Azerbaijan improves position in WB’s Doing Business 2016

Baku, Azerbaijan, Oct. 28

By Ilaha Mammadli - Trend:

Azerbaijan has improved its position in the Doing Business-2016 annual ranking of the World Bank (WB) and the International Finance Corporation (IFC) by 17 points, said the report "Doing Business 2016: Measuring Regulatory Quality and Efficiency" published Oct.28.

A new method of calculation referred to as "the principle of distance to frontier score" (this measure shows how close each economy is to global best practices in business regulation) was used when compiling the rating, Baku office of the World Bank told Trend.

Taking into account the updating of indicators, Azerbaijan took the 63^rd place in 2015, as in 2014, said the report. According to the new methodology, last year's figure of Azerbaijan distance was 66.65 points, this year the figure is 67.8 points, the authors of the report said.

At the same time, Azerbaijan was among the ten countries with the best conditions to start a business. Azerbaijan took the seventh place with 97.75 points, whereas last year it took the 11^th place.

Rating of Azerbaijan was formed of the following indicators:

Dealing with Construction Permits - 114^th place (against 138^th last year)

Getting Electricity - 110^th place (against 104^th)

Registering Property - 22^nd (21^st)

Getting Credit - 109^th (105^th)

Protecting Minority Investors - 36^th (54^th)

Paying Taxes - 34^th (33^rd)

Trading Across Borders - 94^th (93^rd)

Enforcing Contracts - 40^th (40^th)

Resolving Insolvency - 84^th (85^th)

In the global ranking stakes, Singapore retains its top spot. Joining it on the list of the top 10 economies with the most business-friendly regulatory environments are New Zealand, in second place; Denmark (3); Republic of Korea (4); Hong Kong SAR, China (5); United Kingdom (6); United States (7); Sweden (8); Norway (9); and Finland (10).

Doing Business data for the past 12 years shows that in 2003, it took an average of 51 days worldwide to start a new business. This has now been more than halved to 20 days. In addition, the data shows encouraging signs of convergence toward best practices, as lower-income economies have shown more improvement than high-income economies over time. The case of Mozambique illustrates this trend. In 2003, it took an entrepreneur 168 days to start a business, but now it only takes 19 days.

The reforms implemented in Europe and Central Asia (including Azerbaijan) accounted for 25 percent of the 231 reforms implemented worldwide during the past year, according to the report. The region also boasted three 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 Cyprus, Kazakhstan, and Uzbekistan.

"It is commendable that almost every single economy in Europe and Central Asia implemented at least one reform in the last year to improve the business environment," said Rita Ramalho, Manager of the Doing Business project. "The political commitment and hard work involved in implementing these reforms has allowed the region's economies to break into top performers on most of the indicators measured by the report."

Azerbaijan held three reforms in 2015, just like in 2014, and was among 26 countries with the maximum amount of reorganizations.

Developing economies quickened the pace of their business reforms during the last 12 months to make it easier for local businesses to start and operate, said the World Bank Group's annual ease of doing business measurement.

Doing Business 2016: Measuring Regulatory Quality and Efficiency finds that 85 developing economies implemented 169 business reforms during the past year, compared with 154 reforms the previous year. High income economies carried out an additional 62 reforms, bringing the total for the past year to 231 reforms in 122 economies around the world.

The majority of the new reforms during the past year were designed to improve the efficiency of regulations, by reducing their cost and complexity, with the largest number of improvements made in the area of Starting a Business, which measures how long it takes to obtain a permit for starting a business and its associated processing costs.

The report "Doing Business 2016" is being compiled for already the 13^th time and covers 189 countries. It examines regulations norms that favor or impede the development of business during the whole cycle of their activities, including the creation of the enterprise, doing business, the implementation of foreign trade, payment of taxes, as well as the level of investor rights' protection.