Zim slips down World Bank business index

THE inclusive government yesterday received a vote of no confidence after the country slipped by one position to 157 in the World Bank Doing Business Report which measures government’s commitment to create an environment of doing business easily.

The 2011 report, which covers nine formal sector indicator sets in 183 economies, was compiled by the International Finance Corporation, a private sector arm of the World Bank.
The Doing Business Report covers the period up to June year-on-year.
The Bretton Woods institution ranked Zimbabwe ahead of Angola and strife-torn Democratic Republic of Congo in rankings portraying the country as one of the worst investment destinations in the world.
Singapore maintained pole position in the second year running in a survey that has been in place for five years. Mauritius was ranked the best performing country in the region after maintaining the position for two years.  Zambia on the other hand became the best performer in Sadc after climbing eight places up the ladder to settle at 76.
Enforcing contracts contributed to the country’s dismal performance as seen by a drop to 110 compared to 81 recorded last year.
This indicator which critics say reflects Zimbabwe’s appalling record in upholding property rights is determined by following the evolution of a payment dispute and tracking the time, cost, and number of procedures involved from the moment a plaintiff files the lawsuit until actual payment.
Similarly, a slump was recorded in an indicator that measures government commitment to protecting investors. Out of the nine indicators, the country, however, improved on dealing with construction permits after it went up the ladder to position 172 from 175.
Starting a business in the investment-starved nation continues to be a nightmare. The IFC ranked Zimbabwe 143, two points down from last year’s position.
It remains to be seen whether this ranking would ring hollow on government which has been lagging in setting up a one-stop investment centre to eliminate bureaucratic bottlenecks.
Government has twice this year delayed the restructuring of the Zimbabwe Investment Authority into an efficient investor-friendly authority.
There was no change on trading across borders and closing business which rated the country at 168 and 156 respectively.
The indicators, however, do not measure all aspects of the investment climate such as political and economic stability, corruption, level of labour skills, proximity to markets, and regulation specific to foreign investment or financial markets.
In September, visiting World Bank official David Bridgman advised government to overhaul investment regulations in a move expected to unlock investment inflows.
“Government should eliminate the waiting period in confirming business registration at the National Social Security Authority (NSSA) to improve conditions for starting a business,” Bridgman said.
Apart from NSSA, potential investors have to endure registration and assessment at local authorities, Registrar of Companies and the Environmental Management Agency.
“Rwanda and Mauritius show that there is no obstacle to African countries being counted among the best in the world. Other rapid reformers –– Burkina Faso, Liberia, and Kenya –– have reinforced lessons on how rapid reform can be achieved,” Bridgman said.

 

Bernard Mpofu