JAKARTA (TheInsiderStories)  Indonesia’s East of Doing Business (EODB) global rank one step lower to 73rd rank compared to last year, says the World Bank Group’s Doing Business 2019: Training for Reform report, released on Wednesday (31/10). 

Little less on level but higher on point. World Bank stated that Indonesia’s EoDB index increase 1.42 bps to 67.96 bps.
World Bank calculation is based on government reformation in June 2017-May 2018. There are 10 indicators, such as starting a business, registering a property, and accessing loan.

Last year, the country rank at 72nd place from 91st position in 2017. In Indonesia, the reforms were aimed at easing the processes for starting a business, registering property, and improving access to credit. In Vietnam, improvements were made to make it easier to enforce contracts, pay taxes and start a business, said the Fund.

In the East Asia and Pacific region, China is among this year’s top 10 improvers, gaining more than 30 positions. It is now among the top 50 economies for the first time, at rank 46. While, Malaysia made a notable improvement by regaining its place in the world’s top 20 economies, moving up nine places to 15th rank.

Of the region’s 25 economies, two are among the world’s top 10 ranked economies – Singapore (in 2nd place) and Hong Kong SAR, China, which moves up one spot to 4th place. The region’s lowest ranked economies are Myanmar (171) and Timor-Leste (178).

Other large economies in the region and their rankings are Indonesia (73), the Philippines (124), Thailand (27) and Vietnam (69).  World Bank said, economies in the East Asia and Pacific region perform well in the areas of Dealing with Construction Permits (with an average rank of 79), Getting Electricity (also 79), and Getting Credit (80).

For an example, in the region, completing all the formalities to obtain electricity for a newly built warehouse takes on average 65 days and costs 625 percent of the per capita income, compared to 86 days and 1,229 percent globally.

Important challenges remain in the areas of Starting a Business (average rank of 99), Trading across Borders (101) and Enforcing Contracts (104), although there is wide variation between economies in the region.

Starting a new business takes one and a half days and costs 0.4 percent of income per capita in Singapore (ranked 3 globally in Starting a Business). However, it takes 174 days in Lao PDR (ranked 180 in Starting a Business) and it costs 47 percent of income per capita in Cambodia (185). 

Globaly, said the Fund, governments around the world set a new record in bureaucracy busting efforts for the domestic private sector, implementing 314 business reforms over the past year,

The reforms, carried out in 128 economies, benefit small and medium enterprises as well as entrepreneurs, enabling job creation and stimulating private investment. This year’s reforms surpass the previous all-time high of 290 reforms two years ago.

The private sector is key to creating sustainable economic growth and ending poverty around the world,” said World Bank Group President Jim Yong Kim in a written statement.

He continued, “Fair, efficient, and transparent rules, which Doing Business promotes, are the bedrock of a vibrant economy and entrepreneurship environment. It’s critical for governments to accelerate efforts to create the conditions for private enterprise to thrive and communities to prosper.”

The report finds that reforms are taking place where they are most needed, with low-income and lower middle-income economies carrying out 172 reforms. In Sub-Saharan Africa, a record number of 40 economies implemented 107 reforms, a new best in number of reforms for a third consecutive year for the region. The Middle East and North Africa region scaled a new high with 43 reforms.

The indicator Starting a Business continued to see the most improvements, with 50 reforms this year. Enforcing Contracts and Getting Electricity saw milestone reforms, with 49 and 26, respectively. In the World Bank Group’s annual ease of doing business rankings, the top 10 economies are New Zealand, Singapore and Denmark, which retain their first, second and third spots, respectively, for a second consecutive year, followed by Hong Kong SAR, China; Republic of Korea; Georgia; Norway; United States; United Kingdom and FYR Macedonia.

In notable changes to the top 20 ranked economies this year, the United Arab Emirates (UAE) joins the grouping for the first time, in 11th place, while Malaysia and Mauritius regain spots, in 15th and 20th places, respectively. During the past year, Malaysia implemented six reforms, Mauritius five, and the UAE four. The reforms in Mauritius included the elimination of a gender-based barrier to equalize the field between men and women in starting a business.

This year’s top 10 improvers, based on reforms undertaken, are Afghanistan, Djibouti, China, Azerbaijan, India, Togo, Kenya, Côte d’Ivoire, Turkey and Rwanda. With six reforms each, Djibouti and India are in the top 10 for a second consecutive year. Afghanistan and Turkey, top improvers for the first time, implemented record single-year reforms, with five and seven, respectively.

“The diversity among the top improvers shows that economies of all sizes and income levels, and even those in conflict can advance the business climate for domestic small and medium enterprises. Doing Business provides a road map that different governments can use to increase business confidence, innovation, and growth and reduce corruption,” said Shanta Devarajan, the World Bank’s Senior Director for Development Economics and Acting Chief Economist.

This year, Doing Business collected data on training provided to public officials and users of business and land registries. A case study in the report, which analyzes this data, finds that mandatory and annual training for relevant officials is associated with more efficient business and land registries.

A second study finds that regular training for customs clearance officials and brokers results in lower border and documentary compliance times, easing the movement of goods across borders. Two other case studies focus on the benefits of accrediting electricians and training of judges.

“This year’s results clearly demonstrate government commitment in many economies, large and small, to nurture entrepreneurship and private enterprise. If the reform agendas are complemented with training programs for public officials, the impact of reforms will be further enhanced, new data show,” said Rita Ramalho, Senior Manager of the World Bank’s Global Indicators Group, which produces the report.

Since its inception in 2003, more than 3,500 business reforms have been carried out in 186 of the 190 economies Doing Business monitors.

By region, East Asia and the Pacific is home to two of the world’s top 10 Doing Business economies, Singapore and Hong Kong SAR, China. Additionally, China is one of this year’s top 10 improvers, advancing more than 30 spots to 46th place in the global rankings. The region’s economies carried out a total of 43 reforms in the past year, with a major push seen in the areas of Starting a Business and Getting Electricity.

Europe and Central Asia also hosts two of the world’s top 10 economies this year, with Georgia moving up to 6th place (from 9th last year), and FYR Macedonia edging up one spot to 10th place. The region also hosts two of this year’s top improvers, Azerbaijan and Turkey. The pace of reforms accelerated in the region, with 54 reforms implemented during the past year, compared with a revised number of 43 reforms the previous year. While reforms in the region covered all areas of Doing Business, many improvements focused on easing construction permitting and cross border trade.

A total of 25 reforms were carried out in Latin America and the Caribbean in the past year. Brazil made the most improvements, with four reforms. The bulk of the reforms in the region were aimed at improving the legal rights of borrowers and lenders with respect to secured transactions, and the process of starting a business.

Economies of the Middle East and North Africa significantly accelerated the pace of reforms in the past year, with 43 reforms, compared to 29 the previous year. This year, the region hosts an economy in the global top 20 grouping, with the United Arab Emirates’ maiden entry in 11th place and one top improver, Djibouti. However, the region continues to lag on gender-related issues, with barriers for women entrepreneurs in place in 14 economies.

In a first for South Asia, two of the region’s economies earned coveted spots in the global top improvers. India continued its reform agenda, implementing six reforms in the past year and advancing 23 spots to 77th place in the global ranking. India is now the region’s top-ranked economy. Afghanistan, with five reforms, moved up 16 spots to 167th place in the global rankings. Collectively, the region’s economies carried out 19 reforms in the past year. Many of the reforms focused on improving starting a business, access to credit, paying taxes and resolving insolvency.

Sub-Saharan Africa set a new milestone for a third consecutive year, implementing 107 reforms in the past year, up from 83 the previous year. In addition, this year also saw the highest number of economies carrying out reforms, with 40 of the region’s 48 economies implementing at least one reform, compared to the previous high of 37 economies two years ago. The region is home to four of this year’s top 10 improvers – Togo, Kenya, Côte d’Ivoire and Rwanda. While reforms in the region were wide-ranging, many improvements focused on easing property registration and resolving insolvency.

Email: linda.silaen@theinsiderstories@gmail.com
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The Insider Stories Founder Linda Silaen has a solid, proven history, established over more than a decade as a journalist with a leading internasional news organization, of being the first with the biggest economic news stories in Indonesia. Specializing in corporate news, Linda is also a veteran of some of the biggest macroeconomic and general news stories as Indonesia rapidly transforms into a major market economy. One of the founders of the original blog from which this company developed, Linda’s knowledge of investors’ information communications and data us developed from unrivaled networking skills that make her a well-known name among CEOs, bankers, government officials and private equity investors both in Indonesia and other countries.

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