Press Release -- Sub Saharan Africa

In Washington, D.C.:
Nadine Ghannam
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E-mail: nsghannam@ifc.org

Business Regulations Improved in Record Number of Economies in Sub-Saharan Africa

Washington D.C., October 20, 2011—A new report from IFC and the World Bank finds that a record number of economies in Sub-Saharan Africa improved business regulations for local entrepreneurs in the past year.

Released today, Doing Business 2012: Doing Business in a More Transparent World assesses regulations affecting domestic firms in 183 economies and ranks the economies in 10 areas of business regulation, such as starting a business, resolving insolvency, and trading across borders. This year, the rankings on ease of doing business have expanded to include indicators on getting electricity.

The pace of regulatory improvements has picked up across Sub-Saharan Africa. Six years ago, a third of Sub-Saharan African economies made improvements to the regulatory climate for domestic firms. Between June 2010 and May 2011, 36 of 46 governments in the region implemented reforms in at least one of the 10 areas measured by the report.

“Entrepreneurship is constrained when regulation is too complex or onerous,” said Augusto Lopez-Claros, Director, Global Indicators and Analysis, World Bank Group. “With their impressive improvements this year, the governments of Sub-Saharan Africa are improving prospects for local businesses.”

For the fourth year in a row, Mauritius was the easiest place in Sub-Saharan Africa for an entrepreneur to do business, with a global rank of 23. By implementing reforms in areas such as paying taxes, getting credit, starting a business, dealing with construction permits, registering property, and resolving insolvency, São Tomé and Príncipe, Cape Verde, Sierra Leone and Burundi are among the region’s most-improved economies for entrepreneurs.

“Post-conflict economies such as Burundi, Liberia, and Sierra Leone are among those that have implemented broad regulatory reforms,” said Sylvia Solf, lead author of the report. “They demonstrate that despite challenges, economies can move forward to encourage entrepreneurship.”

New data show that improving access to information on business regulations can aid entrepreneurs. In many Sub-Saharan African economies, getting essential information often requires meeting with an official, demonstrating that improving access to information remains one of the region’s areas for improvement.

Over the past six years, 43 economies in Sub-Saharan Africa have made their regulatory environment more business-friendly. Recently, steps have also been taken to improve business regulation through regional coordination to overhaul a body of harmonized commercial laws—a legal reform requiring consensus from the 16 member states of the Organization for the Harmonization of Business Law in Africa (OHADA).

About the Doing Business report series

Doing Business analyzes regulations that apply to an economy’s businesses during their life cycle, including start-up and operations, trading across borders, paying taxes, and resolving insolvency. The aggregate ease of doing business rankings are based on 10 indicators and cover 183 economies. Previous year’s rankings are back-calculated to account for the addition of new indicator(s), data corrections, and methodology changes in existing indicators so as to provide a meaningful comparison with the new rankings. Doing Business does not measure all aspects of the business environment that matter to firms and investors. For example, it does not measure security, macroeconomic stability, corruption, the level of skills, or the strength of financial systems. Its findings have stimulated policy debates in more than 80 economies and enabled a growing body of research on how firm-level regulation relates to economic outcomes across economies. For more information about the Doing Business report series, please visit www.doingbusiness.org. Join us on Facebook.

About the World Bank Group

The World Bank Group is one of the world’s largest sources of funding and knowledge for developing countries. It comprises five closely associated institutions: the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA), which together form the World Bank; the International Finance Corporation (IFC); the Multilateral Investment Guarantee Agency (MIGA); and the International Centre for Settlement of Investment Disputes (ICSID). Each institution plays a distinct role in the mission to fight poverty and improve living standards for people in the developing world. For more information, please visit www.worldbank.org, www.miga.org, and www.ifc.org.

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