Publish in Special Reports - Tuesday, October 23, 2012
Costa Rican president Laura Chinchilla. (Photo: Roberto Montero/Casa Presidencial)
Colombia improved most the past five years.
BY LATINVEX STAFF
Costa Rica was the Latin American country that improved its regulatory environment the most the past year, according to the latest Doing Business report from The World Bank and the IFC.
“We are very encouraged by the progress in Costa Rica, where the authorities showed that focused efforts can make a difference in the business climate, even within a relatively short period,” Augusto Lopez-Claros, Director of Global Indicators and Analysis at the World Bank Group, said in a statement.
The country implemented regulatory changes in four of 10 areas measured by the report and is among the global top 10 improvers during the past year.
Costa Rica improved access to credit information by guaranteeing borrowers’ right to inspect their personal data and streamlined the process for obtaining construction permits by implementing online approval systems, the Doing Business report points out. It also made paying taxes easier for companies by implementing electronic payment for municipal taxes—though it also introduced a registration flat tax. And it made starting a business easier by streamlining the process for obtaining a sanitary permit for low-risk activities.
Nearly half – 15 of 33 – of the economies in Latin America and the Caribbean made improvements during the period June 2011 to June this year.
“The strides made in recent years in Chile, Peru, Colombia, and Mexico—with performance in some of the indicators tracked by Doing Business already at levels seen in rich industrial economies—suggest that the rest of the region can also narrow the regulatory gap,” Lopez-Claros said.
In the past year, Peru strengthened investor protections and dropped requirements for several preconstruction approvals, The World Bank said.
Looking at reforms from a five-year perspective, Colombia is the clear leader, although Guatemala, Peru, Mexico, Uruguay and the Dominican Republic also were singled out for their progress.
“Colombia made starting a business easier over the past seven years by allowing electronic submission of documents and eliminating the need to have signatures notarized, among other initiatives,” the bank said.
CHILE BEST, BRAZIL AMONG WORST
Chile remains the best country on the Doing Business ranking in Latin America, followed by Peru, Colombia, Mexico and Panama. Venezuela ranked last, followed by Haiti, Bolivia, Ecuador and Brazil. That means Brazil has worsened its ranking in Latin America – from sixth-worst to fifth-worst.
The World Bank praises Brazil for making enforcing contracts easier by implementing an electronic system for filing initial complaints at the São Paulo Civil District Court. However, Brazil is criticized for making transferring property more difficult by introducing a new certificate of good standing on labor debts, adding to the number of due diligence procedures.
Mexico was praised for making it easier to get electricity in Mexico City thanks to the Federal Electricity Commission (CFE) streamlining procedures, offering training opportunities to private contractors, using a geographic information system (GIS) to map the electricity distribution network, and increasing the stock of materials. In addition, Mexico made starting a business easier by eliminating the minimum capital requirement for limited liability companies, the bank points out.
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