Manama: The Kingdom of Bahrain has improved its ranking in the World Bank Doing Business Report.
World Bank released its latest Doing Business 2015 report that measures the ease of doing business in 189 economies based on 11 business-related regulations, including business start-up, getting credit, getting electricity, and trading across borders.
According to KIPCO Asset Management Co (KAMCO) the report highlighted improving rankings for Bahrain for Registering Property and Getting Credit. The country has made registering property easier by reducing the registration fee. It has also improved access to credit information by approving the credit bureau’s collection of data on firms. The country also improved ranking for Trading Across Borders. On the other hand, the country declined in rankings for Getting Electricity.
Positive reforms in Saudi Arabia was minor and was reported merely on a single indicator i.e. Getting Electricity, whereas the country saw declining ranks on five of the remaining nine indicators. The steepest decline was reported for Starting a Business indicator followed by Trading Across Border indicator which was also highlighted in the previous year’s report on Doing Business. For Starting a Business, the country has a relatively greater number of procedures as compared to other economies in the MENA region. The decline in rank for the latter indicator was because Saudi Arabia made trading across borders more difficult by increasing the number of documents needed to export and import, as mentioned last year.
Positive reforms in the UAE were focused on three key indicators: Registering Property, Getting Credit and Protecting Minority Investors. Registering Property: According to the report, the UAE has made transferring property easier by introducing new service centers and a standard contract for property transactions.
Getting Credit: In the UAE reforms making it easier to get credit were undertaken at the national level. Emcredit, the Emirate’s recently established credit bureau, and the Dubai Electricity and Water Authority (DEWA) began exchanging credit information in October 2013. As a result, the credit bureau can now identify customers with unpaid DEWA accounts beyond 90 days and the utility has access to the bureau’s bounced check repository.
Protecting Minority Investors: The UAE strengthened minority investor protections by introducing additional approval requirements for related-party transactions, greater requirements for disclosure of such transactions to the stock exchange and a requirement that interested directors be held liable if a related-party transaction is unfair or constitutes a conflict of interest. The UAE also made it possible for shareholders to request the rescission of unfair related party transactions.
Oman ranked fifth in the GCC and sixth in the MENA region on the Doing Business rankings. According to the report, the Sultanate saw its ranking decline by six notches to 66. The country saw a decline in scores for Getting Electricity and Starting a Business due to higher minimum capital requirements for entrepreneurs. In terms of Getting Credit, the Sultanate lags in ranking on account of inadequate credit registry coverage.
Improvements in Qatar were primarily related to Trading Across Borders and minor change with respect to Registering Property. As highlighted in the Doing Business report for 2013, Qatar has reduced the time to export and import by introducing a new online portal allowing electronic submission of customs declarations for clearance at the Doha seaport. The steepest decline in rank was reported for Starting a Business, with 11 notches decline in rank primarily on account of minimum paid in capital requirement for new entrepreneurs calculated as a percentage of economy’s income per capita.
Kuwait remained at the bottom in terms of relative rankings in the GCC and at the 86th position as compared to the overall coverage. According to the report, Kuwait got a negative score for Starting a Business as it made starting a business more difficult by increasing the commercial license fee. The country also faltered in terms of the Getting Electricity indicator in relative terms as other countries improved their relative rankings on this indicator. On a positive note, Kuwait is one of the countries that have formed reform committees within governments and who frequently use the Doing Business indicators as one input to inform their programs for improving the business environment. Furthermore, Kuwait recorded 63.11 points near the highest performance level index, which was slightly higher than the 63.05 points scored in the previous report.
The rankings for the rest of the GCC and MENA economies declined during the same period, with the exception of Egypt that was able to increase its rank by one notch. Kuwait saw the steepest decline in its rank in the GCC region standing at the 86th position during the 2013/14 as compared to 79th position during the previous evaluation period. The decline came primarily on account of a drop in score for Starting a Business indicator. The country saw its rank decline on several other indicators.
The Middle-East’s largest economy, Saudi Arabia, also saw a relatively steep decline in its ranking which declined from 44 in the previous report to 49 in 2013/2014 due to a decline in score for Trading Across Borders. The only area of improvement for Saudi Arabia was related to getting electricity. Meanwhile, Egypt saw its ranking notch up by one rank for strengthening rules relating to protecting interests of minority investors as well as minor improvement in score for trading across borders.
Globally, more than 80% of the economies covered by Doing Business had an improvement in their distance to frontier score which implies that it is now easier to do business in most parts of the world. A snapshot of reforms in the GCC economies as highlighted in the Doing Business 2015 report are mentioned below in the latest report.