Starting a business in Madagascar China Penelope J. Brook, Director, Indicators and Analysis Financial & Private Sector Development

Doing Business Indicators 2007 2008 2009 Starting a business Dealing with licenses Employing workers Registering property Getting credit Protecting investors Paying taxes Trading across borders Enforcing contracts Closing a business Add 3 countries Reformer’s Club: 11 case studies Research program on regulation and business opportunities for women Ongoing work on new indicators Shoes of an entrepreneur. Laws that discriminate against women Reforms that benefit women Case studies of successful women entrepreneurs

Focus on Steps, Time and Cost is Doing Business Basic Methodology Time (number of days) Cost (% of GNI per capita) Cost (right axis) Time (left axis) 5 10 15 20 25 30 0% 2% 4% 6% 8% 10% 12% 14% Authorize company name Notarize company deeds & register for tax Register public commercial register with IMSS with federal tax authorities Notice of opening of mercantile establishment at the SIEM File a notice with INEGI Starting a business in Mexico  8 procedures that take 27 days and 13.3% of income

Top 30 on the Ease of Doing Business — 2007 Singapore 16. Switzerland 2. New Zealand 17. Estonia 3. United States 18. Georgia 4. Hong Kong, China 19. Belgium 5. Denmark 20. Germany 6. United Kingdom 21. Netherlands 7. Canada 22. Latvia 8. Ireland 23. Saudi Arabia 9. Australia 24. Malaysia 10. Iceland 25. Austria 11. Norway 26. Lithuania 12. Japan 27. Mauritius 13. Finland 28. Puerto Rico 14. Sweden 29. Israel 15. Thailand 30. Korea

 Top Reformers in 2006-07 1. Egypt 2. Croatia 3. Ghana 4. Macedonia FYR 5. Georgia 6. Colombia 7. Saudi Arabia 8. Kenya 9. China 10. Bulgaria Starting a business  Dealing with licenses Employing workers Registering property Getting credit Protecting investors Paying taxes Trading across borders Enforcing contracts Closing a business

Singapore 1 China 83 Vietnam 91 Japan 12 Indonesia 123 Thailand 15 China and the Region Singapore 1 Hong Kong, China 4 Japan 12 Thailand 15 Malaysia 24 Korea 30 Brunei 78 China 83 Vietnam 91 Indonesia 123 Philippines 133 Cambodia 145 Lao PDR 164 Timor-Leste 168

A top 10 reformer globally for second year in a row in 2007 China Highlights A top 10 reformer globally for second year in a row in 2007 #83 in ease of doing business, up by 9 places Improved in 3 of the 10 indicators studied by Doing Business: Dealing with licenses Getting credit Closing a business

China’s Overall Ranking: #83 Topic China’s Rank Top ranked Starting a business 135 Australia Dealing with licenses 175 St. Vincent & the Grenadines Employing workers 86 United States Registering property 29 New Zealand Getting credit 84 United Kingdom Protecting investors 83 Paying taxes 168 Maldives Trading across borders 42 Singapore Enforcing contracts 20 Hong Kong, China Closing a business 57 Japan

More Reforms, Higher Equity Returns 90% 80% Egypt 70% Colombia 60% Brazil 50% Poland 40% India 30% China Sri Lanka 20% 10% Venezuela 0% -6 -4 -2 2 4 6 8 10 12 Number of reforms, 2003-06

Countries ranked by ease of doing business, quintiles Business Friendly Regulation Leads to More Registered Businesses and Start-ups Business Density (registered firms per capita) Business Entry (new firms in % of registered firms) Easiest Most difficult Easiest Most difficult Countries ranked by ease of doing business, quintiles Source: Doing Business database

…Which Means More Formal Employment Informal Sector (% of GDP) Unemployment (% of labor force) Easiest Most difficult Easiest Most difficult Countries ranked by ease of doing business, quintiles Source: Doing Business database, WDI

Why Expand Doing Business to the Sub-National Level? Extends Doing Business indicators beyond the most populous city Actively involves local governments in the reform process Diagnostic tool Reform instrument M&E instrument Creates baseline Allows locations to compete locally and globally Entry point in countries averse to international comparisons Puts regulatory reform on political agenda Comparisons within countries are strong drivers of reform Uncovers bottlenecks and local good practices Promotes peer to peer learning Measures progress over time Creates an incentive to maintain reform effort even when governments change

Subnational DB Uncovers Best Practices within a Country Countries/Regions Global ranking DB 2008 Hypothetical city ranking South East Europe 75-136 9 India 134* 79* Pakistan 76 52 OECS 27-85* 14* Colombia 66 35 México 43* 33* Egypt 126 106 Morocco 129 113 China 83 67 *2007 data

To learn more about Doing Business http://chinese.doingbusiness.org