Doing Business in Nigeria 2014

Transcription

1 Comparing Business Regulations for Domestic Firms in 35 States and Abuja, FCT Mierta Capaul & Madalina Papahagi Subnational Doing Business Development Economics September 29, 2014

2 What does Doing Business measure? Doing Business indicators: Focus on regulations relevant to the life cycle of a small to medium-sized domestic business. Are built on standardized case scenarios. Are measured for the most populous city in each country. Are focused on the formal sector. DO NOT measure all aspects of the business environment such as macroeconomic stability, corruption, level of labor skills, proximity to markets, or of regulation specific to foreign investment or financial markets. 1

3 Doing Business measures areas of regulation that are important throughout the life cycle of small and medium size firms 2

4 Pace of reforms remains strong in 2012/13: share of economies with at least one reform making it easier to do business 58% OECD high Income 73% Europe and Central Asia 40% Middle East and North Africa 60% Latin America & the Caribbean 53% 66% Sub-Saharan Africa 75% South Asia East Asia and Pacific Worldwide, 114 economies implemented 238 reforms in 2012/2013, 18% rise with respect to 2011/2012. While in 2005/2006 only 33 % of the economies in Sub-Saharan Africa implemented business regulation reforms, in 2012/ % of the economies did so. 3

5 What do Subnational reports add? Expand Doing Business indicators beyond the largest business city measured by the annual report Capture local differences in regulations or enforcement Provide information on good practices within the same country that can be easily replicated Provide a tool for locations to tell their story and to compete globally Combine Doing Business media appeal with active participation of subnational governments in the reform process 4

6 Subnational Doing Business studies capture local differences and large variations across locations The cost of dealing with construction permits varies widely across cities within the same country or region SEE Nigeria Philippines Colombia Italy Russia Indonesia Mexico Cost (% of income per capita) Source: Doing Business database Note: Subnational Doing Business studies measured 23 cities in Colombia (2013), 13 in Italy (2013), 13 in Kenya (2012), 20 in Indonesia (2013), 30 in Russia (2012), 32 in Mexico (2012), 25 in Philippines (2011), 22 in in South East Europe (Albania, Bosnia and Herzegovina, Croatia, Kosovo, FYR Macedonia, Montenegro, and Serbia- 2011) and 37 in Nigeria (2010) 5

7 Subnational Doing Business studies show potential of reforms across locations within the same country Dealing with construction permits in Russia: what if the best regional practices were adopted in Moscow? Improvement in Global DB Rank (1-183) 181st 103th Procedures th Time 423 days Global DB Data for Russia* Best practice in Russia 113th Cost ** 78th 183% days 46th 40% *Data published in Doing Business 2012, as measured for Moscow as of June 2012 ** % of income per capita 6

8 Subnational Doing Business studies motivate local governments to reform: the experience of Mexico Number of Doing Business reforms* Starting a business Dealing with construction permits Registering property 0 Enforcing contracts *Subnational locations (does not include the Federal District) 7

9 Demand for Subnational Doing Business in all regions and all income levels 355 cities and 55 economies More than one round of study in 26 economies 4 fragile state economies Regional studies: OHADA (16) + OECS (6) + SEE (8) Economies from all income levels BRICs 9 high-income economies 18 upper-middle income economies 18 lower-middle income economies 15 low-income economies 13 countries in Europe and Central Asia 16 countries In Latin America & Caribbean 6 countries in Sub- Saharan Africa 3 countries in Middle East & N. Africa 2 countries in South Asia 4 in East Asia and Pacific Economies with one subnational DB study Economies with more than one subnational DB study 8

10 Since 2008 Doing Business in Nigeria has been promoting improvement of regulations states + Abuja, FCT Baseline for 4 indicators 36 states + Abuja, FCT Updated 4 indicators Measured progress over 2 years in 11 locations 35 states + Abuja, FCT Updated 4 indicators Measured progress over 4 years in 36 locations Compares gender employment and other data among public agencies 1) Starting a business, 2) Dealing with construction permits 3) Registering property 4) Enforcing contracts 9

11 A state s regulatory environment may be more business friendly in some areas than in others 10

12 States that strive the most to maintain an active dialogue with their peers have a better business regulatory environment 11

13 Good business regulations and governance In countries where business regulation is efficient and information on documentation requirements and fee schedules is easily accessible, the costs to start a business are much lower. 12

14 Key findings 1. Twenty-two states have improved in at least 1 of the 4 areas measured. 2. While most reform efforts focused on reducing the complexity and cost of regulatory processes, several states also undertook judicial reforms to strengthen legal institutions. 3. Cross River, Ekiti, Niger, Ogun and Rivers improved the most across the areas measured, making the biggest strides towards the national frontier of good practices. 4. Different state regulations along with uneven implementation of federal legislation drive large variations across indicators. No single state ranks at the top on all indicators. 5. Federal leadership will be crucial to roll out reforms in federal agencies (such as CAC) and to ensure the effective implementation of legal changes. 13

15 Ogun, Niger, Cross River, Ekiti, and Rivers narrowed the gap with the regulatory frontier of good practices the most since

16 Six states significantly reduced the time to start a business 15

17 Ogun radically transformed the construction permitting process 16

18 Property registration fees are generally high, but vary greatly across Nigeria 17

19 Clearing court backlogs resulted in faster contract enforcements in Niger, Ekiti and Kaduna 18

20 The gender perspective: assessing practices at public registries across the country 108 Corporate Affairs Commission branches, land registries and state building authorities were surveyed across 35 states and Abuja: No legal or regulatory restrictions were found for Nigerian women to start or operate a business In more than 2/3 of the agencies surveyed, it is common for a female entrepreneur to send a male representative on her behalf Women are underrepresented among the employees of the public agencies surveyed: only in 1/3 of the agencies, women make up more than 35% of the workforce. 19

21 Adopting local good practices already existing in Nigeria would improve the business environment across the country 20

22 Thank you! For more information: 21