Starting a business in Madagascar

ChinaPenelope J. Brook, Director, Indicators and AnalysisFinancial & Private Sector Development

Doing Business Indicators

2007 2008 2009• Starting a business

• Dealing with licenses

• Employing workers

• Registering property

• Getting credit

• Protecting investors

• Paying taxes

• Trading across borders

• Enforcing contracts

• Closing a business

Add 3 countries

• Reformer’s Club:

• 11 case studies

• Add 3 countries

• Research program on

regulation and

business opportunities

for women

• Ongoing work on new

indicators

Focus on Steps, Time and Cost isDoing Business Basic Methodology

Tim

e (n

um

be

r o

f d

ays

)

Co

st (

% o

f G

NI

pe

r ca

pit

a)

Cost

(right axis)

Time

(left axis)

0

5

10

15

20

25

30

0%

2%

4%

6%

8%

10%

12%

14%

Authorize company

name

Notarize company deeds & register for tax

Register public

commercial register

Register with IMSS

Register with federal

tax authorities

Notice of opening of mercantile

establishment

Register at the SIEM

File a notice with INEGI

Starting a business in Mexico 8 procedures that take 27 days and 13.3% of income

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

Top Reformers in 2006-07

1.Egypt

2.Croatia

3.Ghana

4.Macedoni

a FYR

5.Georgia

6.Colombia

7.Saudi Arabia

8.Kenya

9.China

10.Bulgaria

Starting a

business Dealing with

licenses Employing

workers

Registering

property Getting credit

Protecting

investors Paying taxes

Trading

across

borders

Enforcing

contracts Closing a

business

China 83Vietnam 91Indonesia 123Philippines 133Cambodia 145Lao PDR 164Timor-Leste 168

Singapore 1Hong Kong, China 4Japan 12Thailand 15Malaysia 24Korea 30Brunei 78

China and the Region

China Highlights

• A top 10 reformer globally for second year in a

row in 2007• #83 in ease of doing business, up by 9 places• Improved in 3 of the 10 indicators studied by

Doing Business: • Dealing with licenses• Getting credit• Closing a business

China’s Overall Ranking: #83

Topic China’s Rank Top ranked

Starting a business 135 Australia

Dealing with licenses 175 St. Vincent & the Grenadines

Employing workers 86 United States

Registering property 29 New Zealand

Getting credit 84 United Kingdom

Protecting investors 83 New Zealand

Paying taxes 168 Maldives

Trading across borders 42 Singapore

Enforcing contracts 20 Hong Kong, China

Closing a business 57 Japan

More Reforms, Higher Equity Returns

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

-6 -4 -2 0 2 4 6 8 10 12

Venezuela

Egypt

Colombia

Sri Lanka

India

Brazil

Poland

Number of reforms, 2003-06

China

Business Friendly Regulation Leads toMore Registered Businesses and Start-ups

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

Why Expand Doing Business to the Sub-National Level?

Diagnostic tool Reform

instrument M&E instrument

• Creates baseline

• Allows locations to compete locally and globally

• Entry point in countries averse to international comparisons

• Puts regulatory reform on political agenda

• Comparisons within countries are strong drivers of reform

• Uncovers bottlenecks and local good practices

• Promotes peer to peer learning

• Measures progress over time

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

•Extends Doing Business indicators beyond the most populous city

•Actively involves local governments in the reform process

Subnational DB Uncovers Best Practices within a Country

Countries/RegionsGlobal ranking DB 2008

Hypothetical city ranking

South East Europe 75-136 9

India 134* 79*

Pakistan 76 52

OECS 27-85* 14*

Colombia 66 35

México 43* 33*

Egypt 126 106

Morocco 129 113

China 83 67

*2007 data

To learn more about Doing Business http://chinese.doingbusiness.org