Singapore is the world''s easiest place to do business, while Kazakhstan introduced the most pro-business reforms this year, according to the World Bank''s "Doing Business" report on Wednesday. The annual World Bank report tracks changes in 183 countries when it comes to starting a business, cross-border trading, paying taxes, investor protection, dealing with construction permits, employing workers and access to credit.
In the year since June 2009, 117 economies introduced 216 pro-business reforms, less than in the previous 12 months when 131 countries implemented 287 changes. Neil Gregory, director for indicators and analysis at the World Bank, said while the number of overall reforms fell, the momentum to beef up business regulations was still strong.
"There has been a steady build up in regulatory changes in areas we track," he told reporters. Singapore has held the title as the world''s easiest place to do business for the past five years, followed by Hong Kong, New Zealand, Britain, United States, Denmark and Canada.
While doing business remains easiest in advanced economies, the World Bank report showed that two-thirds of the reforms implemented over the past year were in developing countries. Of the top 10 economies that improved the most Rwanda was toppled by Kazakhstan this year. The small east African country took second place followed by Peru, Vietnam, Cape Verde, Tajikistan, Zambia, Hungary, Grenada and Brunei.
Kazakhstan nabbed the title for biggest reformer with its efforts to amend its company law, introduce regulations to streamline the process of starting up a business and reducing capital requirements. It also made dealing with construction permits less cumbersome, while traders benefits from a new automated customs information system.
Gregory said countries like Kazakhstan have struggled to develop their private sectors and attract investment and the reforms would help boost competitiveness. He said new among the mix of active reformers this year was larger economies such as Peru, Vietnam and Hungary that since the global financial crisis have focused more on developing domestic sectors rather than relying on foreign direct investment.
"Prior to the economic crisis these countries relied more on FDI and following the crisis and downturn in global demand they are trying to develop more domestic enterprises serving local markets," he added. East Asia and Pacific countries were the most energetic reformers by region for the first time in the eight years that the report has been published. Some 18 of 24 governments in the region introduced reforms, more than in any other year.
The report said the pace of reforms in the region had picked up since 2006 when just one-third of the region''s economies introduced changes. In the past year, 75 percent did, with Indonesia, Malaysia and Vietnam leading the pack.
"Even though East Asia escaped the financial crisis, countries in the region see the need to rely less on exports and promote more domestic consumption, that is why I see a lot of attention to business regulation reforms," Gregory said.
Despite being the region hardest hit by the financial crisis, Eastern Europe and Central Asia maintained its strong pace of reforms that began in 2004, the report said, with 21 of 25 economies reforming business regulation.
Do reforms make a difference? Compared with advanced economies, starting a business takes 4 times as long on average in Latin America and the Caribbean and costs 18 times as much in Africa.
When it comes to dealing with construction permits - the time and cost for businesses to obtain approvals to build - it is easiest in Hong Kong followed by Singapore, and most difficult in Malawi and Burundi. Overall 19 economies made it easier to deal with construction permits with Africa accounting for most of those reforms, the report said.
Access to finance for small and medium-sized businesses is easiest in Malaysia but toughest in Syria, the report said. Investors are most protected in New Zealand, Singapore and Hong Kong and Malaysia, but have least protection in Guinea, Gambia, Micronesia, Palau and Vietnam. When it comes to paying taxes, it is easiest in the Maldives, Qatar and Hong Kong, but toughest in Jamaica and Panama.
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