It takes half the amount of time for budding entrepreneurs in the Asia-Pacific region to set up a business today compared to about a decade ago.
Back in 2009, APEC set out to improve the business environment in the region through regulatory reforms that make it cheaper, faster and easier to do business. This gave rise to an initiative called Ease of Doing Business (EODB), which looks at the performance of the APEC economies through a set of indicators or priority areas. These indicators give an overall picture of how rules and regulations of an APEC economy facilitate – or hamper - the growth of the private sector.
“Making processes efficient for businesses to set-up and reducing the amount of time it takes for entrepreneurs to meet these requirements encourages economic activity,” says APEC Economic Committee Chair Rory McLeod. “When businesses can open quickly, economic growth ensues.”
APEC based its criteria on the World Bank’s Doing Business' five priority areas, namely: a) starting a business; b) dealing with construction permits; c) getting credit; d) trading across borders; and e) enforcing contracts.
While the assessment conducted in 2015 by the Policy Support Unit - APEC's research arm - saw the overall progress at 14.6% to be short of the 25% target, it pays to look closely at how the region fared in the individual indicators.
"When examining APEC’s average values of the indicators in all priority areas, the progress achieved in starting a business was a remarkable 47.4 per cent improvement, far ahead of the target," says Carlos Kuriyama, senior analyst in the APEC Policy Support Unit, who led the project. "The average time to start a business went down by almost two weeks from about 28 days to 15 days."
Even though it fell short of the target, the average time to get a construction permit still went down considerably. Data measured in 2015 found that member economies knocked 30 days, on average, off of the amount of time it usually takes to get these permits processed.
"Similarly, it is easier to get credit now, as financial institutions can access more information to evaluate credit applications. There was a noticeable expansion of the average coverage of the adult population with their credit information, going up from 48.8% to 61.4%”, says Kuriyama.
Member economies continue to build capacity for the necessary regulatory reforms on the five priority areas to be implemented.