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PENELOPE BROOKActing Vice President

Financial and Private Sector DevelopmentThe World Bank Group

NairobiSeptember 30, 2009

http://subnational.doingbusiness.org

Doing Business – Overview

Doing Business measures the regulations applying to domestic small and medium-size companies through their life cycle

10 indicators in 183 countries

The objective: well-designed, streamlined regulations, accessible to all

Doing Business 2010 is the 7th report

More economies reform business regulations

More than 1,200 business regulation reforms tracked by Doing Business since 2004254 economies implemented start-up reforms171 of 183 economies reformed in at least one of 10 areas covered in Doing BusinessOver 270 reforms in 86 economies informed by Doing Business

89185 213 200 239 287

58 99 112 98 113 131

0100200300400

DB05 DB06 DB07 DB08 DB09 DB10

Reforms per Publication YearNumber of reformsEconomies

Subnational Doing Business

Expands the DB indicators beyond the most populous city Captures local differences in regulations or enforcement Includes rules and regulations at all levels of government Gives specific locations an opportunity to tell their storyProvides a tool for locations to compete globallyProvides information on good practices within the same country that can be easily replicatedCombines media appeal of DB with active participation of subnational governments in the reform process

5

Countries: 41

Cities: 299

Subnational Doing Business has projects all around the world

Doing Business in Kenya 2010

Four topics measured in Kenya:

Starting a business

Dealing with construction permits

Registering property

Enforcing contracts

Data were collected with the help of more than 115 private sector contributors and public

sector officials

Doing Business in Kenya 2010 covers 11 localities

Garissa

Kilifi

Mombasa

Thika

Nairobi

Isiolo

Nyeri

Narok

Kisumu

Malaba

Eldoret

Doing Business in Kenya 2010: Aggregate Rankings

1 Narok (easiest) 2 Malaba 3 Thika 4 Kisumu 5 Mombasa 6 Nyeri 7 Garissa 8 Eldoret 9 Kilifi10 Nairobi11 Isiolo (most difficult)

Time and cost to start a business in Kenya and selected economies and regions

Dealing with construction permits—potential for improvement

KENYA HIGHEST – 14 procedures (Garissa, Mombasa)

KENYA HIGHEST – 127 days (Isiolo)

KENYA HIGHEST – 284% (Kilifi)

Time to register property in Mombasa and Garissa

Enforcing contracts: lengthy delays during trial and judgment phase

“Kenyana” would jump from rank 95 to 78, if best practices were adopted

Indicator

Kenya’s global performance in Doing Business

2010 (represented by

Nairobi)

Best performing locality within

Kenya Best local practice

Global rank (183 economies)

How Kenyan localities would compare

globally

Number of procedures to build a warehouse 11 procedures Kisumu 10 procedures 9

Days to build a warehouse 120 days Narok 69 days 15Days to enforce a contract 465 days Malaba 330 days 23

Days to register property 64 days Mombasa 23 days 51

Cost to register property 4.2% of the property value Thika 4.1% of the property

value 78

Cost to build a warehouse

161.7% of income per capita Nyeri 132.4% of income

per capita 88

Days to start a business 34 days Nairobi 34 days 124

Cost to start a business 36.5% of income per capita Nairobi 36.5% of income per

capita 130

Number of procedures to register property 8 procedures All localities 8 procedures 136

Cost to enforce a contract

47.2% of the claim value Isiolo 38.4% of the claim

value 140

Number of procedures to start a business 12 procedures All localities 12 procedures 154

75%

9 reformers

90%

28 reformers

Number of states

2006 - 2007 2007 - 2008

► Great Impact • Political support for reform

efforts has continued even after two rounds of local elections and one presidential election since first benchmark

• 58 reforms recorded in 3 years

reformers Non reformers

Doing Business in Mexico 2005, 2007 & 2009

Competition and peer learning drive reforms

Improving business start up is associated with an increase in economic growth and investment rate.

Lowering barriers to entry correlate to less perceived corruption and a smaller informal sector.

Removing barriers to entry also gives opportunities of inclusion to youth and women.

Efficient property registration can make it easier to transfer property and can help boost the number of new title registrations.

Why does it matter?

Business regulation reform matters

Evidence from business start-up reform in MexicoEvaluation of impact on formal firm creation of a municipal reform which decreased the time to obtain an operation license from average 30 to 2 days in 93 municipalities.

Increase in new start-ups by about 4% (Kaplan, 2006)Increase in employment in eligible industries by 2.8% (Bruhn, 2008)

Indicative of how policy reform can lead to substantial real impact

For more information visit: www.doingbusiness.orgTHANK YOU

http://www.doingbusiness.org/Kenya http://subnational.doingbusiness.org

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