Reform: An everyday struggle

Some successes of BICF
** Automation of Registrar of Joint Stock Companies that has reduced the time needed to register a company from 57 days to three days, and just one day through fast track.

** Automation of Dhaka Customs House has reduced the steps to three from six and the number of days from 40 to 20.

** BICF has helped the government prepare the Economic Zones Act and e-payment law. Deployment of Labour Counsellors in Economic Zones.

** The time to register property was reduced from 425 days to 245 days.

** The time to obtain Bonded Warehouse Licensing was reduced by three months.

** It created an online registration system at the Board of Investment and an investor-friendly website.

To remain competitive is vital in today's business world. Developed countries with business-friendly policies and regulations continue to reform to make their businesses more competitive.
Being an under-developed and under-reformed country, Bangladesh needs to move fast to simplify policies, rules and regulations and make these pro-business. The government must understand what the businesspeople want.
Pierre Guislain, director of Investment Climate Department of the World Bank and The International Finance Corporation (IFC), made these observations in an interview with The Daily Star recently. He said investment is mobile now and people have choices to go to other countries if they find the business environment too cumbersome, costly and time-consuming.
Guislain cited examples from Singapore, a developed and business-friendly country. In terms of the business environment, Singapore is one of the best countries in the world.
“Yet, it (Singapore) does reforms everyday to remain competitive,” he said. Bangladesh can do the same, said the IFC official. “It's not that you'll do it in 5 or 10 years.”
Bangladesh has successfully carried out reforms in some sectors. He said automation in the Registrar of Joint Stock Companies (RJSC) and Dhaka Customs House (DCH) has dramatically reduced the time and cost of doing business. According to the World Bank Doing Business report, Bangladesh was the most active reformer in South Asia in 2010, with key reforms in land, automation and e-governance.
“These automations will also increase revenue and reduce illegal payments,” said Guislain, a Belgian national who joined the World Bank group in 1983. He came to Dhaka to launch a new initiative -- Business Initiative Leading Development (BUILD) -- that will hold dialogues on a regular basis and in an open manner between the public and private sectors.
IFC, the private sector development arm of the World Bank Group, promotes sustainable private sector investment in developing countries as a way to reducing poverty and improving people's lives.
IFC undertook a programme named Bangladesh Investment Climate Fund (BICF) in 2007, aiming to help the private sector grow with a better operating environment. BICF, along with the government, jointly design and implement programmes to institute more business friendly policies, laws and regulations, and strengthen the institutions and civil servants who implement them.
Under BICF, IFC has helped RJSC and DCH to become automated. IFC also helped the government to draft the Economic Zones Act and E-Payment Law. It has also worked to develop the Bonded Warehouse and land registration systems.
The IFC official said ongoing works include modernisation of tax administration, including simplification of Income Tax and VAT laws, simplification of regulations at the municipalities and support to private sector-led public-private dialogue. BICF is also working on the government's vision to create a Digital Bangladesh.
“BICF doesn't do funding. We provide technical assistance in line with the global best practices,” said Guislain.
He emphasised simplifying procedures using Information and Communication Technology (ICT) and making them more business-friendly, especially for small companies and new entrants.
Guislain said large companies have resources and can hire people, but a small firm cannot. The burden of regulation costs small companies more than large companies, he added.
He appreciated the government's initiatives to create a Digital Bangladesh. He said it is essential for the growth and development of the country.
ICT helps to establish a transparent administration that is essential for growth, he added.
IFC has also helped the government draft an e-payment law, which is likely to be enacted soon.
Guislain wants the government to allow the private sector to come in and develop the economic zones. “It will help make a dynamic zone.”
Masrur Reaz, programme manager of regulatory simplification of BICF, said their efforts to help the government implement e-governance services are geared to enhance the interface between the government and private sector and to promote investment, business growth and job creation.

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