in south east europe 2008 pierre guislain director, investment climate department and general...

in South East Europe 2008

Pierre GuislainPierre Guislain Director, Investment Climate Department and

General Manager FIAS

July 14th, 2008Bitola

Doing Business project

• Update of 2008

• Research program on

regulation and

business opportunities

for women

• FDI indicator

• Starting a business

• Dealing with licenses

• Employing workers

• Registering property

• Getting credit

• Protecting investors

• Paying taxes

• Trading across borders

• Enforcing contracts

• Closing a business

2009• Update of 2007

• Add 3 countries

• Reformer’s Club:

• 11 case studies

20082007

South East Europe countries among the world’s top reformers in DB 2008

Closing a

business

Enforcing

contracts

Trading

across

borders

Paying taxes

Protecting

investors

Getting credit

Registering

property

Employing

workers

Dealing with

licenses

Starting a

business

10.Bulgaria

9.China

8.Kenya

7.Saudi Arabia

6.Colombia

5.Georgia

4.Macedoni

a FYR

3.Ghana

2.Croatia

1.Egypt

• Expands Doing Business indicators beyond the most populous city

2. Reform

instrument

1. D

iagn

ostic

tool

3. M&E device

• Creates baseline• Allows local and global

benchmarking• Puts regulatory reform

on political agenda• Links national and

local reform efforts

1. Diagnostic tool • Comparisons within cities

are strong drivers of reform • Uncovers bottlenecks and

local good practices• Promotes peer to peer

learning • Actively involves local

governments and other reform stakeholders

2. Reform instrument

3. M&E device

•Measures progress over time

•Creates an incentive to maintain reform effort even when governments change

•High media appeal

Subnational Doing Business project

Doing Business in South East Europe

*Under UN Security Council Resolution 1244 (1999), Kosovo is administered by the United Nations Interim Administration Mission in Kosovo (UNMIK).

Indicators:

• Starting a Business

• Registering Property

• Construction Licenses

• Enforcing Contracts

ZrenjaninKruševac

UžiceVranje

Belgrade

PljevljaNikšić

Podgorica

BitolaSkopje

ŠibenikOsijek

VaraždinZagreb

ShkodraVloraTirana

Banja LukaMostar

Sarajevo

PrizrenPriština

*

22 cities covered, 6 of which are also covered by

the global Doing Business report

Where is it easiest doing business in South East Europe?

1. Bitola, Macedonia, FYR (easiest)

2. Zrenjanin, Serbia

3. Shkodra, Albania

4. Pljevlje, Montenegro

5. Krusevac, Serbia

6. Vlora, Albania

7. Osijek, Croatia

8. Prizren, Kosovo

9. Skopje, Macedonia, FYR

10. Uzice, Serbia

11. Tirana, Albania

12. Pristina, Kosovo

13. Belgrade, Serbia

14. Vranje, Serbia

15. Varazdin, Croatia

16. Sibenik, Croatia

17. Niksic, Montenegro

18. Podgorica, Montenegro

19. Zagreb, Croatia

20. Banja Luka, Bosnia and Herzegovina

21. Sarajevo, Bosnia and Herzegovina

22. Mostar, Bosnia and Herzegovina

Starting a business in Albania takes 6 procedures and 7 days

02468

1012141618202224262830323436

Companyname

Notary Identif.number

Chamberof

Comm.

Regist.with

Municip.

Company seal

Initialcapital

Fiscalcertif.

LaborInspect-

orate

Socialsecurity

Time (days)

18

2

✘13

0

September 2007

October 2007

Time to start a business (days)

7

7

8

10

12

16

18

20

20

22

23

25

28

29

31

34

37

39

40

51

54

61

Shkodra (Albania)

Vlora (Albania)

Tirana (Albania)

Bitola (Macedonia, FYR)

Skopje (Macedonia, FYR)

Pljevlje (Montenegro)

Prizren (Kosovo)

Niksic (Montenegro)

Podgorica (Montenegro)

Pristina (Kosovo)

Belgrade (Serbia)

Uzice (Serbia)

Vranje (Serbia)

Krusevac (Serbia)

Sibenik (Croatia)

Osijek (Croatia)

Zrenjanin (Serbia)

Varazdin (Croatia)

Zagreb (Croatia)

Banja Luka (Bosnia and Herzegovina)

Sarajevo (Bosnia and Herzegovina)

Mostar (Bosnia and Herzegovina)Denmark(6 days)

Slovakia(25 days)

Slovenia (60 days)

Days to deal with construction licenses

535

467

414

390

332

323

306

304

295

253

252

225

204

202

198

197

192

190

188

183

15194

0 50 100 150 200 250 300 350 400 450 500 550

Mostar (Bosnia and Herzegovina)


Uzice (Serbia)

Zagreb (Croatia)

Tirana (Albania)

Varazdin (Croatia)


Krusevac (Serbia)

Osijek (Croatia)

Vranje (Serbia)

Sibenik (Croatia)

Vlora (Albania)

Belgrade (Serbia)

Shkodra (Albania)



Niksic (Montenegro)


Pristina (Kosovo)

Zrenjanin (Serbia)

Prizren (Kosovo)

Bitola (Macedonia FYR)

United States(40 days)

Ukraine(429 days)

OECD average(153 days)

High number of pre-construction procedures across SEE

17

12

13

10

10

9

15

15

15

11

11

11

11

11

12

11

11

9

10

10

10

7

0

3

2

3

3

5

0

0

0

1

1

1

1

1

0

0

0

1

0

0

0

1

3

3

3

3

3

3

3

3

3

3

3

3

3

3

3

3

3

3

3

3

3

3

4

6

5

5

5

4

2

2

2

5

5

5

5

4

3

3

3

4

3

3

3

2

Zagreb (Croatia)

Tirana (Albania)

Bitola (Macedonia, FYR)

Shkodra (Albania)

Vlora (Albania)


Niksic (Montenegro)



Belgrade (Serbia)

Krusevac (Serbia)

Vranje (Serbia)

Zrenjanin (Serbia)

Pristina (Kosovo)

Prizren (Kosovo)

Sibenik (Croatia)

Varazdin (Croatia)

Uzice (Serbia)




Osijek (Croatia)

Before Construction During Construction Utilities After Construction

Total

13

16

16

16

17

17

17

18

19

20

20

20

20

20

20

21

21

21

23

24

24

100days

307days

0

50

100

150

250

300

350

Mostar 8 procedures, 145 days

Sarajevo7 procedures, 331 days

Time to register property in Bosnia and Herzegovina (days)

Land registries- main bottleneck to registering property

Apply for registration at the land registry

Others

Days to enforce a contract

180

280

60

45

30

30

60

60

30

30

60

30

700

750

365

495

495

385

329

180

180

265

270

180

210

600

360

700

110

110

180

187

120

120

60

45

105

60

57

0 300 600 900 1200 1500



Sibenik (Croatia)

Vranje (Serbia)

Belgrade (Serbia)


SEE Average

Pristina (Kosovo)

Prizren (Kosovo)

Krusevac (Serbia)

Bitola (Macedonia FYR)


Zrenjanin (Serbia) Filing Period Judgement Period Enforcement Period

World’s bestHong Kong- 211 days

World’s slowestTimor Leste- 1800 days

SEE Average

Regional average

573 days to enforce a contract

13.8

21.122.924.224.725.7

30.3

35.135.138.4

41.1

47.547.5

0

15

30

45

60

Zagre

b (C

roat

ia)

Bitola

(Mac

edon

ia F

YR)

Sibenik

(Cro

atia

)

Varaz

din (C

roat

ia)

Osijek

(Cro

atia

)

Zrenja

nin

(Ser

bia)

SEE ave

rage

Shkod

ra (A

lbani

a)

Vlora

(Alba

nia)

Saraje

vo (B

iH)

Banja

Luk

a (B

iH)

Pristin

a (K

osov

o)

Prizre

n (K

osov

o)

Latin America(31%)

Uganda(45%)

Germany (12%)

Cost to enforce a contract (% of the claim)

Regional average

A hypothetical city “Zlatnic” would rank 9th out of 178 economies if regional best practices were adopted

Indicator Best performing cityGlobal rank

(178 economies)Best

practice

Days to open a business Shkodra/ Vlora, Albania 12 7 days

Cost to enforce a contract Zagreb, Croatia 17 13.8%

Days to build a warehouse Bitola, Macedonia FYR 19 94 days

Cost to register property Prizren, Montenegro 20 0.8%

Days to enforce a contract Zrenjanin, Serbia 22 300 days

Procedures to start a business Shkodra / Vlora, Albania 24 6

Cost to open a business Bitola, Macedonia FYR 24 3.9%

Days to register property Pljevlje, Montenegro 28 17 days

Procedures to build a warehouse Osijek, Croatia 29 13

Procedures to register property Zagreb, Croatia 42 5

Cost to build a warehouse Tirana, Albania 119 461%

Great initial impact: Political support for reform efforts has continued even after two rounds of local elections and one presidential election since first benchmark.

Doing Business in Mexico 2006, 2007 and 2008: sustained development results

75%

2006 - 2007 2007 - 2008

94%

12 states

31 states

Reformers Non-reformers

9 reformers

29 reformers

Priorities for Reform in South East Europe

• Business Registration• Eliminate minimum capital requirement • Allow business start-up online

• Property Registration • Introduce fixed fees• Make registries electronic

• Construction Licensing• Consolidate project clearances • Make licensing applications and processing electronic

• Contract Enforcement • Introduce/improve case management system• Improve enforcement

Business entry reforms = more businesses

Countries ranked by ease of doing business, quintiles

Business Density (registered firms per capita)

Business Entry (new firms in % of registered firms)

Source: Doing Business database

Easiest Most difficult Most difficultEasiest

…Which means more formal employment

Source: Doing Business database, WDI

Informal Sector (% of GDP)

Unemployment (% of labor force)

Easiest Most difficult Most difficultEasiest

Countries ranked by ease of doing business, quintiles

www.doingbusiness.org/SEE

World Bank Group supports reforms in areas covered by the Subnational Doing Business Project

S-N DB

Indicators

Albania Bosnia and

Herzegovina

Croatia FYR

Macedonia

Montenegro Serbia

Starting

Business● ● ● ● ● ●

Licensing ● ● ● ● ● ●

Registering

property

Contract

enforcement● ● ● ● ●

World Bank ● FIAS/IFC Advisory Services

Building on our sub-national competitiveness work

• Ongoing• Institutionalizing reform

• Streamlining procedures and regulatory reform process

• Building capacity of sustainable implementation within municipalities

• Network of policy makers• Building constituencies for reform• Facilitating peer-to-peer learning• Capacity building and introduction of good practice discussion• Linking with the networks outside the region

• Planned• Possible scale-up and roll-out

• Second round of municipalities• New countries as interests grows across the region

Thank you/ Hvala/ Faleminderit/ Blagodaram

Doing Business

http

://subnatio

nal.d

oin

gbusin

ess.o

rg

• Extra Slides.

Top 30 on the Ease of Doing Business — 2007

1. Singapore 16. Switzerland

2. New Zealand 17. Estonia

3. United States 18. Georgia

4. Hong Kong, China 19. Belgium

5. Denmark 20. Germany

6. United Kingdom 21. Netherlands

7. Canada 22. Latvia

8. Ireland 23. Saudi Arabia

9. Australia 24. Malaysia

10. Iceland 25. Austria

11. Norway 26. Lithuania

12. Japan 27. Mauritius

13. Finland 28. Puerto Rico

14. Sweden 29. Israel

15. Thailand 30. Korea

75. Macedonia, FYR

81. Montenegro

86. Serbia

97. Croatia

105. Bosnia and Herzegovina

136. Albania

Subnational Doing Business has projects all around the globe

2005200620072008

Countries: 32

Cities: 230

Cost to register property (% of property value)

0.8 0.9

2.8 2.9 2.9 2.9 2.93.2 3.3 3.3 3.4 3.4 3.5 3.5 3.5 3.5

5.0 5.0 5.0 5.0 5.05.5

0

1

2

3

4

5

6

7

8

9

10

Slovenia(2%)

Italy(0.6%)

Potential for improvement in ranking within the region

After

adopting

all best

practices

Global Rank: 9

South East Europe ranks:

75 - 136

Poland – 74

Russia – 106

Ukraine – 139

Canada – 7

Ireland – 8

Australia – 9

DB 2008 ranking

Doing Business subnational series

Doing Business

in south east europe 2008 pierre guislain director, investment climate department and general...

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