“East Africa Regulatory Reforms Improved Business Climate”


more about geneva; color: #222222;”>Released recently, Doing Business in the East African Community 2013 compares business regulations and identifies good practices across the EAC in 10 areas covered by the joint World Bank and IFC annual global Doing Business report.

Header advertisement

From June 2011 to June 2012, the five EAC economies implemented a combined nine regulatory reforms across eight areas measured by Doing Business.

The report finds that the EAC ranks on average 117th (among 185 economies) on the ease of doing business.

“But if all EAC countries adopted the best practices in the region across all areas of regulation covered, the EAC would rank 26th, equal to the United Arab Emirates,” the report noted, adding, “This is evidence that the ingredients of reform already reside in the EAC; what remains is for a stronger culture of peer learning to grow within the community.”

Burundi is among the global top 10 improvers for the second consecutive year, with four regulatory reforms—in starting a business, dealing with construction permits, registering property, and trading across borders.

Rwanda, the top performer in the EAC, stands out as having consistently improved since 2005.

“Drawing on the global Doing Business report, Doing Business in the East African Community 2013 provides policy makers with key measurements of business regulations in the EAC,” said David Bridgman, Manager, Investment Climate Africa, IFC/World Bank Group.

“The report’s findings can be used to identify areas to improve the business environment in the EAC along with enabling the expansion of the private sector, the main driver of growth and job creation.”

Over the past eight years, the five EAC economies implemented a total of 74 business regulatory reforms. The majority of the reforms focused on simplifying regulatory processes—such as registering property and starting a business.

The average time to register property fell from 140 days in 2005 to 56 in 2012. The introduction of new information and communication technology has been a common feature of reforms making it easier to start a business.

Both Kenya and Tanzania now offer online name search for companies, reducing time and cost. On average, the EAC countries reduced the time to start a business by 31 percent.

More and broader regulatory reforms, however, will be required for the EAC to significantly increase its share of trade and investment, including strengthening cooperation between business regulators across the five countries and adopting common and improved standards for business laws and regulation to be implemented at the country level.

This is the fourth report in this series analyzing business regulations in the EAC. The regional report draws on the global Doing Business project and its database as well as the findings of Doing Business 2013, the 10th in a series of annual reports investigating the regulations that enhance and constrain business activity globally.

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 protecting investors.

The aggregate ease of doing business rankings are based on 10 indicators and cover 185 economies. Doing Business does not measure all aspects of the business environment that matter to firms and investors.

For example, it does not measure the quality of fiscal management, other aspects of macroeconomic stability, the level of skills in the labor force, or the resilience of financial systems.

Its findings have stimulated policy debates worldwide and enabled a growing body of research on how firm-level regulation relates to economic outcomes across economies. This year’s report marks the 10th edition of the global Doing Business report series.


Header advertisement
To Top