In its recently released report on Doing Business in South Asia, the World Bank classified Pakistan, a country with population of around 160 million, in the low income category with $690 of per capita income. The report covers 8 countries — Maldives takes the top position, followed by Pakistan at the runner-up position. The list continues with Bangladesh, Sri Lanka, Nepal, India, Bhutan, and Afghanistan.
The report suggests that as a region, South Asia performs comparatively well in business start-up procedures and in protecting investors. However, it lags far behind on the ease of employing workers, enforcing contracts, and trading across borders.
According to the World Bank, the recent series of reforms in Pakistan in the area of trade liberalization and improved logistics procedures have resulted in a drop in a number of days needed to import goods into the country from 39 to 19. In the area of tax reforms, Pakistan has seen its corporate tax rate drop from 39% in 2004 to the current level of 35%. Notably, the country stands at the 19th position out of 175 countries in protecting investors.
According to the press release on the launch of the report, the country can improve its overall score by learning from the more successful regions:
Provinces can learn from each other in the areas of business regulation where there are important regional variations. In Lahore, for example, starting a business is easiest; in Peshawar, resolving a commercial dispute through court is easiest; and in Karachi, registering property can serve as best practice. “One of the most interesting findings of the report is how Pakistan could improve significantly if it simply adopted the best practices in business regulation that already exist within the country. Pakistan could jump from its current position at 74th to 52nd on the Doing Business rankings,” said Caralee McLiesh, one of the authors of the report.
CIPE, in its deliberations with the Ministry of Commerce, Federation of Pakistan Chamber of Commerce & Industry and other business associations has seen the willingness on the part of the business community and government to bring reforms to help businesses prosper in the country. The challenge now is to get commitments to reform into action!
Published Date: March 07, 2007