Washington, D.C., November 4, 2010—Singapore, Hong Kong SAR China, and New Zealand lead the world in the ease of doing business for local firms, according to Doing Business 2011: Making a Difference for Entrepreneurs, the eighth in a series of annual reports published by IFC and the World Bank.
For the first time in eight years, the economies of East Asia and the Pacific were among the most active. Eighteen of 24 reformed business regulations and institutions in the past year—more than in any other region.
Emerging-market economies such as Indonesia, Malaysia, and Vietnam took the lead, easing business start-up, permitting, and property registration, and improving credit information sharing. Malaysia reduced the time and cost to transfer property by introducing more online services. Vietnam earned a spot among the 10 most-improved economies and moved up 10 places in the global rankings on the ease of doing business, to 78 among 183 economies.
New information technologies simplified business start-up, international trade, and property registration in Brunei Darussalam, Malaysia, the Philippines, and Samoa.
“New technology underpins regulatory best practice around the world,” said Janamitra Devan, Vice President for Financial and Private Sector Development at the World Bank Group. “Technology makes compliance easier, less costly, and more transparent.”
Since 2005, about 85 percent of the world’s economies have made it easier for local firms to operate, through 1,511 improvements to business regulation. China was among the 15 most-improved economies, having introduced in the past several years 14 regulatory changes that make it easier to do business—affecting nine areas covered by Doing Business.
Singapore has been the world’s top-ranked economy on the ease of doing business for five years running. Hong Kong SAR China held onto the number-two spot in part by increasing the efficiency of commercial dispute resolution. The Republic of Korea, Thailand, and Malaysia held onto their spots among the world’s top 25.
Globally, doing business remains easiest in OECD high-income economies and most difficult in Sub-Saharan Africa and South Asia. But developing economies are increasingly active. In the past year 66 percent of developing economies reformed business regulation; six years before, only 34 percent did.
About the Doing Business report series
Doing Business analyzes regulations that apply to an economy’s businesses during their life cycle, including start-up and operations, trading across borders, paying taxes, and closing a business. Doing Business does not measure all aspects of the business environment that matter to firms and investors. For example, it does not measure security, macroeconomic stability, corruption, skill level, or the strength of financial systems. Its findings have stimulated policy debates in more than 80 economies and enabled a growing body of research on how firm-level regulation relates to economic outcomes across economies.
For more information about the Doing Business report series, please visit: www.doingbusiness.org
About the World Bank Group
The World Bank Group is one of the world’s largest sources of funding and knowledge for developing countries. It comprises five closely associated institutions: the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA), the International Finance Corporation (IFC); the Multilateral Investment Guarantee Agency (MIGA); and the International Centre for Settlement of Investment Disputes (ICSID). Each institution plays a distinct role in the mission to fight poverty and improve living standards for people in the developing world. For more information, please visit www.worldbank.org, www.miga.org, and www.ifc.org.
About the World Bank Group
The World Bank Group is one of the world’s largest sources of funding and knowledge for developing countries. It comprises five closely associated institutions: the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA), the International Finance Corporation (IFC); the Multilateral Investment Guarantee Agency (MIGA); and the International Centre for Settlement of Investment Disputes (ICSID). Each institution plays a distinct role in the mission to fight poverty and improve living standards for people in the developing world. For more information, please visit www.worldbank.org, www.miga.org, and www.ifc.org.
Doing Business 2011 Fact Sheet – Summary of Reforms in East Asia and the Pacific
Brunei Darussalam made starting a business easier by improving efficiency at the company registrar and implementing an electronic system for name searches. It reduced the corporate income tax rate from 23.5 percent to 22 percent while also introducing a lower tax rate for small businesses, ranging from 5.5 percent to 11 percent. The introduction of an electronic customs system made trading easier.
Areas of business regulation reform: Starting a business, Paying taxes, Trading across borders
Cambodia eliminated preshipment inspections, reducing the time and number of documents required for importing and exporting.
Areas of business regulation reform: Trading across borders
In China a new corporate income tax law unified the tax regimes for domestic and foreign enterprises and clarified the calculation of taxable income for corporate income tax purposes.
Areas of business regulation reform: Paying taxes
Fiji made trading easier by opening customer care service centers and improving customs operations.
Areas of business regulation reform: Trading across borders
Hong Kong SAR, China, abolished the fuel tax on diesel. Reforms implemented in its civil justice system will help increase the efficiency and cost-effectiveness of commercial dispute resolution.
Areas of business regulation reform: Paying taxes, Enforcing contracts
Indonesia eased business start-up by reducing the cost of clearing and reserving a company name and the time required to reserve the name and approve the deed of incorporation. It also reduced its corporate income tax rate. The launch of a single-window service reduced the time required for exporting.
Areas of business regulation reform: Starting a business, Paying taxes, Trading across borders
The Lao People’s Democratic Republic replaced the business turnover tax with a new value added tax.
Areas of business regulation reform: Paying taxes
Malaysia eased business start-up by launching more online services. It reduced the time and cost to transfer property by introducing online stamping.
Areas of business regulation reform: Starting a business, Registering property
The Marshall Islands improved access to credit through a new secured transactions law that establishes a central collateral registry, broadens the range of assets that can be used as collateral, allows a general description of debts and obligations as well as assets granted as collateral, and establishes clear priority rules outside bankruptcy for secured creditors.
Areas of business regulation reform: Getting credit (legal rights)
In Papua New Guinea the operation of a new private credit bureau improved the credit information system.
Areas of business regulation reform: Getting credit (credit information)
The Philippines eased business start-up by setting up a one-stop shop at the municipal level. Improvements to its electronic customs systems, including the addition of functions such as electronic payments and online submission of declarations, reduced the time and cost to trade. But updated electricity connection costs made dealing with construction permits more difficult.
Areas of business regulation reform: Starting a business, Trading across borders, Dealing with construction permits (making it more difficult)
Samoa shifted from a deed system to a title system and fully computerized its land registry, which reduced the time required to register property by four months.
Areas of business regulation reform: Registering property
The Solomon Islands strengthened access to credit by passing a new secured transactions law that broadens the range of assets that can be used as collateral, allows a general description of debts and obligations secured by collateral, permits out-of-court enforcement, and creates a collateral registry.
Areas of business regulation reform: Getting credit (legal rights)
Taiwan, China, eased business start-up by reducing the time required to check company names, register retirement plans, and apply for health, pension, and labor insurance. It also reduced the corporate income tax rate and simplified tax return forms, rules for assessing corporate income tax, and the calculation of interim tax payments.
Areas of business regulation reform: Starting a business, Paying taxes
Thailand temporarily lowered taxes on business by reducing its specific business tax for 12 months. But it made registering property more costly by repealing a two-year temporary tax reduction for property transfers.
Areas of business regulation reform: Paying taxes, Registering property (making it more difficult)
Timor-Leste increased court efficiency by training and appointing new judges and passing a new civil procedure code.
Areas of business regulation reform: Enforcing contracts
Tonga simplified the payment of taxes by replacing a two-tier system with a 25 percent corporate income tax rate for both domestic and foreign companies and introducing tax incentives with a broad-based capital allowance system to replace tax holidays and other tax concessions.
Areas of business regulation reform: Paying taxes
Vietnam eased company start-up by creating a one-stop shop that combines the processes for obtaining a business license and a tax license and by eliminating the need for a seal for company licensing. A 50 percent reduction in the cost to register newly completed buildings, along with the transfer of the authority to register buildings from local authorities to the Department of National Resources and Environment, made dealing with construction permits easier. The credit information system improved: borrowers are now allowed to examine their own credit report and correct errors.
Areas of business regulation reform: Starting a business, Dealing with construction permits, Getting credit (credit information)
