SA slides in ranking on ease of doing business

SA is becoming a more difficult and cumbersome place for small and medium-sized companies to do business, says the World Bank, whose latest global index shows it has toppled eight places down the rankings.

The latest Doing Business survey ranks SA at only 82nd on the index of 190 countries, down from 74th last year, as the red tape in SA remains as tight as ever at a time when other countries in sub-Saharan Africa and elsewhere are making it easier for entrepreneurs to start up and expand their businesses.

SA’s slide on the key World Bank rankings comes after it fell 14 places in the World Economic Forum’s (WEF’s) Global Competitiveness index, mainly due to the erosion of the strength of SA’s institutions and financial markets, with the WEF in September citing corruption and government instability as the most problematic factors.

The acting director of the World Bank’s global indicators group, Rita Ramalho, said on Tuesday that other countries were overtaking SA, which had not made any positive changes in any of the areas of doing business that the World Bank measures. “The main reason why SA declined in the rankings was not because things deteriorated in SA, but because other countries have been reforming,” she said.

SA lagged particularly in the ease of starting a business – it takes 45 days for an entrepreneur to meet the regulatory requirements to get a business up and running in SA, whereas it takes less than 20 days in 130 other countries. SA is ranked 130th on starting a business but performs well on protecting minority interests, which includes areas such as stockmarket regulation, company law and corporate governance.

The latest ranking places SA only joint fifth in sub-Saharan Africa, lower than Rwanda (at 41), Kenya and Botswana as well as Mauritius — at 25, the highestranked economy in Africa.

New Zealand, Singapore and Denmark again topped the rankings.