World Bank takes notice of Turkey’s rapid reforms in its annual “Doing Business”
Last week, The World Bank released its annual “Doing Business 2019 - Training for Reforms” report. Turkey showed notable progress in reforms that enhance the business climate and carried out a record number of business reforms in the past year, earning the country a spot in this year’s top 10 most improved, the Bank said in a statement.
According to the report, last year’s reforms accelerated Turkey’s efforts to improve the business climate for domestic small and medium enterprises – SMEs. “In the past five years, Turkey has averaged just one reform a year,” the Bank said. “As a result of the past year’s reforms, Turkey advanced to 43rd place in the global ease of doing business ranking.”
Johannes Zutt, World Bank Country Director for Turkey, said: “I am pleased to note the priority the government is placing on the important agenda of improving the business climate to boost investment and create jobs. Given the current economic environment in Turkey, it is, nevertheless, encouraging to the global business community and local entrepreneurs alike to see the process of conducting business has simplified in so many areas.”
“Result of h ghly coord nated work”
“The Doing Business Report and Index is considered a guide in the investment decision process by international investors,” International Investors Association (YASED) Chairman, Ahmet Erdem, said. “The countries that have improved the criteria of the World Bank’s Doing Business Index increase their competitiveness
at the investment attraction point.”
“Recently, a lot of intensive work has been spent on the Coordination Council for the Improvement of the Investment Environment (YOIKK) platform to improve the issues that constitute this index,” Erdem added. “YOIKK, established to improve the business and investment environment in Turkey, is one of the most successful examples of public-private sector cooperation. In the last period under the auspices of the President of Turkey, it has gained an effective and efficient structure. Coordination is carried out by Incentive Implementation and Foreign Capital General Directorate within the Ministry of Industry and Technology. This success is the result of highly coordinated, focused work.”
As noted in the report, Turkey implemented a total of seven reforms, including starting a
business, dealing with construction permits, getting credit, paying taxes, trading across borders, enforcing contracts, and resolving insolvency. “The country performs best in the areas of enforcing contracts, with a global rank of 19, and protecting minority investors [26th place]. For example, resolving a commercial dispute through a local first-instance court in Turkey costs 25 percent of the claim value, compared to the regional average of 26.3 percent,” the Bank said.
Inst tut onal changes
Several of these reforms involve institutional changes, the report added. “In Turkey, the government’s reform effort focused on improving the electronic processing of documents and providing more information on specific regulations. Istanbul and other municipalities across the country published on their websites all relevant regulations, fee
schedules and pre-application requirements related to construction permits.”
The Ministry of Justice now publishes all judgments rendered by the Istanbul commercial courts, the civil courts of intellectual and industrial rights and the Istanbul Regional Court of Justice on legal disputes concerning commercial, intellectual and industrial rights since 2014. Furthermore, the Banks Association of Turkey Risk Center began sharing credit information from seven telecommunications companies, it said.
The World Bank also noted that Turkey is one of only seven economies in the world that score 15 or higher in the quality of the judicial administration index. “It also performs well in the area of registering property, with a global rank of 39,” it said. “At just five days, it is four times faster to register a property transfer in Turkey than in the region.”