Since 2004, the World Bank and International Finance Corporation have issued an annual report on regulatory reforms aimed at facilitating business. Issued on September 9, 2009, the latest Doing Business Report (DBR) ranked Lebanon a humble 108th from a total of 183 countries worldwide. Last year, Lebanon found itself ranked 101st.
The index is headed by Singapore, New Zealand and Hong Kong, while Saudi Arabia (KSA) at 13 is the region’s top performer in the Middle East and North Africa region, followed by Bahrain (20) and the United Arab Emirates (33). The region as a whole however proved remarkably active in terms of easing business procedures: 89 percent of the countries in the Middle East and North Africa (MENA) implemented at least one improvement. Only the regions of Eastern Europe and Central Asia, at 96 percent, improved more.
The DBR ranks 183 economies based on 10 indicators of business regulation concerned with such variables as the time and cost it takes to meet government requirements to start up a business, operating and closing a firm, trading across borders and paying taxes. The index does not reflect indicators such as macroeconomic policy, security, labor skills, strength of the financial system or financial market regulations. Nor does it include corruption.
Regional rankings from the World Bank’s Doing Business Report
Globally, Lebanon was ranked just ahead of Greece and Guatemala, and right behind such countries as Sri Lanka and Ethiopia. Among the 19 MENA countries, Lebanon ranked 12th, behind Jordan and Egypt, and ahead of Syria. The country ranked relatively high in terms of starting a business, which takes only 9 days compared to an average of 20.7 days in the MENA region and 5.7 days in the Organization for Economic Cooperation and Development (OECD) countries.
However, it takes a disappointing 211 days to obtain a construction permit to build a warehouse, compared to an average of 159.3 days in the MENA region and 157 days in OECD states. Also, Lebanon was ranked 111th globally and 14th within the MENA region in terms of registering property. It takes eight procedures and 25 days to register a property in Lebanon, compared to an average of 6.1 procedures and 36.1 days in the MENA region and to 4.7 procedures and 25 days in OECD countries.
On the other hand, Lebanon proved relatively tax-friendly: ranked 34th globally, and ninth within the MENA region. It takes a Lebanese firm on average 180 hours per year to prepare, file and pay its taxes compared to 204.2 hours in the MENA region, and 194.1 hours in the OECD countries. Also, tax payments represent only 6.1 percent of company profits, compared to 12.6 percent in the MENA region, and 16.1 percent in the OECD countries.
While it is relatively easy to export from Lebanon, it requires some time and effort to import goods. It takes five procedures and 26 days to export goods, compared to an average of 6.4 procedures and 22.5 days in the MENA region, and 4.3 procedures and 10.5 days in OECD countries. The cost of exporting a container is $1,002, which is comparable to the MENA and OECD average. Importing goods however takes no less than 35 days, compared to 25.9 days in the region and 11 days in the OECD countries.
