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Sierra Leone's Doing Business Ranking for 2012 PDF Print E-mail

 

SIERRA LEONE’S DOING BUSINESS RANKING FOR 2012

Over the years, Sierra Leone has made significant progress in regulatory reforms that make it easier to do business.  The country’s Doing Business (DB) reform efforts began in 2005 with funding provided by the International Finance Corporation (IFC) to help create a better environment for the private sector to develop.

Sierra Leone’s DB ranking improved from 160 in 2008 to 150 in 2011, an upward movement of 10 places. In a bid to maintain this momentum, the government in 2011 embarked on aggressive DB reforms aimed at improving the country’s rankings and its investment climate. During this period, six reforms were implemented in six months and were dubbed 6 in 6.  The following reforms were implemented, namely:

  • Closing a Business/Enforcing Contracts: Commercial Court
  • Trading Across Borders: ASYCUDA
  • Starting a Business: Automation of records, Freetown City Council, TIN
  • Access to Credit: Credit Reference Bureau
  • Registering Property: Digitalization of land records
  • Construction Permits: One-stop shop at the Ministry of Works

 

With the implementation of these reforms, the DB 2012 Report ranked Sierra Leone among the top global reformers in the world as it ranking moved 9 places upwards from 150 in 2011 to 141 in 2012 out of 183 economies surveyed.  In addition, the Report recognizes improvements in four areas of regulation out of the six reforms: getting credit (credit information), trading across borders, enforcing contracts, and closing a business (resolving insolvency). Sierra Leone improved its credit information system by enacting a new law where commercial banks can obtain information from the Central Bank about the credit history of any potential customer before granting a loan to such customer. Also, it made trading across borders faster by implementing the Automated System for Customs Data (ASYCUDA++). The ASYCUDA++ makes clearing of goods from the ports faster, more efficient and also minimizes revenue leakages. The establishment of the fast-track commercial court made enforcing contracts and closing business (resolving insolvency) easier.

As shown in Table 1, the country made significant improvement in the procedures/processes of paying taxes as it moved from 160 in 2011 to 76 in 2012. Other DB indicators that also achieved double-digit positions are that of starting a business and protecting investors which stand at 72nd and 29th positions respectively.

Table 1: Sierra Leone Doing Business Ranking from 2008 – 2012.

Year

2008

2009

2010

2011

2012

Ease of Doing Business

160

156

148

150

141

Starting a Business

89

53

58

59

72

Employing Workers

169

173

166

-

-

Registering Property

172

163

175

169

169

Access to Credit

115

145

127

116

126

Protecting Investors

98

53

27

28

29

Paying Taxes

145

160

160

160

76

Trading Across Borders

130

132

137

137

132

Enforcing Contracts

140

141

144

146

141

Closing a Business

141

145

147

157

155

Dealing with construction permits

-

-

-

164

167

Getting Electricity

-

-

-

175

174

Source: various World Bank Doing Business publications

A new indicator (getting electricity) was introduced in 2011 and the country performed slightly better as it moved one place upwards from 175 in 2011 to 174 in 2012. Despite major reforms implemented, the 2012 Report however indicates that access to credit for entrepreneurs still remains a major bottleneck as reflected  in the the country’s ranking for this indicator .

Furthermore, Sierra Leone is still faced with major challenges in areas such as getting electricity, dealing with construction permits and registering properties.

On the whole, the DB 2012 Report indicates that Sierra Leone has made its regulatory environment more business-friendly.