Saudi Arabia and Bahrain receive high marks in survey

Robert Hamilton
For Al-Shorfa.com
2008-09-25

Saudi Prince Bandar bin Saud bin Khaled al-Saud discusses ways to achieve economic growth and create a strong business environment in Saudi Arabia and the Middle East.Issam Kanadani/ AFP/Getty Images

Saudi Arabia and Bahrain are ranked among the top 25 countries for ease of doing business in the world, according to the World Bank’s Doing Business 2009 report. The increasingly relaxed regulatory environments of both Gulf states have led to more dynamic business sectors and made it easier for firms to establish themselves. Saudi Arabia leads the Gulf countries in global ranking in ease of doing business at 16, followed by Bahrain at 18, Qatar at 37 and the United Arab Emirates at 46, the report shows. It takes an average of six days to start a business in Qatar, seven days in Egypt, nine days in Bahrain, 12 days in Saudi Arabia, 13 days in Yemen and 17 days in the United Arab Emirates.

The report ranked Egypt as one of the top 10 economies in terms of business regulations reform, the third time in four years that Egypt has held that distinction. Across the Middle East and North Africa, the report records a total of 27 reforms in 12 countries between June 2007 and June 2008 that make it easier to do business.

“Economies worldwide are increasingly committed to regulatory reforms, and this is evident in the Middle East and North Africa, the region with the second-largest share of economies that made it easier to do business,” Dahlia Khalifa, co-author of the report, said in a press statement released on Sept. 10 to accompany the report.

“Many economies, including Egypt and Saudi Arabia, are consistently making improvements and are advancing in the global rankings,” added Khalifa. “Across the region, countries are making it easier to do business by looking to early pacesetters for ideas on how to reform.”

The report noted that Saudi Arabia has made it easier to start a business by continuing to simplify formalities for commercial registration and reducing registration fees by 80 percent. The region’s most popular area for reform is business start-up, with nine economies making improvements. The second most popular area has been in credit bureau enhancements that improve access to credit. In this area, the United Arab Emirates rated particularly high, ranked 46 globally.

Mohammad Bin Essa Al Khalifa, Chief Executive of Bahrain Economic development Board talks during a session at the World Economic Forum in Davos, which is an annual gathering of the world's political and business elite. Pierre Verdy /AFP/Getty Images

“The United Arab Emirates’ credit bureau, Emcredit, started collecting information on the repayment pattern of individual borrowers as well as firms in February 2007,” the report states. “This has allowed better supervision of the debt level of banks and borrowers.”

Doing Business tracks reforms aimed at simplifying business regulations, strengthening property rights, opening up access to credit and enforcing contracts by measuring their impact on 10 indicator sets.

The 10 indicator sets include starting a business, dealing with construction permits, employing workers, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts and closing a business.

The Doing Business press release pointed out that the rankings do not reflect such areas as macroeconomic policy, quality of infrastructure, currency volatility, investor perceptions or crime rates.

The report also ranks 181 economies on the overall regulatory ease of doing business. The top 25 in the 2009 report are, in order: Singapore, New Zealand, the United States, Hong Kong (China), Denmark, the United Kingdom, Ireland, Canada, Australia, Norway, Iceland, Japan, Thailand, Finland, Georgia, Saudi Arabia, Sweden, Bahrain, Belgium, Malaysia, Switzerland, Estonia, Korea, Mauritius and Germany.

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