The Doing Business 2016 Report praises OHADA and OHADA member States
The 'Doing Business' Report says sub-Saharan Africa economies continue to implement reforms to improve the business climate for domestic entrepreneurs, with members of the Organization for the Harmonization of Business Law in Africa (OHADA) particularly active during the past year, says the World Bank Group's annual ease of doing business report.
'Doing Business 2016: Measuring Regulatory Quality and Efficiency', released today, reports a total of 69 reforms in 35 economies of sub-Saharan Africa. Of these, 14 of the 17 OHADA member countries implemented 29 reforms.
The reforms implemented in sub-Saharan Africa account for about 30 per cent of the 231 reforms implemented worldwide during the past year. The region also boasted half of the world's top 10 improvers, i.e. countries that implemented at least three reforms and moved up on the global rankings scale, with Uganda, Kenya, Mauritania, Benin, and Senegal.
Kenya and Uganda experienced significant increases in their rankings, with Kenya moving up to #108 this year, followed by Uganda, which has moved up to #122. These improvements are primarily due to four reforms Kenya implemented in the areas of 'Starting a Business', 'Getting Electricity', 'Registering Property', and 'Getting Credit', while Uganda implemented reforms in the areas of 'Starting a Business', 'Getting Electricity' and 'Getting Credit'.
The region stood out in implementing reforms under the 'Getting Credit' Indicator. Of the 32 reforms undertaken globally, 14 were carried out in Sub-Saharan Africa, with Kenya and Uganda making significant progress.
“Despite great improvements, governments in Sub-Saharan Africa will need to keep on working on closing the gap in many key areas that impact the ease of doing business. This especially applies to increasing access to reliable electricity and providing effective commercial dispute resolution systems - two areas where the region scores the lowest globally”, said Rita Ramah, Manager of the 'Doing Business' project.
On 'Getting Electricity', it takes an average of 130 days for an entrepreneur to get a new electricity connection and, once connected, customers experience frequent outages lasting almost 700 hours per year - making Sub-Saharan Africa the region with the highest duration of outages globally.
The region also ranks poorly in the areas of 'Trading Across Borders' and 'Registering Property'. Mauritius ranks best in the region, with a global ranking of 32, performing particularly well in the areas of 'Paying Taxes' and 'Enforcing Contracts'. In Mauritius, it takes only 152 hours for entrepreneurs to pay taxes, compared to 261 hours globally.
Rwanda has the next best ranking in the region, with a global ranking of 62. Rwanda also implemented the highest number of reforms in the region, with six reforms carried out over the past year. The country ranks second in the world on the 'Getting Credit' Indicator and 12th in the world on the 'Registering Property' Indicator. Ten years ago, an entrepreneur in Rwanda needed 370 days to transfer property. Now, it takes 32 days, which is less than in Germany.
Botswana, with a global ranking of 72, South Africa (73), and Seychelles (95) are also among the better-ranked economies in Sub-Saharan Africa. This year's report unveils a two-year effort to significantly expand the benchmarks used and measure the efficiency of business regulation. This implies including the time and cost of complying with government regulations, and more measurements of the quality of regulations, to better reflect the reality of business operations on the ground.
For five indicators that saw changes in this report - 'Dealing with Construction Permits', 'Getting Electricity', 'Enforcing Contracts', 'Registering Property' and 'Trading Across Borders' - Sub-Saharan Africa obtained lower scores than the global average.
The region's economies have room for improvement in the reliability of supply and transparency index of the 'Getting electricity' indicator and the quality of land administration index of the 'Registering property' Indicator. For instance, Uganda does not have an electronic database to monitor encumbrances or a geographic information system either. Also, the cadastre and land registry do not have complete coverage of the country's privately owned land.
The full report and accompanying data sets are available at: www.doingbusiness.org