WINDHOEK - The World Bank’s (WB) Doing Business Report 2019, released at the end of October 2018, shows Namibia dropped one rank from 106 to 107 out of a total of 190 countries. The report ranks Namibia as 7th out of 14-member states of the Southern African Development Community (SADC) just like last year. However, while five SADC member states improved the ranking by up to five places (Mauritius) and one country maintained the ranking (South Africa), most SADC countries dropped by up to seven places (Tanzania).
The World Economic Forum’s Global Competitiveness Report, released just a fortnight ago, and the World Bank’s Doing Business Report provide among others, governments, investors and financial institutions with information on factors crucial for investors. The Doing Business Report covers 10 areas, such as the ease of starting a business, dealing with construction permits, getting electricity or registering property, with a total of 45 indicators. A country receives a score for each of the indicators and the total score determines the ranking of the country compared to the rest of the globe.
“Overall, the results of both the Global Competitiveness Report and the Doing Business Report need to be analysed thoroughly and decisive steps need to be taken to address the poor performance. As the Minister of Finance stressed several times in his Mid-Year Budget Review speech, improving competitiveness is vital to attract domestic and foreign direct investment that will create jobs and generate income. We cannot afford to continue with business as usual,” noted Klaus Schade, a Research Associate at the Economic Association of Namibia.
In this most recent Doing Business Report, Namibia improved the ranking in three out of the 10 indicators, namely in dealing with construction permits (up by 24 places to rank 83), enforcing contracts (up by one to rank 58) and in registering property (also up by one to rank 174). The country maintained the ranking regarding starting a business at 172 out of 190 countries.
In contrast, Namibia lost ground in six categories, namely; getting electricity (down by three to 71), getting credit (down by five to 73), paying taxes (down by 2 to 81), protecting minority investors (down by 10 to 99), resolving insolvency (down by two to 125) and trading across borders (down by four to 136).
Namibia did score better in five out of the 45 indicators and slipped in one. The score in the indicator ‘ease of shareholder suits index’ dropped from seven out of 10 to six. The time to register property decreased from 52 days to 44 and the quality of land administration improved from 8.5 to 9.5 out of 30. Likewise, the score for the quality of judicial processes increased from 9.5 to 10.5 out of 18 while the building quality control index rose by two points to 8.5 out of 15.
Schade noted that the cost of getting electricity as a share of per capita has continuously improved over the years to 304.4 percent. The improved scores in some indices, however, resulted in a better ranking in only three indicators, while despite declining costs for getting electricity Namibia dropped three ranks in this category.
“Since NDP 4 in 2012, Namibia aims at being the most competitive economy in Africa. This target is repeated in the Harambee Prosperity Plan and NDP5. We have missed the target again by a wide margin. Even though Namibia maintained the score in most indicators, the country slipped ranks again, which clearly indicates that other countries have made more progress over the years,” said Schade.
The WB report further shows that the number of days to start a business in Namibia remains unchanged at 66 since 2010, despite the establishment of the Business and Intellectual Property Authority (BIPA).
“Despite the launch of the NamBizOne portal there is no progress with the single window facility, which would accelerate business registrations. New technologies are hardly used to ease business registrations. Registration applications cannot be submitted by email, neither proof of payment. Furthermore, opening hours at BIPA, for instance, are business unfriendly,” Schade stated.