World Bank: Georgia among Top Reformers in Doing Business

Georgia is among the top global improvers for implementing business friendly reforms, according to the World Bank (WB) report Doing Business 2017 (DB17) - Equal Opportunity for All, released on Tuesday.

Doing Business measures regulations affecting 11 areas of the life of a business. Ten of these areas are included in this year’s ranking on the ease of doing business: 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. Doing Business (DB) also measures labor market regulation, which is not included in this year’s ranking.

The report revealed that Georgia has improved its positions in several areas compared to the report of the previous year, now in the 16th position among 190 countries. Last year Georgia’s overall position in this raking was 23.

According to the report, globally, Georgia stands at 8 in the ranking of 190 economies on the ease of starting a business. The WB notes that in 2012, Georgia simplified business start-ups by eliminating the requirement to visit a bank to pay registration fees. The report also found that in Georgia women could start a business in the same way as men.

As for the dealing with construction permits, Georgia stands at 8 in the ranking, preceding Armenia, Turkey and Azerbaijan. According to the report, in 2016 Georgia made dealing with construction permits easier by reducing the time needed for issuing building permits.

According to data collected by Doing Business, Georgia is in the 39th position on ease of getting electricity. Last year Georgia held 65th position in this category. The report underlines that in 2013 Georgia made getting electricity easier by simplifying the process of connecting new customers to the distribution network and reducing connection fees and in 2016 the government increased the reliability of power supply by rolling out an electricity network remote monitoring system for the monitoring of outages and introducing penalties on the Utility for excessive outages.

As for registering property, the WB report says that globally, Georgia stands at 3 in the ranking of 190 economies on the ease of registering property, preceding its neighbor countries in the region.

“Georgia improved the quality of land administration by increasing coverage of all maps for privately held land plots in the main business city,” the report reads.

Georgia stands at 7 in the ranking of 190 economies on the ease of getting credit, the same position as the previous year. However, the report says that Georgia improved its credit information system by implementing a new law on personal data protection.

According to WB, Georgia is in 7th position on the strength of minority investor protection index, which is a huge step forward, as it held position 22 in this category last year.

“Georgia strengthened minority investor protections by increasing shareholder rights and role in major corporate decisions and by clarifying ownership and control structures,” the DB 2017 report reads.

As for the category of paying taxes, Georgia is in the 22nd position, up from 35 in the DB 2016 report. DB 2017 highlights that Georgia made paying taxes easier by abolishing an additional annex to corporate income tax returns and by improving the efficiency of the online system used for filing VAT returns.

Moreover, Georgia stands at 54 in the ranking of 190 economies on the ease of trading across borders. According to the previous report, Georgia stood at 62 in the ranking. DB 2017 underlines that this year Georgia made export and import documentary compliance faster by improving its electronic document processing system, as well as introducing an advanced electronic document submission option.

Georgia stands at 16 in the ranking of 190 economies on the ease of enforcing contracts, slightly improving its position. According to DB 2016, Georgia made enforcing contracts easier by introducing an electronic filing system for court users.

The report says that well-functioning insolvency systems can facilitate access to finance, save more viable businesses and sustainably grow the economy. Georgia stands at 106 in the ranking, without having made any progress in this field, as last year, it was in the 101st position.

Doing Business 2017 presents the indicators, analyzes their relationship with economic outcomes and presents business regulatory reforms. The report is based on the data of June 1, 2016.

Thea Morrison

27 October 2016 20:09