doing business in the middle east and north africa – with particular reference to iraq
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Doing Business in the Middle East and North Africa – with particular reference to Iraq. Presentation to Iraq Private Sector Development Center. Baghdad 12 November 2011. What does Doing Business measure?. Doing Business indicators: - PowerPoint PPT PresentationTRANSCRIPT
Doing Business in the Middle East and North Africa – with particular
reference to Iraq
Baghdad
12 November 20111
Presentation to Iraq Private Sector Development Center
What does Doing Business measure?
Doing Business indicators:
Focus on regulations relevant to the life cycle of a small to medium-sized domestic business.
Are built on standardized case scenarios.
Are measured for the most populous city in each country.
Are focused on the formal sector.
DO 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.
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3
Doing Business indicators – 11 areas of business regulation (9 included in the DB2011 ranking; 10 in DB2012)
Start-up Expansion Operations Insolvency Starting a
business
Minimum capital requirement,
procedures, time and cost
Registering property
Procedures, time and cost
Getting credit
Credit information systems
Movable collateral laws
Protecting investors
Disclosure and liability in related party transactions
Enforcing contracts
Procedures, time and cost to resolve a commercial dispute
Dealing with construction permits
Procedures, time and cost
Paying taxes
Payments, time and Total Tax Rate
Trading across borders
Documents, time and cost
Getting electricity
Procedures, time and cost
Employing workers (annex)
Resolving insolvency (formerly Closing a business)
Time, cost and recovery rate
Property rightsInvestor protectionAccess to credit
Entry Administrative burden Flexibility in hiring
Recovery rateReallocation of assets
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1. Singapore 16. Georgia2. Hong Kong SAR, China 17. Thailand3. New Zealand 18. Malaysia
4. United States 19. Germany
5. Denmark 20. Japan6. Norway 21. Latvia7. United Kingdom 22. Macedonia, FYR8. Korea, Rep. 23. Mauritius9. Iceland 24. Estonia10. Ireland 25. Taiwan, China11. Finland 26. Switzerland 12. Saudi Arabia 27. Lithuania13. Canada 28. Belgium14. Sweden 29. France15. Australia 30. Portugal
Top 30 economies for the ease of Doing Business in 2010/11
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Economies in the Middle East & North Africa on average have relatively efficient regulatory processes but weaker legal institutions
55
Middle East & North Africa ranking in Doing Business 2012 (Iraq 164)
170 164
148 144
134 131
110 104
99 96
94 93
67 49
46 38
36 33
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DjiboutiIraq
AlgeriaIran, Islamic Rep.
Syrian Arab RepublicWest Bank and Gaza
Egypt, Arab Rep.Lebanon
Yemen, Rep.Jordan
MoroccoMENA
KuwaitOman
TunisiaBahrain
QatarUnited Arab Emirates
Saudi Arabia
Easier to do business
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Middle East & North Africa economies score high in many areas of business regulation
Indicator World’s top ranked Middle East and North Africa’s top ranked
Starting a business New Zealand Saudi Arabia (10)Egypt, Arab Rep. (21)
Dealing with construction permits Hong Kong SAR, China Saudi Arabia (4)Bahrain (7)
Registering property Saudi Arabia Saudi Arabia (1)United Arab Emirates (6)
Getting credit Malaysia Saudi Arabia (48)Egypt and U.A.E. (78)
Protecting investors New Zealand Saudi Arabia (17)Kuwait (29)
Paying taxes Maldives Qatar (2)United Arab Emirates (7)
Trading across borders Singapore United Arab Emirates (5)Saudi Arabia (18)
Enforcing contracts Luxembourg Yemen, Rep. (38)Iran, Islamic Rep. (50)
Resolving Insolvency Japan Bahrain (25)Qatar (37)
Getting Electricity Iceland United Arab Emirates (10)Qatar (18)
77
Saudi Arabia
United Arab Emira
tes
BahrainQatar
TunisiaOman
Kuwait
Yemen, Rep.
Jordan
Morocco
Lebanon
Egypt, Arab Rep.
West
Bank and Gaza
Syrian Arab Republic
Iran, Is
lamic Rep.
Iraq
Algeria
Djibouti
0
20
40
60
80
100
120
140
160
180
Average rank across DB indicators
Average of lowest 3 topic rankings Average of all topic rankingsAverage of highest 3 topic ranking
UAE ranks 5 in Trading Across Borders, 6 in Register-ing Property, 7in Paying Taxes
Economy performance across different areas of business regulations can vary considerably
UAE ranks 151 in Resolving Insolvency, 134 in Enforcing Contracts, 122 in Protecting Investors
Globally, the pace of reforms making doing business easier is faster than ever before
11 of the 18 MENA economies improved their business regulations in 2010/11.
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18 regulatory reforms in 11 economies improved the business environment in the region
Jordan, Oman, Qatar, Saudi Arabia, Syrian Arab Republic, United Arab Emirates
Algeria, United Arab Emirates, Oman, Qatar
Morocco, Oman, Yemen
Djibouti, Jordan
MoroccoLebanon
1010
Several economies from the region stand out for improving their performance over time since 2005 – no improvement for Iraq since 2001*
Oman
Saudi Arabia
United Arab Emira
tesKuwait
Tunisia
LebanonJordan
Morocco
Iran, Is
lamic Rep.
West Bank and Gaza
Algeria
Yemen, Rep.
Iraq
Egypt, Arab Rep.
Syrian Arab Republic
Djibouti
0.20
0.25
0.30
0.35
0.40
0.45
0.50
0.55
0.60
0.65
*Bahrain and Qatar not included due to later inclusion in the DB dataset
Nar
row
ing
the
Dis
tanc
e to
the
Fron
tier f
rom
200
5 to
201
1 (p
erce
ntag
e po
ints
)
1111
Specific results for Iraq
1212
Ease of Doing Business- Iraq ranked 164 in 2012- Iraq ranked 159 in 2011
Doing Business indicators for Iraq in 2012: Starting a business - 176 Dealing with Construction Permits – 120 Getting Electricity – 46 Registering property – 98 Getting credit – 174 Protecting investors – 122 Paying taxes – 49 Trading across borders – 180 Enforcing contracts – 140 Resolving insolvency - 183
Specific results for Iraq
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Indicators where Iraq doing relatively well
Getting Electricity – 46This is a new indicator used for the first time in the Doing Business 2012 reportRelatively easy and quick to connect to the electricity grid – 5 procedures, taking 47 days costing 360% of GNI(But there is a chronic shortage of electricity in Iraq – this is a key issue in Iraq)
Paying taxes – 49Iraq less reliant on business taxation than most other countries because if it reliance on oil revenues. Iraq’s business taxation system is relatively simple, 13 payments per year, taking 312 hours with tax rate of 28.4% of profit
Specific results for Iraq
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Indicators where Iraq doing relatively less well
Starting a business – 17611 procedures, taking 77 days to register, costing 115% of per capita income, with minimum capital of 35 per cent of par capita incomeAn important indicator and a major constraint for informal businesses entering the “formal economy”
Trading across borders - 180Requiring 10 documents, 80 days to get approval, cost $3550 per containerAn important indicator illustrating major impediments to Iraq integrating with the World economy
Resolving insolvency (formerly closing a business) – 183Businesses in Iraq cannot be closed
Specific results for Iraq
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Support for Doing Business reforms in Iraq
USAID-Tijara (with support from other partners) leading in supporting DB reforms for:Starting a business, Registering property, Getting credit, Protecting investors, Resolving insolvency
World Bank Group (with support from other partners) leading in supporting DB reforms for:
Dealing with construction permits (IFC), Trading across borders and Enforcing contracts (WB)
Support for Doing Business reforms in Iraq relatively recent. Progress to date has been very slow, in part, because two or more ministries are typically involved in regulating each indicator and because of institutional resistance to reforms
Thank you.
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For more information:www.doingbusiness.org