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Business Regulations Improved in Sub-Saharan Africa: Mozambique Slips in this Year’s Doing Business Ranking

October 20, 2011

Washington D.C., October 20, 2011— A new report from IFC and the World Bank finds that a record number of economies in Sub-Saharan Africa improved business regulations for local entrepreneurs in the past year. Released today, Doing Business 2012: Doing Business in a More Transparent World assesses regulations affecting domestic firms in 183 economies and ranks the economies in 10 areas of business regulation, such as starting a business, resolving insolvency, and trading across borders. This year, the rankings on the ease of doing business have been expanded to include indicators on getting electricity.

Over the past year a record number of governments in Sub-Saharan Africa changed their economy’s regulatory environment to make it easier for domestic firms to start up and operate. In a region where relatively little attention was paid to the regulatory environment only few years ago, business-friendly regulatory reforms were implemented in 36 of 46 economies between June 2010 and May 2011. That represents 78% of the economies in the region, compared with an average of 56% over the previous 6 years.

While the pace of regulatory improvements has picked up across Sub-Saharan Africa, Mozambique’s ranking has deteriorated to the position 139, from 132 in the last year’s (2011) report.

“In addition to methodological changes, the decline in Mozambique’s ranking also reflects the fact that no reforms were actually enacted during the period covered by this report, which is unfortunate given the authorities’ stated priority to improve the climate for business and to create more jobs. We trust the Government will do its upmost to hasten the pace of reforms in order to improve the country’s overall economic prospects; diversify the economy; and create jobs, as prioritized in the Government’s own Poverty Reduction Strategy (PARP), which we intend to support through our forthcoming Country Partnership Strategy for the years 2012-15,” said Laurence Clarke, World Bank Country Director for Mozambique, Angola, and Sao Tomé and Principe. “It’s important to note that Doing Business is a dynamic ranking. If a country stays still it falls behind since other economies continue to reform.”

New data from this year’s report show that improving access to information on business regulations can empower the entrepreneurs in knowing their responsibilities and rights, as well as facilitate them in navigating through complex regulatory systems. For example, in many Sub-Saharan African economies, getting essential information often requires meeting with an official. Improving access to information contributes to more efficient operation of firms and remains as a priority area for improving the business environment.

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 resolving insolvency. The aggregate ease of doing business rankings are based on 10 indicators and cover 183 economies. Previous year’s rankings are back-calculated to account for the addition of new indicator(s), data corrections, and methodology changes in existing indicators so as to provide a meaningful comparison with the new rankings.  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, the level of skills, 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.

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), which together form the World Bank; 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.

Media Contacts
In Sub-Saharan Africa
Lucie Cecile Giraud
Tel : +254 717 717 910
Aby K. Toure
Tel : +1 (202)473-8302
In Angola, Mozambique and São Tomé and Principe
Rafael Saute
Tel : +258 21 48 29 44