Burma: Still a hard place to do businessBy Asia Sentinel Nov 03, 2013 6:22PM UTC
World Bank ranks the country near the bottom of 185 economies writes Simon Lewis for Asia Sentinel.
After emerging from decades of isolation, Burma remains one of the most difficult countries in the world in which to do business, according the World Bank, which has included the Southeast Asian nation in its annual “Doing Business” report for the first time.
Burma’s first appearance in the report reflects liberalizing economic policies advanced by the quasi-civilian government that took power in 2011. Reforms have been accompanied by talk of investors rushing into the resource-rich nation’s underdeveloped market.
However, the report—which compares the obstacles to starting and operating a business in 189 countries—may dampen the hype. It ranks Burma at 182, judging that only a handful of economies, including Chad, the Central African Republic and Eritrea, offered a worse environment for business.
The report looked at different areas where bureaucracy or over burdensome regulations can stifle entrepreneurs. There was some praise for Burma, particularly for the government’s decision to reduce its corporate income tax rate. Under the 2012 Foreign Investment Law the income of local branches of foreign enterprises are taxed at 25 percent, the same basic rate as locally incorporated companies.
But the country was ranked bottom of the global table for the ease of starting up a business, largely due to the high cost. Starting a business involves 11 different procedures, takes 72 days and costs nearly US$1,500 in Burma, it said. And a deposit of more than $58,000 is required to start a business—higher than in any other country—the report said, pointing out that such requirements in general “signiﬁcantly slow entrepreneurship.”
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