similar to Azerbaijan’s.And while Czech entrepreneurs stillhave to obtain multiple documents, thenew “Project Czech Point” allows themto do so at one place.Belarus activated a unified registrationdatabase and cut the minimum capitalrequirement by half. Georgia eliminatedthe minimum capital requirementaltogether. It also cut the requirementfor a company seal and made the use ofnotaries optional. Moldova introduced 2new laws, on limited liability companiesand company registration, and tightenedtime limits. In contrast, Bosnia andHerzegovina increased the time to starta business by tightening notarizationrequirements.The Middle East and North Africamade big strides in reform. Syria was thesecond biggest reformer in the region,behind Yemen. A new company law andTable 2.3Who regulates business start-up the least—and who the most?Procedures (number)FewestMostCanada 1 Greece 15New Zealand 1 Montenegro 15Australia 2 Philippines 15Belgium 3 Venezuela 16Finland 3 Guinea-Bissau 17Georgia 3 Brazil 18Sweden 3 Brunei 18Bulgaria 4 Uganda 18Denmark 4 Chad 19Singapore 4 Equatorial Guinea 20Time (days)FastestSlowestNew Zealand 1 Lao PDR 103Australia 2 Brunei 116Georgia 3 Equatorial Guinea 136Belgium 4 Venezuela 141Singapore 4 São Tomé and Principe 144Canada 5 Brazil 152Hungary 5 Congo, Dem. Rep. 155Iceland 5 Haiti 195Denmark 6 Guinea-Bissau 233Mauritius 6 Suriname 694Cost (% of income per capita)LeastMostDenmark 0.0 Benin 196.0Slovenia 0.1 Angola 196.8Ireland 0.3 Djibouti 200.2New Zealand 0.4 Burundi 215.0Canada 0.5 Central African Republic 232.3Bahrain 0.6 Togo 251.3Sweden 0.6 Gambia, The 254.9United States 0.7 Guinea-Bissau 257.7Singapore 0.7 Zimbabwe 432.7United Kingdom 0.8 Congo, Dem. Rep. 435.4Paid-in minimum capitalMost% of incomeper capitaUS$Burkina Faso 459 1,973Oman 461 51,282Guinea 477 1,907Central African Republic 514 1,953Djibouti 514 5,602Togo 560 2,016Ethiopia 694 1,526Niger 702 1,966Guinea-Bissau 1,015 2,030Syria 4,354 76,627Note: Sixty-nine economies have no paid-in minimum capital requirement.Source: Doing Business database.(c) The International Bank for Reconstruction and Development / The World Bank
Page 2 and 3: (c) The International Bank for Reco
Page 4 and 5: © 2008 The International Bank for
Page 6 and 7: (c) The International Bank for Reco
Page 8: vi Doing Business 2009• Doing Bus
Page 11 and 12: ABout doing business ix13. For exam
Page 13 and 14: OverviewFIGURE 1.1Which regions hav
Page 15 and 16: FIGURE 1.3Who reformed the most in
Page 17 and 18: overview 53612AlbaniaAzerbaijanBots
Page 19 and 20: overview 7procedures and 4 days. Ne
Page 21: South Asia(8 economies) 6Note: A rS
Page 25 and 26: STARTING A BUSINESS 13Creating a on
Page 27 and 28: DEALING WITH CONSTRUCTION PERMITS 1
Page 29 and 30: thority’s new data management sys
Page 31 and 32: North Africa1(19 economies)FIGURE 4
Page 33 and 34: Employing workers 21Table 4.2Easing
Page 35 and 36: Employing workers 23Increasing flex
Page 37 and 38: REGISTERING PROPERTY 25Table 5.2Red
Page 39 and 40: Steps for encumbrance checking, dee
Page 41 and 42: FIGURE 6.1GETTING CREDITCambodia le
Page 43 and 44: (19 economies)Note: A reform is cou
Page 45 and 46: incomeincomeSource: Doing Business
Page 47 and 48: PROTECTING INVESTORS 35Enterprises,
Page 50 and 51: (8 economies)2Note: A reform is cou
Page 52 and 53: tax rateSource: Doing Business data
Page 54 and 55: FIGURE 8.3Profit taxes lowest, but
Page 56 and 57: 44 Doing Business 2009OverviewStart
Page 58 and 59: 46 Doing Business 2009ECDhighcomeEC
Page 60 and 61: 48 Doing Business 2009Table 9.3Who
Page 62 and 63: 50 Doing Business 2009Table 10.2Whe
Page 64 and 65: 400Source: Doing Business database.
Page 66 and 67: 54 Doing Business 2009OverviewStart
Page 68 and 69: FIGURE What 11.3are the reform tren
Page 70 and 71: 58 Doing Business 2009ReferencesAgh
Page 72 and 73:
60 Doing Business 2009Africa’s De
Page 74 and 75:
62 Doing Business 2009Alternatively
Page 76 and 77:
64 Doing Business 2009government of
Page 78 and 79:
66 Doing Business 2009workers and c
Page 80 and 81:
68 Doing Business 2009• Has no tr
Page 82 and 83:
70 Doing Business 2009The index ran
Page 84 and 85:
72 Doing Business 2009• Whether f
Page 86 and 87:
74 Doing Business 2009Tax paymentsT
Page 88 and 89:
76 Doing Business 2009CostCost meas
Page 90 and 91:
78 Doing Business 2009Recovery rate
Page 92 and 93:
80 Doing Business 2009ment in the r
Page 94 and 95:
82 Doing Business 2009EconomyStarti
Page 96 and 97:
84 Doing Business 2009EconomyStarti
Page 98 and 99:
86 Doing Business 2009AFGHANISTAN S
Page 100 and 101:
88 Doing Business 2009ARMENIA Easte
Page 102 and 103:
90 Doing Business 2009BANGLADESH So
Page 104 and 105:
92 Doing Business 2009BOLIVIA Latin
Page 106 and 107:
94 Doing Business 2009BURKINA FASO
Page 108 and 109:
96 Doing Business 2009CENTRAL AFRIC
Page 110 and 111:
98 Doing Business 2009CONGO, DEM. R
Page 112 and 113:
100 Doing Business 2009DENMARK OECD
Page 114 and 115:
102 Doing Business 2009EL SALVADOR
Page 116 and 117:
104 Doing Business 2009FINLAND OECD
Page 118 and 119:
106 Doing Business 2009GHANA Sub-Sa
Page 120 and 121:
108 Doing Business 2009GUYANA Latin
Page 122 and 123:
110 Doing Business 2009INDIA South
Page 124 and 125:
112 Doing Business 2009ITALY OECD:
Page 126 and 127:
114 Doing Business 2009KIRIBATI Eas
Page 128 and 129:
116 Doing Business 2009LEBANON Midd
Page 130 and 131:
118 Doing Business 2009MADAGASCAR S
Page 132 and 133:
120 Doing Business 2009MAURITANIA S
Page 134 and 135:
122 Doing Business 2009MONTENEGRO E
Page 136 and 137:
124 Doing Business 2009NEW ZEALAND
Page 138 and 139:
126 Doing Business 2009PAKISTAN Sou
Page 140 and 141:
128 Doing Business 2009PHILIPPINES
Page 142 and 143:
130 Doing Business 2009RUSSIAN FEDE
Page 144 and 145:
132 Doing Business 2009SERBIA Easte
Page 146 and 147:
134 Doing Business 2009SOLOMON ISLA
Page 148 and 149:
136 Doing Business 2009ST. VINCENT
Page 150 and 151:
138 Doing Business 2009SYRIA Middle
Page 152 and 153:
140 Doing Business 2009TOGO Sub-Sah
Page 154 and 155:
142 Doing Business 2009UKRAINE East
Page 156 and 157:
144 Doing Business 2009VANUATU East
Page 158 and 159:
146 Doing Business 2009ZIMBABWE Sub
Page 160 and 161:
148 Doing Business 2009Ratification
Page 162 and 163:
150 Doing Business 2009Ratification
Page 164 and 165:
152 Doing Business 2009GLOBAL CONTR
Page 166 and 167:
154 Doing Business 2009Mark SwanPri
Page 168 and 169:
156 Doing Business 2009Dirk Van Str
Page 170 and 171:
158 Doing Business 2009Iassen Hrist
Page 172 and 173:
160 Doing Business 2009Marie-Edith
Page 174 and 175:
162 Doing Business 2009Bertrand Fle
Page 176 and 177:
164 Doing Business 2009Hussein Mahm
Page 178 and 179:
166 Doing Business 2009Steeve Romua
Page 180 and 181:
168 Doing Business 2009Estuardo Enr
Page 182 and 183:
170 Doing Business 2009Mayur Ghadia
Page 184 and 185:
172 Doing Business 2009Federico Gua
Page 186 and 187:
174 Doing Business 2009Zharkymbai B
Page 188 and 189:
176 Doing Business 2009Suzana Stojk
Page 190 and 191:
178 Doing Business 2009Odmaa Khurel
Page 192 and 193:
180 Doing Business 2009Diaouga Haou
Page 194 and 195:
182 Doing Business 2009Marco Antoni
Page 196 and 197:
184 Doing Business 2009of Ius Labor
Page 198 and 199:
186 Doing Business 2009Cecil French
Page 200 and 201:
188 Doing Business 2009St. LuciaTha
Page 202 and 203:
190 Doing Business 2009Sakares Kham
Page 204 and 205:
192 Doing Business 2009Şule Tunal
Page 206 and 207:
194 Doing Business 2009Valeria Samb
Page 208 and 209:
(c) The International Bank for Reco
Page 210 and 211:
(c) The International Bank for Reco
show all

DOING BUSINESS 2009 - JOHN J. HADDAD, Ph.D.

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?