Doing business in Africa is getting easier

According to Doing Business
2012: Doing Business in a
More Transparent World, an
annual report from the IFC and
World Bank, a record number
of African countries have taken
decisive steps to encourage more
local entrepreneurs to come into
the formal economy over the
past 12 months.
Trade barriers have also been
lowered. Liberia, Seychelles and
Tanzania are the latest countries
to accept customs declarations
electronically.
But, 21 of the bottom 30
countries in this year’s rankings
are in Africa.
Eleven countries implemented
no reforms at all, while nine
adopted policies that made
things worse.
In most African countries,
getting access to essential
information, such as what types
of documents are needed to ship
a container abroad or even what
the fee schedule is, requires a
meeting with an official.
This can cause unnecessary
delays and perhaps even open
the door to improper payments,
says the report.
On the plus side, 15 countries
lowered barriers to entry for new
businesses; 23 facilitated access
to credit; and seven made it
easier to pay taxes.
As a case in point, when the
second Doing Business report
was published in 2004, it took
153 days, 14 procedures, and a
minimum capital equivalent to
14.5% of the country’s per capita
income to start a business in
Mozambique.
Today it takes 13 days, nine
procedures, and no minimum
capital.
Over the past year alone, 36
out of 46 countries (more than
three-quarters) implemented
reforms in at least one of the
10 areas measured by Doing
Business.
For the fourth year in a row,
Mauritius was the easiest place
in sub-Saharan Africa for an
entrepreneur to do business.
Ranking 23rd on the global
scene, the island nation is
followed by South Africa (35th
place globally), Rwanda (45th),
Botswana (54th), and Ghana
(63rd place).
South Africa ranks first
globally on access to credit,
and Rwanda is the world’s 8th
best country when it comes to
starting a business.