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Friday, 28 September 2007

How business friendly is Zambia?

The World Bank yesterday released its annual ranking of the ease of doing business in 178 economies. Economies are ranked on their ease of doing business, from 1 – 178, with first place being the best. A high ranking on the ease of doing business index means the regulatory environment is conducive to the operation of business. This index averages the country's percentile rankings on 10 topics, made up of a variety of indicators, giving equal weight to each topic.

Best to focus on the
African rankings - not much point to compare ourselves to the heavyweights like Singapore. Zambia is ranked 11th in Africa. Interesting to note that it ranks quite well on "paying taxes" relative to other African nations. No prizes for guessing why that is :).

Update: Also worth checking out the Milken Index released early this year - it measures firms' access to capital accross countries.

8 comments:

  1. "How business friendly is Zambia?"

    I think that actually should be amended to - how business friendly is Zambia... for Zambian businesses?

    It is alright for the state to give tax holidays and other significant benefits to foreign businesses, but why don't they extend the same to Zambian businesses?

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  2. There is an erroneous belief that investment is only through FDI. Local businesses could actually harness local resources through LuSE, or, indeed, by government making it for local investors to not only start businesses but by also extending incentives to such entrepreneurs.
    Instead, what we see is our government making it very difficult for local people to start and maintain businesses.

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  3. Instead, what we see is our government making it very difficult for local people to start and maintain businesses.

    And I too would like to know why that is.

    I think a creative government should get together and see how the laws can be changed to stimulate Zambian businesses and local markets.

    ReplyDelete
  4. And I would like to add - keep at it and not stop until they do.

    More like a permanent task force to reform business and related laws.

    ReplyDelete
  5. "I think a creative government should get together and see how the laws can be changed to stimulate Zambian businesses and local markets". - Mrk

    The challenge for any Government is finding out what constrains small businesses.

    Empirical assessment is the key because every economy is different from another. By that I mean that whilst we can accept that all the drivers mentioned in the "ease of doing business" rankins are important, the scale to which these factors impact an economy may differ from country to country.

    This is why country specific studies are so critical. Zambian think tanks and Government can work together to ensure that such factors are addressed. Very limited work is being done in this area focusing specifically on Zambia. The work should be done by the Ministry of Commerce and made public for everyone to discuss and question it.

    I think there's need for think tanks in the future to take a lead in this area and start asking such questions.

    The ease of doing business identifies the following areas as critical for encouraging business.

    1. Starting a Business
    2. Dealing with Licenses
    3. Employing Workers
    4. Registering Property
    5. Getting Credit
    6. Protecting Investors
    7. Paying Taxes
    8. Trading Across Borders
    9. Enforcing Contracts
    10.Closing a Business

    What is needed to assess which of these factors are actually critical for growth of business specifically in Zambia. Yes all of them matter, but which are more critical? It requires a s

    These are the questions the Ministry should be assessing and sharing with the public. Without such analysis the policy development is a stab in the dark.

    ReplyDelete
  6. That is the beginning of a questionnaire right there.

    The chambers of commerce could be involved in this, or there could be a single study from a ministry.

    But it is important that the entire business process of companies in the country is monitored on a continuing basis.

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  7. Cho,

    Cho,

    What do you make of these two statements:

    And from the Daily Mail:

    He said deliberate steps were also being taken to dismantle unnecessary red- tape against business development by way of reducing to one day the company registration process.


    http://maravi.blogspot.com/2007/10/times-levy-throws-gauntlet-to-zambians.html

    Speaking at the same meeting, Commerce Trade and Industry minister, Felix Mutati said Zambians abroad should consider cutting down on food consumption so they could remit at least $1,000 or more to their relatives

    ReplyDelete
  8. Mr Mutati is funny!

    I have yet to blog on his brand of Mutatisms....I think one can actually create a specific blog called Mutatism..a bit like the blog I can across on Bushism...

    He does say some very strange things...

    What Zambians abroad need is to form networks...this is why I am strong involved with the ZANS initiative....I expect that bear fruit pretty soon.

    Skills transfer is a better way for Zambians to help the nation. Now if other networks developed that facilitated Zambians abroad investing jointly in projects at home, that would be fantastic.

    ReplyDelete

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