Augusto Lopez Claros
Director
Global Indicators and Analysis Department
World Bank Group
June 28, Vienna
Financial & Private Sector Development
What does Doing Business measure?
Doing Business
•
Benchmarks 183 economies
•
Focuses on regulations relevant to the life
cycle of a small to medium-sized domestic
business in the largest business city
•
Is based on standardized case scenarios
•
The objective: efficient regulations,
accessible to all, and simple to implement
Doing Business DOES NOT measure all aspects of the business
environment such as macroeconomic stability, corruption, level of
labor skills, proximity to markets, or of regulation specific to foreign
investment or financial markets.
Financial & Private Sector Development
What do subnational and regional reports add?
Diagnostic tool
► Expand
the data beyond the
economy’s largest business city and/or
focus on regions with similar legal and
regulatory frameworks
• Create a baseline
• Pinpoint bottlenecks and provides
information on good practices
within the same economy and/or
region that can easily be replicated
1
• Capture reforms
Diagnostic
Tool
Reform instrument
• Allow specific locations to compete
locally and globally
2
Reform
Instrument
3
M&E
Device
• Promote peer to peer learning
• Motivate a reform process by
engaging local governments and
reforms stakeholders
M&E device
• Measure progress over time
through repeated benchmarking
• Create an incentive to maintain
reform effort even when
governments change
3
Financial & Private Sector Development
Doing Business in South East Europe 2011
Doing Business in South East Europe 2008
• Created a baseline for 15 subnational cities in
addition to the 7 cities representing their
respective economies in the annual report
Doing Business in South East Europe 2011
• Updates benchmarks for 18 cities
in 6 economies (all but Croatia) previously
measured
• Tracks business reforms in these cities
• Adds a new economy (Moldova) and 4 new
cities from Albania, FYR Macedonia and Moldova
• Data is current as of January 2011
Both reports cover 4 indicators
•
•
•
•
Starting a business
Dealing with construction permits
Registering property
Enforcing contracts
Financial & Private Sector Development
What locations does the report cover?
►7
economies and 22 cities
ALBANIA
MOLDOVA
Tirana*
Shkodra
Vlora
Durres
Chisinau*
Balti
BOSNIA AND
HERZEGOVINA
Podgorica*
Pljevlja
Nikšić
MONTENEGRO
Sarajevo*
Banja Luka
Mostar
SERBIA
Belgrade*
Zrenjanin
Kruševac
Užice
Vranje
KOSOVO
Pristina*
Prizren
FYR MACEDONIA
Skopje*
Bitola
Tetovo
* Largest business city
New city
Financial & Private Sector Development
5
What are the key findings?
 Remarkable progress in regulatory reform across the region
results in significant time and cost savings for entrepreneurs
•
It is easier do to business in all cities previously measured
•
Skopje (FYR Macedonia) and Banja Luka (Bosnia and Herzegovina)
most improved in the areas benchmarked
•
No single city or economy outperforms the others in all areas
•
The best overall improvement of the region is in the starting a business
area
•
Dealing with construction permits remains expensive in the region
•
Cities can learn from existing good practices across the region to
become more competitive nationally, regionally and globally
Financial & Private Sector Development
It is easier to do business in the 19 cities
previously measured
Number of cities that introduced or benefited from business reforms
since 2008
19
Starting a business
12
Registering property
Dealing with construction
permits
Enforcing contracts
9
8
Financial & Private Sector Development
Most improved—Banja Luka and Skopje
Reforms in 4 DB areas resulted in significant time savings for domestic entrepreneurs
Skopje (FYR Macedonia)
Time (days)
Banja Luka (Bosnia and Herzegovina)
Time (days)
Financial & Private Sector Development
Good practices are found across South East
European cities and economies
Economy
Albania
Bosnia and Herzegovina
Kosovo
FYR Macedonia
Moldova
Montenegro
Serbia
City
Durres
Shkodra
Tirana
Vlora
Banja Luka
Mostar
Sarajevo
Pristina
Prizren
Bitola
Skopje
Tetovo
Balti
Chisinau
Niksic
Pljevlja
Podgorica
Belgrade
Krusevac
Uzice
Vranje
Zrenjanin
Ease of
starting a
business
9
8
10
7
18
20
19
22
21
2
1
3
13
17
5
4
6
11
16
12
14
14
Ease of
dealing with
construction
permits
11
3
NO PRACTICE
9
3
13
9
17
6
12
2
3
8
19
1
6
18
21
20
16
13
13
Ease of
registering
property
13
9
16
10
21
22
19
18
14
3
15
6
1
1
6
4
20
16
10
10
5
6
Ease of
enforcing
contracts
14
11
18
10
15
20
19
21
22
5
9
3
4
2
17
7
16
11
11
6
7
1
Financial & Private Sector Development
South East Europe’s business entry averages
improved significantly
SEE Average 2008
26
22.3
SEE Average 2011
17
15
13
10
8
EU Average 2011
Skopje (FYR Macedonia)
6
5.7
3
3
1.5 Pjevlja (Montenegro)
Procedures (number)
Time (days)
Cost (% of GNI pc)
Financial & Private Sector Development
Starting a business: Consolidating requirements at
OSS made starting a business much faster in Skopje
Financial & Private Sector Development
Dealing with construction permits is
expensive
•
The number of procedures varies from 15 in
Pljevlja and Skopje to 30 in Chisinau
•
Pre-construction clearances take up the most
time
•
SEE is one of the most expensive regions in
the world: the average cost is 1,134% of
income per capita
Financial & Private Sector Development
Delays in property registration mainly due to
land registries and cadastres
Time
Financial & Private Sector Development
Fixed property transfer fees in Kosovo make
registering property affordable
Property transfer tax
Financial & Private Sector Development
Tetovo and Zrenjanin have the fastest
commercial dispute resolutions
Financial & Private Sector Development
A city adopting regional best practices
would rank 6th globally
Financial & Private Sector Development
Why does it matter?
Easier business entry means more new firms: evidence from
empirical research
Mexico
•
Impact of the reduction of registration procedures through the introduction of OneStop Shops and the elimination of federally required procedures
 Increase in the number of new firms of about 6%
 Increase in employment by 2.6%
 Consumer Price Index decrease by 1% due to competitive pressures of
new entrants
Colombia
•
Impact of the introduction of One-Stop Shops in 6 cities:
 Increase of 5.2% in the number of new firms
India
•
Impact of the elimination of License Raj in 16 states over 64 industries:
 Increase in the number of new firms by 6%
Financial & Private Sector Development
Thank you !
www.doingbusiness.org /SEE
Financial & Private Sector Development