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Report on the Launching Ceremony of 2011 Doing Business Ranking for Sierra Leone PDF Print E-mail

Doing Business ReportThe Ease of Doing Business (DB) Index was created by the World Bank to measure regulations that directly affects businesses. This index covers nine component indicators but does not measure all aspects of business environment that affects firms and investors such as an economy’s proximity to large markets, corruption, security and macroeconomic stability.

A nation's ranking on the index is based on the average of 9 (nine) sub indices namely; starting a business, dealing with construction permits, registering property, access to credit, protecting investors, paying taxes, trading across borders, enforcing contracts and closing business. Higher ranking signals that the country has a favourable investment climate. The rankings aid policymakers compare regulatory performance and prioritize reforms for a favourable business environment. The theme of the launching was “Making a Difference for Entrepreneurs”.

Launching Ceremony

In the absence of the Co-Chair, Mr. Mohamed B Cole, the Chairlady of the Sierra Leone Chamber of Commerce and Industry welcomed guests on behalf of the International Finance Corporation (IFC), Ministry of Trade & Industry (MTI) and Sierra Leone Business Forum (SLBF) and talked about the importance of DB rankings to investors.

Welcome Remarks by the Deputy Director, SLBF

Deputy Director SLBFThe Deputy Director of SLBF, Mr. Franklyn Williams in his welcome address informed the guests that the DB 2011 survey is the eight series of annual reports that benchmarks the regulatory concerns which enhances business activities. He said the survey which ranks countries represents qualitative indicators on business regulations and protection of property rights for 183 economies. He stressed that the annual survey measures the investment climate of each of these economies and the DB 2011 survey covered the period June 2009 to May 2010. He indicated that higher rankings signal that the country’s investment climate is conducive. He talked about the consistent improvement the country has made over the past years and concluded that he was optimistic that it would perform better in the 2011 ranking.

Presentation of DB 2011 results and analysis by Advisory Services Coordinator, IFC

The Advisory Services Coordinator of IFC, Ms. Mary Agboli in her presentation gave a brief overview of the rationale of DB rankings. She informed guests that Sierra Leone marginally improved on its DB ranking by 5 places from 148th in 2010 to 143th in 2011. She stated that the country is ranked top in the West African region and that it undertook 3 main reforms in 2010, namely; construction permits, registering property and paying taxes. She indicated that even though much has not been done, there is prospect that the country would perform better in the 2012 DB survey as a result of the current regulatory reforms underway. She revealed that the biggest improvement in the DB regulatory reforms occurred in Sub-Saharan Africa economies and that the continent continues to lead in trade reforms. In addition, she said that in dealing with construction permits, Democratic Republic of Congo (DRC) ranks top, Ghana (credit information and Legal rights), and Zambia a global top reformer in starting a business. Ms. Mary Agboli stated that the top reformers in Africa are Rwanda and Mauritania. She concluded by disclosing that Sierra Leone has been among the 30 most improved economies in the world for the past five years.

Response by the Minister of Trade and Industry to the DB Rankings

Former Minister, David CarewThe Minister of Trade and Industry, Mr. David Carew said that Sierra Leone has been a consistent reformer on the DB indicators as reflected in the number of businesses now operating in the country. He emphasised that the country has created a favourable environment for the growth and development of the private sector which is in line with His Excellency the President, Dr. Ernest Bai Koroma’s agenda for change. He mentioned the various legislations enacted by parliament in recent times, such as the New Companies Act 2009, Bankruptcy Act 2009, The Finance Act 2010, the Goods and Services Tax Act 2009 and the Public-Private Partnership Act 2010. In addition he stated that the Government embarked on administrative and regulatory reforms such as the newly created Corporate Affairs Commission and the merging of the Income Tax and Goods and Services Tax Departments to form the Domestic Tax Department.  Mr. David Carew informed the guests about Government’s commitment to undertake major reforms (setting up of a commercial court, land survey, modernisation of the Office of the Administrator and Registrar General, increase access to credit and establishment of a credit bureau) which when completed and implemented will greatly improved the country’s DB ranking. He concluded that a Monitoring and Evaluation mechanism will soon be set up to consistently monitor the progress made in improving the country’s DB ranking.

Presentation of the DB 2011 Action Plan by the Consultant

The DB consultant, Mr. Ishmael Yilla gave a presentation on the Action Plan for 2011 stating that his aim is to make Sierra Leone a top reformer in the 2012 DB ranking. He disclosed that he has targeted 8 major reforms which when implemented will significantly improved the country’s DB rankings. These reforms include; operating a commercial court, access to credit (new credit registry Act), starting a business (serve as a liaison between the Freetown City Council and Office of Administrator and Registrar General [OARG]), trading across borders (new custom bill, streamline Customs & Intertek procedures, payment of taxes through banks, closing business (conduct seminars for legal community), streamlining construction permits (provide technical assistance for drafting the permit) and registering property (needs standard deed of conveyance). In addition, he outlined the 4 key areas he intends to monitor regularly, namely; the paying taxes, the commercial court, digitalizing land survey and modernisation of OARG. He concluded by cautioning guests that for the DB reforms to be successful, political and technical support is necessary.

Statement from the Business Sector

Sierra Leone Manufacturing Association (SLAM)

  • Sierra Leone needs a healthy manufacturing sector so as to contribute to economic growth.
  • A healthy growth in the economy is needed so as to boost the purchasing power of consumers.
  • Skilled labour and infrastructural development is needed in the manufacturing sector.

Sierra Leone Importers Association (SLIA)

  • Private sector can only flourish and create job opportunities if the environment in which it operates is favourable to businesses.
  • The government needs to improve certain sectors such as energy, telecommunication and water.
  • The actors in the clearing of goods at the customs control area must be reduced to attract private sector growth.
  • For sustainable development and growth, government should empower indigenous businesses to lead the private sector.

Questions and Answers Session

The private sector Advisor, Mr. Oluniyi Robin-Coker moderated this session. The following are questions and their responses.

QuestionsMr Oluniyi Robbin-Coker

  • If Sierra Leone is among the 30 top reformers in the world, why is it that it’s ranking slightly improved by five places upwards?
  • In the past, a ban was placed on Sierra Leone because it was classified as a high risk country. The ban has been lifted but shipping costs are still high for ships entering the country. What strategies are in place to inform these agencies that the country is no longer a high risk country?
  • What are government plans to fast track the Credit Bill?
  • Why is the country’s currency (Leone) depreciating at a faster rate?

Responses

  • Countries are ranked based on the data available over the past 5 years and comparisons are also made among countries when determining the DB ranking.
  • Other factors are also included in the shipping costs.
  • Credit Registry Bill is already gazetted and it is expected to be enacted in parliament before the end of the year.
  • The country’s currency is stable compared to other currencies in the ECOWAS zone.

Closing Remarks by World Bank Country Director

World Bank, Country DirectorIn his closing remarks, the World Bank Country Director Mr. Vijay Pillai thanked guests for enriching the ceremony with their presence and views. He stated that 3 keys issues were learnt from the ceremony, namely; optimism, challenges ahead and clear commitments. He concluded by stressing that the DB rankings have confirmed the notion that Africa is on the move to economic growth.