46707 intheArab World COMPARING 2009 REGULATION IN 20 ECONOMIES inthe Arab World 2009 COMPARING REGULATION IN 20 ECONOMIES A copublication of the World Bank and the International Finance Corporation © 2008 The International Bank for Reconstruction and Development / The World Bank 1818 H Street NW Washington, DC 20433 Telephone 202-473-1000 Internet www.worldbank.org E-mail feedback@worldbank.org All rights reserved. 1 2 3 4 08 07 06 05 A publication of the World Bank and the International Finance Corporation. This volume is a product of the staff of the World Bank Group. The findings, interpretations and conclusions expressed in this volume do not necessarily reflect the views of the Executive Directors of the World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. Rights and Permissions The material in this publication is copyrighted. 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Copies of Doing Business 2009, Doing Business 2008, Doing Business 2007: How to Reform, Doing Business in 2006: Creating Jobs, Doing Business in 2005: Removing Obstacles to Growth and Doing Business in 2004: Understanding Regulations may be purchased at www.doingbusiness.org. Contents Doing Business 2009 in the Arab World Regulations affecting 10 stages of the Overview 1 is a report drawing on the data of the life of a business are measured: starting Doing Business topics 9 global Doing Business project and da- a business, dealing with construction Starting a business 10 tabase, as well as the findings of Doing permits, employing workers, registering Dealing with construction permits 14 Business 2009, the sixth in a series of property, getting credit, protecting inves- annual reports published by the World tors, paying taxes, trading across bor- Employing workers 17 Bank and the International Finance Cor- ders, enforcing contracts and closing a Registering property 20 poration. Doing Business investigates the business. Data in Doing Business 2009 are Getting credit 23 regulations that enhance business activ- current as of June 1, 2008. The indicators Protecting investors 26 ity and those that constrain it. Doing are used to analyze economic outcomes Paying taxes 29 Business presents quantitative indicators and identify what reforms have worked, on business regulations and the pro- where and why. Other areas important to Trading across borders 32 tection of property rights that can be business--such as country's proximity Enforcing contracts 36 compared across 181 economies--from to large markets, quality of infrastruc- Closing a business 38 Afghanistan to Zimbabwe--and over ture services (other than services related Ease of doing business 41 time. This report focuses on 20 Arab to trading across borders), the security Case studies 43 economies: Algeria, Bahrain, Comoros, of property from theft and looting, the Djibouti, Egypt, Iraq, Jordan, Kuwait, transparency of government procure- Saudi Arabia 44 Lebanon, Mauritania, Morocco, Oman, ment, macroeconomic conditions or the Egypt 47 Qatar, Saudi Arabia, Sudan, Syria, Tu- underlying strength of institutions--are Jordan 50 nisia, United Arab Emirates, West Bank not directly studied by Doing Business. Doing Business indicators 55 and Gaza and Yemen. Country tables 58 This report was produced with the sup- port of the Arab Monetary Fund. Acknowledgments 79 Current features Downloads News on the Doing Business project Doing Business reports as well as subnational, http://www.doingbusiness.org country and regional reports and case studies Rankings http://www.doingbusiness.org/downloads How economies rank--from 1 to 181 Subnational projects http://www.doingbusiness.org/ Differences in business regulations at the economyrankings subnational level Reformers http://www.doingbusiness.org/subnational Short summaries of DB2009 reforms, lists Law library of reformers since DB2004 and a ranking Online collection of business laws and simulation tool regulations http://www.doingbusiness.org/reformers http://www.doingbusiness.org/lawlibrary Data time series Local partners Customized data sets since DB2004 More than 6,700 specialists in 181 economies http://www.doingbusiness.org/customquery who participate in Doing Business Methodology and research http://www.doingbusiness.org/LocalPartners The methodologies and research papers Reformers'Club underlying Doing Business Celebrating the top 10 Doing Business http://www.doingbusiness.org/ reformers MethodologySurveys http://www.reformersclub.org Blog Business Planet Online journal focusing on business Interactive map on the ease of doing business regulation reform http://www.doingbusiness.org/map http://blog.doingbusiness.org This report is based on Doing Business 2009. STARTING A BUSINESS 1 Overview FIGURE 1.1 Where do Arab economies rank on business-friendly regulations? DB2009 ranking on the ease of doing business (1­181) AVERAGE EACH LINE SHOWS THE RANK 1 RANK OF ONE ECONOMY IN THE REGION 181 OECD high income 27 Eastern Europe & Central Asia 76 East Asia & Paci c 81 Middle East & North Africa 90 Latin America & Caribbean 92 Arab World 100 South Asia 111 Sub-Saharan Africa 138 Source: Doing Business database. Economies in the Arab world are making In a region once known for prohibi- Easing Entry-- it easier for small- to medium-size enter- tive entry barriers, 2 Arab countries-- thE most popular rEform prises to do business. Tunisia and Yemen--eliminated the Since 2004 Doing Business has been minimum capital requirement for start- Making it easier to start a business con- tracking reforms aimed at simplifying ing a business, while Jordan reduced it by tinued to be the most popular Doing business regulations, strengthening prop- more than 96%. Business reform globally in 2007/08. erty rights, opening up access to credit Yemen also launched a one-stop Forty-nine economies, of which 10 are in and enforcing contracts by measuring shop to make it easier to start a business. the Arab World, simplified start-ups and their impact on 10 indicator sets. World- Syria was the second biggest reformer reduced costs. These are among the 115 wide, nearly 1,000 reforms with an impact in business start-up in the region. Syria economies--more than half the world's on these indicators have been captured. issued a new company law and com- total--that have reformed in this area Many governments have taken mercial code that took registration out over the past 5 years. The Arab econo- action to create a better regulatory of the court, introduced statutory time mies reforming in this area are Egypt, environment. Worldwide, 113 econo- limits and made using lawyers optional. Jordan, Lebanon, Mauritania, Oman, mies--including 20 in the Arab World-- But along with these reforms, Syria also Saudi Arabia, Syria, Tunisia, West Bank implemented 239 reforms making it made starting a business more difficult: and Gaza and Yemen. easier to do business between June 2007 a 33% increase in its minimum paid-in The second most popular reforms and June 2008--the most reforms re- capital requirement. were in the area of getting credit infor- corded in a single year since the Doing Lebanon and Oman improved the mation. Five Arab countries reformed Business project started. In the past year efficiency of their one-stop shops for in this area: Egypt, Morocco, Tunisia, reformers focused on easing business business start-up. The procedures that United Arab Emirates, West Dank and start-up, lightening tax burdens, simpli- used to take 46 days in Lebanon now gaze. The third most popular were re- fying import and export regulations and take 11. Egypt was a top global reformer forms to ease trading across borders. improving credit information systems. in 2007/08. Following on the previous Four Arab countries reformed in this Across regions, the Middle East and reforms, Egypt further reduced registra- area: Djibouti, Egypt, Morocco and Syria. North Africa (MENA) continued its up- tion costs and its minimum paid-in capi- In all 3 areas, administrative reforms in- ward trend with 27 reforms in two-thirds tal requirement. Saudi Arabia continued creased efficiency and transparency. of the region's economies, moving from to simplify commercial registrations and Reformsinotherareascanbeharder, the third fastest reforming region last reduced fees by 80%. Computerization particularly if they require legal changes year to the second fastest reforming re- of the registry in West Bank and Gaza or involve difficult political tradeoffs. gion this year. reduced registration time. In the Arab economies, there were no reforms in areas related to enforcing contracts, employing workers and get- ting credit (legal rights). 2 DoING BUSINESS IN THE ARAB WoRLD 2009 Who is rEforming in 2007/08? limits for various procedures, reducing the time to transfer a property in Cairo Mauritania simplified registration Doing business is becoming easier in from 193 to 72 days. The port of Alex- process requirements, saving time and most parts of the Arab World. This year, andria continued to upgrade its facilities costs while reducing the number of re- 13 Arab economies introduced 31 re- and speed up customs clearance, while quired procedures. In addition, Mauri- forms--29 of which made it easier to do banks delivered letters of credit faster this tania introduced its first building code. business while 2 made it harder: year, leading to a reduction of 1 day for This simplifies the requirements for export and 3 days for import. The Capital small construction projects and lays the Djibouti improved its port adminis- Market Authority increased protection groundwork for a one-stop shop. tration and eliminated some document for minority investors by introducing requirements for exporting and import- new listing rules for the Cairo and Alex- Morocco guaranteed the right of bor- ing, reducing the time to import from andria Stock Exchange, which require an rowers to inspect data concerning their 18 to 16 days, the documents to export independent body to assess transactions creditworthiness, helping to improve the from 8 to 5 and the documents to import between interested parties before they quality and accuracy of the data utilized from 6 to 5. are approved. Borrowers have the right by financial institutions in assessing the to inspect the data stored in the private risk profile of their clients. Also, effec- Egypt made starting a business easier credit bureau, thanks to new regulations tive 2008, the corporate income tax rate by cutting the paid-in minimum capital from the Central bank of Egypt. was reduced from 35% to 30%. Morocco requirement by 80%, abolishing bar asso- abolished its container ID card proce- ciation fees and automating tax registra- Jordan reduced the paid-in minimum dure thereby speeding up the import and tion. Egypt passed a new building code capital requirement for starting a busi- export process. with the aim of establishing a single win- ness by more than 96%. dow for processing construction related Oman's one-stop shop at the Ministry approvals and reducing procedures and Lebanon streamlined the business reg- of Commerce and Industry became fully time to deal with construction permits. istration processes, reducing the time to operational, cutting 3 procedures and 79 Egypt also simplified procedures for reg- start a business from 46 to 11 days and days to start a business in Oman. istering a property and introduced time eliminated one procedure. Table 1.1 Reforms in 2007/08 Dealing with Trading Starting a construction Employing Registering Getting Protecting Paying across Enforcing Closing a Economy business permits workers property credit investors taxes borders contracts business Algeria Bahrain Comoros Djibouti 4 Egypt 4 4 4 4 4 4 Iraq Jordan 4 Kuwait Lebanon 4 Mauritania 4 4 Morocco 4 4 4 Oman 4 Qatar Saudi Arabia 4 4 4 4 Sudan Syria 4 4 Tunisia 4 4 4 4 7 United Arab Emirates 4 West Bank and Gaza 4 7 4 Yemen 4 4Reformsmakingiteasiertodobusiness7 Reformsmakingitmoredifficulttodobusiness ovERvIEW 3 Table 1.2 Rankings on the ease of doing business AW 2009 AW 2009 AW 2009 RANK RANK ECONOMY RANK RANK ECONOMY RANK RANK ECONOMY 1 Singapore 62 Peru 122 India 2 New Zealand 63 Jamaica 123 Lesotho 3 United States 64 Samoa 124 Bhutan 4 Hong Kong, China 65 Italy 125 Brazil 5 Denmark 66 St. Vincent and the Grenadines 126 Micronesia 6 United Kingdom 67 St. Kitts and Nevis 127 Tanzania 7 Ireland 68 Kyrgyz Republic 12 128 Morocco 8 Canada 69 Maldives 129 Indonesia 9 Australia 70 Kazakhstan 130 Gambia, The 10 Norway 71 Macedonia, former Yugoslav 13 131 West Bank and Gaza 11 Iceland Republic of 14 132 Algeria 12 Japan 72 El Salvador 133 Honduras 13 Thailand 7 73 Tunisia 134 Malawi 14 Finland 74 Dominica 135 Cambodia 15 Georgia 75 Czech Republic 136 Ecuador 1 16 Saudi Arabia 76 Poland 15 137 Syria 17 Sweden 77 Pakistan 138 Uzbekistan 2 18 Bahrain* 78 Belize 139 Rwanda 19 Belgium 79 Kiribati 140 Philippines 20 Malaysia 80 Trinidad and Tobago 141 Mozambique 21 Switzerland 81 Panama 142 Iran 22 Estonia 82 Kenya 143 Cape Verde 23 Korea 83 China 144 Madagascar 24 Mauritius 84 Grenada 145 Ukraine 25 Germany 85 Belarus 146 Suriname 26 Netherlands 86 Albania 16 147 Sudan 27 Austria 87 Ghana 148 Burkina Faso 28 Lithuania 88 Brunei 149 Senegal 29 Latvia 89 Solomon Islands 150 Bolivia 30 Israel 90 Montenegro 151 Gabon 31 France 91 Palau 17 152 Iraq 32 South Africa 92 Vietnam 18 153 Djibouti 33 Azerbaijan 93 Marshall Islands 154 Haiti 34 St. Lucia 94 Serbia 19 155 Comoros 35 Puerto Rico 95 Papua New Guinea 156 Sierra Leone 36 Slovakia 96 Greece 157 Liberia 3 37 Qatar* 97 Dominican Republic 158 Zimbabwe 38 Botswana 8 98 Yemen 159 Tajikistan 39 Fiji 9 99 Lebanon 20 160 Mauritania 40 Chile 100 Zambia 161 Côte d'Ivoire 41 Hungary 10 101 Jordan 162 Afghanistan 42 Antigua and Barbuda 102 Sri Lanka 163 Togo 43 Tonga 103 Moldova 164 Cameroon 44 Armenia 104 Seychelles 165 Lao PDR 45 Bulgaria 105 Guyana 166 Mali 4 46 United Arab Emirates 106 Croatia 167 Equatorial Guinea 47 Romania 107 Nicaragua 168 Angola 48 Portugal 108 Swaziland 169 Benin 49 Spain 109 Uruguay 170 Timor-Leste 50 Luxembourg 110 Bangladesh 171 Guinea 51 Namibia 111 Uganda 172 Niger 5 52 Kuwait 112 Guatemala 173 Eritrea 53 Colombia 113 Argentina 174 Venezuela 54 Slovenia 11 114 Egypt 175 Chad 55 Bahamas, The 115 Paraguay 176 São Tomé and Principe 56 Mexico 116 Ethiopia 177 Burundi 6 57 Oman 117 Costa Rica 178 Congo, Rep. 58 Mongolia 118 Nigeria 179 Guinea-Bissau 59 Turkey 119 Bosnia and Herzegovina 180 Central African Republic 60 Vanuatu 120 Russian Federation 181 Congo, Dem. Rep. 61 Taiwan, China 121 Nepal * Bahrain and Qatar were first included in the Doing Business database in 2008. Note: The rankings for all economies are benchmarked to June 2008. Rankings on the ease of doing business are the average of the economy's rankings on the 10 topics covered in Doing Business 2009. Source: Doing Business database. FIGURE 1.4 239 reforms in 2007/08 made it easier to do business--26 made it more di cult 49 Albania Angola Azerbaijan Bangladesh Belarus Botswana Reforms Bulgaria making it Canada easier to Colombia do business Costa Rica Czech Republic Dominican Republic Egypt El Salvador Georgia Ghana 32 Greece Hungary Albania Italy Azerbaijan Jordan Belarus Kenya Cambodia Kyrgyz Republic Cameroon Lebanon Central African Republic Lesotho 24 Chad Liberia China Macedonia, former Azerbaijan Congo, Rep. Yugoslav Republic of Bangladesh Egypt Madagascar Belarus Equatorial Guinea Malaysia Bosnia and Herzegovina Finland Mauritania Burkina Faso Gabon Mauritius 18 Congo, Rep. Georgia Moldova Dominican Republic Guatemala Namibia Angola Egypt Indonesia New Zealand Armenia Georgia Kazakhstan Oman Belarus Hungary Liberia Panama Bosnia and Herzegovina Jamaica Macedonia, former Saudi Arabia Burkina Faso Kazakhstan Yugoslav Republic of Senegal Colombia Latvia Mauritius Sierra Leone Croatia Lithuania Moldova Singapore Egypt Macedonia, former Montenegro Slovakia Hong Kong, China Yugoslav Republic of Morocco Slovenia Jamaica Madagascar Sri Lanka South Africa Kyrgyz Republic 6 Mauritius Taiwan, China Syria Liberia Rwanda Tunisia Tonga Mauritania Argentina Saudi Arabia Ukraine Tunisia Portugal Azerbaijan Senegal United Arab Emirates Uruguay Rwanda Burkina Faso Serbia Uzbekistan West Bank and Gaza Sierra Leone Czech Republic Sierra Leone Vanuatu Yemen Singapore Mozambique Thailand Vietnam Zambia Tonga Slovenia Zambia West Bank and Gaza Starting Dealing with Employing Registering Getting a business construction permits workers property credit Indonesia Benin Cape Verde Reforms Switzerland Bulgaria China making it Fiji Fiji more di cult Montenegro The Gambia to do business Serbia Italy Tajikistan Kazakhstan Ukraine Korea West Bank and Gaza Sweden Zimbabwe United Kingdom Source: Doing Business database. ovERvIEW 5 36 Albania 34 Antigua and Barbuda Azerbaijan Belarus Belarus Benin Bosnia and Herzegovina Botswana Bulgaria Brazil Burkina Faso Colombia Canada Croatia China Djibouti Colombia Dominican Republic Côte d'Ivoire Ecuador Czech Republic Egypt Denmark El Salvador Dominican Republic Eritrea France France Georgia Haiti Germany Honduras Greece India Honduras Kenya Italy Korea 16 Macedonia, former Liberia Yugoslav Republic of Macedonia, former Bosnia and Herzegovina Madagascar Yugoslav Republic of 12 Bulgaria 12 Malaysia Madagascar Cambodia Mexico Mali Armenia Colombia Albania Mongolia Mongolia Austria Czech Republic Azerbaijan Morocco Morocco Azerbaijan Finland Botswana Mozambique Nigeria Belgium Germany Egypt New Zealand Palau Bhutan Greece Greece Samoa Philippines Bulgaria Hong Kong, China Kyrgyz Republic South Africa Rwanda China Latvia Saudi Arabia St. Vincent and the Grenadines Senegal Macedonia, former Mexico Slovenia Thailand Sierra Leone Yugoslav Republic of New Zealand Tajikistan Tunisia Syria Mozambique Poland Thailand Ukraine Thailand Portugal Portugal Tunisia Uruguay Ukraine Romania Saudi Arabia Turkey Zambia Uruguay Rwanda St. Vincent and the Grenadines Protecting Paying Trading Enforcing Closing investors taxes across borders contracts a business Botswana Equatorial Guinea Bolivia Venezuela Gabon Tunisia 6 DoING BUSINESS IN THE ARAB WoRLD 2009 can now consult their credit data in all fivE yEars of businEss Saudi Arabia reduced commercial reg- Central Bank offices. In addition, the rEforms istration fees and cut procedures for start- Ministry of Finance enabled the on- ing a business, reducing the start-up time line declaration of taxes accompanied This year, Doing Business also analyzed by 2 days. It also provided new provisions by physical payments at the tax bureaus. reform trends over the past 5 years. to increase the protection of minority Tunisia required freight arriving at the The analysis concludes that sustained shareholders by prohibiting interested port to be accompanied by a unit of the government commitment is the most im- parties from voting on the approval of customs authority and thereby increased portant predictor of regulatory reform. related-party transactions, while increas- the time to import by 1 day. For many economies, the reforms cap- ing sanctions against directors for mis- tured in Doing Business reflect a broader, conduct. For registering property, Saudi The United Arab Emirate's credit sustained commitment to improving Arabia adopted a comprehensive elec- bureau, Emcredit, started collecting in- their global competitiveness. Among the tronic system of registering title deeds. formation on the repayment pattern of systematic reformers, Egypt and Saudi As a result, parties can transfer a property individual borrowers as well as firms in Arabia stand out. Both countries have re- with 1 procedure in 1 day. February 2007. This has helpedsupervise formed in 5 or more of the areas covered banks and borrowers' debt levels while by Doing Business; Egypt implemented Syria introduced a new commercial fostering a culture of sharing credit in- 22 reforms over the past 5 years. code that simplified business start-up formation. Reform was motivated by various by abolishing the court and lawyers' in- reasons. Several economies were moti- volvement in the registration process. At The West Bank and Gaza's informa- vated by growing competitive pressure the same time, reforms in the tax direc- tion management system at its commer- related to joining common markets or torate further simplified tax registrations cial registry became fully operational, trade agreements, while some others saw for new business. The entry of private reducing the time to start a business by a need to facilitate local entrepreneur- banks into the Syrian market sped up 31 days. Also, the online system imple- ship (Egypt) or diversify their economy the issuing of Letters of Credit. This led mented by the Central Bank now allows (Saudi Arabia). Many reformers started to a reduction of 2 days in document a systematic upload of information on all by learning from others. Egypt looked to preparation time for both exports and loans extended by the financial institu- India for information technology solu- imports. tions in the member countries, which tions and Saudi Arabia looked to France increases the credit information coverage for modifying its commercial code. The Tunisia was a runner-up reformer in of borrowers. Rising prices for construc- most active reformers did not shy away the MENA region this year--after Egypt tion materials and price indexation in- from undertaking broad reform pro- and Saudi Arabia. Tunisia introduced the creased the cost of dealing with building grams. Egypt has implemented one-stop Law on Economic Initiative in December permits substantially. shops for import and export and busi- 2007 which abolished the paid-in mini- ness start-up. At the same time, it intro- mum capital requirement for limited Yemen launched a new one-stop shop duced sweeping tax reforms, improved liability companies. The law also allows making it possible to complete business its credit information systems and modi- minority investors to ask a judge to start-up at a single location and made it fied the listing rules of the Cairo Stock rescind prejudicial related-party transac- easier to obtain a license from the mu- Exchange. tions. The Central Bank of Tunisia now nicipality and to register with the cham- Over the past 5 years, the most collects and distributes more detailed ber of commerce and tax office. It also popular area of reform in the Arab World information from banks, including posi- abolished the seal and paid-in minimum has been in business start-ups, with 10 tive information (like loan amounts) and capital requirements, reducing substan- reforming economies. Getting credit (in- negative information (like arrears and tially the number of procedures and time formation) was the second most popular defaults). Also, individuals and firms to register a business. area of reform, followed by improvement in trade across borders. Some reforms took place in the following areas: Pro- tecting investors, dealing with licenses, registry property, paying taxes and clos- ing a business. There was only one re- form noted in employing workers and no reforms in getting credit (legal rights) or in enforcing contracts. ovERvIEW 7 ArAb economies WHo reformed consistently in tHe pAst 5 yeArs rEgulatory rEforms: What Mauritania reformed 3 years in a row. arE thE bEnEfits? Egypt reformed 4 years in a row. It It reformed in 4 areas: starting a busi- reformed in 6 areas: starting a busi- ness, registering property, enforcing con- Of Egypt's estimated 25 million urban ness, registering property, dealing with tracts and dealing with licenses. properties, only 7% were formally regis- licenses, getting credit information, trad- tered in 2005. Six months after reforming ing across borders, paying taxes and West Bank and Gaza reformed 2 its property registry, title registrations protecting investors. years in a row. It reformed 3 areas: start- increased and related revenue rose by ing a business, getting credit and paying 39%. In Oman, following its one-stop Saudi Arabia reformed 4 years in a taxes. shop implementation, the number of row. It reformed in 6 areas: starting a commercial registrations increased by business, registering property, getting Algeria reformed 2 years in a row. It approximately 93% in 1 year, from 733 credit, trading across borders, protecting reformed in 3 areas: trading across bor- to 1,306 per month. In Saudi Arabia, an investors and closing a business. ders, paying taxes and getting credit. 81% increase in new company registra- tions followed its reduction in minimum Tunisia reformed 4 years in a row. It Jordan reformed 3 years in a row. It capital requirements. reformed in 6 areas: starting a business, reformed in 2 areas: starting a business Initial results like these show that registering property, getting credit, pro- and trading across borders. reforms lead to change on the ground. tecting investors, paying taxes and trad- Further confirming this are the find- ing across borders. Kuwait reformed 2 years in a row. It ings of an increasing number of studies reformed in 3 areas: registering property, using the Doing Business data to analyze Morocco reformed 3 years in row. It dealing with licenses and getting credit. the effect of regulatory burdens on such reformed in 6 areas: starting a business, outcomes as informality, job creation, paying taxes, registering property, deal- Djibouti reformed 3 years in a row. It productivity, economic growth and ing with licenses, getting credit and trad- reformed in 3 areas: employing workers poverty reduction. Research generally ing across borders. (making it more difficult), registering finds that countries with burdensome property and trading across borders. regulation have larger informal sectors, Syria reformed 3 years in a row. It re- higher unemployment rates and slower formed in 3 areas: starting a business, Yemenreformedtwicein2areas:starting economic growth. Recent research also trading across borders and paying taxes. a business and paying taxes and United gives some insights into the impact of Arab Emirates reformed twice in 2 reforms around the globe. One study areas: trading across borders and getting reports some of the payoffs of reforms in credit. Lebanon and Sudan each re- Mexico where the number of registered formed once. Comoros did not reform. businesses rose by nearly 6%, employ- ment increased by 2.6% and prices fell by 1%, thanks to competition from new entrants. Another study finds that in- creasing the flexibility of labor regula- tions in India reduced job informality in the retail sector by a third. 9 Doing Business topics 10 Starting a FIGURE 2.1 business Rankings on starting a business are based on 4 subindicators As % of income per Preregistration, capita, no bribes included registration and postregistration 25% 25% Time Cost 25% 25% Procedures Paid-in minimum Procedure is capital completed when nal document is received Funds deposited in a bank or with a notary before registration Table 2.2 Note: See Data notes for details. Entrepreneurs with an idea for a new in. It is assumed that all information is business must first face the hurdles of set- readily available to the entrepreneur, that Who regulates business start-up the least--and who the most? ting it up--procedures and cost required there has been no prior contact with of- Procedures (number) to incorporate and register the new firm ficials and that all entities involved in the before they can legally operate. Econo- process function without corruption. Fewest Most mies differ greatly in how they regulate To make the data comparable across Lebanon 5 Djibouti 11 the entry of new businesses. In some the economies, detailed assumptions about Egypt 6 Iraq 11 process is straightforward and affordable. the business are used. Among these are: Morocco 6 West Bank 11 and Gaza In others the procedures are so burden- the business is a limited liability company Qatar 6 Bahrain 7 Kuwait 13 some that entrepreneurs may have to conducting general commercial activities Algeria 14 bribe officials to speed the process or may in the largest business city; it is 100% do- Time (days) decide to run their business informally. mestically owned, with a start-up capital The data on starting a business are of 10 times income per capita, a turnover Fastest Slowest based on a survey and research inves- of at least 100 times income per capita Qatar 6 Kuwait 35 tigating the procedures that a standard and between 10 and 50 employees; and it Egypt 7 Djibouti 37 small to medium-size company needs does not qualify for any special benefits, Bahrain 9 Sudan 39 Lebanon 11 West Bank 49 to complete to start operations legally. nor does it own real estate. Procedures Tunisia 11 and Gaza These include obtaining all necessary are recorded only where interaction is Iraq 77 permits and licenses and completing all required with an external party. It is as- Cost (% of income per capita) required inscriptions, verifications and sumed that the founders complete all pro- notifications. The time and cost required cedures themselves unless professional Least Most to complete each procedure under nor- services (such as by a notary or lawyer) Bahrain 0.6 Lebanon 87.5 mal circumstances are calculated, as well are required by law. Voluntary procedures Kuwait 1.3 Yemen 93.0 Oman 3.6 Iraq 150.7 as the minimum capital that must be paid are not counted, nor are industry-specific Tunisia 7.9 Comoros 188.6 Table 2.1 requirements and utility hook-ups. Law- Qatar 9.1 Djibouti 200.2 Where is it easy to start a business--and ful shortcuts are counted. where not? Cumbersome entry procedures are Paid-in minimum capital (% of income per capita) Easiest Least Most GLOBAL Most difficult GLOBAL associated with more corruption, par- (AW RANK 1­5) RANK (AW RANK 16­20) RANK ticularly in developing economies. Each Saudi Arabia 0.0 United Arab 311.9 Saudi Arabia 28 Mauritania 143 procedure is a potential opportunity for Sudan 0.0 Emirates Tunisia 37 Comoros 160 bribery. Analysis shows that burdensome Tunisia 0.0 Mauritania 422.6 Egypt 41 West Bank 166 Oman 461.2 entry regulations do not increase the Yemen 0.0 Bahrain 49 and Gaza Egypt 2.0 Djibouti 514.0 Yemen 50 Djibouti 173 quality of products, make work safer or Syria 4,353.8 Iraq 175 reduce pollution. Instead, they constrain Source: Doing Business database. Note: Rankings are the average of the economy rankings on the private investment; push more people procedures, time, cost and paid-in minimum capital for starting a business. into the informal economy; increase con- Source: Doing Business database. sumer prices and fuel corruption. DoING BUSINESS ToPICS 11 FIGURE 2.2 FIGURE 3.2 Which arab EconomiEs FIGURE 4.2 Arab economies rankings on Lebanon streamlined the business reg- Arab economies rankings on the ease rEformEd in thE past 5 yEars? Arab economies rankings on the ease of starting a business istration processes, reducing the time to of dealing with construction permits the ease of employing workers Global ranking (1­181) start a business from 46 to 11 days and Global ranking (1­181) Most reforms in 2007/08 were a continu- Global ranking (1­181) NEW eliminating 1 procedure. ST. VINCENT & ationUNITEDprevious reforms as follows: of ZEALAND EASIEST (1) THE GRENADINES EASIEST (1) STATES EASIEST (1) Saudi Arabia Mauritania simplified registration Bahrain Egypt Oman 20 Tunisia Qatar Bahrain -- 20 Egypt process requirements, saving time and Yemen In 202006, Egypt introduced computer- Kuwait costs while reducing the number of re- United Arab Emirates ized models for company contracts and Saudi Arabia 40 -- -- Bahrain -- Yemen quired procedures. 40 Saudi Arabia implemented a single access point and 40 United Arab Emirates Qatar Comoros approvals within 24 hours. It reorganized Jordan 60 -- -- Morocco Oman's one-stop shopJordan 60 at the Ministry its60business authority by:Lebanon -- Oman Kuwait 80 of Commerce and Industry became fully · Moving its CompaniesIraq Department, Lebanon operational, cutting 3 procedures and 79 80 Morocco General Authority forYemen 80 Investment and Sudan Djibouti 100 -- -- days to start a business in Oman. Free Zones (GAFI) andQatar Egypt bureaus repre- -- United Arab Emirates Tunisia Syria 100 Iraq 100 senting various governmental bodies West Bank and Gaza 120 -- Saudi Arabia cut procedures for busi- -- Jordan Algeria into the same buildingTunisia -- Kuwait ness start-up and reduced commercial 120 Lebanon ·120Delegating company registration to Algeria 140 -- Algeria registration fees, reducing the time to Syria GAFI Syria Mauritania start a business by 2 days. 140 Oman ·140Introducing the electronic registration Mauritania 160 -- -- Comoros Sudan -- of documents wherebyDjibouti all formalities West Bank and Gaza Syria introduced a new commercial Mauritania are reviewed and completed online Sudan 181 Djibouti 160 West Bank and Gaza 160 Comoros Iraq code that simplified business start-up by181abolishing the courtEgypt lawyers' in- · Facilitating the filing of applications Morocco and 181 with the chamber of commerce and volvement in the registration process, the submission of contracts for cer- FIGURE 5.2 Which arab EconomiEs while reforms at the tax directorate fur- FIGURE 6.2 FIGURE 7.2 tification with the lawyers syndicate Arab economies rankings on rEformEd in 2007/08? ther simplified tax registration for new Arab economies rankings on Arab economies rankings on and notary the ease of registering property business. the ease of getting credit ·protectinginvestors Automating the publication of regis- Starting a business was the most popular Global ranking (1­181) Global ranking (1­181) Global ranking (1­181) tration documents and then mailing areaSAUDI reform in the Arab world this for Tunisia introduced the Law on Eco- them to the applicant with all fees due NEW year.ARABIAa region once known for prohibi- In EASIEST (1) nomic Initiative in December 2007 MALAYSIA EASIEST (1) atZEALANDtime.EASIEST one (1) tive entry barriers, 2 countries--Tunisia Saudi Arabia which abolished the paid-in minimum Saudi Arabia As a result of these changes, time and Kuwait and Yemen--eliminated the minimum 20 United Arab Emirates capital requirement forUnited 20 limited liability Arab Emirates costs were reduced substantially. 20 Saudi Arabia paid-in capital requirement for starting Bahrain companies. Bahrain In 2007, Egypt continued its reforms West Bank and Gaza a business, while JordanOman Egypt Bahrain 40 reduced it sub- Sudan 40 Kuwait and40 further simplified the publication stantially. Yemen's move is one of the boldest reforms this yearIraq its minimum The West Bank and Gaza's informa- Lebanon requirement by makingAlgeriaEgypt it sufficient to 60 Yemen as tion management system at its commer- 60 Tunisia publish an extract of company's constitu- 60 Lebanon capital requirement wasQatar among the high- cial registry became fully operational, Jordan tion in GAFI's CompanyOman Gazette, instead est80in the world. DetailsTunisia of reforms in the reducing the time to start a business by 80 Oman of in the official gazette. Qatarresult, costs 80 As a region include: Mauritania 31 days. Algeria were further reduced. Iraq Syria Morocco 100 100 100 In 2008, Egypt reduced the mini- Jordan Egypt made starting a business easier West Bank and Gaza Yemen launched a newQatar mum capital requirement for limited Syria Sudan one-stop shop by reducing the paid-inKuwait 50,000 to 1,000 Arab Emirates tal by 80%, abolishingEgypt association 120 minimum capi- making it possible to complete business 120 Mauritania liability companies fromUnited 120 Comoros Comoros bar start-up at a single location and made Comoros Egyptian pounds. In addition, it further Yemen fees and automating theLebanon 140 tax registration it140easier to obtain a license from the Iraq simplified registration byMauritania it pos- 140 making process. Jordan municipality and to register with the West Bank and Gaza sible for entrepreneurs, Tunisiaregistered, once Morocco chamber of commerceDjiboutitax office. and to160file all documentation at a one-stop Sudan Jordan reduced the minimum paid-in 160 Djibouti It160also abolished the seal and paid-in Yemen shop--including tax registration (for Morocco minimum capital for starting a business Algeria minimum capital requirements reducing Syria both income and sales taxes) and cham- Djibouti by more than 96%. 181 substantially the number of procedures 181 ber of commerce registration. The entre- 181 and time to register a business. preneur pays all fees at the bank coun- FIGURE 8.2 FIGURE 9.2 ter, notarizes the contract at the notary FIGURE 10.2 Arab economies rankings on Arab economies rankings on counter and returns the following day to Arab economies rankings on the ease of paying taxes the ease of trading across borders the ease of enforcing contracts Global ranking (1­181) Global ranking (1­181) Global ranking (1­181) HONG KONG 12 DoING BUSINESS IN THE ARAB WoRLD 2009 pick up the final registration documents. In addition, the publication can be done Oman Syria immediately at the registry for a much The first phase of Oman's one-stop shop Syria's business start-up reforms have not lower fee. went live in May 2006 with 39 electronic followed a straight path. In 2006, Syria services for business registrations. The reduced its stamp duty from 1.5% to Jordan on-line one-stop shop became more fully 0.5% of capital. In 2007, it made business In 2004 Jordan started reforming in this operational towards the end of 2007. registrations more expensive by requir- area. In 2007, Jordan started operat- It automated business procedures, in- ing Limited Liability Companies (LLCs) ing its one-stop shop. Entrepreneurs can cluding commercial registrations and to publish their memorandum of asso- complete the following formalities in one applications for industrial and mineral ciation in the official gazette. In 2008, it building (albeit at different counters): licenses. It also used technology (e-mail passed a new law and commercial code, · Company registration and short message service) to upgrade opening the door to electronic process- · Tax registration (including obtaining the communication channels available ing. Syria also tried to harmonize its laws a tax number for VAT and income to entrepreneurs and investors. This one- with laws around the world. Further- tax) stop shop currently coordinates six min- more, Syria's 2008 reforms included de- · Chamber of commerce and/or cham- istries, nine regional offices and is acces- tailed explanations of legal forms while ber of industry registration sible by more than 100 individual users abolishing of the concept of a "closed · Municipality of Amman. from Oman's Ministry of Commerce and company" in order to encourage forma- Note that the municipality's counter only Industry. Soon the ministry plans to tion of LLCs. allows the renewal of licenses. The initial launch an Internet version of the system As a result, the following aspects license still has to be obtained at the mu- for investors to access anywhere. of business registration were also re- nicipality itself. In early July 2008, Jordan formed: continued reforming by amending its Saudi Arabia · Court involvement in the registration Companies Law and reducing the mini- In 2006, Saudi Arabia simplified pro- process was abolished mum capital by more than 96%, from cesses at its Ministry of Commerce. As · Decisions regarding companies' mem- 30,000 to 1,000 Jordanian dinars. part of this reform, the Saudi Arabian orandum of association were given a General Investment Agency (SAGIA) fi- statutory time limit of 2 weeks Lebanon nalized agreements with 17 government · Lawyers' involvement in the drafting In 2008, Lebanon continued to stream- agencies to remove impediments and in- of the memorandum of association line its business registration process--a troduce incentives for businesses. SAGIA was abolished and replaced with a process that started back in March 2006. also launched its "10/10" project which standard version As a result, visits to government offices aims to make Saudi Arabia one of the · Publication of the entire memoran- are no longer needed. Instead, one or two top 10 countries in the world by 2010, as dum of association was no longer trips to any branch of its postal service ranked in Doing Business. necessary; companies could simply (LibanPost) is all that's required. Once In 2007, Saudi Arabia eliminated publish a copy of their registration the documents are submitted along with the paid-in minimum capital require- certificate. the required fees to LibanPost, the result- ment that used to be 1057% income At the same time, a new directorate of ing required documents are received by per capita (and one of the highest in the taxes with reduced tax registration pro- mail within 5 to 7 business days. region). In addition, it simplified busi- cessing times helped further improve ness start-up procedures; procedures at Syria's business environment. Mauritania its Ministry of Commerce were sped up In 2007, Mauritania reduced the registra- and registration with the Chamber of Tunisia tion tax for new companies from 0.5% commerce was automated. In 2005, Tunisia reduced the minimum to 0.25% start-up capital. In May 2008, In 2008, Saudi Arabia continued capital for a limited liability company Mauritania passed a new decree that to streamline business registrations. It by 90%, from 10,000 to 1,000 Tunisian only exporting companies can apply for eliminated the requirement to publish the dinars. In order to encourage entrepre- the incentives provided in its investment summary Articles of Association in the neurs with limited funds to incorporate code. local newspaper and reduced the com- and create jobs. In 2008, it eliminated mercial registration fees with its Ministry the minimum capital requirement alto- Morocco of Commerce by 80%. It also moved its gether. In2004Moroccostartedreforminginthis registration procedures online. area. In 2006, Morocco cut the minimum paid-in capital requirement by 90%. DoING BUSINESS ToPICS 13 global rEform trEnds to determine what is appropriate for the West Bank and Gaza business based on its type and capital It takes less time to register a company creAting A one-stop sHop structure. Many Arab economies have in the West Bank and Gaza, thanks to the Five Arab economies have created or reduced or abolished their minimum full implementation of a new informa- improved one-stop shops in the past 5 capital requirement in the past 5 years, tion management information system, years. One-stop shops can be a quick including Egypt, Saudi Arabia, Jordan which unifies the registries across the way to build momentum for reform. Mo- and Yemen. This group has seen some of West Bank and Gaza economy. The sys- rocco created its in less than 6 months. the biggest spikes in new company regis- tem enables online registrations, helps And introducing a one-stop shop has had trations. Tunisia reduced its requirement train staff and sets up a single portal promising results. In Oman, business and new registrations increased by 30% for online procedures and information registrations increased from an average between 2002 and 2006. That encour- services. At the same time, tax adminis- 733 a month in 2006 to 1,306 a month aged the country to abolish it altogether tration reforms have reduced the time it in 2007. However, creating a one-stop in 2007/08. takes to register to pay taxes. shop is no magic bullet. Entrepreneurs may still deal with formalities outside using tecHnology Yemen the shop. In Guatemala, for example, a Making registration electronic is among In 2004 Yemen started reforming in this one-stop shop organized commercial, the most effective ways to speed company area. In 2008, Yemen embarked on a tax and social security registration in 2 formation worldwide. Seven of the econ- process to reform its commercial regis- to 3 days--on paper, at least. But before omies with the fastest business start-up tration process. It started by rationalizing the registrar can finalize the registration, offer electronic registration--Australia, and simplifying business registration, a notice must be published for 8 days Canada, Denmark, Estonia, New Zea- establishing a one-stop shop. The result during which third parties can raise ob- land, Portugal and Singapore. More than was a dramatic reduction the number of jections. In practice, despite Guatemala's 20 economies have introduced electronic procedures and time required to com- one-stop shop, 11 procedures and 26 registration in the past 5 years. Custom- plete them. Online procedures include days are still required for new businesses. ers are not the only ones saving on time registration applications, company- Around the world, reformers can run the and cost. When Belgium implemented name reservations, memorandum and risk of creating "one-more-stop shops" or its paperless registration and filing sys- articles of association, ministerial decree "mailboxes" that merely receive applica- tem, it reduced annual administrative licenses, publication announcement fol- tions and forward them to ministries for costs by 1.7 billion. Electronic registra- low ups and Register Card applications approval. tion is possible in more than 80% of rich for its Ministry of Industry and Trade. economies but only about 30% of de- Moreover, obtaining a license from a mu- AbolisHing tHe minimum pAid-in veloping ones. That is not surprising, of nicipality and registering with a chamber cApitAl requirement course, given the differences in internet of commerce and tax office have all be- Globally, 69 economies allow entrepre- access and costs. come more efficient. Costs were further neurs to start a company without put- reduced by abolishing the need to use a ting up a fixed amount of capital before company seal. registration. They allow entrepreneurs 14 Dealing with FIGURE 3.1 construction Rankings on dealing with construction permits are based on 3 subindicators permits Days to build As % of income per capita, a warehouse no bribes included in main city 33.3% 33.3% Time Cost 33.3% Procedures Procedure is completed when nal document is received; construction permits, inspections and utility connections included Once entrepreneurs have registered a The indicators on dealing with con- ·Note: Will be used for general storage, such See Data notes for details. business, what regulations do they face struction permits record all procedures as of books or stationery. The ware- in operating it? To measure such regu- officially required for an entrepreneur in house will not be used for any goods lation, Doing Business focuses on the the construction industry to build a ware- requiring special conditions, such as construction sector. Construction com- house. These include submitting project food, chemicals or pharmaceuticals. panies are under constant pressure: from documents (building plans, site maps) · Will be connected to electricity, water, government to comply with inspections to the authorities, obtaining all neces- sewerage (sewage system, septic tank and with licensing and safety regulations sary licenses and permits, completing all or their equivalent) and one land and from customers to be quick and required notifications and receiving all phone line. The connection to each cost-effective. These conflicting pres- necessary inspections. They also include utility network will be 32 feet, 10 sures point to the tradeoff in building procedures for obtaining utility con- inches (10 meters) long. regulation; the tradeoff between protect- nections, such as electricity, telephone, Table 3.2 ing people (construction workers, ten- water and sewerage. The time and cost to Who regulates construction permits the ants, passersby) and keeping the cost of complete each procedure under normal least--and who the most? building affordable. circumstances are calculated. All official Procedures (number) In many economies, especially poor fees associated with legally completing Fewest Most ones, complying with building regula- the procedures are included. Time is re- tions is so costly in time and money that corded in calendar days. The survey as- Bahrain 13 Algeria 22 Yemen 13 Kuwait 25 many builders opt out. Builders may pay sumes that the entrepreneur is aware of Djibouti 14 Mauritania 25 bribes to pass inspections or simply build all existing regulations and does not use Iraq 14 Syria 26 illegally, leading to hazardous construc- an intermediary to complete the proce- Oman 16 Egypt 28 tion. In other economies compliance is dures unless required to do so by law. Time (days) simple, straightforward and inexpensive, To make the data comparable across Fastest Slowest yielding better results. economies, several assumptions about Bahrain 56 Iraq 215 Table 3.1 the business and its operations are used. Qatar 76 Algeria 240 Where is dealing with construction The warehouse to be built: permits easy--and where not? Tunisia 84 Oman 242 · Is a new construction (there was no Kuwait 104 Egypt 249 Easiest GLOBAL Most difficult GLOBAL previous construction on the land). Yemen 107 Sudan 271 (AW RANK 1­5) RANK (AW RANK 16­20) RANK · Has complete architectural and tech- Cost (% of income per capita) Bahrain 14 Oman 133 nical plans prepared by a licensed Qatar 27 Sudan 135 architect Least Most Yemen 33 Mauritania 142 · Will be connected to electricity, water, Qatar 0.8 Oman 721.4 United Arab 41 West Bank 149 United Arab 1.5 Iraq 915.0 Emirates and Gaza sewerage (sewage system, septic tank Emirates Djibouti 982.8 Saudi Arabia 50 Egypt 165 or their equivalent) and one land Algeria 46.8 Tunisia 1,017.8 Bahrain 57.2 Note: Rankings are the average of the economy rankings on the phone line. The connection to each West Bank 1,399.9 procedures, time and cost to comply with formalities to build a Saudi Arabia 74.7 and Gaza warehouse. utility network will be 32 feet, 10 Source: Doing Business database. inches (10 meters) long. Source: Doing Business database. DoING BUSINESS ToPICS 15 · Will be used for general storage, such employees and implementing the au- as of books or stationery. The ware- Mauritania introduced its first build- tomated system, the fees for obtaining house will not be used for any goods ing code. The code simplifies the require- a building permit nearly doubled the requiring special conditions, such as ments for small construction projects and time to obtain other services such as fire food, chemicals or pharmaceuticals. lays the groundwork for a one-stop shop. inspection increased. · Will take 30 weeks to construct (ex- cluding all delays due to administrative Which arab EconomiEs Mauritania and regulatory requirements). rEformEd in thE past 5 yEars? In 2008, a draft construction code ("Code Where the regulatory burden is large, de l'Urbanisme") was put forward, but entrepreneurs may tend to move their While Egypt and Mauritania were has yet to be implemented. The aim is to activity into the informal economy. There the only reformers in 2007/08, looking streamline processes for obtaining build- they operate with less concern for safety, back 5 years, Morocco and Kuwait also ing permits by clarifying statutory time leaving everyone worse off. reformed limits and establishing a single window for the processing of building permits. Which arab EconomiEs Egypt Applicants are to submit all their docu- rEformEd in 2007/08? In 2007, Egypt reformed the notarization ments at one central location and pay and registration processes at the real a fixed fee depending on the type of EgyptandMauritaniareformedtheir estate registry and introduced a flat fee construction requested. Representatives construction permit procedures. instead of a percentage to register a prop- from the municipality and appropriate erty or building. Previously, registering ministries are to be represented in the Egypt issued a new construction law a newly built building cost 4% of the single window. Applications will be re- with the goal of reducing the time to building value. Moreover, documenta- viewed for processing on the spot and obtain a building permit by establishing tion process was streamlined and instead applicants will be issued a date when a single window and enforcing a 30-day of requiring many copies, single copies of they may expect a decision. Applicants statutory time limit. The new code also the required documents were housed in will no longer require a pre-approval introduces a single certificate for obtain- a central file. clearance or "visa" from the National ing all utility connections. Before, each In 2008, Egypt issued a new con- Laboratory (Laboratoire Nationale) or utility connection required 3 separate struction law that aims to simplify li- Agency of Civil Protection (Agence de letters from the municipality. censing procedures by establishing a Protection Civile). FIGURE 3.2 single window for all pre-permit approv- FIGURE 4.2 on Arab economies rankings on the ease als. In addition, the law aims to reduce Arab economies rankings on Morocco ness of dealing with construction permits the total time to obtain a building permit the ease of employing workers In 2007, a one-stop shop was estab- Global ranking (1­181) though the establishment of this single Global ranking (1­181) lished in Casablanca where documents ST. VINCENT & window and better enforcement of exist- UNITED are electronically filed and issuance dates THE GRENADINES EASIEST (1) ing statutory time limits. Moreover, the STATES EASIEST (1) assigned (within 15 days). However, an rabia Bahrain new construction law streamlines utility Oman inter-agency commission must meet to 20 Qatar connection requests. Previously, newly 20 Bahrain approve the dossiers. The main advan- Yemen built buildings requiredKuwait tage of the one-stop shop is that possible Saudi Arabia separate letters United Arab Emirates 40 Saudi Arabia from the municipality to obtain utility 40 United Arab Emirates delays are much more predictable. The Comoros connections. Jordan one-stop shop helps intra-agency com- o 60 Jordan 60 Lebanon munication and helps ensure that the Kuwait Kuwait Iraq application dossier is not lost. n 80 Morocco In802007, Kuwait implemented a utility Yemen Djibouti reform by introducing aQatar automated new West Bank and Gaza Arab Emirates Tunisia system connecting all government agen- Egypt 100 In 2008, West Bank and Gaza had a Iraq 100 West Bank and Gaza Algeria cies responsible for issuing technical ap- Tunisia negative reform as a result of increased 120 Lebanon provals for the installation of utilities. As 120 Algeria construction fees. These were instituted Syria a result, the time to obtain a connection Syria in response to a shortage of building ania 140 Oman to140utilities (phone, sewage and electric- Mauritania materials and price indexation. The cost os Sudan ity) has decreased significantly. However, Djibouti increase affected the cost to obtain a ank and Gaza Mauritania as160a result of increasingSudan number of the ti 160 West Bank and Gaza Comoros Egypt Morocco 181 181 FIGURE 6.2 FIGURE 7.2 on Arab economies rankings on Arab economies rankings on 16 DoING BUSINESS IN THE ARAB WoRLD 2009 survey map, test soil, hire independent setting time limits rAtionAlizing inspections engineers to review building plans and The second most popular reform feature The third most popular reform feature approve them for submission, and re- has been to introduce statutory time has been to shift from random inspec- ceive final inspection for building and limits or silence-is-consent rules. Many tions toward a more risk-based approach, connection. economies write time limits into the law with inspections only at critical stages of in the hope of ending administrative de- construction. Building authorities have global rEforms trEnds lays. For example, Algeria put a 2-month traditionally relied on random inspec- time limit on issuing building permits tions to ensure compliance. Today only streAmlining project cleArAnces in 2006. But obtaining a building permit 41 economies--most in Africa, Latin The most popular reform feature globally still takes an average 150 days because of America and the Caribbean and the has been to streamline project clear- lack of administrative resources. Builders Middle East and North Africa--still use ances. Because building approvals re- wait, out of fear that their buildings will them. Building authorities have learned quire the technical oversight of multiple be demolished if they proceed without that random inspections strain their lim- agencies, an obvious choice has been to a permit. In Colombia a law introduced ited resources and are an inefficient way set up a one-stop shop. But this is no easy a silence-is-consent rule in 1997. Ten to ensure building safety. Eleven of the fix. One-stop shops are designed to inte- years later implementing regulation and top 15 economies on the ease of deal- grate services through a single point of a far-reaching public awareness cam- ing with construction permits have gone contact between building authorities and paign finally made it possible for builders beyond risk-based inspections. Instead, entrepreneurs. Their success depends on to take control of the process. "Now we they allow certified professionals or inde- coordination between these authorities can begin construction after 45 working pendent agencies to perform inspections and on sound overarching legislation. days without any fear. As long as every during construction. Building authori- Take the experience of Bangladesh. requirement is complied with, we know ties usually inspect buildings only after In August 2007 Dhaka's municipal build- the law protects us," says one Colombian they are complete. Singapore, one of the ing authority introduced a one-stop shop architect. top performers, delegates control and for building permits. Almost a year later supervision of the entire construction builders still had to visit each agency process to licensed engineers and archi- responsible for approvals, mainly be- tects. In Japan more flexible licensing cause of inconsistent fire safety regula- regulations for private inspection com- tions. By law, only buildings with more panies have increased their numbers and than 10 floors should require fire safety made contracting with them faster and clearance. The fire department insists cheaper for builders. Most EU economies that the cutoff should be 6 floors, as in have shifted at least part of inspections the old regulations. Builders can spend to the private domain. Their experience 6 months shuttling between agencies, shows that private inspections work best trying to make sense of the inconsistent when supported by strong professional rules. associations with well-regulated accredi- tation mechanisms. A mature insurance industry also helps. 17 Employing FIGURE 3.1 workers Rankings on employing workers are based on 4 subindicators Fixed-term contracts, Nonstandard work schedules, minimum wage paid vacation days regulations 25% 25% Di culty Rigidity of hiring of hours index index 25% 25% Di culty Firing of ring cost index Mandatory legal As weeks of salary; requirements for dismissals includes notice period for economic reasons and severance payments Economies worldwide have established a and night work, requirements relating hiring, working hours and dismissal in a Note: See Data notes for details. system of laws and institutions intended to working time and the workweek and manner consistent with the conventions to protect workers and guarantee a mini- mandated days of annual leave with pay. of the International Labour Organization mum standard of living for its popula- The difficulty of firing index covers work- (ILO). An economy can have the most tion. This system generally encompasses ers' legal protections against dismissal, flexible labor regulations as measured by four bodies of law: employment, indus- including the grounds permitted for Doing Business while ratifying and com- trial relations, social security and oc- dismissal and procedures for dismissal plying with all conventions directly rel- cupational health and safety laws. Doing (individual and collective): notification evant to the factors measured by Doing Business examines government regula- and approval requirements, retraining Business and with the ILO core labor tion in the area of employment. or reassignment obligations and priority standards. No economy can achieve a Two measures are presented: a ri- rules for dismissals and reemployment. better score by failing to comply with gidity of employment index and a re- The redundancy cost indicator measures these conventions. dundancy cost measure. The rigidity of the cost of advance notice requirements, Governments all over the world employment index is the average of three severance payments and penalties due face the challenge of finding the right subindices: difficulty of hiring, rigidity of when terminating a redundant worker, balance between worker protection and hours and difficulty of firing. Each index expressed in weeks of salary. takes values between 0 and 100, with To make the data comparable across Table 4.2 Who makes employing workers easy-- higher values indicating more rigid regu- economies, a range of assumptions about and who does not? lation. The difficulty of hiring index mea- the worker and the company are used. Rigidity of employment index (0­100) sures the flexibility of contracts and the The company is assumed to be a Least Most ratio of the minimum wage to the value limited liability manufacturing corpo- added per worker. The rigidity of hours ration that operates in the economy's Kuwait 13 Djibouti 46 index covers restrictions on weekend most populous city, is 100% domesti- Saudi Arabia 13 Comoros 46 United Arab 13 Algeria 48 cally owned and has 201 employees. The Emirates Tunisia 49 Table 4.1 company is also assumed to be subject Bahrain 23 Morocco 63 Where is it easy to employ workers-- Oman 24 and where not? to collective bargaining agreements in economies where such agreements cover Firing cost (weeks of salary) Easiest GLOBAL Most difficult GLOBAL (AW RANK 1­5) RANK (AW RANK 16­20) RANK more than half the manufacturing sec- Least Most tor and apply even to firms not party to Oman 24 Mauritania 123 Iraq 0 Morocco 85 them. Bahrain 26 Djibouti 137 Oman 4 West Bank 91 and Gaza Kuwait 43 Sudan 144 Employment regulations are needed Bahrain 4 Comoros 100 Saudi Arabia 45 Comoros 162 to allow efficient contracting between Jordan 4 Sudan 118 United Arab 47 Morocco 168 employers and workers and to protect Yemen 17 Emirates workers from discriminatory or unfair Egypt 132 Note: Rankings are the average of the economy rankings on the treatment by employers. In its indicators Note: The rigidity of employment index is the average of the difficulty of hiring, rigidity of hours, difficulty of firing and firing difficulty of hiring index, rigidity of hours index and difficulty of cost indices. on employing workers, Doing Business firing index. Source: Doing Business database. measures flexibility in the regulation of Source: Doing Business database. 18 DoING BUSINESS IN THE ARAB WoRLD 2009 labor market flexibility. But in develop- Which arab EconomiEs all reforming more than once. ing countries especially, regulators often rEformEd in thE past 5 yEars? In Africa, Uganda (in 2006), Mo- err to one extreme, pushing employers zambique (in 2007) and Burkina Faso (in and workers into the informal sector. Djibouti 2008) enacted new labor laws, introduc- Analysis across economies shows that In 2006, Djibouti issued a new labor ing worker protections while increas- while employment regulation generally code, which altered the law regarding ing the flexibility of labor regulations. increases the tenure and wages of incum- fixed-term contracts making it less flex- Namibia (in 2004) eased restrictions on bent workers, overly rigid regulations ible. The previous law established that working hours. Yet among regions, Af- may have undesirable side effects. These fixed-term contracts were to be used rica continues to have the most rigid include less job creation, smaller com- for seasonal, temporary and occasional labor regulations. Dismissal costs for pany size, less investment in research and workers. However, it did not limit them a worker with 20 years of employment development, longer spells of unemploy- to only those types of workers. While amount to more than 3 years of salary ment and thus the obsolescence of skills, seasonal and temporary work contracts in Sierra Leone and more than 8 years all of which may reduce productivity were restricted to defined tasks with a in Zimbabwe. Africa is also home to growth. When economies err on the side maximum 6 month time span, fixed- the countries with the largest numbers of excessive rigidity, it is to the detriment term contracts in general were not sub- of mandatory paid annual leave days: of businesses and workers alike. ject to the defined task restriction and Eritrea with 34, Ethiopia with 33 and While limited reforms were made in were allowed for up to 2 years with the Cameroon with 32. Djibouti 2 years ago, no Arab economy possibility of a renewal for a maximum Three reformers stand out in East- reformed employment practices as mea- cumulative term of 4 years. The 2006 ern Europe and Central Asia. Slovakia sured by Doing Business last year. labor code limited the maximum term (in 2004) and Azerbaijan (in 2008) in- to 12 months only renewable once and troduced flexibility in the use of fixed- Which arab EconomiEs restricts the applicability of fixed term term contracts, in work schedules and rEformEd in 2007/08? contracts to the following set of pre- in redundancy requirements. Georgia defined job types: made big changes in those areas in 2005 No Arab economies reformed their em- · Seasonal and temporary workers and 2006 and also introduced changes in ployment practices. · Workers engaged for a specific task notice periods and severance payments. lasting not longer than 6 months Reform was widespread: 8 of the 10 FIGURE 4.2 ease Arab economies rankings on · Occasional workers countries in the region that have joined its the ease of employing workers · Workers hired by the hour or by the the European Union have reformed their Global ranking (1­181) day labor laws. Several, including Lithuania · Workers hired for the duration of a and Romania, did so to harmonize their UNITED STATES EASIEST (1) given project laws with EU legislation. Oman · Workers replacing permanent em- In South Asia, 2 economies have re- ployees on medical, maternity, or formed. Bhutan went far, implementing 20 Bahrain Kuwait training leave its first labor code in 2007. The new labor irates Saudi Arabia · Workers recruited in response to a code established protective measures for 40 United Arab Emirates temporary increase in the volume of workers without imposing heavy burdens Jordan work. on employers. The protections created 60 Lebanon Iraq incentives for workers to join the private global rEform trEnds sector--and employers now have a larger 80 Yemen Qatar pool of candidates to choose from. The Egypt moving toWArd more flexible better working conditions have led to 100 West Bank and Gaza regulAtions higher productivity. Tunisia Governments in Eastern Europe and In Latin America, Colombia and 120 Algeria Central Asia have been the most active Argentina made labor regulations more Syria reformers in the past 5 years, introducing flexible. Both made redundancy dismiss- 140 Mauritania Djibouti 19 reforms increasing the flexibility of als easier--Colombia in 2004 and Ar- Sudan labor regulations as measured by Doing gentina in 2005. Argentina also reduced Gaza 160 Comoros Business. Organization for Economic dismissal costs in 2007. In East Asia Morocco Co-operation and Development (OECD) and Pacific, Vietnam eased restrictions 181 high-income economies follow with 16, on fixed-term contracts, while Taiwan with Australia, Germany and Switzerland FIGURE 7.2 Arab economies rankings on protecting investors DoING BUSINESS ToPICS 19 (China) eased restrictions on working not let workers go for economic reasons hours. Except for Israel, no economies in without their consent. Under these cir- the Middle East and North Africa made cumstances employers might think twice labor regulations more flexible. before hiring a new worker. High dismissal costs can deter em- increAsing flexibility in setting ployers from creating jobs in the formal Hours And using contrActs sector. That argues for reducing dismissal Over the past 5 years 36 reforms have burdens. But excessive flexibility leads to been aimed at increasing flexibility in another problem: concern among exist- working hours and the use of fixed- ing employees about losing their jobs term contracts. Five reforms have made and being left without a safety net. One scheduling working hours more difficult. solution is to offer unemployment insur- Nine have restricted the use of fixed- ance rather than severance pay. In Aus- term contracts. tria employers contribute to a fund from Most of the reforms aimed at in- which they may withdraw if a worker is creasing flexibility in working hours took made redundant after 3 years of employ- place in Eastern Europe and Central ment. In St. Kitts and Nevis severance Asia. These reforms, concentrated in payments are made from a government- 2004 and 2005, allowed more flexible ar- administered fund that employers pay rangements for overtime and permitted into overtime. In Italy employers deposit businesses to shift working hours from a portion of each employee's salary into the low to the high season. a designated fund over the course of the employment relationship. In Korea reducing dismissAl costs employers adopting the new defined con- Outside the Arab world, 10 economies tribution plan will contribute 1 month's granted businesses more flexibility in salary annually to each employee's pri- dismissals during economic downturns. vate pension account. But 15 economies made such dismissals costlier or more difficult. In Bolivia and Venezuela, for example, an employer can- 20 Registering FIGURE 5.1 property Rankings on registering property are based on 3 subindicators Days to transfer property As % of property value, between 2 companies no bribes included in main city 33.3% 33.3% Time Cost 33.3% Procedures Steps for encumbrance checking, deed and title transfer until property can be sold again or used as collateral Formal property titles help promote the name. The property of land and building efits all entrepreneurs, especially women, Note: See Data notes for details. transfer of land, encourage investment will be transferred in its entirety. The the young and the poor. The rich have and give entrepreneurs access to formal transaction is considered complete when few problems protecting their property credit markets. But a large share of prop- the buyer can use the property as collat- rights. They can afford to invest in secu- erty in developing economies is not for- eral for a bank loan. rity systems and other measures to de- mally registered. Informal titles cannot Local property lawyers and officials fend their property. But small entrepre- be used as security in obtaining loans, in property registries provide informa- neurs cannot. Reform can change this. which limits financing opportunities for tion on required procedures as well Globally, twenty-four economies made it businesses. Many governments have rec- as the time and cost to complete each easier to register property in 2007/08. ognized this and started extensive prop- one. For most economies the data are erty titling programs. But bringing assets based on responses from both. Based Table 5.1 into the formal sector is only part of the on the responses, three indicators are Who regulates property registration the least--and who the most? story. The more difficult and costly it is constructed: to formally transfer property; the greater · Number of procedures to register Procedures (number) the chances that formalized titles will property. Fewest Most quickly become informal again. Elimi- · Time to register property (in calendar Bahrain 2 Kuwait 8 nating unnecessary obstacles to register- days). Oman 2 Lebanon 8 ing and transferring property is therefore · Official costs to register property (as a Saudi Arabia 2 Morocco 8 important for economic development. percentage of the property value). United Arab 3 Qatar 10 Emirates Doing Business records the full se- Many titling programs in Africa were Algeria 14 Mauritania 4 quence of procedures necessary for a futile because people bought and sold business (buyer) to purchase a property property informally, neglecting to update Time (days) from another business (seller) and to the title records in the property registry. Fastest Slowest transfer the property title to the buyer's Why? Doing Business shows that com- Saudi Arabia 2 Mauritania 49 pleting a simple formal property transfer United Arab 6 Algeria 51 Table 5.1 Emirates Kuwait 55 Where is registering property easy--and in the largest business city of an African Iraq 8 where not? economy cost on average 10% of the West Bank 63 Sudan 9 and Gaza Easiest value of the property and takes on aver- GLOBAL Most difficult GLOBAL Oman 16 Egypt 72 (AW RANK 1­5) RANK (AW RANK 16­20) RANK age 90 days. Worse, the property regis- Cost (% of property value) Saudi Arabia 1 Lebanon 102 tries are so poorly organized that they United Arab 11 Jordan 115 provide little security of ownership. Least Most Emirates Morocco 117 Efficient property registration re- Saudi Arabia 0.0 Algeria 7.5 Bahrain 18 Djibouti 134 Qatar 0.3 Jordan 10.0 Oman 19 duces transaction costs and helps to for- Algeria 162 Kuwait 0.5 Djibouti 13.2 Sudan 35 malize property titles. Simple procedures to register property are also associated Bahrain 0.9 Comoros 20.8 Note: Rankings are the average of the economy rankings on the Egypt 0.9 Syria 28.0 procedures, time and cost to register property. with greater perceived security of prop- Source: Doing Business database. erty rights and less corruption. That ben- Source: Doing Business database. FIGURE 2.2 FIGURE 3.2 FIGURE 4.2 Arab economies rankings on Arab economies rankings on the ease Arab economies rankings on the ease of starting a business of dealing with construction permits the ease of employing workers DoING BUSINESS ToPICS 21 Global ranking (1­181) Global ranking (1­181) Global ranking (1­181) The most popular reform: lowering Which arab EconomiEs theZEALANDof registration by reducing the cost NEW EASIEST (1) rEformEd inEASIEST past 5 yEars? ST. VINCENT & THE GRENADINES thE (1) MauritaniaEASIEST UNITED STATES (1) property transfer tax, registration fees or In 2006, a new law reduced registration Oman stamp duty. Saudi Arabia While Egypt and Saudi Bahrain were the Qatar Arabia costs as a whole. Specifically, the cost to 20 Tunisia Bahrain -- 20 20 Egypt only 2 reformers in 2007/08, Djibouti, Yemen register a sale agreementKuwaitcourt went in Which arab EconomiEs United Arab Emirates 40-- from no cost to 2% ofSaudi Arabia the underlying rEformEd in 2007/08? -- Bahrain Kuwait, Mauritania and Tunisia reformed -- Yemen in 40 previous years. Saudi Arabia property value (paid to the state), while 40 United Arab Emirates Qatar Comoros 60-- -- cost to transfer propertyJordanthe registry at Egypt and Saudi Arabia reformed Morocco Djibouti 60 Jordan (paid to the property registry, or, Service 60 Lebanon . -- Oman Kuwait Iraq 80 Lebanon In 2007, Djibouti improved the efficiency des Domaines) was lowered from 4% of Egypt simplified administrative proce- 80 Morocco the80underlying propertyYemen plus a flat Qatar value dures and introduced time limits. That 100-- Sudan at its property registry Service des Do- Djibouti maines by making it easier to work with Tunisia fee of MRO 100,000 to Egypt1.2% of the just cut the time to register property by 4 -- -- United Arab Emirates Syria notaries on transferringIraqproperty. This 100 underlying property value. 100 West Bank and Gaza months, from 193 days Jordan 120-- -- to 72. has resulted in a dramatic reduction in Algeria Tunisia -- Kuwait the time necessary to transfer property. 120 Lebanon Morocco 120 Algeria Saudi Arabia introduced a compre- 140-- Algeria Syria In 2006, the transfer tax was reduced Syria hensive electronic system to register title Oman 140 160-- Mauritania Egypt 140 deeds at the First Notary Public Depart- -- from 5% to 2.5% propertyMauritaniaIn Janu- value. Comoros Sudan -- West Bank and Gaza In 2005, approximately 85% of Egyptian Mauritania ary 2007, a circular wasDjibouti to reiter- properties were unregistered. In 2007, ate160the requirement toSudan approval issued ment in Riyadh, making it possible to 181 Djibouti 160 West Bank and Gaza Comoros seek transfer property in 2Iraq procedures and Egypt embarked on a reform plan to Egypt from several tax agencies, rather than Morocco 2 days. lower the total cost of registration from 181 just one, in order to obtain a tax clear- 181 5.92% to 1.02% of the underlying prop- ance certificate. FIGURE 5.2 erty value, on average, in order to en- FIGURE 6.2 FIGURE 7.2 Arab economies rankings on courage registrations. The plan cut out Arab economies rankings on Saudi Arabia Arab economies rankings on the ease of registering property inspection report fees and introduced a the ease of getting credit Saudi Arabia did not have a real property protecting investors Global ranking (1­181) flat rate of 2,000 Egyptian pounds ($323) Global ranking (1­181) registry before 2005. Registration used Global ranking (1­181) SAUDI instead of charging 3% of the value of the to take place at the government notary NEW ARABIA EASIEST (1) property. Six months after Egypt reduced MALAYSIA EASIEST (1) public at no charge. In 2005, the Real ZEALAND EASIEST (1) Saudi Arabia its registration fees, revenues rose by Saudi Arabia Property Registration Law came into ef- Kuwait 20 United Arab Emirates 20 United Arab Emirates fect.20 Under the new law,SaudiBank no registration Arabia Bahrain 39%. Moreover, a new law set time limits Bahrain and Gaza Oman for the procedures required to conduct registration processing,Egypt inspection, fees were charged whenWestproperty was Bahrain a 40 Sudan 40 Kuwait site first40registered.The first time a property Algeria Iraq inspection report delivery and the review Lebanon was registered, a notarized title deed was Egypt 60 Yemen and60approval of contracts. Tunisia required; however after the first registra- 60 Lebanon Qatar In 2008, the Ministry of State for Ad- Jordan tion, notarized documentOman not neces- was 80 Tunisia ministrative Development led adminis- 80 Oman sary. Since 2005, a newQatar 80 Real Property Mauritania trative reforms via its national real estate Algeria Registry reports to the Ministry of Jus- Iraq Syria 100 West Bank and Gaza registration project. The Moroccostrived to 100 reform tice. A judge is involvedJordan first reg- 100 Syria in the Kuwait simplify administrative QatarSudan procedures and istration but not in subsequent transfers. United Arab Emirates 120 Egypt smooth the workflow between the real 120 Mauritania 120 In 2008, the adoption of a compre- Comoros Comoros estate registry and the Egyptian Survey- Comoros hensive electronic system of registering Yemen 140 Lebanon ing Authority. It also introduced time 140 Iraq title deeds further reduced the proce- 140 Mauritania Jordan limits for several procedures. As a result West Bank and Gaza dures and time for property transfers. Tunisia Morocco 160 of160 new arrangements, theDjiboutito register In160 accordance with newSudan Morocco procedures, an Yemen time Djibouti Algeria property was significantly reduced. Syria official notary public, in the presence Djibouti 181 181 of181 legal representatives of the buyer and Kuwait seller, first to verifies that all documents In 2006, Kuwait increased staffing in its are complete. The notary public then FIGURE 8.2 registry and thus reduced the amount of FIGURE 9.2 submits the documents electronically FIGURE 10.2 Arab economies rankings on time required to carry out registration Arab economies rankings on toArabcentralized Records Department, a economies rankings on the ease of paying taxes procedures. the ease of trading across borders which prepares a new title deed show- the ease of enforcing contracts Global ranking (1­181) Global ranking (1­181) ing the buyer as the owner of the prop- Global ranking (1­181) erty.HONG KONG title MALDIVES EASIEST (1) SINGAPORE EASIEST (1) CHINA The newEASIESTdeed is immediately (1) Qatar United Arab Emirates Yemen 20 United Arab Emirates 20 Saudi Arabia 20 Tunisia Saudi Arabia Bahrain Mauritania 22 DoING BUSINESS IN THE ARAB WoRLD 2009 added to the electronic records of all title global rEform trEnds computerizing tHe registry deeds in Riyadh. After a few hours, the One of the most popular reform features representatives for the buyer and seller loWering costs has been computerizing the registry and appear a second time before the notary Across regions and economies, the most introducing online procedures that aid public, who prints a copy of the new title popular reform feature has been reduc- interaction between the notary and the deed and asks the representatives and ing property transfer taxes and fees-- registry. Computerization can be costly, 2 witnesses to sign the sale agreement, registration fees, notary fees and stamp so it is not surprising that more than which is a standard form. The signed sale duties. In 2005 and 2006 such reductions half of such reforms have been in East- agreement is scanned and saved in the were made by 7 of 10 reforming econo- ern Europe and Central Asia and OECD electronic records, while the original is mies. Big cuts were made in Africa. In high-income economies. kept in the notary public's files. 2004 the region had the highest average Computerizing registries has proved cost for property transfer, at around 13% to be highly effective. The economies that Tunisia of the property value. Today the average have done so since 2005 have seen the In 2004 Tunisia started reforming in cost is 10.5% of the property value-- time to register property drop by 45%, this area. In 2007, Tunisia computerized much lower, though still higher than the on average. In El Salvador, which com- its property files. As a result, property 6% in Latin America, the region with puterized its registry in 2006, the time to checks (to view any encumbrances and the second highest cost. Many econo- register property fell from 52 days to 33. see a history of the property) take one mies have reduced the cost of property Portugal computerized the Lisbon real day to visit the registry to log-on a com- registration by establishing a low fixed estate registries in 2007, reducing the puter, view and print files. The process registration fee rather than charging en- time from 81 days to 42. Computerizing used to take 7 days. trepreneurs a percentage of their prop- records not only facilitates registration erty value. For example: In 2005 Slovakia but also improves the preservation of the abolished its 3% real estate transfer tax records and, as a result, the security of and set a low fixed fee for expedited reg- titles. Digitizing the property registry's istration at 8,000 koruny ($286). In 2007 records and facilitating electronic ac- Egypt, as noted above, and Poland both cess can improve things, but this alone adopted similar reforms. This reform is often not enough. In 2005 Honduras tends to reduce fraud in reporting the launched a reform aimed at allowing market value of property and increase every entrepreneur online access to the tax revenue. registry's information. But online access did not resolve the many inconsistencies in information between the registry and the cadastre. To do this, the 2 agencies must be coordinated and the cadastre updated regularly. 23 Getting FIGURE 6.1 credit Rankings on getting credit are based on 2 subindicators Regulations on nonpossessory security interests in movable Strength of legal 33%62.5% 33% property rights index (0­10) 37.5% Depth33%credit of information index (0­6) Scope, quality and accessibility of credit information through public and private credit registries Note: Private bureau coverage and public registry coverage do not count for the rankings. Firms consistently rate access to credit as · Public registry coverage, which reports ·Note:The law allows a business to grant Private bureau coverage and public registry coverage do not count for the rankings. See Data notes for details. among the greatest barriers to their op- the number of individuals and firms a non possessory security right in a eration and growth. Doing Business con- covered by a public credit registry as a single category of revolving movable structs two sets of indicators of how well percentage of the adult population. assets, without requiring a specific credit markets function: one on credit · Private bureau coverage, which re- description of the secured assets. registries and the other on legal rights of ports the number of individuals and · The law allows a business to grant borrowers and lenders. Credit registries, firms, covered by a private credit a non possessory security right in institutions that collect and distribute bureau as a percentage of the adult substantially all of its assets, without credit information on borrowers, can population. requiring a specific description of the greatly expand access to credit. By shar- The strength of legal rights index mea- secured assets. ing credit information, they help lenders sures the degree to which collateral and · A security right may extend to future assess risk and allocate credit more effi- bankruptcy laws protect the rights of or after-acquired assets and may ex- ciently. And they free entrepreneurs from borrowers and lenders and thus facilitate having to rely on personal connections lending. This year, three main changes Table 6.2 alone when trying to obtain credit. Three were made to improve this measure fur- Who has the most credit information indicators are constructed to measure the ther: first, a standardized case scenario and the most legal rights for borrowers and lenders--and who the least? sharing of credit information: with specific assumptions was intro- · Depth of credit information index, duced to bring this indicator into line Legal rights for borrowers and lenders (strength of legal rights index, 0­10) which measures the extent to which with other Doing Business indicators. Most Least the rules of a credit information sys- Second, the indicator now focuses not tem facilitate lending based on the on tangible movable collateral, such as Sudan 5 Iraq 3 Bahrain 4 Yemen 2 scope of information distributed, the equipment, but on revolving movable Kuwait 4 Djibouti 1 ease of access to information and the collateral, such as accounts receivable Saudi Arabia 4 Syria 1 quality of information. and inventory. Third, the indicator no United Arab 4 West Bank 0 Emirates and Gaza Table 6.1 longer considers whether management Where is getting credit easy-- remains in place during a reorganiza- Borrowers covered by credit registries and where not? tion procedure, better accommodating (% of adults) Easiest GLOBAL Most difficult GLOBAL economies that adopt reorganization Most Least (AW RANK 1­5) RANK (AW RANK 16­20) RANK procedures. The strength of legal rights Bahrain 35.8 Jordan 0.97 Saudi Arabia 59 Iraq 163 index includes 8 aspects related to legal Kuwait 31.2 Algeria 0.20 United Arab 68 West Bank 163 Oman 23.4 Djibouti 0.18 Emirates and Gaza rights in collateral law and 2 aspects in Tunisia 14.9 Mauritania 0.17 Bahrain 84 Djibouti 172 bankruptcy law: Saudi Arabia 14.1 Yemen 0.07 Egypt 84 Yemen 172 · Any business may use movable assets Kuwait 84 Syria 178 as collateral while keeping posses- Note: The rankings on borrower coverage reflected in the table include only Arab economies with public or private credit registries (15 in total). Another 5 Arab economies have no credit registry and Note: Rankings on the ease of getting credit are based on the sion of the assets, and any financial therefore no coverage. sum of the strength of legal rights index and the depth of credit information index. institution may accept such assets as Source: Doing Business database. Source: Doing Business database. collateral. -- West Bank and Gaza 181 Djibouti 160 West Bank and Gaza 160 Comoros Iraq Egypt Morocco 24 181 181 DoING BUSINESS IN THE ARAB WoRLD 2009 FIGURE 5.2 tend automatically to the products, FIGURE 6.2 FIGURE 7.2 Arab economies rankings on theproceeds registering property Arab economies rankings on Arab economies rankings on Which arab EconomiEs rEformEd in thE past 5 yEars? nal assets. ease ofor replacements of the origi- the ease of getting credit protecting investors Global ranking (1­181) Global ranking (1­181) Global ranking (1­181) · General description of debts and Most of the Arab economies that re- obligations is permitted in collateral SAUDI NEW ARABIA EASIEST (1) MALAYSIA EASIEST (1) formed in 2007/08 continued previous ZEALAND EASIEST (1) agreements and in registration docu- Saudi Arabia Saudi Arabia reforms as follows: Kuwait ments, so that all types of obligations 20 United Arab Emirates United Arab Emirates Saudi Arabia and debts can be secured by stating 20 20 Bahrain Bahrain Algeria West Bank and Gaza a maximum rather than a specific Oman Egypt In 2006, the central bank instructed fi- Bahrain 40 amount between theSudan parties. 40 Kuwait nancial institutions toAlgeria 40 declare to the · A collateral registry is in operation Iraq Lebanon public credit registry their unpaid credits Egypt 60 that is unified geographically and Yemen 60 Tunisia and loans as well as any other negative 60 Lebanon by asset type and that is indexed by Qatar Jordan information. Oman 80 the name of the grantor of a security Tunisia 80 Oman 80 Qatar Mauritania Algeria Iraq right. Syria Morocco Egypt Jordan ·100Secured creditors areWest firstandwhen paidBank Gaza 100 Qatar In1002005, Egypt reducedSyriaminimum re- its a debtor defaults outside an insol- Kuwait Sudan porting amount and introduced a nega- United Arab Emirates 120vency procedure or when a business Egypt 120 Mauritania tive list for credit cards and car loan 120 Comoros is liquidated. Comoros Comoros balances below 30,000 EGP. As a result, Yemen ·140Secured creditors areLebanon 140 Iraq 140 an automatic stay orJordan not subject to West Bank and Gaza banks were given moreMauritania Tunisia comprehensive Morocco moratorium Djibouti information on borrowers. Sudan 160on enforcement procedures when a Djibouti 160 Yemen 160 InJanuary2006,Egypt'scentralbank Morocco debtor enters a court-supervised reor- Algeria Syria approved the rules and regulations to set Djibouti 181ganization procedure. 181 up and operate a new private credit bu- 181 · The law allows parties to agree in a reau. In 2007, a new private credit bureau collateral agreement that the lender Tunisia's central bank now collects and was opened for business. Its shareholders FIGURE 8.2 Arab economies rankings on may enforce its security right out of distributes more detailed information FIGURE 9.2 are 27 banks and a social development FIGURE 10.2 FIGURE thecourt. of paying taxes Arab ease from banks--including positive infor- Arab economies rankings on fund, all with equal shares. The board of Arab economies rankings on the ease of trading across borders the ease of enforcing contracts the e Global ranking (1­181) mation (like loan amounts) and negative Global ranking (1­181) directors has 11 members (8 from banks Global ranking (1­181) Globa Which arab EconomiEs information (like arrears and defaults). and 3 as technical experts). The central rEformEd in 2007/08? HONG KONG MALDIVES EASIEST (1) Also, individuals and firms can now SINGAPORE EASIEST (1) bankCHINA regulatesEASIESTbureau. the (1) JA Qatar consult their credit data in all central United Arab Emirates In 2008, the central bank issued Yemen Morocco, West Bank and Gaza, bank offices. licensing regulations for private credit 20 United Arab Emirates Saudi Arabia 20 Tunisia United Arab Emirates, Tunisia and 20 20 Saudi Arabia Bahrain bureaus. These regulations guarantee Mauritania Egypt reformed. Oman United Arab Emirates In Febru- Egypt that borrowers have the right to view Kuwait 40 Kuwait 40 ary 2007, the credit bureau, Emcredit, 40 Djibouti all40of their credit information. The pri- Qatar Egypt's central bankBahrain new regu- issued started collecting dataQatar repayments Oman by60individual borrowersTunisia on vate credit bureau can charge individu- 60 Jordan 60 lations that gave borrowers the right to West Bank and Gaza Morocco as well as firms. als6012 Egyptian poundsMoroccoinspection Bahrain per inspect the data stored in the private Iraq This has improved the supervision of the Jordan and companies 25 Egyptian pounds per Lebanon 80 credit bureau. 80 80 80 Lebanon debt level of banks and borrowers and Lebanon inspection. West Bank and Gaza Comoros has helped develop a culture of sharing West Bank and Gaza Algeria 100 Morocco guaranteedDjibouti 100 the right of bor- credit information. 100 Kuwait Kuwait 100 Jordan rowers to inspect dataSudan concerning their Syria creditworthiness, which helps potential 120 Syria West Bank and Gaza's central bank 120 Algeria In1202007, Kuwait's private credit bureau Saudi Arabia 120 Oman added retailers (such as furniture ven- Sudan borrowers control the Tunisiaaccuracy of their now has an online system that allows dors that offer credit)Unitedsuppliers of as Arab Emirates 140 credit profile at the same time it helps 140 Morocco 140 Yemen a140systematic upload ofYemen Comoros information on credit information. TheIraqresult is more Comoros 160 financial institutions with better data for Egypt all loans extended by the financial in- Sudan complete credit information.Egypt risk assessments. 160 Algeria stitutions in member Mauritania which 160 countries, 160 Djibouti 181 Mauritania increases the credit information avail- Iraq Syria 181 ability. 181 181 DoING BUSINESS ToPICS 25 financial institutions, the Department out easily and with certainty whether Morocco of Economic Development, the public there are competing claims on the col- In 2008, Morocco passed a law that al- prosecution departments and the Min- lateral. India stands out among those lowed borrowers to inspect the data in its istry of Labor. From all these sources, that have taken such a step. Its huge geo- credit registry. It also clarified the process Emcredit collects positive and negative graphic area and large population make for contesting data and correcting errors information on individuals and firms. its creation of an online, unified national in its new private credit bureau. Borrowers have the right to consult their database of security rights in movable data, under the Data Protection Law. assets a notable achievement. Saudi Arabia Information gathered from government Many economies around the world In 2004 Saudi Arabia's public registry agencies (companies' operations, corpo- passed new secured transactions laws. cut the minimum loan size for collecting rate structure and bounced checks, for For example: Peru introduced a new data substantially, almost doubling the example) is updated daily. Data gathered bill on guarantees based on movable number of borowers recorded. In 2007, from banks are updated twice a month, property in 2006. Now almost any type Saudi Arabia launched its private credit although payments are typically due only of movable asset--tangible or intangible, bureau. The bureau issues reports on once a monthly. present or future--can secure a loan, companies' credit exposure and includes and assets no longer have to be described their financial statements and ownership West Bank and Gaza specifically. More than 20 different types details. In addition, mobile telephone In 2007, the West Bank and Gaza's public of pledges were consolidated into one. companies started providing informa- credit registry lowered the minimum The country's 17 collateral registries have tion to the bureau. loan requirement from 10,000 USD to been combined as well. zero and instructed all banks to disclose More than a quarter of the reforms Tunisia all the loans granted to customers. In in credit information involved setting In 2004 Tunisia started reforming in this 2008, the public credit registry set up up new registries: 19 economies saw area. In 2007, Tunisia's public credit reg- on-line access to credit information for the creation of private credit bureaus; 8 istry for firms and individuals abolished lenders. As a result, 2 years of credit others set up new public credit registries its minimum loan requirement. In the information are currently accessible to Worldwide, the biggest gains were in same year, a new law authorized the cen- lenders on-line. Furthermore, all infor- Eastern Europe and Central Asia, where tral banks' credit registry to collect and mation is updated digitally and remotely, nearly half the economies established distribute data to banks on individuals' with more detail and fewer processing either a public credit registry or a private loans in arrears. (Before, the amount of errors. Specifically, credit enquiries and credit bureau, followed by the Middle loans in arrears was collected, but was new loans are updated immediately East and North Africa, where many Arab not distributed.) The law guarantees that while outstanding loan payments are economies are found. In 20 economies borrowers listed can consult the public updated monthly. across the globe, reforms expanded the credit registry's data. Individuals and range of credit information collected and firms can request this information any global rEform trEnds distributed by public or private credit one of the central bank's offices. Fur- registries. In 13 of these, the public reg- thermore, on-line access to individual Allowing parties to agree to pursue out- istry eliminated the minimum cutoff for and commercial credit reports is being of-court enforcement if the debtor de- recording loans, more than quadrupling developed. Since January 2007, credit in- fault has been the most popular reform coverage on average. What made this formation has become more comprehen- feature strengthening the legal rights reform possible in many cases was devel- sive. In addition, the amount of overdraft of borrowers and lenders. The ability to oping the information infrastructure and and arrears were separated, making it make such an agreement can persuade shifting from a paper-based to an online possible to provide better details for each lenders wary of long court procedures to system. In 8 economies, private credit type of debt. make a loan in the first place. Economies bureaus expanded the sources of credit that have allowed such agreements in- information to nonfinancial institutions United Arab Emirates clude Croatia, France, Ghana, Honduras, such as utilities (like mobile phone com- In 2007, a new private credit bureau, India, the Kyrgyz Republic, Peru and panies) or retailers (like supermarkets Emcredit, started operating. Initially, Vietnam. and furniture stores). Such changes took Emcredit collected information (specifi- Establishing a geographically uni- place in Bulgaria, Georgia, Kazakhstan, cally, company registration and bounced fied collateral registry that covers sub- Kenya, Kuwait, Nicaragua, Saudi Arabia checks) solely from the Department stantially all movable property has been (as mentioned above) and Trinidad and of Economic Development of Dubai. another popular reform feature. Such a Tobago. Now Emcredit also collects data from registry allows potential lenders to find 26 Protecting FIGURE 7.1 investors Rankings on protecting investors are based on 3 subindicators Requirements Liability of CEO on approval and disclosure and board of directors of related-party in related-party transactions 33.3% transactions 33.3% Extent Extent of of director disclosure liability index index 33.3% Ease of shareholder suits index Type of evidence that can be collected before and during the trial Good protections for minority share- the transaction? What information must Note: See Data notes for details. transaction and the standard of proof holders are associated with larger and be disclosed? What company documents applicable to a civil suit against the more active stock markets. Thus both can investors access? What do minority directors. governments and businesses have an in- shareholders have to prove to get the These three indices are averaged to create terest in reforms strengthening investor transaction stopped or to receive com- the strength of investor protection index. protections. To document some of the pensation from Mr. James? Three indices This index ranges from 0 to 10, with protections investors have, Doing Busi- of investor protection are constructed higher values indicating better investor ness measures how economies regulate based on the answers to these and other protection. a standard case of self-dealing, use of questions. All indices range from 0 to corporate assets for personal gain. 10, with higher values indicating more Table 7.2 The case facts are straightforward. protections or greater disclosure. Where are investor protections strong-- Mr. James, a director and the major- · The extent of disclosure index covers and where not? ity shareholder of a public company, approval procedures, requirements Extent of disclosure index (0­10) proposes that the company purchase for immediate disclosure to the public Most Least used trucks from another company he and shareholders of proposed trans- owns. The price is higher than the going actions, requirements for disclosure Lebanon 9 Djibouti 5 Bahrain 8 Iraq 4 price for used trucks. The transaction in periodic filings and reports and Egypt 8 United Arab 4 goes forward. All required approvals are the availability of external review of Oman 8 Emirates obtained, and all required disclosures transactions before they take place. Saudi Arabia 8 Sudan 0 made, though the transaction is preju- · The extent of director liability index Tunisia 0 dicial to the purchasing company. Share- covers the ability of investors to hold Extent of director liability index (0­10) holders sue the interested parties and Mr. James and the board of directors Most Least the members of the board of directors. liable for damages, the ability to re- Saudi Arabia 8 Egypt 3 Several questions arise. Who approves scind the transaction, the availability Kuwait 7 Djibouti 2 of fines and jail time associated with Table 7.1 United Arab 7 Morocco 2 Emirates Where are investors protected--and self-dealing, the availability of direct Comoros 1 where not? or derivative suits and the ability to Algeria 6 Lebanon 1 Qatar 6 Most protected require Mr. James to pay back his per- GLOBAL Least protected GLOBAL (AW RANK 1­5) RANK (AW RANK 16­20) RANK sonal profits from the transaction. Ease of shareholder suits index (0­10) Kuwait 24 Mauritania 142 · The ease of shareholder suits index Easiest Most difficult Saudi Arabia 24 Tunisia 142 covers the availability of documents West Bank 38 Sudan 150 West Bank 7 Oman 2 and Gaza that can be used during trial, the and Gaza Morocco 164 Syria 2 Tunisia 6 Bahrain 53 ability of the investor to examine the United Arab 2 Djibouti 177 Bahrain 5 Emirates Algeria 70 defendant and other witnesses, share- holders' access to internal documents Comoros 5 Morocco 1 Note: Rankings are based on the strength of investor protection Egypt 5 Djibouti 0 index. of the company, the appointment Source: Doing Business database. of an inspector to investigate the Source: Doing Business database. nk and Gaza Mauritania Sudan i 160 West Bank and Gaza 160 Comoros Egypt Morocco 181 181 DoING BUSINESS ToPICS 27 FIGURE 6.2 Which arab EconomiEs FIGURE 7.2 least 10% of the share capital of the n Arab economies rankings on rEformEd in 2007/08? Arab economies rankings on perty the ease of getting credit protecting investors company may ask to inspect company financial statements, annual report, list Global ranking (1­181) Egypt, Tunisia and Saudi Arabia re- Global ranking (1­181) of the guaranties, backings, securities formed NEW and sureties granted by the company and MALAYSIA EASIEST (1) ZEALAND EASIEST (1) the minutes of the shareholders meet- rabia Egypt's Capital Market Authority in- Saudi Arabia Kuwait Arab Emirates ings over the last three years. Moreover, creased protection for minority investors 20 United Arab Emirates 20 Saudi Arabia Bahrain West Bank and Gaza the law prohibited the granting of loans, by introducing new listing rules for the Egypt Bahrain grants, securities or advances to the top Cairo and Alexandria Stock Exchanges, 40 Kuwait 40 Algeria managers of a company as well as to their which require an independent body to Lebanon Egypt spouses, ascendants and descendants. assess transactions between interested 60 Tunisia 60 Lebanon Finally, outside auditors were required parties before transactions are approved. Jordan Oman to periodically review the efficiency of a 80 Qatar nia It80also expands the scopeOmanthe disclosure Algeria of company's internal controls. required regarding transactions between Iraq Morocco Jordan As previously mentioned, Tunisia nk and Gaza interested parties. A review committee 100 Qatar 100 Syria enacted its Economic Initiative Law in from each company must see that an Sudan United Arab Emirates 2008. This new law reinforces its pre- independent financial Mauritaniaexamines 120 adviser 120 Comoros vious legislation regarding prejudicial s any related-party transactions and con- Comoros Yemen related-party transactions shareholders' n firm that the general assembly approves 140 Iraq 140 Mauritania access to companies' internal documents. these types of transactions. The main West Bank and Gaza Tunisia In addition, it gives shareholders owning o Sudan i goal of this reform is toDjibouti investors 160 Yemen protect 160 Morocco at least 10% of the shares can request the by increasing transparency.Syria Djibouti judge) to appoint an inspector with full 181 181 powers to access internal documentation Saudi Arabia provided new provisions of the company. to increase the protection of minority FIGURE 9.2 shareholders by prohibiting interested FIGURE 10.2 Which arab EconomiEs global rEform trEnds FIGURE 11.2 n Arab economies rankings on Arab economies rankings on rEformEd in thE past 5 yEars? Arab economies rankings on the ease of trading across borders parties from voting on the approval of In addition to the reforms carried out the ease of enforcing contracts going for more disclosure the ease of closing a business Global ranking (1­181) related-party transactions, and increas- ing sanctions against directors for mis- by Egypt, Saudi Arabia and Tunisia in Global ranking (1­181) Across Global regions, the most popular reform ranking (1­181) conduct. In EASIEST Saudi Arabia's Minis- SINGAPORE 2008, (1) 2007/08, only Tunisia's reforms reach HONG KONG CHINA EASIEST (1) feature hasJAPAN been toEASIEST require greater dis- (1) try of Trade and Industry modified the United Arab Emirates back to 2005. Yemen closure of related-party transactions, as Arab Emirates company law that addresses approval we saw in Egypt. The resultsBahrain2002 Qatar of a 20 Saudi Arabia 20 Tunisia 20 rabia and disclosure requirements for related- Bahrain Tunisia Mauritania global survey on corporate governance Tunisia party transactions. In the past, directors Egypt In 2005, Tunisia amended its corpo- Kuwait provide one explanation: around 90%Algeria were allowed to participate in the process 40 Djibouti rate law multiple times, improving the 40 Qatar of the investors surveyed want more 40 Saudi Arabia of approval of a transaction between Qatar transparency of corporate dealings and Oman transparency in the day-to-dayOman manage- interested parties. Now,Tunisia 60 60 Morocco directors are not strengthening internalMorocco 60 Bahrain controls on di- ment of companies. What do they mean Morocco nk and Gaza allowed to vote to approve a transac- rector misconduct (misuse of corporate by more80transparency? UnifiedKuwait Syria account- 80 parties. The new 80 Lebanon n tion between interestedJordan Lebanon assets). The amendments and additions West Bank and Gaza ing standards, immediate disclosure of Yemen s legislation also increases the legal rem- West Bank and Gaza to the corporate law aimed to guarantee Algeria major transactions and moreJordan 100 involve- i edies available in casesKuwait 100 dealing with the the company's financial accountability 100 Jordan ment of minority investors in major deci- Lebanon liability of directors forSyria misconduct. In and protect minority shareholders' inter- Saudi Arabia sions and transactions. 120 Egypt the event directors areAlgeria 120 found liable for ests. The scope of the reforms provided 120 Sudan Requirements for greater disclosure, Djibouti the prejudices caused to a company in Oman a baseline of operational transparency United Arab Emirates while popular, are unlikely to succeed ev- 140 United Arab Emirates o a140transaction where they had a personal Yemen (opening the books ofIraq company to 140 the erywhere. Extensive disclosureMauritania Comoros standards interest, they must repay the profit made Comoros Sudan shareholders); requiredComoros 160 Egypt external checks require the necessary infrastructure to Iraq from the transaction. 160 Mauritania on managerial actionsDjibouti 160 (strengthening communicate the informationSudan 181 effectively nia Iraq auditor responsibility);Syria and prohibited and, more importantly, people such as West Bank and Gaza Tunisia's 2008 Economic Initiative Law 181 abusive actions (prohibiting company 181 lawyers and accountants to comply with allows minority investors to request the loans to directors, managers and their the standards. Many poor countries lack judge to rescind prejudicial related-party families). The new law provides that a both. They may have stock exchanges-- transactions. group of shareholders representing at but no website to post the information 28 DoING BUSINESS IN THE ARAB WoRLD 2009 on. And they may have certified accoun- impetus for its regulatory reforms. tor Protection Act of 2002, commonly tants--but in such small numbers that Countries that want to reform can known as the Sarbanes-Oxley Act. Bo- complying with disclosure requirements choose to amend existing regulations or tswana and Mozambique followed the is virtually impossible. Take Vietnam. Its start from scratch, depending on how South African model. As a reformer securities law has significant disclosure up-to-date their current legislation is. In from Mozambique explains, "Our previ- and reporting requirements, but the coun- 2007 Georgia amended its securities leg- ous code was inherited from Portugal. try still lacks the systems to store and islation by adding provisions regulating Today our main commercial partner is monitor the information electronically. disclosure and approval of transactions South Africa, and we are surrounded by between interested parties. Belarus, Co- countries that have the same model. We finding inspirAtion for reform lombia and Thailand did the same. Other prefer to adopt legislation that would en- Crisis can be an important engine of countries, such as Mozambique and Slo- able us to attract more investment from reform. The East Asian financial crisis venia, started from scratch. Adopting an South Africa and make life easier for our and corporate scandals such as those in- entirely new law offers an opportunity main investors." volving Enron, Parmalat and WorldCom to reform other areas--such as business Even the best regulations will make triggered regulatory reforms around the registration, directors' duties, disclosure little difference if the court system is world. These crises exposed weaknesses rules and issuance of shares. weak. Bangladesh and Montenegro have in markets previously considered models Reformers often find inspiration in laws setting out strong disclosure re- of sound regulation. Countries affected economies with a similar legal origin quirements and extensive obligations for by the crises reformed their laws. So did or in their main commercial partners. directors. But with the most basic com- other countries, using the experiences to Mexico's securities law reform took into mercial disputes taking more than 1,000 avoid the same mistakes. Mexico, for ex- account aspects of a U.S. law--the Public days to resolve in Bangladesh and more ample, used the U.S. experience to create Company Accounting Reform and Inves- than 500 in Montenegro, these laws may not have the desired effect. 29 Paying taxes FIGURE 8.1 Rankings on paying taxes are based on 3 subindicators Number of hours Firm tax liability per year to prepare, as % of pro ts before le returns all taxes borne and pay taxes 33.3% 33.3% Time Total tax rate 33.3% Payments Number of tax payments per year Note: See Data notes for details. Taxes are essential. Without them there of transactions that the company com- amount of taxes and mandatory con- would be no money to provide public pleted during the year. Respondents are tributions payable by the company amenities, infrastructure and services asked how much in taxes and mandatory during the second year of operation. which are crucial for a properly function- contributions the business must pay and This amount, expressed as a percent- ing economy. But sometimes small and what the process is for doing so. age of commercial profit, is the sum medium size companies opt not to pay The business starts from the same of all the different taxes payable after taxes and operate in the informal sector financial position in each economy. All accounting for various deductions instead. Potential entrepreneurs may opt the taxes and mandatory contributions and exemptions. out of business altogether. The cost of paid during the second year of opera- Businesses care about what they get for this is less revenues for the government tion are recorded. Taxes and mandatory their taxes and contributions, such as the and fewer jobs for its citizens. One way contributions are measured at all levels Table 8.2 to encourage formal business operation of government and include corporate Who makes paying taxes easy--and who and enhance tax compliance is to ease income tax, turnover tax, all labor taxes does not? and simplify the process of paying taxes and contributions paid by the company Payments (number per year) for businesses. (including mandatory contributions paid Fewest Most The Doing Business tax survey re- to private pension or insurance funds), Qatar 1 Algeria 34 cords the effective tax that a small and property tax, property transfer tax, div- Iraq 13 Djibouti 35 medium company must pay and the idend tax, capital gains tax, financial Kuwait 14 Mauritania 38 administrative costs of doing so. Imag- transactions tax, vehicle tax, sales tax Oman 14 Sudan 42 ine a medium-size business, TaxpayerCo and other small taxes (such as fuel tax, Saudi Arabia 14 Yemen 44 that started operations last year. Doing stamp duty and local taxes). A range of Time (hours per year) Business asks tax practitioners in 181 standard deductions and exemptions are Fastest Slowest economies to review TaxpayerCo's fi- also recorded. United Arab 12 Syria 336 nancial statements and a standard list Three indicators are constructed: Emirates Morocco 358 · Number of tax payments, which takes Bahrain 36 Algeria 451 Table 8.1 Qatar 36 Where is it easy to pay taxes-- into account the method of payment, Mauritania 696 Oman 62 and where not? the frequency of payments and the Egypt 711 Saudi Arabia 79 Easiest number of agencies involved in our GLOBAL Most difficult GLOBAL (AW RANK 1­5) RANK (AW RANK 16­20) RANK standardized case study. Total tax rate (% of profit) Qatar 2 Morocco 119 · Time, which measures the number of Lowest Highest United Arab 4 Yemen 138 hours per year necessary to prepare Emirates Qatar 11 Yemen 48 Egypt 144 and file tax returns and to pay the Saudi Arabia 7 United Arab 14 Comoros 49 Algeria 166 Emirates Oman 8 corporate income tax, value added Tunisia 59 Mauritania 174 Kuwait 14 Kuwait 9 tax, sales tax or goods and service tax Algeria 74 and labor taxes and mandatory con- Saudi Arabia 14 Mauritania 99 Bahrain 15 Note: Rankings are the average of the economy rankings on the number of payments, time and total tax rate. tributions. Source: Doing Business database. · Total tax rate, which measures the Source: Doing Business database. -- Kuwait Lebanon Algeria 140 -- Algeria Syria Syria Mauritania 140 Oman 140 Mauritania 30 -- 160 -- Comoros Sudan Djibouti --DoING BUSINESS IN THE ARAB WoRLD 2009 West Bank and Gaza Mauritania Sudan quality of infrastructureDjiboutisocial ser- 181 160 West Bank and Gaza 160 Iraq and Tunisia introduced an option for filing Comoros vices. Efficient tax systems tend to have tax returns online whileEgypt 181 paying the taxes Syria Morocco 181 less complex tax arrangements, compris- in person at a tax office. This is a practi- In 2006, in an effort to encourage foreign ing of straightforward compliance proce- FIGURE 5.2 cal intermediate step toward a full online FIGURE 6.2 and domestic investments and increase FIGURE 7.2 dures and clear laws. Taxpayers in such Arab economies rankings on system. Arab economies rankings on tax collection, a new tax law was issued Arab economies rankings on economies often get more from their the ease of registering property the ease of getting credit lowering taxes. This was accompanied by protecting investors taxes. Simple, moderate taxes and fast, Global ranking (1­181) Which arab EconomiEs Global ranking (1­181) the Tax Evasion Law and other laws that Global ranking (1­181) cheapSAUDI administration mean less hassle rEformEd in thE past 5 yEars? carried stricter enforcement measures, for businesses, and also more revenue NEW ARABIA EASIEST (1) MALAYSIA EASIEST (1) including imprisonment. Moreover, the ZEALAND EASIEST (1) collected and better public services. Saudi Arabia While Morocco and Tunisia were the Saudi Arabia tax administration has Kuwait reformed been 20 More burdensomeUnitedregimes cre- tax Arab Emirates only two economies with tax reforms in 20 United Arab Emirates in Syria. Tax forms wereSaudi 20 unified in 2004 Arabia ate an incentive to evadeBahrain taxes. 2007/08, looking back, aBahrain number of other and were further simplified in 2007 to West Bank and Gaza Oman Bahrain 40 the conform to the new tax laws. In Septem- Sudan tax40reforms tool place inEgyptlast 5 years. Kuwait 40 Which arab countriEs Iraq ber 2006, preparations started for a new Algeria rEformEd in 2007/08? Algeria Lebanon Egypt 60 Yemen 60 Tunisia VAT to be enacted later in 2008 or 2009. 60 Lebanon Qatar In 2006, Algeria reduced the standard Jordan Oman Morocco and TunisiaTunisia Tunisia 80 reformed. corporate tax rate from 30% to 25%. 80 Oman 80 Qatar Mauritania The reduction was part Algerialarger effort of a In 2006, Tunisia reduced its standard Iraq Morocco lowered theSyria 100 standard corpo- intended to reduce theMorocco 100 tax burden on corporate tax rate from 35% to 30%--ex- Jordan rate tax rate from 35% to 30%. West Bank and Gaza companies and foster investments. Qatar 100 cepting specific industries such as fi- Syria Kuwait Sudan United Arab Emirates 120 Egypt 120 nance. It also lowered its higher VAT 120 Tunisia made filing and paying taxes Mauritania Comoros Comoros Egypt Comoros rates from as high as 29% to 18% rate. Yemen easier by expanding electronic options. 140 Lebanon In1402005, Egypt issued a new tax law that Iraq However, to limit the revenue loss, trans- 140 Mauritania Although companies have been able to Jordan reduced corporate income tax rate from West Bank and Gaza actions that had the lowest VAT rate Tunisia file and pay taxes online since 2005, Morocco 40% or 32% to 20%. ItDjibouti eliminated its (10%) were increased toSudan12%. many have been reluctant to pay their 160 Djibouti 160 state development dutyYemenof profits), (2% 160 In 2008, Tunisia moved to accept tax Morocco taxes this way. To address their concerns Algeria reduced withholding taxSyria interest and on declarations and payments in 3 ways: Djibouti while easing the administrative burden, 181 181 royalties from 32% to 20% flat rate and · On paper declaration and payment at 181 raised the sales tax on telecommunica- the tax administration bureau FIGURE 8.2 tion from 10% to a flat 15% rate. The FIGURE 9.2 ·FIGURE Online declaration and online pay- 10.2 FIGUR Arab economies rankings on law also allowed for electronic filing to Arab economies rankings on ment Arab economies rankings on Arab the ease of paying taxes same time. the ease of trading across borders ·theeaseofenforcingcontractsat the Online declaration and payment the Global ranking (1­181) Global ranking (1­181) tax administration bureau. Global ranking (1­181) Globa Morocco, HONG KONG MALDIVES EASIEST (1) In 2006, the tax laws concerning corpo- SINGAPORE EASIEST (1) WestCHINA Bank and Gaza EASIEST (1) Qatar rate income tax, personal income tax, United Arab Emirates In 2006, West Bank andYemen decreased Gaza 20 United Arab Emirates value added tax (VAT),Saudi 20 registration du- Arabia its 20 VAT from 16% to 14.5%. At the same Tunisia 20 Saudi Arabia Bahrain Mauritania Oman ties and tax incentives were abrogated. Egypt time, it decreased corporate income taxes Kuwait 40 Kuwait Provisions existing in these laws were 40 Djibouti from 16% to 15%. 40 Qatar 40 Bahrain gathered in an Assessment and Collec- Qatar Oman 60 Jordan tion Tax Book while the VAT rate for 60 Tunisia Yemen 60 Morocco 60 West Bank and Gaza bank transactions increased from 7% to Morocco In 2005, facing public pressure, Yemen Bahrain 80 80 Iraq 10%. In 2008, a new tax law decreased 80 Jordan reduced its sales taxes.Lebanonnew sales 80 The Lebanon the corporate tax rate from 35% to 30%, Lebanon taxes ranges from 2.5% to 10%, with 5% West Bank and Gaza Comoros Bank and Gaza 100 100 Djibouti as100we mentioned above,WestKuwait and increased applied to most sectors.Algeria new sales 100 Jordan The Sudan the taxable base. Syria tax was a final tax replacing a produc- Saudi Arabia 120 120 Syria 120 Algeria tion tax in which a good's tax would be 120 Sudan Tunisia Sudan Oman accumulated over the different stages of United Arab Emirates 140 140 Morocco In1402005, Sudan decreased its corporate Yemen its140 production. Iraq Yemen income tax from 30% toComorosHowever, 10%. Comoros 160 Egypt Egypt 160 the tax went up again toSudanin 2006. 30% Algeria 160 Mauritania 160 Djibouti 181 Mauritania Iraq Syria 181 181 181 DoING BUSINESS ToPICS 31 global rEform trEnds economies--from Azerbaijan to Colom- and training. Azerbaijan provided free bia and Lesotho--have made e-filing software to taxpayers 6 months before cutting rAtes possible, and the list is growing. implementing its new system, giving Reducing corporate income tax rates has These reforms can ease the adminis- them time to become familiar with it. been the most popular reform feature trative burden of paying taxes. But it can Distributing the tax software early paid around the world. More than 60 econo- take time for them to make a real differ- off in more than one way: users also sug- mies have done this. Countries can in- ence. In Argentina as well as in Tunisia, it gested improvements simplifying the de- crease tax revenue by lowering rates and took almost 3 years before smaller firms sign of the software's interface. To make persuading more businesses to comply felt the impact. The reason is that small the new online system more effective; with the more favorable rules. For exam- firms often lack the software needed for Azerbaijan's government also introduced ple, look at the Russian Federation's large electronic filing and payments. Moreover, advanced accounting software to help tax cuts in 2001: Corporate tax rates fell taxpayers often distrust online systems in computing tax payments. This has from 25% to 24%, and a simplified tax when it comes to dealing with sensitive especially benefited medium-size com- scheme lowered rates for small business. financial information. panies, which make up a sizable share Yet tax revenue increased--by an annual Businesses in Azerbaijan are ben- of the users. For smaller enterprises-- average of 14% over the next 3 years. One efiting from an ambitious tax modern- those more likely to lack access to the study shows that the new revenue was ization reform started by the govern- internet--Azerbaijan's Ministry of Taxes due to greater compliance. ment 3 years ago. Electronic payment is installing computer stations around and filing systems have been in place the country that are linked to the cen- going electronic since March 2007. The goal is to have tral database. Kenyan and Mozambican Introducing electronic filing has been 100% online filing. Tax authorities have taxpayers are also enjoying the benefits a popular and effective way to make it been actively promoting online filing of electronic tax systems. Companies in easier to pay taxes. Businesses can enter among businesses paying value added Kenya can complete and submit social financial information online and file it tax. The efforts have had results: 95% of security forms online. Complying with with one click--with no calculations and these businesses are using the service, labor tax obligations used to take them no interaction with tax officials. Errors completing more than 200,000 online 72 hours a year; now it takes about 20% can be identified instantly, and returns transactions in the first 3 months of 2008 less time. Their Mozambican counter- processed quickly. In Hong Kong (China) alone--and saving an average 577 hours parts can complete social security forms businesses file an electronic corporate a year. Online filing is also available for electronically and are looking forward to tax return and pay corporate income tax corporate income tax. Reforms introduc- being able to submit them online, which annually. Complying with tax require- ing electronic payment and filing systems will further simplify the task. ments takes just 80 hours a year. Sixty often need to provide public education 32 Trading across FIGURE 9.1 borders Rankings on trading across borders are based on 3 subindicators All documents required Document preparation, by customs and customs clearance and other agencies technical control, ports and terminal handling, 33.3% 33.3% inland transport and handling Documents Time to to export export and import and import 33.3% Cost to export and import US$ per 20-foot container, no bribes or tari s included Note: See Data notes for details. The benefits of trade are well docu- the two parties and ending with delivery as costs for documents, administrative mented; as are the obstacles. Tariffs, of the goods. For importing the goods, fees for customs clearance and technical quotas and distance from large markets the procedures measured range from control, terminal handling charges and greatly increase the cost of goods or the vessel's arrival at the port of entry to inland transport. The cost measure does prevent trading altogether. But with big- the shipment's delivery at the importer's not include tariffs or duties. ger ships and faster planes, the world warehouse. For exporting the goods, the Economies that have efficient cus- is shrinking. Global and regional trade procedures measured range from the toms, good transport networks and agreements have reduced trade barri- packing of the goods at the factory to fewer document requirements, making ers. Yet Africa's share of global trade is their departure from the port of exit. compliance with export and import pro- smaller today than it was 25 years ago. Payment is by letter of credit and the cedures faster and cheaper, are more So is the Middle East's, excluding oil ex- time and cost for issuing or securing a competitive globally. That can lead to ports. Many entrepreneurs face numer- letter of credit is taken into account. more exports; and exports are associated ous hurdles to exporting or importing To make the data comparable across with faster growth and more jobs. Con- goods, including delays at the border. countries, several assumptions about the versely, a need to file many documents They often give up. Others never try. In business and the traded goods are used. is associated with more corruption in fact, the potential gains from trade facili- The business is of medium size, customs. Faced with long delays and fre- tation may be greater than those arising employs 60 people, and is located in the quent demands for bribes, many traders from only tariff reductions. periurban area of the economy's most may avoid customs altogether. Instead, Doing Business compiles procedural populous city. It is a private, limited they smuggle goods across the border. requirements for trading a standard liability company, domestically owned, This defeats the very purpose in having shipment of goods by ocean transport. formally registered and operating under border control of trade to levy taxes and Every procedure and the associated doc- commercial laws and regulations of the ensure high quality of goods. uments, time and cost, for importing and economy. The traded goods are ordinary, exporting the goods is recorded, starting legally manufactured products trans- Which arab EconomiEs with the contractual agreement between ported in a dry-cargo, 20-foot FCL (full rEformEd in 2007/08? Table 9.1 container load) container. Where is trading easy--and where not? Documents recorded include port fil- Djibouti, Egypt, Morocco and Easiest ing documents, customs declaration and Syria reformed. GLOBAL Most difficult GLOBAL (AW RANK 1­5) RANK (AW RANK 16­20) RANK clearance documents, as well as official United Arab 14 Yemen 126 documents exchanged between the par- Djibouti improved its port administra- Emirates Comoros 129 ties to the transaction. Time is recorded tion and eliminated some document re- Saudi Arabia 16 Sudan 139 in calendar days, from the beginning to quirements for exporting and importing, Bahrain 21 Mauritania 158 Egypt 24 the end of each procedure. Cost includes reducing the time to import from 18 to Iraq 178 Djibouti 35 the fees levied on a 20-foot container 16 days, the documents to export from 8 in U.S. dollars. All the fees associated to 5 days, and the documents to import Note: Rankings are the average of the economy rankings on the documents, time and cost required to export and import. with completing the procedures to export from 6 to 5 days. Source: Doing Business database. or import the goods are included, such 181 Djibouti West Bank and Gaza Comoros Iraq Egypt Morocco 181 181 DoING BUSINESS ToPICS 33 FIGURE 5.2 FIGURE 6.2 FIGURE 7.2 Arab economies rankings on Table 9.2 Arab economies rankings on Arab economies rankings on Which arab EconomiEs the ease of registering property Who makes importing easy--and who the ease of getting credit Egypt's port of Alexandria continued protecting investors rEformEd in thE past 5 yEars? Global ranking (1­181) does not? Global ranking (1­181) to upgrade its facilities and speed up Global ranking (1­181) Documents (number) SAUDI customs clearance, while banks delivered WhileNEWDjibuti, Egypt, Morocco and Fewest ARABIA EASIEST (1) Most letters of credit faster this year, leading to MALAYSIA EASIEST (1) Syria continued their reforms. look- ZEALAND EASIEST (1) Djibouti 5 Saudi Arabia Iraq 10 a reduction of 1 day forSaudi and 3 days exportArabia ing back, Algeria Jordan, Tunisia, Kuwait Saudi Arabia 20 5 United Arab Emirates Kuwait 10 for20import. United Arab Emirates Saudi Arabia and United Arab 20 Saudi Arabia Bahrain 6 Bahrain Morocco 10 Bahrain West Bank and Gaza Egypt Emirates also reformed. Egypt 6 Oman Oman 10 Morocco abolished its container ID Bahrain Sudan 40 6 Sudan Mauritania 11 40 Kuwait 40 card thereby speeding up the import and Algeria Algeria Time (days) Iraq Lebanon Egypt 60 Yemen export process. 60 Tunisia In602007, in an effort toLebanonthe smug- fight Fastest Qatar Slowest Jordan gling of counterfeit goods, Algeria's Min- Oman United Arab 80 10 Tunisia Lebanon 38 Syria eased up the entry requirements 80 Oman istry of Commerce introduced another 80 Qatar Emirates Mauritania West Bank 40 for private banks which then sped up Algeria layer of compulsory inspections to the Iraq Bahrain 15 Syria and Gaza the issuing of letters ofMorocco This led credit. clearance process. An inspections agency Jordan Egypt 100 15 West Bank and Gaza42 Mauritania 100 to a reduction of 2 days in document Qatar 100 acting on behalf of the Ministry of Com- Syria Djibouti 16 Kuwait Sudan 49 Sudan United Arab Emirates Morocco 120 18 Egypt Iraq 101 preparation time for both exports and 120 Mauritania merce was assigned the responsibility. 120 Comoros imports in Syria. However, the inspections were not co- Cost (US$ per container) Comoros Comoros Yemen 140 Lebanon 140 Iraq ordinated with those already carried out 140 Mauritania Least Jordan Most Tunisia had a negative reform by re- West Bank and Gaza by Algerian customs. The new inspec- Tunisia United Arab 587 Morocco Yemen 1,475 quiring all freight arriving at its port to Djibouti tions required the sameSudan documents used Emirates 160 Djibouti 160 160 Mauritania 1,523 be accompanied by a unit of the customs Yemen in the pre-existing customs inspection Morocco Qatar 657 Algeria Syria 1,625 authority and thereby increased the time Syria plus a certificate of conformity. A third Djibouti Saudi Arabia 181 678 Sudan 2,900 181 Egypt 823 to181import by 1 day. inspection was conducted if the product Iraq 3,900 Bahrain 845 requires a phytosanitary certificate. In FIGURE 8.2 FIGURE 9.2 addition, the scanning of all container- FIGURE 10.2 Arab economies rankings on Arab economies rankings on ized cargo--imports and exports--be- Arab economies rankings on the ease of paying taxes Who makes exporting easy--and who the ease of trading across borders came compulsory, thus adding an addi- the ease of enforcing contracts Global ranking (1­181) does not? Global ranking (1­181) tional cost to the clearance process. Port Global ranking (1­181) Documents (number) charges were further revised to make HONG KONG Fewest MALDIVES EASIEST (1) Most SINGAPORE EASIEST (1) themCHINA uniformEASIESTall containers--large for (1) Qatar United Arab Emirates Yemen Bahrain 5 United Arab Emirates8 Syria or small, imported or exported, loaded Saudi Arabia or20unloaded--which led to a 10% in- Tunisia Djibouti 20 5 Saudi Arabia Comoros 10 20 Bahrain Mauritania Lebanon 5 Oman Iraq 10 Egypt crease in container charges, on average. Kuwait Qatar 40 5 Kuwait Oman 10 40 Djibouti At40the same time, the customs clearance Qatar Saudi Arabia 5 Bahrain Mauritania 11 Qatar fees charged by brokersOmantheir profes- for Time (days) 60 Jordan 60 Tunisia sional services droppedMorocco40 to 50% 60 by Fastest West Bank and Gaza Slowest Morocco because the approval ofBahrainlicense applica- Iraq Jordan Lebanon United Arab 80 10 80 tions to be a customs broker eased up 80 Lebanon Comoros 30 Emirates Lebanon and competition floodedWest Algeria in.Bank and Gaza Comoros Yemen 31 Bahrain West Bank and Gaza 100 14 Djibouti Mauritania 35 100 100 Egypt 14 Kuwait Jordan Sudan Sudan 35 Djibouti Morocco 14 Syria Saudi Arabia Syria Iraq 102 Syria 120 15 120 Algeria In1202007, the implementation of an elec- Sudan Tunisia Oman tronic system helped expedite the cus- United Arab Emirates 140 Cost (US$ per container) Morocco 140 Yemen toms clearance process with goods being 140 Iraq Least Yemen Most Comoros cleared even before their vessel arrives. Comoros Egypt Sudan Egypt United Arab 160 618 Currently, documents can be sent elec- Algeria Syria 1,190 160 160 Emirates Mauritania Djibouti Mauritania Algeria 1,248 tronically from Dubai, which is Djibouti's Saudi Arabia 681 Iraq Syria 181 Mauritania 1,520 181 main trade partner. Further, customs 181 Morocco 700 Sudan 2,050 clearance forms are available on-line and Jordan 730 Iraq 3,900 Tunisia 733 can be directly filled out electronically. Moreover, there has been increased co- Source: Doing Business database. ordination with the banks to authorize 34 DoING BUSINESS IN THE ARAB WoRLD 2009 the transfers of customs duties, port straddle carriers, bomb-carts, tractors fees and other charges. Customs offices and other vehicles. Reforms were also Syria have also extended their working hours made in the management of port person- In 2005, Syria started modernizing its to include week-ends and holidays. In nel and their work environment, which customs offices in order to implement 2008, Dubai intervened to help Djibouti's contributed to higher productivity levels an electronic data interchange system, port run more efficiently: It streamlined and fewer human errors. simplify procedures, increase transpar- the document preparation process for ency and improve the productivity of imports and exports, which cut time in Morocco its staff. By 2006, IT divisions in several customs. As mentioned, Djibouti's recent In 2006, Morocco implemented a new customs directorates were set up, help- reforms cut 2 days off the time to import risk-based system that classified traders ing to roll out new IT equipment and and 3 days off the time to export. in 3 categories: A (superior), B (inter- software (specifically, ASYCUDA from mediary) and C (remaining). Category A EDI), starting in four main locations. So Egypt companies go through customs with only far, two data input centers have been set In 2005, Egypt created a single window random inspections (i.e., 1% of compa- up in Damascus and Lattakia to allow for documentation, put time limits on nies). If traders commit customs infrac- traders to submit declarations electroni- customs proceedings and consolidated tions, their operations are not blocked. cally. In 2008, these customs reforms the number of relevant departments As a result, customs clearance times have were fortified with the easing up of entry from 26 to 5. Two years later, in 2007, dropped. In addition, Morocco's port re- requirements for private banks which Egypt continued its broad reforms by form law divided port authority among 2 then sped up the time it took to issue improving the training of custom of- agencies (COMANAV and SODEP) with letters of credit. ficials, conducting selective inspections terminal management awarded to pri- of cargo and enhancing the existing fa- vate agents. The moves reduced of port Tunisia cilities at its Domiatta and Alexandria fees by about 30%. Plans are underway In 2008, Tunisia introduced a new re- ports with electronic tracking systems. In to establish a one-stop shop, linking cus- quirement for arriving freight within 2008, Egypt further upgraded the facili- toms with various government ministries the port zone, which has prolonged the ties at its Alexandria port, constructing involved in providing approvals related import process and increased its cost. a new 600-meter berth and warehouses, to exporting and importing. The customs authorities also state that which resulted in shorter handling times. In 2008, Morocco eliminated the they are in the process of studying al- In addition, customs personnel were in- container ID card for both imports and ternatives, such as replacing the unit structed to complete customs clearance exports. As a result, a shipping company that must currently accompany arriving of all goods within 24 hours. Meanwhile, can simply provide an electronic link to freight with a tracking technology (GPS reforms in the banking sector reduced a trader to use for electronic declaration. and GPRS). the time required to obtain a letter of The net result is a reduction in the time credit. required to prepare relevant documents. United Arab Emirates In 2005, improvements in the infrastruc- Jordan Saudi Arabia ture of Jebel Ali port reduced the time In 2006, Jordan improved its infra- In 2007, Saudi Arabia streamlined its for export and import significantly. Im- structure with information technology trade documentation system by allowing provements included a port expansion solutions. Its container terminal was the transfer of data electronically and by with new berths and of the electronifi- completely computerized, with state-of- abolishing the requirement for a con- cation of relevant documents, such as the-art software (such as NAVIS and IFS) sular certificate. Prior to this, exporters custom declarations. to ensure the optimal stacking of con- to Saudi Arabia were required to obtain tainers at the container yard and other an attestation from the Saudi Embassy efficiencies. As a result of electronic pro- regarding the type of goods, prices and cesses, traders were able to track the quantities, prior to shipment. There has status of their shipments and the move- also been an improvement in port capac- ments of the container within the con- ity, allowing Saudi Arabia's port of Jed- tainer terminal, thereby aiding them in dah to clear more containers per day. planning and speeding up clearance. To complement these soft infrastructure im- provements, Jordan has made significant investments in hard infrastructure-- such as gantry cranes, rubber tire cranes, DoING BUSINESS ToPICS 35 global rEform trEnds looking beyond customs clients. I sometimes ask them to bring a While customs reform remains impor- clearer invoice," says Loraine, a customs The number of economies implementing tant to trading across borders, several broker in Jamaica. new reforms to facilitate cross-border other reforms also play a part. Indeed, Payment of customs duties need trade has been on the rise globally. In in the Doing Business sample, customs not delay the release of cargo. Why not 2005 there were 25 reformers. In 2007/08 clearance accounts for less than 20% introduce a bond or financial guaran- there were 34. Africa increasingly took of the time to export, from the time tee, allowing goods to be released pend- the lead over the 5-year period. In the the export contract is concluded to the ing completion of the paperwork? Many Arab World on average, 4 economies time the goods leave the port. Approv- economies, such as Malaysia, have done reformed each year. als from ministries, health authorities, just that. security agencies, inspection agencies, Countries save costs by synchroniz- speeding cleArAnce port authorities, banks and immigration ing documents and procedures at the The most popular reform to facilitate authorities account for most delays. border. Thanks to a border cooperation trade has been the implementation of Countries increasingly recognize the agreement with Sweden and Finland, an electronic data interchange system. importance of a comprehensive approach Norway is estimated to have avoided Electronic transmission of documents to trade facilitation. Korea has brought more than $9 million a year in costs not only speeds the clearance of goods; it together 69 government agencies as well to customs authorities and $48 million often reduces the possibilities for paying as private participants through its single- a year in costs to economic operators. bribes. That changed with the advent of window system. Senegal has brought In some regions trade is hindered by electronic data processing. But to avoid together 15 agencies. El Salvador has bureaucratic hurdles at borders. In Af- a dual electronic and manual customs linked 3 government departments and rica and Central Asia border crossings clearance process, the new systems must continues to expand this network. account for significant delays in trade. be complemented by supporting legisla- But change has begun. South Africa and tion authorizing electronic transactions. finding inexpensive reforms Mozambique are creating a one-stop bor- Economies implementing an elec- Some needed trade reforms are expen- der post at the Lebombo­Ressano Garcia tronic data interchange system saw the sive, such as building roads or port infra- crossing. Indeed, regional approaches to time to clear goods cut by 3 days on structure. But much can be done without trade facilitation may yield the biggest average. Reforms in this area also help heavy spending. Clarifying the rules is an benefits in both regions. increase the predictability of clearance important start. times. Before Pakistan implemented its More publicity, training and regular electronic system, only 4.3% of goods meetings with exporters on the clearance were cleared within a day; for a quarter process can also make a difference. In of the goods, clearance took a week. Now Jamaica, where such efforts are in place, 93% of goods are cleared within a day. customs brokers with low error rates are Where electronic data interchange rewarded with access to fast-track clear- systems are in place, it is easier to man- ance procedures, while those with high age risk in customs clearance, another error rates face more scrutiny. "Because I popular reform. Around the world, thir- want my goods cleared quickly, I do not teen economies have introduced risk- accept all documents sent to me by my based inspections alongside electronic transmission of documents. In econo- mies that use risk-based inspections, 19% of containers are inspected on aver- age; in economies that do not, 53% are. 36 Enforcing FIGURE 10.1 contracts Rankings on enforcing contracts are based on 3 subindicators Days to resolve Attorney, court and commercial sale dispute enforcement costs before courts as % of claim value 33.3% 33.3% Time Cost 33.3% Procedures Steps to le claim, obtain and enforce judgment Note: See Data notes for details. Where contract enforcement is efficient, capita). The claim is filed before a court in In the absence of efficient courts, businesses are more likely to engage the economy's largest business city with firms undertake fewer investments or with new borrowers or customers. Doing jurisdiction over commercial cases worth business transactions. Business tracks the efficiency of the ju- 200% of the income per capita and is And they prefer to involve only a dicial system in resolving a commer- disputed on the merits. Judgment is 100% small group of people who know each cial dispute, following the step-by-step in favor of the Seller and is not appealed. other from previous dealings. evolution of a commercial sale dispute Seller enforces the judgment and the It is notable that no Arab economies before local courts. The data is collected money is successfully collected through a reformed in this area over the past year. through study of the codes of civil proce- public sale of Buyer's assets. dure and other court regulations as well Rankings on enforcing contracts are Table 10.2 as through surveys completed by local based on 3 sub-indicators: Where is enforcing contracts the most litigation lawyers (and, in a quarter of the · Number of procedures, which are efficient--and where the least? countries, by judges as well). defined as any interaction between Procedures (number of steps) The dispute concerns a contract for the parties or between them and the the sale of goods between two businesses judge or court officer. This includes Fewest Most (the Seller and the Buyer) both located steps to file the case, steps for trial Lebanon 37 United Arab 50 Emirates in the economy's largest business city. and judgment and steps necessary to Yemen 37 Jordan 39 Iraq 51 The Seller sells and delivers goods, worth enforce the judgment. Tunisia 39 Oman 51 200% of the economy's income per capita, · Time, which counts the number of Djibouti 40 Sudan 53 to the Buyer. The Buyer refuses to pay on calendar days from the moment the Syria 55 the grounds that they were not of ade- Seller files the lawsuit in court until Time (days) quate quality. The Seller sues the Buyer to payment is received. This includes recover the amount under the sales agree- both the days on which actions take Fastest Slowest ment (200% of the economy's income per place and the waiting periods in be- Mauritania 370 Lebanon 721 tween. Comoros 506 Sudan 810 Iraq 520 Syria 872 Table 10.1 · Cost, which is recorded as a percent- Where is enforcing contracts easy--and Yemen 520 Egypt 1,010 where not? age of the claim (assumed to be Tunisia 565 Djibouti 1,225 Easiest equivalent to 200% of income per Cost (% of claim) GLOBAL Most difficult GLOBAL (AW RANK 1­5) RANK (AW RANK 16­20) RANK capita). Three types of costs are re- Least Most Yemen 41 Iraq 148 corded: court costs (including expert Kuwait 13.3 Lebanon 30.8 Tunisia 72 Comoros 150 fees), enforcement costs (including Oman 13.5 Jordan 31.2 Mauritania 84 Egypt 151 costs for a public sale of Buyer's as- Bahrain 14.7 Iraq 32.5 Kuwait 94 Djibouti 159 sets) and attorney fees. Yemen 16.5 Djibouti 34.0 Qatar 98 Syria 174 Justice delayed is often justice denied. Sudan 19.8 Comoros 89.4 Note: Rankings are the average of the economy rankings on And in many economies only the rich the procedures, time and cost to resolve a commercial dispute Source: Doing Business database. through the courts. can afford to go to court. For the rest, Source: Doing Business database. justice is out of reach. United Arab Emirates nia 120 Comoros s Yemen DoING BUSINESS ToPICS 37 140 Mauritania nk and Gaza Tunisia i Which arab EconomiEs Sudan global rEform trEnds capita. In Zambia it is 15 times income 160 rEformEd in 2007/08? Morocco per capita. Minimum thresholds can be Djibouti Reformers considering ways to improve justified as a way to avoid overloading No Arab economies reformed in this 181 the regulatory environment for busi- newly established specialized courts. But area. nesses often shy away from tackling a balance must be struck between access court reforms. This is not surprising. The to justice and a reasonable caseload for FIGURE 10.2 n Arab economies rankings on successFIGURE of court reforms is low: on rate11.2 rankings on the new courts. A pragmatic approach is borders the ease of enforcing contracts average,Arab 1 in 4 attempted reforms the ease of closing a business onlyeconomies to lower minimum thresholds as courts Global ranking (1­181) succeedGlobalreducing costs and delays. in ranking (1­181) are gradually able to accept more cases. Even successful reforms often take years This is better than having courts inun- HONG KONG CHINA EASIEST (1) to produceJAPAN visible results. EASIEST (1) dated with cases from the start. Arab Emirates Yemen As a general rule, economies that Bahrain Countries in Latin America have rabia 20 Tunisia rank high on the ease of enforcing con- Qatar 20 sped criminal cases by using oral pro- Mauritania tracts continually reform their courts Tunisia ceedings rather than an exchange of Kuwait to adjust40to changing businessAlgeria written documents. Argentina and Chile Denmark is an example. In 2006 it intro- Saudi Arabia realities. i 40 Qatar Oman Oman started this trend in the 1990s. Colom- 60 Morocco duced special rules for cases below about 60 Morocco bia, Guatemala, Honduras and Mexico o Bahrain $8,600. That reduced the number of cases Kuwait are now working on similar reforms. 80 80 Lebanon before the general courts in Copenhagen Syria And Colombia plans to extend oral pro- n West Bank and Gaza by 38%. Reformers did not stop there. Yemen ceedings to commercial cases over the nk and Gaza Algeria 100 Jordan 100 In March 2008 a new law introduced next 4 years. Jordan mediation after a successful pilot showed Lebanon While oral proceedings are a re- Saudi Arabia 120 Egypt 120 Sudan that two-thirds of all cases referred to Djibouti cent trend in Latin America, countries United Arab Emirates mediation in 2003­05 resulted in an 140 United Arab Emirates in other regions have a longer history amicable settlement. The message: stay with them. Take Luxembourg, which 140 Iraq Mauritania s Comoros focused160 improvement, evenComorosare on if you ranks second on the ease of enforcing Egypt already doing well. Iraq contracts. There, parties do not exchange nia 160 Djibouti 181 Sudan long, written pleadings in commercial Syria introducing commerciAlWest courts Bank and Gaza cases. Instead, they exchange only the 181 ThemostpopularreformfeatureinAfrica written evidence they intend to rely on Which arab EconomiEs over the past 5 years has been introducing during oral arguments before the judge. rEformEd in thE past 5 yEars? specialized commercial courts, as Mauri- This saves several months. tania did, or commercial sections within Mauritania reformed over the past 5 existing courts. Some African countries imposing strict deAdlines years. Since 2006, 105 new magistrates have a longer track record with spe- In 1995 the "arbitrazh courts" became have been hired to help speed up hear- cialized courts or divisions--including responsible for dealing with commercial ings. In 2007, Mauritania's commercial Kenya, Madagascar, Tanzania, Uganda disputes in the Russian Federation. In courts replaced specialized commercial and Zambia. As a result, the average time 2002, to make proceedings faster, the chambers, which may have only had one to resolve a commercial dispute dropped Russian Federation revised its commer- sitting judge. Moreover, the government by about 19%, from 604 days to 492. Be- cial procedural code. Its most signifi- increased the compensation for judges. cause judges must be hired and trained, cant innovation was to introduce strict With increased capacity, commercial rules adjusted and funding ensured, mandatory time limits: 2 months for court judges are able to hold two hear- achieving such reductions in time usu- a full hearing, 1 month for accelerated ings per month with a capacity to review ally takes years. In Ghana, for example, a procedures. approximately 15 cases per hearing, or commercial division began operating in Most Central Asian countries cop- 30 cases per month. Overall, delays have its high court in March 2005. Doing Busi- ied the Russian procedural rules, includ- been reduced only slightly without af- ness 2008 records a drop in time from ing the strict deadlines. Judges are held fecting the overall execution time for 552 days to 487--more than 2 years later. accountable for respecting the deadlines, contract enforcement. Specialized commercial courts are often with those who do best standing better With so few reforms to strengthen criticized because they deal only with the chances for promotion. Not surprisingly, contract enforcement among Arab econ- financially most important cases. Those of the 10 economies with the fastest aver- omies, this is clearly an area requiring in Tanzania, for example, accept only age times to enforce a contract, half are more effort in the future. cases with a value 66 times income per in Eastern Europe and Central Asia. 38 Closing a business FIGURE 11.1 Rankings on closing a business are based on 1 subindicator Function of time, cost and other factors such as lending rate and the likelihood of the company continuing to operate 100% Recovery rate Note: Time and cost do not count separately for the ranking. The economic crises of the 1990s in thebankruptcyprocess.Itisassumedthat Table 11.2 Note: Time and cost do not count separately for the ranking. Where is bankruptcy the most efficient-- See Data notes for details. emergingmarkets,fromEastAsiatoLatin the company is a domestically owned, and where the least? America, from Russia to Mexico, raised limited liability corporation operating Time (years) concerns about the design of bankruptcy a hotel in the country's largest business systems and the ability of such systems city. The company has 201 employees, 1 Fastest Slowest to help reorganize viable companies and main secured creditor and 50 unsecured Tunisia 1.3 Egypt 4.2 close down unviable ones. In countries creditors. Assumptions are also made Saudi Arabia 1.5 Jordan 4.3 Morocco 1.8 Djibouti 5.0 where bankruptcy is inefficient, unviable about the debt structure and future cash Algeria 2.5 United Arab 5.1 businesses linger for years, keeping assets flows. The case is designed so that the Bahrain 2.5 Emirates and human capital from being reallocated company has a higher value as a going Mauritania 8.0 to more productive uses. concern, that is, the efficient outcome is Cost (% of estate) The Doing Business indicators iden- either reorganization or sale as a going tify weaknesses in the bankruptcy law concern, not piecemeal liquidation. The Least Most as well as the main bottlenecks in the data are derived from questionnaires an- Kuwait 1 Egypt 22 bankruptcy process. In many developing swered by attorneys at private law firms. Oman 3.5 Lebanon 22 Algeria 7 Qatar 22 countries bankruptcy is so inefficient that Three measures are constructed Tunisia 7 Saudi Arabia 22 creditors hardly ever use it. In countries from the survey responses: the time to Yemen 8 United Arab 30 such as these, reform would best focus on go through the insolvency process, the Emirates improving contract enforcement outside cost to go through the process and the Recovery rate (cents on the dollar) bankruptcy. recovery rate, how much of the insol- The data on closing a business are vency estate is recovered by stakeholders, Highest Lowest developed using a standard set of case taking into account the time, cost, depre- Bahrain 63.2 Lebanon 19.0 assumptions to track a company going ciation of assets and the outcome of the Qatar 52.7 Egypt 16.8 Tunisia 52.3 Djibouti 15.9 through the step-by-step procedures of insolvency proceeding. Algeria 41.7 United Arab 10.2 Table 11.1 Bottlenecks in bankruptcy cut into Saudi Arabia 37.5 Emirates 0.0 Where is it easy to close a business-- the amount claimants can recover. In Mauritania 6.7 and where not? countries where bankruptcy is used, this Easiest Note: The rankings reflected in the table include only Arab GLOBAL Most difficult GLOBAL is a strong deterrent to investment. Ac- economies with a practice of bankruptcy (16 in total). Another 4 (AW RANK 1­5) RANK (AW RANK 16­20) RANK have no practice. cess to credit shrinks, and nonperform- Source: Doing Business database. Bahrain 25 Mauritania 148 Qatar 31 Comoros 181 ing loans and financial risk grow because Tunisia 32 Iraq 181 creditors cannot recover overdue loans. Algeria 49 Sudan 181 Conversely, efficient bankruptcy laws can Saudi Arabia 57 West Bank 181 encourage entrepreneurs. The freedom and Gaza to fail, and to do so through an efficient Note: Rankings are based on the recovery rate: how many cents process, puts people and capital to their on the dollar claimants (creditors, tax authorities and employees) most effective use. The result is more recover from the insolvent firm. Source: Doing Business database. productive businesses and more jobs. DoING BUSINESS ToPICS 39 Which arab EconomiEs protection of creditors' rights and helped nies. Italy now allows distressed compa- Gaza rEformEd in 2007/08? the continuity of the business. As a re- nies to seek an agreement with creditors sult, the time for insolvency was reduced before entering formal bankruptcy and Saudi Arabia was the only reformer from 2.5 years in 2004 to 1.3 years in with no prerequisites. That permits the in the Middle East and North Africa. Its 2005. companies to continue operating. Ministry of Commerce introduced strict With so few reforms to improve the Besides OECD high-income econo- deadlines for bankruptcy procedures. ability to close a business among Arab mies, several in East Asia and Pacific Auctions of debtors' assets are expected economies, this is clearly an area requir- also empowered creditors. Indonesia to take place quicker than before. As a re- ing more efforts. expanded the powers of creditors' com- sult, the process to determine the fate of mittees so they can file and vote on re- irates a company in financial jeopardy (i.e., sale global rEform trEnds organization plans. China adopted a new as going concern, piecemeal sale of as- bankruptcy law in 2007, its first since sets, or approval of a reorganization plan) expAnding creditors' rigHts 1949, significantly strengthening credi- can range from 12 to 18 months. Once a Elsewhere in the world, expanding credi- tors' rights. Secured creditors now rank judgment has been made and the fate of tors' rights has been the most popular first in payment priority. Vietnam also the company is determined, recovery of reform feature over the past 5 years. gave higher priority to secured creditors, payment is fairly expeditious--creditors Seventeen economies have empowered and removed priority for tax claims, can expect to recover some monies owed creditors: China, the Czech Republic, when it changed its 1993 bankruptcy law within 1 month of judgment. Denmark, Finland, France, Hungary, In- in 2004. donesia, Italy, Korea, Poland, Portugal, FIGURE 11.2 Arab economies rankings on Puerto Rico, Romania, Serbia, Slovakia, speeding bAnkruptcy proceedings the ease of closing a business the United States and Vietnam. Giving The second most popular reform feature Global ranking (1­181) creditors more say in the process speeds in closing a business has been intro- the resolution of bankruptcy and is likely ducing or tightening deadlines in court JAPAN EASIEST (1) to result in the continuation of the busi- procedures and streamlining appeals. Bahrain ness. Allowing creditors a greater role in Sixteen economies have undertaken such Qatar 20 decision making increases the recovery reforms: Armenia, Bulgaria, Colombia, Tunisia rate. Reforms expanding the powers of Estonia, Georgia, Lithuania, Portugal, Algeria 40 creditors have been most concentrated Puerto Rico, Romania, Saudi Arabia, Ser- Saudi Arabia Oman among OECD high-income economies. bia, Slovakia, Spain, Tunisia, the United 60 Morocco Finland gave creditors the right to set Kingdom and the United States. Impos- Kuwait up a creditors' committee to advise the ing time limits facilitates fast resolution 80 Syria administrator. France and Korea now of bankruptcy, avoiding deterioration in Gaza Yemen allow the creditors' committee to vote on a company's value over time. 100 Jordan the reorganization plan. Denmark en- This type of reform has been most Lebanon couraged creditors to report to the court popular in Eastern Europe and Central 120 Egypt any trustee actions that appear to delay Asia, where no fewer than 8 econo- Djibouti irates 140 United Arab Emirates the process. The court can then replace mies have reformed in this direction in Mauritania the trustee if it decides--based on the the past 5 years. Romania, Bulgaria and 160 Comoros creditors' reports--that the trustee is in- Estonia restricted procedural appeals. Iraq competent. Several economies, including In 2004 Romania reduced the time al- 181 Sudan Finland and France, granted higher pri- lowed for each appeal from 30 days to West Bank and Gaza ority to creditors in bankruptcy claims. 10, shortening the total duration of the France gave a "supersecured" position to bankruptcy procedure from 55 months Which arab EconomiEs creditors that lend money to distressed to 40. Bulgaria restricted opportunities rEformEd in thE past 5 yEars? companies, giving them priority over for procedural appeals. Before the re- previous secured creditors. That makes it form, the initial decision could be ap- Saudi Arabia and Tunisia reformed easier for such companies to obtain new pealed to 2 higher levels of courts. Now in 2008, Saudi Arabia reformed as dis- loans and continue operating. only 1 appeal is possible. Estonia allows cussed above. OECD high-income economies have debt recovery to continue even when In 2004 Tunisia amended the law also promoted reorganization. Finland, there is an appeal, avoiding disruption of guiding the insolvency procedure. The France, Italy and Korea made reorganiza- the process. amendment has resulted in increased tion more accessible to troubled compa- Armenia, Bulgaria, Estonia, Geor- 40 DoING BUSINESS IN THE ARAB WoRLD 2009 gia, Lithuania, Serbia and Slovakia in- troduced or tightened procedural time limits. Armenia passed a new law in- corporating time limits into the reor- ganization procedure. Serbia set strict time limits: claimants have 5 days to raise objections to the resolution, appeals must be made within 8 days after the rul- ing, and the court has 30 days to issue a decision on an appeal. Slovakia tightened time limits, speeding bankruptcy by at least 9 months in 2006. getting tHe focus rigHt When it comes to reforming bankruptcy regulations, it is often assumed that re- organization is always the best course of action. But in low-income economies reorganization does not always lead to the highest return for creditors. Mandatory reorganization proce- dures in some African economies often make matters worse. Take for example Benin, the Republic of Congo and Côte d'Ivoire. All have mandatory reorganiza- tion provisions, but their judicial systems lack the capacity to handle these types of cases. Among the main problems: fre- quent adjournments and courts that fail to hand down timely decisions. In such systems, reorganization usually ends in liquidation. The time spent in reorganization only delays the process and increases the cost. Reforms that focus on debt enforcement or fore- closure are more likely to show results in those countries. And reforms that ensure properly resourced and well-functioning courts can help a larger number of viable businesses to reorganize successfully. Overall, economies around the world are reforming toward more ef- ficient bankruptcy systems. In the years since Doing Business started collecting data on the topic, the average time to complete bankruptcy proceedings has declined by 4%. 41 Ease of doing business The ease of doing business index ranks property rights. The simple average of large markets, the quality of its infra- economies from 1 to 181. For each Iceland's percentile rankings on all top- structure services (other than services economy the index is calculated as the ics is 23%. When all economies are or- related to trading across borders or ranking on the simple average of its dered by their average percentile rank, construction permits), the security of percentile rankings on each of the 10 Iceland is in 11th place. property from theft and looting, macro- topics covered in Doing Business 2009. Morecomplexaggregationmethods economic conditions or the strength of The ranking on each topic is the simple --such as principal components and underlying institutions. There remains average of the percentile rankings on its unobserved components--yield a a large unfinished agenda for research component indicators (table 12.1). nearly identical ranking. The choice of into what regulation constitutes binding If an economy has no laws or regu- aggregation method has little influence constraints, what package of reforms is lations covering a specific area--for on the rankings because the 10 sets of most effective and how these issues are example, bankruptcy--it receives a "no indicators in Doing Business provide shaped by the context of an economy. practice" mark. Similarly, an economy sufficiently broad coverage across top- The Doing Business indicators provide receives a "no practice" or "not possible" ics. So Doing Business uses the simplest a new empirical data set that may im- mark if regulation exists but is never method. prove understanding of these issues. used in practice or if a competing regu- The ease of doing business index Doing Business also uses a simple lation prohibits such practice. Either is limited in scope. It does not ac- method to calculate the top reformers. way, a "no practice" or "not possible" count for an economy's proximity to First, it selects the economies that im- mark puts the economy at the bottom of the ranking on the relevant indicator. Table 12.1 Which indicators make up the ranking? Here is one example of how the ranking is constructed. In Iceland it Starting a business Protecting investors takes 5 procedures, 5 days and 2.6% Procedures, time, cost and paid-in minimum Strength of investor protection index: extent of capital to open a new business disclosure index, extent of director liability index of annual income per capita in fees to and ease of shareholder suits index open a business. The minimum capital Dealing with construction permits Paying taxes required amounts to 13.6% of income Procedures, time and cost to obtain construction Number of tax payments, time to prepare and file per capita. On these 4 indicators Iceland permits, inspections and utility connections tax returns and to pay taxes, total taxes as a share ranks in the 9th, 3rd, 13th and 58th of profit before all taxes borne percentiles. So on average Iceland ranks Employing workers Trading across borders in the 21st percentile on the ease of Difficulty of hiring index, rigidity of hours index, Documents, time and cost to export and import difficulty of firing index, firing cost starting a business. It ranks in the 48th percentile on protecting investors, 26th Registering property Enforcing contracts percentile on trading across borders, Procedures, time and cost to transfer commercial Procedures, time and cost to resolve a real estate commercial dispute 8th percentile on enforcing contracts, Getting credit Closing a business 8th percentile on closing a business and Strength of legal rights index, depth of credit Recovery rate in bankruptcy so on. Higher rankings indicate simpler information index regulation and stronger protection of 42 DoING BUSINESS IN THE ARAB WoRLD 2009 plemented reforms making it easier to Rwanda does not make the list. do business in 3 or more of the 10 Doing In summary, top reformers are Business topics. One reform is counted economies that have implemented 3 per topic. For example, if an economy or more reforms making it easier to do merged several procedures by creating a business and, as a result, improved their unified property registry and separately position in the ease of doing business reduced the property transfer tax, this more than other economies. The change counts as 1 reform for the purposes of in ranking is calculated by comparing attaining the 3 reforms required to be a this year's ranking with last year's back- candidate for top reformer. calculated ranking. To ensure consis- Second, Doing Business ranks these tency over time, data sets for previous economies on the increase in their years are adjusted to reflect any changes ranking on the ease of doing business in methodology, additions of new econ- from the previous year. For example, omies and revisions in data. Albania, Burkina Faso and Rwanda each reformed in 4 aspects of business regu- lation. Albania's aggregate ranking on the ease of doing business improved from 135 to 86, Burkina Faso's from 164 to 148 and Rwanda's from 148 to 139. These changes represent an improve- ment in the ranking by 49 places, 16 places and 9 places, respectively. Alba- nia therefore ranks ahead of Burkina Faso in the list of top 10 reformers. 43 Case studies Case studies were previously published in Celebrating Reform 2007 and Celebrating Reform 2008 44 DoING BUSINESS IN THE ARAB WoRLD 2009 case sTudy SAUDI ARABIA · STARTING A BUSINESS competitiveness from innovation, not inheritance Karim Ouled Belayachi and Jamal Ibrahim Haidar Starting a business in Saudi Arabia used World Trade Organization. The agency entities. Together, they proved invaluable to be limited to those who could afford responsible, the Saudi Arabia Govern- in lobbying private and public stakehold- one of the highest minimum capital re- ment Investment Authority (SAGIA), ers to support change. quirements in the world--$125,000 for improved Saudi Arabia's investor rights An outside agency, SAGIA was not limited liability companies. In July 2007 and protections in 2003 and enhanced directly responsible for business regis- Saudi Arabia slashed the minimum capi- its competitiveness with accession to the tration. Its board of directors included tal requirement and simplified business World Trade Organization in 2005. But representatives from each ministry and 2 startup procedures. What once required the $125,000 minimum paid-in capital members from the private sector nomi- 13 procedures now takes only 7. The requirement put Saudi Arabia among the nated by SAGIA's governor. Their diag- time to start a business fell from 39 days lowest 20 countries in Doing Business's nosis: entrepreneurial activity in Saudi in 2006 to only 15 in 2007. According starting a business indicator in 2006. Arabia was limited, mainly because the to Doing Business, the country's ease of After the success in 2003­05 SAGIA process to start a business was long, starting a business ranking soared from executives got direct responsibility for costly, and required a high minimum 159 in 2007 to 36 in 2008. reforming the business entry process to capital. The complex business entry pro- The need to transform the Saudi encourage domestic investment. cess stifled entrepreneurship and inno- economy was clear--from one based on First, they realigned their agency's vation. Unlike in other rich countries, inherited wealth to one based on innova- mission statement to become "to posi- small and medium-size businesses did tion. The oil sector makes up more than tion Saudi Arabia among the top 10 most not contribute much to GDP. half the gross domestic product (GDP) competitive economies in the world by but employs only 2% of the workforce. 2010 through the creation of a pro-busi- facing opposition Even if oil maintained its high price, the ness environment, a knowledge-based sector would not generate the new jobs society, and by developing world-class The main arguments for keeping a mini- to satisfy the growing workforce. The economic cities to enhance economic mum capital were protecting creditors country's population is young, with 49% development across the country." Public and protecting companies against insol- younger than 20, and a large share will advertisements seek to include every vency. The argument was not based on soon enter the labor market. That could citizen in that mission. specific events, but on a larger view of fan unemployment. To analyze performance and pro- what would be best for the country. mote improvements, the National Com- From November 2006 through Jan- hoW to rEform fast? petitiveness Center created benchmarks uary 2007 SAGIA tailored business cases political commitmEnt aimed at remodeling the business entry to address these arguments. Their point: process and rubbing out its rough bu- a minimum capital requirement made After seeing that the country was not reaucratic edges. It used Doing Busi- little sense because capital structure de- the best in the Middle East and North ness's "starting a business" methodology pends on a firm's operations and because Africa region and compared poorly with to measure results. creditors are protected by the mark-up in the rest of the world, King Abdullah of Collaboration, teamwork, and lead- asset values. Saudi Arabia said in 2006, "I want Saudi ership were key to the reform's success. The reformers challenged their de- Arabia to be among the top 10 countries SAGIA's governor, Amr Dabbagh, and tractors: If a high minimum capital re- in Doing Business in 2010. No Middle deputy governor, Awwad Al-Awwad, quirement is good, why don't the rich Eastern country should have a better in- spearheadedthereformprogrambecause countries require such large amounts? vestment climate by 2007." This drove the of their backgrounds. Dabbagh brought Why does economic informality spread creation of the 10 by 10 Initiative, with a extensive private sector experience--he in parallel with the required minimum goal to place Saudi Arabia among the 10 was a former chief executive of the Dab- capital? Why would a company that de- most competitive economies by 2010. The bagh Group, with previous work in tele- signs software have the same capital as a political structure of Saudi Arabia made it communications, media and technology, highly leveraged company that transports possible to start the reform right away. energy, and other major industries. Al- radioactive waste? If capital requirements Saudi Arabia's reforms began in Awwad brought public sector experience, reflect creditor risks, shouldn't they dif- 2003, spurred by a desire to join the as an official across several government fer across sectors? SAGIA also benefited CASE STUDIES 45 FIGURE 13.1 Timeline of business start-up reform in Saudi Arabia Source: Doing Business database. JUN 06 SEP 06 DEC 06 MAR 07 JUN 07 Governor of SAGIA initiates the establishment of a National Competitiveness Center (NCC) June 2006 SAGIA and NCC focus on reforming business start-up-- the minimum capital requirement and registration June ­July 2006 SAGIA and the NCC initiate research on international best practices and the impact of reform July ­October 2006 Governor and Deputy Governor of SAGIA meet with leadership of Ministry of Commerce to discuss reform October ­November 2006 Joint SAGIA / Ministry of Commerce committee is formed, and meets regularly to determine procedures to eliminate and merge November 2006­January 2007 In parallel, the joint-committee studies feasibility of eliminating minimum capital requirement December 2006­February 2007 Ministry of Commerce implements newly developed registration process November 2006­January 2007 Ministry of Commerce and SAGIA both address His Majesty the King with recommendation to eliminate minimum capital requirement January 2007 Expert Council is given mandate to study legal aspects of removing the minimum capital requirement. Draft proposal from the Expert Council is approved by relevant government entities February 2007 Council of Ministers approves draft law March 2007 Shoura Council together with SAGIA study and approve draft law April­ June 2007 Council of Ministers approves amendment of new article June­ July 2007 Royal Decree on 17th of July o cially states the elimination of minimum capital requirement July 2007 from internal Doing Business research to King Abdullah, every quarter. The Quick Wins to crEatE that showed that minimum paid-in capi- king wanted briefings on successful col- momEntum tal does not prevent bankruptcy. laborations with other ministries--and on the obstacles SAGIA encountered. The Major legal changes do not happen What gEts mEasurEd system made everyone accountable to the quickly. To re-engineer business regis- gEts donE highest levels of government, creating an tration, SAGIA created momentum by urgency and sense of responsibility. In advocating for smaller, simpler reforms. After the announcement of the 10-by-10 2006 the team missed the annual target, Eliminating the minimum capital would Initiative, SAGIA set up a system of key so it faced significant political pressure to have to wait for later. The reformers iden- benchmarks, with targets for each year make sturdy progress the next year. tified quick reforms--procedures with based on an aggressive goal to be among The reforms encompassed many little function that could be easily elimi- the top 10 countries by 2010. The goal agencies and departments outside nated without objection from the entity was not only to improve, but to improve SAGIA. So, for every significant step for- that administered them. compared with others. So, international ward, SAGIA used a media campaign to An example was the procedure that benchmarks were the targets. The end- thank the relevant ministries or depart- required the Chamber of Commerce to of-year bonuses of SAGIA's executive staff ments, with television spots, newspaper stamp the company books. The proce- depended on achieving or surpassing an announcements, and awards ceremonies. dure served no real purpose, and the overall Doing Business rank below 40 in "It is important to let people know that Chamber of Commerce agreed to elimi- 2006, 30 in 2007, 25 in 2008, 15 in 2009, everyone is part of the 10-by-10 Initia- nate it. Also reformed were steps that and 10 in 2010. tive and that everyone is a winner," says could be merged together. SAGIA reported its progress directly Al-Awwad. In the old registration process the 46 DoING BUSINESS IN THE ARAB WoRLD 2009 company name and a summary of the won passage through all legislative bod- morE outrEach nEEdEd articles of association were submitted ies and the king's signature. Reflecting on separately for publication in the Official the experience, the deputy governor Al- Dabbagh and SAGIA have tried to com- Gazette. No rationale other than histori- Awwad of SAGIA says, "it is sometimes municate the reforms broadly, but much cal protocol justified the separate sub- important not to wait until you have the more can be done. In this country--of missions. The Ministry of Commerce was whole perfect picture. Instead focus on more than 27 million inhabitants, where thus open to a single submission. Tech- what works." small and medium-size enterprises con- nocrats from SAGIA and the Ministry tribute only 28% of GDP--a stronger of Commerce implemented the reforms. lEvEraging intErnational media campaign is needed to motivate These quick reforms brought momentum ExpEriEncE would-be entrepreneurs to create their that made it easier for SAGIA to advocate businesses and to join the formal sector. more challenging reforms, such as reduc- Early in the implementation phase, the The team is reaching out to those people ing costs for business registration. The king sent a memo instructing SAGIA to trumpet the opportunities. General Organization of Social Insur- to hold workshops with every related A senior Saudi official who was di- ance's plans computerize its registration agency in Saudi Arabia on how to im- rectly engaged in the reform says, "We procedure and go online further stream- prove its ease of Doing Business. At these are not just content to rest on the accom- lined and simplified business startup. workshops SAGIA and others elaborated plishments. We know there is a great deal Meetings at the ministerial or deputy clear responsibilities, timetables, action more work to be done to achieve our 10- levels became the basis for memorandums points, and benchmarks. by-10 objective, but we like to look at our of understanding between the organiza- To benefit from international ex- goal as Michelangelo did when he said, tions--to formalize the agreed reforms. perience, in June 2006 reformers con- `The greatest danger for most of us is not These became a reference point to create tracted with consultants from Monitor that our aim is too high and we miss it, pressure and ensure commitment. Group--aglobalstrategicconsultingfirm but that it is too low and we reach it.'" that specializes in national economic piggybacking? development--to learn more about best only if it Works practices for business entry around the world. Monitor Group brought analytical Navigating government agencies was a expertise and strategy assistance. And it challenge, but it built understanding of was a useful outside player to assess cur- how to promote reforms. Legislative re- rent conditions and future requirements. forms required much more creativity. In collaboration with the Ministry of Discovering that the Ministry of Com- Commerce, it developed a performance merce had already drafted a new Com- measurement system for ministry staff, panies Law, SAGIA "piggy-backed" on highlighting the importance of results. the new law and received the ministry's Since its formation, the Ministry of support to add Article 164, eliminating Commerce has been keen to foster the the minimum capital requirement. domestic private sector. SAGIA benefited, From January to May 2007 the Min- spotlighting how the ministry's strategic istry of Commerce and the governor of vision aligned with its own. Within a few SAGIA lobbied the Supreme Economic months the ministry became a partner in Council, the Council of Ministers, and championing the reform. the Shura Council to pass the new law. Making the reforms sustainable But the process began to slow. Making and responsive to the private sector was use of the new law had originally acceler- imperative because stakeholder views ated matters, but questions arose about change over time. So, the National Com- articles unrelated to the minimum capi- petitiveness Center established a sec- tal requirement. SAGIA and the Ministry ond level of work at the cluster level--a of Commerce agreed that Article 164 platform for members of the private could still be fast-tracked if stripped and public sectors to meet, discuss, and from the new law. The legislative creativ- resolve issues, with the National Com- ity worked. Within a month Article 164 petitiveness Center just a facilitator. CASE STUDIES 47 case sTudy EGypT · REGISTERING pRopERTy How to raise revenues by lowering fees Jamal Ibrahim Haidar Over the last decade Egypt's economy cost 5.9% of property value. Compare they did not want relevant people to sit grew rapidly. But its property market that with less than 0.5% in New York. on the sidelines because they were not remained far below its economic poten- Egypt's fee based on a percentage of the given a role and asked to participate. tial--for government revenues and as an property value encouraged undervalua- Third, they identified steps to mitigate investment vehicle for citizens. In July tion, complicated property registration, potential resistance. 2006 the government collected just EGP and required more regulation to secure Cooperating with the Ministries of 6.1 million in registration fees, less than tax revenues. It also created opportuni- Justice and the Property Tax Author- the price of an apartment in "The First ties for corruption. ity, the Ministry of State for Adminis- Residence," a luxury building in an af- trative Development led a pilot project fluent Cairo neighborhood. Old property EmpoWEring WinnErs between March and December 2005 to registration laws from 1964, high fees, study property registration. Representa- and inefficient government agencies hin- The government identified 2 problem tives of the government departments dered the formalization of real estate. areas: high costs and cumbersome pro- met 6 times, once a month. In 3 meet- A 2004 World Bank study found cedures. According to Emad Hassan, di- ings they also invited bankers, technical that 60% of Egyptian domestic firms rector of National Database Program of experts from the World Bank and the identified tax administration as a major the Ministry of State for Administrative International Finance Corporation, and constraint, 53% identified corruption as Development, the goal was to bring in- members of the Lawyers' Syndicate to a major constraint, and 26% expected formal property into the official national present their opinions. to pay informal payments to get things framework by formalizing it. How? By The reformers understood the im- done. Firms not able to pay were ex- reducing property registration fees, sim- portance of involving the stakeholders in cluded from regular business. Ranked plifying the property registration process, face-to-face meetings, forming a stake- 147 of 175 countries on the Doing Busi- and encouraging citizens and companies holder working group in April 2005. It ness registering property indicator, Egypt to obtain titles. An inspiration was Peru's comprised the Ministry of Investment, was behind all but 2 countries in the 2003 nationwide titling program, which with its 2 arms, the General Authority for Middle East and North Africa. But re- quickly converted informal property into Investment and the Mortgage Finance form in 2006 helped Egypt cut registra- securely delineated holdings. Authority; the Ministry of State for Ad- tion fees from 5.9% to 1% of property Reducing registration fees was not ministrative Development; the Ministry value. And meanwhile state revenues a new idea in Egypt. But before 2004 the of Justice; the Public Notary Authority rose--along with the country's Doing program focused on cutting the fees to of the Ministry of Justice; the Ministry Business ranking. 3% of property value. From March 2005 of Housing; the Real Estate Taxation a new vision emerged, based on the as- Authority of the Ministry of Finance; a fortunE in unrEgistErEd sumption that the property registration is the Egyptian Surveying Authority of the propErty a public service, so fees should just equal Ministry of Water Resources and Irriga- the real cost to the government. The new tion; and governorates and municipali- Of Egypt's estimated 25 million urban model for reform recommended chang- ties under the Ministry of State for Local properties, only 7% were formally regis- ing the fees structure from one based on Development. tered. According to Hernando De Soto, percentages to one based on fixed fees. In November 2005 the working unregistered property in Egypt is worth The focus was on empowering the group delivered its final report. Its con- $241 billion--55 times the foreign direct winners from reform and engaging stake- clusion: if only half the informal proper- investment the country received over the holders. To determine who could affect ties became registered after the reform, last 200 years, including the Suez Canal the success of the reform, the Ministry the revenues would be EGP 5.5 billion, and the Aswan Dam, or 30 times the of State for Administrative Development more than half of that net profits. value of the Cairo stock exchange. conducted stakeholder mapping. First, The Ministry of State for Adminis- In 2005, 90% of properties were staff created a comprehensive stakehold- trative Development used a cost-benefit either unregistered or registered at un- ers list. Second, they brainstormed about model to identify the real cost of register- derestimated values.1 Transferring a how each person or group could make ing property: EGP 23 for drafting a title, property between domestic companies a tangible contribution to the reform-- EGP 40 for surveying and measurements 48 DoING BUSINESS IN THE ARAB WoRLD 2009 FIGURE 13.2 Timeline of property reform in Egypt Source: Doing Business database. MAR 05 JUN 05 SEP 05 DEC 05 MAR 06 JUN 06 AUG 06 Property registration pilot project conducted March­December 2005 Cost-bene t analysis performed September 2005 New fee structure established; impact on budget projected November 2005 Registration fees fromulated; consistency with existing laws studied January 2006 Reforms approved by the Cabinet January 2006 Reforms approved by the Shura Assembly April 2006 Reforms approved by the Peoples'Assembly May 2006 New property registration law published (Law 83/2006) June 2006 New law takes e ect August 2006 services, and EGP 37 for registration simple: the larger the area, the higher the focus was on the ministers of investment, services--for a total of EGP 100. fee, because people with more can afford justice, and finance, then on key stake- higher fees.2 Other key provisions: holders in the economy as a whole. The capping fEEs · The fees for document registration, Ministry of State for Administrative De- initiatory pleadings, and related velopment held specialized conferences In December 2005 the highest ministe- works are capped at EGP 2,000 and workshops tackling the housing in- rial committee of the Council of Min- ($350). dustry, mortgage finance, and property isters approved the study. The council · The notarization and registration fees registration, and the Lawyers' Syndicate, instructed Mamdouh Marei, minister of are capped at EGP 30 ($5.21). major taxpayers, and banking industry justice to make the necessary legislative · 14 other registration fees are now provided positive feedback. adjustments. A draft law was prepared merely symbolic, each less than $6. The Egyptian opposition was ini- in January 2006, along with a study to · Fees for inspections and requesting tially skeptical about who would benefit measure the draft law's effects on other registration are now gone. from the reform. "If we reduce the cost of laws. The aim was to make property The total property registration fees registering property, what would be the registration fees comparable to those in decreased from 5.9% of property value impact on the property capital and credit other emerging economies--less than to 1%. Revenues from title registrations market? How would the poor benefit?" 2% of property value in Georgia, Russia, rose 39% between the 6 months before asked an opposition parliamentarian. and Chile. The new cost structure would the reform and the 6 months after. To address those challenges, Mahmoud lower or eliminate excessive fees for in- Mohieldin, minister of investment, de- spections and requesting registration. ovErcoming opposition With veloped a shared vision. He ensured that The Shura Council approved the a sharEd vision the new cost structure would cut exces- amendment of Law No. 70 of 1964 con- sive fees and make the cost of register- cerning notarization and registration fees "The aim was not to reach consensus but ing property affordable without affecting and the land register system law in April to facilitate acceptance of the reform idea government revenues. In a January 2006 2006, only months after the Ministry of among relevant agencies. In addition to speech at the Peoples' Assembly, he em- Justice formulated the new registration identifying the reform and its impact, we phasized that the reform would benefit fees schedule in January. The Peoples' had to build a common understanding the most people possible. Assembly approved Law 83 in May 2006, of the case across the relevant public and India was his example. In July 2004 and it was issued in June 2006 and en- private agencies," says Hassan, director of the state of Maharashtra cut stamp du- forced in August 2006. The premise was National Database Program. The initial ties from 10% to 5%--and boosted total CASE STUDIES 49 FIGURE 13.3 tables with the Lawyers' Syndicate, major Cutting fees increased revenue in Egypt taxpayers, and the banking industry. It Cost to register property 6 months'revenue from property registration also convinced banks to market new (% of property value) (Egyptian pounds, millions) mortgage offerings to attract more prop- 5.9 201 erty into the Egyptian formal economy. Revenues increase Registration fee 3.0 145 long timE still a problEm A remaining challenge for Egypt is to reduce the time it takes to register prop- Fees drop Other erty. Today, it still takes an entrepreneur fees 2.9 1.0 more than 6 months to register a prop- erty transfer in Cairo. Before After Before After reform reform reform reform Hani, who sells newspapers in the streets of Cairo, sums up the dilemma: Source: Doing Business database, Egyptian Ministry of State for Administrative Development. "My house is mine and not mine. It is mine because I inherited it from my father. It is not mine because it is not stamp duty revenues by 20%, about 80% would have to commit to the effort. registered in my name. I cannot spend of that from property transfers. Now He also determined how individual and 6 months without work in order to go more properties are registered, and the team performance would become part through the property registration pro- registry holds better information on of the regular appraisal process. Depart- cess. My mother works at home. I often property values and on who owns what. ments rewarded contributions to the suc- worry that people will seize my house That supports the collection of capital cess of the transformation formally (by when I'm away." gains and property taxes as well. public recognition) and professionally Simplifying and combining proce- (by promotions). dures, keeping registry records updated, ambitious goals The Egyptian property registration continuing to digitize records, and in- reform aims to formalize 1 million prop- troducing fast-track procedures could Introducing a higher flat fee for larger erties during 2007/08, 2 million during be next steps to help Hani and others properties helped overcome the ini- 2008/09, 4 million during 2009/10, and 6 like him. tial criticism that poor people would million a year during 2010­10. Citizens not benefit. The People's Assembly de- and businesses in both rural and urban notEs manded a broad target group for the areas got encouragement to register their reform. The minister of Investment un- properties. Within a year of the law's pas- 1. OPIC, Office of Economic Development, derstood this and backed up the reform sage, revenues from title deeds jumped Issue Paper 1:2005, July 2005. with the right legislation. Osamah Saleh, from EGP 100,000 to EGP 2 million, and 2. If the property area is less than or equal Chairman of Mortgage Finance Author- total registration revenues from EGP 6.3 to 100 square meters, registration fees are EGP 500 (less than 100). If the property ity, says "We were aiming to reduce million to EGP 41.5 million. area is more than 100 but less than or property registration fees so that every equal to 200 square meters, registration property holder will have the chance to thE mEssagE--a nEW Era fees are EGP 1000 (less than $200). If receive a formal title. The poor especially for propErty rEgistration the property area is more than 200 but less than or equal to 300 square meters, would benefit because they would have registration fees are EGP 1500 (less than the chance to use their properties as col- The Ministry of Finance's successful $300). If the property area is more than lateral, start Doing Business, and achieve media campaign about its tax reforms 300 square meters, registration fees are their dreams." in January 2006 ushered in a new era EGP 2000 (less than $400). As a reform leader, Professor Ahmad for communicating legal reform to the Mahmoud Othman Darwish, minister public. The Ministry of Investment used of state for administrative development, the same approach to communicate the ensured that the work plan was robust, property registration reform, conveying the milestones were achievable, and the news, key milestones, and the benefits appropriate resources were committed to to the public. It distributed the approved do the work. He set clear expectations up law to the private sector and nongovern- front on the time individuals and teams mental organizations and held round- 50 DoING BUSINESS IN THE ARAB WoRLD 2009 case sTudy joRDAN ·TRADING AcRoSS BoRDERS A public-private partnership brings order to Aqaba's port Doina Cebotari and Allen Dennis The port of Aqaba, Jordan's only sea port, The congestion compelled some opment Corporation) that could move was the country's biggest hindrance to local traders and shipping lines serving ahead rapidly with reforms. trade in mid-2003. Waiting times for Iraq to use ports in more distant Leba- Ultimately,thepersonalinvolvement ships at berth were long, and congestion non and Syria. The cost to the Jordanian of King Abdullah II himself pushed the at the container terminal severe. Major economy from such congestion was an project forward in the face of fierce oppo- international shipping lines suspended estimated $120 million a year. But the sition. The king's support was rooted in their dealings with the Aqaba Container crisis proved to be a catalyst for a dedi- his commitment to developing Aqaba to Terminal. But by the end of 2005 the cated team of reformers to push ahead drive the growth of Jordan. When in July congestion had disappeared, and the with the painful but necessary changes 2000 the Aqaba Special Economic Zone congestion charge was gone--thanks at the port. faced stiff opposition in Parliament, the to reforms. Lloyds--the world's leading king defended the project himself.3 In maritime and transport news and analy- facEs of rEform-- 2002 the king paid 2 surprise visits in sis portal--chose the terminal as among 3 champions less than a week to the Customs Depart- the 3 best terminals in the Middle East ment in Aqaba to check on measures to and the Indian subcontinent. The commitment, hard work, and de- facilitate customs procedures.4 In mid- termination of Imad Fakhoury, Nader 2003, when the port of Aqaba was in long Waits to tradErs al-Dahabi, and Ali Abu Al-Ragheb drove crisis, the king demanded that a plan be at aQaba reforms through tough opposition. implemented within 3 months to solve Fakhoury--chairman of the Aqaba the container port problem. Recognizing Aqaba is in the northern Red Sea, at the Development Corporation, the central the key role of Aqaba's port in the success junction of trading routes between 3 con- development arm of the Aqaba Special of the Aqaba Special Economic Zone, the tinents (Europe, Asia, and Africa) and 4 Economic Zone Authority, charged with king again lent his strong commitment countries (Iraq, Israel, Saudi Arabia, and implementing the 2001­20 master plan to reforms. Syria,). Because of its multi-modal trans- for Aqaba region--was key in turning port system, it emerged in the 1980s as around the terminal. A Harvard alum- bringing in thE privatE sEctor the third-largest Red Sea port after Suez nus, Fakhoury wrote his thesis on trans- in Egypt and Jeddah in Saudi Arabia. By forming Aqaba into a freeport area. Dur- The investment required to modernize the late 1990s the port's importance in ing the mid-2003 crisis he pushed for the terminal and make it internationally the Levant had drastically fallen in the a public-private partnership to run the successful was estimated at $500 million face of stiff competition from Latakia, port, arguing that this would be "stra- over 2003­28. But Jordan's dire economic Beirut, and Dubai. Its low use masked tegically very important to Jordan, its situation, the legacy of the financial and the terminal's poor management and economy, and its in-transit trade."2 Nader currency crises of the early 1990s, meant underinvestment in soft and hard infra- al-Dahabi, chief commissioner of the that such a financial commitment would structure. It took a crisis to bring about Aqaba Special Economic Zone Authority burden the state budget. Fakhoury was a the recognition that the terminal needed during 2004­07, supported him. They staunch advocate of getting the private a serious change. worked together to raise awareness and sector involved in the running of the port In mid-2003 the terminal came to support for the public-private partner- while maintaining state ownership. a standstill, experiencing the worst con- ship at the terminal. A $1.2 million World Bank feasibil- gestion in its history. Vessels docking at Abu Al-Ragheb, twice minister of ity study in 1998 recommended a public- the port often faced anchorage waiting trade and industry (1991­93 and 1995) private partnership. Consultants from times of 150 hours.1 To compensate for and prime minister of Jordan (2000- Booz Allen Hamilton then drafted an ac- the delays, shipping lines imposed sur- 2003), was a prominent architect of eco- tion plan based on the recommendations charges of $500 per 20-feet container nomic legislation in Jordan. He oversaw as part of a $15 million, 3-year techni- load. Traders also had to bear higher a series of reform laws, among them cal assistance program under the U.S. demurrage charges because of the longer the Privatization Law 25/2000, which Agency for International Development. storage periods at the port--48 days at allowed port ownership to be transferred their peak. to a neutral party (the Aqaba Devel- CASE STUDIES 51 FIGURE 13.1 Timeline of trade reform at the Port of Aqaba, Jordan Source: Doing Business database. 1999 2000 2001 2002 2003 2004 2005 2006 King Abdullah II comes to power and embraces a national policy of economic reform February 1999 Booz Allen Hamilton presents an Action Plan for the creation of a PPP at the Aqaba Container Terminal (ACT) April 2000 Adoption of Privatization Law no.25/2000, instrumental to the creation of the PPP at the ACT July 2000 Severe congestion at the ACT January 03­ March 05 Aqaba Development Corporation (ADC) conducts an international tender for a 2-year management contract of the ACT December 03­ January 04 ADC and APM Terminals sign 2-year management contract March 2004 APM Terminals takes over the management of the ACT June 2004 ACT is declared congestion free and the congestion charge is abolished March 2005 ACT is declared one of the three best terminals in the Middle East and the Indian Sub-Continent by LLOYD'S Mid 2005 ADC and APM Terminals sign 25-year Joint Venture August 2006 crEating an oWnErship structurE to drivE rEforms public support--through radio shows, period would give Jordanians the pos- publicity campaigns, and press confer- sibility of evaluating the performance of The public-private partnership would ences. Some of the toughest and most the private partners. So, if the concerns have been impossible without a transfer vocal opposition came from Parliament. were justified, the option would be to in the ownership and control of the port The major worry was that the public-pri- not to continue in this policy direction. from the Ministry of Transport to the vate partnership might undermine na- The 2 years could be seen as a test of Aqaba Development Corporation in late tional security. Mahmoud Kharabsheh, the potential viability of a public-private 2003. The ministry, though not against a member of the powerful Legal Affairs, partnership at the container terminal. If the reform at the Port of Aqaba, would Economic, and Finance committees, the container terminal operator were to have been hobbled by the opposing views charged that the project would "jeopar- prove effective and the public were to be of its various stakeholders that it would dize the safety of the country," arguing satisfied with its results, a 25-year joint have tried to appease. Unlike the Minis- that a strategic national asset should not venture would be entered. try of Transport, the Aqaba Development fall into the hands of foreigners. To as- The Jordanian Ports and Clear- Corporation, being a new body, was not suage these concerns, the Aqaba Devel- ance Workers' Association voiced an- entangled in the numerous demands of opment Corporation, under Fakhoury's other major concern: private involve- the stakeholders. In this way it was able guidance, noted that under the model ment could bring layoffs. The port was to overcome the policy paralysis that of a public-private partnership, the port the largest employer in the region, with doomed earlier restructuring attempts would always be government owned. The 5,000 workers on its payroll, so this was by the ministry. Even so, other battles private agent would be responsible only a legitimate concern. Fakhoury and al- still had to be fought and won before the for providing services. Dahabi, in more than 20 meetings with reforms could go ahead. Rather than immediately enter a the press and the association, empha- long-term public-private partnership, sized that there would be no involuntary Engaging thE opposition the government decided to start with a dismissal of port employees. It was a and Winning public support management contract lasting 2 years. compromise. Under the management contract, the The Jordan Shipping Agents Asso- The government tried to understand and private sector would only be responsible ciation was initially opposed as well. address the concerns of people opposing for providing management services and It claimed that local companies were the reform. It made every effort to gain not any port infrastructure. This 2-year capable of managing the terminal just as 52 DoING BUSINESS IN THE ARAB WoRLD 2009 well, provided that they got the neces- businEss not as usual EasiEr tradE at aQaba sary equipment. But the reformers coun- tered that no Jordanian company could APM Terminals brought considerable Reforms at Aqaba started yielding results compare to a global container terminal expertise to managing the Aqaba Con- soon after the management takeover in operator with know-how, cost, and time tainer Port. A first signal of change was summer 2004. By February 2005 the advantages. A global operator would also visual--cleaning the port to create a new anchorage waiting time--129 hours in benefit from economies of scale in sourc- work environment. Patricio Junior, chief 2003--was completely gone. And aver- ing and knowledge. To assure critics that executive of APM Terminals Jordan, and age port stays dropped from 8 days to a only the best foreign terminal operator his team emphasized human resources, few hours, with all congestion surcharges would be chosen, Fakhoury promised a introducing an approach based on hard cancelled by 1 March 2005. New shipping transparent public tender for the man- work, discipline, and merit rather than companies started using Aqaba's port, in- agement contract. on tribal affiliation. So, recruitment was cluding the China Navigation Company. transparent and objective, with no tribal By the end of 2005 the port was dealing hiring thE bEst candidatE-- favors. Now workers get onsite and over- with 21 shipping lines and was chosen transparEntly seas training, as well as a better com- by Lloyds as among the 3 best terminals pensation package. Schemes were also in the Middle East and the Indian Sub- In early 2004 Fakhoury hired consultants put in place to reward workers for their continent. from Booz Allen Hamilton to draft 2 terms achievements. APM Terminals built an Efficiency improvements are ongo- of reference for the international tender, onsite clinic and offered all their employ- ing--but obvious for all to see. By 2007 in line with the best practices in the World ees health insurance, meals, and com- container dwelling times were down to Bank Port Toolkit. The first was for the pensation for transportation. But work- 16 days, and port productivity had more 2-year management contract, and the sec- ers were also not allowed to "moonlight," than tripled, from 9 moves an hour to ond for the 25-year joint venture with the and insubordinate workers were fired. 28. There was a 14% increase in the Aqaba Development Corporation. Of the The motivated workforce's raised number of vessels calling at Aqaba and 11 leading international container termi- productivity and performance, was a 40% increase in the average cargo size nal operators invited to participate in the aided by the new regime's $30 million per vessel. Most important, all these pro- public tender, 8 placed bids. investment in soft and hard infrastruc- ductivity gains came without any layoffs. Hutchinson Ports Holding, P&O ture. Gantry cranes, rubber tire cranes, The king was so satisfied that he offered Ports, and APM Terminals placed the 3 straddle carriers, bomb carts tractors, Jordanian citizenship to Patricio Junior. most attractive offers. APM Terminals-- and other vehicles were purchased and Trade logistics in Jordan improved, a division of A.P. Moller-Maersk group, installed soon after the management as reflected in the Doing Business trade with extensive global experience running takeover on 1 June 2004. By June 2005 indicator.5 The number of days to import container terminals in more than 40 the container terminal was 100% com- dropped from 28 in 2004 to 22 in 2007, countries--offered the highest royalty, puterized, with state of the art software. and the number of days to export fell the highest equity stake in the 25-year from 28 in 2004 to 19 in 2007. The cost joint venture, and the most attractive flExibility to accommodatE to export also dropped from $720 per 20- expansion plans. On 8 March 2004 APM local nEEds foot container in 2004 to $680 in 2007. Terminals signed a 2-year management More improvements are expected. contract with the Aqaba Development The reforms recognized local norms and Corporation. cultures, with workers and the new man- a rEmarkablE changE To evaluate APM Terminals' work in agement both willing to adjust. Before the 2-year trial, the Aqaba Development the reforms, it was common for port The turnaround at Aqaba offers 3 impor- Corporation created performance indi- workers to take several breaks, with port tant lessons for policymakers. First, it cators to measure progress at the con- operations often coming to a halt because is essential to have a strong, influential tainer terminal. Meanwhile, the Aqaba key workers were missing during prayer. team to champion reforms. In Jordan the Development Corporation lent political Of the 20 hours the port operated, about King and his reform-minded technocrats support to APM Terminals. Fakhoury 2 hours were lost to such breaks. In re- brought a visionary approach to Jordan's and al-Dahabi took the heat from the sponse, the new managers devised a shift development and the role of a vibrant media, labor unions, clearing agents, and system to accommodate daily prayers and competitive Aqaba port. Even in dif- shipping associations for the 18 months among port workers, allowing port op- ficult times, they pushed ahead with the before the results became apparent to erations to continue uninterrupted 24 reform agenda. the public. hours a day. Second, global best practices, if adapted to the local context, are a good CASE STUDIES 53 guide. It was clear that the way to mod- notEs ernize and manage the Aqaba Container Terminal was in a private-public part- 1. Aqaba Development Corporation, Presen- nership. But given all the national con- tation on the Aqaba Container Terminal cerns in Jordan about the management Presentation, 2007 of a strategic national asset by a foreign 2. Ibid. company, a graduated approach to the 3. To date, the Aqaba Special Economic Zone Authority and the Aqaba Develop- needed reform was adopted--hence the ment Corporation attracted $8 billion of initial offer of a 2-year management con- investment in the region in the period tract and a subsequent 25-year joint 2000-2007, above the 130% initial target. venture based on an excellent manage- Tax collection increased 40 fold. Most im- portant, 15,000 new jobs were created in ment performance and favorable public the Aqaba region, thus turning the Aqaba opinion. Special Economic Zone into a model for Third, to obtain the desired results, the creation of other special economic reformers must work with the best talent zones in the country. around. The Aqaba Development Cor- 4. Riad Al Khouri, "Policy Initiatives and Reforms in the MENA Region, Review poration, under the leadership of Imad Workshop--Governance Case Study of Fakhoury, selected APM Terminals to Jordanian Customs," draft paper, February manage Aqaba, but only after a rigorous 2004. and transparent selection process that 5. World Bank Group, Doing Business Jordan drew the attention of the leading world Country Profile, www.doingbusiness.org. container terminal operators. 54 Doing Business indicators DOING BUSINESS INDICATORS 55 Algeria Bahrain Comoros Djibouti Egypt Iraq Jordan Ease of doing business (Arab World rank) 14 2 19 18 11 17 10 Ease of doing business (global rank) 132 18 155 153 114 152 101 Starting a buSineSS (ARABWORLDRANK) 15 4 17 19 3 20 13 Procedures (number) 14 7 11 11 6 11 10 Time (days) 24 9 23 37 7 77 14 Cost (% of income per capita) 10.8 0.6 188.6 200.2 18.3 150.7 60.4 Min. capital (% of income per capita) 36.6 210.1 280.8 514.0 2.0 59.1 24.2 Dealing with licenSeS (ARABWORLDRANK) 13 1 6 10 20 12 7 Procedures (number) 22 13 18 14 28 14 18 Time (days) 240 56 164 195 249 215 122 Cost (% of income per capita) 46.8 57.2 77.9 982.8 376.7 915.0 443.7 eMPlOYing wOrkerS (ARABWORLDRANK) 14 2 19 17 11 8 6 Difficulty of Hiring Index 44 0 39 67 0 33 11 Rigidity of Hours Index 60 20 60 40 20 60 20 Difficulty of Firing Index 40 50 40 30 60 20 60 Rigidity of Employment 48 23 46 46 27 38 30 Firing costs (weeks of wages) 17 4 100 56 132 0 4 REgIstERIng pRopERty (ARABWORLD RANK) 20 3 15 19 14 6 17 Procedures (number) 14 2 5 7 7 5 8 Time (days) 51 31 24 40 72 8 22 Cost (% of property value) 7.5 0.9 20.8 13.2 0.9 6.5 10.0 gEttIng CREDIt (ARABWORLD RANK) 10 3 15 18 3 15 8 Strength of legal rights index (1­10) 3 4 3 1 3 3 4 Depth of credit information index (1­6) 2 4 0 1 5 0 2 Public registry coveage (% of adults) 0.2 0.0 0.0 0.2 2.2 0.0 1.0 Private bureau coverage (% of adults) 0.0 35.8 0.0 0.0 4.7 0.0 0.0 pRotECtIng InvEstoRs (ARABWORLD RANK) 5 4 14 20 5 10 10 Disclosure Index 6 8 6 5 8 4 5 Director Liability Index 6 4 1 2 3 5 4 Shareholder Suits Index 4 5 5 0 5 4 4 Investor Protection Index 5.3 5.7 4.0 2.3 5.3 4.3 4.3 pAyIng tAxEs (ARABWORLD RANK) 19 6 11 12 18 9 7 Payments (number) 34 25 20 35 29 13 26 Time (hours) 451 36 100 114 711 312 101 Total tax rate (% of profit) 74.2 15.0 48.8 38.7 46.1 24.7 31.1 tRADIng ACRoss BoRDERs (ARABWORLD RANK) 14 3 17 5 4 20 9 Documents for export (number) 8 5 10 5 6 10 7 Time for export (days) 17 14 30 19 14 102 19 Cost to export (US$ per container) 1,248 805 1,073 1,058 737 3,900 730 Documents for import (number) 9 6 10 5 6 10 7 Time for import (days) 23 15 21 16 15 101 22 Cost to import (US$ per container) 1,428 845 1,057 978 823 3,900 1,290 EnfoRCIng A ContRACt (ARABWORLD RANK) 11 8 17 19 18 16 12 Procedures (number) 47 48 43 40 42 51 39 Time (days) 630 635 506 1,225 1,010 520 689 Cost (% of debt) 21.9 14.7 89.4 34.0 26.2 32.5 31.2 ClosIng A BusInEss (ARABWORLD RANK) 4 1 20 14 13 20 11 Time (years) 2.5 2.5 NO PRACTICE 5.0 4.2 NO PRACTICE 4.3 Cost (% of estate) 7 10 NO PRACTICE 18 22 NO PRACTICE 9 Recovery rate (cents on the dollar) 41.7 63.2 0.0 15.9 16.8 0.0 27.3 56 DOING BUSINESS IN THE ARAB WORLD 2009 Kuwait lebanon Mauritania Morocco oman Qatar saudi Arabia Ease of doing business (Arab World rank) 5 9 20 12 6 3 1 Ease of doing business (global rank) 52 99 160 128 57 37 16 Starting a buSineSS (ARABWORLDRANK) 14 9 16 7 8 6 1 Procedures (number) 13 5 9 6 7 6 7 Time (days) 35 11 19 12 14 6 12 Cost (% of income per capita) 1.3 87.5 33.9 10.2 3.6 9.1 14.9 Min. capital (% of income per capita) 81.7 57.0 422.6 52.3 461.2 75.4 0.0 Dealing with licenSeS (ARABWORLDRANK) 8 14 18 9 16 2 5 Procedures (number) 25 20 25 19 16 19 18 Time (days) 104 211 201 163 242 76 125 Cost (% of income per capita) 171.4 217.8 475.0 292.5 721.4 0.8 74.7 eMPlOYing wOrkerS (ARABWORLDRANK) 3 7 16 20 1 10 4 Difficulty of Hiring Index 0 44 56 100 33 0 0 Rigidity of Hours Index 40 0 40 40 40 60 40 Difficulty of Firing Index 0 30 40 50 0 20 0 Rigidity of Employment 13 25 45 63 24 27 13 Firing costs (weeks of wages) 78 17 31 85 4 69 80 REgIstERIng pRopERty (ARABWORLD RANK) 13 16 10 18 4 8 1 Procedures (number) 8 8 4 8 2 10 2 Time (days) 55 25 49 47 16 16 2 Cost (% of property value) 0.5 5.9 5.2 4.9 3.0 0.3 0.0 gEttIng CREDIt (ARABWORLD RANK) 3 3 14 10 8 10 1 Strength of legal rights index (1­10) 4 3 3 3 4 3 4 Depth of credit information index (1­6) 4 5 1 2 2 2 6 Public registry coveage (% of adults) 0.0 6.8 0.2 2.4 23.4 .. 0.0 Private bureau coverage (% of adults) 31.2 0.0 0.0 0.0 0.0 0.0 14.1 pRotECtIng InvEstoRs (ARABWORLD RANK) 1 7 16 19 7 7 1 Disclosure Index 7 9 5 6 8 5 8 Director Liability Index 7 1 3 2 5 6 8 Shareholder Suits Index 5 5 3 1 2 4 3 Investor Protection Index 6.3 5.0 3.7 3.0 5.0 5.0 6.3 pAyIng tAxEs (ARABWORLD RANK) 5 10 20 16 4 1 3 Payments (number) 14 19 38 28 14 1 14 Time (hours) 118 180 696 358 62 36 79 Total tax rate (% of profit) 14.4 36.0 98.7 44.6 21.6 11.3 14.5 tRADIng ACRoss BoRDERs (ARABWORLD RANK) 12 10 19 8 15 6 2 Documents for export (number) 8 5 11 7 10 5 5 Time for export (days) 20 27 35 14 22 21 17 Cost to export (US$ per container) 995 872 1,520 700 821 735 681 Documents for import (number) 10 7 11 10 10 7 5 Time for import (days) 20 38 42 18 26 20 18 Cost to import (US$ per container) 1,152 1,073 1,523 1,000 1,037 657 678 EnfoRCIng A ContRACt (ARABWORLD RANK) 4 9 3 7 6 5 13 Procedures (number) 50 37 46 40 51 43 44 Time (days) 566 721 370 615 598 570 635 Cost (% of debt) 13.3 30.8 23.2 25.2 13.5 21.6 27.5 ClosIng A BusInEss (ARABWORLD RANK) 8 12 16 7 6 2 5 Time (years) 4.2 4.0 8.0 1.8 4.0 2.8 1.5 Cost (% of estate) 1 22 9 18 4 22 22 Recovery rate (cents on the dollar) 34.5 19.0 6.7 35.1 35.1 52.7 37.5 DOING BUSINESS INDICATORS 57 united Arab West Bank and sudan syria tunisia Emirates gaza yemen Ease of doing business (Arab World rank) 16 15 7 4 13 8 Ease of doing business (global rank) 147 137 73 46 131 98 Starting a buSineSS (ARABWORLDRANK) 10 12 2 11 18 5 Procedures (number) 10 8 10 8 11 7 Time (days) 39 17 11 17 49 13 Cost (% of income per capita) 50.8 18.2 7.9 13.4 69.1 93.0 Min. capital (% of income per capita) 0.0 4353.8 0.0 311.9 56.1 0.0 Dealing with licenSeS (ARABWORLDRANK) 17 15 11 4 19 3 Procedures (number) 19 26 20 21 21 13 Time (days) 271 128 84 125 199 107 Cost (% of income per capita) 240.3 697.0 1,017.8 1.5 1,399.9 189.7 eMPlOYing wOrkerS (ARABWORLDRANK) 18 15 13 5 12 9 Difficulty of Hiring Index 39 11 28 0 33 0 Rigidity of Hours Index 20 40 40 40 40 60 Difficulty of Firing Index 50 50 80 0 20 40 Rigidity of Employment 36 34 49 13 31 33 Firing costs (weeks of wages) 118 80 17 84 91 17 REgIstERIng pRopERty (ARABWORLD RANK) 5 11 9 2 12 7 Procedures (number) 6 4 4 3 7 6 Time (days) 9 19 39 6 63 19 Cost (% of property value) 3.1 28.0 6.1 2.0 0.9 3.8 gEttIng CREDIt (ARABWORLD RANK) 10 20 3 2 15 18 Strength of legal rights index (1­10) 5 1 3 4 0 2 Depth of credit information index (1­6) 0 0 5 5 3 0 Public registry coveage (% of adults) 0.0 0.0 14.9 6.5 7.8 0.1 Private bureau coverage (% of adults) 0.0 0.0 0.0 7.7 0.0 0.0 pRotECtIng InvEstoRs (ARABWORLD RANK) 18 10 16 10 3 14 Disclosure Index 0 6 0 4 6 6 Director Liability Index 6 5 5 7 5 4 Shareholder Suits Index 4 2 6 2 7 2 Investor Protection Index 3.3 4.3 3.7 4.3 6.0 4.0 pAyIng tAxEs (ARABWORLD RANK) 13 14 15 2 8 17 Payments (number) 42 20 22 14 27 44 Time (hours) 180 336 228 12 154 248 Total tax rate (% of profit) 31.6 43.5 59.1 14.4 16.8 47.8 tRADIng ACRoss BoRDERs (ARABWORLD RANK) 18 13 7 1 11 16 Documents for export (number) 6 8 5 5 6 6 Time for export (days) 35 15 17 10 25 31 Cost to export (US$ per container) 2,050 1,190 733 618 835 1,129 Documents for import (number) 6 9 7 7 6 9 Time for import (days) 49 21 23 10 40 28 Cost to import (US$ per container) 2,900 1,625 858 587 1,225 1,475 EnfoRCIng A ContRACt (ARABWORLD RANK) 14 20 2 15 10 1 Procedures (number) 53 55 39 50 44 37 Time (days) 810 872 565 607 700 520 Cost (% of debt) 19.8 29.3 21.8 26.3 21.2 16.5 ClosIng A BusInEss (ARABWORLD RANK) 20 9 3 15 20 10 Time (years) NO PRACTICE 4.1 1.3 5.1 NO PRACTICE 3.0 Cost (% of estate) NO PRACTICE 9 7 30 NO PRACTICE 8 Recovery rate (cents on the dollar) 0.0 29.5 52.3 10.2 0.0 28.6 Country tables Move data 0p7.5, ­0P3 COUNTRy TABLES 59 COUNTRY PROFILE Algeria Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) --49 -- 70 -- 112 --132 -- 118 -- -- --118 --126 131 141 Most di cult -- 162 -- 166 (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Bahrain algeria Ease of doing business (rank) 132 (AW 14) Ranking Middle East & North Africa NEW ST. VINCENT & UNITED SAUDI GNI per capita (US$) NEW HONG KONG 3,620 SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) Lower middle income -- Population (millions) 18 -- 14 -- 21 starting a business (rank) -- --141 -- 18 -- 15 --33.925 26(AW 15) protecting investors (rank) 70 (AW 5) Procedures (number) 49 14 Extent of disclosure index (0-10) -- 53 6 Time (days) 24 Extent of director liability index (0-10) -- 84 6 Cost (% of income per capita) 10.8 Ease of shareholder suits index (0-10) -- 113 4 Minimum capital (% of income per capita) 36.6 Strength of investor protection index (0-10) 5.3 Most di cult Dealing with construction permits (rank) 112 (AW 13) paying taxes (rank) 166 (AW 19) (181) ProceduresEase(number)Starting of a Dealing with Employing Registering 22 Getting PaymentsProtecting (number per year) Paying Trading Enforcing Closing a 34 Time (days)doing business construction workers property credit investors taxes across contracts business business permits 240 Time (hours per year) borders 451 Cost (% of income per capita) 46.8 Total tax rate (% of profit) 74.2 COUNTRY PROFILE Comoros Employing workers (rank) 118 (AW 14) trading across borders (rank) 118 (AW 14) Ranking DifficultySINGAPORE index (0-100) of hiring NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG ZEALAND THE GRENADINES STATES ARABIA 44 MALAYSIA DocumentsZEALAND to exportMALDIVES (number)SINGAPORE CHINA JAPAN 8 EASIEST (1) Rigidity of hours index (0-100) 60 Time to export (days) 17 Difficulty of firing index (0-100) 40 Cost to export (US$ per container) 1,248 Rigidity of employment index (0-100) 48 Documents to import (number) --55 9 Firing cost (weeks of salary) --64 17 Time to import (days) 23 -- 93 Cost to import (US$ per container) 1,428 Registering property (rank) 162 (AW 20) 126 Procedures (number) 14 Enforcing contracts (rank) -- -- 129 (AW 11) Time (days) --155 -- 160 51 Procedures (number) --150126 47 Most di cult --162 --163 Cost (181)of property value) (% 7.5 Time (days) --630181 Ease of Starting a Dealing with Employing Registering Getting Paying Trading Enforcing Closing a doing business construction workers property credit Cost (% ofProtecting investors claim) taxes across contracts business 21.9 getting credit (rank) business permits 131 (AW 10) borders COUNTRY PROFILE Strength of legal rights index (0-10) 3 Closing a business (rank) 49 (AW 4) Djibouti Depth of credit information index (0-6) 2 Time (years) 2.5 Ranking Public registry coverage (% of adults) 0.2 Cost (% of estate) 7 NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Private bureau coverage (% ofTHEadults) SINGAPORE ZEALAND GRENADINES STATES ARABIA 0.0 MALAYSIA Recovery rate (cents on the dollar) ZEALAND MALDIVES SINGAPORE CHINA JAPAN 41.7 --35 -- 61 -- 99 -- -- 134 --132 Most di cult -- 162 -- 166 (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a 60 DOING BUSINESS IN THE ARAB WORLD 2009 doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Bahrain Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) -- 18 -- 14 -- -- 18 -- 15 -- 21 -- 25 26 -- 49 -- 53 -- 84 -- 113 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Comoros Ranking bahrain Ease of doing business (rank) 18 (AW 2) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Middle East & North ZEALAND SINGAPORE Africa THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$)MALDIVES ZEALAND SINGAPORE CHINA JAPAN 25,731 High income Population (m) 0.8 starting a business (rank) 49 (AW 4) protecting investors (rank) --55 53 (AW 4) Procedures (number) --64 7 Extent of disclosure index (0-10) 8 Time (days) --993 Extent of director liability index (0-10) 4 Cost (% of income per capita) 0.6 Ease of shareholder suits index (0-10)129 126 5 Minimum capital (% of income per capita) -- -- --155 210.1 Strength of investor protection index (0-10) 5.7 -- 160 --150 Most di cult --162 --163 Dealing with construction permits (rank) (181) 14 (AW 1) paying taxes (rank) 15 (AW181 -- 6) Proceduresdoing Ease of (number)business Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a construction workers property 13 credit Paymentsinvestors (number per year) taxes across contracts business25 Time (days)business permits 56 Time (hours per year) borders 36 Cost (% of income per capita) 57.2 Total tax rate (% of profit) 15.0 COUNTRY PROFILE Djibouti Ranking Employing workers (rank) 26 (AW 2) trading across borders (rank) 21 (AW 3) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) DifficultySINGAPORE index (0-100) of hiring ZEALAND THE GRENADINES STATES ARABIA 0 MALAYSIA Documents to exportMALDIVES ZEALAND (number)SINGAPORE CHINA JAPAN 5 Rigidity of hours index (0-100) 20 Time to export (days) 14 Difficulty of firing index (0-100) 50 Cost to export (US$ per container) --35 805 Rigidity of employment index (0-100) 23 Documents to import (number) -- 6 61 Firing cost (weeks of salary) 4 Time to import (days) 15 -- 99 Cost to import (US$ per container) 845 Registering property (rank) 18 (AW 3)134 --132 Procedures (number) --153 -- 137 --2 Enforcing contracts (rank) -- 113 (AW 8) Most di cult Time (days) 173 31 -- Procedures (number) 172 159 48 Cost(181)ofEase -- --177 (% propertyStarting of value)a Dealing with Employing Registering 0.9 Getting Time (days) Protecting Paying Trading Enforcing Closing a 635 doing business construction workers property credit Cost (% ofinvestors claim) taxes across contracts business 14.7 getting credit (rank) business permits borders 84 (AW 3) COUNTRY PROFILE Strength of legal rights index (0-10) 4 Closing a business (rank) 25 (AW 1) Egypt Depth of credit information index (0-6) 4 Time (years) 2.5 Ranking Public registry coverage (% of ST. NEW adults) VINCENT & UNITED SAUDI 0.0 Cost (% of estate) NEW HONG KONG 10 EASIEST (1) Private bureau coverage (% ofTHEadults) SINGAPORE ZEALAND GRENADINES STATES ARABIA MALAYSIA 35.8 Recovery ZEALAND rate (centsMALDIVES dollar) SINGAPORE CHINA JAPAN on the 63.2 -- -- 24 41 --85 --84 --70 -- --107 114 -- 128 144 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRy TABLES 61 COUNTRY PROFILE Comoros Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) --64 --55 -- 93 -- 126 -- 129 --155 -- 160 --150 Most di cult --162 --163 (181) -- 181 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Djibouti cOMOrOS Ease of doing business (rank) 155 (AW 19) Ranking Sub-Saharan Africa NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$)MALDIVES ZEALAND SINGAPORE CHINA JAPAN 680 EASIEST (1) Low income Population (m) 0.6 starting a business (rank) 160 (AW 17) protecting investors (rank) --35 126 (AW 14) Procedures (number) 11 Extent of disclosure index (0-10) -- 61 6 Time (days) 23 Extent of director liability index (0-10) 1 Cost (% of income per capita) -- 99 188.6 Ease of shareholder suits index (0-10) 5 Minimum capital (% of income per capita) --153 -- 280.8 -- 134 Strength of investor protection index (0-10) --1324.0 137 -- Most di cult Dealing with construction173 -- 172 159 (181) -- permits (rank) 64 (AW 6) paying taxes (rank) --177 55 (AW 11) ProceduresEase of (number)Starting a Dealing with Employing Registering 18 Getting PaymentsProtecting (number per year) Paying Trading Enforcing Closing a20 Time (days)doing business construction workers property credit investors across contracts business business permits 164 Time (hours per year)taxes borders 100 Cost (% of income per capita) 77.9 Total tax rate (% of profit) 48.8 COUNTRY PROFILE Egypt Employing workers (rank) 162 (AW 19) trading across borders (rank) 129 (AW 17) Ranking DifficultySINGAPORE index (0-100) of hiring NEW ST. VINCENT & UNITED SAUDI HONG KONG ZEALAND THE GRENADINES STATES ARABIA 39 MALAYSIA DocumentsNEW exportMALDIVES ZEALAND to (number)SINGAPORE CHINA JAPAN 10 EASIEST (1) Rigidity of hours index (0-100) 60 Time to export (days) 30 Difficulty of firing index (0-100) 40 Cost to export (US$ per container) -- 24 1,073 Rigidity of employment index (0-100) -- 41 46 Documents to import (number) 10 Firing cost (weeks of salary) 100 --85 --84 Time to import 70 -- (days) 21 Cost to import (US$ per container) 1,057 -- 114 --93 107 (AW 15) Registering property (rank) 5 Enforcing contracts (rank) --144 150 (AW 17) -- 128 Procedures (number) 24 Procedures (number) --151 43 Most di cult --165 Time(181) (days) 20.8 Time (days) 506 Cost (% ofEase Registering Getting Protecting Paying Trading Enforcing Closing a doing propertyStarting of value)a Dealing with Employing business construction workers property credit Cost (% ofinvestors claim) taxes across contracts business 89.4 business permits 163 (AW 15) borders getting credit (rank) 3 Closing a business (rank) 181 (AW 20) Strength of legal rights index (0-10) 0 Time (years) No practice Depth of credit information index (0-6) 0 Cost (% of estate) No practice Public registry coverage (% of adults) 0.0 Recovery rate (cents on the dollar) 0.0 Private bureau coverage (% of adults) 0.0 -- -- 160 -- Most di cult --162 --163 (181) -- 181 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a 62 DOING BUSINESS IN THE ARAB WORLD 2009 doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Djibouti Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) --35 -- 61 -- 99 --153 -- -- 134 --132 137 -- Most di cult 173 -- 172 159 (181) -- --177 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Egypt Ranking DjibOuti Ease of doing business (rank) 153 (AW 18) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Middle East & North Africa SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA JAPAN 1,090 Lower middle income Population (m) -- 0.8 24 starting a business (rank)41-- 173 (AW 19) protecting investors (rank) 177 (AW 20) Procedures (number) -- --84 11 Extent of disclosure index (0-10) --70 5 Time (days) 37 85 Extent of director liability index (0-10) 2 Cost (% of income per capita) -- --107 114 200.2 Ease of shareholder suits index (0-10) --151 --2.3 0 Minimum capital (% of income per capita) 514.0 Strength of investor protection index (0-10) --144 128 Most di cult --165 Dealing with construction permits (rank) (181) 99 (AW 10) paying taxes (rank) 61 (AW 12) ProceduresEase Registering Getting Trading Enforcing Closing a doing (number)Starting of a Dealing with Employing business construction workers property 14 credit PaymentsProtecting perPaying investors (number taxes year) across contracts business 35 Time (days)business permits 195 Time (hours per year) borders 114 Cost (% of income per capita) 982.8 Total tax rate (% of profit) 38.7 Employing workers (rank) 137 (AW 17) trading across borders (rank) 35 (AW 5) Difficulty of hiring index (0-100) 67 Documents to export (number) 5 Rigidity of hours index (0-100) 40 Time to export (days) 19 Difficulty of firing index (0-100) 30 Cost to export (US$ per container) 1,058 Rigidity of employment index (0-100) 46 Documents to import (number) 5 Firing cost (weeks of salary) 56 Time to import (days) 16 Cost to import (US$ per container) 978 Registering property (rank) 134 (AW 19) Procedures (number) 7 Enforcing contracts (rank) 159 (AW 19) Time (days) 40 Procedures (number) 40 Cost (% of property value) 13.2 Time (days) 1,225 Cost (% of claim) 34.0 getting credit (rank) 172 (AW 18) Strength of legal rights index (0-10) 1 Closing a business (rank) 132 (AW 14) Depth of credit information index (0-6) 1 Time (years) 5.0 Public registry coverage (% of adults) 0.2 Cost (% of estate) 18 Private bureau coverage (% of adults) 0.0 Recovery rate (cents on the dollar) 15.9 --153 -- Most di cult 173 -- 172 159 (181) -- --177 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRy TABLES 63 COUNTRY PROFILE Egypt Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) -- -- 24 41 --85 --84 --70 -- --107 114 --144 -- 128 Most di cult --165 --151 (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders egYPt Ease of doing business (rank) 114 (AW 11) Middle East & North Africa GNI per capita (US$) 1,580 Lower middle income Population (m) 75.5 starting a business (rank) 41 (AW 3) protecting investors (rank) 70 (AW 5) Procedures (number) 6 Extent of disclosure index (0-10) 8 Time (days) 7 Extent of director liability index (0-10) 3 Cost (% of income per capita) 18.3 Ease of shareholder suits index (0-10) 5 Minimum capital (% of income per capita) 2.0 Strength of investor protection index (0-10) 5.3 Dealing with construction permits (rank) 165 (AW 20) paying taxes (rank) 144 (AW 18) Procedures (number) 28 Payments (number per year) 29 Time (days) 249 Time (hours per year) 711 Cost (% of income per capita) 376.7 Total tax rate (% of profit) 46.1 Employing workers (rank) 107 (AW 11) trading across borders (rank) 24 (AW 4) Difficulty of hiring index (0-100) 0 Documents to export (number) 6 Rigidity of hours index (0-100) 20 Time to export (days) 14 Difficulty of firing index (0-100) 60 Cost to export (US$ per container) 737 Rigidity of employment index (0-100) 27 Documents to import (number) 6 Firing cost (weeks of salary) 132 Time to import (days) 15 Cost to import (US$ per container) 823 Registering property (rank) 85 (AW 14) Procedures (number) 7 Enforcing contracts (rank) 151 (AW 18) Time (days) 72 Procedures (number) 42 Cost (% of property value) 0.9 Time (days) 1,010 Cost (% of claim) 26.2 getting credit (rank) 84 (AW 3) Strength of legal rights index (0-10) 3 Closing a business (rank) 128 (AW 13) Depth of credit information index (0-6) 5 Time (years) 4.2 Public registry coverage (% of adults) 2.2 Cost (% of estate) 22 Private bureau coverage (% of adults) 4.7 Recovery rate (cents on the dollar) 16.8 64 Move data 0p7.5, ­0P3 DOING BUSINESS IN THE ARAB WORLD 2009 COUNTRY PROFILE Iraq Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) -- 43 -- 43 -- 67 -- 111 -- 113 --152 --148 Most di cult 163 (181) -- -- 175 -- 178 --181 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Jordan Ranking iraQ Ease of doing business (rank) 152 (AW 17) Middle East & North Africa NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA JAPAN 1,224 EASIEST (1) Lower middle income Population (m) --22 28.5 starting a business (rank) --17552(AW 20) protecting investors (rank) 113 (AW 10) Procedures (number) -- 11 Extent of disclosure index (0-10) --74 4 Time (days) 74 77 Extent of director liability index (0-10) -- 93 5 Cost (% of income per capita) --101 150.7 115 Ease of shareholder suits index (0-10) 4 Minimum capital (% of income per capita) --131 -- 59.1 Strength of investor protection index (0-10) --123 --113 --128 4.3 Most di cult Dealing with construction permits (rank) (181) 111 (AW 12) paying taxes (rank) 43 (AW 9) ProceduresEase Registering Getting Trading Enforcing Closing a Time (days)doing (number)Starting of a Dealing with Employing business construction workers property 14 credit PaymentsProtecting perPaying investors (number taxes year) across contracts business 13 business permits 215 Time (hours per year) borders 312 Cost (% of income per capita) 915.0 Total tax rate (% of profit) 24.7 COUNTRY PROFILE Kuwait Ranking Employing workers (rank) 67 (AW 8) trading across borders (rank) 178 (AW 20) Difficulty SINGAPORE index (0-100)ST. of hiring NEW VINCENT & UNITED SAUDI NEW HONG KONG ZEALAND THE GRENADINES STATES ARABIA 33 MALAYSIA DocumentsZEALAND to exportMALDIVES (number) SINGAPORE CHINA JAPAN10 EASIEST (1) Rigidity of hours index (0-100) 60 Time to export (days) -- 9 102 Difficulty of firing index (0-100) -- --43 20 Cost to export (US$ per container) 24 3,900 Rigidity of employment index (0-100) --52 38 Documents to import (number) 10 66 Firing cost (weeks of salary) --82 --083 Time84 import (days) -- to --101 Cost to import (US$ per container) --104 --94 3,900 Registering property (rank) 43 (AW 6) Procedures (number) --134 5 Enforcing contracts (rank) 148 (AW 16) Most di cult Time (days) 8 Procedures (number) 51 Cost (% ofEase (181) property Starting of value) a Dealing with Employing Registering 6.5 Getting Time (days) Protecting Paying Trading Enforcing Closing a 520 doing business construction workers property credit Cost (% ofinvestors claim) taxes across contracts business 32.5 getting credit (rank) business permits 163 (AW 15) borders COUNTRY PROFILE Strength of legal rights index (0-10) 3 Closing a business (rank) 181 (AW 20) Lebanon Depth of credit information index (0-6) 0 Time (years) No practice Ranking Public registry coverage (% of adults) NEW ST. VINCENT & UNITED SAUDI 0.0 Cost (% of estate) NEW HONG KONGNo practice EASIEST (1) Private bureau coverage (% ofTHE SINGAPORE ZEALAND GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN adults) 0.0 Recovery rate (cents on the dollar) 0.0 --58 -- 45 --99 --98 --102 --84 --88 --83 --121 --118 --121 -- Most di cult -- 163 (181) -- 175 -- 178 --181 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRy TABLES 65 COUNTRY PROFILE Jordan Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) --22 -- 52 -- 74 --74 --101 -- 93 --131 --115 --123 --113 --128 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Kuwait Ranking jOrDan Ease of doing business (rank) 101 (AW 10) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Middle East & North Africa SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA JAPAN 2,850 Lower middle income Population (m) -- -- 9 5.7 24 starting a business (rank) --52 --131 43(AW 13) protecting investors (rank) 113 (AW 10) Procedures (number) -- -- 10 83 Extent of disclosure index (0-10) --665 Time (days) --82 14 Extent84of director liability index (0-10) --94 4 Cost (% of income per capita) 60.4 Ease of shareholder suits index (0-10) 104 -- 4 Minimum capital (% of income per capita) --134 24.2 Strength of investor protection index (0-10) 4.3 Most di cult Dealing with construction permits (rank) (181) 74 (AW 7) paying taxes (rank) 22 (AW 7) ProceduresEase Registering Getting Trading Enforcing Closing a doing (number)Starting of a Dealing with Employing business construction workers property 18 credit PaymentsProtecting perPaying investors (number taxes year) across contracts business 26 Time (days)business permits 122 Time (hours per year) borders 101 COUNTRY PROFILE Cost (% of income per capita) 443.7 Total tax rate (% of profit) 31.1 Lebanon Ranking Employing workers (rank) 52 (AW 6) trading across borders (rank) 74 (AW 9) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Difficulty SINGAPORE index (0-100) of hiring ZEALAND THE GRENADINES STATES ARABIA 11 MALAYSIA DocumentsZEALAND to exportMALDIVES (number) SINGAPORE CHINA JAPAN 7 Rigidity of hours index (0-100) 20 Time to export (days) 19 Difficulty of firing index (0-100) 60 Cost to export (US$ per container) 45 730 Rigidity of employment index (0-100) --58 30 Documents to import (number) -- 7 Firing cost (weeks of salary) 4 Time84to import (days) 22 --99 --98 --102 -- --88 --83 Cost to import (US$ per container) 1,290 Registering property (rank) --121 115 (AW 17) --118 --121 Procedures (number) 8 Enforcing contracts (rank) 128 (AW 12) Most di cult Time (days) 22 Procedures (number) 39 Cost (% ofEase (181) property Starting of value) a Dealing with Employing Registering 10.0 Getting Time (days) Protecting Paying Trading Enforcing Closing a 689 doing business construction workers property credit business 31.2 business Cost (% ofinvestors claim) taxes across contracts permits borders getting credit (rank) 123 (AW 8) COUNTRY PROFILE Strength of legal rights index (0-10) 4 Closing a business (rank) 93 (AW 11) Mauritania Depth of credit information index (0-6) 2 Time (years) 4.3 Ranking Public registry coverage (% ofTHE NEW adults) ST. VINCENT & UNITED SAUDI 1.0 estate) NEW HONG KONG 9 SINGAPORE ZEALAND GRENADINES STATES ARABIA MALAYSIA Cost (% ofZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) Private bureau coverage (% of adults) 0.0 Recovery rate (cents on the dollar) 27.3 --61 --84 --123 -- -- -- --142 148 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a 66 DOING BUSINESS IN THE ARAB WORLD 2009 doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Kuwait Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) -- -- 9 24 --52 --43 --82 --83 --66 -- 84 --104 --94 --134 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Lebanon Ranking kuwait Ease of doing business (rank) 52 (AW 5) Middle East & North Africa NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA 31,640 JAPAN EASIEST (1) High income Population (m) 2.7 starting a business (rank) (AW 14) protecting investors (rank)45 -- 24 (AW 1) 58 Procedures (number) --134 13 Extent of disclosure index (0-10) 7 Time (days) --99 --98 --83 --102 35 Extent of director liability index (0-10) --84 --88 7 Cost (% of income per capita) --121 1.3 Ease of shareholder suits index (0-10) --118 121 5 Minimum capital (% of income per capita) 81.7 Strength of investor protection index (0-10) --6.3 Most di cult Dealing with construction permits (rank) (181) 82 (AW 8) paying taxes (rank) 9 (AW 5) ProceduresEase Registering Getting Trading Enforcing Closing a doing (number)Starting of a Dealing with Employing business construction workers property 25 credit PaymentsProtecting perPaying investors (number taxes year) across contracts business 14 Time (days)business permits 104 Time (hours per year) borders 118 Cost (% of income per capita) 171.4 Total tax rate (% of profit) 14.4 COUNTRY PROFILE Mauritania Ranking Employing workers (rank) 43 (AW 3) trading across borders (rank) 104 (AW 12) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Difficulty SINGAPORE index (0-100) of hiring ZEALAND THE GRENADINES STATES ARABIA 0 MALAYSIA DocumentsZEALAND to exportMALDIVES (number) SINGAPORE CHINA JAPAN 8 Rigidity of hours index (0-100) 40 Time to export (days) 20 Difficulty of firing index (0-100) 0 Cost to export (US$ per container) 995 Rigidity of employment index (0-100) --61 13 Documents to import (number) 10 Firing cost (weeks of salary) 78 Time to import (days) --84 20 Cost to import (US$ per container) 1,152 Registering property (rank) --83 123 (AW 13) Procedures (number) --160 --143 --142 8 Enforcing contracts (rank) --145 --142 -- 94 (AW 148 --4) 158 Most di cult Time (days) 55 Procedures (number) --174 50 Cost (% ofEase (181) property Starting of value) a Dealing with Employing Registering 0.5 Getting Time (days) Protecting Paying Trading Enforcing Closing a 566 doing business construction workers property credit Cost (% ofinvestors claim) taxes across contracts business 13.3 getting credit (rank) business permits 84 (AW 3) borders Strength of legal rights index (0-10) 4 Closing a business (rank) 66 (AW 8) Depth of credit information index (0-6) 4 Time (years) 4.2 Public registry coverage (% of adults) 0.0 Cost (% of estate) 1 Private bureau coverage (% of adults) 31.2 Recovery rate (cents on the dollar) 34.5 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRy TABLES 67 COUNTRY PROFILE Lebanon Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) --58 -- 45 --99 --98 --102 --84 --88 --83 --121 --118 --121 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Mauritania Ranking lebanOn Ease of doing business (rank) 99 (AW 9) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Middle East & North Africa SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA JAPAN 5,770 Upper middle income Population (m) 4.1 starting a business (rank) 98 (AW 9) protecting investors (rank) 88 (AW 7) 61 Procedures (number) --5 Extent of disclosure index (0-10) 9 Time (days) 11 Extent of director liability index (0-10) --84 1 Cost (% of income per capita) --123 87.5 Ease of shareholder suits index (0-10) 5 Minimum capital (% of income per capita) --160 --143 --142 57.0 Strength of investor protection index (0-10) --145 --142 -- --5.0 148 158 Most di cult Dealing with construction permits (rank) (181) 121 (AW 14) paying taxes (rank) --174 45 (AW 10) ProceduresEase Registering Getting Trading Enforcing Closing a doing (number)Starting of a Dealing with Employing business construction workers property 20 credit PaymentsProtecting perPaying investors (number taxes year) across contracts business 19 Time (days)business permits 211 Time (hours per year) borders 180 Cost (% of income per capita) 217.8 Total tax rate (% of profit) 36.0 Employing workers (rank) 58 (AW 7) trading across borders (rank) 83 (AW 10) Difficulty of hiring index (0-100) 44 Documents to export (number) 5 Rigidity of hours index (0-100) 0 Time to export (days) 27 Difficulty of firing index (0-100) 30 Cost to export (US$ per container) 872 Rigidity of employment index (0-100) 25 Documents to import (number) 7 Firing cost (weeks of salary) 17 Time to import (days) 38 Cost to import (US$ per container) 1,073 Registering property (rank) 102 (AW 16) Procedures (number) 8 Enforcing contracts (rank) 118 (AW 9) Time (days) 25 Procedures (number) 37 Cost (% of property value) 5.9 Time (days) 721 Cost (% of claim) 30.8 getting credit (rank) 84 (AW 3) Strength of legal rights index (0-10) 3 Closing a business (rank) 121 (AW 12) Depth of credit information index (0-6) 5 Time (years) 4.0 Public registry coverage (% of adults) 6.8 Cost (% of estate) 22 Private bureau coverage (% of adults) 0.0 Recovery rate (cents on the dollar) 19.0 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a 68 DOING BUSINESS IN THE ARAB WORLD 2009 doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Mauritania Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) --61 --84 --123 --160 --143 --142 --145 --142 -- --148 158 Most di cult (181) --174 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders Mauritania Ease of doing business (rank) 160 (AW 20) Sub-Saharan Africa GNI per capita (US$) 840 Low income Population (m) 3.1 starting a business (rank) 143 (AW 16) protecting investors (rank) 142 (AW 16) Procedures (number) 9 Extent of disclosure index (0-10) 5 Time (days) 19 Extent of director liability index (0-10) 3 Cost (% of income per capita) 33.9 Ease of shareholder suits index (0-10) 3 Minimum capital (% of income per capita) 422.6 Strength of investor protection index (0-10) 3.7 Dealing with construction permits (rank) 142 (AW 18) paying taxes (rank) 174 (AW 20) Procedures (number) 25 Payments (number per year) 38 Time (days) 201 Time (hours per year) 696 Cost (% of income per capita) 475.0 Total tax rate (% of profit) 98.7 Employing workers (rank) 123 (AW 16) trading across borders (rank) 158 (AW 19) Difficulty of hiring index (0-100) 56 Documents to export (number) 11 Rigidity of hours index (0-100) 40 Time to export (days) 35 Difficulty of firing index (0-100) 40 Cost to export (US$ per container) 1,520 Rigidity of employment index (0-100) 45 Documents to import (number) 11 Firing cost (weeks of salary) 31 Time to import (days) 42 Cost to import (US$ per container) 1,523 Registering property (rank) 61 (AW 10) Procedures (number) 4 Enforcing contracts (rank) 84 (AW 3) Time (days) 49 Procedures (number) 46 Cost (% of property value) 5.2 Time (days) 370 Cost (% of claim) 23.2 getting credit (rank) 145 (AW 14) Strength of legal rights index (0-10) 3 Closing a business (rank) 148 (AW 16) Depth of credit information index (0-6) 1 Time (years) 8.0 Public registry coverage (% of adults) 0.2 Cost (% of estate) 9 Private bureau coverage (% of adults) 0.0 Recovery rate (cents on the dollar) 6.7 Move data 0p7.5, ­0P3 COUNTRy TABLES 69 COUNTRY PROFILE Morocco Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) -- 62 -- 64 --64 -- 90 --128 --117 -- 131 --119 --112 Most di cult --168 --164 (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Oman Ranking MOrOccO Ease of doing business (rank) 128 (AW 12) Middle East & North AfricaNEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA JAPAN 2,250 EASIEST (1) Lower middle income -- -- -- 8 19 Population (m) 30.9 starting a business (rank) 24 --57 62 (AW 7) protecting investors (rank) 164 (AW 19) Procedures (number) -- 76 6 Extent of disclosure index (0-10) --636 Time (days) 12 Extent of director88liability index (0-10) -- 2 Cost (% of income per capita) 10.2 Ease of shareholder suits index (0-10) --123 --119 --105 1 Minimum capital (% of income per capita) --133 52.3 Strength of investor protection index (0-10) 3.0 Most di cult Dealing with construction permits (rank) (181) 90 (AW 9) paying taxes (rank) 119 (AW 16) ProceduresEase Registering Getting Trading Enforcing Closing a Time (days)doing (number)Starting of a Dealing with Employing business construction workers property 19 credit PaymentsProtecting perPaying investors (number taxes year) across contracts business 28 business permits 163 Time (hours per year) borders 358 Cost (% of income per capita) 292.5 Total tax rate (% of profit) 44.6 COUNTRY PROFILE Qatar Ranking Employing workers (rank) 168 (AW 20) trading across borders (rank) 64 (AW 8) Difficulty SINGAPORE index (0-100)ST. of hiring NEW VINCENT & UNITED SAUDI NEW HONG KONG ZEALAND THE GRENADINES STATES ARABIA 100 MALAYSIA DocumentsZEALAND (number) SINGAPORE CHINA JAPAN 7 EASIEST (1) to exportMALDIVES2 Rigidity of hours index (0-100) 40 Time to export (days) -- 14 Difficulty of firing index (0-100) --37 --27 50 Cost to export (US$ per container) -- 36 --70031 Rigidity of employment index (0-100) --57 --63 54 Documents to import (number) 10 Firing cost (weeks of salary) --88 85 Time to import (days) --88 18 Cost to import (US$ per container) --98 1,000 Registering property (rank) 117 (AW 18) --131 Procedures (number) 8 Enforcing contracts (rank) 112 (AW 7) Most di cult Time (days) 47 Procedures (number) 40 Cost (% ofEase (181) property Starting of value) a Dealing with Employing Registering 4.9 Getting Time (days) Protecting Paying Trading Enforcing Closing a 615 doing business construction workers property credit Cost (% ofinvestors claim) taxes across contracts business 25.2 getting credit (rank) business permits 131 (AW 10) borders COUNTRY PROFILE Strength of legal rights index (0-10) 3 Closing a business (rank) 64 (AW 7) Saudi Arabia Depth of credit information index (0-6) 2 Time (years) 1.8 Ranking Public registry coverage (% of adults) NEW ST. VINCENT & UNITED SAUDI 2.4 Cost (% of estate) NEW HONG KONG 18 SINGAPORE ZEALAND EASIEST (1) Private bureau 16 --coverage (% ofTHE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN adults) -- 0.0 1 Recovery rate (cents on the dollar) --28 --24 --7 35.1 -- 16 --50 --45 -- 59 --57 --137 Most di cult --168 --164 (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a 70 DOING BUSINESS IN THE ARAB WORLD 2009 doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Oman Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) -- -- -- 8 19 24 --57 -- --63 76 -- 88 --133 --123 --119 --105 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Qatar Ranking OMan Ease of doing business (rank) 57 (AW 6) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Middle East & North Africa SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA -- 11,120 JAPAN 2 High income --27 Population (m) 36 --2.631 starting a business (rank) --37 --57 76 (AW 9) -- 54 protecting investors (rank) -- 88 (AW 7) Procedures (number) 7 Extent of disclosure index (0-10) 8 Time (days) --88 14 Extent of director liability index (0-10) --88 --98 5 Cost (% of income per capita) 3.6 Ease of shareholder suits index (0-10) 2 Minimum capital (% of income per capita) 461.2 Strength of investor protection index (0-10) --131 5.0 Most di cult Dealing with construction permits (rank) (181) 133 (AW 16) paying taxes (rank) 8 (AW 4) ProceduresEase Registering Getting Trading Enforcing Closing a doing (number)Starting of a Dealing with Employing business construction workers property 16 credit PaymentsProtecting perPaying investors (number taxes year) across contracts business 14 Time (days)business permits 242 Time (hours per year) borders 62 COUNTRY PROFILE Cost (% of income per capita) 721.4 Total tax rate (% of profit) 21.6 Saudi Arabia Ranking Employing workers (rank) 24 (AW 1) trading across borders (rank) 119 (AW 15) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Difficulty SINGAPORE index (0-100) of hiring ZEALAND THE GRENADINES STATES ARABIA -- 33 MALAYSIA 1 DocumentsZEALAND to exportMALDIVES (number) SINGAPORE CHINA JAPAN10 Rigidity of hours index (0-100) --16 40 Time to export (days) --7 -- 16 22 Difficulty of firing index (0-100) --28 --24 --45 0 Cost to export (US$ per container) 821 Rigidity of employment index (0-100)50 -- 24 Documents to import (number) -- 59 --5710 Firing cost (weeks of salary) 4 Time to import (days) 26 Cost to import (US$ per container) 1,037 Registering property (rank) 19 (AW 4) Procedures (number) 2 Enforcing contracts (rank) --137105 (AW 6) Most di cult Time (days) 16 Procedures (number) 51 Cost (% ofEase (181) property Starting of value) a Dealing with Employing Registering 3.0 Getting Time (days) Protecting Paying Trading Enforcing Closing a 598 doing business construction workers property credit business 13.5 business Cost (% ofinvestors claim) taxes across contracts permits borders getting credit (rank) 123 (AW 8) COUNTRY PROFILE Strength of legal rights index (0-10) 4 Closing a business (rank) 63 (AW 6) Sudan Depth of credit information index (0-6) 2 Time (years) 4.0 Ranking Public registry coverage (% ofTHE NEW adults) ST. VINCENT & UNITED 23.4 SAUDI estate) NEW HONG KONG 4 SINGAPORE ZEALAND GRENADINES STATES ARABIA MALAYSIA Cost (% ofZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) Private bureau coverage (% of adults) 0.0 Recovery rate (cents on the dollar) 35.1 -- 35 -- 67 --107 --135 -- --131 144 --139 --143 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRy TABLES 71 COUNTRY PROFILE Qatar Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) -- 2 --37 --27 36 --31 --57 -- -- 54 --88 --88 --98 --131 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Saudi Arabia Ranking Qatar Ease of doing business (rank) 37 (AW 3) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Middle East & North Africa SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA -- 1 GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA 72,849 JAPAN High income --16 --28 Population (m) --24 --7 -- 16 0.8 starting a business (rank) --50 --4557 (AW 6) protecting investors (rank) -- 88 (AW577) -- Procedures (number) 6 Extent of disclosure index (0-10) 59 5 Time (days) 6 Extent of director liability index (0-10) 6 Cost (% of income per capita) 9.1 Ease of shareholder suits index (0-10) 4 Minimum capital (% of income per capita) 75.4 Strength of investor protection index (0-10) --137 5.0 Most di cult Dealing with construction permits (rank) (181) 27 (AW 2) paying taxes (rank) 2 (AW 1) ProceduresEase Registering Getting Trading Enforcing Closing a doing (number)Starting of a Dealing with Employing business construction workers property 19 credit PaymentsProtecting perPaying investors (number taxes year) across contracts business1 Time (days)business permits 76 Time (hours per year) borders 36 COUNTRY PROFILE Cost (% of income per capita) 0.8 Total tax rate (% of profit) 11.3 Sudan Ranking Employing workers (rank) 10) trading across borders (rank) 36 (AW 6) NEW ST. VINCENT & UNITED 88 (AWSAUDI NEW HONG KONG EASIEST (1) Difficulty SINGAPORE index (0-100) of hiring ZEALAND THE GRENADINES STATES ARABIA 0 MALAYSIA DocumentsZEALAND to exportMALDIVES (number) SINGAPORE CHINA JAPAN 5 Rigidity of hours index (0-100) 60 Time to export (days) 21 Difficulty of firing index (0-100) -- 20 35 Cost to export (US$ per container) 735 Rigidity of employment index (0-100) 27 Documents to import (number) -- 67 7 Firing cost (weeks of salary) 69 Time to import (days) 20 --107 Cost to import (US$ per container) 657 Registering property (rank) 54 (AW 8) --131 Procedures (number) --147 --135 -- 144 10 Enforcing contracts (rank) --150 --139 --143 98 (AW 5) Most di cult Time (days) 16 Procedures (number) --57043 181 Cost (% ofEase (181) property Starting of value) a Dealing with Employing Registering 0.3 Getting Time (days) Protecting Paying Trading Enforcing Closing a doing business construction workers property credit Cost (% ofinvestors claim) taxes across contracts business 21.6 getting credit (rank) business permits borders 131 (AW 10) Strength of legal rights index (0-10) 3 Closing a business (rank) 31 (AW 2) Depth of credit information index (0-6) 2 Time (years) 2.8 Public registry coverage (% of adults) .. Cost (% of estate) 22 Private bureau coverage (% of adults) 0.0 Recovery rate (cents on the dollar) 52.7 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a 72 DOING BUSINESS IN THE ARAB WORLD 2009 doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Saudi Arabia Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) --16 -- 1 --28 --24 --7 -- 16 --50 --45 -- 59 --57 --137 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Sudan Ranking SauDi arabia Ease of doing business (rank) 16 (AW 1) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Middle East & North Africa SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA 15,440 JAPAN High income Population (m) 24.2 35 starting a business (rank) 28 (AW 1) -- protecting investors (rank) 24 (AW 1) Procedures (number) 7 Extent of disclosure index (0-10) -- 67 8 Time (days) 12 Extent of director liability index (0-10) 8 Cost (% of income per capita) --107 14.9 Ease131shareholder suits index (0-10) of 3 Minimum capital (% of income per capita) --147 --135 -- -- 144 0.0 Strength of investor protection index (0-10) --150 --139 --143 6.3 Most di cult Dealing with construction permits (rank) (181) 50 (AW 5) paying taxes (rank) 7 (AW 3) --181 ProceduresEase Registering Getting Trading Enforcing Closing a doing (number)Starting of a Dealing with Employing business construction workers property 18 credit PaymentsProtecting perPaying investors (number taxes year) across contracts business 14 Time (days)business permits 125 Time (hours per year) borders 79 Cost (% of income per capita) 74.7 Total tax rate (% of profit) 14.5 Employing workers (rank) 45 (AW 4) trading across borders (rank) 16 (AW 2) Difficulty of hiring index (0-100) 0 Documents to export (number) 5 Rigidity of hours index (0-100) 40 Time to export (days) 17 Difficulty of firing index (0-100) 0 Cost to export (US$ per container) 681 Rigidity of employment index (0-100) 13 Documents to import (number) 5 Firing cost (weeks of salary) 80 Time to import (days) 18 Cost to import (US$ per container) 678 Registering property (rank) 1 (AW 1) Procedures (number) 2 Enforcing contracts (rank) 137 (AW 13) Time (days) 2 Procedures (number) 44 Cost (% of property value) 0.0 Time (days) 635 Cost (% of claim) 27.5 getting credit (rank) 59 (AW 1) Strength of legal rights index (0-10) 4 Closing a business (rank) 57 (AW 5) Depth of credit information index (0-6) 6 Time (years) 1.5 Public registry coverage (% of adults) 0.0 Cost (% of estate) 22 Private bureau coverage (% of adults) 14.1 Recovery rate (cents on the dollar) 37.5 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts COUNTRy TABLES business 73 business permits borders COUNTRY PROFILE Sudan Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) -- 35 -- 67 --107 --147 --135 -- --131 144 --150 --139 --143 Most di cult (181) --181 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders SuDan Ease of doing business (rank) 147 (AW 16) Sub-Saharan Africa GNI per capita (US$) 960 Lower middle income Population (m) 38.6 starting a business (rank) 107 (AW 10) protecting investors (rank) 150 (AW 18) Procedures (number) 10 Extent of disclosure index (0-10) 0 Time (days) 39 Extent of director liability index (0-10) 6 Cost (% of income per capita) 50.8 Ease of shareholder suits index (0-10) 4 Minimum capital (% of income per capita) 0.0 Strength of investor protection index (0-10) 3.3 Dealing with construction permits (rank) 135 (AW 17) paying taxes (rank) 67 (AW 13) Procedures (number) 19 Payments (number per year) 42 Time (days) 271 Time (hours per year) 180 Cost (% of income per capita) 240.3 Total tax rate (% of profit) 31.6 Employing workers (rank) 144 (AW 18) trading across borders (rank) 139 (AW 18) Difficulty of hiring index (0-100) 39 Documents to export (number) 6 Rigidity of hours index (0-100) 20 Time to export (days) 35 Difficulty of firing index (0-100) 50 Cost to export (US$ per container) 2,050 Rigidity of employment index (0-100) 36 Documents to import (number) 6 Firing cost (weeks of salary) 118 Time to import (days) 49 Cost to import (US$ per container) 2,900 Registering property (rank) 35 (AW 5) Procedures (number) 6 Enforcing contracts (rank) 143 (AW 14) Time (days) 9 Procedures (number) 53 Cost (% of property value) 3.1 Time (days) 810 Cost (% of claim) 19.8 getting credit (rank) 131 (AW 10) Strength of legal rights index (0-10) 5 Closing a business (rank) 181 (AW 20) Depth of credit information index (0-6) 0 Time (years) No practice Public registry coverage (% of adults) 0.0 Cost (% of estate) No practice Private bureau coverage (% of adults) 0.0 Recovery rate (cents on the dollar) 0.0 74 Move data 0p7.5, ­0P3 DOING BUSINESS IN THE ARAB WORLD 2009 COUNTRY PROFILE Syria Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) -- 71 --113 --99 -- 84 --137 --124 --111 --132 --122 Most di cult (181) -- 178 -- 174 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Tunisia Ranking SYria Ease of doing business (rank) 137 (AW 15) Middle East & North Africa NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA JAPAN 1,760 EASIEST (1) Lower middle income Population (m) 32 starting a business (rank) --37 124 (AW 12) protecting investors (rank) --38 113 (AW 10) --19.9 Procedures (number) --73 --8 55 Extent84of disclosure index (0-10) --72 6 Time (days) 17 Extent of director liability index (0-10) 5 Cost (% of income per capita) --101 -- --113 18.2 Ease of shareholder suits index (0-10) --106 2 Minimum capital (% of income per capita) 4353.8 Strength of investor protection index (0-10) --142 4.3 Most di cult Dealing with construction permits (rank) (181) 132 (AW 15) paying taxes (rank) 99 (AW 14) ProceduresEase Registering Getting Trading Enforcing Closing a Time (days)doing (number)Starting of a Dealing with Employing business construction workers property 26 PaymentsProtecting perPaying credit investors (number taxes year) across contracts business 20 business permits 128 Time (hours per year) borders 336 Cost (% of income per capita) 697.0 Total tax rate (% of profit) 43.5 COUNTRY PROFILE United Arab Emirates Ranking Employing workers (rank) 122 (AW 15) trading across borders (rank) 111 (AW 13) Difficulty of hiring index (0-100)ST. NEW VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA 11 MALAYSIA DocumentsZEALAND to exportMALDIVES (number) SINGAPORE CHINA JAPAN 8 EASIEST (1) Rigidity of hours index (0-100) --11 40 Time to export (days) --4 -- 14 15 Difficulty of firing index (0-100) --41 50 Cost to export (US$ per container) 1,190 Rigidity of employment index (0-100) --46 --47 34 Documents to import (number) 9 68 Firing cost (weeks of salary) 80 Time to import (days) -- 21 Cost to import (US$ per container) 1,625 Registering property (rank) --113 71 (AW 11) --113 Procedures (number) 4 Enforcing contracts (rank) --145 174 (AW 20) --141 Most di cult Time (days) 19 Procedures (number) 55 Cost (% ofEase (181) property value) of Starting a Dealing with Employing Registering 28.0 Getting Time (days) Protecting Paying Trading Enforcing Closing a 872 doing business construction workers property Cost (% ofinvestors credit claim) taxes across contracts business 29.3 getting credit (rank) business permits 178 (AW 20) borders Strength of legal rights index (0-10) COUNTRY PROFILE 1 Closing a business (rank) 84 (AW 9) West Bank and Gaza Depth of credit information index (0-6) 0 Time (years) 4.1 Ranking Public registry coverageNEW(% of adults) ST. VINCENT & UNITED SAUDI 0.0 Cost (% of estate) NEW HONG KONG 9 EASIEST (1) Private bureau coverage (% ofTHE SINGAPORE ZEALAND GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN adults) 0.0 Recovery rate (cents on the dollar) 29.5 --38 -- 25 -- 80 -- 85 --109 --131 --122 Most di cult (181) -- 178 -- 174 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts COUNTRy TABLES business business permits borders 75 COUNTRY PROFILE Tunisia Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) --37 -- --38 --32 55 --73 --101 -- 84 --72 --113 --106 --142 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE United Arab Emirates Ranking tuniSia Ease of doing business (rank) 73 (AW 7) Middle East & North Africa NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA JAPAN 3,200 EASIEST (1) Lower middle income --11 Population (millions) --4 -- 14 10.2 starting a business (rank) --46 --41 --47 37 (AW 2) protecting investors (rank) 142 (AW 16) Procedures (number) 10 Extent of disclosure index (0-10) -- 68 0 Time (days) 11 Extent of director liability index (0-10) 5 Cost (% of income per capita) --113 7.9 Ease of shareholder suits index (0-10) --113 6 Minimum capital (% of income per capita) 0.0 Strength of investor protection index (0-10) --145 --3.7141 Most di cult Dealing with construction permits (rank) (181) 101 (AW 11) paying taxes (rank) 106 (AW 15) ProceduresEase Registering Getting (number Paying Trading Enforcing Closing a Time (days)doing (number)Starting of a Dealing with Employing business construction workers property 20 credit PaymentsProtecting pertaxes investors year) across contracts business 22 business permits 84 Time (hours per year) borders 228 Cost (% of income per capita) 1,017.8 Total tax rate (% of profit) 59.1 COUNTRY PROFILE West Bank and Gaza Ranking Employing workers (rank) 113 (AWSAUDI 13) trading across borders (rank) 38 (AW 7) DifficultySINGAPORE index (0-100) NEW ST. VINCENT & UNITED NEW HONG KONG of hiring ZEALAND THE GRENADINES STATES ARABIA 28 MALAYSIA DocumentsZEALAND to exportMALDIVES (number)SINGAPORE CHINA JAPAN 5 EASIEST (1) Rigidity of hours index (0-100) 40 Time to export (days) 17 Difficulty of firing index (0-100) 80 Cost to export (US$ per container) --38 -- 25 733 Rigidity of employment index (0-100) 49 Documents to import (number) 7 Firing cost (weeks of salary) -- 17 80 Time to import (days) -- 85 23 Cost to import (US$ per container) 858 Registering property (rank) --131 --10955 (AW 9) --122 Procedures (number) 4 Enforcing contracts (rank) 72 (AW 2) Most di cult Time (days) --166 --149 39 Procedures (number) --163 --56539 Cost (181)ofEase (% propertyStarting 181 of value)a Dealing with Employing Registering 6.1 Getting Time (days) Protecting Paying Trading Enforcing Closing a doing business construction workers property credit Cost (% ofinvestors claim) taxes across contracts business 21.8 getting credit (rank) business permits 84 (AW 3) borders COUNTRY PROFILE Strength of legal rights index (0-10) 3 Closing a business (rank) 32 (AW 3) Yemen Depth of credit information index (0-6) 5 Time (years) 1.3 Ranking Public registry coverage (% of adults) NEW ST. VINCENT & UNITED SAUDI 14.9 Cost (% of estate) NEW HONG KONG 7 EASIEST (1) Private bureau coverage (% ofTHEadults) SINGAPORE ZEALAND GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN 0.0 Recovery rate (cents on the dollar) 52.3 --50 --33 --48 --41 --69 --98 --87 --126 --138 --126 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a 76 DOING BUSINESS IN THE ARAB WORLD 2009 doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE United Arab Emirates Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) --11 --4 -- 14 --46 --41 --47 -- 68 --113 --113 --145 --141 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE West Bank and Gaza Ranking uniteD arab eMirateS Ease of doing business (rank) 46 (AW 4) Middle East & North Africa NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA JAPAN 26,210 EASIEST (1) High income Population (m) -- 4.4 25 starting a business (rank) 113 (AW 11) protecting investors (rank) --38 113 (AW 10) Procedures (number) Extent of disclosure index (0-10) 4 Time (days) --880 17 Extent of director liability index (0-10)85 -- 7 Cost (% of income per capita) --109 13.4 Ease of shareholder suits index (0-10) --122 2 Minimum capital (% of income per capita) --131 311.9 Strength of investor protection index (0-10) 4.3 Most di cult --163 Dealing with construction permits (rank) --166 --149 (181) 41 (AW 4) paying taxes (rank) 4 (AW181 -- 2) ProceduresEase Registering Getting (number Paying Trading Enforcing Closing a doing (number)Starting of a Dealing with Employing business construction workers property 21 credit PaymentsProtecting pertaxes investors year) across contracts business14 Time (days)business permits 125 Time (hours per year) borders 12 Cost (% of income per capita) 1.5 Total tax rate (% of profit) 14.4 COUNTRY PROFILE Yemen Ranking Employing workers (rank) 47 (AW 5) trading across borders (rank) 14 (AW 1) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) DifficultySINGAPORE index (0-100) of hiring ZEALAND THE GRENADINES STATES ARABIA 0 MALAYSIA DocumentsZEALAND to exportMALDIVES (number)SINGAPORE CHINA JAPAN 5 Rigidity of hours index (0-100) 40 Time to export (days) 10 Difficulty of firing index (0-100) Cost to export (US$ per container) --41 618 Rigidity of employment index (0-100) --50 --33 --048 13 Documents to import (number) 7 Firing cost (weeks of salary) --69 84 Time to import (days) 10 --98 87 Cost to import (US$ per container) --587 Registering property (rank) 11 (AW 2) --126 --126 Procedures (number) 3 Enforcing contracts (rank)138 -- 145 (AW 15) Most di cult Time (days) 6 Procedures (number) -- 50 Cost (181)ofEase 172 (% propertyStarting of value)a Dealing with Employing Registering 2.0 Getting Time (days) Protecting Paying Trading Enforcing Closing a 607 doing business construction workers property credit Cost (% ofinvestors claim) taxes across contracts business 26.3 getting credit (rank) business permits 68 (AW 2) borders Strength of legal rights index (0-10) 4 Closing a business (rank) 141 (AW 15) Depth of credit information index (0-6) 5 Time (years) 5.1 Public registry coverage (% of adults) 6.5 Cost (% of estate) 30 Private bureau coverage (% of adults) 7.7 Recovery rate (cents on the dollar) 10.2 145 Most di cult (181) Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRy TABLES 77 COUNTRY PROFILE West Bank and Gaza Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) --38 -- 25 -- 80 -- 85 --109 --131 --122 Most di cult --163 (181) --166 --149 --181 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Yemen Ranking weSt bank anD gaza Ease of doing business (rank) 131 (AW 13) NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG EASIEST (1) Middle East & North Africa SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA GNI per capita (US$) ZEALAND MALDIVES SINGAPORE CHINA JAPAN 1,230 Lower middle income Population (m) 3.9 starting a business (rank) --50 --33 166 (AW 18) 48 -- protecting investors (rank) --41 38 (AW 3) Procedures (number) --69 11 Extent of disclosure index (0-10) 6 Time (days) --98 49 Extent of director liability index (0-10) --875 Cost (% of income per capita) 69.1 Ease of shareholder suits index (0-10) 7 Minimum capital (% of income per capita) 56.1 Strength of investor protection index (0-10) --126 --138 --126 6.0 Most di cult Dealing with construction permits (rank) -- (181) 149 (AW 19) paying taxes (rank) 172 25 (AW 8) ProceduresEase Registering Getting Trading Enforcing Closing a doing (number)Starting of a Dealing with Employing business construction workers property 21 PaymentsProtecting perPaying credit investors (number taxes year) across contracts business 27 Time (days) business permits 199 Time (hours per year) borders 154 Cost (% of income per capita) 1,399.9 Total tax rate (% of profit) 16.8 Employing workers (rank) 109 (AW 12) trading across borders (rank) 85 (AW 11) Difficulty of hiring index (0-100) 33 Documents to export (number) 6 Rigidity of hours index (0-100) 40 Time to export (days) 25 Difficulty of firing index (0-100) 20 Cost to export (US$ per container) 835 Rigidity of employment index (0-100) 31 Documents to import (number) 6 Firing cost (weeks of salary) 91 Time to import (days) 40 Cost to import (US$ per container) 1,225 Registering property (rank) 80 (AW 12) Procedures (number) 7 Enforcing contracts (rank) 122 (AW 10) Time (days) 63 Procedures (number) 44 Cost (% of property value) 0.9 Time (days) 700 Cost (% of claim) 21.2 getting credit (rank) 163 (AW 15) Strength of legal rights index (0-10) 0 Closing a business (rank) 181 (AW 17) Depth of credit information index (0-6) 3 Time (years) No practice Public registry coverage (% of adults) 7.8 Cost (% of estate) No practice Private bureau coverage (% of adults) 0.0 Recovery rate (cents on the dollar) 0.0 Most di cult --163 (181) --166 --149 --181 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a 78 DOING BUSINESS IN THE ARAB WORLD 2009 doing business construction workers property credit investors taxes across contracts business business permits borders COUNTRY PROFILE Yemen Ranking NEW ST. VINCENT & UNITED SAUDI NEW HONG KONG SINGAPORE ZEALAND THE GRENADINES STATES ARABIA MALAYSIA ZEALAND MALDIVES SINGAPORE CHINA JAPAN EASIEST (1) --50 --33 --48 --41 --69 --98 --87 --126 --138 --126 Most di cult -- (181) 172 Ease of Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a doing business construction workers property credit investors taxes across contracts business business permits borders YeMen Ease of doing business (rank) 98 (AW 8) Middle East & North Africa GNI per capita (US$) 870 Low income Population (millions) 22.4 starting a business (rank) 50 (AW 5 protecting investors (rank) 126 (AW 14) Procedures (number) 7 Extent of disclosure index (0-10) 6 Time (days) 13 Extent of director liability index (0-10) 4 Cost (% of income per capita) 93.0 Ease of shareholder suits index (0-10) 2 Minimum capital (% of income per capita) - Strength of investor protection index (0-10) 4.0 Dealing with construction permits (rank) 33 (AW 3) paying taxes (rank) 138 (AW 17) Procedures (number) 13 Payments (number per year) 44 Time (days) 107 Time (hours per year) 248 Cost (% of income per capita) 189.7 Total tax rate (% of profit) 47.8 Employing workers (rank) 69 (AW 9) trading across borders (rank) 126 (AW 16) Difficulty of hiring index (0-100) 0 Documents to export (number) 6 Rigidity of hours index (0-100) 60 Time to export (days) 31 Difficulty of firing index (0-100) 40 Cost to export (US$ per container) 1,129 Rigidity of employment index (0-100) 33 Documents to import (number) 9 Firing cost (weeks of salary) 17 Time to import (days) 28 Cost to import (US$ per container) 1,475 Registering property (rank) 48 (AW 7) Procedures (number) 6 Enforcing contracts (rank) 41 (AW 1) Time (days) 19 Procedures (number) 37 Cost (% of property value) 3.8 Time (days) 520 Cost (% of claim) 16.5 getting credit (rank) 172 (AW 18) Strength of legal rights index (0-10) 2 Closing a business (rank) 87 (AW 10) Depth of credit information index (0-6) 0 Time (years) 3.0 Public registry coverage (% of adults) 0.1 Cost (% of estate) 8 Private bureau coverage (% of adults) 0.0 Recovery rate (cents on the dollar) 28.6 79 Acknowledgments Doing Business in the Arab World 2009 in collaboration with Pricewaterhouse- Contact details for local partners was prepared by a team led by Yara Coopers, led by Robert Morris. are available on the Salem and Dahlia Khalifa. Doing Busi- Alison Strong copyedited the manu- Doing Business website at ness 2009 was prepared by a team led by script. Gerry Quinn designed the report Sylvia Solf, Simeon Djankov (through and the graphs. Kim Bieler assisted in the http://www.doingbusiness.org March 2008) and Penelope Brook (from typesetting. Alexandra Quinn provided April 2008) under the general direction desktopping services. The online service of Michael Klein. The team comprised of the Doing Business database is man- Teymour Abdel Aziz, Svetlana Bagau- aged by Ramin Aliyev, Felipe Iturralde dinova, Karim O. Belayachi, Mema Escudero and Graeme Littler under the Beye, Frederic Bustelo, César Chaparro direction of Suzanne Smith. Yedro, Maya Choueiri, Roger Coma- Wearegratefulforvaluablecomments Cunill, Santiago Croci Downes, Marie De- provided by colleagues across the World lion, Allen Dennis, Jacqueline den Otter, Bank Group and for the guidance of World Alejandro Espinosa-Wang, Monica Fon- Bank Group Executive Directors. seca Fernandez, Kjartan Fjeldsted, Elena The report was made possible by Gasol Ramos, Carolin Geginat, Cemile the generous contribution of more than Hacibeyoglu, Jamal Haidar, Sabine Hert- 6,700 lawyers, accountants, judges, busi- veldt, Palarp Jumpasut, Dahlia Khalifa, nesspeople and public officials in 181 Jean Michel Lobet, Oliver Lorenz, Valerie economies. Global and regional con- Marechal, Andres Martinez, Alexandra tributors are firms that have completed Mincu, Sushmitha Narsiah, Joanna Nasr, multiple surveys in their various offices Dana Omran, Caroline Otonglo, Nadia around the world. Ram, Rita Ramalho, Camille Ramos, Quotations in this report are Ivana Rossi, Yara Salem, Pilar Salgado- from Doing Business local partners un- Otónel, Umar Shavurov, Larisa Smirnova, less otherwise indicated. The names of JayashreeSrinivasan,SusanneSzymanski, those wishing to be acknowledged in- Tea Trumbic, Caroline van Coppenolle, dividually are listed on the following Bryan Welsh, Justin Yap and Lior Ziv. Jan pages. Contact details are posted on the Bezem, Sonali Bishop, Tara Sabre Collier, Doing Business website at http://www Sarah Iqbal, Alice Ouedraogo, Babacar .doingbusiness.org. Sedikh Faye and Jennifer Yip assisted in The case studies appearing on pages the months prior to publication. 44­53 were first published in Celebrat- Oliver Hart and Andrei Shleifer pro- ing Reform 2007 and Celebrating Reform vided academic advice on the project. 2008. The paying taxes project was conducted 80 Doing Business in the araB worlD 2009 AlgeriA Tarik Zahzah Jawad Habib Jawad egypt Ashraf Elibrachy Ghellal & Mekerba BDO Jawad Habib Ibrachy Law Firm Branka Achari-Djokic Abdel Aal Aly Banque d'Algérie Nabiha Zerigui Sara Jawahery Mohamed El-Labboudy Cabinet d'Avocats Samir Elham Ali Hassan & Afifi World Transport Nadoury & Nahas Law Salima Aloui Hamouda Associates Naguib Abadir Offices Law Firm Goussanem & Nacita Corporation Aloui BAhrAin Ebrahim Karolia Hassan Fahmy PricewaterhouseCoopers Walid Abbas Ministry of Investment Hadda Ammara Advanced Group Bouchaib Law Firm Khalid Abdulla Elie Kassis Heba Foaad Tameer Agility Logistics Girgis Abd El-Shahid PricewaterhouseCoopers Khodja Bachir Sarwat A. Shahid Law Firm SNC Khodja & Co. Aysha Mohammed Abdulmalik Mubeen Khadir Ashraf Gamal El-Din Ernst & Young Sara Abdel Gabbar Egyptian Institute of Hassan Djamel Belloula Elham Ali Hassan & Trowers & Hamlins Directors Cabinet Belloula Associates Mohammed Abdul Khaliq Tameer Ahmed Abdel Warith Yaser Gamaluddin Hamam Tayeb Belloula Khaled Hassan Ajaji AAW Consulting Engineers The Egyptian Law Firm Cabinet Belloula Ministry of Justice & Abdul-Haq Mohammed Islamic Affairs Trowers & Hamlins Ramez Mounir Abdel-Nour Ahmed Gawish Adnane Bouchaib Karim Adel Law Office Ministry of Transport Bouchaib Law firm Mohammed Abdullah Al Sisi Abdullah Mutawi Al Buainain Trowers & Hamlins Mohamed Abo -Shady Hend Abdel Ghany Fatma Zohra Bouchemla Al Boainain Legal Services Modern Agricultural Est. Mena Associates, Attorney-at-Law Hassan Ali Radhi Nawaf Bin Ebrahim Al Kalifa Hassan Radhi & Associates Ahmed Abou Ali member of Amereller Jean-Pierre Comunale Electricity & Water Hassouna & Abou Ali Rechtsanwälte SDV Authority Hameed Yousif Rahma Karim Adel Kamel Ghobrial Ministry of Industry & Gamal Abou Ali Arezki Djadour Hamed Mohamed Al Khalifa Commerce Hassouna & Abou Ali Karim Adel Law Office Gide Loyrette Nouel, Ministry of Municipalities Zeinab Saieed Gohar member of Lex Mundi & Agriculture Urban Najma A. Redha Hasan Nermine Abulata Ministry of Municipalities Ministry of Trade & Central Bank Asmaa El Ouazzani Planning & Agriculture Affairs. Industry Rimon Hakim Landwell & Associés - Haider Hashim Al Noami Municipal One Stop Shop Sarwat Group for Export PricewaterhouseCoopers Ministry of Municipalities Ghada Adel and Import Legal Services & Agriculture Affairs. Mohamed Salahuddin PricewaterhouseCoopers Mohamed Salahuddin Emad Hassan Malik Elkettas Municipal One Stop Shop Consulting Engineering Hazem Ahmed Ministry of State Elkettas International Mohammed Al Noor Bureau Hassouna & Abou Ali for Administrative Brahim Embouazza Al-Twaijri and Partners Latifa Salahuddin Mahmoud Ahmed Bassiem Development MCDConsulting Law Firm Qays H. Zu'bi Ashraf El Al Arabi Omneia Helmy Mohamed Lehbib Goubi Mohammed Hasan Al The Egyptian Center for Zaimoor E. Hugh Stokes Ministry of Finance Banque d'Algérie Economic Studies Ministry of Industry & Hatim S. Zu'bi & Partners Abd El Wahab Aly Ibrahim Khaled Goussanem Commerce Judith Tosh Abd El Wahab Sons Lobna Mohamed Hilal Law Firm Goussanem & Central Bank Samer Al-Ajjawi Norton Rose Tim Armsby Aloui Ernst & Young Robin Watson Trowers & Hamlins Mamdoh Farghli Kassem Samir Hamouda The Egyptian Law Firm Abdulmajeed Ali Alawadhi The Benefit Company Amr Mohamed Mahmoud Cabinet d'Avocats Samir Atta Sherif Mansour Hamouda Electricity & Water Authority Adrian Woodcock Norton Rose Karim Adel Law Office PricewaterhouseCoopers Samy Laghouati Fatima Alhasan Adel Awadalla Nouran Mohamed Gide Loyrette Nouel, Hatim S. Zu'bi PricewaterhouseCoopers member of Lex Mundi Qays H. Zu'bi Hatim S. Zu'bi & Partners S.S.I.B. Mohamed Mohamed Nadia Larbaoui Ebtihal Al-Hashimi Ziad Bahaa El Dian Comoros Private Practice Bouchaib Law Firm Ministry of Municipalities General Authority for & Agriculture Affairs. Investment and Free Zones Mostafa Mostafa Karine Lasne Municipal One Stop Shop Harimia Ahmed Ali Louis Bishara Al Kamel Law Office Landwell & Associés - Shaji Alukkal Cabinet Me Harimia PricewaterhouseCoopers Remy Grondin BTM Ashraf Nadoury Legal Services Panalpina Vitogaz Comores Ibrahim Hassan Dakr Nadoury & Nahas Law Offices Michel Lecerf Bilal Ambikapathy Ahamada Mahamoudou Karim Adel Law Office Landwell & Associés - Norton Rose Avocat à la Cour Hussein Mahmoud Gaafar El Mariama Sabet PricewaterhouseCoopers Maaria Ashraf Gebaly Mohamed Serry Legal Services Hatim S. Zu'bi & Partners Youssouf Yahaya Ministry of Housing, Serry Law Office Adnane Merad Mohammed R. Awadh Impots de la Grande Utilities, and Urban Comore Wael Shaker Etude de Me Kaddour Bahrain Investors Center Development Merad Island Group Mohammed Mirza A. Hussain DjiBouti Mohamed EL Gindy Narimane Naas Bin Jaffer Waad Trade & Safwat Sobhy Gide Loyrette Nouel, Ministry of Municipalities Rahma Abdi Abdillahi Development Co. PricewaterhouseCoopers member of Lex Mundi & Agriculture Affairs. Banque Centrale Mohamed El Homosany South Cairo Electricity Fériel Oulounis Municipal One Stop Shop Wabat Daoud Ministry of Justice Distribution Company Cabinet d'Avocats Samir Hussain Saleh Dhaif Avocat à la Cour Mohamed Refaat El Houshy Cath Welch Hamouda Mela Bahrain Bruno Détroyat The Egyptian Credit PricewaterhouseCoopers Maya Sator Michael Durgavich Ibrahim Hamadou Hassan Bureau "I-Score" Eman Zakaria Cabinet Sator Al-Sarraf & Al-Ruwayeh Ibrahim Mohamed Omar Amr El Monayer Ministry of Manpower & Mohamed Sator Yousif A. Humood Migration Cabinet CECA Ministry of Finance Cabinet Sator Ministry of Finance Mona Zobaa Oubah Mohamed Omar Hasan El Shafiey Marc Veuillot Abdulwahid A. Janahi Ministry of Investment Société Maritime L. 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(KSC) Meouchi Law Firm, member Meouchi Law Firm, member member of Amereller of Interleges of Interleges Rechtsanwälte Zalloum & Laswi Law Firm Tim Bullock Al-Fahad & Co, Deloitte & Dania George Mireille Richa Ahmad Al Jannabi Husam Jamil Madanat Touche PricewaterhouseCoopers Tyan & Zgheib Law Firm Mena Associates, Land and Survey Samer Ghalayini member of Amereller Directorate Paul Day Jihad Rizkallah Rechtsanwälte Firas Malhas Al Sarraf & Al Ruwayeh The Levant Lawyers Badri and Salim El Meouchi Law Firm, member Farquad Al-Salman International Business Sam Habbas Fady Ghanem of Interleges F.H. Al-Salman & Co. Legal Associates Al Sarraf & Al Ruwayeh Badri and Salim El Meouchi Law Firm, member Elias A. Saadé Florian Amereller Munaf Malkawi Nazih Abdul Hameed of Interleges Moghaizel Law Firm, Amereller Rechtsanwälte Mufida Art Mosaic Al-Saleh & Partners Greta Habib member of Lex Mundi Blund Faridoon Arif Najeb Maher Melhem Sunil Jose Badri and Salim El Joseph Safar Attorney-at-Law Abu-Ghazaleh Abu-Ghazaleh Consulting Professional Consulting Meouchi Law Firm, member and Intellectual Property Hayek Group of Interleges Husam Addin Hatim (AGPC) Mazen A. Khoursheed Christel Salem Louay Hajj Chehadeh Stephan Jäger Amer Mofleh Packaging and Plastic Badri and Salim El Ministry of Finance Meouchi Law Firm, member Amereller Rechtsanwälte International Business Industries Co. (KSC) Legal Associates Abdallah Hayek of Interleges Imad Makki Jasmin Paurus Kohina Hayek Group Rached Sarkis Al Qarya Group Co. Khaldoun Nazer Abdullah Kh. Al-Ayoub & Khalifeh & Partners Associates, member of Lex Wajih Hechaime Rached Sarkis Office jorDAn Omq Al Bihar Est. Mundi Hechaime law firm Camille C. Sifri PricewaterhouseCoopers Saleh Abdelati Ahmad Quandour Chirine Krayem Moujaes Fady Jamaleddine Ali Sharif Zu'bi, Advocates Khalifeh & Partners The Law Offices of Mishari The Levant Lawyers Nady Tyan & Legal Consultants, Al-Ghazali Maria Jreissat Tyan & Zgheib Law Firm member of Lex Mundi Osama Y. Sabbagh The Jordanian Electric Dany Labaky Badri and Salim El Patricia Yammine Chaled Abu-Gharbieh Power Co. Ltd. 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Ali Consultants Amin Hajji & Associés Damco PricewaterhouseCoopers Al Khorri Advocate & Ali Said Othman Association d'Avocats Zubaida Fakir Mohamed Al Mansoor Jamal Malik Legal Consultants Central Tenders Rachid Benzakour Balushi Al Alawi, Mansoor Jamal Adnan Ali Committee Cabinet d'Avocats Central Bank & Co. PricewaterhouseCoopers Mohammed SHK. Qasem Benzakour & Lahbabi Ahmed Al Barwani Kapil Mehta Abdul Rahman Ali Almotawa Khatib & Alaml Richard Cantin Denton Wilde Sapte Maersk Line Customs and Ports Annette Seiffert Juristructures - Project Azzan Qasim Al Busaidi General Authority Clyde & Co. Legal Management & Legal International Research Subha Mohan Consultants Advisory Services LLP Foundation Curtis Mallet - Prevost, A. Rahman Mohamed Al-Jufairi Sarah Simms Mahat Chraibi Colt & Mosle LLP Khamis Abdullah Al-Farsi A. Rahman Mohamed Clyde & Co. Legal Alleance advisory Maroc Ministry of Commerce and Ala Hassan Moosa Al-Jufairi Consultants Driss Debbagh Industry Muscat Electricity Distribution Company Juma Ali Rashed Al-Kaabi Laura Warren Kettani Law Firm Said bin Saad Al Shahry Jessica Morris Ministry of Economy & Clyde & Co. Legal Youssef El Falah Said Al Shahry Law Office Commerce Denton Wilde Sapte Consultants ABA Rule of Law Ali Nassir Seif Al-Bualy Rashid Bin Abdulla Al-Khalifa Terence G.C. Witzmann Initiative-Morocco Al-Bualy Attorneys at Law Bruce Palmer Law Office of Rashid Bin HSBC Hafid Elbaze & Legal Consultants Curtis Mallet - Prevost, Abdulla AI-Khalifa Colt & Mosle LLP Alleance advisory Maroc Mohsin Ahmed Alawi Khalil Al-Mulla sAuDi ArABiA Marian Paul Mourad Faouzi Al-Hadad Customs and Ports Al Alawi, Mansoor Jamal Emad Fareed Abdul Jawad Oulamine Law Group Mohsin Al-Hadad & Amur General Authority Al-Kiyumi & Partners & Co. Globe Marine Services Co. Nawal Jellouli Muna Al-Mutawa Reji Paul Abdulaziz Abdullatif Ministère de l'économie et Khalid Khamis Al-Hashmi Advocate & Legal Dr. Abdullah Alsaidi Law Al-Soaib Law Firm des finances Muscat Municipality Consultant Office Ali Abedi Azeddine Kabbaj Abdullah Alsaidi Mohammed H. Al-Naimi Madhu Sathyaseelan The Allaince of Abbas Barreau de Casablanca Dr. Abdullah Alsaidi Law Central Tenders office Jihad Al-Taie & Associates Committee F. Ghazzawi & Co. and Mehdi Kettani Hammad, Al-Mehdar & Co. 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