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

16 Doing Business 2009Table 3.3Who regulates construction permits the least—and who the most?Procedures (number)FewestDenmark 6 Azerbaijan 31New Zealand 7 Hungary 31Vanuatu 7 Brunei 32Sweden 8 Guinea 32Chad 9 Tajikistan 32Maldives 9 El Salvador 34St. Lucia 9 Czech Republic 36Grenada 10 China 37Jamaica 10 Kazakhstan 38Kenya 10 Russian Federation 54Time (days)Fasteststop shop for building permits.In Zimbabwe and Benin, obtainingbuilding permits became more difficult.In Zimbabwe’s capital, Harare, employeeshave been leaving the constructionadministration. With fewer trained professionalsto review applications, gettinga building plan approved by the citycouncil can now take a year.In Cotonou, Benin, it now takesabout 180 days to obtain a buildingpermit—3 months longer than it usedto—because of administrative backlogs.A new regulation released in June 2007MostSlowestKorea 34 Cameroon 426Finland 38 Suriname 431Singapore 38 Ukraine 471United States 40 Lesotho 601Vanuatu 51 Côte d’Ivoire 628Marshall Islands 55 Iran 670Bahrain 56 Russian Federation 704Solomon Islands 62 Cambodia 709New Zealand 65 Haiti 1,179Belize 66 Zimbabwe 1,426Cost (% of income per capita)LeastQatar 0.8 Ukraine 1,902United Arab Emirates 1.5 Tanzania 2,087St. Kitts and Nevis 5.1 Serbia 2,178Brunei 5.3 Russian Federation 2,613Trinidad and Tobago 5.5 Guinea-Bissau 2,629Palau 5.9 Niger 2,694Malaysia 7.9 Burundi 8,516St. Vincent and the Grenadines 8.4 Afghanistan 14,919Thailand 9.4 Zimbabwe 16,369Hungary 10.3 Liberia 60,989Source: Doing Business database.Mostsets statutory time limits of 120 days forbuilding permits. But these time limitshave yet to be enforced.Eastern Europe and Central Asiasaw many reforms, though only halfof them easing the regulatory burden.In Croatia a new building code eliminatedthe need for a building permitfor smaller projects and eased the requirementsfor larger ones. Now midsizecommercial construction projectsno longer need clearances from the firedepartment, water and sewerage authorities,telephone company, labor inspectorateand sanitary authority—cutting 5procedures.In Bosnia and Herzegovina administrativeimprovements made it easierto obtain cadastre excerpts, required forbuilding permits, and to register newbuildings in the cadastre and land bookregistry. That cut the time from 467 daysto 296. In Belarus new statutory timelimits for pre-permitting procedures andbuilding permits reduced the time by140 days. In Armenia companies nolonger have to pay “charitable contribution”fees to obtain the designing right.That cut the cost by 383.3% of incomeper capita.Several economies went the otherway. In Serbia the wait for building permitsincreased by an average 75 days. InUkraine a regulation introduced in 2007requires businesses to pay a “contribution”to infrastructure development thatamounts to 15% of construction costs.Now builders in Kiev can expect to pay1,902% of income per capita to deal withconstruction-related formalities.In East Asia, Hong Kong (China)pursued a broad program that eliminated8 procedures and cut the time forconstruction permits by more than 5weeks, ranking it among the top reformersglobally. In 2006 the government,working with the private sector, createda cross-sector consultation teamto identify ways to improve permittingprocedures. Working groups started withagencies and companies operating inthe construction sector found redundantprocedures, improved communicationand coordination schemes and identifiedregulatory “easy fixes” that couldimprove efficiency. “This is a very cleverand pragmatic approach—somethingvery much in touch with our culture,”comments the owner of a local constructioncompany.Singapore reduced the time fordealing with construction permits bytwo-thirds in 2007/08—more than anyother economy in the world. The agenciesresponsible for approvals cut theirinternal time limits by half. To save moretime, the Building and Construction Au-(c) The International Bank for Reconstruction and Development / The World Bank