Sub-Saharan Africa economies adopted a record number of business reforms for a second consecutive year, says the 15th anniversary edition of the World Bank Group’s annual Doing Business report, which monitors the ease of doing business for small and medium enterprises around the world.

A total of 83 business reforms were carried out in the past year, surpassing the previous year’s record of 80 reforms. This brings to a total of 798 the number of reforms carried out in the past 15 years in the 48 economies of the region monitored by Doing Business 2018: Reforming to Create Jobs, released today.

The region is well represented in this year’s global top 10 improvers, based on reforms undertaken, with Malawi; Nigeria; and Zambia. Malawi, which implemented four reforms, made significant improvements in the area of Getting Credit by adopting a new law that sets clear rules related to bankruptcy procedures and by establishing a new credit bureau. Nigeria also improved access to credit by guaranteeing borrowers the right to inspect their credit data from the credit bureau and also made starting a business faster by allowing electronic stamping of registration documents. Reforms in Zambia also included the strengthening of access to credit by adopting a new Movable Property Act and by setting up a new collateral registry.

Much of the reform activity in the past year focused on the areas of Trading Across Borders and Starting a Business, with 15 reforms each, followed by Dealing with Construction Permits, where 14 reforms accounted for 64 percent of the 22 reforms recorded in this area globally. Zambia implemented a global automated system for customs data (ASYCUDA), making it easier for businesses to trade across borders, while Angola and Mozambique made trading across borders easier by improving port infrastructure.  

Several economies, including Benin, Cabo Verde, the Democratic Republic of Congo, Gabon, Ghana, Niger, Nigeria and the Seychelles increased the transparency of dealing with construction permits by publishing regulations related to construction online. Angola also made dealing with construction permits easier and less time-consuming by improving its system for building permit applications.

Kenya implemented the most reforms in the region in the past year, with six. Among other improvements, Kenya made starting a business easier by reducing the number of procedures required to register a business, and reduced the time for import documentary compliance by utilizing a single window system. Kenya also improved the reliability of electricity supply by investing in distribution lines and transformers and by setting up a specialized squad to restore power when outages occur and implemented an online platform (itax) for filing and paying corporate income tax.

Four other economies –  Mauritania, Nigeria, Rwanda and Senegal – implemented five reforms each during the past year. Rwanda, which is second only to New Zealand in Registering Property, implemented online services to further facilitate property transfers. As a result, it now takes only seven days to legally transfer a property title in Rwanda.

Notable reforms in Senegal included the introduction of stricter pre-trial hearing rules that led to a reduction of the time necessary to resolve a commercial dispute. These new rules have reduced the time to enforce a contract from 925 days to 740 days. Senegal also made starting a business and registering property less costly by reducing the notary fees for company incorporation and lowering the costs of transferring property, respectively.

Mauritius, the region’s top-ranked economy, carried out four reforms, which included outsourcing the design and construction of sewerage connection works, thus, speeding up the process of obtaining a construction permit and improving processes to facilitate cross border trade. Mauritius also made it easier to transfer property by reducing the transfer tax, implementing a complaint mechanism and publishing service standards.

In the ease of doing business global rankings, Mauritius is in 25th place, followed by Rwanda (41), and Kenya (80) as the region’s top ranked economies.

The Sub-Saharan Africa region continues to struggle in the area of Getting Electricity. On average, obtaining an electricity connection takes 115 days in the region, compared to the global average of 92 days.

“The reform effort in Sub-Saharan Africa is singularly worth celebrating, as the region is beset with myriad crises, including conflict and violence. We hope to continue recording the region’s successes in enabling entrepreneurship to address the challenge of job-creation, particularly for the region’s millions of young women and men,” said Rita Ramalho, Acting Director of the World Bank’s Global Indicators Group, which produces the report.

Highlights of the region’s economies’ successes over the past 15 years include:

• Making it easier to register a business has been a major focus for the region in the 15 years since Doing Business was first published, with 163 reforms recorded in this area. In 2003, it took 61 days on average to start a business in the region. Today, it takes 24 days, which compare with the global average of 20 days. In Kenya, for example, the time needed to start a business has been more than halved from 60 days in 2003, to 25 days today.

• In the area of Enforcing Contracts, Rwanda reduced the time to settle a commercial dispute from 395 days 15 years ago, to 230 days today. In Resolving Insolvency, Zambia increased the recovery rate from 17 cents on the dollar in 15 years ago, to 48 cents on the dollar today.

• The biggest reformers in the region have been Rwanda, with 52 reforms in 15 years, followed by Kenya with 32 reforms and Mauritius with 31 reforms.

Trading across Borders

Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures – documentary compliance, border compliance and domestic transport – within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017.

Where do the region’s economies stand today?

How easy it is for businesses in economies in Sub-Saharan Africa (SSA) to export and import goods? The global rankings of these economies on the ease of trading across borders suggest an answer. The average ranking of the region and comparator regions provide a useful benchmark.*

How economies in Sub-Saharan Africa (SSA) rank on the ease of trading across borders

* The top 10 ranked countries in the SSA region, along with South Africa, Nigeria and the regional average, are shown here.

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Doing Business records nearly 3,200 reforms in 15 years to improve business climate worldwide

Governments in 119 economies carried out 264 business reforms in the past year to create jobs, attract investment and become more competitive, says the World Bank Group’s latest Doing Business 2018 report.

Marking its 15th anniversary, the report notes that 3,188 business reforms have been carried out since it began monitoring the ease of doing business for domestic small and medium enterprises around the world.

“Job creation is one of the transformational gains that countries and communities can achieve when the private sector is allowed to flourish. Fair, efficient and transparent rules, which Doing Business promotes, improve governance and tackle corruption,” said World Bank Chief Executive Officer Kristalina Georgieva.

Developing countries carried out 206 reforms, accounting for 78 percent of the total reforms, with Sub-Saharan Africa implementing 83 reforms, a record for a second consecutive year for the region, and South Asia implementing a record 20 reforms. A large number of reforms centered on improving access to credit and registering a new business, with 38 reforms each, as well as facilitating cross border trade, with 33 reforms.

In its annual ease of doing business rankings, New Zealand, Singapore and Denmark retained their first, second and third spots, respectively, followed by Republic of Korea; Hong Kong SAR, China; United States; United Kingdom; Norway; Georgia; and Sweden.

This year’s top 10 improvers, based on reforms undertaken, are Brunei Darussalam (for a second consecutive year); Thailand; Malawi; Kosovo; India; Uzbekistan; Zambia; Nigeria; Djibouti; and El Salvador. For the first time, the group of top 10 improvers includes economies of all income levels and sizes, with half being top improvers for the first time – El Salvador, India, Malawi, Nigeria, and Thailand.

“Public policy plays a decisive role in enabling small and medium businesses to start, operate and expand. Governments around the world are increasingly turning to Doing Business for objective data to underpin their actions. More importantly, the fact that Doing Business is transparent and publicly available means that citizens can hold governments accountable for reforms that benefit firms, households, and society at large,” said Shanta Devarajan, the World Bank’s Senior Director for Development Economics.

Since its inception, Doing Business has recorded business reforms in 186 of the 190 economies it now monitors. Rwanda has implemented the highest number of business reforms over the past 15 years, with a total of 52 reforms, followed by Georgia, which advanced this year into the top 10 ranked economies (47 reforms) and Kazakhstan and the Former Yugoslav Republic of Macedonia (41 reforms each).

Easing the requirements for Starting a Business has seen the largest number of reforms, with 626 reforms recorded in the past 15 years. As a result, the time needed to start a new small or medium business has more than halved to an average of 20 days worldwide, compared with 52 days in 2003. In addition, in 65 economies, entrepreneurs can complete at least one business incorporation procedure online, compared with only nine in 2003. Similar progress is also seen in other Doing Business areas.

“As we celebrate the 15th anniversary of Doing Business, it is particularly gratifying to see that many of the reforms are being carried out in economies and sectors where they are most needed. We look forward to continuing to shine a light on the real hurdles faced by entrepreneurs, both women and men, and celebrating policy change successes,” said Rita Ramalho, Acting Director of the World Bank’s Global Indicators Group, which produces the report.

The report also monitors hurdles faced specifically by women in the areas of Starting a Business, Registering Property and Enforcing Contracts. This year’s report records a welcome reform by the Democratic Republic of Congo, which eliminated the requirement for women to obtain their husband’s permission to register a business. However, 36 economies continue to place obstacles for women entrepreneurs, with 22 economies imposing additional steps for married women to start a business and 14 limiting women’s ability to own, use and transfer property.

This year’s report includes two case studies on transparency, which analyze data from business registries and land administrations and find that economies with more transparent and accessible information have lower levels of corruption and bribery. A third case study on private sector participation in formulating construction regulation finds that such rules exhibited higher costs and a propensity for conflicts of interest. A fourth case study highlights three successful insolvency reforms in France, Slovenia and Thailand, and lessons that are transferable to other economies.

By region, economies in East Asia and the Pacific implemented 45 reforms in the past year. The region is home to two of the world’s top 10 ranked economies, Singapore and Hong Kong SAR, China, and two of this year’s top 10 improvers, Brunei Darussalam and Thailand. In the past 15 years, the region has implemented 371 reforms. As a result, the time needed to start a new business has been more than halved to 24 days now, from 50 days in 2003.

The Europe and Central Asia region implemented 44 reforms during the past year. The region is host to a top ranked economy, with Georgia in ninth place, and two of this year’s top improvers, Kosovo and Uzbekistan. In the past 15 years, the region has been an active reformer, with 673 reforms implemented. It now takes 10.5 days to register a new business in the region, compared with 43 days in 2003.

A total of 26 reforms were carried out in the Latin America and the Caribbean region, with El Salvador earning a spot among this year’s top improvers for the first time. The region has implemented 398 reforms in the past 15 years. Now, starting a business in the region takes on average 38 days, compared to 78 days 15 years ago.

The economies of the Middle East and North Africa implemented 29 reforms in the past year. The region has implemented 292 reforms in the past 15 years. As a result, it takes 17 days on average to start a business in the region, compared to 43 days in 2003. However, the region lags on gender-related issues, with 14 economies imposing additional barriers for women entrepreneurs.

In South Asia, 20 reforms were implemented by six of the region’s eight economies. India carried out eight reforms, the highest number for the country in a single year. Over the past 15 years, the region has implemented 127 reforms. Fifteen years ago, it took over 50 days on average to start a business in the region, compared to 17 days now.

Reform activity continued to accelerate in Sub-Saharan Africa, with 36 economies implementing 83 business reforms in the past year. The region is home to three of this year’s top 10 improvers – Malawi, Nigeria, and Zambia. Over the past 15 years, the region has implemented 798 reforms. In 2003, it took 61 days on average to start a business in the region, compared to 22.5 days today.

The full report and its datasets are available at www.doingbusiness.org.