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World Bank’s 2020 Ease of Doing Business report shows that Papua New Guinea has taken a dive down the rankings from its 2019 placing of 108 to 120 out of 190 countries studied.
Doing Business 2020 is the 17th in a series of annual studies investigating the regulations that enhance business activity and those that constrain it.
Doing Business presents quantitative indicators on business regulations and the protection of property rights that can be compared across 190 economies with 1 being the easiest to do business in and 190 being the hardest.
What could quickly be described as a realistic indication of what has been stated over the past year on the economy and the issues surrounding the general business environment for investors to the country, with reforms indicated by government that have aroused uncertainties in the investment and business space, some of which include the proposed Foreign Investment Bill which the current government has indicated it will support, proposed amendments to the mining act that have caused concern within the mining sector, and other planned amendments to other resource extraction laws have had mixed views.
However, according to World Bank Group member organisation, the International Finance Corporation (IFC) has specified a number of factors within the PNG’s domestic front and that of countries studied within the 17th edition of the report have contributed to the outcome of the report.
IFC’s senior operations officer, Jonathan Kirkby, pointed out that overall Doing Business 2020 report showed overall the pace of business climate reforms slowed across the East Asia Pacific region, but clearly highlighted the need for low cost reforms.
“Papua New Guinea’s standing in the rankings reflects the fact that other nations have moved ahead.
The opportunity is there for Papua New Guinea to climb in the rankings by making some relatively simple reforms, which are low-cost but would help business.
“They can look to countries such as Rwanda that have jumped very substantially in the rankings by having an organised programme of regulatory reform.
“The Investment Promotion Authority has taken a good first step by holding its Regulators Summit in September this year.
It’s important now to put together a coherent programme of reform to simplify and streamline business regulation and act on it,” Kirkby said.
Despite the downgrade in placing Kirkby also highlighted the positives within the report highlighting implementation of a number of positive reforms to improve its business regulatory framework such as:
– PNG made paying taxes less costly by abolishing the training levy;
– PNG made paying taxes easier by issuing value-added tax refunds more quickly thanks to more streamlined audits; and
– PNG made trading across borders easier by implementing an automated customs data management system.
Last year the 2019 edition credited PNG with reforms in improving its electricity systems as a major element to a conducive business environment, and also the advancements in property registration and protection of minority investors, thus moving its placing up from 109 to 108.
The reports look at regulations affecting 12 areas of the life of a business such as: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts, resolving insolvency, employing workers, and contracting with the government.
The employing workers and contracting with the government indicator sets are not included in this year’s ranking on the ease of doing business.
SOURCE: POST COURIER/PACNEWS
Pacific Islands News Association
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