The World Bank released its 2013 Doing Business report this week. The document ranks all the world’s nations on how hospitable they are to starting and running a business.
Ranking criteria include everything from construction permits to taxation to the accessibility of credit.
Let’s count down the top ten easiest African countries to do business and list some of the recent reforms they’ve undertaken that make them favorites of African entrepreneurs and CEOs.
10. Kenya (Global Rank #121)
- Enhanced electronic filing systems which eased the process of paying taxes, reducing the average time required to file taxes from 393 hours to 340 hours.
- Made contract enforcement easier by introducing a new case management system for the resolution of commercial disputes.
- Reduced the amount of red tape involved in registering a new business. As a result, the start-up process is two days shorter than it was in 2010.
9. Uganda (Global Rank #120)
- Clarified mortgage rules which reduced the risks involved in lending (and borrowing) to homeowners.
- Established a private credit bureau. The agency now maintains credit information on 3.7% of Ugandan adults from 0% just three years ago.
- Streamlined its court system, shortening the amount of time to resolve a case by an average of 20 days since 2010.
8. Zambia (Global Rank #94)
- Eliminated the minimum capital requirement for starting a business, encouraging potential entrepreneurs.
- Consolidated its border post with Zimbabwe to ease the flow of goods and allowed customs declarations to be submitted online, reducing the average time to import and export goods by roughly 15% since 2010.
- Brought its court system into the cyber-age, allowing electronic reference of cases, laws, and records.
7. Namibia (Global Rank #87)
- Reduced the time and expense required to connect to the electrical grid. On average, it now takes 38 days. Last year it took 55.
- Adopted new legislation that clarifies the procedures for liquidation.
- Computerized the system for registering a new business, slashing registration times.
6. Seychelles (Global Rank #74)
- Over the past five years, eliminated the social security tax and reduced labor and corporate income taxes. The three cuts resulted in the effective tax rate dropping from 48.4% in 2008 to 25.7% today.
5. Ghana (Global Rank #64)
- Granted an operating license to a private credit bureau, providing credit info on nearly 6% of the adult population. The country now ranks 23rd in the world in access to credit.
- Drastically reduced the amount of time it takes to launch a new business. It now takes just 12 days compared to 42 in 2008. Moreover, the minimum capital requirement has been lowered considerably and now equates to just 4.3% of per capita income. It was more than 20% of per capita income five years ago.
4. Botswana (Global Rank #59)
- Upgrades at the country’s busiest border post with South Africa have slashed the length of time for import and export of goods by nearly a week.
- Streamlined business start-up procedures; reducing the length of time to get a business rolling by over 40% (47 days since 2008).
- Technology upgrades in the Botswana court system have sped up the resolution of commercial disputes, reducing the average court case from 987 days in 2008 to 625 days presently.
3. Rwanda (Global Rank #52)
- Now one of the easiest places in the world to start a business (Global Rank #8), entrepreneurs can be up and running in just three days time and registration fees are negligible.
- A private credit bureau boasts very deep credit information on over 7% of the adult population. Consumers have the right to inspect their own credit reports.
- Shortened the length of time required for connection to the electricity grid from 55 days in 2011 to 30 days today.
2. South Africa (Global Rank #39)
- The best place in the world to obtain credit. Credit rating agencies have access to a wealth of data and legal protection for lender and borrower is unparalleled.
- Instituted a customs modernization program that reduced export times from 30 days in 2008 to 16 days now and import times from 35 to 23 days.
- Simplified the tax code to reduce tax prep times from 350 hours per year five years ago to 200 hours per in 2012. Also reduced the effective tax rate from 37.1% to 33.3%.
1. Mauritius (Global Rank #19)
- Eased property transfers by implementing an electronic record-keeping system and by statutorily limiting the length of time it takes to receive land title. It now takes just 15 days to register property in Mauritius. Five years ago, it took 210 days.
- Instituted a wide-ranging and deep public credit registry. Credit info is now available for the majority (56%) of the adult population.
- Recruited more judges and added more court rooms to reduce judicial backlog, shortening the average court case by more than 100 days.
What Do You Think?
So there you have it. Africa’s best homes for business. Do the results surprise you? Let us know why or why not in the comments!