According to World Bank’s annual Doing Business report, Kenya and Uganda are among the economies that implemented at least three reforms during the past year and moved up the ranking scale.
The report revealed that 85 developing economies implemented 169 business reforms during the past year, compared with 154 reforms the previous year. High-income economies carried out an additional 62 reforms, bringing the total for the past year to 231 reforms in 122 economies around the world.
A majority of these new reforms, the report adds, were designed to improve the efficiency of regulations, by reducing their cost and complexity, with the largest number of improvements made in the area of Starting a Business. This includes how long it takes to obtain a permit for starting a business and its associated processing costs.
A total of 45 economies, 33 of which were developing economies, undertook reforms to make it easier for entrepreneurs to start a business. India, for example, made significant improvements by eliminating the minimum capital requirement and a business operations certificate, saving entrepreneurs an unnecessary procedure and five days’ wait time.
“Kenya also made business incorporation easier by simplifying pre-registration procedures, reducing the time to incorporate by four days,” reads a statement from World Bank.
Among the economies that implemented at least three reforms during the past year and moved up the rankings scale are Costa Rica, Uganda, Kenya, Cyprus, Mauritania, Uzbekistan, Kazakhstan, Jamaica, Senegal, and Benin.
“A modern economy cannot function without regulation and, at the same time, it can be brought to a standstill through poor and cumbersome regulation. The challenge of development is to tread this narrow path by identifying regulations that are good and necessary, and shunning ones that thwart creativity and hamper the functioning of small and medium enterprises. The World Bank Group’s Doing Business report tracks the regulatory and bureaucratic systems of nations by conducting detailed annual surveys. For policymakers faced with the challenge of creating jobs and promoting development, it is well worth studying how nations fare in terms of the various Doing Business indicators,” said Kaushik Basu, World Bank Chief Economist and Senior Vice President.
The report also notes the increasing use of the internet for entrepreneurs to interact with the government, given the potential economic benefits of providing online electronic services across all areas measured by Doing Business.
In the past year, 50 reforms were aimed at providing or improving online tax payment systems, import-export document processing, and business and property registration, amongst others.
According to the Director of the World Bank’s Global Indicators Group – the firm that produces the report – Mr. Augusto Lopez-Claros there is persuasive research that shows how efficiency and quality of business regulations go hand-in-hand with producing more competitive, viable companies and firms that help to grow national economies.
“The increased emphasis on the quality of regulation, to complement the previous focus on efficiency is aimed at providing greater clarity between well-designed and badly-designed regulations, making it easier to identify where regulation is enabling businesses to thrive and where it has the opposite effect,” said Augusto Lopez-Claros.
From the rankings, Kenya emerged in position 108 globally, Nigeria (169), and Uganda (122). The lowest rankings are Eritrea (189), South Sudan (187), and the Central African Republic (185). Rwanda ranks among the best in the world in Getting Credit (2) and Registering Property (12).
Written by Kawira Mutisya
