ESWATINI DROPS IN EASE OF DOING BUSINESS FOR 3RD TIME

MBABANE – Eswatini has dropped five places in the Ease of Business charts.  The World Bank, through its 16th edition of the Ease of Doing Business Report 2019 released on Wednesday afternoon, disclosed that the kingdom was ranked at 117 out of 190 countries.

This effectively means Eswatini’s business environment continues to diminish on a yearly basis when taking into consideration the fact that in 2018, the World Bank ranked the country at 112, which was a regression from the 2017 ranking of 111 out of 190 economies.

The Ease of Doing Business Report is one of the yardsticks used by investors in measuring the conduciveness of a country’s business environment. It is regarded as the best measurement by most investors. Therefore, the country’s poor ranking in this regard, put it at a competitive disadvantage in the southern African region, more so because all countries in the region scramble for the same investors.

Out of the core pillars used by the World Bank in determining the level of ease of doing business, the country dropped in six key areas namely; getting credit, dealing with construction permits, resolving insolvency, protecting investors, starting business, getting electricity and enforcing contracts (enforcing of contracts pertains to the delayed payment of suppliers).

This was the similar situation in the 2018, report where the country was ranked ninth out of 18 countries. On top was Mauritius, who was regarded as Africa’s fastest growing economy. It was followed by Botswana, South Africa, Zambia, Seychelles, Lesotho, Namibia and Malawi, respectively.

Among members of the Southern African Customs Union (SACU), who are Botswana, Lesotho, Namibia and Swaziland and South Africa, the kingdom was also ranked poorly. This means the business environment was not as good as the other countries.

Process

Regarding starting a business in Eswatini, the World Bank reported that starting a business in the country was still a long process as it requires 12 procedures, takes 30 days, costs 14.8 per cent of income per capita for men.

The bank said the procedures comprise of the bureaucratic and legal steps that an entrepreneur must complete to incorporate and register a new firm.
“These are identified by Doing Business through collaboration with relevant local professionals and the study of laws, regulations and publicly available information on business entry in that economy,” reads the report in part.

Regarding getting electricity, globally, Eswatini dropped three places. In the 2018 report, the kingdom was at 159 in the ranking of 190 economies on the ease of getting electricity. In 2017, it had been placed at position 157, which shows that it has regressed even further. Arguably, this might be due to the fact that other countries made reforms in this regard, while Eswatini did nothing.

The World Bank said the indicators reported for Eswatini were based on a set of specific procedures the steps that an entrepreneur must complete to get a warehouse connected to electricity by the local distribution utility identified by Doing Business.
In terms of paying taxes and trading across borders, the country maintained the same positions of 32 /190 and 63/190, respectively. 

Doing Business is an annual report measuring the regulations that enhance business activity and those that constrain it. Doing Business presents quantitative indicators on business regulations and the protection of property rights that can be compared across 190 economies—from Afghanistan to Zimbabwe—and over time.

Doing Business measures regulations affecting 10 areas of the life of a business. These areas are: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency.



 

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