World Bank’s Doing Business Report 2016 Resume For Emerging Europe

Doing Business 2016

12 Macedonia
16 Estonia
20 Lithuania
22 Latvia
24 Georgia
25 Poland
29 Slovakia
29 Slovenia
35 Armenia
36 Czech Republic
37 Romania
38 Bulgaria
40 Croatia
42 Hungary
44 Belarus
46 Montenegro
52 Moldova
59 Serbia
63 Azerbaijan
66 Kosovo
79 Bosnia Herzegovina
83 Ukraine
97 Albania
Source: World Bank

Almost every single economy in emerging Europe implemented at least one reform in the last year to improve their business environment. In consequence, as many as 16 economies in the region are featured in the Top 50 of the World Bank’s Doing Business 2016 report. Emerging Europe speaks to Rita Ramalho, Manager of the World Bank–IFC Doing Business, who has compiled a resume about the emerging Europe region especially for us, about how the reforms introduced have helped make doing business easier across the region.

Which country is the biggest improver in the latest edition of the report?

Looking at the 22 economies, the biggest improver year-on-year [is] Serbia. Serbia bettered its Distance To Frontier (DTF) score from 65.25 (DB2015) to 68.41 (DB2016) over the past year, while the overall ranking also improved from 68th to 59th. It recorded this improvement in large part thanks to reforms in paying taxes and dealing with construction permits — two areas where Serbia made the most progress globally. This is also a considerable feat because only 33 per cent of economies worldwide reformed in two or more areas.

DB
Rita Ramelho, Manager, Doing Business Unit, World Bank Group (source: worldbank.org)

In terms of the reforms undertaken, Serbia made paying taxes easier for companies by introducing an electronic system for filing and paying VAT and social security contributions as well as by abolishing the urban land usage fee. As a result, the time to pay taxes decreased by 12 per cent. The other reform was in dealing with construction permits, which was made less costly for entrepreneurs in Belgrade  through the elimination of the land development tax for warehouses.

One would expect that EU countries would lead in improving their ranking but it is Macedonia that ranks first in the region. Armenia, Belarus and Montenegro are also in the Top 50. What have these countries done to improve their business climate?

Among the economies covered by Emerging-Europe.com, it is worth noting that the EU countries perform better than the non-EU ones on the ease of Doing Business. In fact, several economies in the former group are among the top 30: Estonia (rank of 16), Lithuania (20), Latvia (22), Poland (25), the Slovak Republic (29), and Slovenia (also 29). That said, it is indeed [the Republic of] Macedonia that leads in the ranking (12).

Macedonia sets some of the best practices worldwide in areas like starting a business, dealing with construction permits and paying taxes – all areas where the country is in the top 10 globally. On starting a business, for instance, Macedonia is the only economy with New Zealand where entrepreneurs can incorporate in one day or less. In dealing with construction permits, Macedonia scores almost full points (14 out of 15) on the quality control index that measures good practices in construction regulation and assesses the quality control and safety mechanisms.

Regarding Armenia (ranked 35), Belarus (44) and Montenegro (46), all three economies improved their DTF score over the past year thanks to multiple reforms. It should be noted that, going back to 2008, the economies have recorded one reform or more each year in the areas measured by Doing Business – with a particular emphasis on starting a business, getting credit, dealing with construction permits and paying taxes.

Do countries across the region share the same challenges as far as their business climate is concerned or does each country have their own challenges?

Each economy has its unique sets of challenges when it comes to business regulation. For instance, it takes only two days to start a business in Georgia (less than in Australia) compared to 67 days in Bosnia and Herzegovina. Similarly, it takes only 81 hours for a medium sized company in Estonia to comply with tax obligations, compared to 314 hours in Montenegro.

Notwithstanding the foregoing, it is interesting to observe that, in emerging Europe, there are some common challenges as well as strengths. Looking at the common challenges, economies have considerable room for improvement in the areas of dealing with construction permits (average indicator rank of 86th for the selected group of 22 economies) and getting electricity (86).

On dealing with construction permits, it takes an average of 15 procedures and 167 days in emerging Europe to deal with construction permitting and build a warehouse. In contrast, in OECD high-income economies it takes 12 procedures and 152 days.

On getting electricity, it takes an average of 119 days to get connected to the grid in emerging Europe, compared to 78 days in OECD high-income economies. This is partly because more interactions are required between government agencies and domestic firms (approximately six procedures in emerging Europe vs five in OECD high-income economies).

 

(Main photo: Belgrade, Serbia — courtesy of Tourist Organisation of Belgrade)

RELATED ARTICLES

Are Labour Shortages Driving Economic Growth?

Foreigners choose Minsk and Gomel as Belarus’ most attractive FDI destinations

Belarus Is Ready to Begin With Venture Capital Investments

Emerging Europe Live: Life in Belarus As Seen by Foreigners

Veni, Vidi, Vici, Or My Personal Experience of Doing Business in Belarus

The EU Is Encouraging Belarus to Join the World Trade Organisation

Belarus Is Making the First Steps onto the International Finance Floor

The essence of the Customs Union is protectionism

The Deep Roots of Currency Crises in the Former Soviet Union

Larisa Manastirli: Where is Bulgaria After Ten Years in the EU?

Economy Minister: Internationalisation Is the Key To the Slovenian Economy

The Reality in Romania Exposes False Perceptions Of The Country

The Belarusian Economy: The Challenges of Stalled Reforms

Breaking trade barriers with CIS has never been easier

OECD: Belarus Has to Find Its Own Belarusian Model to Emerge

Innovation Brings Great Opportunities to the Belarusian Economy

SEE Link — Sharing SEE Europe’s Hopes for a Brighter Investment Future

Germany Is Not Letting Belarus’ Small Downturns Put it off Looking for Investment Opportunities

FocusEconomics: Belarusian Economy to Grow in Q4 2016 and Onwards

Changes Are Making Ukrainian Banking More Aligned with International Standards

The Great Stone Industrial Park — Making Doing Business Easy in Minsk

Belarus Has To Make an Extra Effort To Change Investors’ Perceptions

The Proof of a Country’s Readiness to Attract Foreign Investors Lies in the Development of the Insurance Market

World Bank: Brexit Hides Greater Challenges to the European Union and the CEE Region

Will the New Five-day Visa-free Regime Encourage More Visitors to Belarus?

Fitch And the World Bank: Economic Growth To Remain Solid Within CEE In 2016

The UK and Belarus: A Partnership to Introduce the Real Belarus to Europe

Belarus Is Where the New Silk Road Heads For Europe

Young Well-Paid IT Specialists Are Making Belarus Known Internationally

Mayor: Armenia And Its Capital Yerevan Offer Safe Investment And Tourism To a Growing World

Lviv Is the Pearl and the Soul of Ukraine

Belarus’s Election Tests the EU’s Global Strategy

Business Opportunities in Belarus Encourage Outside Interest

Belarus: Changing Old Ideas And Mixing With the New in Belarus’ Export Market

Belarus-Turkey Investment Forum to increase investment and trade between the two countries

Lech Wałęsa: Hard Options Can Force Nations to Get Down to Work

Belarusian Tech Companies Lead a Global Technological Advance in Outsourcing and Product Development

Western Ukraine Could Be an Entry Point into the Country

Belarus is the most creative EEU country

Belarus Has Set an Example for Others to Follow

The EU’s Benign Neglect Of Eastern Europe

Invest in Belarus: looking beyond politics to the future

Belarusian Economy on a Diet to Change its Financial Outlook

The Next Four Months Crucial For the Belarus-EU Relations

Why Is Belarus Tech Booming?

Do Your Homework First and Starting Business in Poland is Easier

Cautious Upturn in Emerging Europe Haunted by the Spectre of Uncertainty

Donald Trump

The Belarusian Financial Sector: An Industry in the Process of Restructuring

EU Membership and Transition into Market Economies Have Helped CEE Achieve Social Progress

Kosovo: A Population of Talented Young Entrepreneurs Waits at Europe’s Door

PandaDoc — Rolling Sales Procedures Together So Everyone Succeeds

Long-time Neighbours Need to Share Awareness, Plus Trade & Investment

Macedonia — Stepping Out Of the Shadow Of the Balkans

Foreign Investors: Belarus Offers Opportunities But Further Improvements Are Needed

Belarus: On the Way to a Market Economy?

Falling Student Numbers and Declining R&D Result From Lack of Funds

New investors interested in Belarus’ Great Stone Industrial Park

Belarus Is One of the Top Outsourcing Destinations of 2016

HTP: Belarus’ Engineers Are Leading a Cool Revolution

Central And Eastern Europe At the World Property Market

Will European Business and Institutions Bolster the New Trends That Have Appeared in Belarus?

Belarus: The Importance Of Diversification

Not All Quiet on the Eastern Front

The Belarusian real estate market is on the up

High-Tech Park in Minsk is growing rapidly

Non-Financial Reporting No Longer a Secondary Consideration in CEE

Italy and Belarus: A Relationship Based on Complementarities and History

Belarus: Navigating the geopolitical storm

Belarus is Bringing Opportunities for European Companies

Great Stone

Belarus and Singapore Share the Same Factors for Economic Success

Emerging Europe and the EBRD host the Outlook on Belarus conference in London

Ukraine Is Offering Europe Unique Combat and Technological Experience

“e-Belarus”: Embracing the Internet and its Possibilities

After Economic Shocks Armenia Plans for Macroeconomic Stability

yerevan armenia minister of finance

Belarus 2020: Turning the Vicious Circle Into an Upward Spiral

‘No’ To a Monetary Union With Russia

Chris Lowney — What Jesuit Spirituality Can Teach Us About Global Leadership

Emerging Europe Live: CEE — The Outsourcing Destination

Smart, reliable and promising

Winds of Change for Belarus’ Reinsurance Industry?

Derek Chollet: There Is a Resurgence of Supporters of the Transatlantic Relationship

white house

Bringing Belarus’ Cultural Past to Life for Belarusians and the World

Encouraging SME’s Development Will Help Build Belarusian Economy

Brexit Is a Great Opportunity to Attract Foreign Investors to Belarus

EconMin: Bulgaria — Number One Outsourcing Destination And an Island of Stability in Europe

Belarusian Economic Recovery May Downgrade Intended Reforms for Competitiveness

The Belarusian Banking Sector Moving Towards Modernisation Despite Some Challenges

Germany and Belarus: Thinking Globally Acting Locally

Belarus US Business Relations Thrive as Conditions Improve

The Shopping Experience Is Set To Go Global in Belarus from 2017 Onwards

Lukashenka seeks to avoid commitment to Russia’s geostrategic goals

Leave a Reply

Your email address will not be published. Required fields are marked *