Africa continues to be one of the
most challenging regions of
the world in which to do business.
This is highlighted in both the
2016 World Bank Ease of Doing
Business 2016 report and the 2015
International Monetary Fund
(IMF) Regional Economic Outlook
for sub-Saharan Africa.
The reports confirm what FTW
is told by companies offering
logistics services in neighbouring
countries and farther up into the
continent.
There are, however, some signs of
it getting easier, with a reduction in
red tape in particular.
Sub-Saharan Africa accounted
for about 30% of the regulatory
reforms, making it easier to do
business in 2014/15, followed by
Europe and Central Asia.
Leading the reforms is West
Africa, where countries are
working through the Organisation
for the Harmonisation of Business
Law in Africa. Some 14 of the 17
have signatories implemented
business regulation reforms in the
past year.
Twenty-four of these reforms
reduced the complexity and cost
of regulatory processes, while
the other five strengthened legal
institutions.
There is a fresh urgency for
reforms to be introduced. The IMF
economic outlook for sub-Saharan
Africa says growth in the region
has “weakened markedly and is
now projected at 3.75% this year
and 4.25% in 2016 – from 5% in
2014.
The slowdown is uneven.
According to the IMF, countries
such as Côte d’Ivoire, the
Democratic Republic of the
Congo, Ethiopia, Mozambique,
and Tanzania are still expected to
register growth of 7% or more this
year and next.
According to the Ease of Doing
Business index the best place to
be in Africa is Mauritius, which is
rated 32nd.
Mauritius scores highly on good
judicial practices, and a reduction
in the time taken to obtain
construction permits. It ranks 66th
in the “trading across borders”
category – the one which directly
impacts freight and forwarding
industry and its clients.
It measures the time taken and
the cost of importing or exporting
a container.
This includes the number
of documents that need to be
processed and the internal logistics
costs.
On the mainland the easiest
place to do business is Rwanda in
62nd position, but it comes in at
156th in the critical trading across
borders measurement.
Next is Botswana on 72 (51st
in trading across
borders) and
South Africa
on 73 (but
ranked
179th in
trading
across
borders).
After
that comes
Zambia (97th
on ease of doing
business and
152nd on trading
across borders)
and Namibia
(101st and 118th).
The trading
across borders score
is particularly important for
Namibia, which is positioning itself
as the logistics gateway for imports
and exports into the Southern
African Development Community
(SADC).
Kenya, which is listed among the
economies that improved the most
in 2014/2015, is now ranked 108th
in ease of doing business and 131st
in trading across borders.
Investment in the country’s
transport and power generation
sectors is expected to
support growth in Kenya,
according to the IMF
report.
Also moving up
fast is Uganda
(122nd and
128th) and
Benin (158th and 116th).
