Pakistan was among the top 10 business climate enhancers in the world for its ratification of six regulatory reforms related to business regulation, according to the World Bank's Doing Business 2020 study.
A statement issued Thursday highlighted Pakistan's efforts to achieve improvements in the business climate in the country, which earned it a jump of 28 places to a global ranking of 108. The previous year, Pakistan had been at 136.
"This increase is significant and was possible thanks to the collective and coordinated actions of the Federal Government and the provincial governments of Sindh and Punjab over the past year," said Illango Patchamuthu, Country Director of the World Bank for Pakistan. “The accelerated reform agenda has many notable features to improve the quality of regulations, reduce time and streamline processes. This momentum must be maintained in the coming years for Pakistan to continue progressing. ”
The statement said the reforms that paved the way for Pakistan's new classification are also "significant."
"The country has facilitated the start of a business by expanding the functionalities of the online one-stop shop. This reduced the number of procedures needed to establish a business from 10 to five and improved the economy's score to start a business. In addition, in Lahore, the Department of Labor registration fee was abolished, "he said.
The World Bank statement also acknowledged that the process to acquire a building permit was facilitated by the authorities and faster in both Karachi and Lahore.
In Karachi, the process also became safer due to quality inspections of buildings that are carried out regularly.
Editorial: Commercial facility
"Pakistan also facilitated the tax payment process by introducing online payment modules for value-added taxes and corporate income taxes. The government also reduced the corporate income tax rate for fiscal year 2018 This reform reduced the number of payments from 47 to 34 and the total number of hours required to meet the tax requirements per year from 294 to 283, "according to the statement.
With regard to electricity subscriptions, the World Bank noted that the process had been made much easier.
Karachi and Lahore have "demanded service delivery deadlines and launched an online portal for new applications," in addition to making electricity charges more transparent.
Similarly, the property registration process also became more efficient "by facilitating the execution and registration of a deed in the Office of the Sub-Registrar."
"Lahore increased the transparency of the land administration system by publishing its list of tariffs online," the statement said.
Cross-border trade improvements were also recognized.
"Pakistan improved the integration of several agencies in the Web-based Customs electronic system (WEBOC) and ensured the coordination of joint physical inspections at the port," the World Bank said in its study.
In addition, there was also appreciation for Pakistan's protection of minority investors.
"Pakistan continues to perform better in the indicator of protecting minority investors, earning maximum points possible over the scope of the property and control index, which measures government safeguards that protect shareholders from undue control of the board. Globally , Pakistan is among the top 30 economies in this measure, "the statement said.
However, despite significant progress, there are certain areas in which work is necessary.
"For example, in fulfilling the contracts, the country is ranked 156. It takes 1,071 days to resolve a trade dispute in Pakistan, almost double the average among OCED's high-income economies," the Bank study found. World.
Gulf countries rise rankings, Latin America fades
The countries of the Gulf led by Saudi Arabia drastically improved their ranking in the World Bank's latest Doing Business report, while Latin American countries were greatly delayed in reforms and New Zealand ranked first for the fourth consecutive year.
The report found that the most improved countries during the previous year were Saudi Arabia, Jordan, Togo, Bahrain, Tajikistan, Pakistan, Kuwait, China, India and Nigeria.
Saudi Arabia rose 30 places to 62, while Jordan rose 29 to 75, driven by reforms aimed at building greater economic diversification, the World Bank said.
He said that Saudi Arabia's reforms included the establishment of a one-stop shop for business registration, the introduction of a guaranteed transaction law and insolvency law, improved protections for minority investors and measures to attract more women to the workforce.
"Something is clearly happening in the Gulf that has not happened before," said Simeon Djankov, senior director of research at the World Bank and founder of the Doing Business report. Reuters before a launch event in Riyadh attended by ministers.
"Everyone in this region discovered that it is better to diversify the economy in some direction and I think this is the reason why reforms are happening now." Two or three years ago, when countries started working on some of these reforms, oil prices were unstable, he added.
Saudi Arabia's Minister of Commerce and Investment, Majid al-Qasabi, said the increase in the ranking was "a good milestone." But this has to be sustainable. This is a journey (that) requires continuous efforts. "
The report coincides with the appearance scheduled for next week by World Bank President David Malpass at a Saudi investment conference, a year after his predecessor retired from the same event amid a worldwide protest over the murder of the journalist. Jamal Khashoggi at the consulate of Saudi Arabia in Istanbul.
US officials said after canceling last year, Treasury Secretary Steven Mnuchin and presidential adviser Jared Kushner would also attend the forum, which aims to show Saudi Arabia as a commercial destination.
"Eliminating the barriers faced by entrepreneurs generates better jobs, more tax revenues and higher incomes, all of which is necessary to reduce poverty and raise living standards," Malpass said in a statement.
Critics say the report is too heavy in favor of deregulation.
“This is a pure measure of deregulation. This index takes a fairly extreme position on market fundamentalism, "said Justin Sandefur, a member of the Washington-based Center for Global Development.
The top 10 rankings of the survey did not change greatly since last year, with New Zealand taking first place followed by Singapore, Hong Kong, Denmark, South Korea, the United States, Georgia, Great Britain, Norway and Sweden.
China rose 15 places to 31, a movement that Djankov attributes to internal reforms caused by trade tensions with Washington.
Latin American countries lagged behind, with Argentina dropping seven places to 126 and Mexico, the region's highest economy, dropping six places to 60. The World Bank said that for the second consecutive year, Mexico did not make significant improvements.
Chile fell three places to position 59. The South American commodity exporter was at the center of a controversy in January 2018 about changes in the methodologies of the study, which former World Bank chief economist Paul Romer said there could be been partial against the then socialist president, Michelle Bachelet.
Romer left the bank shortly after transmitting his views in a Wall Street Journal interview.
India improves in 14 places
The faster bankruptcy resolution and the issuance of building permits helped India jump 14 places.
"India launched four new trade reforms over the past year and won a place among the top ten breeders in the world for the third year in a row," the World Bank said in its "Doing Business 2020" report.
Eager to attract investment and accelerate economic growth, India's Prime Minister Narendra Modi aims to win a ranking among the top 50 in the World Bank's annual assessment of 190 countries.
Last year, the government of India also relaxed the rules for starting new businesses and for conducting international trade. And this year reduced the corporate tax rate to encourage investment.
However, the economy slowed down over the past year because weak private investments led to a year-on-year growth that fell to a minimum of six years from 5 percent in the quarter from April to June.
The latest report showed that India was still lagging behind in areas such as enforcing contracts where it was ranked 163 and registering properties where it was ranked 154.