Presentation - Doing Business

Peter Ladegaard
Regional Program Manager
Investment Climate Advisory Services in
East and Southern Africa
Zanzibar Town
March 22, 2011
Doing Business compares business
regulation in 183 economies
 Launched 8 years ago
 Focuses on regulations relevant to
the life cycle of a small to mediumsized domestic business based on a
standardized case
 Does not measure all aspects of the
business environment
 The objective: efficient regulations,
accessible to all, and simple to
What Subnational Doing Business adds
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 story
Provides a tool for locations to compete globally
Provides information on good practices within the same country
that can be easily replicated
Combines media appeal of DB with active participation of
subnational governments in the reform process
Where do we work?
Countries: 43
Cities: 339
Doing Business in Zanzibar 2011
Creates a baseline for Zanzibar
Covers 9 indicators:
Starting a business
Dealing with construction permits
Registering property
Getting credit
Protecting investors
Paying taxes
Trading across borders
Enforcing contracts
Closing a business
Includes global comparisons and
reform recommendations
Zanzibar’s global ranking varies by topic
Starting a business could be simplified
28 days
Post-incorporation procedures take up 80% of the time
Dealing with construction permits—time,
cost and procedures
65 days
Obtaining a building permit and connecting to electricity are the biggest
Registering property is costly
It costs 20.2% of property value to register and transfer property in
Getting credit—no coverage of information
due to lack of a credit bureau
Protecting investors—minority
shareholder rights
► New company law in Rwanda strengthens investor protection
Paying taxes—time, number of payments
and total tax rate
Trading across borders—preparing and
obtaining documents lengthy
29 days to import
US$ 1,192 per container
22 days to export
US$ 844 per container
Enforcing contracts—Zanzibar ranks 2nd
among 35 small island economies
Closing a business—no practice
Formal bankruptcy procedures are rarely or never
used in Zanzibar
Only a few cases of winding ups since 2002
Doing Business methodology—at least 5 cases a year
within the last 5 years
Zanzibar is classified as a “no practice” economy
Why business regulation reform matters
Easier business entry means more new firms: evidence from empirical
Impact of the reduction of registration procedures through the introduction of One-Stop 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
Impact of the introduction of One-Stop Shops in 6 cities:
 Increase of 5.2% in the number of new firms
Impact of the elimination of License Raj in 16 states over 64 industries:
 Increase in the number of new firms by 6%
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